Commitments made on 2010 aid volumes still not met collectively by 2011 Commitments on aid effectiveness only partially met. Progress towards meeting 2015 commitments must be accelerated and monitored.
Africa: African governments have committed to exercise effective leadership over their development policies and programmes, to strengthen public financial management and to be accountable for development results. These commitments were set out in the Paris Declaration on Aid Effectiveness (2005) and reaffirmed in the 2008 Accra Agenda for Action and the 2011 Busan Partnership for Effective Development Co-operation. Some countries have also made commitments to publish data to International Aid Transparency Initiative (IATI) standards.
Development partners: Development partners made a series of commitments in 2005 to increase development assistance by 2010 and (in the case of the EU) to further increases by 2015. In 2011, G-8 countries re-affirmed commitments on ODA and enhancing aid effectiveness. Some commitments were denominated in GDP. Adjusting for lower GNI in 2010, commitments translate into ODA to Africa of US$66 billion in 2010, and US$81 billion in 2015 (in 2011 prices and exchange rates). The latter figure assumes that those countries with no commitment for 2015 maintain ODA to Africa at the 2010 level, without further increase. The calculations were set out in Appendices, Box 1 in the 2011 report. Development partners also made a number of commitments in the Paris Declaration, the Accra Agenda for Action and the Busan Partnership to improve the effectiveness with which they provide aid, particularly in the areas of alignment to countries’ policies and systems, harmonisation of practices, transparency and predictability. They committed at Busan to accelerate their efforts to untie aid and will, in 2012, review their plans to achieve this. They also agreed to establish new indicators and targets by June 2012 for monitoring progress on a rolling basis. Emerging economies have accepted the Busan outcome document as a reference point for South-South co-operation. Twenty-eight signatories representing 80% of global Official Development Finance have signed the IATI. Commitments to increase lending by the International Finance Institutions (IFIs) were made in 2009 in response to the crisis. Other commitments include the development of innovative financing mechanisms. The Cannes G-20 Summit in November 2011 agreed that new sources of finance needed to be found to meet development needs and climate change (see Climate Finance).
What has been done to deliver on these commitments?
Africa: Most African governments have made progress in delivering their Paris/Accra commitments including strengthening the leadership of their development programmes. Thirteen countries (out of 29 for which data is available) have improved the quality of their national development strategies since 2005, and several have completed fully-costed MDG needs assessments. Many countries have accelerated and deepened public financial management reforms. But parliamentary oversight of national development strategies and civil society involvement remain limited.
Development partners: Aid volume commitments for 2010 were still not met collectively in 2011, although some individual partners have met their commitments. Total ODA increased to US$133.5 billion (2011 prices), an increase of US$53.5 billion over the 2004 level. Although an increase in nominal terms, this however represented a 2.7% drop in real terms compared to 2010, and was significantly below the 2010 level implied by 2005 commitments, of around US$159 billion in 2011 prices. Moreover, Africa received around 37% of the global increase since 2004, or around US$19.6 billion, compared to the 50% assumed in 2005.
On aid effectiveness, global progress was insufficient to meet most of the targets set in the Paris Declaration. According to the 2011 OECD Report on Progress in implementing the Paris Declaration, only one out of the 13 targets for which data was available was achieved in 2010 and by a narrow margin: the target for coordinated technical co-operation, which measures the extent to which donors provide aid in support of countries’ capacity development objectives.
Donors are using partner country public financial management and procurement systems more than in 2005, but not to the extent foreseen in the Paris Declaration. Donors are not systematically making greater use of country systems where these are more reliable. Survey data also show that donor performance has been particularly poor in African fragile states, potentially undermining limited government capacities. As of January 2012, 13 of the total 28 signatories are publishing data to IATI standards.
Donors have created three innovative financing mechanisms in the health sector including Advanced Market Commitments (AMCs) to support the development of vaccines, the International Finance Facility for Immunisation (IFFIm), and the UNITAID Solidarity Air Ticket Levy and carbon market mechanisms. Discussions continue on the introduction of a levy on financial transactions to support development among other objectives.
What results have been achieved?
On aid volume, ODA to Africa rose to US$50 billion in 2011 (equivalent to around US$40 billion in 2004 prices), compared to US$30.4 billion in 2004. This figure was still significantly below the 2010 level implied by 2005 commitments (around US$66 billion in 2011 prices). It represented around 70% of what Africa would have received had the commitments been met in full. In practice, Africa received only around half of the promised increase implied by the 2005 commitments. About half of the shortfall is due to lower global ODA compared to commitments; the other half is due to Africa’s lower-than-anticipated share of the global increase - about 37% instead of the 50% assumed in 2005. Africa’s share of global ODA has stayed between 23 and 40% since 2000 (excepting the temporary increases from exceptional debt relief).
On aid effectiveness, there are inevitable time-lags between improvements in aid delivery and final outcomes. There are also other factors - including domestic policy and development partners’ non aid policies - that influence final outcomes. At the same time, country evaluations indicate that where progress was made towards the Paris and Accra targets, it is likely to have led to improved aid effectiveness. Two-thirds of the 21 countries evaluated globally showed good evidence that efforts to improve aid effectiveness had led to a better contribution of aid to development outcomes in the health sector, for example. Since donors have only just begun to publish their aid information to IATI, it is too early to comment on results. IATI’s first annual report in 2012 will provide an overall analysis of the information that has been published to date. Innovative financing mechanisms had generated more than US$6 billion in the health sector by end-2010.
What are the future priority actions?