Is aid development? Development is happening, and important advances have been made. But can we attribute this to aid? In part, certainly. But official development assistance (ODA) provided by OECD-DAC member governments to developing country governments, is often expected to “solve” development. While much has been done to increase the impact of these funds, it is important to look at them in context.
charge of how aid is managed and spent. Many aid recipients are becoming donors. But finding clear, long-term evidence of a causal link from aid to development is challenging. It may be easier to judge the benefits in terms of potential savings. The European Commission estimates that failing to implement the full aid effectiveness agenda costs its aid programme €5 to 7 billion a year.
ODA reached a record high in 2010. Nonetheless, the share of aid in overall development finance is shrinking. Remittances, foreign direct investment, trade and domestic revenues play fundamental roles. And flows from beyond the providers of ODA – foundations, churches, non-DAC donors or others – are rising.
Even so, many question whether aid is a good thing and often cite corruption. But the cure is not avoidance. Systems of checks and balances, for instance strengthening the role of parliaments and media, are fundamental. This also means emphasising transparency and predictability of funding to enhance accountability. It is also important to combat illicit flows and corruption in rich countries.
At the same time, development co-operation models are multiplying. This is why the Fourth High Level Forum on Aid Effectiveness (Busan, Korea, 2011) did more than take stock of the implementation of the quality of aid; it focused on recommending a quality framework for all development finance. In 2005, the Paris Declaration on Aid Effectiveness set out a series of principles to make aid work better. Today, we know that these principles work not only for aid, but for all development resources. We also know that developing countries are increasingly taking
“Corruption is a scourge that undermines the effectiveness of aid and throws barriers in the way of the political and economic changes that are fundamental to development. It steals away the resources intended to alleviate the suffering of the poorest.” Huguette Labelle, Chair of Transparency International, OECD/ADB 9th Regional Seminar: Political Economy of Corruption, Manila, 2009
Finally, people increasingly ask why we should give to others when we have enough problems at home. The answer is that we can no longer look at development as somebody else’s problem. In our highly interdependent world, what happens with the economy, security, climate and health of any country affects us all. Brenda Killen is the head of the Aid Quality and Architecture Division in the OECD Development Co-operation Directorate
“In Africa in the past decade 18 non-oil exporting countries grew at an average of 5.5% per year … But they could not have done this without debt cancellation and aid.” Jamie Drummond, ONE International, “Making the Case for Overseas Aid”, The Huffington Post, 15 July 2011 www.huffingtonpost.co.uk
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OECD Yearbook 2012 © OECD 2012
2012 OECD Yearbook