In an open letter to EU development ministers posted on his blog, Development Commissioner Andris Piebalgs has set out his vision for EU development policy. The central point of the letter is that EU aid needs to be refocused to promote economic investment in developing countries, because “only through catalysing jobs and growth in the developing world will the viscous circle of aid and dependence be broken”.

Piebalgs writes: “Even if all the aid granted by the EU were to be focused on the world’s poorest countries, it would amount to a very limited figure for each of their citizens. When we meet our 0.7% commitment, this figure will of course increase, but we should have no illusions that aid alone will achieve the goal of eradicating global poverty and giving all the world’s citizens an independent economic future. In this light I believe that it is vital that we focus on getting real “value for money” from the aid granted, ensuring that it acts as a catalyst for growth and jobs in the developing world; that every Euro granted leads to as much as 10 or more Euros in investment.”

On the recent increase in the proportion of the EU’s aid budget that has been provided in the form of budget support, Piebalgs writes: “I am convinced that this can be an effective manner to create leverage from aid through its combination with nationally raised money. However, after this initial experience at Community level I believe that a thorough evaluation of how and when such an approach has been successful is necessary.” He announces that the Commission will shortly be launching a public consultation on the role of budget support in development aid, “with a view to a future Communication identifying best practice”.

Reacting to the letter, Eurostep Director Simon Stocker comments: “His central thrust is that development policy must be re-oriented towards promoting growth and employment in developing countries. This may be true, but is this new? The question is not only about what strategies work to do this, but also how this leads to inclusive development.”

He adds: “[Piebalgs] also indicates there is an aim to increasingly harmonise the timing of the development aid programming cycles within the EU (between member states and the Commission). This is clearly consistent with the aim to make EU development cooperation more joined up and consistent. It could also lead to an increased use of a common EU capacity. But could it also lead to a repatriation of aid budgets to the Member States?”

You can read Commissioner Piebalgs’ letter in full at: http://blogs.ec.europa.eu/piebalgs/letter_to_ministers/