Analysis

EU-ACP relations : Building for tomorrow

by Kenneth Karl

1989 saw the end of the Yalta inspired twin-superpower dominance. Nations had to examine their priorities in their desire for integration in an international environment in which geostrategic and economic realignment would be unavoidable. The philosophy which had served as a basis and reference point for North/South relations throughout the Cold War period is now being called into question and necessary adjustments in ideas have been triggered.

The Lomé Convention, which governs the development-cooperation relationship between the EU and the 70 ACP countries, is a unique North/South cooperation agreement on account of its contractual nature, its durability, the funds it allocates and the fact that it provides for a permanent dialogue. But it is also now at a decisive point in its history.

Those who regard the Convention as out-of-date and in need of renovation, and those more radical critics who believe that it no longer serves any useful purpose and must be phased out, both argue that a new direction is needed.

- Beyond all the criticism formulated against this system, the fundamental question remains as to whether the Lomé Convention will be able, given the necessary changes, to carry on after its fourth version expires.

The years between now and the end of the century will, naturally, see the application of the revised Lomé IV, including the substantial improvements made to it. However, this same period must also be used to prepare the ground for ACP/KU development cooperation in the future, whatever form it might take.

Shortly after his nomination as European Commissioner for relations with the ACP countries and South Africa, Professor Pinheiro commented, realistically, that the ACP countries are no longer 'in fashion'. The change of emphasis can be seen clearly if one looks at the EU's burgeoning relations with its eastern neighbours from the former Communist bloc (illustrated by the wide range of European programmes now benefiting these countries). One might also cite the strengthening of ties with countries in the Mediterranean basin. Economic and security concerns underpin this development, but it undoubtedly reduces the significance which was once accorded to the ACP states.

Moreover, the economic objectives of virtually all EU countries, as they seek to reduce budget deficits and deal with increasing internal social problems inevitably put pressure on the amount of development aid being granted to the Third World.

This situation is, of course, not restricted to the European Union - which in fact remains the world's main contributor of official development aid. At the instigation of a Republican dominated Congress, the United States is planning much more swingeing cuts in its contribution, both to certain international agencies and to certain regions (including Africa).

This undeniable cutback in public development aid has been offset in recent years by net increases in private capital flows, but the geographical distribution is highly skewed. Only a few of the poorest developing countries have benefited from the trend, the main 'winners' being the emerging states of Asia. These include countries such as China, India and Indonesia which, it is worth noting in passing, do not have particularly good human rights records, in the sense that the term is understood in Europe. Despite the fact that ACP countries have identified potential for attracting foreign investment, they have not actually benefited from this change in resource flows.

In this climate, with official development aid in inaeasingly short supply, innovative methods for making optimum use of the available resources must be devised within the context of the Lomé Convention.

On current indications, it is quite possible that in the year 2000, the Lomé Convention will be filed away in the archives. ACP/KU relations will certainly have to be more in step with recent developments on the international scene. The initial reasons for the establishment of a cooperative relationship between Europe and the ACPs, following the signature of the Rome Treaty, are now outmoded. As Paul Valery has commented: 'One of the worst mental aberrations is to think that things can survive when the reasons for their existence have gone'.

So, what type of development cooperation should the countries of the European Union and their ACP partners aim for in the future ?

Alternative trends

The EU has stated that it is in favour of a globalisation of aid within an innovative framework. One of the first questions to be asked is whether uniform cooperation with regions whose monolithic character is being increasingly called into question is still desirable.

Variable geometry in development cooperation relations is increasingly being seen as the trend to be followed.

If this option is chosen, there is a risk of the following scenario being created: The EU's relationship with the Caribbean could become diluted within its relationship with Latin-American countries and links with the Pacific countries could become confused with economic relations with Asia. What would then become of Africa, the continent needing most attention on account of the wide range of its difficulties and its increasing marginalisation ?

In 1990, the United Nations General Assembly, aware of the African question, adopted a new agenda on development in Africa, thus making that continent its number-one priority. Europe, on the other hand, must not simply focus on Africa but must invent new modes of action which are more concrete and more effective.

Secondly, recent trends imply greater conditionality. This has been taken on board not just by EU Member States. A number of multilateral aid agencies have also included it in their strategy. The OECD's Development Aid Committee believes that future relationships between North and South will be greatly influenced by conditionality and, indeed, the Organisation goes so far as to advocate this approach.

However, conditionality in terms of development is a strategic element which must be handled with extreme caution. If cooperation, whether today or in the future, is to be based on conditionality, then it can only be rendered effective if aid recipients (both governments and the governed) are genuinely committed to the idea. They must be convinced, in a climate of resource-scarcity, than the approach is motivated above all by a desire for greater success.

The European Union thus has a vital role to play, making full use of its advantages in terms of dialogue and consultation in order to prevent conditionality being perceived as a condescending mechanism. Thereby, it can help to prevent conditionality from generating the well-known perverse effects of 'tied' aid.

Of course, conditionality raises the thorny question of national sovereignty, but it is important to observe that modern international relations have moved on, both de jure and de facto, from a concept of absolute sovereignty to one of relative sovereignty. This is illustrated by the trend towards humanitarian intervention as a right, the requirements of the Bretton Woods institutions, supranationality in certain regional international organisations, and the very fact of world economic interdependence.

This does not mean that the developing states should sell off their sovereignty to the highest bidder but that conditionality should be the subject of negotiation. Donors must be more flexible in their demands and thereby give the country in question such room to manoeuvre as is necessary for programmes to succeed.

Thirdly, development of the private sector appears now to be approved by all parties. Since independence, the State has been omnipresent and omnipotent in most productive areas of ACP economies. Given the failures of the public sector, private enterprise is now being called in to help. Its development is one of the sector specific policies which will and must receive most support.

The development of the private sector must permit better distribution of the fruits of the growth that it generates and promote integration of the ACP countries into the market economy. There can be no question of pitting private enterprise against the public sector, because any Manichean approach in this sphere might prove to be risky. It is important also to stress that free market development cannot take place overnight and that it is subject to inescapable macro and microeconomic preconditions.

Indeed, the birth and expansion of a dynamic private sector depends on the politico-economic fabric. This includes reliable financial bodies, functioning financial intermediation, adequate infrastructures, technical qualifications and training, a suitable legal/ regulatory framework, institutions to support private businesses, the channelling of the informal sector and a public sector which is prepared to play fair, aware of its regulatory role. These, in short, are the necessary ingredients for the adjustment of the private sector to permit the development of a true enterprise culture.

The development of a harmonious private sector will make it possible more easily to achieve the transformation and export objectives required by international competitiveness. It should, therefore, help to counteract the erosion of commercial preferences generated by the Uruguay Round. The latter's time limits should, in any case, be extended, because it seems clear that the ACP countries will be unable to fulfil their obligations by the end of the moratorium obtained by the EU during the negotiations.

The notion of compensating for inequality that is found in international development law, implies the adoption of a normative system to counteract the weak trading position of developing countries vis-a-vis their competitors in the North. But in recent times, this idea has been losing ground and it is unlikely to cut much ice with the WTO authorities. Legal equality in a situation where there is structural inequality is not, in fact, equitable, and it is therefore necessary to find some other way of mitigating the adverse effects, looking at it in a global context.

Promotion of domestic and foreign investment should be better supported. People talk of the 'risk/ country' threshold that deters foreign investors. It may be that this can be measured objectively by looking at economic and other indicators, but even if this is not possible, it clearly exists as a psychological barrier. This is a problem for many ACP countries and it needs to be crossed, using measures which tackle the many obstacles to investment.

Changing the culture of development cooperation

Besides all the technical aspects, one could argue that the shortcomings of the Lomé Convention stem also from the perceptions of those involved in development cooperation. In short, it is the actual concept and culture of development aid which must be changed.

On the European side, the colonial legacy has conditioned attitudes, imprinting on them a dominant patemalism which is prejudicial to the aim of development. This European concept of cooperation must be overturned. Moreover, development cooperation must not be seen as the art of the possible but as the art of making possible what is strictly necessary, by virtue of genuine negotiation with the countries which have resolved to move forward.

Moreover, it is desirable to have a better developed policy of informing European public opinion about development cooperation. An effort is needed to counter false impressions, such as the one left by the French journalist who wrote: 'Official development aid is like taking money from the poor in rich countries to give it to the rich in poor countries'. Better information is needed to ensure that the public can decide such matters for itself.

Coordinating the Union's policies with those of the Member States now presents an enormous challenge. The political obstacles are huge and development cooperation may well suffer as a result of them if the objectives of coordination, coherence and complementarity contained in the Maastricht Treaty are not achieved.

As for the ACP countries, success in their economic development depends on many factors, cooperation being only one of them. Many political leaders in these nations have too often described cooperation with the North as the only way in which they can develop. In fact, this should be seen as nothing more than an additional factor - supporting the national effort and a genuine desire for development. It is pure fantasy to believe that development can be set in motion solely on the basis of an external impetus. To succeed, it must come from within a country. This is why future cooperation between the EU and the ACP countries must progress towards reinforcing the aptitude of the latter to devise, master and control their own development process.

In the future, the ACP countries must propose concrete and responsible solutions to their partners, doing so by means of the dialogue system. They must also promote development based on participation, particularly with the involvement of young people and women.

The fact that the ACPs can offer a credible prospectus for development must be acknowledged. It is undoubtedly a challenge, but it can successfully be overcome if a climate of stability, security and confidence is created, matched by an unambiguous political will.

In KU/ACP relations, programmes must include the long-term vision necessary for sustainable development. Too often in the past, the strategy has been aimed at an immediate and ostentatious result. Successful development in the future will depend crucially on a change in such attitudes.

K.K.

Let us know what you think

The debate about the future of cooperation between the European Union and the ACP states is now beginning to gash' pace. Last year, we established the 'Analysis' section in The Courier to report on this debate-and give readers an opportunity to express their own views on the subject.

The response so far has been encouraging, but it has come mainly from the European side. We are keen to receive contributions from ACP readers as well. If you have you own ideas or opinions about what should happen after Lomé IV expires, why not put them on paper and send them to us. Our address is on the inside front cover of the magazine.

The view of civil society on the future after Lomé IV

This was the subject of a conference which took place in Maastricht from 12-14 June, under the auspices of the European Centre for Development Policy Management (ECDPM). It brought together participants from ACP countries and Europe, including representatives of civil society (NGOs, the private sector, etc.). Four major topics were addressed:

· How can a new KU/ACP commercial relationship be constructed ?

There was agreement that some form of preferential trade regime should continue after 2000. Some participants stressed the need to Promote 'fair trade', which would contribute not only to growth but also to development. The impact of individual trade preferences is not always clear-cut, but obviously there cannot be a single solution covering all problems in all ACP countries. An analysis of negative constraints demonstrated the difficulties involved in reconciling the rules of the Lomé Convention and those of the World Trade Organisation.

· How can the private sector become involved in development ?

The most important aspect of this topic is knowing how to create a favourable and business-friendly environment which will enable the private sector to play its part-and the role the European Union could play in this process. The private sector was defined as both formal and informal, encompassing large, medium and small enterprises, whether local or foreign. The importance of a strong local private sector in guaranteeing long-term stability was particularly emphasised. In this respect, the view was expressed that the role of the state and its relationship with the European Commission should be redefined. There was also a call for time to be set aside time for effective dialogue, and to create the space for a partnership between the public and private sectors. It was felt that the role of Economic and Social Councils should be expanded and specified more clearly. As for the specific issue of privatisation, the point was made that this should not be seen as a panacea and that it should be approached on a country-by-country basis.

As regards current instruments, it was noted that their objective is essentially to meet public-sector requirements. The role of the Centre for the Development of Industry (CDI) attracted some criticism. Speakers felt that the private sector should be more involved in the preparation and implementation of cooperation programmes with the European Community. Direct financial support to the private sector was seen as desirable, including backing from the European Investment Bank.

· What partnership ?

The partnership concept was seen to have been eroded over the past two decades, with the pretext of efficiency resulting in a more paternalistic approach. Mechanisms needed to be found to enable EU priorities and the prerogatives of ACP countries to be reconciled. Reference was made to the political nature of the origin of the partnership and the need to find a new political raison d'etre for this type of relationship. The problems of cohesion within the ACP group and its relations with the EU were also raised, and there was a discussion about the possibility of giving the Convention a regional character-although a number of speakers expressed reservations about this.

On the European side, two lacunae emerged, namely coordination between donors, and consistency between Lomé and other Community policies (including relationships with the Bretton Woods institutions).

In addition to the principle of partnership, some participants were keen to stress the motives of solidarity and common interest that lay behind cooperation. It was not simply a matter of 'negative' interdependence. The appropriateness of the term 'partnership' was questioned, if this was only to mean financial and technical cooperation. The politicisation of Lomé appears to be on the agenda, involving a move from the current partnership to a genuine 'contractual approach' through political dialogue.

As for the role of partnership in cooperation policy management, it was felt essential that civil society and the private sector be involved. There was also a discussion of the debt problem.

· How can financial and technical cooperation be improved ?

As usual, reference was made to the need to simplify and differentiate management of Lomé Convention instruments, particularly in the context of the programming process. As regards the role of non-state actors, a cautious approach was recommended. Finally, new instruments were called for to prevent conflict.

· Conclusions

This conference, coming after several others of the same type, was characterised essentially by private sector and NGO calls for greater participation in Community cooperation policy. Moreover, the need for 'politicisation' of the Lomé policy, shifting from purely financial and technical aid to a genuine cooperation contract, seems to have attracted the support of all participants. These questions are sure to figure in the 'Green Paper' on 'tome after 2000', which the European Commission plans to publish before the end of 1996.

Dominique David

'Democratising democracy'

On 6 and 7 June, the Belgian Par/iament hosted a UN seminar on 'me future of international development cooperation: new communication challenges' 'Democratising Democracy' was the succinct, journalistic way in which one of the speakers at the meeting summed up his solution to the problem of underdevelop meet. He was Jean-Bertrand Aristide, former President of Haiti, who observed that democracy, as advocated by the developed world, and increasingly accepted by developing countries, does not prevent the latter's slide into even greater poverty. The Courier had the opportunity to interview Mr Aristide. We began by asking him whether his statement implied that democracy is failing in a world striving to 'globalise' it J-B.A.-The word democracy comes from the Greek words 'demos', meaning people and 'kratein', meaning to govern. In other words, it signifies government of the people, for the people by the people-but if we take a look at the world today, the impression we get is that not all so-called democratic governments are in fact what they purport to be. Hence the need to 'democratise democracy', so as to create a situation in which all citizens can help set governments on a course towards such a model.

Concepts usually generate conflict and, therefore, when speaking of revolution, democracy or globalisation, it is necessary to be au fait with the subject matter so as not to become involved in a dialogue of the deaf. In the specific case of globalisation, my opinion is that this has a tendency to make what is an already precarious situation even more unbalanced. Concepts cannot be applied everywhere without thought being given to their harmful consequences. This does not mean to say that we should give up completely. It's one thing to speak of the globalisation of peace, as if an ineluctable need existed to promote peace on a world scale, but I'm not sure that everyone would define the globalisation of peace in the same way as I do.

· Could we turn now to your own country, Haiti. How do you view the future of democracy there, bearing in mind the economic circumstances ? At the seminar, you mentioned several factors which demonstrate democracy's *agility.

-Democracy is indeed fragile. 1% of Haiti's population owns 48% of the country's wealth and it is estimated that about 65% of the working population is employed in agriculture as against 5.1% in the 'industrial' sector. But is this really the true picture ? Reality for most people is poverty-unacceptable and sub-human poverty. A man needs work to earn his daily crust by the sweat of his brow, but unemployment has reached catastrophic proportions. When people are unable to earn their living, there is little point in discussing the positive influence of democracy. What is needed is for those with a great deal of wealth and those with less wealth to talk to each other; a dialogue between the private and public sectors, so that we can head off futile conflicts and devote all our efforts to economic growth coupled with human development. I do believe that this is possible.

· Yet, the rich are so rich and the poor so poor. Is it not fantasy to think that the gulf which separates them, and their mutual mistrust, can simply be set aside so that genuine dialogue can take place ?

-This is one of the challenges we have faced ever since 1960 and, although we have not yet reaped the harvest of this process, we have to carry on. It's not too late. We just have to approach the subject logically and with all the facts to hand, and we must have the intelligence to be patient. If we continue with dialogue, we will achieve real results. Only the citizens of Haiti can play a part in Haiti's development-this is not a task for outsiders. We, on the other hand, have to be more receptive to international cooperation, while maintaining mutual respect and dignity. But what we also need is for our own people to act together in order to enhance our own growth. This is not to say that geopolitical reality can be disregarded. Other countries have to be taken into account, but, as a starting point, we have to consider Haiti's human and material resources.

· Thereisdialogueata world level, but there are rules to be applied. I am thinking, here, of free competition. Haiti has to play by the rules, just like any other country.

-Since we gained independence, our history has seen a succession of coups d'etat and people have been over-eager in brandishing weapons to solve economic, political or social problems. Now that democracy has been restored in Haiti, weapons are not the solution to our problems-I cannot stress this enough. What we need is for those with money to sit down and negotiate with those who have none: for the government to get people round the table and devise a common plan to accommodate all interested parties- looking at both the nation's interests and the interests of investors. I do believe that it is possible to achieve this. We have, in fact, already begun to prepare the ground. I am not basing my words, here, on pure theory, but am speaking from experience. In concrete terms, we have to transcend class and racial differences to recognise that Haitian men and women, regardless of their colour and the country they might live in outside Haiti, regardless of their nationality, even, are still part of Haiti's indigenous population. The way must be kept open for dignified and balanced cooperation.

· The other point you mentioned today was that there can be no development without the effective involvement of the population. Are you not leaving yourself open to accusations of having socialist or even communist tendencies ?

-As I have just said, we have to be scientific in our approach and check our facts over and over again. I fail to see how anyone can claim to be working towards peace without looking at poverty which is the greatest threat to social cohesion. Of course, there are those who would deny this assertion, and that is their right. However, rational analysis of the situation can help us alleviate poverty and promote security. It needs to be underlined that security is also one of the essential factors in economics. The UN Security Council is called in to prevent or resolve conflicts. To my mind, we should also be talking about an economic security council to deal with the economic realities. The deeper one plunges into poverty, the greater one's feelings of insecurity-the two always go hand in hand. And insecurity can crop up anywhere in the world. Nor is it a question of charity. It is a real, rational question which must sharpen our awareness, stimulate our common sense and set us on a course to protect the world by alleviating poverty. That, at least, is one approach.

At the same time, you have to recognise that politics is essentially a question of power while economics is influenced by interests. Everyone uses the means at their disposal to defend their personal interests and we know perfectly well that there are no free gifts. The so-called developed countries allocate just 0.3% of their GDP to development aid, yet we are losing our tropical forests at the rate of the area of a football pitch every second. In Haiti, forests now cover only a small area of the country. But in the final analysis, environmental catastrophe threatens us all, rich and poor alike, even if certain countries do not face specific ecological risks. We either deal with it as reasonable people, or we close our eyes to the 'cause and effect' realities.

· Yes, but are we reasonable people ?

-The crisis of ethics is indeed a reality and a great many values are now being called into question. These days, we have to love in order to prove we are not contradicting ourselves. If we believe in God, we might call this love 'God', just as we might call it 'justice'. It all depends on your philosophy, religion or beliefs. If I feel love, I cannot be indifferent to the situation of victims of injustice, both in Haiti and elsewhere. If a man is humiliated, crushed, exploited or marginalised, then 1, too, am humiliated, crushed and marginalised. It is love which makes us fight for justice everywhere. Either one is a demagogue revelling in big words or one is sincere and ready to die so that another might live-this brings immortality.

· One final question. You were speaking just now of insecurity and economics. Is there a link, here, with one of your most recent decisions, the abolition of Haiti's army ? Could you tell us how you were able to pull off this 'coup'?

- I am perfectly happy to answer such an important question and would like to be able to give a clear and direct reply. But given that the struggle is still going on, I don't think I should go into too much detail. A decision was made. The Haitian people opted to rid themselves of the army. Supporting their democratic wish, it was our job to help bring about this dissolution. The army, it is worth recalling, had about 7000 men, absorbed 40% of the national budget-and had killed many of our compatriots. We have had to be logical and patient in achieving this goal, bearing in mind that the guarantors of the agreement which led to my return had their own views, which were different from ours. We also needed courage and wisdom and, above all, the determination of the people. My motto has always been that it is better to fail with the people than to succeed without them, and in this we did not fail. Our task now is not to bask in our own glory but to continue the work of structuring the police force, to prevent it becoming another army. To achieve this, we have to make steady progress and use sound judgment.

Interview by Hegel Goutier