During the Cold War, when US foreign policy was aimed at defeating communism, the US Agency for International Development, under the guidance of the State Department, served as the pivotal channel to spread foreign aid while also supporting the goal of containing communism.
The Marshall Plan revived war-torn western Europe after World War II. In the 1950s and 1960s, the deluge of US foreign aid to Taiwan was conducive to Taiwan's subsequent economic take-off, renowned US scholar Alice H. Amsden once argued.
Conventional wisdom argues that official foreign aid has been a useful instrument of foreign policy in economic and political terms, although humanitarian and developmental concerns do play an important role.
Taiwan is no exception. Taiwan's foreign aid effort has been organized around its foreign policy goals of sustaining ties with its limited allies or to lure interested countries to come into Taipei's fold, officials admit.
But some critics have regarded Taiwan's foreign aid practices as "pouring money down a rat hole," because the recipient countries, the majority of which are less-developed states, generally lack the social and political base that would enable them to use the aid effectively. Others target the decision-making process, saying related programs were decided through the deliberations of a small group of people.
Amid requests to move toward greater transparency and accountability in Taiwan's foreign aid practices, the executive branch submitted a related bill called the international cooperation and development law (
But dissatisfaction with the bill, which was mainly drafted by the foreign ministry, drove another related bill known as the foreign assistance law (
The foreign assistance law, jointly proposed by DPP Legislator Parris Chang (
Loh resigned on June 19 after longstanding discord with the foreign ministry, which supervises the ICDF, over Taiwan's foreign aid operations.
Comparing the two bills, some said the foreign ministry simply tried to make related rules "as ambiguous as possible" to allow room for further leverage in the future.
"The more vague the rules are, the more convenient it is to conduct diplomatic work," said Lee Pai-po (
KMT Legislator Lee Shang-ren (
"The foreign ministry of course will talk about how the bill, once passed, can increase transparency of foreign aid practices, but in reality it'll retain some flexibility in the rules so as to allow room for handling related situations as they arise," Lee said.
Compared to the international cooperation and development law, the foreign assistance law includes rules that seek an apparent increase in transparency and moral justification of Taiwan's foreign aid, observers said.
For instance, the bill stipulates that all confidential assistance programs must obtain prior approval of the Legislative Yuan, and that non-confidential programs should be published on the Internet.
The bill also adds an "exclusion clause "that excludes from Taiwan's assistance governments that violate human rights, sponsor terrorist activities, traffic drugs, seize the assets of the Taiwan government and its citizens without quickly offering adequate compensation, or discriminate against the citizens of Taiwan.
Critics offered mixed views on the absence of these two rules in the official draft of the bill.
On the rule stipulating that confidential aid programs should obtain the legislature's prior approval, KMT Legislator Lee endorsed the rule, saying: "Supervision by the legislation is a must so as to avoid fraudulent practices."
But Huang Wei-feng (
The ICDF's Lee said it's unlikely the foreign ministry will allow the legislature to have prior approval of confidential aid programs "because some programs simply won't pass the scrutiny of lawmakers."
As to the exclusion clause, some saw the rule as "reasonable." Others doubted the feasibility of the rule, taking into account the shabby human rights records of some of Taiwan's allies.
"I find the exclusion clause rather reasonable," said Huang, adding that to aid countries that discriminate against Taiwan or engage in terrorism is not justifiable.
KMT Legislator Lee said it's no wonder the foreign ministry's version lacked such an exclusion clause since "some of the ruling officials in our ally countries have been blacklisted by international human rights organizations."
The ICDF's Lee also found the clause, though morally justifiable and accepted by many multilateral foreign aid institutions, difficult to be put into practice in Taiwan.
With regard to restructuring foreign aid units, the executive branch's draft bill stipulates that the foreign ministry should be in charge of foreign aid and two related units will be set up under the ministry.
The International Cooperation and Development Policy Committee is to be in charge of the "planning, decision-making and coordination" of foreign aid programs, while the International Cooperation and Development Consultation Committee, to be composed of professionals and scholars, is to offer related advice to the ministry.
The foreign assistance law, however, stipulates that a foreign aid committee should be established directly under the Executive Yuan, with related ministries, the ICDF's secretary general, professionals as well as opposition lawmakers as members of the committee.
Such a restructuring proposal by veteran foreign aid expert Loh, critics admitted, is unlikely to be realized.
"The foreign ministry may seek internal operations to improve transparency problems. But it's unlikely for the ministry to accept the proposal of allowing a higher-level unit be in charge of foreign aid," Huang noted.
Indeed, the diplomatic race across the Taiwan Strait has infused inevitable political considerations into Taiwan's foreign aid programs. Although the ideas put forward by Loh, a veteran World Bank staffer from 1964 to 1996, reflected the professional rationale behind what foreign aid operations should be, Taiwan's squeezed international space complicates the task to reform foreign aid practices.
ICDF's Lee summed up the dilemma rather directly: "Loh's suggestions have been rather to the point. But good advice, like medicine, is hard to take."
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