Conditions for development loans must be made public

BDF won’t accommodate people’s voices or representatives: VOICE

Rights group VOICE, complaining that people’s voices will not be heard nor their representatives accommodated in the upcoming dialogue between the government and global lenders, has demanded that that conditions imposed for, and the expenditure pattern of, foreign aid-funded development projects must be made public.

Referring to the meeting of the Bangladesh Development Forum scheduled to be held in Dhaka on February 15-16, VOICE has called for a debate on the relevance of external loans, which should involve politicians, professional groups, businesspeople, civil society dignitaries, and representatives of local government and community organisations.

Prime Minister Sheikh Hasina is expected to inaugurate the BDF meeting which will be attended by representatives of the Local Consultative Group, a forum of lending agencies and donor countries, and those of the newly emerging economic superpowers.
‘People from all strata of life do not have any access to the Forum although it demands greater participation of stakeholders,’ Ahmed Swapan Mahmud, executive director of VOICE, noted in a position paper titled ‘Destructive Aid and Bangladesh Development forum 2010’.

He observed that the lending institutions, which are euphemistically called donors, have always imposed tough conditions before giving loans — a practice which has been crippling the political decision-making process of the government right after the nation’s birth.

The rights-based research organisation cited the example of the second version of the lender-driven Poverty Reduction Strategy Paper, the development document which will be discussed for endorsement at the BDF, in the formulation of which the people’s voices and needs were totally ignored.

VOICE insisted that the government should announce the time when the country will no longer take external loans for financing national development programmes‘The government should also make all aid conditionalities and project agreements with lenders public to ensure transparency, accountability and good governance,’ said Swapan.
At the same time, he added, the lenders should also be transparent in the funding of the projects, detailing allocations and potential beneficiaries. ‘They should also comply with basic principles of ownership, harmonization, alignment, and mutual accountability,’ he said.
VOICE expressed the widely held view that foreign aid could not alone solve the problems of Bangladesh, pointing out that the flow of assistance has declined over the years.
In the 1980s foreign aid was around 10 per cent of the country’s Gross Domestic Product but now it has come down to 2.3 per cent only.

‘About 75 per cent of the assistance that Bangladesh received went back to the lenders and donors in various forms,’ pointed out Swapon, who quoted research findings.

http://www.newagebd.com/2010/feb/13/nat.html