Making development assistance more transparent
By Donald Kaberuka
This week, an important global event is taking place in Busan, South Korea – The 4th High-Level Forum on Aid Effectiveness. The aim is to search for a new consensus on development cooperation. And it is fitting that the conference takes place in a country that was at one time aid dependent and now has graduated to a member of the G20.
At a time when the world economy is in crisis, and the very fundamentals of capitalism and markets are being called into question, overseas development aid may seem like a sideshow. On the other hand, the financial crisis presents a real opportunity for organisations and governments giving aid to ensure they do so in a way that delivers value for money. The High Level Forum is the moment for donors to act decisively and collectively to achieve this.
Taxpayers in developed countries facing the effects of dramatic austerity measures may, understandably, question the rationale for giving money to African countries or other developing nations. They will certainly be more inclined to demand strong fiduciary systems and evidence of impact. This is entirely understandable, and deserves a meaningful response.
For six years now, donor governments and multilateral agencies that disperse aid – including our own organisation – the African Development Bank – have been carrying out reforms to make aid more effective. Chief among these, an essential first step necessary to achieve many of the other aims, is making development assistance more transparent.
In spite of the commitment, the majority of organisations need to make faster progress in publishing timely, comprehensive, or comparable information about the development assistance they give. This fundamentally would strengthen their ability to coordinate efforts and reduce overlap, waste and inefficiency. It would show stronger evidence of where. development assistance is going, and with what effect, let alone what others are doing.
The phenomenon of aid ‘darlings’ and ‘orphans’ is driven by this lack of comparability. For example, a UN assessment in the Palestinian territories found that lots of money was being given to urban areas at the expense of the rural ones and refugee camps where there were significant unmet needs. And in the education sector, donors have focused their aid on primary education and neglected secondary and tertiary levels.
The lack of transparency matters for recipient governments too because it undermines their planning and reduces fiscal autonomy. A study carried out in 2008 by EURODAD found that donors were funding 265 different aid projects in Sierra Leone, many of which were being implemented unbeknownst to the government, which struggled to keep track of the competing initiatives. It is counterproductive when aid, designed to help a country develop, actually impedes its leaders’ ability to govern effectively and responsibly for their people.
Citizens are also disadvantaged by the absence of timely, comparable and accessible information about development assistance. Taxpayers in donor countries cannot be sure they are getting value for money. And citizens in developing countries are not able to hold their governments to account. Governance reform efforts and public trust in overseas development assistance would both be significantly boosted by the provision by donors of more and better information about what they’re giving, to whom, for what, and when.
An organisation that has been working hard on this agenda for a good few years now is Publish What You Fund. It has just produced its first pilot Aid Transparency Index, based on primary evidence gathered by Publish What You Fund and a number of other civil society organisations on the ground in donor countries. The index offers the first objective, evidence-based analysis of how well donors are doing at making their aid transparent. Overall the results are not heartening.
None of the 58 agencies surveyed made it into the ranking’s top category ‘good.’ Only nine agencies achieved a score of over 60 percent, earning the classification ‘fair.’ The African Development Bank was one of these, with a score of 67 percent, after the World Bank and the Global Fund to fight AIDS, Tuberculosis and Malaria. The average score was 34 percent, demonstrating how much more donors need to do collectively to increase the transparency – and thus the potential effectiveness – of their development assistance.
We have joined the International Aid Transparency Initiative (IATI) – a common standard for publishing data that has the potential to transform the way aid is managed. To improve our score, we shall ensure that our current online project database is compatible with IATI so that we can begin publishing our data to the IATI Register. This will make it easy to compare directly with other countries’ contributions. We intend to complete this by early next year.
At the High Level Forum on Aid Effectiveness in Busan, where the future of the whole aid effectiveness agenda is at stake, all donors need to redouble their efforts to publish more and better information about the development assistance they give. Of particular relevance here are the more established and bigger donors whose joining of this initiative would significantly strengthen its potential. Making development assistance transparent is not hard to do, and international cooperation could be all the stronger for it. Ultimately, a successful development assistance programme is the one which enables the recipient country to graduate, as the host, South Korea has done from aid dependency to trade and a global market for capital.
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- Environmental Assessment Meeting: Milestone for Paris Declaration and Accra Agenda for Action
- Second Regional Meeting on Aid Effectiveness - Participants Reactions
- Africa Should Reduce Aid-Dependency and Explore Alternative Sources of Development Finance – AfDB President Donald Kaberuka
- AfDB Advocates Strong, Sustained and Shared Growth in Africa