Development assistance has adapted to circumstances, but China looms

Friday February 12 Georgetown’s Walsh School of Foreign Service convened the Transatlantic Policy Symposium (TAPS), an annual conference organized by the graduate students of the BMW Center for German and European Studies. The conference brought together academics and professionals from around the world to discuss transatlantic cooperation and development assistance in the developing world. Speakers and their affiliations are listed below:

Speakers

Dr. Anne-Marie Gulde Wolf: Deputy Director for Asia and Pacific, International Monetary Fund

Eric Kite: Deputy Director, Caribbean Affairs, United States Agency for International Development

Helga Flores Trejo: Vice President, Global Public Affairs International Organizations, Bayer AG

Recent Changes in Development Assistance

Each of the three panelists elucidated key changes among their respective institutions with regards to development assistance. Kite explained that USAID traditionally engaged primarily in bilateral, state-to-state assistance programs. Over time, however, multilateral organizations have grown dramatically and now dwarf the size of USAID. The US government has correspondingly shifted its development assistance from bilateral to multilateral frameworks.

Gulde Wolf emphasized that the IMF has likewise changed its strategic focus over the years. While the IMF’s original mission consisted largely of short-term loans and financing, by the 1980s the IMF began to offer more long-term loans to low-income countries and increased its emphasis on capacity building and technical assistance, understanding that no amount of loans are sufficient if countries fail to also develop good economic policy. The IMF now has three major areas of interest

1. emergency lending to respond to the COVID-19 pandemic, which has provided assistance to 50 countries to date,
2. developing sound macroeconomic policy to address global climate change,
3. debt management and debt restructuring in low-income countries to address a long-term debt crisis that the pandemic has exacerbated.

Flores Trejo also noted several recent changes in the development sphere. She echoed the sentiments of Kite that development has become more cooperative and partner-based. To that end, the private sector–including NGOs, foundations, and corporations–has become increasingly involved in major development programs around the world. Development actors have begun to see their work more holistically, including linking development to foreign and defense policy, as well as an understanding that successful development requires a global approach. Uneven development will ultimately be counterproductive.

Partnership and Development Assistance

Given that development programming has become more holistic and more diverse, the panelists also reflected on the problems and promises of partnership across institutions.

Flores Trejo in particular reflected on the importance of governments cooperating and partnering with the private sector to implement development programs. She pointed to the most recent iteration of the Edelman Trust Barometer, which indicates a major decline in public trust for both the government and the media. Notably, however, companies and the private sector writ large have a higher degree of public trust than government, which can potentially bridge the credibility gap by partnering with the private sector to implement programming.

Kite similarly stressed the importance of cooperation for USAID. He emphasized that local actors in partner countries are crucial for both information gathering and implementation. However, he also argued that USAID has traditionally cooperated best with organizations and countries that have shared values. China, however, has posed a unique problem for the US as it has dramatically increased its own development assistance in direct opposition to the strategic interests of the US.

Gulde Wolf argued that the IMF has been uniquely successful at working collaboratively to address development issues. She attributed the organization’s success in this area in large part to the near universal membership of the IMF, which encourages broad partnership. Like Kite, she also believed that the emergence of China as a major development actor has presented challenges to the debtor-creditor relationship. However, she also clarified that the IMF has little ability to address these particular emerging challenges.