[ADRN Issue Brief] Reform Measures for Korea's ODA for Democracy Assistance

Aid and Democracy Assistance

As of 2022, Korea provided USD 2.79 billion (0.17% of its Gross National Income) in Official Development Assistance (ODA), ranking 16th among donor countries within the Development Assistance Committee (DAC) of the Organization for Economic Cooperation and Development (OECD), which comprises 30 member countries. Since joining the DAC in 2010, Korea's ODA has gradually increased. Korea's successful transition from a recipient to a donor country is a remarkable global achievement. However, considering Korea's high standing in liberal democracy, its level of democracy assistance remains relatively low.

While there is no clear definition of democracy assistance, it generally refers to aid used to advocate for and support democracy. As democracy assistance can be perceived as interference in the internal affairs of partner countries, it is not prominently featured in development cooperation, where poverty reduction and socioeconomic development are the primary goals. The DAC also sets standards and makes recommendations for aid policies across various sectors, including development, trade, industry, as well as environment, gender equality, anti-corruption, and civil society strengthening, with the aim of contributing to Sustainable Development Goal 2030, which includes inclusive and sustainable economic development, progress in equality within and between countries, poverty eradication, and improvement of living conditions in developing countries. In short, the DAC does not explicitly state the promotion of democracy as an objective of aid (OECD n.d.).

Korea's International Development Cooperation Basic Act also states, "The purpose of this Act is to contribute to the common prosperity of humanity and world peace through international development cooperation by enhancing the appropriateness and effectiveness of international development cooperation policies and effectively achieving the policy objectives of international development cooperation." The Act specifies the basic principles of international development cooperation as respecting the principles of the UN Charter, supporting the self-help efforts and capacity of partner countries, respecting the development needs of partner countries, expanding the sharing of development experiences, and promoting mutual harmony and cooperation with the international community. It does not contain any wording linking aid to democracy (OECD 2005; Korea Legislation Research Institute n.d.).

The long-standing question of "Is aid effective?" has primarily focused on its economic development impact, and consequently, donor aid has centered on projects related to building national capacity and institutions (Riddell 2007). The Paris Declaration, announced in 2005, also sets the objective of its five principles of aid effectiveness—ownership, alignment, harmonization, results-oriented monitoring, and mutual accountability—towards the socioeconomic development impact of aid. Among the 17 Sustainable Development Goals (SDGs), which form the basis of the current aid system, only Goal 16, "Peace, Justice and Strong Institutions (inclusive)," is related to the advocacy of democracy.

Careful consideration is required regarding how the 'Do No Harm' principle, which states that humanitarian aid in conflict situations such as civil war, conflict, or disaster should not have negative impacts, should be viewed from the perspective of democracy assistance. This principle was established out of concern for the potential negative consequences of aid intervention, such as unintentionally exacerbating political conflicts within partner countries or hindering nation-building. The United Nations High Commissioner for Refugees (UNHCR) emphasizes the 'Do No Harm' principle from ethical perspectives such as impartiality, neutrality, transparency, and accountability (UNHCR 2019). The OECD recommends that donor countries, when providing aid, possess sufficient knowledge of local political dynamics and historical backgrounds, and focus on strengthening inclusive political processes, national legitimacy, constructive state-society relations, and appropriate state functional capacity.[1]Aid should contribute to integrated nation-building while maintaining political neutrality towards local power dynamics, such as political confrontations between power groups and conflicts between elites and societal forces. This approach focuses more on nation-building and social integration than on democracy assistance.

However, a trend is emerging that advocates for democracy assistance, which was not previously at the forefront, by integrating it with geopolitical interests. While donor aid has evolved to enhance effectiveness based on recipient country needs, donor interests have also been a underlying factor in aid policies (Lancaster 2007; Haan 2009). Donor countries promoting democracy have historically prioritized security, economic interests, or diplomatic influence over the advocacy of democracy itself. Consequently, democracy advocates have often criticized Western donor countries for neglecting democratic values and human rights in their overseas aid. Notably, for the United States, the largest donor in terms of total aid, security and diplomatic cooperation have been the primary drivers of its aid policy. With the increasing tendency to view the international landscape through the lens of democracy versus autocracy under the Biden administration, there is a growing call to more strongly reflect democracy assistance in U.S. foreign policy, including its aid policies (Task Force on US Strategy 2021).

Unlike his predecessor, President Biden is actively incorporating democracy into foreign policy, and in this spirit, he established the Summit for Democracy, holding its first meeting in December 2021. The U.S. efforts to promote global democracy have intensified following the Russian invasion of Ukraine in February 2022. Under the 'Presidential Initiative for Democratic Renewal,' the U.S. Agency for International Development (USAID) is leading support in five areas: independent media, anti-corruption, support for democracy reformers, advancing technology for democracy, and protecting elections and inclusive political processes (White House 2022). Samantha Power, the head of USAID, argues that the right way to counter authoritarianism is to break down the walls between value-neutral economic development aid, which has focused on advocating for individual rights, and to incorporate democracy assistance into all economic programs, including aid (Power 2023).[2]There is also an argument that when there are voluntary citizen resistance movements against authoritarianism, international democracy assistance should be provided as an extension of internationally recognized human rights advocacy, without being absolutely bound by the principle of non-interference in internal affairs. To this end, a norm of a "right to assistance (for democracy)" should be established (Merriman, Quirk, and Jain 2023).

Criticism also exists regarding the trend of linking democracy assistance with geopolitical interests. Some argue that democracy assistance should not be driven by development or geopolitical perspectives, but should focus on its inherent mission of advocating for individual rights, such as the rights of minority groups, and the political freedoms of journalists and anti-government figures (Pepinsky 2021). This argument extends the existing logic that democracy assistance should not be subordinated to the donor country's security or economic interests and should consistently adhere to democracy assistance. While these two arguments differ in their views on why democracy assistance is important, they agree on the need to increase aid for the protection and promotion of democracy.

The Yoon Suk-yeol administration in South Korea is integrating universal values such as freedom, human rights, and the rule of law into its foreign policy. As part of this effort, in a keynote speech at the second Summit for Democracy Indo-Pacific Regional Meeting, the President pledged to provide USD 100 million in development cooperation over the next three years to Indo-Pacific countries in areas that can contribute to the promotion of democracy, such as e-government, digital and technological capacity building, transparency, and anti-corruption. Following the President's remarks, the Ministry of Foreign Affairs held a consultative meeting on grant aid in May and increased the proposed grant aid budget for 2024 to a total of KRW 3.4281 trillion, a 29.3% increase from the previous year. However, the aid pledged at the Summit primarily consists of technical assistance, such as e-government and digital technology provision, or capacity-building projects for recipient governments, raising questions about its actual contribution to democracy assistance.

As democracy declines globally and authoritarianism gains ground, support for the active promotion of democracy assistance has strengthened among Western donor countries. The South Korean government, which actively espouses liberal democracy in its foreign policy, also wishes to share this approach. In this context, it is a critical time to discuss which areas of democracy assistance Korea should expand, the conditions of recipient countries that allow for focused democracy assistance, and the implementation methods for effective democracy assistance.

Areas of Democracy Assistance Korea Should Expand

An OECD report compares DAC's governance and civil society support sectors, dividing them into state-building and democracy promotion. The former includes public policy and administration, public financial management, decentralization and local government support, anti-corruption organizations and institutions, revenue mobilization, public procurement, legal and judicial development, and macroeconomic policy. The latter encompasses support for democratic participation and civil society, legislatures and political parties, media and free flow of information, human rights, organizations and institutions for women's equality, eradication of violence against women and girls, and promotion of orderly, safe, and regular migration. According to an OECD report analyzing aid provided by all donor countries to 124 recipient countries between 2010 and 2019, 73% of governance aid during this period was used for state-building and 27% for democracy promotion, with these proportions remaining relatively stable year by year.[3]

In Korea's ODA, democracy assistance is implemented through grant aid. Among the 12 areas of activity listed on the website of the Korea International Cooperation Agency (KOICA), the implementing agency for grant aid, the areas related to democracy are Governance and Peace, Gender Equality, and Human Rights. Within the core Governance and Peace sector, the mid-term strategy identifies 'Participatory and Inclusive Democracy' as a strategic objective related to democracy. Programs to achieve this objective include support for inclusive elections and legislative activities, and expansion of the foundation for participatory democracy. The other areas, 'Conflict Prevention and Peaceful Lives,' relate to community and social integration; 'Safe and Just Judicial and Public Security Systems,' and 'Responsible and Efficient Administrative Systems' pertain to public institutions and systems (KOICA n.d.). Aid for Peace and Governance accounted for 15-18% of total ODA between 2016-2019, with 81% of this being governance aid and 19% peace-related aid. Governance aid was distributed in the order of administrative systems (62%), judicial and public security systems (19%), and legislative support (5%). Consequently, KOICA's governance aid was largely used for improving administrative systems, strengthening public administration capacity, and training programs (Kim Tae-gyun 2021). The issue is that support for judicial and public security systems or capacity building for administrative agencies falls under state-building and is difficult to consider as democracy assistance. Korea's classification of state capacity as governance aid likely reflects its historical experience of modernization through the developmental state or administrative state model.

Adhering to a narrow definition of democracy assistance, KOICA's programs include support for elections and legislative activities, and support for participatory democracy. The Association of World Election Bodies (A-WEB), established and funded by Korea's National Election Commission, is responsible for supporting democratic elections and exchanges among election management bodies worldwide, thus providing a foundation for activities in this area. However, government funding, which was provided alongside subsidies, has been significantly reduced, and the organization is currently not fully active. Given that Korea has taken the lead in establishing an international consultative body for election commissions and serves as its secretariat, there is a need to improve the legal and financial status of A-WEB and develop it into a channel for democracy assistance. Regarding participatory democracy, active citizen participation, both online and offline, in Korean society can be programmed according to the context of partner countries. In particular, participatory budgeting systems, which have been used for local government budget formulation, and digital petition systems and policy proposals can assist citizens of partner countries in political participation.

Support for free media activities is considered important for democratic governance, but Korean aid agencies have not actively engaged in it. This is likely because Korean aid is primarily based on government-to-government contracts, making it difficult to support private media, and media support can be perceived as interference in domestic politics, which is avoided. However, given the diversity and large number of independent media outlets in Korea, neglecting support for free media means failing to utilize existing capabilities. In this case, rather than bilateral aid, exploring partnerships with multilateral organizations or Western private institutions that support free media could be a viable approach. Support for immigrants and refugees is also gaining attention within the framework of democracy assistance. Although the Korean government, which has strong controls on immigration and refugee influx, is now in a position to more actively accommodate people's movement, it can find drivers for domestic immigration and refugee governance reform through international aid activities. In terms of gender equality, one of Korea's major achievements, promoting women's rights through education and employment could be a strength of Korea's democracy assistance.

In summary, Korea's governance aid is concentrated on strengthening administrative capacity, and its typical democracy assistance is weak. It is evident that democracy assistance in areas such as civil society strengthening and press freedom, rather than state capacity or technical support, is effective in promoting democratic governance in recipient countries, and therefore, aid in these areas needs to be reinforced.

Korean Aid: Focus Democracy Assistance on Newly Democratizing Countries

Despite a consensus among DAC donor countries that aid should contribute to good governance, their aid does not discriminate based on the political system of partner countries, which is the general consensus. A recently published OECD report analyzes how ODA was provided across different regime types between 2010 and 2019. Trends in aid provided by all donor countries, including OECD DAC members and non-members, to 124 recipient countries during this period show that the total amount of aid flowing to autocratic countries increased by 15 percentage points, from 64% of total ODA in 2010 to 79% in 2019. Aid to closed autocracies, which do not even hold direct elections, increased by 178%, and aid to electoral autocracies, which hold elections but are undemocratic, increased by 41%.[4]This is because the number of autocratic countries increased from 68 to 75 over the decade, and humanitarian aid to autocratic countries increased 19-fold. The crises in Syria and Yemen since 2015 clearly illustrate the dilemma of having to increase humanitarian aid to these countries even as authoritarianism intensifies. Furthermore, emerging donors such as Turkey, the United Arab Emirates, and Saudi Arabia significantly increased humanitarian aid to autocratic countries during the same period. As non-DAC members, these countries were not bound by the committee's aid principles that emphasize human rights or democratic governance.

Given that the primary objectives of ODA are poverty reduction and economic development, it may seem natural that the flow of total aid does not significantly consider the political systems of partner countries. What then about aid aimed at improving governance? The same report indicates that while governance aid increased from 65% to 73% of total ODA in the 2010s, this was entirely due to a 150% increase in governance aid to closed autocracies. This suggests that governance aid also did not discriminate based on regime type. Even when looking solely at democracy promotion aid (i.e., excluding aid for state-building from total governance aid), the situation does not change significantly. Within democracy promotion aid, support for participation and civil society consistently accounted for the largest share, while election support decreased, and support for human rights and women increased. However, democracy promotion aid also appears to have been provided without much consideration for the specific characteristics of partner countries' political systems, where needs and opportunities can vary considerably. For example, five Development Assistance Committee member countries—the United States, the European Union, Sweden, the United Kingdom, and Germany—accounted for 70% of total democracy promotion aid for participation and civil society, yet even they showed little differentiation based on regime type. Between 2010 and 2019, democracy promotion aid to closed autocracies increased by 72%, with this category of aid flowing to Somalia, Jordan, South Sudan, China, Morocco, and Syria.

These trends indicate that even aid labeled as democracy assistance continues to be provided to autocratic countries for various reasons, without a corresponding expectation of democratization. However, it is important to note that the fact that democracy assistance was provided regardless of the recipient country's regime type does not necessarily mean it had no democratizing effect. Recent empirical studies have found that democracy assistance helps democratization. A study by Lührmann et al. (2018), which compared OECD countries' aid before and after 2002-2012, found democratizing effects on electoral democracy levels, core civil society, and civil liberties. Their argument is that democracy promotion aid, which fills in the gaps, is effective, as long as it does not threaten the recipient country's regime (Lührmann et al. 2018). A study by Gafuri (2022) analyzing EU democracy assistance between 2002-2018 found that the EU's democracy assistance to 126 recipient countries led to a 0.01 point increase in the V-Dem Electoral Democracy Index, and that each dollar of democracy aid disbursed per capita in recipient countries led to a 0.009 point increase in the electoral democracy index two years later, indicating a modest democratizing effect. A report by Niño-Zarazúa et al. (2020) analyzing the effects of Sweden's democracy promotion aid over 25 years suggests that while the overall effect is marginal, the impact of democracy assistance is significant when recipient countries are on an upward trend of democratization. Therefore, it is not advisable to reduce aid once a certain level of democratization is achieved before consolidation, and it is recommended to focus democracy assistance on areas essential for consolidation, such as human rights, participation and civil society strengthening, and free media.

A recent report by Cheeseman and Desrosiers also argues that while aid should not be halted for authoritarian countries, priority should be given to countries where democracy is gradually weakening. Most importantly, they emphasize the principle of consistent and sustained engagement with recipient countries, arguing that when engaging with these countries, prioritizing security or economy should not compromise the principle of not harming democracy (Cheeseman and Desrosiers 2023).

In conclusion, even when supporting autocratic countries for humanitarian reasons, donor countries are not focusing their assistance on newly democratizing countries. If donor countries wish to expect democratizing effects from governance support, it is advisable to support emerging democracies in their democratization process. Therefore, it is necessary to focus aid on areas needed by specific recipient countries undergoing democratization, with expectations of gradual, long-term democratizing effects.

Korean Aid: Diversify Aid Implementation Methods Through Partnerships with Civil Society Organizations and Democracy Donor Countries

The majority of Korea's overseas aid consists of government-to-government aid based on contracts with recipient country governments. Aid disbursed through partnerships with non-governmental private organizations still accounts for only about 4% of the total. This is significantly different from the aid practices of Western donor countries, which implement support for civil society in recipient countries through private channels.

Article 2 of the International Development Cooperation Basic Act defines international development cooperation as "Official development cooperation (hereinafter referred to as 'bilateral development cooperation') provided directly or indirectly by the state, local governments, or public institutions to developing countries for their development and welfare promotion, and multilateral development cooperation provided through contributions, investments, and concessional loans to international organizations." International organizations here refer to intergovernmental or non-governmental international organizations designated by the OECD DAC with which Korea cooperates through financial contributions or joint project implementation. Therefore, according to this legal provision, joint projects can be pursued through non-governmental international organizations. Given the legal basis, the Korean government should diversify aid implementation through innovative methods that encompass partnerships with domestic and international non-governmental organizations and public-private cooperation.

Consideration can also be given to further activating multi-bilateral assistance. Multi-bilateral assistance is a system where funds are entrusted to international organizations for specific purposes, such as recipient countries, regions, sectors, or themes, and it is distinct from multilateral aid where international organizations have decision-making authority. Multi-bilateral assistance offers advantages for donor countries to leverage the experience and expertise of international organizations while avoiding political sensitivities compared to intergovernmental bilateral aid. Donor countries often utilize UN-affiliated international organizations for urgent relief aid in vulnerable countries affected by natural disasters or conflicts. Korea has also used this method for disaster relief in least developed countries in Africa and the Philippines (Cho Hyun-joo, Kim Eun-mi, and Jeong Heon-joo 2015). Applying this to democracy assistance could help local democratic governance by utilizing the expertise of international organizations specialized in democracy support and adhering to the principle of non-interference in the politics of partner countries. Partnerships among like-minded democracy donor countries are also possible. Donor countries sharing common goals could achieve synergistic effects, such as reducing administrative costs for aid to recipient countries and expanding the scale of development aid.

Conclusion

Korea is a prime example of a liberal democracy donor country that has achieved both economic development and democratization. However, it has taken a passive stance on aid for supporting democracy in partner countries, lacking clear principles and norms. At a time when democracy is declining worldwide, the need to establish a framework for democracy assistance to promote democracy has become increasingly urgent. This paper proposes the urgent establishment of democracy assistance, even if it may not significantly alter Korea's existing aid policies focused on economic and social development. Specifically, it suggests: first, increasing democracy assistance in areas such as election support, citizen participation, and free media support, beyond existing aid for government capacity building or technical assistance; second, focusing on emerging democracies that lie between authoritarianism and consolidated democracy when selecting recipient countries; and third, implementing aid that directly supports civil society and media in recipient countries through partnerships with domestic and international private organizations and public-private cooperation, as well as through cooperation with international organizations and like-minded democracy donor countries. The starting point for these reforms is to align with the aid classification and systems of DAC donor countries while designing programs tailored to Korea's circumstances. Aid diplomacy should be complemented by promoting democratic governance, moving beyond poverty alleviation and economic development. This is because sustainable development and stable peace are difficult to achieve without established democratic governance. ■

[1]The report suggests that elections should not be held in the near future if they exclude certain groups, and that raising citizens' expectations too high is not helpful in conflict situations. If the government of a fragile state is unable to perform its functions, providing services through civil society organizations is akin to creating two public sectors; therefore, it is preferable to distribute aid resources through the state sector (OECD 2010).

[2]USAID categorizes its activities into 13 areas, one of which is 'Democracy, Human Rights, and Governance.' https://www.usaid.gov/democracy

[3]This report excludes multilateral aid to international organizations, etc., as it examines the relationship between aid and recipient country regime types. However, multilateral aid accounts for 70% of total ODA in terms of total amount. For regime classification in democracy diversity studies, refer to Lührmann et al. (2018).

[4]The aid provided to closed autocracies, which increased by 178%, was primarily channeled through multilateral aid into the public sector, with allocations by sector including humanitarian aid (34%), social infrastructure and services (29%), economic infrastructure and services (14%), and commodity aid and program support (7%).

References

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■ Lee Sook-jong_Senior Fellow, East Asia Institute. Distinguished Professor, Sungkyunkwan University.

■ Managed and Edited by: Park Han-soo_EAI Researcher

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