A New Transatlantic Agenda for Development

Louis Michel
EU Development & Humanitarian Aid Commissioner

at the

European Institute
Washington, DC
January 28, 2005

Distinguished Guests,
Ladies and Gentlemen,
Colleagues,
Friends,

Let me first of all thank the European Institute for this invitation. I am delighted to have this opportunity to share my views with you.

This comes at a very special time of change on both sides of the Atlantic. Since November, we have a new European Commission, and a few days ago, President Bush took up office for a second term with a new Administration.

A fresh start gives us a chance to open a new chapter in transatlantic relations. We can overcome the frictions that have marred our relations over the last couple of years.

I therefore very much welcome the news that President Bush has decided to make Brussels his first port of call after his inauguration.

As President Barroso has said, “The relationship between the United States and Europe constitutes the world’s strongest, most comprehensive and strategically most important partnership.”

On a global level we are both major actors, and as such we have global responsibilities.

To exercise that power and responsibility effectively, we must work together. A lot has been said and written on the issues which divide us. But that is a well-trodden path, and I prefer to take a new road.

We are maybe brothers, certainly cousins, but not twins and that is perfectly normal.

In the words of President Kennedy, “Let both sides explore what problems unite us instead of belaboring those problems which divide us.” And I believe that the poverty gap between the developed and the developing world is perhaps the key common challenge on which we can and must work together if we are to make a real difference to today’s world.

The EU and the US must be partners in facing the challenges.

Facing them together trough the United Nations would create a leverage of unprecedented strength and scope. The UN is the only multilateral organisation with a moral and political authority. Even if I am willing to recognize that a reform of this institution would be necessary for it to become a fully recognized legitimacy-provider.

Last week I participated to the European launch of Professor Sach’s report “Investing in Development: A Practical Plan to Achieve the Millennium Development Goals.” The bald figures speak for themselves.

Poverty: More than a billion people in the world live on less than one dollar a day.

Health: eleven million children – most under the age of five – die each year; over six million of these deaths are due to preventable diseases such as malaria, diarrhea and pneumonia; and more than one billion people do not have access to safe water.

Education: more than 100 million children do not attend primary school and nearly 600 million women are illiterate.

In 2000, the world’s leaders agreed to the Millennium Development Goals to reduce poverty, fight disease and hunger, get girls in school and give more people access to safe water.

Sub-Saharan Africa is the region furthest from meeting these Goals. And unless the international community acts now and acts big, Africa will not meet this challenge.

For sub-Saharan Africa as for other regions, the world already has the tools needed to win this fight. And many of them are entirely affordable: bed-nets to fight malaria; vaccinations to fight infectious disease; antiretroviral therapies to fight AIDS; fertilizers and agro-forestry to raise crop yields; bore wells for safe drinking water; diesel generators for village electricity.

No international leader can hide today behind the excuse of ignorance. The size of the challenge is immense. But this is no time to despair; this is the time for us to act.

Today we have not only a great challenge in front of us. We have a great opportunity to meet that challenge. Let us see 2005 as the “Year of Development.” In July, the G8 will meet in the United Kingdom, and Africa is top of the agenda. In September, in New York, there will be the crucial United Nations High Level Event on the Millennium Development Goals. And in December, the debate will continue in Hong Kong as the international community strives for vital progress on the Doha Development Agenda of international trade talks.

The Sachs Report has shown us how far we are from achieving the Millennium Development Goals. We must now take this as a wake-up call to the whole international community.

The European Union and the United States are key actors in this process. In 2003, the European Union together provided 55% of the total Official Development Assistance, and the United States is the largest single bilateral donor in the world with nearly 25%. That means that, together, the EU and the US provide almost 80% of the total development assistance globally. If we act together, we can really make a difference.

Both in Europe and in America, there are always vocal critics of development aid. The argument is often: what do we stand to gain from this? Why should we help those in countries many people have never heard of, far less visited? We need first of all to work together to combat this ignorance.

We need to show that in today’s world we face global problems, which require global solutions.

Let me highlight three themes, intimately linked to development, which show that problems abroad affect people at home. First, security and development; second, trade and development; and third, health and development.

First, security and development. The intimate link between security and development was brought home by the tragic and terrible events of 9/11, which affected not only America, but the whole world. There is an ongoing debate on both sides of the Atlantic as to how best to respond to the threat of terrorism: by focusing on reinforcing security measures, or by addressing the underlying causes of instability which is reinforced by poverty and lack of perspectives?

My position on this is clear: security and development go hand in hand. We cannot have development without security, but equally we cannot guarantee our own security without investing in the development of others. Conflict prevention and conflict resolution can bring huge long-term benefits in terms of economic and social development. And through changing these societies for the better, we help reduce the risks that we face in terms of our own security in the future.

Second, trade and development. Trade opening and reducing trade barriers is essential to promote growth and development worldwide, to improve standards of living and to tackle poverty reduction. Provided it happens within a framework of rules that allow for a fair distribution of the benefits of open trade.

As trade is global, so must the rules be. To ensure that trade opening contributes more to development, WTO members launched the current round of international trade negotiations and called it “the Doha Development Agenda.” Our top trade priority on both sides of the Atlantic must be to put our weight behind the Doha round and conclude it in a way that lives up to its ambition.

In the European Commission, under my colleague, Trade Commissioner Peter Mandelson, we have made this our number one priority in trade policy. The EU and the US need to work together to turn lofty rhetoric and high aspiration into a practical and realisable agenda for action, and the Hong Kong WTO Ministerial in December will be a test case for our determination.

Third, health and development. In an era dominated by the pandemic of HIV/AIDS, the argument is plain why we need to make urgent progress on health and development. We fully support the huge American investment to tackle HIV/AIDS through the Emergency Plan for AIDS Relief.

In the European Union, we put the priority on tackling the big three killer diseases in the developing countries: HIV/AIDS, tuberculosis and malaria. The EU and the US as biggest donors, both back the Global Fund which has been set up to address precisely these problems.

In a global world, disease travels as fast as man. We must urgently work with partners across the world to combat disease and to avoid the millions of deaths which occur today in the developing world from diseases for which often simple cures exist in the developed world. For many of these illnesses, we hold the solution in terms of making vaccinations and drugs affordable in the developing world.

Addressing the challenges – not being overwhelmed by them – is the reason why I personally am committed to developing, with our partners, a new vision for EU Development Policy. I had the opportunity to discuss these ideas in a seminar with the World Bank yesterday. We need a frank and honest assessment of what we have done to date: what works and what does not work.

But to make a difference, we need not just new ideas. We need new money. The report by Jeffrey Sachs on achieving the Millennium Development Goals is very clear on that. International leaders reaffirmed their commitment in Monterrey to devoting 0.7% of GDP to official development aid. If we are serious about the Millennium Goals, it is time now to deliver on those goals.

I know that a number of new ideas are circulating for how we can finance these goals. All contributions to the debate are welcome. But we must not let ourselves be distracted from the challenge of meeting the Monterrey commitments. We cannot wait for tomorrow, if we are to succeed in the goals we have set ourselves for 2015, we must deliver on our promises today.

A lot has been said, both in Europe and America, about aid fatigue. But the response of the international community to the tsunami disaster in the Indian Ocean has proved the exact opposite. The overwhelming destruction has left all of us shocked and determined to assist. The American and European peoples have shown tremendous compassion and global responsibility.

We must build on this positive attitude for mobilising the adequate levels of resources for the other "silent tsunamis" in the world, which generate suffering and poverty at even greater scales.

We must now build on this collaboration on a bigger scale. We should look hard at the whole development agenda and identify policies and programmes where the EU and the US can work together. And I come back again to the region of the world furthest from achieving the Millennium Development Goals; I come back to Africa.

The G8 is giving us a lead, in putting Africa on the top of its Agenda in July. I myself am working with my colleagues in the European Union on a new African focus.

• In terms of security and development, we must unite in strengthening Africa’s governance and in helping Africa to help itself. Africa now has structures in place to deal with conflict prevention, management, and resolution. The AU and regional organisations, such as the Economic Community of West African States (ECOWAS), have shown that they are both willing and able to assume responsibility for the African peace and security agenda, for instance in Burundi, Côte d’Ivoire, Liberia or Sudan.

We must support those countries, which take courageous steps toward ensuring peace, as the precursor for development. Let’s take the case of Liberia. Sending ECOWAS peacekeeping-forces was decisive in restoring peace and security in Liberia. There is now a platform for building economic growth and prosperity – the EU and the US should work together in bringing it about.

In particular, I would highlight the need to support the fledgling structure of the African Union and the New Economic Partnerhsip for African Development. Henry Kissinger once said, "What number do I call, if I want to call Europe"? In Europe, we have made great strides to answering that question. Together, we should help Africa speak with one voice.

• In terms of trade and development, again Africa is lagging behind. For the past thirty years, sub-Saharan Africa's share of world trade has actually been in decline.

For every dollar received in aid, half has been lost as a result of deteriorating terms of trade. If sub Saharan Africa could regain just an additional one per cent share of global trade, it would earn $70 billion more in exports – nearly five times what the region receives in foreign aid and debt relief.

I already referred to the crucial role of the WTO, but the EU is also committed to doing more bilaterally to build capacities in these countries that allow them to actually benefit from the trading opportunities created. We already provide duty-free and quota-free access to our markets for least-developed countries.

Through the Economic Partnership agreements that we negotiate with our partner countries in Africa, the Caribbean and the Pacific, we are determined to support regional integration that helps overcome the problems of too small markets and the capacity constraints hampering integration into the world economy. I am working closely with Peter Mandelson to provide trade-related assistance that turns opportunities into realities. The US Africa Growth and Opportunity Act is also trying to address the problems of marginalisation. But I am sure that together, we can do even better in helping Africa overcome its marginalisation.

• And in terms of health and development, Africa is certainly the place hardest hit by disease and avoidable deaths. In particular, we must reinforce our efforts to combat HIV/AIDS, tuberculosis and malaria through enhancing access to prevention, vaccines and to curative medicines.

There is a new generation of leaders emerging in Africa, committed to democratic and economic reforms. The African Union is now starting to shape a vision of development for Africa as a whole. This is underpinned by a series of regional organisations, such as SADC [Southern African Development Community]. A system of peer review is in place. In short, Africa is taking its future into its own hands, and we must support them in this process.

Ladies and Gentlemen,

I have sought to portray for you today the potential for a new Transatlantic Agenda for Development. To quote what General Marshall said of the Marshall Plan, this new agenda I propose is “not against any country or doctrine, but against hunger, poverty, desperation and chaos.”

We must unite today in this fight and work with our partners in the developing world to build a future full of hope. We must make the next ten years count. Let us put our common interests of security, trade, health and development at the heart of the EU/US relationship.

Let us build a new Transatlantic Agenda for Development. If we work together, we can achieve the changes necessary to meet the MDGs by 2015. And that is a challenge we must meet.

Thank you for your attention.