Aid Effectiveness and the Paris Declaration

The phrase ‘Aid effectiveness’ refers to the efficacy of official development assistance (ODA) in achieving economic development in recipient nations.

The 2002 Monterrey Consensus makes reference to aid effectiveness in chapter II, paragraph 40. This paragraph refers to the need for effective partnerships among donor and recipient countries based on the recognition of recipient countries leadership and ownership of development plans and, within this framework, sound policies and good governance at all levels are necessary to ensure ODA effectiveness. The Monterrey Consensus also supports efforts to increase ODA and urges developed countries that have not done so to make concrete efforts towards the target of 0.7 per cent of gross national product (GNP) as ODA to developing countries (chapter IV of the Monterrey Consensus). In order to build support for ODA, the Monterrey Consensus states that Member States “will cooperate to further improve policies and development strategies, both nationally and internationally, to enhance aid effectiveness.”

In 2005, a High-level Forum organized under the auspices of the Development Assistance Committee (DAC) of the Organization for Economic Cooperation and Development (OECD) agreed on the 2005 Paris Declaration on Aid Effectiveness. The Declaration is commonly referred to by donors as “an unprecedented global consensus” for reforming the delivery and management of aid to improve its effectiveness. It commits 90 partner countries, 30 donor countries and 30 development agencies, including the United Nations and the World Bank to five principles:

• Advancing country ownership
• Harmonization of donors and creditors
• Alignment with country-led strategies
• Managing for development results
• Mutual accountability for the use of aid

In September 2008, heads of governments, multilateral institutions and civil society organisations will gather in Accra, Ghana for the Third High-level Forum on Aid Effectiveness under the auspices of the DAC. The primary intention of this Forum is to review the progress made in implementing the Paris Declaration. The Forum will seek to identify obstacles yet to be overcome and the action needed in order to make progress in improving aid effectiveness for 2010 and beyond.

The Accra Forum will be closely followed by the Follow-up International Conference on Financing for Development to review the implementation of the Monterrey Consensus in Doha, Qatar on 29 November - 2 December 2008. It is expected that the results of the Accra meeting will feed into the discussions of Chapter II during the Review Conference in Doha.

OECD

The Development Assistance Committee (DAC, www.oecd.org/dac) is the principal body through which the OECD deals with issues related to co-operation with developing countries. The DAC Working Party on Aid Effectiveness was set up in May 2003 in the context of the international consensus reached at Monterrey on the actions needed to promote a global partnership for development and accelerate progress towards the internationally agreed development goals, including the Millennium Development Goals.

An Advisory Group (AG) on Civil Society and AE was created by the Working Party on AE to advise the Working Party and the Steering Committee planning the Third High-Level Forum on AE (Accra, Ghana, on 2-4 September 2008) on the involvement of CSOs in the AE agenda. The AG comprises 3 Southern CSOs (Afrodad, TWN, and IBON/Reality of Aid), 3 Northern CSOs (CCIC, Care International and ActionAid), 3 donors (Canada, France and Norway) and 3 partner countries (Zambia, Rawnda, Nicaragua). Canada chairs the group.

In order to effectively cover its broad mandate the Working Party has established the following five themes to examine particular areas of interest:

 Monitoring the Paris Declaration
http://www.oecd.org/department/0,2688,en_2649_15577209_1_1_1_1_1,00.html

 Public Financial Management
http://www.oecd.org/department/0,2688,en_2649_15587066_1_1_1_1_1,00.html

 Managing for Development Results http://www.oecd.org/department/0,2688,en_2649_15587075_1_1_1_1_1,00.html

 Procurement http://www.oecd.org/department/0,2688,en_2649_19101395_1_1_1_1_1,00.html

 Aid Untying http://www.oecd.org/department/0,2688,en_2649_18108886_1_1_1_1_1,00.html

Other OECD resources

 Debt Relief is down: Other ODA rises slightly

In early April, the OECD released key data on official development assistance (ODA) in 2007. According to these figures, the 22 member countries of the OECD Development Assistance Committee (DAC)-the world’s major donors-provided USD 103.7 billion in aid last year. This represents a decrease of 8.4% in real terms over the previous year. The fall was expected: ODA had been exceptionally high in 2005 (USD 107.1 billion) and 2006 (USD 104.4 billion) because of debt relief in Iraq and Nigeria.

How does this bode for donors keeping their promises with relation to key development goals? Overall, donors are not on track to meet their aid volume commitments, which the Gleneagles G8 summit in 2005 estimated would raise ODA from USD 80 billion in 2004 to USD 130 billion in 2010. On average, donors need to more than double the present rate of increase in their aid over the next three years to reach this target.

While there was an encouraging upsurge in bilateral aid to sub-Saharan Africa (an increase of 10% in 2007, excluding debt relief), donors still face a real challenge in doubling total aid to Africa by 2010, as foreseen at Gleneagles.

The first comprehensive survey of donors’ future spending plans to 2010 has been completed by the OECD and the results will be published early in May.

To view the data, click here

 Civil Society and Aid Effectiveness
http://www.oecd.org/dataoecd/59/10/39499103.pdf

FURTHER INFORMATION

UN-NGLS
 Gender Equality and Aid Effectiveness
http://www.un-ngls.org/site/article.php3?id_article=452

Human Rights Council
 Working Group on the Right to Development, 31 December 2007, Roberto Bissio
http://www2.ohchr.org/english/issues/development/docs/A-HRC-8-WG.2-TF-CRP7.doc

South Centre
 South Bulletin, Issue 7, 16 January 2008
http://www.southcentre.org/southbulletin/Issue7-16January.pdf

Advisory Group on Civil Society and Aid Effectiveness
 Final Report: International Forum on Civil Society and Aid Effectiveness (3-6 February, 2008)
http://www.un-ngls.org/site/IMG/pdf/FINAL_REPORT.pdf

Civil Society Papers on Aid Effectiveness

Making Aid Accountable and Effective
ActionAid, 2007
http://www.actionaid.org.uk/doc_lib/making_aid_accountable_and_effective.pdf

From Paris 2005 to Accra 2008: Will aid become more accountable and effective?
International CSO Steering Group
http://www.betteraid.org/downloads/FINAL%20CSO%20position%20paper%20for%20the%20Accra%20HLF-1.pdf

Reality Check: Paris Declaration: Towards Enhanced Aid Effectiveness?
The Reality of Aid; Prepared by the Canadian Council for International Cooperation (CCIC) and BOND (British Overseas NGOs for Development), January 2007
http://www.un-ngls.org/site/IMG/pdf/RC_Jan07_final.pdf

Turning the Tables: Aid and accountability under the Paris framework
European Network on Trade and Development (EURODAD), April 2008
http://www.eurodad.org/?id=2166

Paris Declaration Undermines Policy Space through Aid
Celine Tan, Third World Network, April 2008
http://www.twnside.org.sg/title2/finance/twninfofinance20080403.htm

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