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An Ambitious Restructuring of the German TC Landscape

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published
7 May 2010

Dirk Niebel, German Development Minister

German Development Minister Dirk Niebel’s recently announced plans for a major reform of the country’s development institutions have been welcomed by international development organisations as well as inside Germany.

Under Mr Niebel’s plans, the German government is to merge German Technical Cooperation, GTZ, the German Development Service, DED, and Capacity Building International, Inwent into one organisation. Last month Mr Niebel gave a press briefing on the changes in German: http://www.bmz.de/de/presse/videos/2010/Maerz/20100324_reform/index.html.

The announced changes have been on the cards for years. According to Tom Pätz, who directs the working group on TC reform at the German Ministry for Economic Cooperation and Development, BMZ: “..cooperation among German development agencies is often rather superficial. Cooperation must become deeper for them to tap synergies. This problem was recognised a long time ago.” Read his comments in full on the Inwent website.

But bringing these three units together to form one organisation with some 14,000 employees, operating in around 130 countries with revenues that might easily exceed € 1.5 billion a year, is likely to present difficulties.

“The three organisations are legally quite different. Their funding is different, and they have different duties,” added Mr Pätz.

The Organisation for Economic Cooperation and Development, OECD, after reoccurring critical observations of the fragmentation of German development cooperation with its several institutions operating in developing countries, has welcomed the merger. Minister Niebel referred to the preliminary findings of the OECD’s current peer-review of Germany’s development cooperation at last month’s press conference. OECD’s previous critical comments were published in the OECD/DAC 2005 peer review of German Development Cooperation.

In essence, the reform aims to streamline TC organisations and make them more effective agents of development cooperation. It also seeks to enhance the political steering role of the ministry while clearly allocating implementation tasks to the new organisation.

If done successfully, the reform should enable better coordination with partners and permit greater coherence in German development cooperation internationally.

The German Ministry for Economic Cooperation and Development, BMZ, considers that the intentions of the reform fit well with the aid effectiveness agenda and related principles of the European Union’s Operational Framework on Aid Effectiveness.

Inside Germany, there is broad political support for the reform, encompassing most political parties and the non-governmental organisations.

But critics fear that efficiency goals could dominate more fundamental questions of development and could even result in a loss of valuable principles of solidarity, warned Ulrich Post, Chairman of VENRO, an umbrella organisation of non-governmental development organisations.

At the same time, other critics say the reform does not go far enough. Ute Koczy, speaks on development cooperation issues for the Green Party in the German Parliament. On her website, Ms Koczy writes that this step “is only a ‘small solution’ that needs to be followed by a big reform that merges financial and technical cooperation” in order to reform the complex German development cooperation landscape more fundamentally.

Such a substantial reform has been mooted in Germany before. But former Development Minister Heidemarie Wieczorek-Zeul failed to deliver as the task was too complex and triggered resistance from other ministries, GTZ itself and the German Development Bank, KfW.

The principal questions of the merger are tabled for resolution by July 2010. GTZ, DED and Inwent are closely involved in this reform trajectory. But observers expect this to be a tedious exercise given the organisations’ differences in size and corporate culture. While GTZ attracts those who want to work as ‘development experts’, DED is staffed by more idealistic ‘development workers’, say some observers who anticipate tensions along the way.

The merger is likely to throw up questions about the German development system in general, how it will be governed and many related issues - like how results are measured, or how partner country demands are met - are likely to come under the spotlight.

 

DISCLAIMER: This information is provided in the interests of knowledge sharing and capacity development and should not be interpreted as the official view of the European Commission, or any other organisation.

Comments

Very interesting article! I have a strange feeling that the creation of External Action Service has many similarities with the German 'merger'. But I think the big question is that those working in development field are not the only guys who have impact on development. And until we change our 'Weltanschaung' and manage to link the 'internal' European issues with the external ones, we shall not achieve a breakthrough.

On the other hand, maybe centralisation is not the best way of solving the dillemmas in front of developement? Maybe 3 organisations are more than one complex with vertical lines of command?

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