Brazilian International Development Cooperation: Budgets, Procedures and Issues with Engagement
BY SEAN W. BURGES
One of the hot potatoes being passed around the policy branches of most major international development agencies is the question of what to do about the rising group of development actors who are not part of the exclusive club that meets in the Organization for Economic Cooperation and Development’s Development Assistance Committee (OECD-DAC). How can the financial might of China be managed? Will India’s sudden engagement with Africa destabilize the continent’s fragile economies? What exactly are the Gulf States and Saudi Arabia doing and why? What is the intent and scope of Brazil’s rapidly growing panoply of development cooperation activities? With the exception of a small body of detailed scholarship on the Chinese case (Bräutigam 2009; Strauss and Saavedra 2009; Samy 2010), the problem facing policy makers, practitioners and scholars is the low level of information about what these new actors are doing and how they are going about their development cooperation activities. In the Brazilian case we find an institutional structure that parallels those found in the North, but with a streamlined administrative approach operating free of OECD-DAC restraints. This has created a nimbleness that is allowing Brazil to pursue effective development cooperation programming in a manner that also supports the country’s foreign policy agenda. As will be argued, this presents something of a conceptual and practical challenge for established development agencies seeking to partner with Brazil. To explain this argument, the article first sets out the institutional framework and the sums involved before offering some avenues that international development actors seeking greater engagement with Brazil might find fruitful.
INSTITUTIONAL FRAMEWORKS
Brazilian development cooperation activities are coordinated by the Agência Brasileira de Cooperação (ABC–Brazilian Cooperation Agency). Originally established in 1987 to coordinate incoming development assistance, the mandate of ABC has expanded over the last decade to include coordination of out-flowing technical assistance, which is now its major activity. As was the case in a number of other Latin American countries, ABC was originally created as a directorate within the foreign ministry, known as Itamaraty. The rapid acceleration over the last five years in the Brazilian provision of South-South technical assistance for development has not resulted in any formal changes to where ABC sits within either Itamaraty or the wider Brazilian bureaucracy. Leadership of ABC continues to be formally classified as a post for a mid-level diplomat managing a small team of lower-ranking diplomats. A similar treatment is given to the Agency’s budget, which remains bundled into the larger Itamaraty operating account reported annually to Congress. While some Western development agencies are also housed within the foreign ministry, detailed budgets are generally a matter of public record that is reported both to national legislatures and the OECD-DAC.
Despite the still-unchanged formal status of ABC within the Brazilian state, there have been major practical changes on an operational level. Perhaps most symbolic is the physical location of the Agency’s new offices. The Itamaraty Palace complex that houses the foreign ministry is comprised of three main buildings connected by a series of wide covered foot bridges, symbolically ensuring that all activities are under the control and supervision of the foreign minister. This symbolic linkage reflects a highly disciplined approach to foreign policy making in Brazil that draws on a strict hierarchy for decision-making and external interaction (Almeida 2001; Cason and Power 2009). The current ABC offices are in a new building several hundred meters away from the Palace complex, within sight and thus oversight, but physically detached and thus slightly out of mind for the daily business of most diplomats.
The symbolism of ABC’s physical location is reflected in the manner in which it is staffed and operates. One of the complaints from Brazilian observers close to the development cooperation file is that the main ABC jobs are occupied by career diplomats, which some view as a black mark on their record because it takes them away from the substance of real diplomacy. This attitude has shifted somewhat in response to the Lula administration’s South-South foreign policy focus and use of technical cooperation as a door opener in Africa. ABC Director Marco Farani has cleverly leveraged the widening of Brazil’s foreign policy orientation during the Lula years to build a surprisingly widespread consensus that the Agency’s activities are a good thing for Brazil. Other players in the foreign policy complex might grumble about a lack of strategic direction, but not about the existence and activities of ABC and the contributions it makes to Brazil’s international standing. As will be set out in the next section, this has resulted in a rapid increase in the number of files managed by ABC, but due to the exigencies of Brazilian labour laws, not a corresponding rise in the number of permanent employees at the Agency. While there are now over 160 people working at ABC, some of these employees are funded through a sideways shuffle that sees Brazil paying the United Nations Development Program to hire a staff on two-year contracts to keep ABC administratively afloat. While Farani does have ambitions to create a development policy officer career stream either within Itamaraty or an independent development agency, it is uncertain if this will happen anytime soon.
The lack of a specialist development officer cadre is not a major problem for the Agency as it currently operates. Unlike OECD-DAC-member development agencies, ABC is entirely responsive. Brazil’s formal policy is that it does not offer to do things for other countries, but responds to requests. Sometimes the response involves suggesting that a bigger or smaller project might be more appropriate. This means that Brazil is not conducting independent analyses of national development plans, restricting its decision-making analyses to an assessment of whether or not the project will work as an end in and of itself. When it comes to starting projects, ABC does not carry out the work itself, but acts as a matchmaker between the requestor and an organ of the Brazilian state with expertise in the program area. Projects are not contracted out to independent consultants and NGOs. All of this greatly reduces the administrative burden that ABC must carry in comparison to established development agencies. In effect, the existing accountability and evaluation processes of the state are used to monitor activities, obviating the need for the complex monitoring and auditing functions that require so many desks in Northern agencies.
BUDGETS AND GROWTH
The official Brazilian figure for expenditure on development cooperation between 2005 and 2009 is US$1.426 billion (IPEA 2010: 21).
Of this total, US$1,082.2 million was spent on contributions to international organizations, US$125.6 million on technical cooperation, US$138.8 million on scholarships and US$79.1 million on humanitarian relief. Of most interest to other development agencies is the technical assistance budget, which rose from US$11.4 million in 2005, to US$48.9 million in 2009, increasing its total share of the development cooperation budget from 7.22% to 13.49%. In practical terms this meant that by 2009 Brazil had undertaken over 400 projects in 58 different countries, some of which are mapped out in detail in a high-gloss publication on ABC engagement with Africa (ABC n.d.).
On the surface these numbers do not appear particularly large, masking the impact that this level of expenditure is actually having. Brazil only provides assistance in the form of technical personnel. It does not provide budgetary support or other forms of cash transfer or product purchasing. Some of the projects undertaken by Brazil are large in scale and require the mobilization of significant resources, such as an experimental farm program in Senegal, national health system reform in Angola and a professional training program in Mozambique. Brazil is able to tackle these programs on a lower budget because the necessary expertise is sourced entirely from within Brazilian government ministries and institutes. Brazil hence does not rely on external consultants and NGOs often used by Northern development agencies. This approach offers two immediate benefits. First, it is more cost-effective. The participating state organs absorb the costs of the project within their own administrative budgets, seeing the potential for gaining valuable international experience by participating in South-South cooperation initiatives. As a result the administrative cost-base for the needed expertise is lower than that of external consultants because there is no need to maintain contract management and evaluation infrastructure within either ABC or the participating state organ.
The second benefit to the ABC approach is that the sorts of questions being addressed through the South-South technical cooperation programs are the same as those driving Brazilian public policy. Brazil’s state sector possesses the necessary world-leading expertise in a number of areas crucial for development programming. The Brazilian Corporation for Agricultural Research (Embrapa) is a leading institute working with tropical and arid zone agriculture. Environmental and resource management expertise directly related to development issues is found in the Institute of Environment and Renewable Resources (IBAMA). Health system reform and public health programming innovation and delivery in Brazil’s has reached a high level in part due to the work of the Fundação Osvaldo Cruz (Fiocruz) and vocational and technical training programs developed by SENAI have emerged as a model for other developing area. The impact of these state-based institutions shows in the distribution of the technical cooperation provided by Brazil. Twenty-two percent of assistance is in the agricultural field, 16.6% in health, 12.6% education, 11.8% in public administration and public security, and 7.5% percent in the environment (Cabral and Weinstock 2010: 6).
While officials at ABC, Itamaraty, the presidency and other government departments are clear that there is no direct linkage between the provision of development assistance and specific foreign policy or commercial policies, a higher level linkage remains in place. The geographic division of technical cooperation expenditure aligns tightly with Brazilian efforts to lead South America (recipient of 23% of assistance), increased penetration of Central America and the Caribbean (12% of assistance), and the building of new relationships in Africa (50% of assistance) with a heavy concentration on Portuguese-speaking countries. The complaint of some ABC observers within the Brazilian government is that technical assistance projects have at times been announced almost as hospitality gifts to create a positive impression when the president or foreign minister travels abroad or receives visitors. There is consequently sometimes a sense that the projects lack the adequate political or developmental follow through necessary to convert them into not only wider-ranging development assistance initiatives, but also vehicles for deepening bilateral relationships.
AVENUES FOR ENGAGEMENT
A keen awareness in Itamaraty of the relationship building aspect of development assistance is evidenced in the details of the trilateral cooperation agreements Brazil has signed with France, Germany, Italy, Japan, Spain, the UK and the US. Each contains very clear language specifying how projects will be branded and what steps must be taken to ensure equal credit is given in related communications materials. The same agreements are also very clear that Brazil will make contributions in kind, not cash. This has caused hesitation for some potential trilateral partners who have viewed the Brazilian approach as being akin to a Northern country paying for Brazil’s foreign policy gains through the provision of technical assistance. The crux of the issue here is why a country is engaging in development cooperation and why it would choose to work trilaterally with Brazil.
The first answer is that the real interest for the Northern country is using development cooperation to build relations with Brazil. This appears to underlie the approach taken by Japan, the US, the UK and most recently Canada. The Japanese approach actively funds trilateral programs undertaken by Brazilian agencies in issue areas and countries of mutual interest, which is much the same approach practiced trilaterally with other countries such as Egypt and South Korea. Payoffs in the assistance-receiving country are diminished, but linkages with Brazil expanded. In the case of the US, the UK and potentially Canada the focus has been more heavily on policy engagement. The US has gone so far as to launch a formal staff exchange program between USAID and ABC to encourage mutual learning and quietly attempt to pull the Brazilian agency into line with US aid practices. Similar initiatives are being undertaken by the UK through a study program examining how ABC institutional efficiency might be approved. Canada’s recently announced memorandum of understanding on aid effectiveness is tightly focused on policy discussion to seek out efficiency in the provision of development cooperation. This somewhat abstracted approach reflects some of the administrative ambivalence in Canada to further program cooperation with Brazil after reasonably successful projects on the ground in Haiti created a series of bureaucratic headaches within government accountability structures.
The question of bureaucratic headaches should not be underestimated as a deterrent for engaging in program-based trilateral work between Brazil and Northern donors. Little progress on harmonizing oversight approaches has been made despite years of discussions at the OECD-DAC. Even countries that have taken a second approach to engaging Brazil—focusing on the delivery of trilateral programming mostly to ensure that good results are achieved—admit that there are substantial administrative challenges. Development agencies from countries such as Canada, Germany and the UK have struggled with the inherent potential in accessing Brazil’s expertise while simultaneously dealing with the peccadilloes of their own central finance accounting regulations. Germany has stuck most strongly with the trilateral approach while Canada and the UK have seen some continued programming focused more on achieving results in the recipient country than building political links.
As Australia has recently discovered with its return to programming in Latin America, the official view in Brasília of Brazilian development cooperation is that while it remains consistent with the country’s Southern political and economic agenda, it remains a tool that can be used to advance foreign policy prerogatives. While Australia would like to use trilateral work with Brazil to build links in Latin America, the response from Itamaraty has been that it might be much more interesting to examine possibilities in the Asia-Pacific. The lesson here is that Brazil is willing to entertain trilateral programming or work with other development agencies, but only if it offers some sort of policy return to Brazil in addition to developmental results from the project.
It is this realpolitik approach to engaging in development programming that is causing issue for international aid bureaucrats who have internalized the lofty ambitions of the 2005 Paris Declaration on Aid Effectiveness. Significantly, the clear Brazilian sense that positive development outcomes and foreign policy advancement do not need to be mutually antagonistic is what has allowed support for ABC to grow within a domestic policy context where over 25% of the population remains under the poverty line. Perhaps more importantly for global development outcomes, despite the domestic poverty challenge ABC activities are forecast to grow with some observers predicting a staffing growth to 800 by 2020 administering a budget of $400 million. The difficult aspect for the Northern agencies is that this growth will likely take place outside the auspices of the OECD-DAC and within a wider policy milieu that sees development assistance programming as an accoutrement to poverty reduction, not as the essential starting point.
Sean W. Burges is based at the Australian National University where he is a lecturer in international relations with the School of Politics and International Relations and a senior associate with the Australian National Centre for Latin American Studies. Prior to joining ANU he was a senior policy analyst with an OECD-DAC-member development agency. He is author of the book Brazilian Foreign Policy After the Cold War (2009) and articles on Brazilian foreign policy and inter-American affairs in journals such as Third World Quarterly, the Bulletin of Latin American Research, International Relations, Global Society, and the Cambridge Review of International Affairs.
REFERENCES
ABC (n.d.), Agência Brasileira de Cooperação: A Cooperação Técnica do Brasil para a África (Brasília: Agência Brasileira de Cooperação): (English version http://www.abc.gov.br/download/CatalogoABCAfrica2010_I.pdf).
Almeida, Paulo Roberto de (2001), “Dez Regras Modernas da Diplomacia,” Revista Espaço Acadêmico 1 (4) (Setembro).
Bräutigam, Deborah (2009), The Dragon’s Gift: The Real Story of China in Africa (Oxford: Oxford University Press).
Cabral, Lídia and Julia Weinstock (2010), “Brazilian Technical Cooperation for Development: Drivers, mechanics and future prospects,” Overseas Development Institute.
Cason, Jeffrey W and Timothy J Power (2009), “Presidentialization, Pluralization, and the Rollback of Itamaraty: Explaining Change in Brazilian Foreign Policy Making in the Cardoso-Lula Era,” International Political Science Review 30: 117-132.
IPEA (2010), Cooperação Brasileira Para o Desenvolvimento Internacional: 2005-2009 (Brasília: IPEA/ABC).
Samy, Yiagadeesen (2010), “China’s Aid Policies in Africa: Opportunities and Challenges,” The Round Table 99 (406) (February): 75-90.
Strauss, Julia C. and Martha Saavedra, eds (2009), China and Africa: Emerging Patterns in Globalization and Development (Cambridge: Cambridge University Press).
