Browsing articles in "Foreign Aid"
Feb 28, 2013
Center for Democracy and Civil Society

Malawi’s Banda Continues Her High Stakes Game

Civil servants go on strike / (BBC News)

Civil servants go on strike / (BBC News)

Last summer, I posted a short piece about Malawi’s Joyce Banda. Southern Africa’s first female president had only been in office for three months back then, but her actions were already making headlines. Banda announced plans to sell the presidential jet, a luxury item acquired by her predecessor and an ongoing source of domestic contention and international condemnation. She confronted Sudanese President Omar al-Bashir over his ICC indictment, refusing to host the planned African Union Summit with Mr. Bashir in attendance. But what finally caught the attention of the international community was a policy shift that, while eminently technocratic, served as a harbinger of the sort of reform that donors love to see. Banda devalued the Malawian Kwacha by 49 percent, and right on cue, the Millenium Challenge Corporation and the International Monetary Fund responded with new aid packages worth hundreds of millions of dollars.

The circumstances surrounding Banda’s rise to power add intrigue to the story. A surprise choice as President Mutharika’s running-mate in 2009, she was booted out of the ruling party for showing flashes of political independence — particularly her refusal to endorse Mutharika’s brother as his presidential successor. But as an elected official, Banda was legally protected from arbitrary dismissal, and she displayed a rugged resilience by shrugging off demands for her resignation as vice president in the face of intense criticism at public rallies and on state-owned media. This obstinate stance ultimately put her in the State House when Mutharika died in office last year.

Banda quickly emerged as interesting case study: What happens when a relative political outsider suddenly rises to the top of the government, confronts an important actor in the region (the African Union), initiates a painful series of austerity measures to rebuild international aid relationships, but does it all without a strong domestic constituency or the support of the ruling party?

After nearly a year, we’re starting to see some answers. As expected, the currency devaluation drove inflation through the roof, simultaneously increasing the cost of living and decreasing the real value of worker salaries. State employees responded this month with a nationwide strike, the biggest in Banda’s short tenure. A majority of Malawi’s 120,000 civil servants refused to resume work until the Banda administration boosted wages by 65 percent. Schools and airports shut down. Nurses and doctors threatened to join the strike. Banda struck a deal, announcing a 61 percent wage increase for the lowest-paid civil servants. But top officials in her administration were quick to note the unsustainable strain that higher wages would place on Malawi’s budget. “If we go down that route then we should forget recovering from the difficulties that we are trying to recover from now,” the minister of finance recently said. “[We would be] returning not only to the way we were before the reform, but a worse situation where the economy would simply collapse.”

But it’s important to remember that a collapse of this sort would be a manufactured one; the predictable result of divorcing domestic politics from economic policymaking driven by donors. The problem goes something like this. In order to attract international aid and investment, the government acquiesced to demands for austerity. As new aid flowed in to supplement the national budget, the domestic sources of government revenue shrank as inflation hurt the economy and put downward pressure on spending and real wages. So the share of Malawi’s budget provided by international aid rose as well, today standing at approximately 40 percent. This gives donors tremendous leverage and alters the incentives of Malawian leaders. But Malawi’s citizens are not happy, and they begin to protest and demand more government spending to alleviate tough economic conditions. Government officials find themselves in an untenable position. If they agree to increase wages, it may indeed overtax Malawi’s still modest budget and threaten the international aid they so desire, since much of it is conditioned upon financially sound policies — as determined by the donors. If they refuse domestic demands for action, they risk punishment at the ballot box. And Malawi’s next election is only a year away.

It appears to be a lose-lose situation for Banda. But rather than grab one of those third rail options with both hands, she has plotted a middle route between them with her recent deal with the state workers. The IMF, for its part, released an amazingly cynical statement warning of “growing public outcry” over the very conditions that its policies helped produce. What does it recommend? A doubling down on austerity, of course, with tighter expenditure controls and monetary policies until inflationary pressures recede. There was no mention of policies or resources to redress the very real economic costs on a human level. In fact, the IMF seems rather pleased with Malawi’s current trajectory, saying that “there are encouraging signs that economic recovery is underway.”

This is the danger when a government finds itself more accountable to international donors than to its own citizens. Banda may well survive this recent storm, but there are a number of domestic groups (including opposition parties) that surely will not forget moments where government policy was driven by external forces and produced considerable internal pain. Perhaps we will have to wait until the 2014 election to offer a more complete assessment of the Banda experiment. But for a leader without a natural political constituency, estranged from much of the political elite, and whose popularity is dwindling among those affected by her austere approach, Banda’s political future does not look promising. Donor darling or not, all politics is local.

Other
Feb 19, 2013
Center for Democracy and Civil Society

Somalia Event at Georgetown – February 20 at 10 a.m.

A brief announcement for those who might be interested in the Horn of Africa. There will be an event about state-building in Somalia on Wednesday morning at 10 a.m. in the Intercultural Center on Georgetown’s campus (7th floor, Executive Conference Room). We’ve got some great panelists from the State Department, the National Endowment of Democracy, Relief International, and an organization called Somali Family Services. It should be a valuable chance to learn about recent developments and interact with practitioners that have worked on Somali issues for many years. More information is below. I hope to see you there!

State-building in Somalia 

New Government, Old Challenges 

Featuring

Abdurashid Ali, Somali Family Services

Rob Satrom, Department of State

Eric Robinson, National Endowment for Democracy

Steven Hansch, Relief International

Wednesday, February 20, 2013, 10:00 – 11:30 AM

Executive Conference Room, 7th Floor, Intercultural Center (ICC), Georgetown University

In August 2012, Somali leaders from around the country implemented a series of steps to replace the Transitional Federal Government, which had exercised nominal control over the country since 2004. A National Constituent Assembly adopted a new constitution, and members of Somalia’s new federal parliament elected an academic and civil society activist, Hassan Sheikh Mohammad, as president. Meanwhile, political progress in Mogadishu has been accompanied by security gains against al-Shabaab, which has been pushed out of its largest remaining urban stronghold in Kismayo by AMISOM forces.

Despite these developments, many core issues remain unresolved. How will the federal government consolidate its authority beyond Mogadishu? To what extent will regions like Puntland and Somaliland, with their own political transitions, choose to participate in the new system? What are the implications for development efforts across the country, and how can the international community assist in state-building? Please join us for a discussion of these issues, and more.

Jan 25, 2013
Center for Democracy and Civil Society

Hot Spot: North Africa

In an interview with USIP, our director Daniel Brumberg “considers the potential for al-Qaida’s growth in  North Africa, and the challenge this poses to U.S. relationships with  the new, post-conflict governments in the region”. Check it out below:

20130125-North-Africa-UTexas

 

How do you assess the regional implications of the January 16 seizure by radical Islamists of a gas field along the border area of  Algeria and Libya—as well as the resulting (and horrific) casualties?  And what are the implications for the “Arab Spring” uprisings, which are now in their third season?

Well, let’s take those one at a time. Mokhtar Belmokhtar — the  Jihadist whose forces led the attack on the Algerian gas facility — declared that his actions were meant as a rebuke to France for its  military intervention in Mali. But Belmokhtar’s assault was surely  planned well before Mali’s acting government invited France to  intervene. So, this much is clear: in a strategic sense, the attack on  the Algerian gas facility represents an effort by a regional off-shoot  of al-Qaida to use the northern Mali conflict as a lever to amplify  al-Qaida’s violent message throughout the Maghreb.

Would the makeup of the group that led the assault in Algeria illustrate your point?

Yes, for sure. The attackers hailed from the wider region: only three were Algerian, and the rest came from Mali, Tunisia, Egypt, Libya,  Niger, and Mauritania—as well as other countries. Their goal is to  exploit the political upheavals to expand and solidify their bases of  operations, and in so doing, put the U.S. and its Western allies on  notice that regardless of the particular governments that have emerged  via the Arab Spring uprisings, the future lies with al-Qaida and its  allies. It is very likely that these groups want to derail the  transition tracks of democracy, while at the same time signaling that  they are ready to revive attacks against the government of Algeria – an  autocratic regime that has thus far survived the tremors of political  change in the region.

Some experts have argued that the French decision to  intervene in Mali needlessly internationalized a conflict. What are your thoughts?

I am not sure I would put it like that. The rise and expanding threat of Jihadist forces in Mali created a dilemma for Western states and  those African states that felt threatened by this development. If you  failed to act, Mali could become a permanent base for an  African/Maghrebi al-Qaida branch. But at the same time, intervention  carried the risk that Jihadists would leverage the situation to their  advantage by decrying it as an example of Western imperialism. The  French decided that the potential cost of waiting outweighed the risks  of moving now.

You have asserted that one probable goal of the Algeria  attack was to interfere with—even derail—the Arab Spring, or democratic  transition efforts. This seems interesting, especially since, in the  case of Egypt and Tunisia, elections have put Islamists into power,  and/or magnified conflicts between Islamists and secularists, a trend  that radical Islamist forces would welcome.

Well, first keep in mind that from the vantage point of al-Qaida  affiliates, both in terms of ideology and strategic orientation, the  Islamist leaders whose political fortunes have benefited from democratic change are hardly “authentic” representatives of their vision of Islam. The relatively moderate form of Islamism advocated by the Nahda Party  in Tunisia, and even the sterner Islamist vision propounded by the  Muslim Brotherhood in Egypt, represents –in the eyes of al-Qaida’s  allies– a much watered down Islamist agenda.

Moreover, the continued strategic cooperation between Washington,  Tunis and even Cairo –despite all the ups and down of the last few  months—represents a strategic challenge for al-Qaida, since from its  perspective, these governments remain close allies of Washington.

Are you suggesting that al-Qaida plans to take on or even attack these governments?

No, not in a direct or immediate sense. Whatever the ideological and  strategic differences with the Islamist leaders who have come to the  political fore in Egypt, Tunisia and Libya, al-Qaida affiliates have no  incentive to directly challenge or attack these new governments, or even more so, their security forces. But, they are probably trying to  establish local cells or affiliates where they can, and these cells  could certainly be seen, from the perspective of these new Arab  governments – or certainly their security forces—as a threat.

Moreover, and perhaps more importantly, al-Qaida affiliates are keen  to exploit the capacity of these new and governments to secure control  over their vast territories, be it in Egypt’s Sinai, in the southern  areas of Algeria, or the border regions of Libya, Tunisia, Libya, and  Algeria. Such efforts not only raise the troubling prospect of  geographic fragmentation and state weakening, they can deeply embarrass  democratically elected governments, whose Islamist leaders control  movements, many of whose young adherents find the radical Islamism of  al-Qaida in North Africa and that of Mokhtar Belmokhtar deeply alluring.

How have the governments of Tunisia and Egypt reacted? Is this strategy working?

I wouldn’t say that the above strategy is working, but the new  governments in Tunisia, Libya and Egypt are surely worried. They are  seeking to secure their legitimacy in the midst of ongoing political  battles between secular and Islamist forces, struggles that have  intensified as a result of the growing influence of radical Salafist  groups, some of which openly advocate violence. The challenge facing the region’s new governments, especially those that contain and/or are  dominated by mainstream Islamist parties, is to distance themselves from the extremists, while maintaining their Islamic or populist  credentials. That is something of a balancing act.

For example, Tunisia’s leaders –and interim President Moncef Marzouki in particular –have praised Algeria’s rescue effort. Particularly after the violent attack on the U.S. embassy in October 2012,  the Tunisians  are keen to demonstrate that they are clamping down on radical  Islamists. Moreover the country’s Interior Minister announced on  December 21 that the security forces had just discovered and dismantled  an al-Qaida outside Tunis. But Nahda, which is the leading political  party in the increasingly fragile ruling coalition, would also like to  integrate non-violent Islamists into the political process, and thus  wants to avoid being seen as simply carrying out the wishes of  Washington. This not easy to do when the party finds itself compelled to rely on the very security forces that were once aligned with the  previous regime to maintain order.

I assume that Egypt’s leaders are also walking a similarly fine line?

Even more so. Morsi has proclaimed his support for the Algerian  government and its assault on the gas compound, but he has also  denounced France’s military intervention in Mali. The very idea of  Western military intervention in a Muslim or Arab country is something  that Morsi and many of his allies in the Muslim Brethren reject on  principle. At the same time however, they are striving to rebuild  relations with Washington and to reassure the U.S. that Egypt is not  rocking the strategic boat.

Your response raises the tricky question of Libya and its role in the wider region.

Indeed. I suppose you can make an argument that full and complete  control of one’s national territory is not absolutely required in order  to advance a democratic transition. But in the long run, the survival of militias in Libya constitutes a threat to any chances for serious  democratic progress. After the September 11, 2012 attack on the U.S.  compound in Benghazi — and the tragic killing of our ambassador and  other Americans — there was some hope that the government could reign  in the militias, but this has not happened. Indeed, the continuing  activity of radical Islamist groups in Western Libya, aided by access  the arms seized after the fall of Qaddafi, has been a huge regional boon to al-Qaida affiliates.  This represents, as one of my colleagues put  it, the “dark side” of the Arab Spring.

Finally, what of Algeria, a country about which we have heard very little since the Arab Uprisings began in early 2009?

We have to remember that Algeria experienced a long and bloody  internal conflict following the military’s intervention which in late  1991 put an end to process of democratic elections that would have put  the country “Islamic Salvation Front” into power. In the ensuing eight  years, some 200,000 Algerian died. But by 2000, through a mix of  repression and cooptation, the regime succeeded in restoring some degree of political stability. Thus when the Arab Spring erupted in 2009, the  political class –such as it is—and the wider population evinced little  interest in emulating its Tunisian neighbors, since the prospect of  democratic reform also seemed to raised the prospect of internal  political strife and even violence.  The key to this strategy, of  course, was not only to keep a lid on radical Islamists, but also to  make sure that they did not pose a threat to domestic oil production,  which is, quite literally, the life line of the regime.

So it seems that the attacks on the gas installation represented a powerful threat to this strategy, no?

Precisely. Algeria’s leaders have been waging a low intensity  conflict with al-Qaida’s affiliates in North Africa, managing to keep  them at bay. But the attack on the gas installation represents an  assault Algiers’ strategy both regionally and domestically.  It not only raises the prospect of instability in its oil producing region, it also raises the prospect that Algerian territory will once again become an  organizing ground for radical Islamist assaults throughout the region.  This concern helps to account for the determination of the Algeria  military to draw a literal and figurative line in the sand by assaulting Belmokhtar’s forces at the gas installation and refusing any negotiated outcome. Algeria’s leaders look at the Arab Spring and see a recipe for regional disorder and violence. Events in Mali, Algeria and Libya will  only reinforce their determination to hold on to power, and to resist  what they see as a black hole of political upheaval in the region.

Jan 18, 2013
PEstrada

Freedom in the World

On Wednesday Freedom House published Freedom in the World: 2013, a report built on an index trying to measure the level of political rights and civil liberties in all the countries of the world and in some territories in dispute (http://www.freedomhouse.org/article/freedom-world-2013-middle-east-gains-provoke-intensified-repression). Here are some highlights:

Numbers: 90 countries ranked as free (three more than the previous year). 27 nations had significant declines, next to 16 with gains. It is the seventh consecutive year in which there are more declines than gains.

Arab Spring countries have experienced diverging paths. On the positive extreme we have Tunisia; on the other side, Syria. Egypt seems to be the case in the middle. The evidence for advancements in liberties is in the energy of civil society and the installation of a civil rule. On the contrary, worrisome issues include the cumbersome process of writing the Constitution, the lack of balance to the President’s power, or attacks to NGOs. Furthermore, it is yet unclear whether the Muslim Brotherhood is committed to democracy or not.

This adds up to another observation: authoritarian leaders are finding even more ways to curtail the liberties of citizens, as is the case of Russia and Turkey. Putin and Erdoğan have taken different course of action to secure or increase their power in face of other political actors (opposition parties, the legislature) or the society (by rigging elections, reducing freedom of speech, or frustrating the activities of NGOs).

Regarding North America and Western Europe, although no major changes with respect to previous years are reported, it is noted that nationalist sentiments (and against immigrants) have arisen in some countries due to constraints related to the economic crisis that began in 2008.

Under this scenario, it might seem fair to re-ask the question posed by Barbara Geddes almost two decades ago: what do we know about democratization forty years later? An initial caveat is to refrain from unconditional enthusiasm when facing citizen protests, whose outcome is still largely uncertain. Given that this is the seventh year in a row in which declines in liberties surpass the gains, could this be an indicator of the world experiencing a “reverse wave of democratization”, borrowing from Samuel Huntington? The subtitle for the Freedom House communiqué is “Calls for US leadership as democracy declines for seventh year”. Before that, it seems about time to think with even more attention about why democracy assistance actions and domestic political processes have and have not led to that goal.

Jan 13, 2013
PEstrada

Three Years Later

The Haitian Presidential Palace in January 2010, the day of the earthquake (from The New York Times).

The Haitian Presidential Palace in January 2010, the day of the earthquake (from The New York Times).

The image of the collapsed Presidential Palace was seen as the most adequate symbol of the situation in Haiti after the earthquake of 2010: what was left were only ruins. In the days following the disaster, the press constantly updated the figures of the deaths, the homeless, the wounded, and of any other classification for the victims. Unfortunately, if anyone thought that the situation in Haiti could not get worse, he or she was proven wrong.

The disaster offered a creepy opportunity to start anew, practically from a tabula rasa (as a symbol of this re-start, in September 2012 the Presidential Palace was finally demolished, expecting to build a new permanent house for the executive branch of government in the coming years). On the one hand, Haitians did not give themselves to despair. Moving stone by stone, they have cleaned up the roads and streets of the country, rebuilt houses, and reestablished services. In addition, the government has implemented new regulations and programs that aim at helping the poorest sectors of the population to rent a house (the construction code was substantially modified), to ameliorate the nourishment of children, and to fight tropical diseases such as cholera. In the midst of the crisis, the country went through a presidential election that, although highly contested during the campaigns, was carried out peacefully and within the existing institutional channels. The assistance of foreign governments and multilateral organizations is at all times acknowledged.

On the other hand, as suggested in the communiqué of the United Nations Mission for the Stabilization of Haiti (MINUSTAH), efforts have to be increased. There are still at least 300,000 people living in refugee camps, the passing of hurricanes still poses a major threat (as was the case last November during Sandy), and the government is still working to develop full authority and capacities (the Mission’s 2012 report can be found here: http://minustah.org/pdfs/fact_sheet/factsheet2012-haiti-moving-forward.pdf). Otherwise said, the mammoth institutional challenges of Haiti are still clearly present, building an efficient and democratic state that in its previous versions had been rampaged by dictators and that had been unable to process the society’s conflicts. If this was an easy task, it would have been done by now.

 

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Founded in 2004, Democracy and Society is a biannual print journal published by the Center for Democracy and Civil Society at Georgetown University. The D&S Blog provides web-only content, including special reports and investigative series, on issues relating to democracy and development.

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