The real "poverty barons" are multinational companies

Foreign aid should be investigated, but in the right way

 

On Monday, the new International Development Secretary Justine Greening launched an investigation into the millions of pounds of UK aid money diverted into the pockets of private sector consultants such as the staunchly pro-market Adam Smith International (ASI), following an investigation by the Sunday Telegraph.

This is certainly welcome news. The World Development Movement has for years argued that money made by highly paid consultants like ASI, forcing privatisation, is a dubious use of public funds at best. As early as 2001, ASI was paid to facilitate a water privatisation project in Tanzania, including earning a handsome £250,000 to promote a pop song.

But the worrying thing is that the use of the aid budget in this way is only the tip of the iceberg.  Increasing consultancy spend is part and parcel of a wider undying faith that DfID has in the private sector to deliver poverty reduction.

In one stark example, UK aid money is currently paying for consultants to advise the Bangladeshi government on the establishment of new special economic zones aimed at attracting private-sector investment. Existing zones give multinational companies tax holidays and subsidised land while placing severe restrictions on trade union activity to an extent where the average wage inside these Bangladeshi "export processing zones" is around £30 a month. Here, the scandal goes well beyond the approximately £14m that we are paying the consultants. The heart of the issue is the fact that we are using aid to support a project that will do everything to benefit multinationals like Adidas, which made 671 million Euros in profit last year, and next to nothing for the supposed beneficiaries.

But the government’s pursuit of development policy that focuses on the private sector doesn’t stop at promoting pro-market solutions through consultants. Increasingly, we are seeing multinational corporations replace aid agencies, governments and NGOs as the implementing partners in aid projects.

For example, DfID’s Girl Hub project aimed at getting policymakers to prioritise the needs of girls is being implemented by the Nike Foundation. At the hunger summit hosted by David Cameron during the Olympics, it was Unilever and Glaxo Smith Kline, not NGOs or governments who were named as the major partners.

The problem with all this is that the core assumption – that private sector solutions will be somehow better and more efficient than public sector oriented ones – is based on ideology, not evidence. Nike’s Girl Hub project was slammed as having “serious deficiencies in governance” by the independent aid watchdog ICIA.

There have been myriad inquiries into aid policy over the past decade, but none have broached the key question that needs to be answered: do pro-market, private sector models of development work better for the poorest people than approaches that focus on using and strengthening the capacity of the public sector? The World Development Movement’s 2007 research on water provision showed precisely the opposite.

Justine Greening should look towards supporting an independent Parliamentary inquiry into this broader and more vital question, and put ideology aside and in the interests of genuine poverty reduction. Until this happens, there will remain doubts about whether the government is serious about an aid programme focused on the poor rather than promoting market ideology alone.

Deborah Doane is director of the World Development Movement

Food aid is collected in a Kenyan refugee camp. Credit: Getty Images
ROBERTO SCHMIDT/AFP/Getty Images
Show Hide image

Unlikely sisters in the Gaza Strip

A former Jewish settler in Gaza recalls her childhood friendship with a young Palestinian.

It was well after midnight, one summer night in 1995, when Inbar Rozy, a 13-year-old living in the former Israeli settlement of Alei Sinai in the northern Gaza Strip, heard her parents answer the phone. Sitting up in bed, surrounded by potted plants, candles and fairy dolls lit by shafts of light from a nearby security outpost, Inbar listened closely.

“I could hear everyone talking around me, making calls,” Inbar said when we met recently in Nitzan, southern Israel. When she got up to find out what was happening, her parents told her to make up a second mattress. As dawn broke, they led into the room a young woman carrying a small bag and wearing a black shirt and jeans. “She had shoulder-length dark hair dyed with red henna and beautiful eyes – big, black with thick eyelashes,” Inbar told me, smiling. “[She was] quiet. She looked scared.”

The woman was Rina (her surname cannot be given for security reasons), a talented artist in her early twenties studying at a local art college, where she had fallen in love with a Christian boy. For Rina, coming from a traditional family, marrying a non-Muslim would be strictly forbidden.

When her parents found out, they were furious and forbade her from seeing her boyfriend. But her male cousins felt this wasn’t enough. Earlier on the day the girls first met, Rina’s cousins had attempted to kill her in retribution for her perceived “honour crime”. Seeing that another attempt on her life was likely, Rina’s father called a relative, who in turn called Inbar’s father, Yossef, a friend of many years. There was no doubt she had to leave. Ironically, a Jewish settlement protected by the Israel Defence Forces was the safest place in Gaza for her to be.

In 1967, Israel seized the Gaza Strip from Egypt during the Six Day War. In time, it settled 21 communities on a third of the land, with a population of 8,000 by 2005. Soldiers guarded the settlements from 1.5 million displaced Palestinians, tens of thousands of whom were displaced in 1967 and moved to live in nearby refugee camps. In Gaza, before Israel’s ultimate withdrawal from the Strip in 2005, relationships between Israeli settlers and Palestinians were fraught. True, many Palestinians worked in Israeli settlements, earning wages higher than elsewhere in the Strip, but the two communities lived largely separate lives.

In the mid-1990s, even after the Oslo Accords, violence was simmering. Israeli military incursions increased with the outbreak of the Second Intifada in 2000. Thousands of home-made Qassam rockets were launched by Palestinian militants at settlers and those living in southern Israel. Security measures hardened. The veteran Israeli journalist Amira Hass, who spent several years living in Gaza, describes neighbourhoods that were “turned into jails behind barbed-wire fences, closed gates, IDF surveillance, tanks and entry-permit red tape”.

And yet, in spite of the forced segregation, Inbar’s family enjoyed close links with their Palestinian neighbours. Inbar’s father worked as an ambulance driver, and on several occasions he helped transport those who lived nearby for emergency medical treatment in Israel. “Every Tuesday, my father’s Jewish and Arab friends would come to our house and we’d eat lunch together,” Inbar remembered.

Given the gravity of Rina’s situation, she couldn’t leave the house. Secrecy was paramount. The girls spent weeks together indoors, Inbar said, chatting, watching TV and drawing. “I’m not sure that as a child I actually understood it for real,” she said. “She taught me how to paint and sketch a face from sight.”

Almost as soon as Rina arrived, Inbar’s family began receiving anonymous phone calls asking about her. “My dad told me, ‘Don’t mention anything about Rina. Say you don’t know what they’re talking about – because otherwise they’ll come and kill us,’” Inbar said.

While the girls got to know each other, Inbar’s mother, Brigitte, found a women’s shelter in East Jerusalem for Rina. Whereas today Gaza is closed off by a military border under heavy surveillance, at that time it was porous. Brigitte drove Rina in to the capital, where she was given a new name and identity that would enable her to begin a new life, on condition that she contact no one in Gaza.

Today Inbar, who is 33, works at the Gush Katif centre in Nitzan – a museum dedicated to the memory of the Israeli settlements in Gaza. Despite her parents’ objections, the family was evacuated in 2005. Unlike most settlers in Gaza, some residents of Alei Sinai were determined to stay on, even if that meant forfeiting their Israeli citizenship. “I have no problem with living as a minority in a Palestinian state,” one of Alei Sinai’s inhabitants, Avi Farhan, told the Israeli daily Haaretz at the time.

Inbar now lives in Ashkelon, a city of 140,000 in southern Israel, and finds the big city alienating, especially when she recalls the warm relationships that once existed in Gaza. “I’ve never felt less secure,” she told me.

Years later, she learned that Rina had developed cancer and died. “The day before Rina left . . . she drew a portrait of me,” she said, describing how her friend had outlined, in charcoal strokes, the features of the teenager. Her parents packed the portrait with all their belongings in a shipping container the day they left Gaza. Soon after, the container was destroyed in a fire.

“I think if people had given it a chance . . . they would have had these kinds of friendships,” Inbar said, looking back. “We’d get along fairly well if we didn’t look at others as the monsters over the wall.” 

This article first appeared in the 27 August 2015 issue of the New Statesman, Isis and the new barbarism