Development cooperation needs to be rethought

Development cooperation cannot rely on old assumptions as funding falls and the geopolitical environment changes, writes Ville Tavio, Finland’s foreign trade and development minister.

He says the results of more than 50 years of traditional development cooperation should be examined closely. The United Nations list of least developed countries now contains 44 states, while only eight countries have left the category over the decades. Aid alone, Tavio argues, has not lifted countries onto their feet. Structural reforms within those countries and the willingness of local decision-makers to pursue them are also necessary.

The financial outlook has changed sharply. Global official development assistance fell by a record 23 percent last year, according to the article, and the OECD expects the decline to continue this year. Finland plans to cut development cooperation by a total of 1.34 billion euros during the current parliamentary term as it seeks to balance public finances. With less money available, Tavio says its use must be reconsidered.

The government has also made Finland’s economic interest part of its development policy. Tavio points to a 45-million-euro Wärtsilä power-plant technology sale from Vaasa to Ukraine as the largest deal in Finland’s development history. Bringing private-sector funding into development projects can increase their impact beyond what aid money alone could achieve, he writes. The aim is to replace one-sided aid with arrangements that benefit both sides.

Humanitarian funding will continue to provide essential emergency assistance in crises, while support for civil-society organizations remains in place. Tavio says organizations should also pursue more partnerships with companies based on reciprocal interests. As foreign and security policy increasingly follows economic considerations, Finland must strengthen competitiveness, open markets and increase exports, he writes.