7-8 JUNE 2017 / Tour & Taxis / Brussels

Development today: do middle income countries lead the way? A close look to the South-South Cooperation

Development today: do middle income countries lead the way? A close look to the South-South Cooperation

EDD17 - Replay - Development today: do middle income countries lead the way?

auditorium
A3
Thursday, June 8, 2017 -
09:00 to 10:30

Key points

  • South-South cooperation is on the rise, especially in Latin America.
     
  • So is ‘triangular cooperation’, which adds partners from the developed world.
     
  • Many Latin American countries are being reclassified as ‘middle income’, which can make them less likely to receive official development assistance (ODA) from rich countries.
     
  • The European Consensus on Development, the European Union’s latest framework document for development policy, could open the door for a shift from ‘aid’ to ‘cooperation’.

Synopsis

South-South development cooperation is increasing, especially in Latin America. The same goes for so-called ‘triangular cooperation’, which adds a developed world component to the equation.

The traditional donor-recipient relationship is also being transformed as many Latin American countries have been reclassified according to international norms as ‘middle income’ – a category that can mean they are less likely to receive ODA from rich countries.

Honduras, now a ‘lower-middle income’ country, remains acutely vulnerable to the effects of climate change and faces huge food security challenges. Reclassification extends beyond Latin America. Now the small African nation Cape Verde has become a ‘middle income’ country, a minister marked to one of the panellists: ‘But nothing has changed!’

Then comes the European Consensus on Development, the European Union’s latest framework document for development policy, which could open the door to a shift from ‘aid’ to ‘cooperation’ and perhaps create more space for triangular cooperation. The minimalist equation Development = ODA no longer adds up.

While the financial component could be diminished, European cooperation in Latin America is likely to continue in areas such as climate change, trade, security and technical assistance.

All Latin American nations both provide and receive international assistance. Most have specific agencies responsible for their ODA outlays and related cooperation, and all operate mostly within the region. Honduras is working with Ecuador in the coffee sector, for example.

Often this work is undertaken as part of triangular agreements that include EU member states, notably Spain and Portugal. Some Latin American countries, such as Brazil, have begun to provide assistance to countries in Africa.

Despite gains in per capita income, the battle against poverty is not over in Latin America. It has just become more complex. Nearly three-quarters of the world’s poor are reported to live in middle-income countries. In addition, many members of the so-called new middle class remain vulnerable to falling back below the poverty line.

The institutions of many countries in the region, such as tax administrations, need to be strengthened. Corruption needs to be tackled, and education systems must be modernised to meet the needs of 21st century students, many of whom will become entrepreneurs instead of employees. Women need to be empowered, climate change must be addressed, and the list goes on.

In this context, some observers believe that per capita GDP should be abandoned as the main indicator of well-being and, by extension, qualification for international cooperation.

Even as they boost South-South relations, Latin Americans worry that the widespread reclassifications could exclude them from the broader development cooperation scene. Dialogue, partnerships and alliances should be used to reach the goal of cooperation rather than aid.

Insight

With rapid growth in many developing countries, and the continued emergence of China as an economic powerhouse, the world’s centre of gravity has shifted away from the Atlantic ocean. The repercussions for development are multifold, and include China’s investments in infrastructure in Africa. For example, the Chinese led the way in building the recently inaugurated Nairobi-Mombasa railway. But its growing role abroad offers a new twist as it still faces enormous development challenges at home, including poverty, insufficient infrastructure and uneven regional development.

Organised by

  • Moderator
    Cristina Manzano
    Editor at "ESGLOBAL" and "Pensamiento Iberoamericano"
  • Maria Dolores Agüero
    Minister of Foreign Affairs
    MFA - Honduras
  • Jolita Butkeviciene
    Director for Development Coordination - Latin America and Caribbean
    European Commission - DG for International Cooperation and Development
  • Silvia Flores
    EDD Young Leader, Peru
  • Rebeca Grysnpan
    Secretary General
    SECRETARIA GENERAL IBEROAMERICANA
  • Mario Pezzini
    Director
    OECD Development Centre
  • Luis Tejada
    Director
    Spanish Agency for International Development Cooperation
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