03-13-2017

ECOSOC: Is Non-Official Foreign Assistance an option?

Rome. As part of the Rome MUN, the Economic Social Council (ECOSOC) had the topic of Foreign Investment on their agenda, specifically discussing the the Foreign Aid Intervention Situation. Currently, aid from emerging countries, including India and Russia, is revolutionising the development assistance sphere. The organisation and scope of today’s foreign aid systems can be traced to developments following the World War II era. It has to be distinguished between Official and Non-Official Development Assistance. Traditionally foreign aid is known as Official Development Assistance (ODA), it has come in the form of grants from developed nations, the United States, Germany, the United Kingdom, Japan and France being the largest donor states in 2015, channeled primarily through West-dominated multilateral institutions, such as the World Bank, and tied to structural adjustment programmes aimed at opening up the economies and promoting political reform in the recipient nations. The second form of foreign that is seeing a rise in popularity, is Non-Official Development Assistance (NODA). This is due to ODA having been unable to implement its stated goals of poverty reduction and improvement of living standards in developing countries. NODA operates by eliminating conditionality and introducing commerce, meaning that there are no regulations imposed on the recipient nations. The issue with NODA is that without conditionality and regulations, the developing countries often manage to decrease their unemployment rates, however, working under poor conditions and low wages.

The MUN ECOSOC council held a moderated caucus today, discussing different motions. The delegation of the Russian Federation asked for co-ordination and collaboration between developing countries and the formation of informal sectors, calling all countries to improve and regulate technology. The majority of ECOSOC member states voted in favour of Russia’s proposal. Kazakhstan expressed disagreement with the Russian delegation, stating that they didn’t condemn exploitation in developing countries and it can, in fact, be seen as an economical advantage. The delegate explained, that, in his opinion, „low-paying jobs and hard working conditions are better than no work at all“, questioning the other delegates: „If states want to give money to another country, why should we stop them?“

The delegations representing Argentina and Estonia strongly agreed with the Russian federations proposal, stating that dialogue and co-operation is needed. Estonia’s delegate strongly condemned and expressed horror at Kazakhstan’s remarks: „Estonia stands behind Financial Aid, in the past, in the present and in the future. Exploitation is not a win-win situation“. Austria stated, that they strongly support the idea of Official Foreign Aid as well, they do not completely oppose NODA, however, asked for better conditions and harsher regulations.

(Nina Zimmermann, Maya Popova, Büsra Demirkalp)

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