Monday, January 27, 2020

Key role for Progress Party in expanding business aid

Pål Arne Davidsen is the Progress Party’s only politician at the Foreign Ministry. The new State Secretary will oversee Norway’s private sector aid.

Davidsen told Development Today before the appointment that his party would bring in new ideas about how to engage the private sector more in aid.

His boss, Foreign Minister Børge Brende (Conservative), also says he would like to draw more on the private sector in Norwegian aid.

A spokesperson at the ministry says Davidsen will have responsibility for the private sector portfolio, which includes the aid-financed risk capital fund Norfund, currently the most important player in Norway’s private sector aid.

Davidsen, a 34-year-old political scientist, has been foreign policy advisor for the Progress Party in the Parliament.

According to the new two-party government’s platform, it will turn Norway’s diplomatic network into a more effective instrument for promoting Norwegian business interests abroad and energy will have a key role.

More focus will be placed on industrial development and investment in recipient countries through what the government refers to as “a modern and diversified combination of instruments”.

The government pledges that Norway’s USD 810 billion Government Pension Fund, the world’s largest sovereign wealth fund, will establish a programme for increasing investments in developing countries.

The first test of Norway’s Conservative-led government’s aid ambitions will come in a few weeks when it presents changes in the aid budget proposal for 2014. 

The Red-Green government presented a fiscal budget the day it announced its resignation, proposing a NOK 1.3 billion increase in aid to NOK 31.5 billion, which is estimated to be 1.0 per cent of Gross National Income (GNI).

Preparing a budget is a long process and, traditionally, an in-coming government can make only small changes the first year. 

In his budget proposal, former Development Minister Heikki Holmås (Socialist Left) pre-empted some of the new government’s announced initiatives.

Prime Minister Erna Solberg has, for instance, pledged to make support for girls’ education a top priority in Norwegian aid. During eight years in office, the Labour-led government was repeatedly criticised in Parliament for not giving education sufficiently high priority.

In its last budget before resigning, the government proposes a NOK 150 million increase in education aid and a near doubling of such support to NOK 3 billion over the next four years. 

The budget proposes small changes in UN funding, an area where the Conservative Party has promised to slash funding to UN agencies that do not perform well. The new government’s declaration states that Norwegian support should shift towards organisations that deliver “good results efficiently” and in accordance with Norwegian interests.

The Solberg government hails the human rights agenda and might well make symbolic cuts in aid to Ethiopia or countries in Latin America. The number of Norwegian peace broker engagements is to be assessed with a view to prioritising processes and countries where Norway has resources and competence to achieve results.

However, Foreign Minister Børge Brende will most likely move forward cautiously, and the main changes will not come until the budget for 2015.