Putting aid in perspective

European Commission President José Manuel Barroso is now in Jakarta, Indonesia, attending what is the first of what will be a tidal wave of aid conferences.

Needless to say, after a lacklustre performance, he is now seeking to grab the headlines, claiming the glory for the generosity of EU member states. He has announced an "additional package" of aid, up to $585 million, claiming that this brings "the total support from the European Union" to around $2 billion.

Of course, this is not European Union aid, but if Barosso says it quickly enough, some gullible hacks may be fooled by it and give the commission president the headlines he so desperately craves.

Interestingly, Barroso has also announced a "proposal" for a $1.3 billion "Indian Ocean Tsunami Lending Facility," to be managed by the European Investment Bank, which will also grab the headlines – although it must be approved by the member states who underwrite the EIB. Therefore, Barosso is grabbing further headlines for a proposal for other people to spend money.

One wonders, also, how this ties in with Gordon Brown's initiative on granting debt relief to developing countries. Do we releive them of this burden so that they can go out and borrow money from the EIB?

Meanwhile, a sharp debate is being played out in German newspapers about the "selfish donation competition" on tsunami aid. The left-leaning Die Tageszeitung is complaining that "Prestige now seems to be playing a significant role in the wave of donations… "Everything now appears to be a size too big." It adds that even one minute of silence on Wednesday wasn't enough for Europeans - they needed three, adding, "Perhaps it would be a good idea to slowly direct some of the generosity back towards the Sudan, Congo or Uganda where it is no less urgently needed."

The conservative Die Welt is suggesting that the Berlin government is using its massive donation as a cynical public relations campaign. Schroeder is "skillfully using the tsunami disaster in order to portray himself as a compassionate politician and an international man of action," it writes. Even though "every other politician would do the same," the paper still finds Schroeder's reaction "disquieting."

While it is legitimate for the government to increase its aid pledge, it asks: "Do sums have to be pledged which give the impression that the nations are in a selfish donation competition?" The editorial notes that debt-strapped Germany, which has repeatedly violated EU rules for deficit spending doesn't even have the money to give. For unlike private donors, "the government is giving money it doesn't have."

The business daily Handelsblatt is asking how the German government will piece together €500 million from the state coffers, noting that making money available isn't the only challenge awaiting the international community. The region must now be rebuilt, and that will require a colossal amount of coordination.

But, expressing a sentiment that could just as well apply to US aid, the Frankfurter Rundschau, which is majority-owned by Schroeder's political party, the Social Democrats, defends the government's generosity. "The suggestion that increasing Germany's aid is pure political calculation is unfair and cynical," the editorial claims. "Millions of people who are urgently in need of aid and of a future will not be asking whether the water from their new purification plant flows along with personal or politically strategic motives."

However, just to put all the largesse in perspective, according to DefenseNews, the Indian government has this week issued a request for information to overseas defence companies for what would be the country’s largest one-time purchase of defence equipment. This is for 120 multi-role combat aircraft, at an expected package cost of $9 billion. That would certainly buy a few water purification plants.