Politics and Power in International Development - The potential role of Political Economy Analysis Geert Laporte, Deputy Director, ECDPM VIDC, Vienna, 30 January 2014

1. The potential role of Political
Economy Analysis
Geert Laporte, Deputy Director
VIDC, Vienna, 30 January 2014
Politics and Power in
International
Development

2. 1. What is ECDPM?
2. Changing perceptions on the role of
politics in development
3. WHAT is Political Economy Analysis
(PEA)?
4. WHY is PEA needed?
5. Implementation challenges
Structure presentation
Page 2

3. Independent foundation: Linking policy and
practice in development
1. Non-partisan facilitation of dialogue and
consensus building
2. Practical and policy relevant analysis
3. Strong networks, partnerships, alliances…
4. Capacity building in Africa to bring more
balance in the partnership with the EU
5. Ambition to systematically integrate the
political dimension in development and be a
change agent
ECDPM
Page 3

4. 1. Post WOII- 1990: mainly technocratic and economic vision
on development
1. 1990s-2000s: End of Cold War: more political approach to
development (governance, rule of law democracy, human
rights, etc) but MDGs still largely a-political
1. 2011: Busan declaration: a more political vision on
development: policy coherence, role new actors, good
governance etc
1. Post 2015: focus on structural transformation-inclusive
growth-global power relations-peace and security-clear
ambition to integrate politics in development
Changing perceptions on the role
of politics in development
ECDPM Page 4

5. Integrating politics into development:
an ongoing challenge

6. Cooperation becomes more political
in most agencies… at least on
paper…
• Increasing recognition in donor strategies and
policy documents that cooperation is a highly
political job (reflected in choice of countries,
sectors, actors, etc)
• But still actors who tend to avoid politics from
their agendas because too “risky” (charity &
development foundations such as Gates )
Page 6ECDPM

7. Stop putting your head in the sand …
It is all about politics and power…

8. • Lots of EC Communications all going in the
same political direction: democracy,
governance, human rights, working with
CSOs,.. (e.g Agenda for Change)
• “More for more” in Arab world (aid and
trade in exchange for political reforms)
• Financing of civil society and change
actors (European Endowment for
Democracy)
Example EU
ECDPM Page 8

9. • Risk of being normative and “imposition”
of donor conditionalities (Governance
facility EU)
• Risk of overestimating the role of aid in
political reform processes
• Risk of using double standards (difficult to
reconcile values and interests of donors)
Major inconsistencies in applying
political approaches
ECDPM Page 9

10. • NOT the same as a ”governance analysis”(=normative
and looking at formal political systems)
• NOT the same as “political analysis” (mostly done by
diplomats)
• NOT the same as “policy analysis” (looking at specific
policies in different sectors)
PEA “The study of the interrelationships between political
and economic processes” (looking at both formal and
informal institutions “behind the façade”)
“Political economy as a discipline is a complex field,
covering a broad array of potentially competing interests
on how a country should develop”.
Agreeing on what political economy
analysis (PEA) means
ECDPM Page 10

11. Political processes:
contestation and
negotiation of power,
wealth and goods
Economic and
financial processes,
and their link with
politics
Formal and informal
institutions
Relations, incentives
and interests of actors
« under the surface »
Why do
reforms fail
to take root?
Need for a
systemic
approach
with a
specific
focus on:
The visible world:
national strategies,
action plans, formal
institutional
structures, etc.

12. • Moving beyond the formal attributes of
democracy (elections, Parliaments, etc)
• Need for more realism on the feasibility
of reforms
• Identify relevant « entry points » to
support real change dynamics
• spend the money wisely for better
impact and structural change
• PEA in principle should not be
normative
WHY political economy
analysis?
ECDPM Page 12

13. LOOKING BEHIND THE FAÇADE …

14. More tools available
• Mix of tools exist already: governance assessments,
mappings of CSOs, conflict analysis tools, budget support
guidelines, drivers of change methodologies, Strategic
Governance and Corruption Analysis (SGACA) etc
• BUT in most cases tools are quite superficial, based on
formal commitments of governments and not enough
attention to economic dimension of political behavior
• Tools to detect traction for reform in societies are short in
terms of concrete action
Page 14ECDPM

15. • PEA is a “risky business” as it could fundamentally
change the “technocratic” way in which donors
operate
• Vested interests on both sides of the aid business
might be difficult to reconcile with in-depth PEA
(diplomats fear to spoil privileged relationship with
government of developing country
• Spending pressure is big (0,7% target) and PEA
could limit scope of action in countries with
governments unwilling to change
“ It is the aid industry’s job to disburse funds and
its operators are paid to do so and to maintain
good relations with its client countries” (Deaton
“Aid and politics”)
In PRACTICE aid agencies seem to
be afraid of PEA
ECDPM Page 15

16. • Donor agency staff is not always well equipped to
play a political role (“often we don’t have the time or
resources to do PEA in a systematic way”)
• Not enough highly skilled personnel with strong
knowledge of local context
PEA acts like a mirror confronting donors with
their own political economy (own interests,
incentives, inconsistencies, lack of capacities…)
EU decision to discontinue PEAs with external
support
In PRACTICE aid agencies are poorly
equipped to deal with PEA
ECDPM Page 16

17. No shortage of reform attempts that stopped
halfway or never got anywhere…

18. 1. Integrate PEA in all aspects of the development
process and cooperation (interests, power
relations, incentives of the various domestic actors to
change,…)
2. Change is a domestic process: get to know and
support in a subtle way the actors of change
3. Look beyond the formal expressions of political
systems (e.g Mali as “donor darling”)
4. Avoid normative approaches: focus on what is
desirable and feasible instead of dreaming up “ideal
world”
5. Look for smart incentives: reforms cannot be
bought by external agencies with aid
Implementation challenges for
donors
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19. What incentives could accelerate change?

20. Conclusion: Progress but also
limitations to PEA
• Centrality of politics is there to stay:
integrating PEA in all aspects of cooperation
• Growing demands for better tools for PEA
and to operationalise these in a subtle way
with respect for specificity of each country
• Engaging with partner country on PEA :
how far can you go … and for what
purpose…?
• PEA provides “navigation tool”… not a
panacea for quick decision-making/planning
Page 20ECDPM

21. Concluding quotes
• Carothers: “don’t expect revolution, politics will
always remain a difficult element to integrate in
cooperation and aid”
• Will Hout: “Donors that take PEA seriously will
become part of the political struggle. Otherwise
they risk following the road to nowhere”
Page 21ECDPM

23. Thank you
gl@ecdpm.org
www.ecdpm.org
www.slideshare.net/ecdpm
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