Minister of International Development and Human Rights, Royal Norwegian Ministry of Foreign Affairs, Hilde Frafjord Johnson:

Aid agencies and the fight against poverty: The contribution of the new Norwegian Government

Speech at Overseas Development Institute, London 19 February 1998

Ladies and Gentlemen,

The topic I have the honor and privilege of discussing before you here today is one that is dear to my heart. I was born and raised in Tanzania, in Arusha, at the foot of Mount Kilimanjaro and Mount Mero, where my father was a high school teacher. I have seen with my own eyes, at close range, the small and the great successes and failures of what we refer to as development. Some where caused by the Tanzanians themselves, others by external actors like ourselves. Most where the fruits of some kind of collaboration. The failures have made me approach the challenge of development with considerable humility. The successes are what gives me hope and conviction that the job can be done better and better.

The party that I represent, the Christian Democrats, has always been a strong advocate for positive engagement with the developing world, almost irrespective of whether it is in Norway’s own, direct self-interest to be involved. We believe, quite simply, that poverty and the great divide between rich and poor in the world today presents us with a moral imperative that demands our attention, whether we like it or not. We are obliged to get involved in the fight against poverty. We strongly believe that development cooperation is one of the principal vehicles at our disposal in this fight. It is not the only one, and it has not been utilized effectively enough in the past. The only sensible solution before us is therefore to improve it, to do a better job.

My party’s keen interest in solidarity with the South and in high quality development assistance has manifested itself in many ways. For example, we prepared, while still in opposition in 1996, our own ”Counter White Paper” in response--or should I say protest--to a White Paper of the former Labour government. We called our Counter White Paper “A Policy for Solidarity with the South”.

As a result of the elections in September last year we entered into government with two other parties, (the Center Party and the Liberals), so we now have the privilege and challenge of implementing our own development assistance policy, on the basis of our Counter White Paper while in opposition. This is a very exciting opportunity for us, and for me personally. What makes things even more exciting is the fact that the new Government here in the United Kingdom has established a very similar platform for its development assistance, in the form of the new White Paper of November 1997. This gives me hope that we may be able to work more closely together in the years ahead, both in concrete, on-the-ground development assistance as well as in efforts to bring a larger measure of coordination and consistency into international development assistance overall. Through joint efforts we may achieve so much more than we could otherwise hope for.

My principal aim with this speech is to outline the main objectives and priorities for Norwegian development assistance. I hope that my words will stimulate debate about the challenge we have in front of us and that you will find Norway to be of some interest as an ally and partner in the exciting, albeit difficult, development endeavor.

Enough introduction. Allow me to spend just a minute on some basic facts about Norway’s development assistance program of today.

• Last year we spent roughly NOK 11 billion on socalled Official Development Assistance (ODA), or the equivalent of GBP 900 million.
• This amount represents some 0.88 percent of our gross domestic product. We are currently finalizing a plan to increase our efforts to 1 percent of GDP by the year 2001. Given Norways current annual economic growth rate, this represents a rather significant increase. I should add that strengthening our systems of quality assurance and evaluation is part of the expansion effort, and these results will have direct impact on how quickly we progress. We are not in the business of wasting precious resources just in order to claim a dubious statistical victory.
• Our bilateral development assistance, channeled through NORAD, makes up about 45 percent of the total. Contributions to multilateral organizations and programs (the World Bank, UNDP, UNICEF, etc.) make up another approximately 25-30 percent, while some 25 percent is channeled to NGOs, Norwegian ones as well as local or international.
• Of our bilateral assistance, most of the effort is concentrated in 12 priority partner countries, most of which are in Sub-Saharan Africa and the Horn of Africa: Eritrea, Ethiopia, Uganda, Tanzania, Zambia, Malawi, Zimbabwe and Mosambique. Our non-African priority countries are Bangladesh, Nepal and Sri Lanka in Asia, and in Central America, Nicaragua. In some of these countries Norwegian assistance represents a fairly large share of total donor contributions. In Tanzania, for example, Norwegian assistance amounts to some 6 percent of the total.
• We also have special regional “windows” for Africa, Latin America, Asia and the Middle East that allow us to channel relatively significant contributions to countries that are not necessarily amongst these twelve priority countries.

The overriding goals of development cooperation

The struggle for human dignity and fundamental human rights is at the centre of Norwegian development policy. Our over-arching objective is to contribute to consistent and sustainable improvements in the economic, social and political conditions of people in developing countries, particularly the poor segments of the population. Under this umbrella we are working along four main tracks:

1. Promoting progress towards peace, democracy and protection of human rights, including equal rights for women and men.
2. Combating poverty through advocating and supporting sustainable economic and social development policies, programs and projects.
3. Contributing to improved management of the environment and natural resources, which is a fundamental precondition for truly sustainable development.
4. Contributing to the prevention and mitigation of human suffering in areas of conflict and as result of natural disasters.

The basis of all we do in all these areas is and has to be partnership. Partnership is at the core of our development policies.

The Enabling Environment for Effective Development Assistance: International Trade, Debt, Macro-economic Policies, Donor Coordination

Today we know from experience and empirical research that it is extremely difficult, perhaps impossible, to achieve any meaningful, or sustainable, development if most or all of the socalled macro indicators are pointing in the wrong direction. The key indicators have to do with international terms of trade, the debt burden of any given country, and the macro-economic policies that governments pursue.

In 1988 I spent a year in a village in Tanzania doing field work for my thesis in social anthropology. I lived and worked among village farmers and ”measured” at close range how international prices, debt, government subsidies and lack thereof, and adjustment programs affected these women and their families. Make no mistake about it—these seemingly abstract, almost academic, phenomena about which we publish books, papers and articles are matters determing the life of millions of people. A development assistance program is almost meaningless unless it takes these conditions fully into account.

In addition, the development efforts of many countries are currently being complicated--can I use the term jeopardized--by the lack of coordination amongst us donors. Tanzania has to relate to some 30 donors at the same time, with often very different demands and agendas. There are around 3000 projects in the country. This in itself can be a serious impediment to development. In fact we can, by our presence do more harm than good, if we do not coordinate better. We must therefore do two important things:

1. Work internationally to improve the enabling environment for development, in all arenas where we have influence. This includes: (a) improve the global terms of trade through the WTO system; (b) support the efforts to provide real, effective debt relief through the socalled HIPC initiative and the Paris Club; (c) support--although not necessarily without criticism or conditions--macro-economic adjustment processes led by the Bretton Woods institutions; and (d) get our act together in all donor foras to strengthen donor coordination.
2. The second thing we need to do is to adjust our development assistance programs country by country in light of these framework conditions and the processes we are involved in to improve these conditions. In other words, I am calling for a more holistic approach.

And, to further complicate things, we need to do the above in a recipient-oriented manner, and encourage the active democratic participation of the people affected by the development efforts we sponsor, at the programme as well as the project level. Finally, environmental principles and conventions must be adhered to. You may say it’s a tall order. But this is what has to be done!

Let me add that on the whole issue of debt, my Ministry is preparing a plan to intensify Norwegian efforts. We expect to present it to Parliament in May this year. I look forward to further collaboration with my friend and colleague Clare Short on this important issue as well as many other ones.

Operationalizing our commitments

Turning now to our current development assistance program, within the policy framework described above: Let me state clearly to you again that alleviating and eradicating poverty is the most urgent challenge of our time. My government wants to target its development assistance effort towards poor regions, countries and population groups. This, besides the macro aspects discussed earlier, will determine the structuring of strategies and measures and the use of budget allocations.

Education will be given particular attention. The low priority given to education in Norwegian development assistance has long been the subject of severe criticism, not least by myself. Education is essential for poverty-oriented, sustainable development and meets several development goals simultaneously: reduced population growth, providing a stronger human resource base for industrial and agricultural development, avoiding child labor, reducing gender inequalities, and giving individuals and families more income opportunities. Thus, the Government intends to increase the share of development assistance that goes to education to ten per cent by the year 2000 and to 15 percent a few years thereafter. Our aim is to invest in a wide range of educational programmes, from basic education to higher education and research, although with a strong emphasis on basic education.

Health will also be given more priority than in the past, especially primary health services. As in the case of eduction we want to reach the ten percent target by the year 2000.

While our efforts in health and education will always be relatively small when seen in isolation, we believe that developing countries and donors together will see significant results in terms of poverty eradication if we all live up to the socalled 20/20 commitment. That’s what our commitments to these sectors are all about: to be part of a large, coordinated effort to radically expand education opportunities and improve basic health services world wide.

Increased emphasis on private sector development

When we choose to focus on sectors such as education and health in many of the poorest countries, we must at the same time be aware that our doing so results in an increase in public expenditures in the countries concerned. In the next round, this may lead to more dependence on development assistance and to a heavier burden of debt owing to the need for more loans. This makes it all the more important to stimulate income-generating activities in the private sector, which is the real engine in economic development. Through growth in productive activities, people will find work, incomes will grow, families will be better fed, and the developing countries will gradually be capable of financing their “soft sectors” drawing on their own resources.

Private sector development is therefore an important area of focus for our development assistance. We have started work on a long-awaited strategy for private sector development. Drawing on the lessons of our own efforts to support industrial and manufacturing development in the past and the private sector development experiences of other donors, this strategy will seek to identify the kinds of institutional, technical assistance, and investment interventions that have proven to be the most effective. The role of our own commerce and industries in Norway will also be examined in that regard. Very often such participation have been driven by second agendas. The role of industry and the private sector will now be judged solely in terms of results in creating growth and employment in the recipient country, not in jobs at home. In the past, their involvement has typically been judged in terms of job creation and protection in Norway. This is particularly true for our export credit programmes, which we now are reducing, and which to a large extent have been directed to growth economies in Asia and elsewhere.

That said, let me also stress that we, from a development perspective, strongly encourage commercial involvement by our own private sector in creating investment and activity in developing countries. Development assistance cannot do the job alone. We depend on the willingness of industry to contribute risk capital, administrative experience, competence building and technology in cooperation with investors in the South. Such development is also important so that donor/recipient relationships may evolve to an economic relationship on equal terms.

Human rights

As you know I am not only Minister of International Development—a daunting enough task in itself. The Prime Minister also handed me the challenge of being Minister of Human Rights. Many years from now, when we’re out of Government, I’m going to get back at him for that one. (Just kidding.) In actual fact, the twinning of these two functions makes a lot of sense. Not because human rights violations only occur in developing countries. It makes sense because we believe improved protection of basic human rights must go hand in hand with development. As a matter of fact, development assistance is improving human rights, not the least the social, economic and cultural ones on the ground. I also like to think that the international character of my job as development minister also gives me a good perspective on human rights challenges in Norway and how progress might be made at home.

Turning back to the topic at hand, we believe reducing poverty and meeting the basic needs of individuals are in themselves a means of promoting human rights. In this respect we have to acknowledge that social, economic and cultural rights are as important as civil and political ones. What we do has to be put in this perspective. Going beyond classic development assistance, however, we see in many of our partner countries a need for greater compliance also with civil and political human rights obligations. However, these countries often have a hard-pressed public administration and a poorly developed legal system. Some lack fully developed democratic institutions and have few active NGOs that are able to function as pressure groups to bring about positive changes. Norwegian policy goals therefore include increasing our assistance to the legal system, the electoral system and expertise in the field of human rights, to mention only a few of our priorities. And we regard NGOs both in our own country and in our partner countries as extremely important partners in this process.

While contributing to greater protection of human rights is an important goal in itself, we also view it as part of the overall development effort. Several studies have concluded that development projects are more often successful and achieve better results in countries where civil rights in particular are respected. This is related to the fact that the authorities act in a more responsible manner when the inhabitants enjoy legal protection and where there is room for criticism and scrutiny. In brief, the protection of human rights helps to give the authorities a greater sense of responsibility towards the population, which in turn has a favourable impact in terms of development. Thus there is a close interplay between greater observance of civil and political rights on the one hand and economic development on the other.

Thanks to democratic reforms in a majority of our partner countries, the possibilities for cooperation and results in this field have improved significantly. We are working out guidelines that will help us ensure that our assistance promotes respect for civil and political rights. My Government wishes to intensify these efforts. This is an important supplement to much of our other assistance, which I have already described, albeit cursory.

Still, we must admit that censurable conditions exist in many of the countries we work with. Our decision to continue co-operating with countries is partly sustained by a desire to support their economic and social development while contributing to the protection of human rights and to the development of democracy. At the same time we know a line must be drawn somewhere concerning which countries we can have economic relations with. In cases where it is not possible to establish a real dialogue, we will have to assess the consequences that this has for economic relations.

The poverty challenge

Any attempt to solve the poverty problem in a sustainable way will not only affect the poor, it will affect whole communities. It will change power structures, in economic and political terms. Combatting poverty may imply facing issues that are very sensitive internally in developing countries. It is obvious that it is impossible to succeed without patience and dialogue.

This brings me back to the challenge of closer donor coordination and more recipient-driven approaches to development. This is part of the partnership and a precondition for partnership. Can we, together, encourage a process which allows the intended beneficiaries of our development efforts a real role in planning and implementation? Can we do this without violating the principle that we are partners in development with recipient governments? These are real challenges we face in many countries. That is why we are thinking of shifting from a project approach to sectoral programmes. The idea is that the partner country sets up its own sectoral programmes, and takes the lead, being in the education sector, the health sector, infrastructure or other sectors.

With the partner country in the driving seat, the various donors have to relate and adjust their programmes in relation to the countries’ priorities. In this way the donors can coordinate and agree on a division of labour. This is crucial, and a way of working out a partnership on the ground. I hope we can face them together and find workable solutions together, working with the UK and other donors.

I would like to make one point concerning poverty orientation in general. The need to be selective in the choice of partner countries has been much emphasized in relation to discussions of increased use of performance-based conditionality. We can all agree that by focusing on how well a country follows up the priorities that have been agreed on with the donors, and by reducing disbursements to countries with notoriously bad reform track records, we can certainly utilize aid money more efficiently. However, there is a concern related to the situation of the poorest countries. Less concentration on the least developed countries is a international trend. We should keep in mind that although concentrating on the best performers may improve our disbursement rates, we will probably be more effective at alleviating poverty if we concentrate instead on the poorest countries among the good performers, or on countries that are at least willing to move in the right direction. Maybe we should consider giving priority to the two latter, and help the poorest countries become good preformers? This needs a nuanced approach, and it is not the least related to partnership.

Closing remarks

Just three weeks ago I visited Arusha, my birthplace, as part of a one-week East African tour that included Uganda, Rwanda and Tanzania. It was nice to visit my elementary school, where the little boys and girls were wearing the same green uniform I used to wear, Tanzanian teachers were still doing an excellent job, and the same turtle I used to ride on was still hanging around in the back yard. What made the biggest impression, however, was a visit to the local offices of PRIDE Tanzania, a microfinance enterprise established with our support. PRIDE Tanzania has expanded in an almost explosive fashion and is opening chapters all over Tanzania. I saw with my own eyes how effectively they work in empowering poor people to help themselves.

Development assistance can contribute significantly and positively to eradicating poverty. This fact is more than reason enough to be involved and to stay involved. This rationale is also the kind of rationale that generates public support at home for development assistance. Relying on arguments such as economic and political self-interest, on the other hand, is not only wrong, it has also proven to be a very poor way of building public support. Let’s stay focused on what really matters; helping the poor and the poorest.

Thank you for your attention.