Germany's International Cooperation Needs a Reset

The incoming coalition government will have to reorganize development cooperation policy. The reason for this is less the budget cuts to the Federal Ministry for Economic Cooperation and Development than the increasingly fierce global competition with the countries of the Global South and the BRICS bloc, above all China. The challenge will be to transform the achievements of current development cooperation into strategy-oriented and interest-based international cooperation.

In multiple development policy discussions in recent months, commentators have been concerned with the construction of cycle paths in Peru, agitation against all forms of development cooperation by the rightwing Alternative for Germany Party (AfD) and cuts to the budget of Federal Ministry for Economic Cooperation and Development (BMZ). These are all topics about which one can get worked up, but the agitation only distracts from the core issues of international cooperation (IC). That is the focus of new policy briefs that need to be seriously examined. Both the Federal Foreign Office, led by the Greens, and the Social Democrats (SPD) have formulated new Africa strategies (“Doing justice to Africa's greater significance in the new era (after the Russian attack on Ukraine – ed.”). The parliamentary group of the market-liberal Free Democrats (FDP) proposes integrating development cooperation (DC) into the Federal Foreign Office. According to them, development aid should be understood as an instrument of foreign policy and the effectiveness of development cooperation should be increased.

The Federal Ministry of Food and Agriculture (BMEL) under Cem Özdemir, also from the Green Party, has positioned itself with its “BMEL Framework for Cooperation with African Countries and Regions”, just as BMZ-Minister Svenja Schulze (SPD) had previously done. She has now gone a step further with her even more fundamental paper “Development Aid was Yesterday” – a trenchant text taking aim at all those who, until recently, had emphatically suggested that development cooperation was on the right track in any case. The minister has changed course; she even wants to change the name of the ministry to the Federal Ministry for International Cooperation. Schulze's contribution deals with policy and strategy of international cooperation, including cooperation with Ukraine, the Middle East, the Sahel and the Horn of Africa, and formulates a geostrategic agenda in the light of global changes.

Originally, development policy was thought to encompass measures that serve the development, economic, technical and social support and future advancement of developing countries, such as poverty reduction. However, these DC-ideas have become outdated over the years; a consequence of the surge in prosperity in a majority of countries with declining relative poverty. Many low-income countries have become middle-income countries. In addition, the geo-economy has been changing for some time with the emerging countries of the BRICS bloc and the Global South, which are increasingly pursuing their own agendas, some directed against the West. The guiding principle of the countries of the Global South, despite all the differences between them, is: “We want South-South cooperation. We no longer want your interference.” These countries need less and less traditional development aid; most of them no longer even need highly qualified experts because there are enough experts available in their own countries.

How should the German policy of cooperation be shaped in future in view of these major changes?

I propose eight central measures to realign international cooperation:

1) The 2030 Agenda and the Sustainable Development Goals (SDGs) are a set of goals for all countries with regard to climate, justice and peace. International cooperation must be guided by the norms agreed by the international community without abandoning legitimate self-interest.

2) German IC at its core should be a soft power concept that is characterized by persuasiveness and attractiveness. This implies a change in German expertise required. There is less and less need for traditional assistance and expertise, but rather for skills in building joint ventures in business, research and culture. Soft power has been shown to be an advantage when it comes to influencing international policy decisions. In its 65-year history, German DC has formed a unique international network. The potential of this network needs to be put to better use, because Germany is no longer seen as a natural partner for cooperation in the Global South. Deepening soft power cooperation means tapping the reservoir of trust that development cooperation organizations, political foundations, the DAAD (German Academic Exchange Service), universities and educational institutions, Goethe Institutes (German Language Institutes) and privately organized networks such as city partnerships have built up by exchanging ideas and jointly seeking solutions (such as against climate change or child labour).

3) Strategy-based and modern IC should be business-oriented by design. At present, this is too rarely the case. In order to develop a geo-economic alternative, especially to China's universally deplored practice, cooperation between the network organizations and German business should position itself strategically. Highly developed German industry should focus primarily on technology cooperation and collaboration in research and development (R&D). At the same time, it should deepen links between German and local companies in value chains. IC can contribute to this and thus facilitate knowledge transfer and knowledge selection for mutual benefit. Traditional development cooperation mostly focused on small-scale projects, vocational training or the promotion of local small and medium-sized enterprises. New IC takes a broader approach by emphasizing network power while at the same time focussing on shared interests in economic cooperation. This also includes a concept of “growth with jobs”, a goal that until now has not been set much of the time.

For decades, German development cooperation moved in the wake of the World Bank and the IMF, which organized detailed economic cooperation strategies but largely omitted the goal of increasing employment. As a result, many countries in the global South generated economic growth – but without sufficient jobs (jobless growth). The “Marshall Plan with Africa” and “Compact with Africa” pursued by successive federal governments also shared this weakness. The focus was on improving the economic environment, liberalizing markets, increasing investment and opening up trade. But industrial development, employment and protection against unfair trade practices were neglected. As Theo Rauch wrote, development cooperation has failed to promote productive employment and income opportunities.

4) “Do-no-harm strategies” are an essential component of a responsible policy and remain important in the face of rising global poverty, climate catastrophes, food and migration crises. But German IC should do more than that. It should develop value creation activities with partner countries through joint ventures between companies and the use of soft power. This means turning away from the economic agenda of multinational corporations that exploit raw materials worldwide, damage agriculture on a large scale, take advantage of low wages in poor countries, but generate hardly any local value creation and thus thwart national development – without knowledge transfer, without technical upgrading and appropriate value creation for local entrepreneurship. This also means that a German and European counter-model is needed that goes hand in hand with higher local value creation in agriculture, the service sector and industry. This strategy benefits German companies in the long term and also contributes to the prosperity of our country. Such a value creation agenda could also be a strategic response to China's practices. While we should not expect to be able to change course on a large and comprehensive scale, such an embedding model would set an example.

Reality Check and a Reset

IC policy needs a reset. The long overdue fundamental debate on German foreign and development policy should not consist of a “business as usual” agenda with cosmetic adjustments, nor should it formulate unfulfillable “pie in the sky” visions. There have been enough of these in recent decades, for example that global poverty can be reduced through cooperation or that DC is a driver of democratic development. We should also finally recognize that Germany has lost economic power due to a lack of growth and innovation – and therefore has also lost the soft power to shape the future. The “German model” is losing its appeal. And what is even more important: Governments around the world are no longer just demanding a say in political discourse, they want to set the agenda themselves and decide on their own development.

Nevertheless, the spirit of formulating unrealistic expectations still prevails in German development policy, which can only lead to failure and renewed frustration. We have repeatedly fallen into this trap. It would be better to subject IC to a reality check and thereby better understand what it can and cannot achieve. A fundamental shift is required, old habits need to be thrown overboard. Above all, official development cooperation needs to move away from the traditional project-based policy, which still devours most funds, and make funds available for new tasks. In any case, continued cuts to the BMZ budget will require a consolidation of DC activities.

Critics have wanted to abolish development cooperation for many decades. In the 1970s, it was criticized as neo-colonial. In the 1980s, Brigitte Erler branded it “fatal aid” – saying that it benefited only the rich and marginalized the poor. In the 1990s, DC was criticized for inhibiting development and entrenching existing structures. Structural adjustment programs and good governance requirements, it was said, had socially detrimental effects and were based on Western standards. In addition, criticism intensified over time of the development industry's vested interests and its conservative reluctance to change. In order to avoid falling back into these patterns, sights must be set on IC based on partnership.

The field has recently shown itself to be quite open to discussion. This is a good sign and should provide a boost in the coming months to reorientation and the formulation of a comprehensive policy of International Cooperation. The quicker we acknowledge that the world keeps on turning and that we have to adapt accordingly, the better.