Need for donor accountability

The economists observed that the donors neither prioritise the country's own necessities nor move in the direction of mutual accountability of utilization of aid funds. They suggested exploring a mechanism to monitor and evaluate donor assistance to ensure transparency and accountability at the donor end. They also urged the donors to follow the guidelines adopted in the Paris Declaration for implementing the PRSP. According to the Paris Declaration of the Organisation for Economic Cooperation and Development (OECD), the aid recipient countries reserve the right to monitor the donor's aid programs.

The WB had made it mandatory for all its aid recipient countries to prepare a PRSP to become eligible to receive donor funds. Professor Rehman Sobhan, the eminent economist of the country, observed that 50 different countries with different economic and social conditions are implementing almost similar PRSP which revealed that the PRSPs have been imposed on those countries from outside. But India was a glaring exception who had had talks with WB on PRSP and finally did not prepare the PRSP, as they found their five-year plan was competent enough to advance their country.

Tap here to add The Daily Star as a trusted source

Finance Minister M Saifur Rahman strongly criticized the WB and IMF saying that the two donors "treat the finance minister as a clerk" in adopting policy prescriptions, particularly raising the fuel prices. He told this in a workshop on Action Plan for Public Financial Management held recently in the city. He also blasted the donors for their meddling in the domestic affairs of the country and said: "Donors must understand that the development programs of our country are owned by us, not by them and we will decide how we will implement them." He also said that the government would not be interested in any sort of aid relationship that would allow donor dictation.

There was a time when it seemed as if the whole economic affairs of Bangladesh were run by the WB and the IMF. The government was then compelled to go for many reforms under the pressure from the WB and IMF that did not suit the needs of the country. But the donors dictating policy formulation has increased significantly during the regime of the BNP-led alliance government compared to any previous regime since independence.

Prime Minister Begum Khaleda Zia while winding up her speech in parliament on March 15, 2005 categorically said that Bangladesh shall not be run by any dictation or order by any foreign force. The claim about the obstinacy of her government to donor pressure would be more credible if the government could be defiant against donor dictation veiled under advice and prescription.

But the government has been agreed to accommodate direct involvement of the donors in formulating its policies. According to a latest decision, the government had agreed to include representatives of the donors in eight sub-groups formed recently along with the government officials, to formulate polices and monitor their implementation. The major areas of their involvement include the financial sector, civil service and women's affairs and empowerment. The representatives will be from the WB, ADB, USAID, DFID, Germany, Sweden, Denmark, and Japan.

The Anti-Corruption Commission was compelled to pay Tk 25 million to have an organogram according to donor prescription from the consultants appointed by the donor. The Daily Star reported a few months back that Tk 108 crore was spent for the foreign consultants appointed in four nationalized commercial banks for their reforms under donor pressure which could be done by the local experts. These are only a few instances and such spree of appointing foreign consultants will surely weaken whatever institutional base we have in the financial sector.

The finance minister claims that Bangladesh has now almost achieved the position to implement its development programs without financial assistance from donors. If it is a fact, then the government must not capitulate to any external pressure, rather should administer a befitting reply to the donors dictating policy formulation. The government should not be subservient to the donors for a paltry amount of $1 billion while the expatriate Bangladeshis remit more than $5 billion a year.

Though the pressure and prescriptions from the donors were not a new phenomenon for a country like Bangladesh, their dictation and direct involvement in government policy formulation has added a new dimension to the government's submissive attitude. Donors have also become more demanding despite the fact that their aid flow to Bangladesh has reduced by a half in recent years.

The donors' direct involvement in the government's policy formulation is indeed a factor that has humiliated the nation's prestige. Everyone will agree that no sovereign government should be interfered in or dictated to by the foreign donors formulating its policies. So the issue of donor dictation in formulating polices needs to be discussed between the government and the donors on the basis of equals rather than yielding to the unwholesome pressure.

Time has come for monitoring donors in their aid apportion and directives for utilization by the recipients, as it is now being done by the donors themselves. The need for exploring a mechanism to make the donors transparent and accountable is also an emphatic opinion. Public agencies, professionals and stake holder's representatives may be entrusted to formulate the mechanism for monitoring donor aid to ensure transparency and accountability at the donor end. The donors also need to be better aware of taking an introspective look at their own selves.

ANM Nurul Haque is a columnist of The Daily Star.