OPINION:If Ireland keeps its commitment to overseas aid it will be well repaid in the future, writes TOM ARNOLD.
THE MEETING of the G20 leaders in London on April 2nd is playing for high financial, economic and political stakes. With the deepening crisis being compared to that of the 1930s, British prime minister Gordon Brown hopes the meeting can start reshaping the rules for global financial regulation, provide a co-ordinated fiscal stimulus to global demand and restore a sense of hope for the future.
The G20 brings together the leaders of the rich world (the existing G8), the major emerging powers such as China and India, and the main middle income developing countries. The leaders of the poorest countries will not be at the table, but it is vital that the meeting takes account of their interests.
The economic recession has hit the poorest countries hard. Economic growth in Sub Saharan Africa is projected to halve from the 7 per cent achieved in 2007. The flow of remittances to developing countries, worth three times more than all foreign aid, is dropping rapidly as millions of migrant workers lose their jobs and return home. Falling exports have reduced employment and increased debt levels.
Two powerful factors – political stability and economic recovery – dictate that the G20 meeting takes decisions to assist poor countries. Just a year ago, soaring food and energy prices led to riots in some 30 countries. If the current recession leads to further sharp reductions in living standards, political stability could be threatened in even more countries.
Any credible programme aimed at restoring global economic growth must protect the very poorest, for reasons of justice and social solidarity. It must keep purchasing power in the hands of a wider group of poor people who will spend their available income and support economic activity.
The minimum political response is a recommitment by the G8 countries to meet their aid targets. But the leaders from non-G8 countries, which are increasing in economic and political power, should be challenged to contribute more to global economic recovery and assist the poorest countries.
The Irish Government will introduce its next budget on April 7th, with the same broad aims of preserving financial stability and protecting economic growth.
The budget will be judged, politically and by the public, on two key tests – is it seen to be fair, and does it provide hope for the future?
As we have observed in recent months, fairness, like beauty, is in the eye of the beholder. But there is general public acceptance that living standards will drop over the coming years: the test is how that pain will be shared, and how the most vulnerable can be best protected. Acceptance of the budget decisions will depend on whether there is a genuine effort to share pain equitably.
The hope test requires that the budget is framed as part of a credible longer term recovery programme. A first set of difficult choices lie in cutting spending sufficiently to meet the target of a budget deficit below 10 per cent, while doing minimum damage to the real economy and protecting employment.
A second set of choices lie in combining necessary cuts with intelligent strategic investments to enhance our long-term competitiveness. Economic recovery will occur, even if its timing is not clear, and our decisions now must help us capitalise on the situation when it does.
The decision on the allocation of overseas aid is relevant to the tests of fairness and hope. The Government has committed, to the Irish people and to the wider international community, to provide 0.7 per cent of our national income in overseas aid by 2012, with an intermediate target of 0.6 per cent by 2010. As national income has fallen, the money amount of that commitment has reduced.
But falling national income has also increased poverty in Ireland and reduced the Government’s capacity to provide services. Some people – understandably – say “charity begins at home”, and suggest the aid budget should be cut to look after our own needs.
Charity may indeed begin at home, but charity – and justice – does not end there. However straitened our current national circumstances, they do not compare with the terrible poverty in the countries in which Irish aid money is spent – and spent well, some of it in partnership with Concern, Trócaire and Goal and other NGOs.
Balancing our books by cutting back our support for some of the world’s poorest people does not pass the fairness test.
Our aid contribution, and how we use that aid, is also relevant to the hope test. Ireland’s commitment to meet the 0.7 per cent aid target by 2012 received widespread international praise. The Irish aid programme is recognised by independent sources, such as the OECD, as one of the most effective in terms of poverty alleviation.
Any vision for Ireland’s future economic success must look to such factors as reputation and goodwill.
Our aid programme, as part of a principled and creative foreign policy, has the potential to create such goodwill. Ireland has enhanced its reputation when it has taken an international leadership role in such areas as fighting hunger and HIV/Aids.
Keeping to our aid commitment at this difficult time will be noticed and acknowledged in rich and poor countries alike. If we stick by our word, we will be well repaid in terms of our own longer-term self interest.
Tom Arnold is chief executive of Concern Worldwide. He is also a Governor of the Irish Times Trust, proprietor of
The Irish Times