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International Community Pledges to Increase Aid Efficiency

China and many emerging countries agree to work with industrialized counties to create new global partnership for development

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William Eagle

A declaration by the delegates said the partnership would be new and inclusive and would represent both recipient countries and members of the OECD, the Organization for Economic Cooperation and Development.  It said, “The new partnership will offer an open platform, embracing diversity and providing a forum for the exchange of knowledge and regular reviews of the process.”

Included in that diversity are emerging countries that are already establishing significant aid and investment programs, like Brazil, Russia, India, China and South Africa. But according to the final document, their adherence to the principles followed by members of the OECD are not binding. The goals include the coordination of donor aid programs to avoid duplication and promote greater efficiency and transparency in the use of aid.Signatories also agree to support efforts by recipient countries to design their own poverty programs and to untie aid from conditions set by donor countries.

U.S. Secretary of State Hillary Rodham Clinton delivers the keynote address during the Fourth High Level Forum on Aid Effectiveness in Busan, South Korea.
U.S. Secretary of State Hillary Rodham Clinton delivers the keynote address during the Fourth High Level Forum on Aid Effectiveness in Busan, South Korea.

China and other countries have endorsed the document.

But OECD officials called it a starting point, and Britain’s international development secretary, Andrew Mitchell, said it represents an acceptance of common goals and shared commitments, “ships,” he said, “moving in the same direction, albeit with different speeds.”

Different Traditions

Brian Atwood is the former head of USAID and the chair of the Development Assistance Committee (DAC) of the OECD. He said the agreement takes into account the differences in approach to aid of the southern countries, especially with regard to overseas development assistance (ODA).

"It’s made clear in the document," he said, "that the tradition of south-south cooperation is a different one. We acknowledge that, but we have said as well what’s really important are results at the country level, and we agree to coordinate our activities at that level. The enforcement mechanism for that are the countries themselves. They want to own their programs, to develop their own strategies and have donors and providers to work together to get results. So we will continue to have differences in approach."

The south-south providers do not want the same kinds of regimes that we use [to measure and deliver aid] in the north and the [Development Assistance Committee of the OECD] as in counting the volume of ODA, and agreeing not to tie our aid [to conditions set by donors]. But we did not expect they would agree to that. What we had to struggle to get was  to get an agreement for a global partnership. That’s the achievement of Busan.

Third-country cooperation

Atwood says OECD countries and members of the global south are already working together in what he calls “triangular” efforts in third, or host, countries.

"There’s been a very big increase in triangular programs," he said, "where a host country will work [for example with] the Chinese and Americans, or the Brazilians, who work with the Mexicans and Americans. We’ve seen a big increase in those kinds of programs. We’d like to evaluate them and look at best practices. That’s positive. Just the fact that you’re working on the ground with another country coming from another tradition is a learning exercise and creates convergence."

Fragile states

Delegates to the meeting also agreed to focus aid on strengthening fragile states with weak governmental institutions, like South Sudan and the Democratic Republic of the Congo. Many are concerned that they will not have the capacity to reach the U.N.’s Millennium Development Goals, which aim for drastic reductions in poverty and maternal and child mortality. Atwood described the type of assistance that a coalition of fragile states, called the G7+, wanted from the forum.

Former British Prime Minister Tony Blair at 4th High-Level Forum on Aid Effectiveness. He expressed optimism about Africa's future, saying eight economies from sub-Saharan Africa have more than doubled in size.
Former British Prime Minister Tony Blair at 4th High-Level Forum on Aid Effectiveness. He expressed optimism about Africa's future, saying eight economies from sub-Saharan Africa have more than doubled in size.

"They want a new set of goals for their particular needs," he said. "They want to prioritize legitimate politics, which means helping them with elections and setting up parliaments; people’s security, which relates to people feeling secure in their own homes, without having the military around; and a justice system that works…all of these are goals for them. They want country-led and owned programs and they want the capacity to carry out the programs."

Improved transparency

The conference also highlighted OECD’s progress on transparency, country ownership of projects and support for women.

The United States agreed to join the International Aid Transparency Initiative, an effort to regularly disclose and detail aid commitments and disbursements. The initiative also supports improved information systems for managing aid.

Secretary of State Clinton said one recent example of US commitment to transparency is the recent launch of a web site to follow U.S. aid investments, the Foreign Assistance Dashboard. It’s located at www.foreignassistance.gov. She also announced a new joint effort by several governments and international organizations called EDGE, or Evidence and Data for Gender Equality. The initiative will provide data on women’s entrepreneurship and assets. U.S. officials say the information should help to reform credit policies, ownership and inheritance laws that discriminate against women.

Recipient countries have also shown progress in opening their budgets to scrutiny and in designing their own aid programs. This year Kenya unveiled its “open data initiative,” which allows the public to access budget and spending information.

"I was impressed with Cape Verde’s system using modern technology to keep track of the (aid) flows coming into their country, using it to measures results," said Atwood. "The Rwandans have done a wonderful job with a strong development unit where they do strategic planning and coordination and they are in the lead – telling donors what they want done. Ghana has a strong system as well."

Tied Aid

Atwood said the conference also highlighted progress among the OECD members on separating aid from conditions set by donors.

He said today about 70 percent of aid has been untied from those demands. He said many recognize that more must be done to cut costs and improve efficiency by using local sources for material and services and by having open-bidding for projects by companies and non-profits.

But Atwood says untying aid completely from donors’ domestic needs may be difficult. That’s because linking foreign aid to, for example U.S.-made goods and services helps ensure support for foreign aid among the tax-paying public. Still, he expects aid will be completely untied over the next few years.

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