Juncker’s new investment plan shows he still has not understood the problem

DISCLAIMER: All opinions in this column reflect the views of the author(s), not of EURACTIV.COM Ltd.

Frontex officers resue migrants off the coast of Libya. [Frontex]

Jean-Claude Juncker is today (14 September) expected to launch the new European External Investment Plan, which aims at “addressing the root causes of migration”. But once again Europe’s solution to the “migration crisis” is not only wrong – it is actually no solution at all, writes Natalia Alonso.

Natalia Alonso is deputy director for Advocacy and Campaigns at Oxfam International.

In his State of the European Union address today the Commission President will add one more thread to Europe’s response to what it perceives as a “migration crisis”. The EU executive outlined its plans for the External Investment Plan for the first time in June. The idea is to mobilise €3.1 billion, which is expected to trigger total investments of up to €31 billion. A large chunk will be offered to European companies so they invest, or facilitate investment, in the countries of origin of migrants who are trying to reach Europe. In the Commission’s view, this will “address the root causes of irregular migration” and create opportunities for people so they will not want to leave their countries anymore.

But this idea is fundamentally flawed in many ways. And it simply won’t work.

In fact, the Commission has not even correctly defined the problem it is promising to tackle: the root cause of migration. The root cause of migration is human nature – a desire to lead a safe and healthy life. Migration only becomes problematic when it is deemed as irregular, which is what states do. There clearly are means for managing migration, and just speaking of root causes is meaningless without looking at why some migration is irregular.

Development leads to more migration, not less

Research clearly shows increasing development generally leads to more migration, not less. What is more, migration contributes to innovation, economic growth and personal development – it therefore should not be stifled. Human migration has been occurring since Homo Sapiens came into being. It is important for Europe to realise that, if managed well, development and prosperity can go hand in hand with the movement of people.

This is why the Commission must separate its investment plan from European migration control policies that promote short-term foreign policy objectives.

The situation is different for forced displacement – where people are fleeing their homes, seeking refuge either in their own country or across borders. These situations need a holistic approach that addresses the causes of the crises and chronic problems that lead to them. The European Union must not look at conflict through the narrow lens of how to stop people fleeing their homes. This cannot be solved through private investment alone.

Companies wont invest in unstable countries

But the mistaken analysis of the issues at stake is not the only problem with Juncker’s new investment plan. It is also questionable to believe that throwing money at European companies will help sustainable investment in highly unstable countries. While private finance, if used for the right purpose and in the right way, can help to mobilise the funds needed to drive sustainable development, it is nevertheless driven by market forces: companies will target richer developing countries to secure a return on their investment.

So far, the benefit of blending public and private funds in development is debatable. A 2014 report by the European Court of Auditors on the use of blending found for half of the projects examined that “there was no convincing analysis” that tax payers’ money was necessary in order for the company to invest in a developing country.

Development aid is a small pot of money with a big objective. To ensure a sustainable solution, it would be more prudent for Europe to support public investment, like health and education. This can reduce barriers to private sector investments and is a better way of supporting and strengthening the domestic private sector in developing countries, because it allows the creation of a stable environment needed for sustainable investment from companies.

Juncker’s investment plan instead runs the risk of promoting and financially supporting a greater corporate presence in developing countries in the absence of an adequate legal framework that would guarantee corporate accountability and transparency. Such an environment does not ensure justice for victims of corporate malpractice, it may instead incentivise exploitation and human and labour rights violations. Subsequently, there is a real risk that this will undermine the plan’s stated aims of promoting a dignified life with more and better jobs.

Junckers investment plan contradicts EU commitments on development cooperation

Framing development as a “solution” to the “problem” of migration is a false premise that diverts the debates and actions around migration in the wrong direction. The EU’s investment plan should instead contribute to tackling inequalities, fighting climate change and creating local opportunities for a safe and dignified life, so that people can choose whether to migrate or not.

Development cooperation should be based on the needs and the rights of the people it is supposed to support. It must not be used as foreign policy leverage on the basis of strategic interests. The investment plan, as the Commission has conceived it so far, will support Europe’s wholesale reorientation of development aid towards stopping migration. This is an unacceptable contradiction to the EU’s commitment to use development cooperation with the aim of eradicating poverty.

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