1 Presentation to the Overseas Development Institute Friday, 30 January 2004 London Development Cooperation Report 2003 Presentation by Richard Manning,

1

Presentation to the Presentation to the Overseas Development InstituteOverseas Development Institute Friday, 30 January 2004Friday, 30 January 2004London

Development Cooperation Development Cooperation Report 2003Report 2003

Presentation by Richard Manning, Presentation by Richard Manning, Chair of the Development Assistance Chair of the Development Assistance

Committee to the OECDCommittee to the OECD

2

Report Highlights Report Highlights

Aid in ContextAid in Context

Aid volumeAid volume

Aid allocation Aid allocation

Aid effectivenessAid effectiveness

Aid policy controversiesAid policy controversies

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Aid in Context (1)Aid in Context (1)

Significant progress in poverty Significant progress in poverty reduction, notably Asiareduction, notably Asia

Serious shortfalls in health and Serious shortfalls in health and environmentenvironment

Mixed picture on education and on Mixed picture on education and on gendergender

Progress towards Millennium Development GoalsProgress towards Millennium Development Goals

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MDG Charts MDG Charts

People living on less than $1/day (%)

0

10

20

30

1990 1995 2000 2005 2010 2015

Progress 1990 - 1999

Average path to goal

5


People living on less than $1/dayin Sub-Saharan Africa (%)

0

10

20

30

40

50

60

1990 1995 2000 2005 2010 2015



6


Deaths of children under 5 per 1000 live births

020406080

100120

1990 1995 2000 2005 2010 2015



7


8


Net primary enrollment (%)

50

60

70

80

90

100

1990 1995 2000 2005 2010 2015

Progress 1990/91 - 2000/01


9


Ratio of girls to boys in primary school (%)

50

60

70

80

90

100

1990 1995 2000 2005

Progress 1990/91 - 2000/01


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Data sources: Sudhir Shetty’s study, September 2003.

All targets are met At least one target is met None of the targets is met

Poverty Education Health Environment Poverty Education Health Environment

Benin

Burkina Faso

Ethiopia

Madagascar

Mali

Mauritania

Mozambique

Tanzania

Uganda

With better policies, institutions and additional external resources

With current policies, institutions, and external resources

Potential impact of additional ODA on MDGs’ achievement

Potential impact of additional ODA on MDGs’ achievement

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Aid in Context (2)Aid in Context (2)

Development first and foremost the Development first and foremost the responsibility of developing countries.responsibility of developing countries.

Their policies and institutions critical to progress.Their policies and institutions critical to progress.

Roles for Governments, Parliaments, Private Sector, Roles for Governments, Parliaments, Private Sector, Civil Society.Civil Society.

But OECD policies also critical in setting enabling environment:But OECD policies also critical in setting enabling environment:

- trade/ agriculture/ debt/ migration/security.- trade/ agriculture/ debt/ migration/security.

Need “policies as if development mattered”.Need “policies as if development mattered”.

The Importance of PoliciesThe Importance of Policies

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Aid in context (3) Aid in context (3)

Aid and private flowsAid and private flows

Chart 2.2: DAC members' resource flows to developing countries, 1980-2002

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1980

1985

1990

1995

2000

2002

Sh

are

of

DA

C G

NI

(%)

Other Private

Directinvestment

Net Grantsby NGOs

Other Official

FlowsODA

13

Evolution of Aid Flows 1980-2006Evolution of Aid Flows 1980-2006

0.34

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

% o

f G

NI

0

10

20

30

40

50

60

70

80

OD

A (

2001

US

D b

illio

n)

ODA as a % of GNI (left scale)

Total ODA(right scale)

0.22

0.34

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

% o

f G

NI

0

10

20

30

40

50

60

70

80

OD

A (

2001

US

D b

illio

n)



0.22

0.34

0.23

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

% o

f G

NI

0

10

20

30

40

50

60

70

80

OD

A (

2001

US

D b

illio

n)



0.29

0.22

0.34

0.23

0.00

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

% o

f G

NI

0

10

20

30

40

50

60

70

80

OD

A (

2001

US

D b

illio

n)



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2006 outcome depends crucially on five donors 2006 outcome depends crucially on five donors

Net ODA

2002 Anticipated ODA

2006

Increment

United States 13.3 19.5 6.2 United Kingdom 4.9 6.9 2.0 France 5.5 7.4 1.9 Italy 2.3 4.2 1.9 Germany 5.3 7.1 1.8 Sub-total 31.4 45.1 13.8 All other DAC members 26.9 31.7 4.8

TOTAL 58.3 76.8 18.6

US$ billion (at 2002 prices and exchange rates)

Table 1.1 Anticipated ODA - 2006

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Aid Allocation Aid Allocation

more performance-linkedmore performance-linked

Aid is becoming:Aid is becoming:

Share to quintiles 4 and 5

0%

5%

10%

15%

20%

25%

1995 1996 1997 1998 1999 2000 2001 2002

Share to quintiles 1 and 2

0%

20%

40%

60%

80%

1995 1996 1997 1998 1999 2000 2001 2002

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more allocated to governance and healthmore allocated to governance and health

0

5

10

15

20

25

30

35

1980-81 1985-86 1990-91 1995-96 2000-01

%

Education Water Health Governance and other

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at the expense of production sectors, at the expense of production sectors, including agriculture and energyincluding agriculture and energy

0

5

10

15

20

1980-81 1985-86 1990-91 1995-96 2000-01

%

Agriculture Industry

0

5

10

15

20

25

1980-81 1985-86 1990-91 1995-96 2000-01

%

Transport Energy Banking&Business

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food and commodity aid are down but food and commodity aid are down but humanitarian aid up ; debt relief fluctuateshumanitarian aid up ; debt relief fluctuates

0

10

20

30

40

1980-81 1985-86 1990-91 1995-96 2000-01

%

Emergency AssistanceDebt Relief

Commodity Aid and Programme AssistanceFood Aid

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the share to least developed and low-the share to least developed and low-income countries is little changedincome countries is little changed

Share of total ODA to least developed and low-income countries

0%

10%

20%

30%

40%

50%

60%

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

but some evidence of shift towards but some evidence of shift towards AfricaAfrica

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0%

10%

20%

30%

40%

50%

60%

70%

80%

1992

2002

- multilateral share is little changed- multilateral share is little changed

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- the share to the UN system and to - the share to the UN system and to the EC has risen slightly the EC has risen slightly

IDA & RDBs share

0%10%20%30%40%50%

1990 1992 1994 1996 1998 2000 2002 2004

EC Share

0%

10%

20%

30%

40%

1990 1992 1994 1996 1998 2000 2002

UN Share

0%

10%

20%

30%

40%

1990 1992 1994 1996 1998 2000 2002

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- - but concessional spending by multilateral but concessional spending by multilateral development banks has risen because of development banks has risen because of recycling of repaymentsrecycling of repayments

0

1

2

3

4

5

6

7

8

9

10

EC UN IDA & RDBs

Co

nsta

nt

2000 $

bn

1992

2001

- European Commission the third largest source of funds after US and Japan

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Aid Effectiveness (1)Aid Effectiveness (1)

Crucial issue and central to DAC roleCrucial issue and central to DAC role

Hard to assess : need for better evaluationHard to assess : need for better evaluation

Surprising range of aid and activitiesSurprising range of aid and activities

Over $100m $10-100m $1m to $9.99m Under $1m

% by value 25 42 24 9 % by number 0.2 2 12 85

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Aid effectiveness (2)Aid effectiveness (2)

Some progress aroundSome progress around- Poverty Reduction Strategies- Poverty Reduction Strategies- Medium Term Expenditure Frameworks- Medium Term Expenditure Frameworks- Harmonisation and Alignment- Harmonisation and Alignment

Important Work of DAC Aid Effectiveness Working PartiesImportant Work of DAC Aid Effectiveness Working Parties

- turning principle into practice- turning principle into practice

- predictability- predictability

- financial management and procurement- financial management and procurement

- managing for results- managing for results

Tackling the problems of weak states, post-conflict, Tackling the problems of weak states, post-conflict, and poor performersand poor performers

From Rome to ParisFrom Rome to Paris

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Constructive Policy Dialogue Constructive Policy Dialogue

Growth or poverty reduction?Growth or poverty reduction?

Public or private?Public or private?

Social sectors or production and infrastructure?Social sectors or production and infrastructure?

Projects or programmes?Projects or programmes?

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Aid at least USD 75 billion (at 2002 prices and exchange rates). Significant increase in proportion to least developed and other

low income countries, and particularly to the good performers. Well-considered interventions in the poor performers. Declining proportion of emergency and humanitarian aid. Increase in untied aid. Developing countries improving services to the poor but also

mobilising greater domestic resources. Much more aid aligned to local priorities, programmes and

systems, and shown in recipient budgets. Much more harmonisation. Bulk of increased aid involves a genuine transfer of resources

and Technical Cooperation demonstrably more efficient. More progress towards MDG’s, especially in Africa, as a result.

My hopes for 2006My hopes for 2006

Documents

1 Presentation to the Overseas Development Institute Friday, 30 January 2004 London Development Cooperation Report 2003 Presentation by Richard Manning,