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Adam
Burke and A
nthea Mulakala
DO
NO
RS
AN
D P
EAC
EBU
ILDIN
GPart of the Sri Lanka Strategic Conflict A
ssessment 2005
20
00
– 2
00
5
DONORSANDPEACEBUILDING2000–2005
SIX - PART
SERIES
VO
LU
ME
N.2
0
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DO
NO
RS AN
D PEA
CEBU
ILDIN
GIN
SR
I LAN
KA
20
00
- 20
05
PA
RT
OF T
HE
SR
I LAN
KA
ST
RA
TE
GIC
CO
NFLIC
T A
SS
ES
SM
EN
T 2
00
5
By Adam Burke and Anthea M
ulakala
Th
e govern
men
ts of th
e Neth
erland
s, Sw
eden
, and
the U
nited
Kin
gd
om
, in co
llabo
ration
with
Th
e Asia Fo
un
datio
n an
d th
e Wo
rld B
ank fu
nd
ed th
is pro
ject. Th
e con
tents o
f the stu
dies sh
ou
ldn
ot b
e con
strued
as reflecting
the view
s of th
e five fun
din
g ag
encies.
© C
op
yrigh
t 2005
Neth
erland
s Min
istry of Fo
reign
Affairs
Sw
edish
Intern
ation
al Develo
pm
ent C
oo
peratio
n A
gen
cyT
he A
sia Fou
nd
ation
Govern
men
t of th
e Un
ited K
ing
do
m o
f Great B
ritain an
d N
orth
ern Irelan
dW
orld
Ban
k
For rep
rod
uctio
ns o
f this p
ub
lication
please co
ntact:
3 1/A R
ajakeeya Maw
atha
Co
lom
bo
7, Sri Lan
ka P
ho
ne: +94 11 2698356
Fax: +94 11 2698358w
ww
.asiafou
nd
ation
.org
All rig
hts reserved
Printed
in S
ri Lanka
Contents
Acknowledgem
ents..............................................................................................................................................| 2
About the Authors.................................................................................................................................................| 3
Acronyms...............................................................................................................................................................
| 4
Executive Summ
ary..............................................................................................................................................| 5
Introduction............................................................................................................................................................| 9
1.Aid to Sri Lanka, Past and Present............................................................................................................
| 11Supporting State Developm
ent..................................................................................................................| 11
Greater Sensitivity, More Varied Approaches.........................................................................................
| 11Conditionality in Sri Lanka - Changing the State.....................................................................................
| 12W
orking Outside the State - Different Approaches................................................................................| 12
Growing Donor Aw
areness of Conflict.....................................................................................................| 12
2.Donors and Peacebuilding 2000-2005.......................................................................................................
| 15The W
ar for Peace Period: Increasing Donor Disillusionment............................................................
| 15Donors Get Com
fortable with the UN
P and LTTE...................................................................................| 16
From Center Stage Back to the Sidelines: Donors Face Their Lim
itations........................................| 20
The Tsunami...................................................................................................................................................
| 21
3.Key Trends Em
erging...................................................................................................................................| 23
Broader Development Trends.....................................................................................................................
| 23Sri Lanka Specific Trends - Sum
mary.......................................................................................................
| 24Integrating Conflict Sensitivity....................................................................................................................
| 24Political Aw
areness......................................................................................................................................| 25
Coordination and Long-term Engagem
ent................................................................................................| 28
4.Conclusions....................................................................................................................................................
| 29Overview
.........................................................................................................................................................| 29
Diplomacy, Politics, and Aid........................................................................................................................
| 30Aid as a Catalyst for Change......................................................................................................................
| 30Transform
ative Measures............................................................................................................................
| 30Possible Steps...............................................................................................................................................
| 31
Appendix: A Sample of Developm
ent Actors...................................................................................................| 35
Bibliography...........................................................................................................................................................| 45 1
| Contents
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 2
Acknowledgem
ents
All views expressed in this study are the authors' and do not represent those of the com
missioning agencies,
the facilitators of this study or those who w
ere interviewed. W
e would nevertheless like to thank the follow
ingfor their contributions to this study. Firstly, N
ilan Fernando, Jonathan Goodhand, Bart Klem, Lisa Hedin, and
Sheila Richards who provided feedback on earlier drafts of this report. Secondly, Alan M
artin and GinaGenovese, w
ho provided valuable editorial assistance.
3| A
bout the Authors
About the Authors
Adam Burke
has worked in Sri Lanka regularly since1999. Initially through his role as a social developm
entadviser w
ith the British Department for International Developm
ent (DFID), and then as a consultant to differentorganizations, he has follow
ed the approaches of a wide range of aid actors as Sri Lanka's conflict changed
over time. Fields of engagem
ent include policy analysis, especially on the links between conflict and aid, as
well as design of m
ajor funding programs to support civil society's role in peacebuilding. M
ore widely, he has
worked w
ith donors, United Nations (U.N
.) agencies, and NGOs on developm
ent research, policy, and practiceacross Southeast and South Asia, focusing particularly on conflict-affected environm
ents. Email:
adamitobur@
yahoo.com.
Anthea Mulakala
has worked in the developm
ent field in Canada, the Caribbean and South Asia for over 15years. Her engagem
ent in Sri Lanka extends back to 1991 when she m
anaged a Canadian NGO support
program. Since 2001, she has w
orked for DFID in Sri Lanka as a conflict adviser. She was involved in the
implem
entation of the recomm
endations of the first Strategic Conflict Assessment (SCA1) and has w
orked as acore m
ember of the donor com
munity in Sri Lanka over the past five years. In late 2005 she w
ill begin working
for the World Bank in Indonesia on harm
onizing donor efforts around government decentralization.
Acronyms
ADBAsian Developm
ent BankCFA
Ceasefire Agreement
CPACentre for Policy Alternatives
DACCDevelopm
ent Assistance Coordinating Comm
itteeDFID
U.K. Department for International Developm
entDW
GDonor W
orking Group on the Peace ProcessEU
European UnionFLICT
Facilitating Local Initiatives in Conflict Transformation
GOSLGovernm
ent of Sri LankaGTZ
Deutsche Gesellschaft für Technische Zusamm
enarbeit (German Technical Cooperation)
IFIInternational Financial Institution
JBICJapanese Bank for International Cooperation
JICAJapanese International Cooperation Agency
JVPJanatha Vim
ukthi Peramuna (People's Liberation Front)
LTTELiberation Tigers of Tam
il Eelam (Tam
il Tigers)N
ERFN
orth-East Reconstruction FundN
GON
on Government Organization
ODAOverseas Developm
ent AssistancePA
People's AllianceP-TOM
SPost-Tsunam
i Operational Managem
ent StructureSCA
Strategic Conflict Assessment
SIDASw
edish International Development Agency
SLFPSri Lanka Freedom
PartySLM
M
Sri Lanka Monitoring M
ission TRO
Tamil Rehabilitation Organization
UPFAUnited People's Freedom
AllianceUN
DPUnited N
ations Development Program
me
UNICEF
United Nations Children and Education Fund
UNHCR
United Nations High Com
missioner for Refugees
UNF
United National Front
UNP
United National Party
USAIDUnited States Agency for International Developm
ent
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 4
CHANGIN
G DONOR POSITION
S
This report is a contribution to a broader study entitled
"Aid, Conflict and Peacebuilding in Sri Lanka"
(Goodhand and K
lem, 2005), w
hich examines the peace
process in Sri Lanka with a particular focus on
international engagement.
Donors have provided developm
ent assistance to SriLanka for decades, although its significance in thenational econom
y is decreasing. Severe conflict hasaffected Sri Lanka since the early 1980s, although inm
ore recent years a ceasefire has brought some degree of
peace.
Various donors - especially European bilateralorganizations adopting new
er ideas on aid provisionglobally - have becom
e increasingly sensitive to conflictissues and how
they relate to aid programm
ing. Donors
have more relevant know
ledge, are better able to work
together on conflict, and are better at drawing links
between the conflict and their ow
n financial support.
These shifts reflect first and forem
ost changing politicalcircum
stances in Sri Lanka. They also reflect shifting
patterns of aid provision globally, and a tendency among
some donors to consider the local political or social
contexts as increasingly significant factors in aidallocation, especially in extrem
e conditions such asconflict. Sm
aller donors have shifted more than larger
donors in this direction, although recognition of theim
portance of conflict reduction in achieving the aims
of aid provision is increasing across the board.
A continuing ceasefire in Sri Lanka has made it possible
to assist on the ground, and government m
easures to
promote peace and encourage international involvem
enthave facilitated approaches w
ith a more explicit focus on
peacebuilding. In terms of sensitivity to conflict, the
following donor trends have occurred since 2000:
�M
ore specialist staff dedicated to conflict issues.
�Increased political aw
areness, enabling more
nuanced engagement and understanding of the
linkages between aid program
s and conflict.
�M
ore and increasingly sensitive support for civilsociety.
�Increasing collaboration and shared analysis.
�M
ore support to the conflict-affected North-East
region.
�Increased engagem
ent with the LT
TE.
�Increased aw
areness of conflict issues in mainstream
support.
�Support for governm
ent - LTT
E collaboration.
�Increased attention to "transform
ative" processesthat aim
to tackle underlying problems, especially if
they coincide with an econom
ic reform agenda.
These changes are not a response to a different paradigm
in which donors fundam
entally alter their modes of
engagement--there has been no sea-change. M
ost factorsdeterm
ining the shape of donor assistance remain the
same.
AID'S LIMITED ROLE IN
PEACEBUILDING
The notion that aid provision can in itself act as a
significant catalyst or lever to promote peace in Sri
Lanka may be seductive, but risks overlooking a set of
limiting factors:
Executive Summ
ary
5| Executive S
umm
ary
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 6
�M
ost aid provision is dependent on diplomatic and
political considerations; aid agencies rarely have thescope to act independently, m
eaning that on-the-ground actions are less significant than w
ider trendsor political developm
ents.
�Aid agencies respond to internal incentives andpriorities that are often geared tow
ard ensuringsm
ooth disbursement of aid and efficient allocation
of resources. This m
eans that in many cases,
comm
on ground will be found only w
hen aconflict-aw
are approach eases resource transfers, asopposed to lim
iting expenditures or creatingobstacles in the aid pipeline.
�T
he aid organizations at the forefront ofpeacebuilding approaches are financiallyinsignificant actors in the Sri Lankan econom
y.W
hile this does not render them useless, and there
are many valid exercises that they can engage in,
their approaches will probably not becom
e comm
oncurrency across the aid com
munity in Sri Lanka. A
straightforward look at the w
ays in which the larger
donors work dem
onstrates that while aid can be
made m
ore conflict-aware, there are serious barriers
to a fully cooperative approach.
�M
ost importantly, aid is not, for the m
ost part, veryeffective as a vehicle for transform
ation. It is arelatively m
inor factor in the politics and mechanics
of conflict in Sri Lanka and in most other countries.
This m
eans that while aid can support dom
inanttendencies or political im
peratives, it can rarelychange them
. The viability of aid as a supporting
factor in the peace process depends entirely onprogress in the peace process itself. In m
ost cases,aid is the cart and not the horse.
The drivers of change in Sri Lanka are political actors,
not donors. The international com
munity is not w
ithoutinfluence, how
ever. Donor countries can optim
ize theirm
any types of engagement in Sri Lanka: trade, m
ilitary,security, diplom
acy, and aid. Donors can provide a
variety of incentives and supportive measure for peace,
but these are generally not aid-related.
IMPLICATION
S FOR DONORS' POLICY AN
DPRACTICE
Sri Lanka faces fundamental governance challenges, and
there will be continuing obstacles in the search for
lasting peace. While donors m
ay rarely be able to tacklesuch issues directly, they can still be involvedproductively. D
onors can provide support in the searchfor solutions to underlying problem
s, and help with
more im
mediate issues relating to peacebuilding. Sm
allerdonors m
ay have a comparative advantage in supporting
larger donors to work along these lines in fields w
herethere are shared objectives. O
ur recomm
endationsinclude:
�W
orking toward greater donor understanding of
background conditions and ways in w
hich aidprovision can be screened or evaluated in order to"do no harm
" and be better targeted to supportconditions conducive to peacebuilding. T
his couldinvolve the recruitm
ent of higher-level Sri Lankanstaff. Also there should be further linkages betw
eenaid and diplom
atic, comm
ercial (and, on occasionm
ilitary) ties, to encourage well grounded and
cooperative approaches with a longer-term
perspective.
�C
onsidering withdraw
al carefully: Donors looking
to withdraw
from Sri Lanka should factor into their
calculations the amount they have invested in
building up a conflict-sensitive approach.W
ithdrawal w
ould waste this asset, and for sm
allerdonors it w
ould send no real signal to thegovernm
ent.
�Seeing pragm
atic comm
on ground: Efforts shouldsupport positive aid provision w
here it can backgovernm
ent policy and help produce a tangiblepeace dividend - in the N
orth and in the South. Yetin term
s of donor coordination, donors must
appreciate that consensus-based approaches may
result in lowest-com
mon-denom
inator strategies,and should strive instead to m
ake donor strengthsm
ore complem
entary.
7| Executive S
umm
ary
�Supporting alternative channels for discussion,debate, and negotiation on conflict issues w
ithin SriLanka.
�Focusing m
ore strongly on domestic capacity-
building--whether through projects, funding, or
policy-based research initiatives--that is always
within the fram
ework of a sound institutional
analysis to ensure that any capacity development
initiatives are not constrained by structural factors.
�W
orking to maintain pragm
atic and appropriatecontact w
ith LTT
E bodies.
�C
onsidering the resentment of the lack of attention
to the South, and how to provide w
ays ofaddressing that shortfall. R
apid economic reform
islikely to further derail the peace process, if it helpsbuild perceptions that the poor Southern m
ajority isbeing ignored.
�C
ontinuing to support the North-East even if a
political settlement rem
ains elusive.
�Expanding civil society funding: this is alreadyunderw
ay, but the trend whereby donors look m
orew
idely at a broader range of actors should becontinued.
�Engaging the diaspora: som
e donors have engagedthe diaspora com
munity and m
ore efforts might be
possible.
9| Introduction
Introduction
This report is a contribution to a broader study entitled
"Aid, Conflict and Peacebuilding in Sri Lanka"
(Goodhand and K
lem, 2005), w
hich examines the peace
process in Sri Lanka with a particular focus on
international engagement. It is one of several
contributing studies to the 2005 Sri Lanka StrategicC
onflict Assessment (SC
A2). Part One is a brief
perspective on foreign assistance to Sri Lanka. Part Two
delves more deeply into the period betw
een 2000 and2005 w
hen donors became actively involved in the peace
process. Using the results of interview
s with donors and
other research carried out in early 2005, Part Three
considers the underlying motivations and incentives for
donor action during this time. Part T
hree also examines
the extent to which the analysis and recom
mendations
of an earlier strategic conflict assessment in 2000 have
been implem
ented and are still relevant. Finally itprovides suggestions for future donor engagem
ent.
This report w
as compiled using inform
ation gatheredthrough the authors' professional engagem
ent in SriLanka dating back to 1991. Further interview
s and areview
of literature conducted in February 2005provided updated and m
ore detailed sources. The report
is intended as a background study, alongside otherbackground studies and additional w
ork, to support them
ulti-donor Strategic Conflict Assessm
ent (known as
SCA2) conducted during 2005. T
he authors of thisreport participated in the earlier strategic conflictassessm
ent conducted in 2000, and in theim
plementation of its recom
mendations. As such, this
report presents a particular perspective on conflict in SriLanka, focusing on the role of donor assistance andprovides an "insider" view
of donor engagement w
iththe Sri Lankan peace processes.
This report aim
s to provide useful and succinctinform
ation that can be used for the SCA2, and for
other purposes. All errors, omissions, or inaccuracies are
the fault of the authors.
11| A
id to Sri Lanka, Past and Present
1.Aid to Sri Lanka, Past and Present
SUPPORTING STATE DEVELOPM
ENT
Donor assistance has supported the governm
ent of SriLanka for decades. H
owever, Sri Lanka has never been
heavily dependent on donor resources. In fact, since theeconom
y has grown w
hile donor funding has remained
constant or declined, aid represents a decreasingproportion of the national budget.
Historically, donor funds have supported state-led
development. Transfers to governm
ent for major
projects, or occasionally for generalized budget support,have helped finance health, education, infrastructure,and other services. T
hese steps have enabled Sri Lanka toregister im
pressive improvem
ents in human
development indicators.
The top-dow
n aid delivery model, as practiced in Sri
Lanka during the period imm
ediately following
independence, tended to support an already over-centralized state. Aid w
as provided to the centralgovernm
ent, and negotiations over how funds w
ereallocated occurred at a central level, arguablyunderm
ining democratic processes and reducing
government accountability to Sri Lankan citizens. A state
that can receive funds centrally without having to ensure
the cooperation of citizens, taxpayers, or local politicalinterests m
ay have less need to listen to local opinion.T
he centralized, technocratic "developmental state" that
aid has tended to support in many countries m
ay lackm
echanisms or political processes to ensure just political
representation and a voice for ethnic or other minorities.
While dom
estic factors are more significant than aid
flows in determ
ining the political make-up of Sri Lanka,
donor assistance-supported centralized structures andpolitical system
s marginalize certain groups w
ithin thepopulation. Perhaps the clearest exam
ple is donorsupport for the M
ahaweli basin developm
ent scheme, a
massive integrated developm
ent program for Sri Lanka's
interior that comm
enced in the 1970s. Donor support
made the schem
e viable, but failed to integrate adequatesocial or political sensitivity. Resentm
ent of the unequalaccess to the benefits of such state investm
ents on thepart of m
inority (chiefly Tamil) populations fuelled
support for subsequent civil war.
GREATER SENSITIVITY, M
ORE VARIEDAPPROACHES
In the past two decades, m
any donor organizations havebecom
e more aw
are of the political context within
which aid is provided. From
the early 1970s, forexam
ple, USAID
began to promote decentralization
within its program
s of support in various countries.O
ther bodies, including many European bilateral
donors, U.N
. agencies, and the World Bank, increased
the level of social assessment and specialist staff engaged
in looking at a wider body of issues in Sri Lanka and
elsewhere. Broader aid discourse has prom
oted a wide
range of solutions to perceived problems, including the
promotion of gender equality and popular participation.
Some donors prom
ote such ideas as a priority, ahead ofm
ore traditional development support to a central state.
This is especially the case in a country like Sri Lanka,
where past successes m
ean that mass poverty (as defined
for example in the M
illennium D
evelopment G
oals) haslargely been elim
inated.
Yet newer developm
ent paradigms m
ay also run intoproblem
s, suffering from a lack of locally appropriate
planning, lack of attention to local political factors, or afailure to gain dom
estic participation in proposed plans.N
ewer w
ays of working can sim
ply lead to a new range
of externally driven initiatives.
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 12
More holistic approaches also m
ake disbursement of
large sums of m
oney more challenging. W
hile this is notm
uch of a problem for donors w
hose budgets arelim
ited, it is a real issue for bodies that need to spend ata rapid rate. For developm
ent banks, which need to
provide loans to sovereign governments, there are further
limits on w
hat can be achieved. Loans must flow
tocentral governm
ent, in large quantities.
CONDITION
ALITY IN SRI LAN
KA - CHANGIN
G THESTATE
An awareness that aid alone w
as often ineffective inbringing about econom
ic growth encouraged donors to
attach conditions to their support. This enabled donors
and governments to keep the funding pipeline flow
ing,w
hile attempting to use aid as a lever for reform
s. As inother countries, the strings attached to aid for Sri Lankabecam
e tighter in the 1970s, and starting in 1977, aidw
as used to promote concerted liberalization of the Sri
Lankan economy.
Starting in the late 1980s, donors widened their scope,
recognizing that reform of governm
ent structures was
required as well as econom
ic liberalization. Repeatedefforts have been m
ade to slim dow
n the civil service,im
prove planning and budgetary mechanism
s, andchange the form
or function of a range of linem
inistries. Finally, and most recently, a range of peace
conditionalities has involved a more explicit focus on
conflict-related issues.
Donors have adopted a range of term
s such as"transform
ative approaches," and "building drivers ofchange," to describe efforts to prom
ote reforms of
government structures. In addition to both traditional
projects and conditionality, they have also consideredother w
ays of promoting change by supporting dom
esticconstituencies likely to build pressure for the desiredreform
s, including civil groups, mem
bershiporganizations, m
edia, and research bodies.
WORKIN
G OUTSIDE THE STATE - DIFFERENT
APPROACHES
Aid has increasingly been provided outside government
mechanism
s. In addition to "transformative" support to
promote change, international N
GO
s and a range ofdom
estic bodies have created alternative channels forproviding support in an effort to reach m
arginalizedgroups. Such support m
ay aim to build the voices of
marginalized groups in policy dialogue. A fear of
corruption also encourages donor agencies - especiallythe U
SAID - to avoid funding the governm
ent directly.
Yet for some donors, especially those from
Asia, theprim
e role of the state has not been questioned as it haselsew
here. A host of factors contribute to this, including:greater respect for non-intervention and nationalsovereignty; a desire to avoid foreign interference givenexperiences of colonialism
, external comm
unistagitation, proxy w
ars between superpow
ers, andAm
erican pre-emptive action; positive experiences of
successful state-led development in East and Southeast
Asia; a weaker dem
ocratic tradition and greater respectfor existing ruling elites; and less scrutiny of aid flow
sfrom
civil society domestically. G
iven that Asian donorsare highly significant in Sri Lanka, this is im
portant inconsidering the shape of overall aid flow
s.
GROWIN
G DONOR AW
ARENESS OF CON
FLICT
Through the 1990s, a range of donors becam
e graduallym
ore sensitive to conflict issues. The organizations that
did so tended to be those more w
idely adopting newer
ideas on aid provision. These w
ere chiefly global trends,reflected in program
ming in Sri Lanka and elsew
here. AsSri Lanka em
erged as a middle-incom
e state (accordingto categories used in the W
orld Bank's annual world
development reports and elsew
here), donors who w
ereincreasingly focusing on poverty reduction becam
e lessinterested in disbursing funds to Sri Lanka. Som
ebilateral donors in particular w
ere no longer spendingsubstantial sum
s of money in the country or delivering
large projects through state channels. Consequently, a
13| A
id to Sri Lanka, Past and Present
37%
21%
21%
4% 4% 4%
3%2%
2%2%
JapanAD
BW
orld BankIM
FG
ermany
Norw
ayN
etherlandsKoreaU
SASw
eden
Source: O
ECD
/DA
C
Figure One: Donor flows to Sri Lanka 2002-2003
1.T
hese are gross figures including both loansand grants. T
hey do not include repayments
of loans from the governm
ent of Sri Lanka todonor institutions.
2.Som
e donor contributions do not register inthese statistics (taken from
the OEC
D D
AC).
These donors include: India (sizeable low
-interest loans to G
oSL), China, Saudi Arabia,
Kuw
ait, and other Middle-Eastern
governments.
3.From
the government's perspective, European
and North Am
erican donors are still lesssignificant than the sm
all amounts below
would indicate, given that m
uch of theirsupport is channelled to or through non-governm
ental bodies.
Top Ten Donors of gross O
DA
(2002-3 average in U.S.$)
Japan$249m
ADB
$148m
World Bank
$146m
IMF
$27m
Germ
any$25m
Norw
ay$25m
Netherlands
$24m
Sweden
$19m
Korea
$17m
USA
$16m
good relationship with the governm
ent became less
essential. They w
ere able to focus on the conflict while
still achieving their (reduced) annual aid disbursement
objectives. For some countries, a fairly vocal Tam
ildiaspora w
as another factor drawing donor agencies'
attention to the conflict.
By 2000, some bilateral organizations w
ere alreadyengaged in conflict-related issues as a core aspect of theirw
ork. Other donors, especially the largest three (Japan,
the Asian Developm
ent Bank (ADB), and the W
orldBank), dem
onstrated little recognition of civil war, or
indeed of ethnicity in any respect, in their
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 14
documentation or program
ming. O
ften, it was not in
the interests of some donors, or the governm
ent, torecognize issues that w
ould complicate provision of
substantial funds.
The Strategic C
onflict Assessment of 2000
1(SCA1)
summ
arized the general situation regarding donors in SriLanka as follow
s:
"There are basically three types of aid to Sri Lanka:
(1)C
onventional development assistance channelled
through government, w
ith primary focuses on
structural adjustment, liberalization, governm
entreform
, and infrastructure investment.
(2)H
umanitarian assistance provided to the N
orth-East, m
ost of which com
es out of separate, short-term
humanitarian budget lines and aim
s to addressthe social costs of the conflict.
(3)A num
ber of smaller bilateral donors, such as
Norw
ay, Canada, N
etherlands, and Germ
anyprovide assistance to civil society organizationsfocusing on areas such as hum
an rights, conflictresolution, capacity building, and judicial reform
."(G
oodhand 2000).
The assessm
ent continues:
"Broadly, donors have responded to conflict in threew
ays:
(1)T
he predominant approach has been to w
orkaround conflict i.e., conflict is a disruptive factor tobe avoided. T
herefore donors avoid working in
conflict-affected areas and development aid is put
on hold in the North-East. If a link betw
eenconflict and developm
ent is acknowledged, it is that
conflict which is an im
pediment and can be
removed w
ith greater market openness and
deregulation. The m
ajor donors such as Japan andAD
B have taken this line, both of whom
have
avoided working in the N
orth-East until the "war is
over." Although the World Bank has, in recent
years, begun to invest in the North-East, this has
not affected the main portfolio of program
ssupported in the South, w
hich are still in the main
'conflict blind'.
(2)Agencies w
orking in the North-East have been
forced to become m
ore cognisant of the linksbetw
een their programs and conflict. As a result
they have adapted programs so that they can w
orkm
ore effectively in conflict by reducing conflictrelated risks and ensuring that aid does no harm
.International N
GO
s such as OX
FAM and C
ARE
have analysed their programs in relation to the
conflict dynamics, w
hile UN
HC
R, w
orking inJaffna, has avoided m
aking heavy investments that
may be vulnerable to the ebb and flow
of conflict.
(3)T
here is a small group of bilateral donors w
horecognize the link betw
een development and
conflict and have an explicit focus of working on
conflict. Norw
ay, Canada, N
etherlands, Germ
any,Sw
eden, Switzerland, and the U
.K. have all begun
to identify programm
ing opportunities for working
on conflict. A range of initiatives have been fundedin areas, such as hum
an rights, poverty alleviation,good governance, education and conflict resolution,w
hich have an explicit focus on conflict. While
these initiatives are significant in terms of bringing
new ideas and lessons to the donor-governm
enttable, in relation to the bulk of donor funding theyare relatively sm
all scale and unlikely to affect wider
incentives systems and structures."
1U
nlike this assessment, the earlier S
trategic Conflict A
ssessment undertaken in 2000 w
as not a multi-stakeholder exercise. It w
as a shorter and less
inclusive process, undertaken at a time w
hen military conflict w
as under way. H
owever, it provides a starting point and rem
ains a valid interpretation of
events up to 2000, with a particular focus on donor assistance and conflict.
15| D
onors and Peacebuilding 2000-2005
In the five years following the first Strategic C
onflictAssessm
ent of 2000, the political and institutionalcontexts in Sri Lanka have challenged, tested, and calledinto question the extent to w
hich donors in Sri Lanka caneffectively support peace. T
his section analyses donorattitudes and practices over three defined periods thatcorrespond w
ith shifts in the political environment. It also
considers donor engagement w
ith the Liberation Tigers ofTam
il Eelam (LT
TE) and the im
pact of the tsunami on
the international comm
unity's role. Lastly, it reflects onw
hether donor strategies over this five-year period havebeen effective in strengthening the prospects for peace.
THE WAR FOR PEACE PERIOD: IN
CREASING
DONOR DISILLUSION
MEN
T
As the Sri Lankan economy w
eakened in 2000 and2001, m
ilitary deadlock continued in the North. T
heLT
TE m
anaged to inflict major casualties on the arm
edforces and pursue terrorist tactics in the South. T
hespectacular attack on Sri Lanka's only internationalairport, near C
olombo, m
ade it still more apparent that
winning the w
ar in order to create peace was an
impossible task, and dam
aged the economy w
idely.
Over tim
e, more sm
all bilateral donors began to move
their support away from
the People Alliance (PA)governm
ent. The num
bers of donors joining the leadshow
n by the Netherlands; G
ermany (through the
Germ
an Technical Cooperation, G
TZ
); Canada; and
others in earlier years increased. Many N
GO
s alsoresponded to this shift. For the developm
ent banks andthe International M
onetary Fund (IMF), econom
icstagnation w
as probably the primary basis for som
ew
ithdrawal of support for governm
ent policies in 2000and 2001.
At that time, som
e bilateral donors attempted to raise
attention to the perceived inadvisability of providingdonor funds in an environm
ent where conflict w
as bothcontinuing and apparently dam
aging the economy of
the island as a whole. W
hile some donors w
erecontinuing in an environm
ent of "business as usual,"and argued either that the governm
ent had a right topursue a w
ar against a terrorist non-state actor, or thatw
ithdrawal of support w
ould hardly help the situation,others w
ere aiming to establish greater links betw
eenconflict and developm
ent assistance. A range of studiesw
as supported, including the 2000 Strategic Conflict
Assessment, w
ith this aim in m
ind. Positions became
polarized at times, as w
as seen at the Donor Forum
inParis in D
ecember 2000, w
here some donors w
ereoutspoken on the failure of governm
ent to promote
peace in any meaningful w
ay.
By this point, a range of smaller donors w
as activelyengaged in peacebuilding m
easures as a key aspect oftheir program
s. Larger donors, including the ADB and
the World Bank, w
ere focusing increasingly on linksw
ith conflict in their documentation and in practice
through various channels: programs in the N
orth-East,support for the governm
ent-led Relief, Rehabilitationand Reconciliation (3R
) program, and occasional aim
sto integrate ethnic issues into program
ming in the South
or across the island, such as through the World Bank
education sector reform program
. How
ever, the conflictstill rem
ained a secondary factor in the process ofdeciding on resource transfers from
the development
banks and Japan. Given that these donors represent
some 75-80%
of donor funds, this is significant.
Throughout this period, the PA governm
ent maintained
the position that the conflict was an internal m
atter anddiscouraged unsolicited engagem
ent from the
2.Donors and Peacebuilding 2000-2005
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 16
international comm
unity. Donors w
ere discouragedfrom
proactively working on conflict or expressing
political viewpoints.
DONORS GET COM
FORTABLE WITH THE UN
P AND
LTTE
The U
NP electoral victory over the PA governm
ent inD
ecember 2001 led to a w
holesale change in theenvironm
ent. The new
government signed a ceasefire
agreement w
ith the LTT
E in February 2002, launchedpeace talks soon after, and opened the doors forinternational engagem
ent and support. While the
previous PA government had m
aintained through the1990s that the conflict w
as an internal matter, the U
NP
saw opportunities in internationalizing the peace
process. Norw
ay played the role of the official facilitatorto the peace process and appointed a special envoy.D
uring this period the UN
P negotiated several tradeand security arrangem
ents with strategic partners like the
U.S. and India. Sim
ilarly, donors saw opportunities in
engaging with a governm
ent willing to listen to donor
perspectives and in expressing themselves in w
ays thatdonors or diplom
atic colleagues would find encouraging.
Added to this was the U
NP governm
ent's economic
policy program, w
hich promoted rapid reform
throughliberalization tow
ard a greater role for the free market
and reduced state intervention. For a majority of donors,
this policy portfolio was very close to the prescriptions
that they themselves w
ould have offered.
Peace architecture (such as peace secretariats and thedonor co-chair/conference m
echanism) w
as rapidly putin place and donors eager to play a constructive rolechannelled support tow
ard these bodies. Japan, who had
previously treaded cautiously over political matters,
appointed a special envoy for the peace process andassum
ed the leading co-chair role. Other donors also
appointed special peace envoys and deployed countlessm
issions to launch reconstruction programs in w
hat was
mistakenly perceived as a post-conflict environm
ent.
The C
FA made provision for the N
ordic countries toestablish the Sri Lanka M
onitoring Mission (SLM
M),
which continues its role to the present.
The U
NP encouraged donor coordination and
harmonization during this period, albeit principally
around their economic reform
agenda. A Developm
entAssistance C
oordinating Com
mittee (D
ACC
) was
proposed in 2003 by the government to ensure
government lead on this effort.
Between late 2002 and early 2003, the governm
ent andLT
TE held six rounds of peace talks. T
he government
also pushed forward on developing its econom
ic plan,w
hile the multilateral agencies (IFIs and the U
.N.) led a
needs assessment for reconstruction in the N
orth-East.In parallel w
ith the formal peace talks, international
donor conferences were planned to m
obilize andleverage international support and financing. T
he Oslo
conference in Novem
ber 2002 built on therecom
mendations from
the first two rounds of peace
talks, with donors endorsing the parties' com
mitm
ent tohum
an rights and other core principles; the new joint
government-LT
TE subcom
mittees; and the
establishment of a N
orth-East Reconstruction Fund(N
ERF). Further conferences w
ere planned in co-chaircapitals, leading to the final high profile TokyoC
onference on Reconstruction and Developm
ent of SriLanka in June 2003. T
here, donors were expected to
pledge major funds tow
ard a needs assessment of the
North-East and the governm
ent's economic recovery
plan (called "Regaining Sri Lanka").
Another significant feature of this period was the
international comm
unity's relationship with the LT
TE.
The international com
munity w
as consistent in its supportfor constructive engagem
ent between the governm
ent andthe LT
TE, hoping it w
ould lead to a negotiated politicalsettlem
ent. Regarding their own relationship w
ith theLT
TE, how
ever, donor positions varied. The U
NP
government's encouraging approach to international
engagement w
ith the LTT
E provided space for donors to
cultivate relationships with the Tigers. T
he ADB and the
World Bank took a pragm
atic approach, developinginform
al working arrangem
ents with key LT
TE
counterparts to ensure effective implem
entation of theirlarge-scale reconstruction projects in the N
orth-East. The
LTT
E regarded the international financial institutions(IFI's) apolitical approach favorably because it broughtresources to their areas. It w
as no surprise that the World
Bank was the LT
TE's custodian of choice for the N
ERF.
UN
ICEF courageously attem
pted to tackle more prickly
issues involving vulnerable children and underagerecruits. T
hrough an approach of constructiveengagem
ent and strategic partnership with LT
TE-
sympathetic organizations like the T
RO, U
NIC
EF was
able to get government and LT
TE agreem
ent to anAction Plan for C
hildren Affected by War.
For bilateral donors, engaging with arm
ed non-stateactors presented unfam
iliar terrain. India and the U.S.
took a harder line with the LT
TE, reflecting their ow
nhistory w
ith the organization (in the case of India), ordom
estic policy constraints restricting association with
terrorist organizations since the events of 9/11. Neither
country engaged directly with the LT
TE. T
he U.S. has
consistently insisted that the LTT
E renounce terrorismin "w
ord and deed" before any kind of recognitionw
ould be forthcoming. M
ost other bilateralorganizations adopted the constructive engagem
entapproach, directly and visibly engaging the LT
TE in Sri
Lanka and abroad, providing a sympathetic hearing, and
in some cases (N
orway, Sw
itzerland) providing fundingand support. Even countries that have proscribed theLT
TE as a terrorist organization (the U
.K., Australia,
and Canada) have chosen this approach. T
his "goodcop, bad cop" routine, w
hether by design orcoincidence, kept the pressure on the LT
TE to reform
on fundamental hum
an rights issues, while still
encouraging their political transformation. T
houghapproaches differed, the com
mon interest am
ong donorsw
as to encourage the government and LT
TE to w
orktogether tow
ard a political solution based on power
sharing and federalism.
When access to the N
orth-East improved (repairing of
the A9 road and resumption of com
mercial flights),
donor traffic to the Vanni increased, as did meetings
with the LT
TE. T
he LTT
E expanded its infrastructureto deal w
ith the international comm
unity with the
creation of the Planning and Developm
ent Secretariat, apeace secretariat, and even donor-friendly guesthousesand restaurants.
The donor response follow
ing the ceasefire was in m
anyw
ays remarkable, given the absence of a political
settlement. In som
e respects they treated a no-war, no-
peace environment as though it w
ere a post-conflictsetting. D
onors hoped that peace would create m
oreopportunities for investm
ent and development assistance
in Sri Lanka, leading to a substantial peace dividend.Based on progress in the form
al talks, donors increasedshort-term
(2-3 year) budget allocations in anticipationof the m
ajor reconstruction needs of the North-East.
Though m
any donors were aw
are that in post conflictsituations m
ajor reconstruction spending is generallyrequired for 5 - 10 years after a peace agreem
ent, donorbureaucracies w
ere operating on shorter time fram
es.T
heir enthusiasm to support the peace process (and so
be associated with a peacebuilding success story),
combined w
ith government encouragem
ent, tended toblind donors to the prevailing risks.
Peace negotiations broke down in April 2003. D
espitethis setback in the peace process, the tw
o donorconferences planned for W
ashington (April 2003) andTokyo (June 2003) w
ent ahead as scheduled. As aproscribed organization in the U
.S., the LTT
E was
barred from participating in the W
ashington conference.T
hey withdrew
from the peace talks soon after.
The Tokyo conference w
as well attended: participants
included the Sri Lankan Prime M
inister, the JapanesePrim
e Minister, the N
orwegian Foreign M
inister, theU
.S. Deputy Secretary of State, and the President of the
ADB. T
he LTT
E did not participate however, arguing
that the conference, like the Washington conference,
undermined the basic principle of parity betw
een parties
17| D
onors and Peacebuilding 2000-2005
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 18
in the peace process. $4.5 billion was pledged overall,
20% in the form
of grants and the remaining 80%
asconcessional loans (m
aturity over 30-40 years; most w
itha 10-year grace period; interest rate 1-1.5%
). Adjustedon an annual basis, the $4.5 billion w
orks out to beabout $1.25 billion a year - com
pared to Sri Lanka'snorm
al aid level of around $750 million a year. T
hethree largest pledges cam
e from Japan, the AD
B, and theW
orld Bank, with significant contributions from
othercountries.
The linkage betw
een these funds and the peace processw
as articulated in paragraph 18 of the Tokyo Conference
Declaration (see Figure T
hree below).
The language of the Tokyo D
eclaration struck most
observers as donor conditionality rather than a looserlinkage. T
he former suggests "N
o aid unless peace," while
the latter suggests, "If peace, then increased prospects andopportunities for aid." T
here is a qualitative distinctionbetw
een the two. T
he latter position was the actual
position of most donors w
hile the former w
as theunfortunate m
isinterpretation. The result: confusion and
ambiguity as is evident from
the contradictory views
toward the Tokyo process expressed by individual donors
in Annex 1. How
ever, the government accepted the
conditionality overtones of the declaration, realizing thatthey put m
ore pressure on the LTT
E than thegovernm
ent, and would not im
pede comm
itments to the
government's econom
ic reform strategy. T
he government
was involved in the final drafting of the declaration. T
hegovernm
ent left Tokyo with their pockets full, donors left
Tokyo locked into a declaration that they were ill
prepared to implem
ent. The LT
TE w
ere simply left out
(having chosen not to attend).
For the international comm
unity, the conference processand especially the Tokyo m
eeting were intended to
bolster and support a positive peace process. When the
peace talks went off track in April 2003, the conferences
continued, partly out of their own m
omentum
as planshad been m
ade, but also because donors hoped and feltconfident that talks w
ould resume soon. T
hough stalledtalks w
ere a setback, donors were not prepared to
abandon their support for peace and hoped the Tokyoconference w
ould provide an incentive for parties toresum
e negotiations.
The six m
onths following the Tokyo conference
confirmed the donors' predicam
ent. Peace talks
Figure Two: M
ain pledges made follow
ing Tokyo Conference, 2003 (U.S.$)
�T
hese figures are a guide only, and cover pledges not disbursement. T
hey may not be fully accurate, and are
gross amounts. N
et amounts w
ould have to consider loan repayments as w
ell as pledges that simply repeat
past comm
itments.
�Various donor contributions m
ay not be recorded.
�Sum
s pledged following the tsunam
i of Decem
ber 2004 change the picture considerably.
Top Ten Donors of gross O
DA
(2002-3 average in U.S.$)
Japan$1Billion
ADB
$1Billion
World Bank
$1Billion
EU$293m
USA
$54m
remained on ice, the N
ERF never evolved beyond a
piece of paper, and there was little progress on agreeing
on administrative structures for the N
orth-East. The
ambiguity of the Tokyo D
eclaration led to ad hoc
responses, with som
e donors holding off on theirassistance to the N
orth-East while continuing their
assistance to the government for the South. An extrem
eexam
ple was one donor's delay in financing the
19| D
onors and Peacebuilding 2000-2005
Figure Three: Paragraph 18, Tokyo Declaration
Assistance by the donor comm
unity must be closely linked to substantial and parallel progress in the peace
process towards fulfilm
ent of the objectives agreed upon by the parties in Oslo. T
he Conference encourages the
Governm
ent of Sri Lanka and the LTT
E to enter into discussions as early as possible on a provisionaladm
inistrative structure to manage the reconstruction and developm
ent aspects of the transition process. The
process would need the expeditious developm
ent of a roadmap w
ith clear milestones indicating the path tow
ardsa m
utually acceptable final political solution. With this in view, the international com
munity intends to review
and monitor the progress of the peace process closely, w
ith particular reference to objectives and milestones
including:
a.Full com
pliance with the cease-fire agreem
ent by both parties.
b.Effective delivery m
echanisms relating to developm
ent activity in the NorthEast.
c.Participation of a M
uslim delegation as agreed in the declaration of the fourth session of peace talks in
Thailand
d.Parallel progress tow
ards a final political settlement based on the principles of the O
slo Declaration.
e.Solutions for those displaced due to the arm
ed conflict.
f.Effective prom
otion and protection of the human rights of all people.
g.Effective inclusion of gender equity and equality in the peacebuilding, the conflict transform
ation and thereconstruction process, em
phasizing an equitable representation of wom
en in political fora and at otherdecision-m
aking levels.
h.Im
plementation of effective m
easures in accordance with the U
NIC
EF-supported Action Plan to stopunderage recruitm
ent and to facilitate the release of underage recruits and their rehabilitation andreintegration into society.
i.Rehabilitation of form
er combatants and civilians in the N
orthEast, who have been disabled physically or
psychologically due to the armed conflict.
j.Agreem
ent by the Governm
ent of Sri Lanka and the LTT
E on a phased, balanced, and verifiable de-escalation, de-m
ilitarization and normalization process at an appropriate tim
e in the context of arriving at apolitical settlem
ent.
In relation to monitoring and review
paragraph 20 stated:
"In view of the linkage betw
een donor support and progress in the peace process, the international comm
unityw
ill monitor and review
the progress in the peace process. In implem
enting its own assistance program
mes, the
donor comm
unity intends to take into careful consideration the results of these periodic reviews."
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 20
reconstruction of Kilinochchi hospital because of a lack
of progress on peace. High level m
onitoring visits byspecial peace envoys and co-chair m
eetings offeredstatem
ents that consistently condemned the hum
anrights abuses by the LT
TE and urged both sides to
return to the negotiating table, but had little impact.
Political parties dangled the carrot offered by the Tokyoconference as a w
ay of criticizing each other's approachto the peace process. D
onor confidence began to wane.
FROM CEN
TER STAGE BACK TO THE SIDELINES:
DONORS FACE THEIR LIM
ITATIONS
The elections of April 2004 led to a solid defeat of the
UN
P and a return to a government headed by a U
FPAcoalition (SLFP, JV
P, and others). The defeat
demonstrated the southern polity’s rejection of the U
NP
economic reform
package and their concessions to theLT
TE in order to secure it. To ensure a sufficient
majority, the SLFP form
ed a coalition with the JV
P andJH
U, w
ho had made headw
ay in the elections. These
changes reduced government support for the
internationalized peace process and put donors squarelyback into their pre-2001 box. W
hereas the UN
P
government had w
elcomed donor proposals, including
much of the w
ording of the Tokyo agreement, the new
government w
as less amenable. Aw
are of theinternational com
munity's tilt tow
ard the UN
P, theU
FPA pursued a cooler strategy with donors. In
comm
on with earlier PA-led governm
ents, it resistedefforts by donors to form
comm
on positions andrejected the perceived conditions of the TokyoD
eclaration.
By 2004, the reality of Sri Lanka's fragile andfragm
ented governance structure came to the forefront.
With the JV
P advocating strongly against any federalsolution w
ith the LTT
E; the Karuna-led LT
TE split in
the east; continuing political rivalry between the U
NP
and SLFP; stalled peace talks; and the NER
F finallydeclared dead; donors w
ere left scratching their heads asto how
to direct their efforts at peacebuilding.
In early 2004, heads of mission in Sri Lanka tasked a
donor working group w
ith revisiting the TokyoD
eclaration and developing a strategy for monitoring
progress on peace. The D
onor Working G
roup on thePeace Process (D
WG
) was then form
ed, with w
idespreadrepresentation from
bilateral and multilateral agencies.
Figure Four: Political differences: UNP vs. SLFP
IssueU
NP
SLFP
Donor involvem
entin peace process
Encouraged donor interest,international com
munity at center
stage
Donors at arm
s' length, conflict as internal matter
International advisers within
government
Marginalize those w
ithin international comm
unityw
ho are too outspoken or interfering
Peace AgendaEconom
ic issues as central factor topeace
Political issues as central to peace
Tokyo Declaration
Agreed with declaration; w
ereinvolved in drafting
Rejection of the declaration, but not the promise
of $4.5B
Harm
onizationSom
e efforts on coordination Prefer direct bilateral agreem
ents with individual
donors
The D
WG
adopted an approach that encouraged sharedanalysis, provided regular robust inform
ation forcollective or individual donor assessm
ent, but leftdecisions on aid allocation and conditionality up to thediscretion of individual donors. T
his approach won the
support of a wider range of donors, som
e of who had
felt constrained by the conditionalities of the TokyoD
eclaration. A scenario-planning exercise for donorsw
as held in July 2004 that identified significant factorsaffecting progress on peace in Sri Lanka. T
he factorsw
ent beyond the narrow indicators of the Tokyo
Declaration to include issues such as political
fragmentation, econom
ic growth or decline, and social
and cultural values - all of which had altered the
dynamics of peace over the previous three years.
Interestingly, the international comm
unity--particularlydonors--w
as not identified as a critical factor. A localorganization, C
entre for Policy Alternatives, was hired to
provide quarterly reports analyzing trends against thesecritical factors w
ith the aim of helping donors m
akem
ore informed program
ming and financing decisions.
The first report produced on April 30, 2005 reported
generally that the trend toward peace w
as negative and isconsistent w
ith the findings of SCA2.
THE TSUNAM
I
The w
ave that struck countries bordering the IndianO
cean on Decem
ber 26, 2004 killed some 30,000
people in Sri Lanka, and left a far greater number
homeless. It affected areas along the coast in the N
orth,East, and South, in both governm
ent and LTT
E-controlled areas. In the im
mediate afterm
ath,cooperation betw
een government and LT
TE bodies w
asunprecedented. H
owever, after only a short period, this
initial spirit of cooperation waned and the process of
building a meaningful shared body to support
reconstruction has become entangled in political
bargaining.
The huge flow
s of aid offered to Sri Lanka following the
tsunami have given the governm
ent greater room to
21| D
onors and Peacebuilding 2000-2005
Figure Five: How Donors are Perceived in Sri Lanka: Politics and Popular Opinion
In general, while m
any in Sri Lanka welcom
e donor support, there is also a strong undertow of cynicism
concerning the role and motives of foreign organizations.
Media perceptions: too diverse to sum
marize succinctly, given differences betw
een language groups, etc. The
regular and harsh criticism of donors that w
as comm
on while the conflict w
as in full sway has generally been
more m
uted in recent years, possibly giving donors more room
to operate. How
ever, support for the role ofdonors and international bodies in the peace process dim
inished with the end of the U
NP governm
ent. Populistpoliticians and other interests m
ay use the media to prom
ote independence from perceived foreign interference.
Recent protests against supposed neo-colonialism on the part of the W
orld Bank, following a m
isquote attributedto the country director and cited in the m
edia, show how
donor agencies can form part of populist dom
esticpolitical agendas.
Civil bodies: M
any civil society leaders have views that differ from
the limited num
ber of Colom
bo-based bodiesw
ho broadly supported the "principled" approach to aid delivery emerging from
Tokyo. Non-English speaking
bodies are likely to be more critical of donors, and less supportive of international involvem
ent in the peaceprocess. T
hey are less likely to support approaches based on human rights or other international ideals. O
neim
plication may be that donors need to canvas a w
ider cross-section of opinion, rather than a narrower set of
like-minded institutions.
maneuver and an opportunity to press ahead w
ith itsplans. Som
e donors feel that it reduces still further thescope to prom
ote the principles outlined in Tokyo.T
here was now
a willingness to provide support am
ongdonors w
ho had previously been reluctant to do so,given the lack of adherence to Tokyo "principles." Forexam
ple, the U.K
. offered to pay a proportion of SriLanka's debts to m
ultilateral institutions following the
tsunami, in a gesture that is likely to am
ount toconsiderably m
ore than the U.K
.'s annual bilateral aidbudget for the country.
Prior to the tsunami, m
ost donors felt that they hadlim
ited influence in Sri Lanka. With the influx of
enormous sum
s of unconditional tsunami relief and
reconstruction funds and the added bonus of debt relief,Sri Lanka (and especially the governm
ent) is awash w
ithm
oney and the power these funds bring. Any
opportunity the international comm
unity had to exertleverage through these funds in support of conflictresolution or peacebuilding principles has beeneffectively m
issed. Furthermore, the stronger positions
that some donors w
ere pondering prior to the tsunami
may prove m
ore difficult to pursue in the presentcontext.
One aspect of the international com
munity's role in the
situation has been to advocate balance, equity, andconflict sensitivity, particularly since there is an overlapbetw
een conflict-affected areas and tsunami-affected
areas. A set of guiding principles for tsunami response,
developed collaboratively with governm
ent, civil society,and donors, provides a com
mon fram
ework around
which donors can harm
onize their efforts.
One significant positive outcom
e of the tsunami disaster
is the establishment of the Post-Tsunam
i Operational
Managem
ent Structure (P-TOM
S), a mechanism
thatallow
s representatives from the governm
ent, LTT
E, andthe M
uslim com
munity to decide jointly on priorities
for post-tsunami reconstruction in the affected areas of
the North-East. It is supported by a m
ulti-donor trustfund. T
he successful signing of the P-TOM
S was
somew
hat of a surprise for donors who rem
ember the
endless negotiations over NER
F that ultimately failed.
Though a practical m
echanism for tsunam
ireconstruction, the international com
munity recognizes
that the P-TOM
S is one of the few positive indicators of
progress on peace in recent times. If it successfully
proceeds from agreem
ent to implem
entation (always a
challenge in Sri Lanka), it may provide an opportunity
for dispirited donors to re-engage in the peace process.H
owever, donors m
ust be careful to heed the lessons oftheir previously overzealous enthusiasm
over the peaceprocess and not jum
p into the driver's seat. The P-
TOM
S provides a long awaited vehicle, but as
experience and history suggest, the road to success will
be rocky.
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 22
This section builds on the findings of research carried
out by the authors in early 2005. Based on keyinform
ant interviews, unpublished donor and N
GO
reports, group discussions, and personal experience, theauthors appraise how
donors are engaging inpeacebuilding. In spite of the fluctuations in the politicaldynam
ics in Sri Lanka and the resulting changes indonor behavior, there have been som
e consistent trendsin donor practice during the five-year period since theinitial strategic conflict assessm
ent.
BROADER DEVELOPMEN
T TRENDS
Donor policies tow
ard Sri Lanka have generally beendriven by international interests and agendas as m
uch as,or m
ore than, by the needs and concerns of the countryitself. As a relatively sm
all country to which donors
dedicate few in-country staff, this tendency is even m
orepronounced than in a larger state such as Indonesia orBangladesh, w
here large aid offices have beenestablished, and national dialogue is m
ore dominant.
Donor Bureaucracies
Each donor body works differently. Each has its ow
nspecific procedures, m
odes of providing aid, priorities,and decision-m
aking processes; and the motivations of
individuals working in donor institutions tend to be
based more around internal incentive structures than the
external working environm
ent in the country ofoperation. For the larger donors, a key im
perativeinvolves ensuring a strong "pipeline" of aid projects thatdisburses m
oney smoothly and effectively according to
set policy. Factors influencing this policy vary, butgenerally depend on:
�Political involvem
ent from the governm
ent of thedonor agency (or from
dominant nations in the case
of multilateral agencies); this is influenced by
broader relations with the recipient governm
ent,including historical legacies, voices of the recipientcountry diaspora in donor nations, trading interests,and geo-strategic objectives;
�Technical approaches favored by in-housespecialists, consultants, etc.;
�T
he practicalities of transferring significant levels ofresources and an incentive to ensure sm
ooth flows
of aid. For lending institutions, the imperative is to
provide large, reliable, and easily transferablegovernm
ent loans.
Global Policies Im
plemented Locally
Donor organizations m
ay be informed by technical staff
on the ground, but policymaking is rarely a bottom
-upprocess. C
ooperative in-country efforts (such as theD
onor Working G
roup in Sri Lanka) can have asignificant im
pact on local working practices, but is
unlikely to affect the over-riding policy-based priorities ofm
ost donors. In Sri Lanka, the factors influencing most
donors' policies are largely driven by agency-specificim
peratives and agendas. Categorization of Sri Lanka as a
middle-incom
e country and one likely to achieve theM
illennium D
evelopment G
oals places it as a lower
priority country for some bilateral donors w
ho have acom
mitm
ent to the poorest countries. This, and the lack
of progress toward peace, has led to the possible departure
or scaling back of some sm
aller donor programs.
Outcom
es of 9/11
The events of 9/11 have affected developm
ent policiesby placing increased em
phasis on issues of globalsecurity and counter-terrorism
. This has had an im
pacton the w
ay some donors engage w
ith the LTT
E. It has
23| K
ey Trends Emerging
3.Key Trends Em
erging
also led to the creation of special reconstruction andstabilization program
s and units within som
e donorcountries (e.g., the U
.S. and the U.K
.) that focus onfailed and fragile states. Even before 9/11, donor staffand academ
ic consultants who focus on conflicts w
ereattracted to Sri Lanka as a potentially successfulexperim
ent in liberal peacebuilding.
Increased Emphasis on C
oordination and Harm
onization
This affects m
ostly EU donors. It m
eans people havem
ore desire to spend time and attention focusing on
working together. T
he irony of this development is that
while it represents a global trend in donor "best
practices," it is resisted by the Sri Lankan government.
SRI LANKA-SPECIFIC TREN
DS-SUMM
ARY
The 2000 assessm
ent suggests that: "Aid is only one of anum
ber of instruments that can be applied to support
such a process and, in relation to diplomatic
interventions, it may be a rather blunt instrum
ent with
limited leverage. T
herefore, aid may com
plement
political processes happening on the ground, but it isunlikely to be a leading edge in a peacebuilding process.U
ltimately, these questions have to be addressed by
political and civil actors within Sri Lanka m
akingdecisions about their definitions of peace, social justiceand future developm
ent" (p. 105). This is a reflection
that is still valid today.
The assessm
ent goes on to state that "conflict blind"developm
ent is a problem: "Aid can follow
the faultlines of conflict and inadvertently increase political,econom
ic, and social exclusion." It then proposes fourfields of engagem
ent:
�Integration of conflict sensitivity
�A politically inform
ed approach
�C
omprehensive and coordinated strategy
�Long-term
strategic engagement
To summ
arize the responses of donors over the last fiveyears in these fields: w
here changes in Sri Lanka anddonor policy shifts have enabled greater engagem
ent inconflict related issues, there has been som
e progress.O
verall, aid provision to Sri Lanka has become m
oreconflict-sensitive since the SC
A of 2000. With the
changing domestic and international dialogue
concerning Sri Lanka, donors are now far m
ore able tow
ork on conflict-related issues. In practical terms, the
continuing ceasefire makes it possible to assist on the
ground. But these changes are not indicative of aparadigm
shift in which donors have fundam
entallyaltered their m
ethods of engagement: there has been no
sea change. Most factors determ
ining the substance ofdonor assistance rem
ain the same.
INTEGRATIN
G CONFLICT SEN
SITIVITY
Many donors have m
ade considerable progressregarding this issue. Som
e bilateral agencies have doneso to such an extent that peacebuilding is their m
ainpriority. U
.N. agencies such as U
NIC
EF have alsoengaged productively in the N
orth-East and on conflictissues m
ore widely, in step w
ith a global move tow
ardrecognizing child rights as an overarching priority. Forothers, the response has been m
ore instrumental-an
increasing awareness that conflict needs to be taken into
account and that it has a real impact on projects and
programs. T
his is a positive if more lim
ited change.
Aid has not generally targeted the fundamental or
underlying problems that generated conflict in the first
place. How
ever, as a result of increasing analytical work,
donors are more aw
are of the underlying causes anddrivers of conflict. Although a "transform
ative"approach to tackling background conditions has notgained m
uch ground, this enhanced understanding hasprovided for som
e useful interventions. Whether these
have made an im
pact on the ground is a matter of
interest, although concerted evaluation is beyond thescope of this study.
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 24
Large donors like the ADB and Japan now
considerissues of equity in m
onitoring and appraisal of projects.T
his is a departure from earlier practices. O
ther smaller
donors try to align all of their assistance aroundpeacebuilding priorities.
Some donors - the AD
B, the U.K
., and Switzerland for
example - have created new
posts. This m
akes aconsiderable difference in their ability to engage in issueson the ground, and to generate com
mon positions. It
may also have an im
pact on diplomatic initiatives, as
specialist staff might im
prove institutional knowledge
and understanding of the complexities of the conflict.
More Support to the N
orth-East
Although the frozen peace talks mean that no interim
authority has emerged, m
any donors have found ways of
working in the N
orth-East. These m
ethods generallybuild on existing m
echanisms, w
ith donors operatingeither through international N
GO
s, U.N
. agencies, orgovernm
ent departments. Recognizing the role played by
the LTT
E and its partners in the North-East, m
ost donorsoperating in these areas have found creative and effectivem
eans of ensuring LTT
E cooperation and consultation.
POLITICAL AWAREN
ESS
Engaging with the peace process has im
proved donors'know
ledge both of the dynamics of the conflict and of
shorter-term political im
peratives. Specialist staff,cooperative efforts, and learning exercises such as thescenario planning process of 2004 have increasedknow
ledge and understanding across a wider range of
actors. Whereas in 2000, the num
ber of engaged donorstaff that understood the political dynam
ics of conflictin Sri Lanka w
as limited, a greater num
ber of informed
actors are now engaged. C
loser links with som
e civilsociety bodies has also helped, although there is stillroom
for improvem
ent in that area.
How
ever, this increased awareness is lim
ited. The larger
donors may not see political issues as relevant, or m
ay seethem
as fields that an external actor has no right to engagein. For the larger donors, objectives are broadly the sam
eas before: econom
ic growth and poverty reduction. M
anyw
ould not share the sentiments of the 2000 analysis w
henit states that donors should use aid to leverage dom
esticpolitical shifts so that background conditions areaddressed. T
here has been some instrum
ental engagement
where conflict issues are perceived to have the potential to
damage the realization of other objectives, but this is not
25| K
ey Trends Emerging
Figure Six: North East Housing Reconstruction Program
me
NEH
RP
(North East H
ousing Reconstruction Program
me)is a G
oSL/World Bank project aim
ing to provideconflict-affected fam
ilies with im
proved and affordable housing units. It will entail a cash grant paid in four
installments to vulnerable fam
ilies to help reconstruct their houses. In addition, the technical assistance providedunder this program
will help m
eet the long-term housing needs in the N
orth-East through improved
construction standards, strengthened housing finance options, enhanced private sector involvement in housing
construction, and streamlined m
echanisms to resolve property disputes.
Northeast C
oastal Com
munity D
evelopment Project:T
his ADB project, approved in m
id-Decem
ber 2004, is a$26 m
illion, four-year loan targeting three eastern districts. Under a standard poverty/vulnerability index, Tam
ilpopulations w
ould have emerged as the principle beneficiaries (given their status as the poorest groups). In order
to avoid an allocation that might have led to tension, given the lack of inclusion of other ethnic groups, the
vulnerability index was am
ended to address diversity issues. Subsequent re-design allowed for support to other
(chiefly Muslim
) groups, with the m
ajority of funds still going to the poorest comm
unities.
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 26
too different from "w
orking around the conflict," asdescribed in the 2000 analysis.
Donor support for econom
ic liberalization may
demonstrate a long-standing lack of political
understanding. Given the patronage-based structures of Sri
Lankan political systems, a rapid liberalization program
ischallenging - it attacks vested interests and underm
inesgrassroots support. W
hile many m
ay agree that Sri Lankaneeds reform
s, the sequencing of these reforms is a careful
political balancing act. Some argue that donor prom
otionof rapid change under the U
NP governm
ent undermined
grassroots support for the peace process. While a peace
dividend was prom
ised, the reality for many in the South
was rising prices as subsidies w
ere removed. G
iven thatpopular southern support is essential for the peace process,this m
ay have been short-sighted. Indeed, the numbers of
votes won by the JV
P and still more extrem
ist Sinhalagroups in the South in the 2001 election effectively dealt am
assive blow to the peace process.
More and Increasingly Sensitive Support for C
ivil Society
A range of donors support civil bodies working on
conflict related issues. Various donors have made a
conscious effort to move beyond support for an elite
group of NG
Os in C
olombo, and find indigenous
bodies that might be able to build a m
ore generalgroundsw
ell of support for peace. The U
.K., G
ermany,
the U.S., U
.N. bodies, and various other donors are
engaged in this work. T
he World Bank has also done
some exploration in this area. In som
e places -Sw
itzerland for example - civil groups w
ithin thediaspora com
munity are also involved. Yet som
e feel thatcivil society support in general still tends to be carriedout clum
sily, reaching just a few high profile groups.
Increased Engagement w
ith the LTT
E
Donors have a range of positions on w
orking with the
LTT
E or other groups, and support for development
actions is carefully appraised. Organizations have,
Figure Seven: Civil Society Support
FLICT: Facilitating Local Initiatives in C
onflict Transformation is a joint G
TZ
(Germ
any) and DFID
(U.K
.)financed project. T
he overall goal is to strengthen - through a countrywide approach - incentives for conflict
transformation in Sri Lanka by encouraging and supporting civil society to play a m
ore effective and influentialrole in contributing tow
ard a lasting and positive peace. FLICT
expects to achieve this through local initiativesand strengthening organizations' capacities.
The FLIC
T project concentrates its efforts on different focus areas:
Media and inform
ation transfer for building peace
Strengthening democratic space in the N
orth-East
Policy reforms and their im
plementation for a pluralistic society
Other focus areas are linked to longer-term
issues. Crucial issues are the support of "good local governance,"
"multi-ethnic tow
ns as focal points for integration," "a positive role of youth," "academia's role in the peace
process," and "conflict transformation by different organizations in civil society."
The im
plementation of FLIC
T started in 2003 and should be seen as a process. T
hroughout the duration of theproject, FLIC
T w
ill develop a network of partners-strengthening and engaging a body of interm
ediaries with local
initiatives in the medium
and long term. FLIC
T also includes authorities and private sector organizations in its w
ork.
however, found a variety of w
ays to bring internationalexperience to the LT
TE and other bodies in the N
orth-East, w
ith the aim of presenting peaceful and hum
anrights-based exam
ples. Many of these initiatives have
been politically sensitive, and have involved concerteddiplom
atic rather than technical donor attention. The
mainly European donors have pursued an approach of
"constructive engagement" w
ith the LTT
E that hasprovided opportunities for regular dialogue on programand policy issues. T
hese steps are controversial and it istoo soon to judge overall im
pact, but it is unlikely thatdisengagem
ent would have a m
ore positive impact on
welfare or peacebuilding. Aid program
s may provide
valuable diplomatic support w
hen carefully applied with
open support from all sides. T
he ADB and the W
orldBank take a m
ore pragmatic approach to relations w
iththe LT
TE. Because IFI projects bring valuable resources
and development to the N
orth-East and LTT
Ecooperation is necessary for sm
ooth implem
entation,both the banks and the LT
TE recognize the im
portanceof a consultative relationship.
Support for GoSL-LT
TE C
ollaboration
While donors have steered clear of involvem
ent in thesubstance of direct negotiations betw
een the GoSL and
LTT
E, they have sought to support and encouragepractical collaboration betw
een the parties at other levelsaround particular issues or developm
ent programs. T
hem
ost recent example is the P-TO
MS. International
support, patience, and strategically targeted assistancew
ill be critical for the success of P-TOM
S. The
international comm
unity will have observer status
within the P-TO
MS structure. T
he mechanism
alsoprovides an opportunity for donors to support capacitydevelopm
ent and collaboration among key actors around
essential service provision. This could lead to positive
development and political outcom
es.
Some Increased Attention to "Transform
ative" Processes
Some donors feel that m
ainstream developm
ent supportto the governm
ent of Sri Lanka should be used to
promote fundam
ental governance changes. The aim
ofthis is to change the structures and political system
s thatform
part of the background of the conflict: a sense ofinjustice at the perceived unequal treatm
ent of them
inority population. Skewed resource allocation,
language, and education policy, etc., will arguably not
disappear until there is pronounced institutional change.Additionally, a sustainable peace m
ay hinge upondecentralization processes, given the need to find som
eform
of local power-sharing structure. H
owever, w
hilesom
e donors maintain such aim
s, others - especially thelargest three donors (Japan, the AD
B, and the World
Bank) - do not build the bulk of their support aroundthem
. Given the financial dom
inance of these three, thegreater part of donor assistance to Sri Lanka is notdesigned to prom
ote such changes. There is som
eevidence of change, how
ever, as donors like the ADB
and the World Bank try to w
ork more closely w
ithprovincial and local adm
inistrations, particularly in theN
orth-East. Though financing is still agreed upon and
managed w
ith the central authorities, there is increasingrecognition am
ong the IFIs that effectiveim
plementation requires governance reform
s.
Risk-taking
A desire to support a peace process has increased therange of high-risk and potentially high-exposureinitiatives. W
hereas donors preferred to keep a lowprofile in the past, m
ore recently they have on occasionresponded quickly to the peace process, driven by theincentive to contribute to, and be associated w
ith, apotentially successful outcom
e.
The donor harm
onization that seemed possible during
the UN
P government m
ay have given individual donorsthe confidence to take risks, know
ing that their policiesw
ould be supported or shared by other agencies. AnSLFP governm
ent, which discourages harm
onizationand is m
ore sensitive about donor actions, may restrict
risk-taking behavior.
27| K
ey Trends Emerging
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 28
COORDINATION
AND LON
G-TERM EN
GAGEMEN
T
There have been im
provements in coordination. T
heseare in som
e cases limited to the sam
e range of small
European donors, but not entirely so. Generally, donor
collaboration and information sharing in Sri Lanka have
improved greatly in the past five years. T
hese effortsrelate both to a m
ore explicit acceptance by donors toaddress conflict issues as part of their core business andalso to international directives around aid effectivenessand harm
onization. Some benefits include joint w
orkbetw
een multilaterals (the U
.N., the AD
B, and theW
orld Bank) and bilaterals (GT
Z, the N
etherlands, andD
FID) on selected projects, and the com
mon positions
developed in Tokyo in 2003. Joint planning exerciseshave also helped im
prove the general intelligence of thedonor com
munity. D
onors collaborate on comm
onpositions to take w
ith GoSL and LT
TE, engage in
shared analytical exercises such as SCA2, and
increasingly co-finance peacebuilding support. Examples
include the UN
ICEF Action Plan (see boxes). T
heW
orld Bank has also established a donor coordinationtrust fund that supports activities such as this SC
A, asw
ell as other harmonization initiatives w
ith government.
The 2000 SC
A comm
ents: "The crux of the problem
isthat short-term
thinking, short-term m
andates, andshort-term
funding are being used to confrontentrenched and long-term
problems and needs." T
his isstill predom
inantly the case. While donor analytical
work has contributed to a m
ore widespread acceptance
of the long-term nature of peacebuilding efforts in Sri
Lanka, in practice, donor timefram
es are still driven byshort-term
cycles of planning and financing. The
expected departure of some bilateral agencies exacerbates
the situation. It is noticeable that the agencies able tow
ork effectively in the North-East have tended to be
those with a long track record of engagem
ent. One
could argue that perhaps donors have aimed too high in
targeting their assistance. Given the slow
pace ofprogress on peace in Sri Lanka, resources geared to thepolitical-peace agenda are high risk and unlikely to bedisbursed according to donor tim
eframes. M
orepragm
atic targeting of assistance over a longer timefram
em
ay be a better option.
Figure Eight: UNICEF and Com
mon Planning
UN
ICEF launched a com
mon approach to address the needs of vulnerable children in the N
orth-East through anAction Plan for C
hildren Affected by War, agreed to by the LT
TE and the governm
ent in late 2000/early 2001.T
he suspension of peace talks halted comm
on work, but U
NIC
EF managed to secure signatures of both sides
nonetheless. How
ever, suspension of talks meant that there w
as no mechanism
for discussing or solving arisingproblem
s. UN
ICEF pioneered approaches that prom
oted interchange between the tw
o sides, and managed to
broker the only human rights agreem
ent. UN
ICEF still practices "shuttle dialogue." T
here is still space throughprovincial structures for interchange betw
een the two sides, on education policy for exam
ple, but work on som
eof the key issues, notably on child soldiers, has been hard going.
OVERVIEW
In Sri Lanka, donors have shifted in approach since2000. D
onors are far more aw
are of conflict-relatedissues, m
ore able to work together on conflict, and
better at drawing links betw
een the conflict and theirow
n financial support. Disagreem
ents persist overw
hether aid can be a lever for peacebuilding.
Donor policies have varied, partly in response to
changing political circumstances in Sri Lanka and partly
because of shifting patterns of aid provision globally.Sm
aller donors have shifted more than larger donors,
although recognition of the centrality of conflict to aidprovision and the need to consider the links areincreasing across the board.
Although every donor is different, there are three broadcategories of donors that em
erge from an analysis of aid
in Sri Lanka: 1) the "big three" of Japan, the ADB, and
the World Bank; 2) the U
.S.; 3) most of the rest,
consisting chiefly of European bilateral donors. Agenciesnot included in these groups are aligned som
ewhere
close to these actors, with the U
.N. agencies and
Western donors tending tow
ard the Europeanperspective, and Asian donors tending tow
ard the "bigthree" position. T
here are, of course, many shades of
subtlety and contradiction within this crude description,
which should not be used to im
ply that the situation ispolarized: all donors have m
uch in comm
on with each
other, especially given the massive aid flow
s arriving forsupport and reconstruction follow
ing the tsunami of
Decem
ber 2004.
Put simply, the European tendency is to attem
pt to useaid directly to prom
ote and support peacebuilding in arange of w
ays. Meanw
hile, the "big three" tendency is toconsider conflict as an im
portant, but not overriding,
issue, with aid disbursem
ent and economic reform
ascentral concerns. T
he U.S. position involves broader
security dimensions, w
hich lead it to take a tougherconditional stance w
ith the LTT
E. These dynam
ics havenot changed significantly since the previous conflictassessm
ent in 2000.
While the "big three" could have better integrated
conflict as a central concern within their program
s ofsupport, sm
aller "European" donors could perhaps haveacted at tim
es with m
ore understanding of the realitiesof aid provision. T
he notion that aid provision can act asa significant catalyst or lever to prom
ote peace in SriLanka is interesting, but perhaps overlooks a set oflim
iting factors:
�M
ost aid provision is dependent on diplomatic and
political considerations; aid agencies rarely have thescope to act independently, m
eaning that on-the-ground actions are less significant than w
ider trendsor political developm
ents. While m
any bilateral aidagencies do link effectively w
ith diplomatic
structures, this is not a universal rule. And for allagencies, aid is provided for a range of reasons.
�Aid agencies respond to internal incentives andpriorities that are often geared tow
ard ensuringsm
ooth disbursement of aid and efficient allocation
of resources. This m
eans that in many cases,
comm
on ground will be found only w
hen aconflict-aw
are approach eases resource transfers, asopposed to lim
iting expenditures or creatingobstacles in the aid pipeline.
�T
he aid organizations at the forefront ofpeacebuilding approaches are financiallyinsignificant actors in the Sri Lankan econom
y.W
hile this does not render them useless, and there
are many valid exercises that they can engage in,
their approaches will probably not becom
e comm
on
29| C
onclusions
4.Conclusions
currency across the aid comm
unity in Sri Lanka. Astraightforw
ard look at the ways in w
hich the largerdonors w
ork demonstrates that w
hile aid can bem
ade more conflict-aw
are, there are serious barriersto a fully cooperative approach.
�M
ost importantly, aid is not, for the m
ost part, veryeffective as a vehicle for transform
ation. It is arelatively m
inor issue in the politics and mechanics
of conflict in Sri Lanka and in most other countries.
This m
eans that while aid can support dom
inanttendencies or political im
peratives, it can rarelychange them
. The viability of aid as a supporting
factor to the peace process depends entirely onprogress in the peace process itself. In m
ost cases,aid is the cart and not the horse.
DIPLOMACY, POLITICS, AN
D AID
An increased political awareness on the part of aid actors
has enabled more nuanced engagem
ent andunderstanding of the linkages betw
een aid programs and
conflict. Better informed experts have ensured that a
range of aid agencies aims to w
ork more intelligently.
Recent experience links prospects for peace with
prospects for greater donor involvement.
These donors recognize the pragm
atic reality of aidprovision as a political act, and have aim
ed to useassistance for valuable ends. Political engagem
ent with
aid flows is not alw
ays beneficial, however. A close
alliance of aid donors with the previous U
NP-led
government m
ay have made it harder to engage w
ith thecurrent governm
ent. While understanding political
realities of aid provision and Sri Lanka, aid agenciesneed to take a long-term
view. While political aw
arenessis im
portant and linkages between aid and a range of
other international issues may be pragm
atically valuable,a long-term
approach is needed. This m
eans betteranalyzing and understanding the difference betw
een thestructures and dynam
ics of the conflict in Sri Lanka andrealizing that a positive change in the dynam
ics may not
necessarily lead to much needed structural change.
AID AS A CATALYST FOR CHANGE
In the aftermath of the Tokyo D
eclaration, donors havecom
e to the general consensus that while aid can benefit
peace, it cannot be used as a lever or catalyst for peace.If this is the only positive outcom
e of the Tokyo process,then it w
as an experience well endured. Aid is not a
blunt instrument that can be used to drive peace. T
hedrivers of change in Sri Lanka are political actors, notdonors. W
hile political actors have used aid as a lever intheir ow
n political interests, donors must not m
istakethis clever m
anipulation for influence. This is not to say
that the international comm
unity is without influence.
Donor countries m
ust optimize the m
any types ofengagem
ent that they bring to Sri Lanka: trade, military,
security, diplomacy, and aid. D
onors can provide avariety of incentives and supportive m
easures for peace,but these are generally not aid related.
TRANSFORM
ATIVE MEASURES
Donor involvem
ent in studying peace and conflict in SriLanka has led to increased aw
areness among som
edonors of m
any of Sri Lanka's deep-seated problems in
terms of political structures, social fabric, and cultural
trends. Many of the proposed solutions to these
problems - decentralization, political reform
, multi-
ethnic representation, etc. - have weak or contested
domestic purchase and appear at present unlikely to
make m
uch headway. T
he key issue - politicalm
arginalization of minority groups - is not likely to be
tackled in the near future. This has led to a degree of
despondency on the part of some donors.
Donor involvem
ent in peacebuilding can createexpectations of rapid change. Post-conflict environm
entsoften create scope for structural adaptations that w
ouldnot otherw
ise be possible. Recent examples include East
Timor and C
ambodia. A less extrem
e case would be
Indonesia following the fall of Suharto, creating scope
for reform including decentralization and
democratization. H
owever, there is no such state of flux
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 30
in Sri Lanka. While the dynam
ics of conflict over thepast five years have been fluid, the underlying structuresrem
ain largely intact. Political, economic, or social
change is consequently less feasible; radicaltransform
ations are unlikely given the stability andcontinuity across the South.
It is rare for donor agencies to have the capacity tosuccessfully challenge dom
estic political or socialobstacles. Indeed, it is rare for donors to be as aw
are ofthese problem
s as many of them
are in Sri Lanka. While
international support can help in myriad w
ays, thesolutions to such difficulties are likely to be foundinternally.
Some donors are still trying to support "transform
ative"approaches. But the only field w
here the major donors
are aiming to do so in a com
mitted w
ay is in economic
reform. W
hile there is some discussion and open analysis
of the underlying factors behind the conflict, large aidbureaucracies tend to prom
ote technocratic solutionssupportive of governm
ent policies similar to those used
across the globe. General aw
areness of such issues isfairly lim
ited, and incentives are generally against actionto address underlying political or social problem
s. There
are no quick wins.
How
ever, there are nuances within this picture. Som
em
ajor loans deal fairly sensitively with on-the-ground
problems and w
ith background inequalities or the scopefor transform
ative measures. T
here is the potential tofind w
ays of engaging on these issues, and to encouragegovernm
ent and LTT
E support for such efforts to builda m
ore responsive, multi-ethnic state. At the very least,
projects should reflect awareness of the breakdow
n ofpotential beneficiaries along ethnic lines.
POSSIBLE STEPS
Sri Lanka faces fundamental governance challenges that
are intractable in the short term, such that there w
ill becontinuing obstacles in the search for lasting peace.
While donors m
ay rarely be able to tackle such issuesdirectly, they can still be involved productively. D
onorscan support the search for solutions to underlyingproblem
s, and help with m
ore imm
ediate problems
related to peacebuilding. Examples of potentially fruitful
engagement already exist. W
hile this background studydoes not have the scope to evaluate specific program
s,and it is in any case very challenging to draw
linkagesbetw
een cause and effect, some com
ments and proposals
follow:
Better Analysis
�Factoring in the influence of geopolitical factors onthe key actors in Sri Lanka. T
his suggests a betterunderstanding of the role of India and even C
hina inregional political and econom
ic affairs. Aid donorsshould pursue a m
ore inclusive approach with these
key actors.
�W
orking toward greater donor understanding of
background conditions and the ways that aid
provision can be screened or evaluated in order to "dono harm
" and be better targeted to do some good.
Cooperative efforts am
ong donors can contribute tothis aim
, but should not be an overriding objective.
�Building better understanding of Sri Lankan politics,society, and econom
ics within donor bodies, especially
through the recruitment of higher-level Sri Lankan
staff.
�Building alternative channels for discussion, debate,and negotiation on conflict issues w
ithin Sri Lanka.U
se analysis--of the political economy, the conflict,
and the institutional environment--both as a vehicle
for donors to work together and to inform
programm
ing choices.
Types of Aid
�Focusing m
ore on domestic capacity building,
whether through projects, funding, or policy-based
research initiatives, (but always w
ithin the framew
orkof a sound institutional analysis) to ensure that any
31| C
onclusions
capacity development initiatives are not constrained
by structural factors. An imm
ediate opportunity iscapacity building through the P-TO
MS, enabling
local governance actors to manage tsunam
ireconstruction.
�W
orking to maintain contact w
ith LTT
E bodies,pragm
atically and appropriately. This varies betw
eendonors - no one solution is right.
�C
onsidering the resentment at the lack of attention to
the South, and how to address that shortfall. Rapid
economic reform
is likely to further derail the peaceprocess if it helps build perceptions that the poorsouthern m
ajority is being ignored.
�C
ontinuing to support the North-East. O
vercoming
the challenges posed by interim authorities and
decentralized structures would be desirable, but it m
aybe a long tim
e coming. In the interim
, there areproven m
ethods of engagement that all sides are
content with. G
iven that such engagement can
promote conditions for peace by opening up the
North-East to national and international expertise,
efforts should continue to strengthen interdependencyand prom
ote an array of local bodies. Smaller donors
with m
ore sensitivity to local level issues may be able
to partner with larger funders in order to assist in
sensitive programm
ing in the North-East.
�Expanding civil society funding: this is already underw
ay, but donors should continue to look more w
idelyat a broader range of actors.
�Engaging the diaspora: som
e donors have engaged thediaspora com
munity in efforts to increase
understanding and reduce support for extremism
. It isnot clear w
hether this has succeeded, but continuedefforts m
ight be helpful.
Harm
onization, Coordination, C
omplem
entarity
�Pragm
atic comm
on ground: finding areas where
there is both government interest in pushing through
reforms and large donor interest in pursuing w
orkthat w
ill support peacebuilding (e.g. promoting
spending in the North-East, rather than criticizing
spending in the South); supporting positive aidprovision w
here it will help produce a tangible peace
dividend - in the North and in the South.
�C
ontinued linkage between aid and diplom
atic (oron occasion m
ilitary) ties, to encourage groundedand cooperative approaches, but w
ith a longer-termperspective. C
apitalize on the complem
entary roles ofdevelopm
ent, political, and military departm
ents. Forexam
ple, political or diplomatic leverage m
ay bem
ore effective than aid in influencing nationalpolicies.
�D
onors thinking about withdraw
ing from Sri Lanka
should consider the amount they have invested in
building up a conflict-sensitive approach. Withdraw
alw
ould waste this asset, and for sm
aller donors--giventhe lim
ited amounts involved as a percentage of aid
flows--w
ould send no real signal to government. A
more conflict sensitive approach m
ay be to shift gearsrather than exit. T
his would entail less em
phasis onan assertive policy-influencing role w
ith key politicalactors, and increased em
phasis on working w
ithothers to tackle background conditions, address thesocial costs of conflict, and build constituencies forpeace. Increased joint efforts, secondm
ents and silentpartnerships could reduce transaction costs forsm
aller bilateral donors without the potentially
negative impacts of pursuing a total exit strategy.
�Recognize the differences betw
een individual donorsand groups of donors. Appreciate that consensus-based approaches m
ay result in lowest com
mon
denominator strategies. Strive for better
complem
entarity of donor strengths, incentives andresources. T
he "good cop, bad cop" strategy with the
LTT
E is one example of how
donors have used theirdifferent positions to engage w
ith the LTT
E without
comprom
ising principles. Bilateral partners shouldalso think beyond the "aid basket" w
hen consideringw
hat they can contribute to Sri Lanka.
The ability to im
plement such w
ork depends onm
aintaining good relations with all sides. W
ithin the
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 32
context of a "do no harm" approach, there does seem
tobe scope for engaging in a variety of w
ays. None w
illbring about a radical shift in short-term
peacebuildingor longer term
background conditions, but such anim
pact is probably in any case unrealistic. Smaller,
helpful steps are still possible and should form a part of
donor assistance. Smaller donors m
ay have acom
parative advantage in supporting larger donors,w
here there is comm
on ground, to work along these
lines.
The past five years have reaffirm
ed the validity of therecom
mendations of SC
A1. Despite dynam
ic swings in
the peace process, structurally the underpinnings of theSri Lanka conflict have not transform
ed dramatically. In
their desire to support peace, donors must continue to
recognize that any significant shift will be internally and
not externally driven. While developm
ent aid may
provide a means for supporting this shift w
hen ithappens, it w
ill not be the catalyst for it.
33| C
onclusions
The follow
ing section covers some of the actors involved
in development assistance to Sri Lanka. It is not a
complete list, and only provides som
e information, since
there is insufficient space for a more com
prehensiveassessm
ent. Some donors are not covered sim
ply for lackof tim
e. With each actor, points are divided into som
eor all of these sub-headings: program
s/policies;perspectives on aid and conflict; perspectives on donors,Tokyo, and subsequent com
mon indicators; tsunam
i;com
ments.
GOVERNM
ENT PEACE SECRETARIAT
Perspectives on Aid and Conflict
�Recognizes that m
ilitary solution is nonviable. Butm
aintains austere line on LTT
E as a terrorist body.
�India is em
erging as a significant donor as well as a
diplomatic force. T
here is recognition that differentdonors have different approaches.
�G
overnment is strongly prom
oting unifiedsolutions, integrating econom
ies in the North and
South, and promoting investm
ent andinterdependence.
�H
opes tsunami w
ill still lead to comm
onim
plementation m
echanisms.
�N
ational Council for Econom
ic Developm
entincludes sub-com
mittees that donors can be
involved in. North East D
onor Coordinattion
Cluster (one subcom
mittee) deals w
ith North-East.
�In term
s of donors support to transform structures,
there should be scope to make som
e progress.Projects can be m
ore innovative in terms of
connecting different parts of the country. Forexam
ple, the Mahaw
eli Project should have helpedthe N
orth. There should be opportunities in certain
areas to help with reform
s.
�Feels that donors should have few
er "legitimizing"
linkages with LT
TE; such linkages have "absolutely
no impact on LT
TE's transgressions." D
onors needto distance them
selves more from
them and refuse
to approach TRO
; instead, they should work
through mainstream
government structures in
which the LT
TE can continue to practice in and
engage with; recognition that, in practice,
government agents are very close to LT
TE in
Kilinochchi and M
ullaitivu.
Views on Donors
�Strong opposition to com
mon donor positions.
More com
fortable with standard individual donor
projects than with pooled funds, in the N
orth-Eastor elsew
here. Welcom
es support to the North-East,
through channels that have been proven to work
including NG
O or U
.N. delivery, as w
ell as use ofgovernm
ent structures. Does not prom
ote"transform
ative" approaches in the South, althoughthere m
ay be scope in selected fields.
Tokyo and Subsequent Comm
on Indicators
�Strong perception that benchm
arks are "totallyinappropriate, arbitrary, and artificial." G
lad theydid not hold.
LTTE PEACE SECRETARIAT
Perspectives on Aid and Conflict
�Encouraged by efforts on the part of the W
orldBank and the AD
B to work in the N
orth-East.
�Breaks dow
n donors as follows: EU
bilaterals, India,C
hina, Japan, and the USA. India, Japan, and
35| A
ppendix
Appendix: A Sample of Developm
ent Actors
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 36
China collectively represent over 80%
of fundsprom
ised. Multilateral banks are also im
portant.Recognizes that EU
bilaterals are not overlysignificant financially, but developm
ent of comm
onpositions has a useful im
pact - especially given theEU
's role as co-chair.
�T
he LTT
E are content with the different w
ays thatdonors can provide support. T
he U.S., for exam
ple,can w
ork through NG
Os, keeping aw
areness ofagreed guiding principles; Japan has been asked bythe LT
TE to ensure equitable allocation of funds
along ethnic/religious lines in all of its programs.
�W
ith India, low-interest loans to the governm
entare provided: it is not certain that any expectationsof equity are placed on the loans.
�W
ith China, planned investm
ent in 16 harbors will
need to address ethnic issues.
�D
onor forums and com
mon donor positions are
welcom
ed; but in reality are less significant thanindividual aspirations of key players.
Tokyo and Subsequent Comm
on Indicators
�G
enerally supportive of what is term
ed "EU" donor
position (referring to comm
on positions taken by arange of bilaterals). At one level, expresses supportfor principle fram
eworks, donor coordination
efforts, and wider application of international
human rights law, and sees the governm
ent as tryingto avoid these EU
principles. Yet at another level, isresistant to such "foreign interference."
Views on Donors
�M
ore supportive of all donors than might be
expected. Appears to send mixed m
essages about thevalue of "principled" approaches advocated by m
anybilaterals. Is w
illing to consider a variety ofm
echanisms to support developm
ent in the North-
East; this means that the political deadlock on an
interim authority does not necessarily need to hold
up development assistance to the N
orth-East. While
welcom
ing engagement in international best
practices, also holds a strong line on maintaining
control, whether contested dom
estically orchallenged by international bodies such as donors.
Comm
ents
�W
ith current alignments, the LT
TE m
ay feel it hasm
ore to gain from a W
estern international stance on"principles" than the current governm
ent (incontrast w
ith the situation under the previous UN
Pgovernm
ent). This m
ay make it challenging for
Western donors to secure the governm
entcooperation necessary for successful interventions.
JAPAN
Programs/policies
�H
as been the largest donor to Sri Lanka for many
years. Bulk of funding through JBIC (concessional
loans); considerable amounts also through JIC
A(technical cooperation grants).
�Traditionally strong relationship w
ith thegovernm
ent, in Sri Lanka and elsewhere. Aid
priorities are set through internal discussions andconsultations w
ith the government; engages in a
process of "anticipatory bargaining," or discussionsw
ith government to determ
ine aid flows along
comm
only agreed objectives. Subsequent need todisburse and coordinate the spending of m
anyloans, w
hich is quite time consum
ing.
�Supportive of continuing ceasefire; regards aid flow
sas im
portant to maintain support for a peace
process. States that if there were a return to w
ar,they w
ould reconsider the value of support. Butcurrently, still w
ishes to support a process thatcontinues to hold, despite recent lack of progress.
�W
orks in the North-East, often through U
.N.
programs. In the N
orth-East especially, theycarefully exam
ine equity and distribution of aidalong ethnic-religious lines as an im
portant part of
project appraisal. This is a change from
the situationpre-ceasefire, w
hen such issues were not considered.
This change reflects aw
areness of the need to reducetension. It is clearly stated by Japan at the 2003Tokyo m
eeting that: "the 'peace dividend' should beevenly distributed, taking into account the balancebetw
een the north-eastern part and the southernpart of the country, and the equally sensitivebalance betw
een Sinhalese, Tamils, and M
uslims."
�Japan has less experience of integratingtransform
ative issues (i.e., promotion of
fundamental governance changes relating to
peacebuilding) into aid support. This is of potential
interest but not a basis of current projectform
ulation or policy.
Conflict Sensitive Approach
�Japan provides m
ore support to the North-East,
often through U.N
. programs. Japan aim
s tocarefully exam
ine equity and distribution of aidalong ethnic-religious lines as an im
portant part ofproject appraisal. T
his is a change from the situation
pre-ceasefire, when such issues w
ere not significantlyconsidered.
Tokyo and Subsequent Comm
on Indicators
�Role in political peace process: facilitated the 2003Tokyo m
eeting, further quarterly monitoring visits
from senior envoy.
�Participation in D
WG
and Tokyo Declaration w
asreluctant; accepts loose principles but not afram
ework or set of restrictions on aid provision.
Paragraph 18 of the Tokyo Declaration should be
seen as positive efforts to encourage a goodbackground environm
ent for the peace process,rather than conditionality of any kind. Efforts touse background principles to form
ulate guidelinesleading to indicators w
ill not work effectively and
are not welcom
ed. Simple principles for engagem
entare w
elcomed, how
ever.
�D
oes not support processes that might lead to
conditionality and associated stipulations: View
sthese as unnecessary and unw
elcome.
Comm
ents
�T
he Japanese approach, along with that of m
ajorconstituencies w
ithin multilateral banks (and m
ostsignificantly w
ithin Sri Lanka), does not perceivesocietal transform
ation as a role for aid. Suchconcepts are m
ore prevalent with W
estern donorsand civil society than elsew
here; additionally, suchchange is regarded by m
any as counterproductiveconditionality or external W
estern impositions on
domestic structures. M
ore practically, ideas oftransform
ation through more nuanced aid provision
limit disbursem
ent capacity and slow dow
n projectcycle m
anagement.
�T
he Japanese development m
odel is different fromcontem
porary Western approaches: strong em
phasison state-led developm
ent with capitalist econom
y,but also w
ith heavy investment in hum
andevelopm
ent, infrastructure, and other redistributivem
easures such as land reform, as appropriate. T
his isnot alw
ays compatible w
ith approaches that placefar greater stress on hum
an rights, participation,political change, and im
proved governance ratherthan top-dow
n support.
ASIAN DEVELOPM
ENT BAN
K
Programs/policies
�T
he aim to support Sri Lanka by disbursing funds
in a timely fashion, board m
embers that are broadly
supportive of government in the first instance, and
an approach that prioritizes economic or
engineering-based solutions, means that
peacebuilding issues do not fall naturally into theAD
B's line of work. H
owever, the AD
B has a strongrecord of offering support rapidly in post-conflictenvironm
ents. In Sri Lanka, it has been able tow
ork increasingly in the North-East; follow
ing the
37| A
ppendix
CFA, the AD
B rapidly offered support and soughtpractical w
ays of providing assistance in the North-
East.
�Inform
ally, conflict understanding/awareness is
growing, as w
ell as an awareness of the links
between project success and m
aintaining peace bothin C
olombo and the head office in M
anila. There is
increasing attention to equity and ethnicity relatedissues, w
ith growing focus on ethnic balance and
transparency as a key aspect of poverty analysis. The
ADB has also been able to w
ork increasingly in theN
orth-East following the C
easefire Agreement. A
conflict specialist, seconded from a bilateral, w
orksin the C
olombo Resident M
ission
�T
he Northeast C
oastal Com
munity D
evelopment
Project, approved in mid-D
ecember 2004, is a $26
million, four-year loan targeting three Eastern
provinces. Under a standard poverty/vulnerability
index, Tamil populations w
ould have emerged as
the principle beneficiaries (given their status as thepoorest groups). In order to avoid an allocation thatm
ight have led to tension given the lack ofinclusion of other ethnic groups, the vulnerabilityindex w
as amended to address diversity issues.
Subsequent redesign allowed for support to other
(chiefly Muslim
) groups, with the m
ajority of fundsstill going to the poorest com
munities.
�N
ECO
RD
- an earlier project now being extended -
also aims to track ethnicity issues in m
onitoring andevaluation.
Comm
on Indicators
�O
verall disbursement and project approval is not
linked to progress toward peace. But projects do
have a phrase comm
enting that disbursement could
be linked to the peace process.
Tsunami
�T
he tsunami has led to a large allocation of nearly
$150 million dollars. T
he ADB conflict specialist
(on secondment from
a bilateral) has been asked tolook at conflict-related aspects of the loan.
USA (USAID)
Programs/Policies
�T
hrough their democracy, governance and conflict
programs, the U
.S. is involved in a range ofinitiatives. Follow
ing three "tracks" of the process-political, diplom
atic, and aid approaches: Track One
through co-chair mechanism
; Track Two through
engaging in parallel political/civil society processes;Track T
hree through support for civil initiatives.
�Involved in a range of initiatives: "O
ne Textinitiative" to bring second-tier political players intodiscussions; local governm
ent support through The
Asia Foundation; people's forums in a range of
locations; annual peace perception surveys, etc.
�Future initiatives: Possible direct support (throughU
.S. NG
Os) to enhance political party aw
areness ofpeacebuilding issues; possible w
ork with civil bodies
like trade unions, etc.; possible work on youth and
civic education.
�T
he U.S. has: 1) a clear understanding of the
political challenges involved, 2) awareness of the
need for transformative approaches and governance-
related issues in the South, and 3) the organizationalcapacity to engage accordingly.
�Aw
areness of a range of second-order conflicts thatcould arise in future years: com
plexities of Muslim
political engagement and issues of attacks on
Christian churches in the South.
Perspectives on Aid and Conflict
�T
here is a perception that major donors have at
least adopted conflict awareness rhetoric, and have
some understanding of the need to look carefully at
equitable distribution of resources. But there is lessdirect acknow
ledgement of governance-related issues
that form the basis of the reasons for conflict.
Tsunami
�Post-tsunam
i reconstruction support is unlikely tobe conflict-sensitive and, in any case, governm
ent
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 38
can select from a w
ide range of donors if objectionsare raised. Flow
of reconstruction funds is likely toexacerbate "patronage" netw
orks that are notequitable and could w
ell enhance tensions.
Comm
ent
�T
here is programm
atic support for multiple actors
engaging with a range of issues, generally through
civil society bodies of different descriptions. But thisis tem
pered by recognition of the LTT
E as aterrorist body, and a global environm
ent thatencourages support for governm
ent rather thannon-state actors.
SWEDEN
(Sida)
Programs/Policies
�Sida has been w
orking in Sri Lanka since 1958.
�Integration of conflict into program
ming began in
earnest in 1998. Prior to that, there were program
sin conflict areas, and peacebuilding w
as a focus ofsom
e NG
O/civil society support, but it did not
occupy the central position of the country strategythat it now
has.
�Sw
eden has had, and continues to have, bilateraldevelopm
ent cooperation agreements w
ith thegovernm
ent for over 20 years.
�Since 1998 there has been a tw
o-pronged approachto Sida support: 1) Peace, D
emocracy, and H
uman
Rights and 2) Pro-poor econom
ic development.
�T
he embassy in C
olombo is fully delegated w
ith acountry plan, annually approved by the AsiaD
epartment. T
he embassy has the right to steer
funds and enter into agreements w
ith the GoSL and
civil society organizations in keeping with the
country plan.
�T
he internal Local Project Appraisal Com
mittee
ensures the quality of projects/ programs/sector
support and also ensures that cross cutting issuessuch as dem
ocratic governance, conflict sensitivity,
gender equality, HIV
/AIDS, and environm
entalconcerns are m
ainstreamed.
Comm
on Indicators
�Sida subscribes to paragraph 18 of the TokyoD
eclaration. The clauses are interpreted as "If peace,
then increased prospects and opportunities for aid,"rather than as "N
o aid unless peace."
�Sida has been an active prom
oter and participant ofthe D
onor Working G
roup in the efforts by donorsto find com
mon indicators in m
onitoring the peaceprocess and supporting developm
ent in Sri Lanka.
�Sida supports harm
onization and alignment of
support together with the IFIs and like-m
indeddonors. Sida prefers sector cooperation reflectedthrough core funding and increased harm
onization,even in peace and tsunam
i related interventions (forexam
ple: core support to UN
ICEF's C
ountry Plan;the AD
B on infrastructure development - especially
roads in conflict and tsunami affected areas; the
World Bank on their Education Sector
Developm
ent Credit in the area of social cohesion;
and, together with the N
etherlands Embassy and
Danish D
evelopment C
ooperation, support to thePeace and D
evelopment Fund m
anaged by CH
A).
Conflict Sensitivity
�C
onflict is viewed in a broader light than m
erely theethnic conflict in the country, and is inclusive of allpotential conflicts (for exam
ple, religious conflictand buffer zone issues). H
ence, Sida activelyprom
otes a "do no harm" approach.
�C
onflict sensitivity is essential, but should also bebalanced in support to the N
orth-East and South.
UNICEF
Programs/policies
�U
NIC
EF has been working in the N
orth-East for along tim
e.
39| A
ppendix
�A 2002 D
FID/SID
A evaluation recomm
ended thata m
ore integrated managem
ent structure provide auniform
countrywide approach. T
his enabled work
with sim
ilar government structures island-w
ide,reducing the am
ount of NG
O engagem
ent.
�T
his reorganization and the ceasefire enabledU
NIC
EF to engage in policy issues relating tochildren. O
riginally through an Action Plan forC
hildren, agreed to by the LTT
E and GoSL in late
2002/early 2003, a comm
on approach was
launched. The suspension of peace talks suspended
comm
on working, but U
NIC
EF managed to secure
signatures of both sides. How
ever, suspension oftalks m
eant that there was no m
echanism for
discussing or solving arising problems.
�U
NIC
EF pioneered approaches that promoted
interchange between the tw
o sides and managed to
broker the only human rights agreem
ent. UN
ICEF
still practices "shuttle dialogue." There is still space
through provincial structures for interchangebetw
een the two sides, on education policy, for
example; but w
ork on some key issues, notably on
child soldiers, has been hard going.
Comm
on Indicators
�Benchm
arks on progress toward peace as an
incentive. These have not been put into practice;
the only funds that have been withheld have been as
a result of economic, not peace-related, issues.
Perspectives on Aid
�In the N
orth-East, there are still options forengagem
ent. These options have involved
interchange with all parties for decades, and can
continue in this manner. D
onors can work in the
North-East if they w
ish - there are mechanism
s.
�W
ithout peace talks, and more recently w
ith theLT
TE split in the East, the likelihood of concerted
demobilization is slim
. This has an im
pact on issuessuch as child soldiers - a key topic, given senior
U.N
. involvement and allegations of m
ajortransgressions of agreem
ents.
UNDP
Programs/policies
�Institutional change: U
ND
P has shiftedconsiderably in last 3-4 years. Previously, traditionaldevelopm
ent issues rather than conflict were seen as
the key priority among m
ost staff mem
bers in theSri Lanka office. N
ow, staff are prioritizing a more
conflict-aware and engaged approach. N
ewer staff
are often conflict-focused, leading to more capacity
to engage. This reflects a global shift in U
ND
Pthinking as w
ell as changes in the Sri Lanka office.
�T
he intergovernmental role of U
ND
P does createlim
its on actions, especially with the current
government. Support tends to have to flow
throughthe governm
ent, but that does not rule out some
valuable work. T
hey have to navigate carefully andw
ork quietly; they do not have scope to take onbroad agendas, nor the m
andate to engage theLT
TE as an equal partner. O
thers - for example,
GT
Z - can w
ork more flexibly. M
ore widely,
UN
DP is open to a w
ider range of civil society,governm
ent, and other bodies than they were in the
past.
�Peace Secretariat: Supported peace secretariats onboth sides of the conflict. Also linked M
uslims into
the process, before the establishment of a M
uslimsecretariat. T
his was a slow
process, but perseveranceled to som
e success.
�O
ther work includes sm
all grants through peacesecretariats, including grants to non-Tam
il localbodies in the N
orth-East. This is regarded as a
successful, if small, effort to prom
ote democratic
process and pluralism in the N
orth.
�Process: the U
.N., after the C
FA, was involved in
early needs assessments. T
he UN
P government
requested U.N
. involvement in the social and
economic aspects of peacebuilding and
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 40
reconstruction. After the CFA, the U
ND
P was
involved with the prim
e minister's office unit in
efforts to take forward reconciliation/reconstruction.
This w
as unrolled in local government offices (at
the district level, etc.) as well as centrally, and folded
into the 3Rs m
inistry with the change of
government. T
he UN
DP has been responsible for
the "human developm
ent" aspects of comm
onassessm
ents, including gender, local capacitybuilding, etc.
Comm
on Indicators
�Indicators stem
ming from
principles are of mixed
value. They can be beneficial as an exercise for som
ebilateral organizations; but as a w
ider exercise, itdoes not have enough leverage or ow
nership.
GERMAN
Y (GTZ)
Programs/policies
�G
TZ
programs: as w
ith many other bilaterals,
conflict transformation justifies G
TZ
presence in anotherw
ise middle-incom
e nation. Programs link
with conflict across the board.
�Econom
ic promotion w
ork through micro-finance
and vocational training/regional economic
promotion: em
ploys "do no harm" principles.
�Projects in conflict areas: has m
aintained a presencefor som
e time, engaging w
ith all stakeholders - isnow
trying to build capacity by increasing itsoutsourcing. Involves higher-level, on-the-groundengagem
ent.
�Projects on conflict transform
ation: support to theBerghof Foundation’s w
ork, FLICT
civil societyprogram
, and the Education for Social Cohesion
program.
�Aid-diplom
acy linkages more com
plex for Germ
anythan m
any countries, given GT
Z's independent
status as well as m
inisterial divide between aid
operations and diplomatic operations.
Comm
on Indicators
�Post-Tokyo developm
ent of principles is seen bym
any observers as conditionality.
�Aid has not becom
e part of a wider process.
�A "transform
ative" approach to address underlyingproblem
s and set up pluralistic representativestructures on all sides along the lines of theprinciples agreed to in Tokyo has not beenprom
oted by either side, or by the major donors.
�Scenario planning exercise of 2004: aim
ing toansw
er questions of what peace w
ould look like,w
hat principles would be viable, and w
hat are thedrivers of peace. C
oncluded that bilaterals are lessinfluential than thought.
Perspectives on Aid
�D
onors have had increasing dialogue with all sides,
but with different routes and m
otivations. Yet thereare still open doors to w
orking collaboratively with
larger donors.
�T
he LTT
E, as well as the governm
ent, is unwilling
to comprom
ise on anything that bridges a gapbetw
een aid and political issues.
�"Regaining Sri Lanka" docum
ent: very close toprevious U
NP governm
ent policy.
�D
onor meetings: good coordination, but high costs.
Perceived by others as self-interested. It could bereplaced w
ith more direct engagem
ent between Sri
Lankan bodies and donors.
�M
ore domestic capacity building w
ithin projectsw
ould help by questioning the conventional projectdelivery m
odel and finding alternative working
methods.
Tsunami
�Tsunam
i needs assessments, lessons of previous
assessments of how
to work in the N
orth-East etc.,have not been taken fully into account.
41| A
ppendix
SWITZERLAN
D
Programs/policies
�Sw
itzerland has no real development program
.Previously, they had only a sm
all program w
ithsom
e school reconstruction in Jaffna. Since 2002,they have been involved in study tours by theLT
TE, G
oSL, parliamentarians, and the m
edia tostudy federalism
in Switzerland.
�Sw
itzerland has had a new post as Adviser for
Peacebuilding since 2003, who focuses on hum
ansecurity, peacebuilding, and hum
an rights.
�T
he Swiss provide support to the Berghof
Foundation for peacebuilding related work. Support
also was provided to the "O
ne Text Initiative,"along w
ith USAID
.
�Sw
itzerland has regular contact with the LT
TE. T
heTam
il expatriate comm
unity in Switzerland is quite
prominent. T
he Swiss are conducting w
ork with the
diaspora in Switzerland and encouraging insight
into Sri Lankan affairs through stimulating debates
and exchanges.
�T
he concern that aid flows m
ight spoil the peaceprocess is w
idely held.
Comm
on Indicators
�Scenario planning: C
lingendael facilitated a processthat developed 20 issues m
ost relevant to theconflict.
�A like-m
inded approach can lead to joint statements
that produce a comm
on diplomatic stance of
strength. There is a com
mon desire to ensure even-
handedness, and an intelligent donor response ispositive. C
onditionality: valid on issues of human
rights - for example, child soldiers.
Tsunami
�Since the tsunam
i there has been a major Sw
issD
evelopment C
ooperation presence.
U.K. (DFID)
Programs/policies
�Like m
any other bilaterals, conflict is the main
justification for engagement in Sri Lanka, given
their middle-incom
e status. There is som
e pressureto keep a presence given the large Sri Lankancom
munity in the U
.K., but overall there is little
desire to disburse, and therefore only a small
program of support. Pressure to spend is also
reduced by hands-off managem
ent, includingpassing funds to other bodies for use - U
.N.
agencies (UN
ICEF, U
NH
CR
), other donors (forexam
ple, GT
Z on civil society support), and N
GO
s(O
xfam, Save the C
hildren).
�T
he Sri Lanka aid program has undergone m
ajorchanges from
the late 1990s to 2005. It is nowfocused entirely on peacebuilding and governancepriorities. T
he diplomatic position has also shifted,
as peacebuilding receives enhanced priority in SriLanka and around the w
orld. The aid program
'sfocus on peacebuilding m
ay have both beeninfluenced by and contributed to this shift.
�C
hanging internal capacities has enabledengagem
ent: Like various other bilaterals in SriLanka, dedicated peacebuilding staff has enabled aprogram
to develop around peacebuilding issues.
�G
lobally, a stronger and more integrated
conflict/humanitarian section in London has
increased capacity to provide policy and practicalsupport; better linkages betw
een the U.K
.governm
ent departments also exist. G
CPP - the
Global C
onflict Prevention Pool - is one basis ofinterdepartm
ental cooperation. It has enabled abetter collective approach. It is thought that thisapproach has w
orked better in Sri Lanka thananyw
here else where it has been im
plemented by
the U.K
. government.
�Restructuring of Assistance: T
here are plans torestructure U
.K. provision of support to
peacebuilding within Sri Lanka over the next year.
This w
ill involve replacing a distinct DFID
presence
Donors and Peacebuilding in S
ri Lanka 2000 - 2005 | 42
with an enhanced joint political and developm
entsection dedicated to peacebuilding.
Comm
on Indicators
�D
FID has never advocated conditionality as a
means of supporting peace. It did encourage efforts
to support the negotiating parties in achieving theiragreed principles. D
FID encourages com
mon
approaches, trying to gain support for comm
onapproaches from
other, larger donors. They also
support a range of partnerships includingsecondm
ents, support to trust funds, etc. As with
other European bilaterals, prioritization of donorcoordination has led to such approaches in SriLanka.
�T
his prioritization of donor partnerships may reduce
involvement of Sri Lankan institutions in program
s.T
his covers staffing, capacity building, etc.
�D
FID encourages shared analysis and joint
approaches among donors w
here possible.
NETHERLAN
DS
Programs/policies
�Joint diplom
atic and aid operations.
�C
onflict has been firmly on the D
utch aid agendasince the early-m
id 1990s.
�Involvem
ent of the Clingendael Institute for m
anyyears has provided analysis on conflict in Sri Lanka.
�M
ore recently, the Dutch have prom
oted jointw
orking processes.
�T
he Dutch are planning to w
ithdraw from
SriLanka. C
urrent program of support totals
approximately Euros 10m
. The funds are earm
arkedfor environm
ental work w
ith GoSL and the AD
B,peacebuilding w
ith civil society, the Consortium
ofH
umanitarian Agencies, and the N
ECO
RD
(ADB)
project. There is also som
e work w
ith chambers of
comm
erce.
�A presence in the N
orth-East, through NG
Os or
otherwise, gradually results in shifting attitudes in
some areas.
Comm
on Indicators
�Principled approach also cam
e from the elite
intellectual Colom
bo-based Sri Lankan civil society,not just donors.
�Principles based on Paragraphs 17 and 18 of theTokyo D
eclaration were not m
eant to beconditional; they w
ere intended as a politicaldeclaration. H
owever, the perception of
conditionality stuck and was not countered.
�T
he comm
on assessment being planned by C
PAw
ith donor funding should provide a basis fordonors to use at w
ill.
�D
onor working groups are very tim
e-intensive.
43| A
ppendix
Goodhand, J. (2001) Aid, C
onflict, and Peacebuilding in Sri Lanka,The C
onflict, Security and Developm
ent Group,
London.
Goodhand, J., K
lem B., et al. "Aid, C
onflict, and Peacebuilding in Sri Lanka, 2000-2005." A report prepared for thegovernm
ents of the Netherlands, Sw
eden and the U.K
., The Asia Foundation, and the W
orld Bank.
45| B
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inning photographs by Annuruddha Lokuhapuarachchi,D
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marasinghe
Adam
Burke and A
nthea Mulakala
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