Aid Conditionalities and Democratization: Between a Rock and
Hard Place
--Ahalya Dakshana
Cynical, war weary, yet desperate for hope, progressive activists
interested in expanding democratic space in the North and East
of Sri Lanka look to the peace process for even a hint of an opportunity
to loosen the grip of an authoritarian dispensation. Having suffered
a long bleak period of war and repression, the region remains
militarized and politically sensitive. In this tense and constrained
environment such activists have few tools available to them.
In anticipation of the flood of donor dollars into the region,
we are increasingly confronted with a dilemma in deciding whether
or not to mobilize the power of donor aid conditionalities in
support of democratizations efforts. In the short term, given
the stakes involved, do we have the luxury to not utilize every
tool that may come our way? Yet we must use any tool strategically
– with a full accounting, as it were, of the long-term costs of
acting to address our current constraints.
Through out the global south, the left has long been critical
of the power that donor institutions and donor countries wield
by virtue of the power of the purse. Institutions such as the
IMF, the World Bank and USAID have been able to dictate everything
from macro-economic policy to commercial law with little accountability
to the communities most affected (the key “stakeholders” to use
‘development-ese’). In country after country even governments
elected on a mandate that entailed issues such as basic welfare
provisions, labor rights, environmental protection and such, have
then peeled back these protections, dismantled labor laws, and
done away with welfare protections when the IMF has conditioned
future loans on such action (in the name of fiscal accountability).
In fact, what is striking about the massively intrusive power
wielded by such institutions is not only that these institutions
themselves are not democratically accountable, but moreover, that
they actually make the governments concerned less accountable
to ‘the people’ as well, since, in many contexts, government policy
is determined more by donor agencies/governments than by the people
of the country. In such cases top-down fiscal accounting by institutions
such as the IMF, in effect, crowds out bottom-up democratic accountability!
Democracy activists have long been opponents of donor power not
only because donor agencies were so complicit in curbing local
democratic accountability in the countries they engaged with,
but also because the policies they pushed had no relation to the
priorities and well being of the vast majority in the ‘recipient’
countries. Thus in many cases donor agencies kept funding governments
that complied with a donor agenda for liberalization that enriched
local elites who instituted the most repressive measures against
the population. The funding of pro-market despotic regimes in
Central and Latin America in the Reagan years was in many ways
the paradigmatic example of this policy. In these cases, donor
funding in effect bank rolled the most authoritarian and exploitative
governments. In this context donor institutions began to face
increased pressure to ensure that, at the least their funding
was linked to some basic conditionalities addressing human rights,
environmental issues, democratization and such.
This pressure came from a range of sources, including human rights
advocates globally, taxpayers from Northern states, social movements
in the South, and progressives within these organizations. For
some this was framed in terms of the indivisibility of civil and
political rights and socio-economic rights. Interestingly the
link between economic issues and political issues was also pressed
by some key figures on the political right – thus there were economic
conservatives who argued that a minimally representative democracy
was actually a more efficient political system for economic growth.
To some extent all these impulses came together in the increased
emphasis on human rights conditionalities that we have seen in
recent years. Since the nineties at least, it seems a fairly
widespread phenomenon that donor countries and donor agencies
have internal regulations regarding human rights that serve as
a checklist alongside the economic policy conditionalities that
attach to aid grants. After the last decade then, the question
we face is whether the incorporation of human rights aid conditionalities
expanded democratic space in regard to aid, and the range of issues
that attend macro-economic policy making in the global South.
What was the impact of top-down human rights accounting on processes
for bottom-up accountability?
While undoubtedly there were local victories in many places (Wasn’t
prisoner X released because her name was brought up in negotiations
with a donor? Wasn’t election monitoring permitted in country
Y because elections co-incided with a donor meeting? Wasn’t money
allocated for Z women’s rights group because of donor interest
in ‘gender’ programming?), the question is whether there are some
broad trends that should make us wary about aid conditionalities.
To some extent the worry is that the concerns of progressives
were appropriated by institutions such as the IMF and the Bank
and deployed in ways that further entrenched their control of
the agenda in countries of the South. The Washington consensus
was largely seen as coupling a neo-liberal agenda with a minimalist
formula for a ‘regulative’ democracy that stressed those background
legal conditions that oiled the wheels of global capital, in particular
property rights and contract law that facilitated market transactions.
Thus in many cases this package of a minimal, representative
democracy and an unfettered market may have actually suppressed
participatory democracy, crushed the space for institutional experimentation
and the enabling conditions for an empowered citizenry. Often
it naturalized the USAID model of democracy as the normative ideal,
and lowered the bar on democratization in ways that preempted
more radical struggles. Invariably, the conditionalities package
not only accompanied the most regressive macro-economic polices,
but also entailed conditionalities that demobilized social movements
aimed at asserting economic rights and the efforts at rendering
macro-economic policy making accountable to the economically marginalized.
Thus it has proved difficult to push for conditionalities regarding
transparency and accountability that expand democratic space,
without also opening the doors to a range of other conditionalities
that may cramp democratic space.
Ironically then, even those aid conditionalities that (at the
instigation of human rights and democracy activists) were intended
to set some minimal standards for democracy, may have, in fact,
operated as maximal caps that curbed the potential for deeper
democratization. Moreover the linkage with human rights and democratization
may have actually further legitimated the neo-colonial reach of
aid negotiations. For many democracy activists the complaint
against the aid conditionality package was not that it violated
state sovereignty (after all, ‘state sovereignty’ was itself often
counter-posed to popular sovereignty). Rather, their focus was
on how negotiations over aid conditionalities often corroded ordinary
people’s control over the terms of their lives, their communities
and their ostensible representatives in government.
It is against this backdrop that those interested in expanding
political space in the North and East of Sri Lanka face the dilemmas
alluded to at the beginning of this paper. It is not a question
of putting one’s uncritical faith in aid conditionalities – but,
whether we nevertheless press for conditionalities (as problematic
as they are) as a lever to wedge open political space? This is
a context where the LTTE has not only eliminated the space for
any alternative credible political parties, it has also brutally
curbed the space for dissent such that there are no local civil
society organizations that can operate openly if they want to
retain political independence. In addition, this is a context
where the government of Sri Lanka has no real commitment to the
civic rights or well being of the Tamil people and is quite happy
to write them off to the LTTE in exchange for donor funds flooding
their coffers. Finally, this is a context where many in the international
community seem happy to see a peaceful North-East as a new terrain
for investment and profit, and are thus willing to promise millions
of dollars to the post war regime – promises that have already
put a greedy gleam in the eye of both the LTTE and the GOSL.
It is then, in this context that one of the few strategies that
can actually pack some punch with the LTTE and the GOSL seems
to be an effort that links these dollars to democratization and
human rights safeguards, i.e. pressuring donor agencies to focus
on aid conditionalities.
This then is the dilemma – on the one hand, aid conditionalities
appear to be quite seductive as a lever against the LTTE and the
GOSL in a context where activists have very little space to exercise
pressure. On the other hand, as we have discussed above, in many
cases, aid conditionalities further bolstered donor agencies’
power over the terms of ordinary people’s lives – if we sleep
with the devil do we further entrench top-down accounting at the
expense of bottom-up accoutnability? Is this, in effect, an effort
to lever aid conditionalities to expand the space for local accountability
in the short term, while, in the long term, entrenching patterns
of decision making that are answerable primarily to aid agencies?
Can we resolve this dilemma by developing ‘smarter’ conditionalities
that offer a more complex strategy for transnational actors to
be mobilized in furthering local democratization efforts? This
may be a question of not only continuing to separate democracy
enhancing conditionalities, from democracy curbing conditionalities,
but also rethinking the form of aid conditionalities. Perhaps
moving to ‘process’ based conditionalities? For instance, rather
than have aid conditionalities premised on a check-list of human
rights criteria (no extra judicial killings, torture, disappearances,
child recruitment etc.), design conditionalities that impose a
burden on the LTTE, GOSL, development NGOs etc. to take proactive
steps towards deeper democratization (not just elections in the
North and East, but also creating space for alternative media,
unions, multiple parties; to have any development initiative build
in consultative mechanisms that can allow those most affected
shape its priorities; to have independent civil society deliberation
and discussion on how the most vulnerable sectors of society are
affected/can participate in/direct such initiatives etc.). Namely,
can we shape aid conditionalities to contribute to bottom-up democratic
accountability, rather than top down human rights accounting?
Obviously democracy cannot be set in place from above. Thus
do process based conditionalities presuppose a mobilized civil
society that can take ownership of processes that are catalyzed
by donor pressure, but can reach their potential only if then
shaped by local communities? It seems clear that conditionalities
attached to donor dollars should be conceptualized in relation
to the capacity of local civil society in assimilating/transforming
these openings to deepen local democracy and build social movements
among marginalized communities. Yet the difficulty is that an
already mobilized and independent civil society is not available
to us in the North and East.
Ultimately all we have is an identification of the dilemma –
putting the call out for creative strategies….
_________________________________________________________
Ahalya Dakshana is an independent writer and activist.
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