Preparing for peace and development: the proposed Strategic Recovery Facility

During the 1990s, the international donor community pledged more than a hundred billion dollars’ worth of aid to some three-dozen countries recovering from conflict. These financial and material resources were intended to persuade warring parties to resolve conflicts peacefully, and to lay the foundations for a sustainable transition to economic growth and participatory government. There have been notable achievements – in Mozambique, Namibia, El Salvador and Guatemala, for example – but these are the exception, rather than the rule. Somalia, Sierra Leone, Burundi, Rwanda, the Democratic Republic of Congo, Bosnia, Kosovo and East Timor starkly demonstrate the costs and weaknesses of current arrangements. Often, aid promised has not been committed, aid committed has not been delivered, and aid delivered has arrived too late and been tailored to donor interests, rather than local needs. Moreover, the planning and implementation of reconstruction aid have frequently suffered from inadequate preparation, poor coordination and inconsistent conditionality. A new mechanism must be put in place to ensure a timely and effective response to the needs of societies recovering from conflict.

The dimensions of the challenge

Donors are still struggling to adjust humanitarian and development capacities to meet the transitional needs of societies emerging from war. Resources have been restricted by budgetary retrenchment and growing disillusionment about foreign aid in donor countries, while much of the aid pledged by the international community arrives only after considerable delays. In the case of Cambodia, for example, of the $880m pledged at the June 1992 Conference on Rehabilitation and Reconstruction, only $200m had been disbursed by September 1993, and only $460m by the end of 1995.

Conventional explanations for unfulfilled pledges or delayed aid delivery have tended to be one-sided, disproportionately reflecting either donor or recipient perspectives. In fact, both sides share responsibility for shortcomings in the design, delivery and implementation of aid. On the ‘demand’ side, states recovering from conflict often lack the capacity to absorb the considerable sums involved, and do not possess the administrative structures required to design and implement comprehensive recovery plans. Insufficient human resources, immature political institutions, under-developed legal frameworks, limited transparency and persistent (or resurgent) internal disputes undermine good governance and encourage corruption. Recipients often fail to meet conditions established by the World Bank, the IMF, UN agencies or OECD donors.

On the ‘supply’ side, the generous pledges announced at multilateral conferences may in reality consist of little more than previously-committed funds repackaged for political purposes. Rather than responding to objective recovery needs, donor governments at times design aid packages to reflect their own political interests, or those of their national service providers. Even when funds are mobilised, poor coordination among donors – and with recipient governments and NGOs – may result in duplicated or contradictory efforts, poorly-allocated resources and inappropriate projects. Delays may be exacerbated by lengthy bureaucratic formalities, protracted legislative reviews and cumbersome procurement procedures. In some instances, multilateral peace-building initiatives have collided with structural-adjustment programmes instigated by international financial institutions.

Although donors have taken tentative steps to formulate common principles and best practices, external support for conflict recovery remains a voluntary and essentially ad hoc enterprise. Bilateral donors, UN agencies and international financial institutions are selective in their involvement in particular countries, reinvent structures of coordination from case to case and often disagree on divisions of labour and burden-sharing. Bilateral donors tend to discriminate between crisis countries, with their level of engagement reflecting a combination of humanitarian, economic, diplomatic, strategic and domestic political interests.

Bilateral and multilateral donors face a number of challenges if they are to improve the coordination and impact of recovery assistance. They need to establish a shared conceptual framework and integrated approach to the early stages of conflict recovery, including a joint needs assessment. They need to involve key local actors in programme planning and implementation, and ensure a rapid release of adequate funding for programmes that will seed a lasting peace. Finally, the donor community must introduce greater accountability and transparency into aid delivery and implementation. A standardised system for reporting and monitoring pledges, commitments and disbursements, as well as sharper analytical tools to assess the impact of aid, would strengthen confidence in international assistance.

The Strategic Recovery Facility

Societies emerging from conflict face a serious gap in essential programme support as emergency relief begins to taper off, and longer-term reconstruction aid remains in the planning stage. This is a crucial period in which the bases for sustainable peace and development need to be established. To do this requires a coherent, shared strategy which involves local and international actors, includes rapid evaluation of local conditions and summons the resources to initiate immediate peace-building activities. But assessment missions tend to focus on enumerating infrastructure and population needs, ignoring the core political and social conditions that provoke crises and determine the possibility of recovery and sustainability.

To address this problem and ensure that the international community is prepared to facilitate a timely and effective response, the Center on International Cooperation at New York University has recommended the creation of a Strategic Recovery Facility (SRF). The proposed facility would bring key local and international actors together to jump-start the recovery process, and ensure that resources are available to fund essential elements of peace-building in the critical first 12 to 18 months of conflict recovery, until longer-term development assistance and private direct investment come on line. It would have immediate access to the expertise needed to undertake rapid assessments and design programmes, and to the resources needed to implement them.

Structure

The SRF is not intended to be a new international agency. Rather, it is conceived as a facilitating mechanism, its membership comprised of core organisations of the UN system, including the Bretton Woods institutions, regional organisations, contributing bilateral agencies and key operating NGOs. These members would constitute the operating arm of the facility, whose primary mission would be to ensure a timely and effective field-based response. The idea is to bring together key funding and operating agencies around a common agenda and programme of action that will enhance the individual response capacities of each participating agency.

A Board of Directors selected from among senior officials of member organisations would govern the SRF. It could include individuals drawn from the private sector. Ideally, it would be co-chaired by the president of the World Bank and the secretary-general of the UN, to signal their commitment to effective collaboration in the field, and at headquarters. A small staff would manage the SRF, maintaining a ‘watching brief’ on conflicts and convening member organisations to organise a response when circumstances seemed right. It would also conduct joint training sessions for affiliates’ operations staffs, and maintain rosters of experts in various fields known to be essential in post-conflict recovery.

Under the Board’s guidance, the SRF would establish a shared conceptual framework and integrated approach to the early stages of conflict recovery, weigh risks and opportunities and prepare contingency plans for a range of responses to ongoing conflicts. SRF staff would identify ‘trigger events’, such as the return of refugees, that justify the beginning of recovery assistance, and would act as the convening authority to initiate action, upon the advice of the Facility’s members. Such action would include organising joint needs assessments, working with other agencies to identify local partners and ensuring their full participation in all stages of the recovery process. On a case-by-case basis, the SRF would identify actions that require immediate support, focusing in particular on those that reinforce local capacity to sustain longer-term peace and development. Additional goals include facilitating the establishment of working public–private partnerships, strengthening mechanisms for collaboration and ensuring a common approach to evaluation, learning and training. Finally, the SRF would help to establish country-level funding mechanisms for on-going and longer-term activities, with a view to gradually phasing out as the country team and local capacity take over.

Financing

The SRF is designed to provide early investment in activities necessary to secure peace, and promote development. The investment required to achieve a sufficient level of preparedness for early intervention is small compared to the costs in opportunities lost – as well as prolonged expenditures – that the international community will continue to bear in the absence of timely action. In order to operate effectively, the SRF will require modest core expenses, contingency funds for two to three field assessments per year, and a larger ‘bridging’ fund for essential activities that fall between the cracks of current relief and development programmes. Core funds would be required to cover staff costs, situation monitoring, needs assessment and planning meetings. These costs could be met by cash or in-kind contributions from members, as well as through grants from public and private donors. Contingency funds would be used to enable the participation of non-affiliate experts in needs assessments, and to facilitate the participation of local actors in programme planning and implementation. Bridging funds would be available for up to 18 months for immediate, short-term recovery needs that go beyond emergency relief and rehabilitation to address those critical peace-building requirements that currently go unattended during this period.

What next?

Three questions tend recur with regard to the SRF:

• why create another level of bureaucracy?;
• how will better coordination be assured in this instance where in all others it tends to fail?; and
• will donors deposit monies in yet another trust fund?

The answers are to some extent anticipated within the Facility’s design structure. First, it is not intended to be another bureaucratic agency, but a small, ‘lower-case’ facilitating mechanism to ensure an effective field-based response. Second, pooled funding encourages coordination in ways that exhortation and best intentions cannot. Third, the ‘bridging funds’ for programme implementation will be pledged on a ‘stand-by’ basis, to be released to the field on receipt of an agreed plan of action.

Aside from these questions, and the concern that some regional and country desk officers have with regard to sharing authority and resources, the SRF proposal has enjoyed a generally positive response within UN agencies, and among key NGOs. It has received a pledge of $5m in matching support from the UK’s Department for International Development. This is subject to several conditions, among them that the Facility be kept small, flexible and bureaucratically unburdened; that it takes advantage of the latest technology in pursuit of its goals; and that it enjoys broad support. The proposal is currently under consideration by several other bilateral donors.

It is now time to move to the next stage in planning and implementation. With that in mind, the Center is organising a meeting of multilateral, regional, bilateral and non-governmental agencies to take the necessary next steps to make the SRF operational. At this meeting, we expect to further detail the design and functions of the SRF, and to choose one or two cases for initial action. We believe that the SRF holds considerable promise for resolving the vexed problem of how to respond in a timely fashion in crisis situations in order to build the bases for a durable peace and sustained development.

Shepard Forman is Director of the Center on International Cooperation (CIC), New York University. Stewart Patrick is a Research Associate at the CIC. For more on the CIC, see www.nyu.edu/pages/cic.

Resources

For a comprehensive evaluation of donor support for reconstruction, see Shepard Forman and Stewart Patrick (eds), Good Intentions: Pledges of Aid for Post-Conflict Recovery (Boulder, CO: Lynne Rienner, 2000)

See also:

Michael Renner, Budgeting for Disarmament: The Costs of War and Peace (Washington DC: Worldwatch Paper 122, November 1994)

James K. Boyce, Political Conditionality and the Implementation of Peace Settlements (Oxford: Oxford University Press for the International Institute for Strategic Studies, forthcoming 2001)

Krishna Kumar, ‘The Nature and Focus of International Assistance for Rebuilding War-Torn Societies’, in Krishna Kumar (ed.), Rebuilding Societies after Civil War: Critical Roles for International Assistance (Boulder, CO: Lynne Rienner, 1997)

David J. Rothkopf, The Price of Peace: Emergency Economic Intervention and US Foreign Policy (Washington DC: Carnegie Endowment for International Peace, 1998)