The Sustainable Development Goals: a chance to play fairer?
27 October 2015
By Laura Sullivan, CONCORD Vice President
The New York fanfare is over. The new Sustainable Development Goals are agreed, on paper at least. But how do we make them a reality?
The tendency is to think about cash first. And cash matters. We need development aid. It acts as a lifeline to people all around the world, helping farmers get off their feet, helping women to get training to set up businesses. Supporting free quality education for all children. But aid is only one dimension of the effort to develop sustainably. So what else matters?
The answer is putting to bed some fairly glaring ironies. Policies like trade, investment, tax and arms are make or break when it comes to people and planet. My Oxfam colleagues quote the following example: in conflict ridden Yemen, most people are now dependent on humanitarian aid, a good deal of which comes from Europe. Meanwhile EU member states are a major source of Yemen’s arms imports. The EU funds great projects aimed at helping Africa advance on securing peoples land rights (realising the Voluntary Guidelines on Land Tenure) at the same time as it supports the G8’s New Alliance on Food Security and Nutrition, a ‘win-win’ investment framework that is catalysing land grabbing by agribusiness across Africa. Without the second win.
We all recognise the importance of taxes in financing democratic states, public services, social protection, supporting redistribution and more equal outcomes. We also know that they could be key in ending dependence on foreign aid. And yet today, developing countries are losing about $213 billion annually as a result of tax dodging by corporations. The EU is supporting this tax dodging spree by letting those corporations go unregulated, untaxed. How can it be that a British beer company, Saab Miller, based in Accra with a bottling factory that employs 2.000 people pay the same amount of tax to the Ghanaian authorities as an individual woman selling beer outside the factory door? The answer is transfer pricing. And this, is not being stopped. European citizens get the relevance of this. They saw it in the Starbucks scandal in the UK. They saw it again with Lux Leaks. The momentum is there now for real change. At the beginning of this year, Commissioners Vestager and Moscovici said that ‘this is the year for Europe to put its tax house in order’. In fairness, this is one area where many in the EU get the logic and are starting to push.
This could be the year for the EU to sort out its house on tax. It could also be a year to make its house less full of ironies. Like the great trade irony. We are led to believe by DG Development of the European Commission that the Economic Partnership Agreements, or trade deals, between the EU and Africa, Caribbean and Pacific countries, are an anti-poverty tool. They have changed their tune. Back in 2008 the former DG of DG Development Dieter Frisch said that ‘No one case is known of a country in an embryonic stage of economic development which has developed itself through opening up to international competition.’ In fact, the EU has acknowledged the competition problem itself by negotiating a waiver for Moldova ‘the poorest country on the European continent, which doesn’t have the competitiveness to undertake reciprocal obligations of FTAs with the EU’. But Africa is different? In the West African EPA, only 6% of tariff lines are products for which West Africa is more competitive than Europe. The problem is not trade per se. It is free trade between unequal partners. It will never end poverty. The reality is that it’s more likely to concentrate wealth in the hands of a few.
Why would anyone want unfair policies? Isn’t it in our common interest to fight climate change, for tax justice, for fair trade, for fair investments? Many argue the issue of the uneven playing field. There is a tendency to say that – if other countries outside Europe don’t play fair, why should we? The answer is that if we start giving in to that logic, it becomes a fairly grim race to the bottom. It also makes a mockery of Europe’s claim to be a global player that is about human rights, justice and an end to poverty.
Europe needs to see both sides of the coin, both the money that can support sustainable development and those policies that might make or break it. Development has been redefined along these lines. But where is the political will to make policies fair? So far, the furthest the European Commission has gotten on making its policies fairer in terms of legislative changes is working documents. This is a pretty bad indicator of where things are. In a recent report, Charles Goerens, MEP champion of fair policies, is proposing an arbitration system to be managed by the Commission President that will allow evidence of unfair policies to finally inform EU policy making and reforming. That is hugely sensible. The answer here is political – we need to see some serious political will to tackle this from EU leaders. But it’s also technical – we need laws, regulations, mechanisms to make policies fairer. We need them to be locked in and protected from the swinging pendulum of party politics. When governments change, we risk seeing years of commitments to fairness dissolve overnight.
In all of this, there is a great opportunity on the horizon. The Sustainable Development Goals and Agenda 2030 are a chance to lock in fairness on a global level, in the rest of the world and in Europe. People are asking how can we implement those goals? We could start by checking how our policies, like trade, agriculture, energy and tax, are impacting sustainable development. Everywhere. From the West of Ireland to Southern Africa, back over to Eastern Japan and on to Northern Brazil. Review them, reform them, make them more friendly to people and planet. The EU could use its position at globally to help the world join the dots between sustainable development and fair policies. It is in all of our interests to play fair.