WASHINGTON – In the midst of financial turmoil and institutional crisis, it is easy to be cynical about the European Union’s Nobel Peace Prize. But the EU’s past achievements — creating the European Community, advancing economic integration, and helping former Soviet bloc countries transition from dictatorship to democracy — are deserving accomplishments. And yet its commitment to human rights, freedom, democracy, and justice was never intended to be exclusively for Europe, a principle that manifests itself today in European development policy.
The EU is the largest provider of foreign aid worldwide and offers market access to developing countries through low or zero tariffs. Each year, EU commissioners, parliamentarians, and officials meet with representatives from the developing world at European Development Days (EDD) to share lessons on how best to address poverty in a world where 1 billion people still go hungry every day.
This year’s EDD — which tacked inclusive growth and food security, with an emphasis on the private sector — revealed a deep skepticism of the mantra that economic growth is the ultimate answer to our problems. In many developing countries, the link between growth and poverty reduction has weakened: for each additional percentage of GDP growth, fewer lives are improved. The lack of inclusivity is also now a global problem, as income inequality features more prominently in both the United States and Europe. And in some fragile states, growth can even prove disruptive, generating social unrest or conflict by marginalizing segments of society.
How does a nation facing severe poverty simultaneously raise incomes and strengthen social bonds among its citizens? By investing in access to basic services such as water, health, or education? By strengthening governance? By supporting entrepreneurs to create jobs? Typically donors have brought their own prescriptions to these problems. At EDD, deep social engagement among partners was called for in order to spark real transformation. Such dialogues, especially around agriculture — where most of the world’s poor work — could help produce inclusive growth and lift millions out of poverty.
To address the issues of inclusivity and dialogue with local partners, the EU launched its paper “The EU Approach to Resilience: Learning from the Food Security Crises” on the eve of EDD. The paper recognizes that poverty is about working with the most vulnerable, those living in parts of the world enduring frequent and intense droughts, climatic changes, economic shocks, and conflict. The utter desperation of individuals in the Sahel and Horn of Africa come to mind. Those who have not already been displaced by famine are farmers or pastoralists with no incentive to invest in new seed varieties, livestock health, or modern technologies. They cannot access capital since lenders perceive high risks and there is inadequate finance to build warehouses, roads, or irrigation so as to boost productivity.
The EU proposes a policy of “resilience,” which links humanitarian relief — the provision of food, shelter, and medical assistance for those immediately facing starvation — to longer-term development. For instance, in the Horn of Africa, the EU has focused on early warning systems but also financing for agriculture production, nutrition, livestock health, water supply, natural resource management, trade, and research and development. Going forward, public-private partnerships as well as insurance schemes, food reserves, and access to markets and financial services will help households prepare for shocks and prevent them. The paper also wisely highlights the “hidden crisis” of malnutrition, which kills 2.6 million children each year. Malnutrition stifles human cognitive development and undercuts workforce skills and GDP by an estimated 2-3 percent each year, creating a major source of vulnerability for societies.
Crisis prevention is not a new idea. In the wake of conflicts in the Balkans and Rwanda and the humanitarian disasters of the 1990s, a good amount of research was done on prevention and addressing the root causes of crises. The real test for the EU will be translating resiliency policy into practice. Both EU Development Commissioner Andris Piebalgs and Commissioner for Humanitarian Aid and Crisis Response Kristalina Georgieva strongly endorsed this approach at EDD and they have already begun to operationalize it through two initiatives: the Horn of African Resilience (SHARE) and l’Alliance Globale pour l’Initiative Résilience Sahel (AGIR).
Will Europe live up to its legacy as a peacemaker? The upcoming EU budget debate threatens efforts to prevent crises in a more effective manner as pressure builds for austerity. This budget will set EU spending between 2014 and 2020, and includes the 2015 deadline for achieving the Millennium Development Goals. As member states enter EU budget negotiations and consider cuts to their own bilateral programs, they should think hard about the consequences of abdicating their legacy.
By walking away from these more effective development investments, EU leaders put at risk more lives and will incur bigger costs down the road from intensified climatic events, never-ending cycles of humanitarian relief, and conflicts in fragile states. Austerity like this would be bad policy and a catastrophic failure in leadership.
Jonathan White is a Transatlantic Fellow at the German Marshall Fund of the United States in Washington.