Overview of Development Assistance

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Overview of Development Assistance

• Antonio Tujan Jr

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Aid and the right to development

• Post-war context and national struggles for
  independence and liberation
• Post-war reconstruction and war reparations
• Right to independence and development
• International community responsibility for peace
  and development, end disease, famine and war

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Development cooperation and aid

• Based on common goals to end famine, disease and
  poverty and against war
• Based on common principles of equality, mutual
  cooperation, and benefit
• Based on shared values and goals of cooperating
  parties
• Covers a wide range of activities

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Official Development Aid

• To compensate for temporary or consistent lack of
  resources for development
• Different from humanitarian aid, military aid
• Material, services or financial form
• Loans or grants?

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Development Cooperation and Aid

• Development cooperation and ODA as essential
  contribution to support poverty reduction and
  development
• UN resolution 2626 of October 1970 to increase
  aid to 0.7 of GNP by mid 70s
• Monterrey commitments
• MDG and Millennium Declaration
• Aid quantities remain seriously deficient

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DAC members' net ODA 1990-2005 and DAC
Secretariat simulations of net ODA to 2006 and
2010
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Components of net DAC ODA, 2000-2005
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Development Aid and Debt

• Grants are preferred form of financial assistance
• Grants are essential in context of antipoverty
• Loans as forms economic cooperation
• The issue of compounded interest

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Neocolonial debt crisis

• To finance BOP deficits due to neocolonial trade
  and investment
• To finance misprioritized development loans
• Compounded interest
• Neocolonial debt crisis and new loans for
  refinancing/debt service

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Debt crisis and development finance

• Debt crisis as counterforce in destroying
  development in general and for highly indebted
  countries
• Debt crisis as determining factor in development
  finance strategies and management
• Debt cancellation as essential strategy
  accompanying increasing aid and reforming aid
  effectiveness

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Aid relationshipIs aid achieving development?

• Only 32 of aid is available to recipient
  countries in 2004, from 39 in 2000
• Problem? The bulk goes to donor-directed
  technical cooperation, refugees in donor
  countries, foreign student costs in donor
  countries, the cost of tied aid, emergency relief
  and administration costs

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Development strategy and implementationIs aid
reducing poverty and achieving development?

• Development strategies and program effectiveness
• Human rights based and empowered development
• Aid management and delivery
• Free for all competition, weak country ownership,
  transaction costs and duplications, etc.

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Tied Aid

• Estimates that reduced aid tying to only 9 in
  2004 from 41 in 1990
• But figures do not reflect US which is estimated
  at 72
• Tying aid to foreign consultants ensures results
  plus employment of donor staff
• Tying aid to donor country supplies a system of
  export, subsidizing donor country production
• Impact of tied aid

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Conditionality

• Conditionality is contrary to ownership
• Conditionality is contrary to human rights and
  sovereignty of people
• Distinguish fiduciary responsibilities and policy
  conditionality
• Benchmarking as another form of conditionality
• Common cso position on removal of conditionalities

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Structural Adjustment Conditionality

• Promotion of neoliberal strategies in 1970s
• Monetarism
• Export promotion from import substitution model
• Washington consensus
• Financial prescriptions
• Neoliberal policy prescriptions
• Post Washington consensus
• PRSP, PRGF, PSI
• Consultation
• governance

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Redefining ownership

• Country ownership and not government only
• Implies accountability of government to citizens
• Ownership means leadership of government in aid
  partnership
• Capacity building for ownership

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Accountability

• Accountability mechanisms
• Peoples participation as key element
• transparency

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Development finance and ODA Advocacy

• Debt repudiation and cancellation
• ODA policy to increase aid
• Monterrey commitments
• Millennium Development Goals
• ODA reform or effectiveness
• Development effectiveness
• Aid effectiveness
• Paris Declaration

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Development finance and ODA Advocacy

• OECD aid effectiveness process to Ghana 08 HLF
  III
• UN Monterrey process (Doha meeting)
• UN MDGs process
• UN Development effectiveness forum