The ONE DATA report 2012

Acknowledgements

We would primarily like to thank ONE's board members and trusted advisors: Bono, Josh Bolten, Howie Buffett, Susie Buffett, Joe Cerrell, John Doerr, Jamie Drummond, Michael Elliott, Tom Freston, Helene Gayle, Mort Halperin, Mo Ibrahim, Ngozi Okonjo-Iweala, Jeff Raikes, Kevin Sheekey and Bobby Shriver, as well as ONE's Africa Policy Advisory Board members: Charles Abugre Akelyira, Dr. Melvin Ayogu, Amadour Mahtar Ba, Owen Barder, David Barnard, Erik Charas, Paul Collier, Eleni Z. Gabre-Madhin, Neville Gabriel, John Githongo, Angelique Kidjo, Acha Leke, Dr. Xiaoyun Li, Dr. Richard Mkandawire, Archbishop Njongonkulu Ndugane, Ory Okolloh, Arunma Oteh, Rakesh R. Rajani, Mandla Sibeko, John Ulanga and Russell Wildeman. We are grateful to ONE's friend and advisor Bob Geldof and our distinguished International Patron, Archbishop Desmond Tutu, for their support and guidance.

We are fortunate to have received comments and feedback on previous drafts of this report from partners in the NGO community and in government. They have all strengthened the report, and any remaining errors are our sole responsibility. We are grateful to be able to draw on this strong group of stakeholders as well as many other friends and colleagues around the world who have advised ONE on this report and in all that we do. The statisticians at OECD's Development Assistance Committee provided the data which made this report possible. The team at Development Initiatives, led by Judith Randel, Daniel Coppard, Daniele Malerba and Asma Zubairi were tireless in their efforts to assist with data analysis and overall guidance. Thanks to our faithful copy-editor, David Wilson. The report's design and art direction were guided by the talents of Andrea Hubbard and ONE's designer, Elizabeth Brady. Many thanks to the Absolute Group for the sustainable printing and production of this report.

The following ONE staff and consultants contributed significantly to the policy content of this report: Nora Coghlan, Guillaume Grosso, Tamira Gunzburg, Alan Hudson, Andreas Huebers, Tobias Kahler, Lauren Pfeifer, Joseph Powell, Friederike Röder, Johanna Stratmann, Ross Thuotte, Eloise Todd, Alexander Woollcombe and Jennifer Wynn. The writing and production of this report were led by Caitlyn Hendrickson, Ben Leo and Sara Messer.

To the millions of people who work and campaign tirelessly every day to make poverty history in Africa, thank you. The perseverance and commitment of those working both inside and outside governments is truly inspiring.

Introduction

With just over three more years to meet the Millennium Development Goals (MDGs), much progress has been made. Yet much remains to be done. World leaders, NGOs, academics and other development institutions are already moving beyond the world's existing goals and increasingly focusing on the post-2015 agenda. However, as the world scrambles to define a new global development framework, we cannot lose focus on the existing development targets. Sub-Saharan Africa has made tremendous breakthroughs in fighting poverty and disease, thanks to steady economic growth combined with targeted development investment. But many countries still lack the resources, capacity and conditions they need to provide basic services to their citizens. Sustained momentum and focus will be critical over the next three years to reach global targets.

Since its inception, the DATA Report has held the world's wealthiest countries accountable for their commitments to the world's poorest countries. For the past six years, it has tracked progress against the Gleneagles commitments made by the G7 in 2005. However, with those commitments expiring in 2010, key donors such as the United States, Canada and Japan no longer have overall official development assistance (ODA) targets. For their part, the G20, despite their growing significance on the world stage, have not presented clear and measurable targets in development finance to which member countries can be held to account. So in 2012, the DATA Report turns its principal attention to the European Union (EU) and its bold commitments to continue increasing development assistance up to 2015. This year, the DATA Report monitors EU commitments to reach a target of 0.7% of gross national income to be provided as official development assistance (ODA/GNI) by 2015 and to provide half of its ODA increases to Africa. It examines progress by the EU towards reaching intermediate targets in 2010, and forecasts the increases required to meet individual country and collective EU targets by 2015.

Specifically, the report profiles the 15 EU states who were members of the Union prior to 2004 (the EU15), providing detailed analysis of their progress on individual global and Africa targets, as well as policy reforms. As in past years, the 2012 DATA Report focuses special attention on development assistance to Africa. Although the Gleneagles commitments provided a unique focus on sub-Saharan Africa, the EU made promises to the continent as a whole, and was not clear about the proportion of increases earmarked specifically for the sub-Saharan region. As EU countries strive to maintain development funding and to maximise results delivered from scarce resources, ONE urges the EU to channel resources to those developing countries with the greatest need and the longest way to go to achieve the MDGs.

In addition to assessing EU Member States, this year's report also looks at development assistance channelled through the EU institutions. We are in a pivotal year as Member States negotiate the EU's next seven-year budget, spanning the 2014–20 period. Approximately €51 billion in development funding is up for grabs. To achieve this goal, Member States must exhibit unparalleled political courage and strategic vision. The DATA Report explores how the EU's development budget complements the efforts of Member States, while helping them to reach their 0.7% targets.

The 2012 DATA Report continues to monitor commitments to the quality of aid, as well as its quantity. This year it presents a new assessment utilising the Brookings Institution's and the Center for Global Development's Quality of Official Development Assistance (QuODA) index. While new indicators from the Fourth High Level Forum on Aid Effectiveness are being decided in June 2012, the QuODA analysis is a tool to measure prior aid effectiveness commitments alongside more general aid quality standards.

Although this report maintains a focus on ODA, ONE recognises that aid alone is not a silver bullet. Many other forms of financing, managed through transparent and accountable institutions, are crucial for developing countries. These include domestically generated resources, foreign direct investment, trade, remittances and private flows. ONE looks forward to the 'Investments to End Poverty' report due to be released later this year by the Bill & Melinda Gates Foundation, which will track all forms of development finance. The lack of comparable, measurable commitments across countries concerning these other financial flows makes it difficult to apply the same accountability standards that the DATA Report uses to track progress on aid commitments. That said, ONE hopes to profile both non-aid financing flows and the results they achieve in future reports.

Of course, the most critical contributions to development come from within developing countries themselves. Subsequent ONE publications this year will monitor financing for agriculture and food security and commitments to HIV/AIDS prevention and treatment, including analysis of African pledges. In this context, ONE is grateful for the work done by the Africa Progress Panel, the Africa Monitor and the United Nations Economic Commission for Africa, among others. These organisations hold African governments accountable for promises made to their citizens on improving development outcomes. ONE looks forward to partnering with these groups in future analyses of African commitments.

Executive Summary

The past decade was one of unprecedented growth for sub-Saharan Africa, while the next decade holds both extraordinary opportunities and challenges. From 2000 to 2010, development assistance to sub-Saharan Africa increased by over €14.71 billion.¹

Most of that (62.7%) was related to the Gleneagles commitment period between 2005 and 2010. During the same time, regional economic growth averaged between 4% and 7% (except for 2009)² and Africa was home to six of the world's ten fastest-growing economies.³ Sub-Saharan Africa's advance in development indicators during that period matched its impressive economic track record:

46.5 million more children enrolled in primary school;

Agricultural production in 17 sub-Saharan countries increased by more than 50%;

More than 5 million HIV-positive people gained access to antiretroviral treatment; and

Twelve sub-Saharan African countries saw child mortality rates decrease by over 4.3% a year (the rate of decline that is needed to meet the Millennium Development Goal) and three countries – Senegal, Rwanda and Kenya – have seen falls of more than 8% a year.⁴

Due to this strong growth, several sub-Saharan African countries have now graduated to middle-income status, and many more could join them over the coming decade.⁵ For these latter countries, 'smart' aid coupled with accountable domestic investments will help to protect progress already achieved and accelerate further progress. During this interim period, many countries still face significant investment requirements in infrastructure, health, education, agriculture and other drivers of near- and long-term growth. If these are met through a combination of development finance sources, including aid flows, then these countries could graduate from external assistance altogether in the not too distant future. As such, we could be near the beginning of the end of the aid relationship. Demonstrable progress and real achievements are within grasp for African citizens, their governments and the international community. The donor community, particularly EU Member States, need to maintain the current course and meet existing commitments to ensure that this possibility is achieved, because smart aid still plays an essential catalytic role in economic development.

While the prospects for an increasing number of African countries are promising, another group of nations remain mired in fragility or are recently emerging from destructive civil conflicts. In these environments, the need for focused external support will remain for many years. Such assistance, if provided through targeted and outcome-based approaches, can play a critical role in saving lives, rebuilding institutions, expanding public infrastructure, improving delivery of social services and helping to establish a solid foundation for future growth and economic opportunities.

The Gleneagles commitments, which expired in 2010, mobilised political will and rallied resources from some of the world's wealthiest economies to support these African achievements over the past seven years. Yet despite the historic increases in official development assistance (ODA) from some nations, other donor governments still fell short of their promised increases to sub-Saharan Africa. And in 2012, the momentum for development assistance has stalled. Despite impressive advances, many of the poorest countries are still struggling to meet the Millennium Development Goals (MDGs), with just three-and-a-half years to go before the deadline at the end of 2015. Simply put, much work remains. And for the first time in over a decade, global levels of development assistance witnessed a decline in 2011.

Though some non-European donors such as Australia and South Korea have pledged to increase development assistance, major donors like Canada, the United States and Japan did not set overall ODA targets beyond 2010. The European Union (EU) represents the only group of countries that have ongoing collective targets to increase development assistance. These countries committed to increase ODA as a percentage of gross national income (ODA/GNI) to 0.7% by 2015 and to provide 50% of all increases to Africa.

They also promised to increase ODA to sub-Saharan Africa, though with no specific target, and they committed to provide between 0.15% and 0.2% ODA/GNI to least developed countries (LDCs) by 2010. Europe's leadership could not come at a more critical time to help protect and advance the gains that have been made in the developing world. With such progress already achieved, but with gains still fragile, now would be the worst time to retreat from international responsibilities and strategic and moral imperatives.

In line with the DATA Report's mission of holding governments accountable for their commitments, the 2012 DATA Report assesses Europe's progress in keeping its ambitious promises for aid increases and aid effectiveness. As ONE devises better means to track and monitor African government commitments and other financial flows, the DATA Report will evolve to measure development financing more broadly, and will strive to evaluate not just inputs but also the significant outcomes in alleviating poverty, hunger and preventable disease.

The path to these targets will not be easy. Europe's protracted economic crisis has created a multitude of challenges at home, ranging from high unemployment rates to unsustainable fiscal deficits. In response, an increasing number of countries have implemented sharp cuts or have flatlined budgets for the coming years. This growing budget austerity has now spilled over into life-saving aid programmes. But while the road has been politically rough, it is not impassable. Four EU countries already provide more than 0.7% ODA/GNI (Luxembourg, Denmark, Sweden, the Netherlands) – and the Netherlands has recently taken the brave decision to maintain its investment in aid despite a severe domestic budget squeeze. The United Kingdom has shown impressive leadership and remarkable political courage through its efforts to achieve the 0.7% target. Ireland too remains committed despite exceptionally tough times. Significantly, these countries respectively hold the G8 and EU Presidencies from January 2013.

As economic growth has declined, so too has the overall volume required to meet European aid commitments. Despite these downwardly adjusted requirements, only four of the EU15 Member States continued to make ODA increases in 2011. Published budget projections by the European Commission (EC) foresee further cuts by many countries this year. As the EU has met only 22.5% of the collective target increases promised to the African continent by 2015, it will take bold political leadership to press ahead with continued increases during tough economic times. Yet these are the times when national reputations, international goodwill and long-lasting relationships are forged. As the EU negotiates its next seven-year budget for the 2014–20 period, there is a unique opportunity for Member States to support the €51 billion⁶ earmarked for development assistance and in the process make further progress towards their 0.7% promises.

However, we know that aid alone is not enough. Domestic tax revenues are ten times higher than ODA on the African continent.⁷ Total foreign direct investment (FDI) to Africa increased over 300% from 2000 to 2008, to €51 billion.⁸ While FDI declined between 2008 and 2010 due to the global financial crisis, the IMF projects a return to robust investment levels in the future.⁹ Remittances, trade and private philanthropic flows all play growing development finance roles and support opportunities for countries to break free of the cycle of poverty. It will require a combination of all these resources together with effective developing country leadership, managed through transparent and accountable budgeting and expenditure systems, to achieve the gains necessary to eventually beat extreme poverty and move beyond aid. While domestic revenues represent the future, aid will play an important role in making this a reality. Smart aid can help build the capacity of governments to improve domestic resource collection and fight corruption, and can also help to catalyse private investment, thus building the long-term conditions for when external assistance is no longer required. This is close to realisation in a growing number of countries. But we are not there yet.

Key findings

Figure 1: Share of Global ODA in 2011

Europe Continues to Lead the Way on Development Assistance Commitments

The EU is the only group of countries (along with Norway) to have set deadlines for achieving the UN's 0.7% ODA/GNI target. Overall, the EU provides more than half of global ODA (54.1% in 2011, from EU donors and non-EU Development Assistance Committee (DAC) donors)¹⁰. From 2004 to 2011, the EU increased its ODA/GNI by a tenth of a percentage point, from 0.3% to 0.4%, equivalent to €17.1 billion.¹¹ The EU's 2011 ODA/GNI of 0.4% in 2011 was much higher than the DAC average (0.3%) and that of the US (0.2%), Japan (0.17%) and Canada (0.31%).

Despite Significant Increases, the EU has Fallen Short of its Past Targets, and in 2011 its Global ODA Actually Declined for the First Time Since 2002

The EU collectively agreed to an interim target of 0.56% of ODA/GNI by 2010, on the way to achieving 0.7% by 2015. However, Member States collectively achieved only 0.42% by 2010, leaving a shortfall of €18 billion.¹² While seven countries had met or exceeded their individual interim targets by 2010 – the United Kingdom, Denmark, Finland, Ireland, Luxembourg, Cyprus and Malta – other countries remained far off the mark. Germany and Italy together accounted for over €9 billion, or roughly half, of the total volume deficit, although both countries did deliver modest aid increases in 2011. France and Spain accounted for another €3 billion in unfulfilled promises. In fact, 14 of the EU Member States actually decreased their ODA from 2010 to 2011. Those countries that managed to protect their aid budgets and even to continue increases during tough economic times should be commended.

The EU's Commitment to Africa is Slipping

Although Europe's performance on existing global aid promises has been mixed, its collective track record towards meeting its targets for Africa has been worse. While Gleneagles placed a special emphasis on sub-Saharan Africa, the EU commitments include an explicit target of channelling 50% of global ODA increases to the African continent as a whole (including North Africa and sub-Saharan Africa)¹³. Between 2004 and 2010, the EU15 increased ODA to Africa by only €5.04 billion, far short of their target increase of €15.58 billion. Denmark, Ireland and Luxembourg were the only countries to meet their individual Africa increase targets. Comparatively, the EU has actually performed worse than the rest of the DAC in terms of the proportion of ODA increases directed to Africa. From 2004 to 2011, the EU15 provided 36.2% of global ODA increases to Africa, and 33.8% went to sub-Saharan Africa specifically, whereas the non-European members of the DAC provided 55.8% of global ODA increases to the continent.

While the EU technically did meet its commitment to increase ODA to sub-Saharan Africa, there was no clear target set (unlike for Africa as a whole). In addition, the EU just missed the lower end of its commitment to provide 0.15% ODA/GNI to LDCs by 2010 (at 0.14%). As aid budgets continue to tighten, it will be crucial to monitor whether the EU maintains a focus on sub-Saharan Africa and those countries most in need.

Figure 2: EU15 2010 and 2015 Africa Targets

Meeting Commitments by 2015 Will Require Unprecedented Increases

From 2011 to 2015, the EU will need to increase ODA globally by €42.93 billion to meet its overall target of €93.78 billion. In 2011, it achieved only 54.2% of its collective 2015 target, falling further behind than in 2010. As the debt crisis spreads across the region, Member States will likely continue measures of budget austerity, making it more challenging than ever to protect development assistance funding and to continue steady increases – including in the budget negotiations for the next EU development budget. But in the final push on the MDGs, fulfilling these promises, along with pursuing smart, coordinated policies, will be crucial to help poor countries meet their ambitious development targets. In order to achieve their targets, Member States who do not already have detailed timelines in place should develop roadmaps covering the next three years.

Decisive action by policy-makers can put countries back on track towards meeting their goals. In looking across the EU27, countries can be grouped according to their distance from their individual global ODA targets:¹⁴

Countries that met more than 75% of their 2015 global ODA target in 2011 – Denmark, Luxembourg,
the Netherlands and Sweden;

Countries that met between 50% and 75% of their 2015 global ODA target in 2011 – Belgium, Finland, France, Germany, Ireland, the United Kingdom and Malta;

Countries that met between 25% and 50% of their 2015 global ODA target in 2011 – Austria, Portugal, Spain, Bulgaria, Cyprus, Czech Republic, Estonia, Hungary, Lithuania, Romania and Slovenia;

Countries that met less than 25% of their 2015 global ODA target in 2011 – Slovak Republic, Italy, Poland, Latvia
and Greece.

For Africa targets, the EU15 will need to increase ODA by €20.62 billion between 2011 and 2015. Thus far, they have met only 22.5% of the target increases they have promised to Africa between 2004 and 2015, which can be broken down as follows¹⁵:

Countries that have met more than 75% of their promised 2015 increases to Africa – none;

Countries that have met between 50% and 75% of their promised 2015 increases to Africa – Belgium,
Luxembourg, Sweden and the United Kingdom;

Countries that have met between 25% and 50% of their promised 2015 increases to Africa – Denmark, Finland, Ireland
and Portugal;

Countries that have met less than 25% of their promised 2015 increases to Africa – Austria, France, Germany, Greece, Italy, the Netherlands and Spain.

Figure 3: EU15 Progress Towards 2015 Targets in 2011

Note: EU12 data on ODA to Africa are not yet available for 2011, and data for prior years are incomplete. The Netherlands is not included as it has made negative progress on Africa targets and falls outside the range of the graph.

The EU's Next Seven-Year Budget is a Critical Opportunity to Increase Development Assistance

Development assistance channelled through the EU institutions plays a key role in the global fight against extreme poverty. Thanks to EU aid, between 2004 and 2009 more than five million children were vaccinated against measles and more than nine million children had a chance to go to school. Moreover, supporting the €51 billion of development assistance proposed in the EU's next Multi-Annual Financial Framework (MFF) and 11th European Development Fund (2014–20) will be critical for increasing overall levels of European development assistance and helping Member States to meet their individual targets. In 2011, Member States channelled an average of 21.5% ¹⁶ of all ODA through EU institutions. This development assistance counts towards Member States' individual targets, but the EU institutions also coordinate European development assistance to achieve shared goals and to support developing countries where individual Member States may not have separate programmes. And while more can be done, EU aid quality has significantly improved over the past decade, making the EU institutions today a global leader in aid effectiveness and transparency.

Transparency and Accountability are Crucial for Achieving Impact with Scarce Resources

As governments continue to face resource constraints, many countries are increasingly under pressure to demonstrate the value of development investments, thereby making progress in aid effectiveness even more imperative. A number of European donors – such as the UK, Ireland, Sweden and the EU institutions – are leading the way on aid effectiveness. Other donors have a long way to go and must increase efforts to meet their commitments to improve aid quality and better utilise scarce resources.

To advance progress, all providers of development assistance, as well as recipients, can make strides to improve the transparency and accountability of development financing. Donors should publish development assistance information in a timely, comprehensive and comparable manner, in line with International Aid Transparency Initiative (IATI)standards. Currently, only eight of the EU15 and the EU institutions are signatories to IATI. Together, they cover 21% of global official development finance flows.¹⁷ For their part, developing countries should improve budget transparency by publishing information and involving citizens at all stages of the budget process, ensuring citizen participation and buy-in down to the local level. There should also be greater transparency and accountability in the governance of natural resources, so that citizens can hold their governments accountable for the use of national oil and mineral wealth. Better harnessing revenues from these sources can help to increase government support for other sectors such as health, agriculture and food security.

Key decisions this year will set the stage for progress going forward. Last year, governments recommitted to aid effectiveness principles in Busan and made new pledges on aid transparency, accountability in managing public resources and country-led results monitoring. Countries should work to translate these agreements into clear, results-oriented commitments that can be monitored on a yearly basis. Moreover, the EU has a key opportunity this year to finalise a law that requires extractives companies to report the payments they make to governments in countries in which they operate. If adopted, this will be groundbreaking legislation that has the potential to shine a light on important financial flows and help to ensure that more resources are invested in life-saving interventions.

Figure 4: Leading and Lagging Member States on Aid Quality Dimensions, as Assessed by QuODA

Note: Rankings are assessed out of 31 donor countries and organisations analysed by QuODA.

Executive Summary Notes

All of ONE’s calculations are in 2011 constant prices and exclude debt relief.

IMF, World Economic Outlook Database. April 2012.

IMF; The Economist analysis.

Gabriel Demombynes and Sofia Karina Trommlerova. ‘What Has Driven the Decline of Infant Mortality in Kenya?’ World Bank, Policy Research Working Paper. 1 May 2012.

Todd Moss and Benjamin Leo. 2011. ‘IDA at 65: Heading Toward Retirement or a Fragile Lease on Life?’. Center for Global Development, Working Paper 246. March 2011.

This includes funding to the 11th European Development Fund combined with the Development Cooperation Instrument of the Multi-Annual Financial Framework.

Although this varies widely from country to country. DEV Working Paper N° 306: ‘Revisiting MDG Cost Estimates from a Domestic Resource Mobilisation Perspective’. OECD Development   Centre. December 2011.

UNCTAD. Regional Investment Trends. 2010.

IMF. Regional Economic Outlook: Sub-Saharan Africa. April 2011.

The 15 original Member States of the EU are also members of the OECD Development Assistance Committee (DAC), which tracks aid volumes and statistics. The 12 Member States of the EU that acceded after 2004 are not members of the DAC, but their aid volumes are included in the overall calculation.

2004 volumes have been smoothed for the EU15.

These are ODA levels excluding debt relief. For EU12 ODA levels, it is assumed that debt relief figures will be negligible.

When monitoring Africa commitments, the DATA Report looks at the 15 Member States of the European Union (EU15) who are also members of the DAC. The 12 EU Member States who acceded to the Union after 2005 do not report regional ODA to the DAC for 2011 and data for prior years is spotty.

See reference tables for individual percentages.

See Figure 9 in Development Assistance chapter for individual percentages.

Taking into account the EU15 and nine of the EU12 (no data are available for Bulgaria, Malta or Latvia). For Cyprus, Lithuania and Romania, this refers to 2010 data.

Official development finance includes ODA plus other official flows (OOF). Based on 2009/2010 OECD DAC reported information on commitments of ODA and OOF (in current prices).

Development Assistance

While the G8's Gleneagles commitments for increasing ODA ended in 2010, EU Member States have committed to meet 0.7% ODA/GNI collectively by 2015, adding up to a potential €93.78 billion in ODA. Meeting these targets will be critical to accelerating development progress, alongside sound policies, government investments and private capital, in those countries that are furthest behind on meeting the MDGs. This is especially the case for many countries in sub-Saharan Africa, where the EU is not clear about the proportion of assistance intended for the region (EU commitments are for the African continent overall).

This chapter examines the EU's progress in meeting its individual and collective commitments thus far, both globally and to Africa.

It also presents projections for the increases in development assistance needed to reach 2015 targets. Over the coming 18 months, the next seven-year budget for the EU is being negotiated (2014–20), with overall budget levels being decided by the end of 2012. It is critical that Member States support the full proposal on development assistance within the overall budget to help achieve collective targets.

What Were the EU Commitments?

In 2002, world leaders of both developed and developing countries gathered at the United Nations International Conference on Financing for Development in Monterrey, Mexico to lay out a shared, global agenda for development cooperation. This agenda included a number of clear commitments from developed countries, such as increased aid, deeper debt relief and enhanced trade access, while developing countries committed to expand domestic resources for development and to fight corruption. The Monterrey Consensus reiterated the UN's 0.7% ODA/GNI target as an aspirational goal for donor countries. As their contribution to the Monterrey Conference, the EU Member States agreed on eight 'Barcelona Commitments' at the European Council meetings that same year. Those commitments included pledges on both volume and effectiveness of development assistance. The 15 Member States at the time agreed to increase development assistance, relative to gross national income (GNI), to reach an individual target of 0.33% ODA/GNI by 2006,¹ contributing to a collective target of 0.39% ODA/GNI and on the way to reaching 0.7%.

In 2005, the European Council further agreed to reach the 0.7% ODA/GNI target by 2015 and also set additional interim targets for Member States. The Council agreed that the original EU15 which signed on to the Barcelona Commitments should reach an individual target of 0.51% ODA/GNI by 2010. For those Member States that joined after 2002, an individual target was set at 0.17% ODA/GNI (on the way to a target of 0.33% ODA/GNI by 2015). Including those Member States which had already exceeded 0.7% at the time, the collective EU27 target for 2010 was thus set at 0.56% ODA/GNI, while the collective 2015 target was set at 0.7% ODA/GNI.

Three EU countries have individual targets that exceed 0.7% ODA/GNI. Denmark has committed to an ongoing target of 0.8%. Luxembourg and Sweden have targets of 1.0% ODA/GNI. The Netherlands previously had a target of 0.8%, but, in 2010 the Dutch government announced a reduced target of 0.7% ODA/GNI.

Delivering Development Assistance

Official development assistance (ODA) is a standard definition of what donors can count as development assistance for developing countries, as defined by the OECD Development Assistance Committee (DAC). This definition is agreed upon by all 24 members of the DAC (including the European Union) and allows both a fair comparison of donors and assurance that their respective investments are used for development purposes.

The 2012 DATA Report monitors ODA in constant 2011 euros. This helps provide a universal, cross-donor reference point and ensures that the commitments made in 2002 and 2005 are not eroded by inflation. The figures in this report are also net of bilateral debt relief. While debt relief is immensely valuable and frees up domestic government expenditures that would otherwise go to debt service payments, the rules for counting bilateral debt cancellation as ODA (which are set by donors themselves) overstate both the value of debt relief and what the donor has to pay to provide it.² As pointed out in previous reports, debt relief can provide an artificial boost to ODA in some years. There is a significant time lag in the reporting of ODA data. While this report can only evaluate preliminary 2011 ODA data, the budgets that will determine spending in 2012 and even 2013 will either have been agreed or are in the process of being agreed now. In order to assess donors' performance using the most current information, ONE recognises that the DATA Report should include development assistance actions taken in the current calendar year. Unfortunately, no source exists that evaluates donors' future spending plans with a standard methodology. The April 2012 EC publication on preliminary data on ODA in 2011³ provides forecasts on what all EU27 Member States will disburse in total ODA levels in 2012. These are based on estimates that have been provided by Member States and, where these are lacking, simulations by the European Commission (EC). Future ODA projections, however, are inclusive of debt relief and so, for any increases in ODA levels between 2011 and 2012 referencing the EC, it has not been possible to assess future levels of aid exclusive of debt relief in line with the methodology employed by ONE. When calculating future targets, ONE uses published projections of GNI by the OECD to estimate the target volume of ODA in 2015.

Figure 1: EU27 Global ODA Targets, 2010 and 2015

Progress in Meeting 2010 Interim Targets

If the EU27 countries had met their interim collective ODA target of 0.56% in 2010, they would have provided a total of €69.62 billion.⁴ This compares with €33.76 billion provided in 2004. However, the EU Member States fell far short of this commitment, providing €51.62 billion in ODA in 2010, and reaching only 0.42% ODA/GNI. Over the 2004–10 period, the EU27 increased development assistance by 52.9%.⁵

Despite this collective shortfall, there were several areas of encouraging progress. Seven countries actually exceeded their 2010 interim targets: the United Kingdom, Denmark, Finland, Ireland, Luxembourg, Cyprus and Malta. However, other countries faltered.

In terms of percentage of GNI, the countries furthest from their individual targets were Italy, Greece, Austria and Portugal. The donors with the largest shortfalls compared with their individual interim targets, in volume terms, were Germany (€3.25 billion) and Italy (€5.78 billion). These two countries accounted for over half of the total shortfall on the collective EU27 0.56% target.

Figure 2: EU27 Global ODA/GNI in 2010, Actual versus Individual Country Targets

Measuring Results

Traditionally, donors have measured their development contributions based on inputs. This is how progress is tracked and commitments are monitored, as ONE has done year by year based on donors reporting to the DAC. However, world leaders have increasingly incorporated results-oriented commitments into international development agreements. For example, the 2005 Gleneagles communiqué included underlying G8 objectives for doubling aid to sub-Saharan Africa, such as universal primary education and access to antiretroviral treatment for HIV/AIDS. Without clear interim targets or individual parties responsible for achieving the goals, it has been difficult to hold individual donors accountable for fulfilling these commitments (a challenge that the DATA Report has faced each year).

In recent years, this has started to change as donors have increasingly set individual targets, particularly for education, health and agriculture. For example, many commitments related to the L'Aquila Food Security Initiative and the Muskoka Initiative on Maternal, Newborn and Child Health included numerical targets for people lifted out of poverty and deaths averted amongst pregnant mothers and children. These results-oriented commitments have helped to shift focus from inputs to the impact of development programming and have helped to foster a discussion about how to design programmes in ways that deliver maximum results. Yet, challenges to ensuring delivery on these commitments remain.

Monitoring is hindered by a lack of reliable, timely and complete data. This is especially difficult in sub-Saharan African countries where statistical capacity is often limited. In response to these limitations, countries are increasing their capacities to monitor and publish the results of their development assistance programmes. In this context, donor countries' monitoring and evaluation policies and commitments to publishing evaluation results are important aid quality indicators. For instance, Sweden's independent evaluation unit, the Swedish Agency for Development Evaluation (SADEV), has made great strides in tracking and assessing the operations of Sida, the Swedish International Development Cooperation Agency. To promote transparency and accountability, SADEV maintains a comprehensive database with information on every Sida development project.⁶

Given the current challenges of monitoring these new results-based commitments and the lack of comparable commitments across donors, this report continues to focus on donors' commitments to deliver development assistance, with the hope that future reports will be able to focus more on results.

From 2010 to 2011

In 2011, budgetary austerity measures triggered by the European debt crisis began to have an effect on the aid levels of EU Member States, with ODA decreasing for the first time since 2002.⁷ Fourteen of the 27 Member States actually reduced their ODA between 2010 and 2011, dropping the collective ODA/GNI level from 0.42% to 0.4%.⁸ The countries that reduced development assistance by the largest proportion were Greece (-39.3%), Spain (-29.2%) and Cyprus (-32.5%). Surprisingly Italy, one of the European countries suffering from the highest levels of debt, actually increased its ODA by 24.5% in 2011. Belgium, Germany and Sweden were the only other EU15 countries to increase ODA. However, the majority of the EU12 accession states increased their ODA from 2010 to 2011, with Malta, Lithuania and Romania all increasing development assistance by more than 20%.

Figure 3: Change in Global ODA Volumes, 2010–11 (€ Millions)

Increases Needed to Meet 2015 Global Targets

As a whole, the EU27 will need to increase total development assistance by an additional €42.93 billion between 2011 and 2015 to reach the collective EU ODA target of €93.78 billion.⁹ Five countries are on track to reach their 2015 targets (Luxembourg, Sweden, Denmark, the Netherlands and the United Kingdom). The EU15 countries that were furthest away from meeting their 2010 interim targets are also those which now have the furthest to go, proportionally, in meeting their individual 2015 targets – Greece, Italy, Austria, Spain and Portugal.

The majority of the EU12, with the notable exceptions of Cyprus and Malta, are also significantly off track to meet their 2015 targets. Cyprus had exceeded its 2010 target before significantly reducing development assistance in 2011. Four large economies – Germany, France, Italy and Spain – account for almost 70% of the combined gap in absolute volume terms. For the EU to meet its collective targets, it is critical that these countries scale up development assistance volumes in the coming four years.

Figure 4: % of 2015 Global ODA Target Met in 2011

EU Commitments to Africa

While the Gleneagles commitments emphasised increased development assistance to sub-Saharan Africa, the EU made commitments for 2015 for the entire African continent (North and sub-Saharan Africa). In 2005, when the EU outlined interim 2010 global targets for ODA and agreed on reaching 0.7% ODA/GNI by 2015, it committed to provide 50% of the ODA increases to the African continent, compared with 2004 baseline levels. Member States also agreed to increase ODA to sub-Saharan Africa, but without a specific target. In this report, ONE monitors progress by the EU15 towards meeting their commitments to increased Africa ODA flows.¹⁰

Proportion of Development Assistance Directed to Africa

Looking at 2010 interim targets, the EU fell far short of its commitment to provide 50% of global ODA increases to Africa. In 2010, the EU15 should have provided an additional €15.58 billion in ODA increases to Africa. However, it actually only provided €5.04 billion additional in comparison with 2004 levels. Between 2004 and 2011, the EU15 provided 36.2% of global ODA increases to Africa, whereas the non-European members of the DAC provided 55.8% of global ODA increases to the continent. Member States will need to give a much greater priority to Africa in the next three years to meet their targets.

The EU considers the Africa targets to be collective, while respecting individual Member States' regional priorities. However, in order to meet the collective target, ONE assumes a 'fair share' division and applies the target of 50% of increases to individual EU15 Member States. While Denmark, Ireland and Luxembourg achieved their individual Africa target increases in 2010, Germany and Italy had the largest shortfalls in terms of volume. Both Italy and the Netherlands actually provided less ODA to Africa in 2010 than they did in 2004. Spain, Greece and Austria also fell significantly short of individual Africa targets.

In 2011, the average proportion of EU15 aid directed to Africa (out of global ODA) was 41%, but that varied widely between 31% and 73% for individual Member States (see Figure 7). Since 2004, the share of EU15 ODA to sub-Saharan Africa as a percentage of total ODA to Africa has increased only marginally, from 85% in 2004¹¹ to 87% in 2011. Since the EU's commitment is to the continent of Africa, it will be important to monitor that the sub-Saharan region continues to receive a significant proportion of this assistance, even in the wake of the Arab Spring in North Africa. As average income levels in North Africa are nearly double those in sub-Saharan Africa, the latter countries continue to have the greatest financing needs.

Figure 5: Share of Global ODA Increases Directed to Africa (€ Millions)

Meeting 2015 Africa Targets

In the run-up to 2015, EU15 Member States will need to increase ODA to Africa by an additional €20.62 billion to meet the collective Africa target. In 2011, the EU15 had met only 22.5% of the increases needed to reach the 2015 target. To date, Belgium, Luxembourg, Sweden and the United Kingdom have made the most progress towards meeting their target increases. Germany, France and Italy each need to increase ODA investments in Africa by over €4 billion by 2015 to meet their individual targets. These three countries alone account for 68% of the increases needed to meet the collective EU15 Africa target between 2011 and 2015.

Figure 6: % of 2010 Target Increase to Africa Met

Figure 7: Share of Global ODA Going to Africa (2011 ODA Levels)

Figure 8: ODA Increases Required by EU15 to Reach 2015 Africa Targets

FIGURE 9: Africa Target Increase Commitments Met to Date (€ Millions)

* Because multilateral ODA disbursements can spike from year to year, ONE uses the average multilateral disbursements for 2004 and 2005 to establish a baseline for progress by each donor.

Least Developed Countries

In November 2008, the EU collectively agreed to provide between 0.15% and 0.2% of ODA/GNI to the least developed countries (LDCs) by 2010. Having delivered substantial increases since 2004, EU15 countries reached 0.14% of GNI in 2010. Including debt relief, the EU15 met the 0.15% commitment for 2010, but dropped to 0.14% last year.¹² As part of the last push towards the MDGs, the EU needs to ensure that its focus remains on the LDCs through to 2015.

Getting to 0.7%

As Europe continues to cope with its debt crisis and increasingly focuses on balancing state budgets, many Member States will face serious political and budgetary challenges to maintain or accelerate progress towards their 0.7% ODA/GNI commitments. However, there are clear best practice examples where countries have maintained their resolve and commitment to supporting the efforts of developing countries to provide opportunities for a more prosperous, healthy and equitable future for their citizens.

The UK's active consideration of legislation to bind future governments to the 0.7% goal is welcome and noteworthy, and has garnered support across political lines. Belgium already has such legislation in place. Other Member States should be encouraged to pursue similar measures to protect life-saving and enhancing development investments in the years ahead. The EU institutions can also play a vital role. In recent years, the European Commission has encouraged its Member States to adopt timetables demonstrating how and when governments will reach their ODA targets. The European budget also accounts for a significant proportion of many Member States' aid levels. For the EU27 Member States to get on track for 0.7%, it will ultimately require an ambitious EU budget supporting effective, accountable and outcome-based development assistance programmes. With the EU budget for 2007–13 coming to an end, funding for 2014–20 is currently under debate. Negotiations will decide how much EU funding will contribute to the last two years of the push on the MDGs and the first few vital years beyond. The following chapter sets out these issues in detail, and underlines clearly Europe's year of opportunity.

Figure 10: EU15 ODA to LDCs as a Percentage of GNI

Development Assistance Notes

Those Member States which had already reached the 0.7% ODA/GNI target agreed to remain at or above that level, thus contributing to an increased collective target.

This is due to two central factors. First, debt relief accounting aggregates the full face value of cancelled principal and interest commitments over the life of the loan into one year. Second, donors receive credit for the full face value despite significantly discounted mark-to-market loan valuations on their books. By illustration, many donors may require budgetary offsets that are significantly lower than the face value of the debt to finance loan arrears and debt cancellation operations (e.g. significant ‘haircuts’).

http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/12/243&format=HTML&aged=0&language=EN&guiLanguage=en.

This is higher than if each of the EU27 Member States’ individual global ODA targets for 2015 were added together. When adding each of the individual EU27 targets, the figure is 0.53%.

This assumes smoothed multilateral ODA disbursements for EU15 donors based on an averaging of multilateral disbursements across 2004 and 2005. Bulgaria, Romania and Slovakia did not report any ODA disbursements in 2004.

‘Project Evaluation Database’. Swedish Agency for Development Evaluation (SADEV). http://www.sadev.scb.se/eng/database/sadev/sadev.asp.

This comparison excludes years of exceptional debt relief.

These are ODA levels excluding debt relief. For EU12 ODA levels, it is assumed that debt relief figures will be negligible.

This amount represents 0.7% ODA/GNI as estimated based on OECD projections of GNI for EU Member States in 2015.

Data for the EU12’s ODA to Africa are unavailable through preliminary 2011 DAC data, and there is only partial data availability for previous years.

This is an actual 2004 value as opposed to using smoothed multilateral contributions.

In the April 2012 preliminary ODA figures for 2011, Germany did not report its level of bilateral ODA to LDCs. Therefore, the 2011 figure for EU ODA levels disbursed to LDCs may be under-estimated.

European Union Institutions

As many European governments consider cuts to their bilateral development spending, the European Union is negotiating its next seven-year budget – the Multi-Annual Financial Framework (MFF), which will focus for the most part on addressing Europe's economic crisis. However, current proposals also include significant resources for development assistance, including €51 billion earmarked for development assistance to the poorest countries. ¹

With pressure on leaders to keep overall spending levels down, the battle over the allocation of available resources will be intense. However, these negotiations could not be more timely. This budget covers the period 2014–20, thereby determining funding for the crucial Millennium Development Goal (MDG) years of 2014 and 2015, along with the five years beyond. Ensuring that the EU contributes to collective targets by increasing ODA in the coming years will be critical during the negotiations over the next few months. Since Member States count EU development assistance as part of their individual ODA, the MFF decision will have a direct bearing on how close Member States get to their 2015 targets. The larger the share of the EU budget for development, the larger the proportion that Member States will count towards their contributions.

As negotiations proceed over the next year, the 2012 DATA Report analyses the EU institutions, one of the world's largest development budgets and the progress that EU aid has made over recent years in terms of both quality and quantity. This chapter outlines how much of Member States' ODA contributes to EU aid, and also considers the EU's funding and development policy proposals for the forthcoming seven-year budget.

Proposed Increases to the EU Development Budget

On average, between 2005 and 2010, development assistance constituted 8% of the total EU budget. The initial proposal for external assistance in the 2014–20 MFF is €100 billion, of which the majority will be ODA. The €100 billion proposal includes €70 billion for the 'Global Europe' budget (a 25% increase above current levels, in 2011 prices), which includes €21 billion for developing countries under the Development Cooperation Instrument (DCI). The remaining €30 billion will be channelled through the European Development Fund (EDF), a separate instrument dedicated solely for African, Caribbean and Pacific countries (a 13% increase over existing EDF levels, in 2011 prices).² It is the proposed DCI and EDF, which together add up to €51 billion, that are the main focus of this report.

EU Member States channelled 21.5%³ of their total development assistance through EU institutions in 2011,⁴ making the EU the fourth largest global donor (in volume terms). As Figure 1 illustrates, Member States with the smallest development assistance budgets typically channel a larger proportion of their ODA through the EU, while Member States with larger bilateral programmes channel a smaller proportion of development assistance through the EU system.

The proposed MFF increases will be pivotal for bolstering Member States' efforts to reach their development assistance targets by 2015. As Figure 2 shows, if the proposed increase was already in place, based on 2011 ODA figures, Member States would be proportionally closer to reaching their 2015 ODA/GNI targets.⁵ Moreover, the impact of MFF budget levels (e.g. the leveraging effect) is most significant for Member States with smaller development assistance budgets that channel a large share of ODA through the EU institutions, such as Portugal (total ODA as a % of GNI from 0.29% in 2011 to 0.33%), Poland (from 0.08% to 0.12%) or Ireland (from 0.52% to 0.55%), and for the smaller EU accession economies, such as Slovenia (from 0.13% to 0.2%) and Cyprus (from 0.16% to 0.22%). Those Member States with the largest development assistance budgets can leverage a greater overall effect towards the collective EU 0.7% target through their comparatively low contributions on a relative basis, just by protecting and supporting development assistance in the EU MFF.

Figure 1: Share of Global Aid Going Through EU Institutions in 2011, Per EU Donor

Overview of EU Aid Programmes and Select Policies

EU development assistance is channelled through two main streams:

External spending within the EU budget: One of the EU's five budget areas – Heading 4 ('Global Europe') –
is dedicated to external programmes. This stream includes two large, geographically focused development funds: the Development Cooperation Instrument (DCI), for Asia, Latin America and the Middle East, and the European Neighbourhood Policy Instrument (ENPI), for North Africa and Eastern Europe. The 'Global Europe' budget also provides additional thematic funding (e.g. health and education) to advance progress towards the MDGs (via the DCI) as well as resources to support human rights, democracy, humanitarian aid, stability, conflict prevention as well as significant spending for countries preparing to join the EU. Proposals for the 2014–20 budget allocate the largest amount of resources to the DCI.

The European Development Fund (EDF): The EDF supports African, Caribbean and Pacific (ACP) countries through country-specific and regional programmes. The EU manages the EDF on behalf of Member States. Though the EDF is funded by voluntary contributions (not through the EU's budget), EDF and EU budget negotiations occur simultaneously. EDF proposals total €30 billion over the 2014–20 period.

EU development aid provides both Member States and partner countries with a number of concrete, comparative benefits:

Donor coordination: The EU often plays a coordinating role in countries where several EU Member States have a large presence. In 2011, the EU launched a joint programming strategy in developing countries. The EU institutions also play a critical role in the coordination of large- scale projects, particularly for investment- heavy projects (e.g. infrastructure)
in cooperation with the African Union and African sub-regional bodies.

Long-term, predictable aid: The EU's unusually long seven-year budget cycle allows it to make extended partnership commitments and helps to dramatically increase aid predictability.

Far-reaching influence: Through the EU's network of 136 delegations across the world, the EU institutions have
programmes in almost every developing country. Therefore, the EU development budget enables Member States to support countries in which they are not physically present. This is especially critical for fragile and post-conflict states.

Collective action: The EU's regional approach means that EU development funds can reinforce political objectives beyond the reach of individual Member States (such as regional integration, trade and peace-keeping), as well as flexible response mechanisms such as the €1 billion EU MDG Initiative
(see Box 2).⁶

Figure 3: 2011 ODA and 2015 MFF Leverage Effect

Figure 3: EU Development Assistance by Region (2008–10)⁷

Note: The map excludes ODA to unspecified countries and regional ODA to Africa and Asia (that's not designated as sub-regional). Therefore percentages do not add up to 100%.

Figure 3 illustrates the geographical focus of EU aid. Under the Commission's existing MFF proposals, the EU budget's focus on the world's poorest countries would increase substantially. The Commission's proposal would also eliminate bilateral aid to 19 upper middle-income country governments in Asia and Latin America. In principal, this prioritisation towards countries most in need, particularly least developed countries (LDCs) and low-income countries, would be welcome.

Box 1: Linking EU Development Programmes to Concrete Results

Development assistance from the EU institutions has helped developing countries to achieve a number of impressive results.⁸ At the same time, however, more work is required to link all EU spending to concrete, measurable outcomes. According to Commission figures, the EU development budget delivered the following results between 2004 and 2009:

More than 9 million pupils were enrolled in primary education;

More than 720,000 primary school teachers were trained;

More than 85,000 new female students were enrolled in secondary education;

More than 5 million children were vaccinated against measles;

More than 4 million births were attended by health personnel;

More than 5,000 health centres and facilities were built or renewed;

750,000 people with HIV received antiretroviral combination therapy;

7.7 million people were given insecticide-treated bed nets;

More than 31 million people were connected to drinking water and 9 million to sanitation facilities;

36,000 kilometers of roads were constructed or maintained.

Development assistance from the EU institutions has helped developing countries to achieve a number of impressive results. At the same time, however, more work is required to link all EU spending to concrete, measurable outcomes. At the UN MDG summit in September2010, EC President José Manuel Barroso announced that 'the EU is ready to offer to the most committed and needy countries an MDG initiative amounting to €1 billion to make progress on those [MDGs] we are furthest from achieving'. The initiative is funded from reserves of the 10th EDF and supports programmes to accelerate progress on MDGs 4 (child health), 5 (maternal health), 7 (water and sanitation) and 1c (malnutrition) by 2015 in sub-Saharan African, Caribbean and Pacific states. Allocations to the 36 selected countries – 29 of which are in Africa – began in early 2012.

Overall Progress 2005–12

The EU has made significant progress in defining its development strategy and mandate. The adoption of the European Consensus on Development⁹ in 2005 established poverty eradication as the primary objective for EU development assistance. In 2007, the EU and its Member States adopted the Joint Africa–EU Strategy,¹⁰ which is intended to deepen links between the two continents.

In 2009, EU Member States adopted a new legal framework – the Lisbon Treaty¹¹ – which required that all EU external policies (trade, security and foreign relations) take account of the eradication of poverty. This was a critical breakthrough for increasing the prominence of EU development priorities, and provided a strong legal basis for development cooperation within the EU's framework.¹² The Lisbon Treaty also reconfigured the EU institutions to create the European External Action Service, comparable to a foreign ministry, which means that the EU now has a diplomatic presence in 136 countries. The challenge for the EU is to ensure that ODA is focused on poverty eradication and is not redirected to serve short-term foreign policy objectives.

There has also been impressive leadership on development issues at the highest levels of the EU institutions. José Manuel Barroso, President of the European Commission, was responsible for securing approval for €1 billion in assistance for farmers in developing countries during the food crisis in 2008.¹³ The money was intended for seeds and fertilisers, safety-net measures that would improve agricultural productivity, as well as micro-credit investments, infrastructure and storage. Barroso also worked with Development Commissioner Andris Piebalgs to make a further €1 billion available for the MDGs in 2010 (see Box 2). Because the EU's seven-year budget is finalised far in advance, allocating extra funds for development mid-way through a funding cycle takes tenacity and political will, particularly in such a difficult economic climate.

This momentum has continued in 2012. On 14 May, the Foreign Affairs Council adopted Commissioner Piebalgs' Agenda For Change, which outlines a new EU development policy vision. The Agenda aims to concentrate resources in countries that are considered 'most in need' and includes a focus on agriculture, energy, health and natural resources management.

The Foreign Affairs Council also adopted Supporting Horn of Africa Resilience (SHARE) in 2012, a €250 million initiative, of which €125 million represented new money for agriculture programmes. Designed by Commissioner Piebalgs and EU Humanitarian Aid Commissioner Kristalina Georgieva, SHARE aims to break the vicious cycle of humanitarian crises in the Horn of Africa and to strengthen the population's resistance to future crises. This initiative is greatly needed, as is the proposal to create similar programmes in other food-insecure regions, such as the Sahel.

Box 2: The EU Millennium Development Goals Initiative¹⁴

At the UN MDG summit in September 2010, European Commission President JosŽ Manuel Barroso announced that 'the EU is ready to offer to the most committed and needy countries an MDG initiative amounting to €1 billion to make progress on those [MDGs] we are furthest from achieving'. The initiative is funded from reserves of the 10th EDF and supports programmes to accelerate progress on MDGs 4 (child health), 5 (maternal health), 7 (water and sanitation) and 1c (malnutrition) by 2015 in sub-Saharan African, Caribbean and Pacific states. Allocations to the 36 selected countries – 29 of which are in Africa – began in early 2012.

Aid Effectiveness

EU aid quality has improved in recent years and the EU is now a leader on aid effectiveness indicators. In 2010, 86% of the EU institutions' ODA was channelled as country programmable aid (CPA), placing the EU institutions ahead of all European donors assessed in this report. Publish What You Fund also ranked the EU third out of 30 donors in its 2011 Pilot Aid Transparency Index.

While the EU institutions have rightly been praised for their significant progress on aid effectiveness and transparency over the past decade, it will be imperative to ensure that the continuing issues of cumbersome procedures and often long, complicated and inflexible processes are addressed in the implementation of the next MFF. Moreover, the EU should increase its focus on development outcomes and impacts, not least to address increased public scepticism regarding external assistance across Europe.¹⁵

The EU has agreed to reforms that are likely to further improve its aid effectiveness over the coming years. Ahead of the 2011 Fourth High Level Forum on Aid Effectiveness in Busan, for example, EU development ministers agreed to increase joint programming of EU institutions and Member States' development assistance at the country level. A related pilot exercise was launched in several countries earlier this year. This will reduce fragmentation of funding and transaction costs, as well as increasing the impact, transparency and accountability of EU funding. The new Agenda for Change has also introduced a number of additional effectiveness ref orms, such as concentrating EU assistance on a maximum of three sectors in each country. The forthcoming negotiations on the MFF provide an excellent opportunity to embed aid effectiveness best practices into every aspect of EU development aid.

Looking Ahead

In the coming months, development champions within the EU will face two main challenges: first, protecting the ambitious development assistance increases proposed by the European Commission; and second, deciding how these funds will be allocated and channelled.

Firstly, the Commission's €30 billion proposal for the 11th EDF should be protected, regardless of the eventual agreement between Member States and the European Parliament on the structure of the future EU budget. Moreover, EU Member States should support the Commission's €21 billion DCI proposal for the 2014–20 period. This will be the primary vehicle for financing the Agenda for Change, which will support development programmes in priority sectors and improve overall aid reform and effectiveness efforts.

Secondly, it is critical that the European Parliament and the Council ensure that EU development assistance is invested in the most catalytic areas of development – particularly health, agriculture and infrastructure – and that aid effectiveness principles are prioritised throughout. Moreover, the EU should continue to channel an ever growing percentage of development funds for low-income countries with the greatest needs, particularly in sub-Saharan Africa. In particular, there are several budgetary envelopes, programmes and sectors that deserve special attention during the DCI allocation negotiations:

Global Public Goods and Challenges: Under the Commission's proposal, roughly 28% of the total DCI budget would
be spent on 'Global Public Goods and Challenges'. Within this envelope, the Parliament and Council should prioritise multi-annual funding for transparent, accountable, results-based mechanisms for health – particularly the Global Fund to Fight AIDS, Tuberculosis and Malaria (GFATM) and the GAVI Alliance. Moreover, the proposed €1.8 billion for sustainable energy and food security, with a focus on women and smallholder farmers, should also be supported.

Pan-African Programme: The DCI proposal also includes a new Pan-African Programme worth €1 billion, which would mainly support the implementation of the Joint Africa–EU Strategy. This envelope would focus largely on African cross-regional (e.g. between regional economic communities), continental and global initiatives that support cooperation between Africa and Europe.

Health Programme Prioritisation: The EU institutions should also continue to prioritise their commitments to health, including their 20% minimum target for health and education spending, in their development assistance envelopes.

In order for the EU and its Member States to make progress on their promises to the world's poorest countries, European leaders must protect the €51 billion of development assistance proposed for the DCI and the 11th EDF. By raising development funding levels within the EU institutions, the EU and its Member States will be further on track towards the 0.7% ODA/GNI target.

Figure 4: 2011 ODA and Projected 2015 MFF Leverage Effect

Note: EU12 GNI projections obtained using OECD DAC data. See the methodology section for more information about ONE's calculations.

European Union Institutions Notes

This figure of 51 billion combines the 21 billion proposed for the Development Cooperation Instrument (DCI) under the MFF framework and 30 billion for the 11th European Development Fund.

For more information, see European Commission. DG Development and Cooperation EuropeAid, European Development Fund (EDF). http://ec.europa.eu/europeaid/how/finance/edf_en.htm. Accessed 16 May 2012. 

Taking into account the EU15 and nine of the EU12 (no data are available for Bulgaria, Malta or Latvia). For Cyprus, Lithuania and Romania, this refers to 2010 data.

In this report, ‘EU development budget’ or ‘EU development assistance’ refers to all funding programmed and managed by the EU institutions (European Commission and European External Action Service), including the European Development Fund.

No 2011 data are available for Bulgaria, Malta or Latvia.

European Commission. ‘Millennium Development Goals: EU gives additional support to 36 countries for tackling major development challenges’. Press release, 21 December 2011. http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/11/930.

Annual average between 2008 and 2010. This figure refers to bilateral aid of the EU institutions and does not include funds allocated to multilateral agencies.

This information should not be interpreted as reflecting the entirety of EU development aid results. For more information, see ‘EU contribution to the Millennium Development Goals. Some key results from European Commission programmes’. European Commission, EuropeAid Co-operation Office, 2010. http://ec.europa.eu/europeaid/infopoint/publications/europeaid/documents/188a_mdg_en.pdf.

‘Joint statement by the Council and the representatives of the governments of the Member States meeting within the Council, the European Parliament and the Commission on European Union Development Policy: The European Consensus’. Official Journal of the European Union (2006/C 46/01). 24 February 2006. http://ec.europa.eu/development/icenter/repository/european_consensus_2005_en.pdf.

‘The Africa–EU Strategic Partnership. A Joint Africa–EU Strategy’. Council of the European Union. 9 December 2007 http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/er/97496.pdf.

‘Consolidated versions of the Treaty on European Union and the Treaty on the functioning of the European Union’. Council of the European Union. 15 April 2008. http://register.consilium.europa.eu/pdf/en/08/st06/st06655.en08.pdf.  ‘The Africa–EU Strategic Partnership. A Joint Africa–EU Strategy’. Council of the  European Union. 9 December 2007. http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/er/97496.pdf.

Article 208 of the Treaty on the Functioning of the European Union.

‘Regulation (EC) No 1337/2008 of the European Parliament and of the Council of 16 December 2008 establishing a facility for rapid response to soaring food prices in developing countries’. http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2008:354:0062:0069:EN:PDF.

European Commission. ‘Millennium Development Goals: EU gives additional support to 36 countries for tackling major development challenges’. Press release, 21 December 2011. http://europa.eu/rapid/ pressReleasesAction.do?reference=MEMO/11/930.

‘European Union Peer Review 2012’. OECD Development Assistance Committee. 24 April 2012. http://www.oecd.org/dataoecd/61/46/50155818.pdf

Aid Quality

While it is crucial that wealthy countries keep promises they have made to increase development assistance to the world's poorest people, it is just as vital that they honour commitments to improve the quality of development assistance. By shining a light on the extent to which donors meet international standards for effective aid, measuring the quality of development assistance can help to improve its impact. As noted previously, after multiple years of stunted or negative economic growth in developed countries, aid budgets are taking a hit. As governments continue to face resource constraints, many countries are increasingly under pressure to demonstrate the value of development investments, thereby making measurable progress in aid effectiveness even more imperative.

The aid effectiveness agenda has been evolving over the years. In 2005 a group of donors, developing countries and multilateral institutions came together in Paris for the Second High Level Forum on Aid Effectiveness.¹ In signing the Paris Declaration, they each agreed to implement a set of aid effectiveness principles focused on expanding developing country ownership over development priorities; aligning with these priorities and working through developing country systems; harmonising efforts among donors; focusing on development results; and holding each other accountable for those results. In addition, the signatories agreed on a set of targets to be achieved by 2010, along with indicators to monitor progress. In 2008, participants at the Third High Level Forum in Accra reiterated the Paris principles and recommended additional areas of focus to accelerate results. The Accra Agenda for Action called on donors to increase efforts to use developing country systems; develop transparent, forward-looking budgets; reduce fragmentation of development assistance; focus on results; and reduce conditionality and tied aid. It also acknowledged more clearly the important role that civil society and oversight institutions can play in strengthening country ownership.

Last year, in Busan, South Korea, the Fourth High Level Forum on Aid Effectiveness met to assess the results of previous commitments and to set out a path for continued improvement in the quality of aid. Although some improvement was made, particularly by developing countries, overall only one out of the 13 targets (coordinating technical cooperation) set in Paris was achieved by the 2010 target date.² In charting a path forward, Busan focused on development effectiveness (rather than solely on aid effectiveness), signalling a shift to include new partners and to discuss aid within a broader conversation about development resources. In the outcome document – the Busan Partnership for Effective Development Cooperation – governments recommitted to aid effectiveness principles and made new pledges on aid transparency, accountability in managing public resources and country-led results monitoring. Country representatives are currently developing a new set of indicators against which to measure progress.

This chapter assesses progress on past aid effectiveness commitments, and other measures of aid quality, made by EU15 Member States and the EU institutions. Developing country governments also have a key role to play in improving aid effectiveness, for example by increasing the transparency of domestic resources and ensuring accountability for the development assistance they receive as well as for the use of their country's natural resources. Although this chapter focuses on aid effectiveness commitments and progress made by donors, future ONE reports will assess African governments' progress in ensuring the efficient use of development resources.

The European Union's Commitments to Aid Effectiveness

Member States of the EU are signatories to previous international agreements on aid effectiveness. The EU also has its own objectives for improving aid effectiveness. In the 2009 Lisbon Treaty, Member States recognised development cooperation as a critical element of the EU's international presence. The treaty also sets out that EU Member States have the responsibility to ensure that development cooperation focuses on poverty reduction, and that all external policies contribute to development objectives.³

In the 2007 EU Code of Conduct on Division of Labour⁴ and the subsequent Fast Track Initiative,⁵ EU Member States committed to increase development efficiency by collaborating on the ground in a selected group of partner countries. In November 2009, the EU established an Operational Framework on Aid Effectiveness that focused on streamlining the division of labour among Member States and institutions. Governments made further commitments in June and December 2010, adding targets on increasing the use of country systems, ensuring that technical cooperation in developing countries strengthens capacity, and enhancing accountability and transparency through increased transparency in development assistance volumes, allocations and future country-level spending plans.⁶

Ahead of the High Level Forum in Busan, the EU introduced a Transparency Guarantee and the EU Joint Programming of Aid policy.⁷ The Transparency Guarantee is a commitment by EU Member States and institutions to make information more easily accessible, shared and published. The EU Joint Programming of Aid policy aims to increase coordination by ensuring that EU Member States and institutions work together to decide where assistance is needed most, which donors are best able to deliver that assistance, and how much development assistance should be given. Joint programming aims to increase impact and results by improving coordination, transparency and predictability.⁸

Measuring Aid Quality

This year's DATA Report draws on the Quality of Official Development Assistance (QuODA) index, developed jointly by the Center for Global Development and the Brookings Institution's Center for Global Economy and Development. The QuODA index provides a comprehensive assessment of donor aid quality across four dimensions: (1) 'Maximising Efficiency'; (2) 'Fostering Institutions'; (3) 'Reducing the Burden on Recipient Countries'; and (4) 'Transparency and Learning'. For each dimension, QuODA aggregates a number of indicators – 31 in total – which reflect international effectiveness standards. The latest edition of QuODA, which is used in this chapter, uses indicators and data drawn mostly from the OECD DAC Creditor Reporting System and the results of the 2011 Paris Monitoring Survey. Additional indicator data is drawn from sources including the IMF World Economic Outlook, AidData, the International Aid Transparency Initiative, the World Values Survey, agency websites and the Afro-, Asian, Euro- and Latino-barometers. To enable comparison amongst donors, QuODA converts the raw data into z-scores, with z-scores for aggregate indicators averaged for each dimension.⁹ However, this year's QuODA index is only the second year that the analysis has been done; as a result, analysis of historical progress on aggregate dimensions is limited.

This section explores how the EU15 and the EU multilateral institutions perform on each of the four dimensions,¹⁰ compared with each other and with the other donors assessed by QuODA.¹¹ Additional commentary on specific donors' progress is contained in the country profiles in the following section.

Previous DATA Reports have assessed aid effectiveness by measuring donor progress against promises made at Paris and Accra and using data reported yearly to the OECD DAC. However, these indicators do not capture all facets of aid quality and are updated only every few years. The latest Paris Monitoring Survey in 2011 uses 2010 data, and only measures progress according to the 32 developing countries that took part in all three Paris Monitoring Surveys. Further, these surveys are conducted only every three years. In order to provide a more comprehensive measure of aid effectiveness, QuODA aggregates available data and supplements DAC reporting with other data sources to create a fuller picture of aid quality and to enable comparison across donors. But it has limitations as well. In order to create this aggregate measure of aid quality, the latest QuODA index uses 2009 DAC data and 2010 data from the latest Paris Monitoring Survey.

In addition to each of the four QuODA aggregate dimensions, this chapter also pulls out two key indicators for individual examination for each dimension.¹² Analysis of progress towards these indicators uses the most recent data available. For country programmable aid (CPA), untied aid, use of country systems, predictability and fragmentation, 2010 DAC data is used. For multilateral institutions and quality of evaluation policy, QuODA's 2009 aggregate data are used, and IATI signatory status is current as of May 2012. So while this chapter relies on the most recent data available, it may not reflect the most recent efforts by donors to improve the quality of development assistance.¹³

Figure 1: Maximising Efficiency

Maximising Efficiency

QuODA's 'Maximising Efficiency' dimension looks at how development assistance is allocated and delivered, measured against a global standard of how assistance can best contribute to sustainable growth and poverty reduction. Eight indicators reward donors for allocating more development assistance to poorer and better-governed countries, minimising administrative costs, allocating a larger portion of assistance in ways that allow decisions about its use to be made at the country level (i.e. country programmable aid – CPA), increasing specialisation by providing more development assistance to developing countries or sectors on which they focus, contributing to global public goods and untying aid.

In this dimension, the performance of the EU member states varies widely, and multilateral donors score much better than bilateral donors. At 86% in 2010, the EU institutions have the highest percentage of CPA, and have made good progress since 2005, increasing CPA from 66%. Germany, Italy, France and Portugal have also registered good progress in increasing CPA, in contrast with the regression of both Greece and Ireland over the same period. Austria and Belgium had the lowest proportion of CPA in 2010, at 17% and 22% respectively. With respect to untied aid, the United Kingdom and Ireland perform best; 100% of these countries' development assistance was untied in 2010. The Netherlands increased its untied aid from 81% in 2007 to 94% in 2010. Austria, Spain and Germany decreased untied aid substantially during that period. Greece and Portugal performed worst in 2010 in untying aid, with only 39% and 43% untied respectively.

Figure 2: Country Programmable Aid (CPA) The Percentage of Bilateral, Gross Global ODA Disbursements Programmable at Country Level

Source: OECD DAC Table 2a

Figure 3: Percentage of Aid that is Untied The Percentage of Global Bilateral ODA that is Untied, Based on Bilateral Gross Commitments, Excluding Technical Cooperation and Administrative Costs

Source: OECD DAC

Figure 4: Fostering Institutions

Fostering Institutions

Fostering local institutions is essential to help developing countries build capacity and strengthen country ownership over development priorities. Channelling development assistance to partner country priorities through their own budgets and agencies helps developing countries to build strong and sustainable country systems.

QuODA uses eight indicators to assess how well donors support local institutions. These measure the proportion of development assistance that is dedicated to partner countries' priorities, avoidance of project implementation units, how well donors communicate about their spending plans in advance, the proportion of development assistance that goes to governments with good operational strategies, the use of country systems, the degree to which technical cooperation is coordinated with partner countries and the predictability of development assistance.

Of the four dimensions, 'Fostering Institutions' has the highest variance among donors – this applies to the 16 donors assessed in this report, as well as the complete set of 31 DAC donors assessed by QuODA. Fifteen of the 16 European donors assessed in this report registered an improvement in this dimension from the first QuODA. Of all the donors measured in this report, Ireland channelled the greatest percentage of assistance through country systems in 2010, with 84% in public financial management (those agencies that manage public resources and deliver services) and 91% in procurement systems (agencies that identify needs, choose suppliers and fulfil orders to fill those needs efficiently). Luxembourg utilised country systems poorly in both public financial management and procurement, channelling only 5% and 17% respectively through each. While Portugal used country systems for only 2% of assistance in public financial management, it channelled 90% of procurement spending through country systems, one of the highest percentages. Austria, Denmark and Spain have registered impressive improvements in both areas since 2005. On predictability, Scandinavian donors lead the way, with Sweden, Finland and Denmark registering close to 100% predictability on both one- and two-year measures. The UK's development assistance is also very predictable. Portugal and Spain, by contrast, are two of the least predictable donors.

Figure 5: Use of Country Systems for Public Financial Management (PFM) and Procurement

The percentage of bilateral ODA channelled through developing country procurement systems and through country public financial management systems.

Source: 2011 Paris Monitoring Report, Appendix B

Figure 6: One- and Two-Year Predictability Ratios

Predictability ratios measure the percentage of bilateral CPA that was actually disbursed, compared with estimated levels of CPA programmed by donors one and two years prior. A 100% predictability ratio is ideal, while a ratio of more than 100% shows that donors disbursed more in a given year than was programmed previously.

Source: OECD 2010 and 2011 Aid Predictability Report

Reducing Burden

As the number of donors, agencies and mechanisms has increased over the years, so has the burden that developing countries face in managing relationships. 'Reducing Burden' is measured across seven indicators that reward donors who reduce the number of agencies involved in the relationship with partner governments, improve concentration ratios, increase project size, contribute to multilaterals, coordinate their missions and analytical work with other donors and channel assistance through programme-based approaches in order to increase country ownership and decrease project-specific assistance.

The 15 EU member states and institutions score better on 'Reducing Burden' than on 'Maximising Efficiency' or 'Fostering Institutions', with the majority scoring above average. On fragmentation specifically, the EU institutions perform better than the Member States. Germany, Greece and Austria also score well. Italy decreased its level of fragmentation between 2007 and 2010, but Luxembourg and the Netherlands increased fragmentation over the same period. Denmark and Finland scored worst, with the most fragmented assistance. On funding to multilaterals, Italy, Austria and Greece (donors which scored poorly in bilateral aid quality indicators) channelled the largest proportion of core support to multilateral agencies. According to QuODA data, Spain and the Netherlands channelled the smallest proportion of core support to multilateral agencies.

Figure 7: Reducing Burden

Figure 8: Concentration Ratio

Concentration ratios measure how much of a donor's core bilateral aid contributes to 'significant' developing country relationships. Significant relationships are those where a donor gives more aid to a developing country than its global share of aid or where it is among the larger donors that cumulatively account for at least 90% of a developing country's ODA. Fragmentation is thus the inverse of concentration, and references the ratio of 'insignificant' relationships with developing countries.

Source: OECD DAC

Figure 9: Contribution to Multilaterals (2009)

The amount of ODA channelled through multilateral institutions (rather than bilateral assistance). As multilateral institutions themselves, the EU institutions are not scored on this measure.

Transparency And Learning

Providing timely and comparable information about development assistance spending and policies is crucial to improving both coordination among donors and planning by developing country governments. Transparent reporting also helps citizens to hold their governments accountable for how resources are spent. Learning is about using evidence and experience to improve performance over time. QuODA uses eight indicators to measure 'Transparency and Learning'. Two indicators measure membership in, and implementation of, the International Aid Transparency Initiative (IATI). IATI is a voluntary multi-stakeholder initiative that has developed and agreed on a common, open, international standard for reporting ODA information. Other indicators cover therecording of project titles and descriptions and reporting of delivery channels, and measure how closely project-level reporting data match commitment data. New to this year's QuODA are a measure of the quality of donors' evaluation policies and an indicator that rewards donors for providing development assistance to governments with good monitoring and evaluation frameworks.

In 'Transparency and Learning', seven of the 16 donors assessed in this report scored worst among the 31 donors assessed by QuODA overall. Thirteen of the 16 EU donors analysed here improved their performances over the past year, but average progress for the 16 together is slight. More than half of the Member States and the European Commission have signed up to IATI, but France and Italy are among a number of Member States that have not. The UK, Ireland and the EU institutions are among those judged to have good evaluation policies by QuODA. Neither France nor Italy is in the group of donors performing best in terms of their evaluation policies. Greece, Italy and Luxembourg are judged to have the worst evaluation policies.

Figure 10: Transparency and Learning

Figure 11: International Aid Transparency Initiative (IATI)

Source: IATI website, accessed May 2012

Figure 12: Quality of Evaluation Policy (2009)

This assessment aggregates multiple indicators that analyse the evaluation policies of each donor's primary development agency.

Source: The Quality of Official Development Assistance (QuODA) Assessment 2009

Aid Quality Notes

The First High Level Meeting on Aid Effectiveness took place in Rome in 2003.

OECD (2011) ‘Aid Effectiveness 2005–10: Progress in Implementing the Paris Declaration’, p.15. http://www.oecd.org/dataoecd/25/30/48742718.pdf.

Council of the European Union, Treaty of Lisbon. http://www.consilium.europa.eu/treaty-of-lisbon.

EU Code of Conduct on Complementarity and Division of Labour in Development Policy, 15 May 2007. http://register.consilium.europa.eu/pdf/en/07/st09/st09558.en07.pdf.

EU Fast Track Initiative: Division of Labour, December 2010. http://www.oecd.org/dataoecd/36/35/46836584.pdf.

Council of the European Union, Operational Framework on Aid Effectiveness, 11 January 2011. http://register.consilium.europa.eu/pdf/en/10/st18/ st18239.en10.pdf.

Europa. 2011. ‘The European Union announces new initiatives to increase transparency and improve coordination in aid delivery’, 30 November 2011. http://europa.eu/rapid/pressReleasesAction.do?reference=IP/11/1472.

Further information regarding the implementation of the Joint Programming commitments is available in the EU chapter of this report.

 A z-score shows how many standard deviations away from the mean an individual donor’s performance lies.

This report focuses on the 15 bilateral EU Member States that report to the OECD DAC, as well as the EU institutions. Apart from Greece, the remaining 15 donors are also monitored by the Paris Surveys, ensuring reliable, comparable data for QuODA and our other analysis.

The reader should bear in mind that QuODA does not enable comparison across its dimensions and that any estimates of progress from the first to the second edition of QuODA are estimates because QuODA does not assess statistical significance.

The data supporting the donor trends highlighted here comes from sources other than QuODA, though they are focused on indicators included in QuODA’s analysis.

Please refer to the methodology section of the report for a detailed description of indicators and data sources.

The EU and its Member States

Donor Assessment

Leaders

Of the 16 donors assessed, Ireland and the UK consistently score in the top four in all dimensions, and in the top ten of the 31 donors assessed by QuODA. Both countries are committed to principles critical for the effectiveness of their development assistance, such as focusing assistance on poor countries, supporting the use of country systems to strengthen capacity in those countries and untying 100% of their aid, thereby ensuring efficiency to achieve development outcomes. EU institutions also perform consistently well, especially in 'Transparency and Learning', where they rank third among the 31 donors assessed by QuODA.

The EU multilateral institutions rank towards the top of the 16 donors assessed in this report, scoring above average on all four dimensions of aid quality and achieving impressive results in terms of low administrative costs, strong evaluation policy and IATI reporting. The EU institutions registered progress on all dimensions except 'Reducing Burden'. Looking at individual indicator data, EU institutions made particular progress on untying aid (from 50% to 79% from the first to the second edition of QuODA) and in using country systems (from 34% to 48%). The EU institutions also charted impressive progress in channelling assistance to partners with strong monitoring and evaluation frameworks.

The UK and Ireland rank better than the EU institutions in 'Maximising Efficiency', 'Fostering Institutions' and 'Reducing Burden'. However, EU institutions perform better than the bilateral EU donors in the 'Transparency and Learning' indicators. Nevertheless, improvements can be made, and the EU institutions should sharpen the focus of their aid on partner countries with good operational strategies, ensure that technical cooperation is better coordinated with that of other donors, and further simplify rules and procedures in the delivery of EU assistance. Denmark ranks first among all donors assessed by QuODA in 'Fostering Institutions', the dimension where EU institutions have the most progress to make, and are ranked 14th.

Laggards

At the other end of the spectrum, the performance of Greece is the poorest, with Greek development assistance ranking at or near the bottom in all four dimensions. Greece is the only donor of the 16 that has not participated in the Paris Monitoring Survey (therefore the QuODA analysis only averaged scores on indicators for which data were available). Greece has one of the highest levels of tied aid among EU Member States and allocates a small proportion of its assistance to low-income countries. Austria, Belgium and Italy also score poorly across a number of dimensions.

While France's aid quality scores are generally average, the quality of its development assistance could be substantially improved by enhancing predictability, tackling fragmentation and signing on to IATI. Belgium could also improve its aid quality ranking significantly by focusing on measures of 'Transparency and Learning', particularly by reporting key project information and improving its evaluation policy.

Transparency and Accountability for Development Financing

A number of European donors – such as the UK, Ireland, Sweden and the EU institutions – are leading the way on aid effectiveness and should be commended for their progress. Other donors must increase efforts to meet their commitments to improve aid quality so that scarce resources can be better utilised.

To advance progress, all countries providing aid should publish development assistance information in a timely, comprehensive and comparable manner, in line with IATI standards. Developing countries should continue to improve budget transparency by publishing information and involving citizens at all stages of the budget process, ensuring citizen participation and buy-in down to the local level. There should also be greater transparency and accountability in the governance of natural resources so that citizens can hold their governments accountable for the use of national oil and mineral wealth. Better harnessing revenues from these sources can help increase government support for other sectors such as health and agriculture. Legally binding transparency measures are necessary to help governments, civil society and citizens make the most of their own resources.

The shift to broaden the aid effectiveness agenda at Busan to include more actors and other development issues was an important one. However, this expansion should not come at the expense of clear, measurable and time-bound commitments on aid effectiveness that renew and reaffirm commitments made in Paris and Accra. Countries should work to translate the agreements reached at Busan into clear, results-oriented commitments that can be monitored on a yearly basis. By providing development assistance in ways that promote transparency, accountability and a focus on results, donors can help to make development assistance more efficient and support the efforts of developing countries to ensure that all resources – development assistance and other resources – are invested effectively. In this way, development assistance can help to ensure that people in developing countries have the information and resources they need to hold governments accountable and to take greater control of their own development.

EU15 Country Profiles

" Despite the crisis, Europe reaffirms its solidarity with the poorest across the world. EU aid has pulled millions of people out of poverty and saved countless lives over the last ten years. Development aid is both solidarity and an investment to make the world safer and more prosperous. I therefore call on Member States to reaffirm their commitment to achieving the goal of increasing ODA to 0.7% of GNI by 2015". —European Commissioner for Development, Andris Piebalgs, 2012

Austria's Progress: 2004–11

Austria did not meet its pledge to reach a 0.51% ODA/GNI target in 2010: global ODA levels reached only 0.28% of total GNI, and it missed its 2010 global ODA target by €659.7 million.¹ Its global ODA decreased by 5.5% in 2011, reflecting the strong push towards austerity of the current government. Austria's 2010 Africa target (based on 50% of the increase to the global interim target)² was €659.7 million, but it fell short of this, with ODA disbursed to Africa reaching only €296.2 million. Austria met just 22.2% of the target increases promised for 2010. Between 2004 and 2011, it increased development assistance to the African continent by 42.5% (€81.8 million); development assistance to the sub-Saharan Africa region, specifically, increased by 45% (€76.2 million) and overall development assistance by 43% (€230. 1 million).³

Austria operates bilaterally in just 13 countries, four of which are in sub-Saharan Africa: Ethiopia, Burkina Faso, Uganda and Mozambique. Austria typically appropriates roughly half of its total ODA to multilateral institutions.⁴ However, it is one of the few countries that has not made pledges to GAVI, the Global Fund to Fight AIDS, Tuberculosis and Malaria, or GAFSP.

Aid Effectiveness

The most recent DAC peer review from 2009 describes Austria's development assistance as being fragmented among many institutional sectors and without a consolidated ODA budget. In terms of QuODA's assessment of aid quality, it scores poorly in the 'Fostering Institutions' and 'Transparency and Learning' dimensions and ranks last in 'Maximising Efficiency'. Its mediocre score in 'Reducing Burden' is its best. Austria has made some progress in improving the quality of its development assistance since 2005, increasing the proportion channelled through public financial management country systems from 19% in 2005 to 63% in 2010, and channelled through procurement systems from 30% in 2005 to 86% in 2010. Although the percentage of its ODA classified as country programmable aid (CPA) increased from 7% in 2005 to 17% in 2010, there is still much progress to be made. As Austria ranks last in 'Maximising Efficiency' in QuODA and poorly in two other dimensions, weaknesses in efficiency could be improved by allocating a greater proportion of its ODA to poor countries and untying development assistance. To make progress in transparency, Austria should join the International Aid Transparency Initiative (IATI) and implement its standards on publishing aid.

Looking Ahead: 2012–15

Austria's global ODA target in 2015 is €2.24 billion. Between 2011 and 2015, it needs to substantially increase its global ODA levels by €1.48 billion. This amounts to a €369 million annual increase needed for 2011–12; the EC's published projections estimate a €672.9 million increase for 2012, more than meeting its commitment.⁵ Austria's ODA target for Africa in 2015 is €1.05 billion. Between 2011 and 2015, it would need to increase its annual ODA levels to the continent by €771.1 million, or by €192.8 million for 2012.

Despite the projection to stay on target for 2012, the Austrian Ministry of Foreign Affairs concedes that it will not meet the 2015 target of 0.7%, due to federal budget constraints. Instead, its 2010 programme outlook, which provides development priorities up until 2014, aims for the 'greatest possible efficiency in the administration of funds'.⁶ The plan indicates that Austria will likely increase its focus on Africa, while its operations in Asia and South America are currently being phased out.⁷ With a view to further improving aid quality, the Austrian Development Agency plans to examine its existing relationships with multilateral agencies, aiming largely to increase the efficiency and effectiveness of its programmes in three areas: energy, water, and peace and security.⁸ As the Austrian government channels 30.3% of its global ODA (or €232 million in 2011) through the EU institutions, the current negotiations on the EU's Multi-Annual Financial Framework 2014–20 represent a significant opportunity for Austria to increase its overall aid levels and get closer to its 0.7% target by 2015.

Austria's ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

Austria Notes

Including debt relief, Austria’s global ODA disbursements reached 0.32% in 2010.

The EU collectively committed to provide 50% of global ODA increases to the African continent. Individual EU donors did not specify what proportion of their global ODA increase would go to Africa. It has therefore been assumed that each EU country would contribute 50% of its global ODA increases to Africa to meet the collective EU target.

The 2004 baseline averages multilateral disbursements over 2004 and 2005 to account for their ‘lumpiness’.

Austria. Federal Ministry for European and International Affairs. ‘Three-Year Programme on Austrian Development Policy, 2010–2012’. 18 April 2012. http://www.entwicklung.at/uploads/media/Three-YearProgramme10-12.pdf.

The 2012 projection has been taken from an April 2012 EC press release that gave ODA forecasts based on estimates provided by Member States. The difference in 2011 and 2012 ODA projections is due to ODA figures being in current prices and inclusive of debt relief while ONE monitors ODA increases exclusive of debt relief. However, in the absence of 2012 figures exclusive of debt relief, global ODA figures including debt relief have been taken.

Austria. Federal Ministry for European and International Affairs. ‘Three-Year Programme on Austrian Development Policy, 2010–2012’. Op. cit.

According to the three-year plan, Austria plans to end programmes in Nicaragua, its only South American partner country by 2013. In Asia, its only partner country is Bhutan.

Austria. Federal Ministry for European and International Affairs. ‘Three-Year Programme on Austrian Development Policy, 2010–2012’. Op. cit.

Belgium's Progress: 2004–11

Over the past decade, Belgium has maintained steady progress towards reaching its ODA/GNI target of 0.7% by 2010, a more aggressive timeline than most EU15 countries. However, global ODA levels disbursed in 2010 reached only 0.52% of total GNI,¹ falling short of the global ODA increase target by €645.8 million. Belgium also fell short of its 2010 Africa target of €1.25 billion (based on 50% of the increase to the global interim target),² with levels of development assistance reaching €850.6 million for the year. It met 41% of its Africa ODA target increase promised over 2004–10. Between 2004 and 2011, Belgium increased development assistance to Africa by 71.8% (€413.9 million); development assistance to the sub-Saharan region, specifically, increased by 82.8% (€425 million)³ and global development assistance by 59.3% (€714.3 million).⁴ Belgium was one of the few EU countries to continue to increase both global ODA and ODA to sub-Saharan Africa in 2011.⁵ Belgium focuses its bilateral assistance on 18 partner countries, 11 of which are in sub-Saharan Africa.⁶ Agriculture and food security are priority sectors, and Belgium has committed to spending 10% of its ODA on agriculture and rural development by 2010, increasing to 15% by 2015.⁷ Between 2004 and 2011 Belgium contributed €101.3 million to the Global Fund.⁸ Belgium does not contribute funds to GAVI or GAFSP.

Aid Effectiveness

Belgium ranks in or near the bottom third on all four dimensions of aid quality measured by QuODA. The share of its bilateral ODA classified as CPA decreased from 35% in 2005 to 22% in 2010. Belgium ranks last in 'Transparency and Learning' and scores very poorly on 'Reducing Burden'. While not an IATI signatory, it has recently improved its efforts in the area of transparency, being one of the first countries to report to the OECD DAC's Survey on Donors' Forward Spending Plans in CRS++ format, which is the DAC's detailed activity-level reporting format. Since last year, Belgium has also made details of activities and documents publicly accessible on a government website.⁹ With respect to monitoring and evaluation, its Belgium's Special Evaluation Office was the first bilateral evaluation unit to subject itself to an international peer review in 2009, and was subsequently reorganised.¹⁰ Belgium scored well on untying aid and allocating ODA to poor countries. Only 5% of its total ODA is tied, placing it among the least restrictive donors in Europe. To continue to improve aid quality, Belgium should build on its achievements with the Office of the Special Evaluator, join the International Aid Transparency Initiative (IATI) and implement its standards on development assistance publishing.

Looking Ahead: 2012–15

Belgium's global ODA target for 2015 is €2.8 billion. Between 2011 and 2015, it needs to increase global ODA levels by €881.3 million to reach this target. This translates into an annual increase of €220.3 million for 2011–12; current EC published estimates forecast that Belgium will increase its ODA by €158.3 million in 2012.¹¹ Belgium's Africa ODA target for 2015 is €1.37 billion. Between 2011 and 2015, it needs to increase ODA levels to Africa by €383.9 million, or by €96 million for 2012. In December 2011, the new Belgian government was sworn in, and designated a new minister for Public Enterprises, Scientific Policy and Development Cooperation in Charge of Policy for Large Cities. Whereas previously there was a separate minister for Development Cooperation, this function has now been merged with other responsibilities. Due to the budgetary situation, the new government felt obliged to freeze growth in funds for development cooperation in 2012 and 2013. It reaffirmed, however, its commitment to achieving ODA levels of 0.7% of GNI by 2015.¹² In order to ensure the necessary progress towards this goal, it is in Belgium's interest to protect the proposed increases in ODA under the new EU budget for 2014–20 in ongoing negotiations with other Member States.

Belgium's ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

Belgium Notes

Including debt relief, Belgium’s global ODA disbursements reached 0.64% in 2010.

The EU collectively committed to provide 50% of global ODA increases to the African continent. Individual EU donors did not specify what proportion of their global ODA increases would go to Africa. It has therefore been assumed that each EU country would contribute 50% of its global ODA increase to Africa to meet the EU target.

The increase in ODA for sub-Saharan Africa between 2004 and 2011 was slightly higher than for Africa as a whole because in 2004 ODA to sub-Saharan Africa was much lower than ODA going to Africa. By 2011, however, ODA going to the sub-Saharan region was approximately the same as for the whole of the continent, meaning that ODA  increases for sub-Saharan Africa between 2004 and 2011 were larger than for the whole Africa region.

The 2004 baseline averages multilateral disbursements over 2004 and 2005 to account for their ‘lumpiness’.

Global development assistance (excluding debt relief) increased by 1.2% between 2010 and 2011. The OECD DAC reported in April 2012 that Belgium’s global ODA (including debt relief) had decreased by 13%; this was largely due to a large fall in debt relief between 2010 and 2011.

‘Partner Countries’. Kingdom of Belgium, Foreign Affairs, Foreign Trade and Development Cooperation. 15 April 2012. http://diplomatie.belgium.be/en/policy/development_cooperation/countries/partner_countries/.

‘Strategy Note for the Agriculture and Food Security Sector’. Kingdom of Belgium, Foreign Affairs, Foreign Trade and Development Cooperation. October 2010. http://diplomatie.belgium.be/en/policy/development_cooperation/topics/agriculture_and_food_security/.

‘Pledges and Contributions’ (spreadsheet). The Global Fund. Converted into euros using the DAC annual exchange rate conversions. http://www.theglobalfund.org/documents/core/financial/Core_PledgesContributions_List_en/ (as of 8 May 2012). 

Consultation with Belgian Ministry of Development Cooperation, 26 April 2012.

‘Special Evaluation Office’. Kingdom of Belgium, Foreign Affairs, Foreign Trade, and Development Cooperation. 15 April 2012. http://diplomatie.belgium.be/en/policy/development_cooperation/evaluation/special_evaluation_office/. Consultation with Belgian Ministry of Development Cooperation, 26 April 2012.

The 2012 projection has been taken from an April 2012 EC press release that gave ODA forecasts based on estimates provided by Member States. The difference in 2011 and 2012 ODA projections is due to ODA figures being in current prices and inclusive of debt relief while ONE monitors ODA increases exclusive of debt relief. However, in the absence of 2012 figures exclusive of debt relief, global ODA figures including debt relief have been taken.

‘Draft Statement on General Policy’. Kingdom of Belgium. 9 May 2012.

Denmark's Progress: 2004–11

Denmark has met or exceeded 0.7% ODA/GNI every year since 1978. It had pledged to reach 0.8% ODA/GNI in 2010, but it met this global target as far back as 1984. Global ODA levels disbursed in 2010 reached 0.89% of total Danish GNI,¹ amounting to €2.16 billion. Denmark's Africa ODA target (based on 50% of the increase to the global interim target)² was €821.6 million in 2010, while its actual disbursements to Africa were €910.6 million, exceeding the target pledged by €89 million. Between 2010 and 2011, Denmark increased its ODA to Africa by €36.9 million (a 4.1% increase), one of eight EU15 donors to increase its contribution. Between 2004 and 2011, Denmark increased development assistance to Africa by 21% (€164.8 million); over the same period, it increased development assistance to the sub-Saharan region, specifically, by 13.2% (€96.2 million), and its overall development assistance by 15.6% (€288.6 million). ³

Denmark's commitment to sub-Saharan Africa is apparent in its development assistance portfolio. The Danish foreign aid agency, Danida, has directed the bulk of its ODA towards 26 countries, 14 of which are in the region.⁴ Sub-Saharan African countries also made up four of Denmark's top five aid recipients in 2010, based on its bilateral ODA disbursements: Mozambique, Tanzania, Uganda and Ghana.⁵ Between 2004 and 2011 Denmark contributed €26.6 million to GAVI.⁶ Denmark's contributions to the Global Fund over 2004–11 totalled €158.3 million.⁷

Aid Effectiveness

Denmark is a model for aid quality in 'Fostering Institutions' and 'Reducing Burden', according to QuODA. In 2009, it allocated funding to 87 multilateral organisations, compared with 156 in 2004.⁸ It is amongst the most predictable donors, with two-year predictability ratios of 101% in 2009 and 97% in 2010. It has also increased the proportion of development assistance channelled through country systems, from 29% in 2005 to 62% in 2010 for public financial management, and from 44% in 2005 to 80% in 2010 for procurement. Denmark is a member of the International Aid Transparency Initiative (IATI) and conforms to its reporting standards. However, the percentage of its bilateral ODA classified as CPA decreased from 66% in 2005 to 56% in 2010. There is room for Denmark to improve in 'Transparency and Learning'; it should better report its aid delivery and disbursement channels to the DAC. Finally, Denmark can do more to decrease fragmentation in its relationships with developing countries. In 2010, only 35% of its relationships were significant.⁹

Looking Ahead: 2012–15

Denmark's global ODA target for 2015 is €2.64 billion. Between 2011 and 2015, it would need to increase global ODA levels by €492.3 million to achieve its global target, which means that a €123.1 million increase is needed for 2011–12. However, the Danish government plans to increase its development budget by €31.5 million (DKK 234 million) in 2012, and a further €49.2 million (DKK 366 million) in 2013.¹⁰ Denmark's target for ODA to Africa for 2015 is €1.17 billion. Between 2011 and 2015, it would need to increase ODA levels to Africa by €225.7 million, or €56.4 million from 2011–12. Denmark has pledged €14 million to GAVI over 2012–15.¹¹ Over 2012–13 it has pledged €44.8 million to the Global Fund. ¹²

During the first half of 2012, Denmark held the Presidency of the European Union. Its government should take a lead in prioritising development in ongoing negotiations on the next seven-year EU budget, encouraging other Member States to follow its lead in meeting the 0.7% target.

Denmark's ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

Denmark Notes

Including debt relief, Denmark’s global ODA disbursements reached 0.91% in 2010.

The EU collectively committed to provide 50% of global ODA increases to the African continent. Individual EU donors did not specify what proportion of their global ODA increases would go to Africa. It has therefore been assumed that each EU country would contribute 50% of its global ODA increase to Africa to meet the EU target.

The 2004 baseline averages multilateral disbursements over 2004 and 2005 to account for their ‘lumpiness’.

‘Partner Countries’. Ministry of Foreign Affairs of Denmark. http://um.dk/en/danida-en/activities/countries-regions/partner-countries/. Accessed 15 April 2012.

OECD data based on bilateral ODA excluding debt relief, ONE’s calculations.

These were through direct contributions. GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions. http://www.gavialliance.org/funding/donor-contributions-pledges/

‘Pledges and Contributions’ (spreadsheet). The Global Fund. Converted into euros using the DAC annual exchange rate conversions. http://www.theglobalfund.org/documents/core/financial/Core_PledgesContributions_List_en/ (as of 8 May 2012).

OECD DAC Peer Review of Denmark.

For an explanation of ‘significant’ relationships between donor and recipient countries, see the Methodology section.

Ministry of Foreign Affairs of Denmark. ‘ Danmark skal satse på menneskerettigheder, landbrug og grøn vækst’ (Denmark to focus on human rights, agriculture and green growth). Press Release, 24 January 2012. http://um.dk/da/danida/om-danida/nyheder/newsdisplaypage/?newsID=5A8B9A24-68A3-4B8C-92DD-B8F5FE93765A. Converted into euros using historic exchange rate of 24 January 2012.

These pledges are through direct contributions. GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Op. cit.

‘Pledges and Contributions’ (spreadsheet). The Global Fund. Op. cit.

Finland's Progress: 2004–11

Finland committed to increase its ODA to reach a target of 0.51% of GNI by 2010. It exceeded this target by €77.8 million, reaching 0.55% of GNI in 2010, or €1.06 billion. Its 2010 Africa target (based on 50% of the increase to the global interim target)¹ was €429.2 million; Finland fell just short of this target, delivering €426.6 million to the continent and meeting 98.6% of its promised increases to Africa between 2004 and 2010. Between 2004 and 2011, Finland increased development assistance to Africa by 56.9% (€140.2 million); development assistance to the sub-Saharan region increased by 60% (€128.7 million), while overall development assistance increased by 64.5% (€397.4 million).²

Although Finland has not yet surpassed the 0.7% ODA/GNI target as most of its Nordic peers have done, it remains on track to reach this target by 2015. It was able to increase development assistance even in the wake of the 2008–09 financial crisis, but reduced its global development assistance by 4.3% in 2011. In an effort to reverse this decline, Finland's new Minister for Development Cooperation, Heidi Hautala, is seeking innovative financing solutions for development assistance.³ Furthermore, Hautala is aiming to reduce the number of Finland's sector priorities in order to improve existing programme effectiveness.⁴ Between 2006 and 2011 Finland contributed €18.6 million to the Global Fund.⁵ It does not contribute funds to GAVI or GAFSP.

Aid Effectiveness

Finland's best performance across the four dimensions of aid quality assessed by QuODA is in 'Transparency and Learning'. It also scores well in 'Fostering Institutions'. Finnish aid is amongst the most predictable, with one- and two-year predictability ratios of 104% and 102% in 2010. The percentage of Finnish bilateral ODA that is programmable at a country level (CPA) increased from 41% in 2005 to 48% in 2010.

Finland is also a signatory of the International Aid Transparency Initiative (IATI) and publishes according to its standards. After untying 92% of its aid in 2008, only 85% of its aid was untied in 2010. In order to further improve aid effectiveness, it should reduce the fragmentation of its development assistance. Only 32% of Finland's donor relationships with recipient countries were significant in 2010,⁶ the smallest proportion among the 16 donors assessed in this report.

Looking Ahead: 2012–15

Finland's global ODA target in 2015 is €1.46 billion. Between 2011 and 2015, it needs to increase its global ODA levels by €446.2 million. To stay on track, Finland needs to increase ODA by €111.5 million for 2011–12; the published EC projections estimate that it will increase ODA by €110.7 million in 2012.⁷ Finland's Africa ODA target in 2015 is €668.2 million. Between 2011 and 2015, it would need to increase annual ODA levels to the continent by €281.5 million, and by €70.4 million for 2011–12. Over 2012–13 it has pledged €7.6 million to the Global Fund.⁸ To help it reach its 2015 targets, the ongoing negotiations on the EU's Multi-Annual Financial Framework 2014–20 represent an opportunity, as Finland channels 15.3% of its global ODA through the EU institutions, equivalent to €155.1 million in 2011.

The Finnish Development Policy Action Plan, adopted in 2012, focuses on human rights, gender equality, climate sustainability and reduction of inequality, while aiming to help developing countries to become more self-sufficient.⁹ With two exceptions, all of Finland's priority countries identified for future support are located in sub-Saharan Africa: Ethiopia, Zambia, Tanzania, Kenya and Mozambique although only one-third of ODA in 2011 went to SSA.¹⁰

Finland's ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

Finland Notes

The EU collectively committed to provide 50% of global ODA increases to the African continent. Individual EU donors did not specify what proportion of their global ODA increases would go to Africa. It has therefore been assumed that each EU country would contribute 50% of its global ODA increases to Africa to meet the collective EU target.

The 2004 baseline averages multilateral disbursements over 2004 and 2005 to account for their ‘lumpiness’.

Ministry for Foreign Affairs of Finland. ‘The results of assistance, Burma and the Rio+20 Conference on the Development Ministers’ agenda in Brussels’. Press Release, 11 May 2012. http://formin.finland.fi/public/default.aspx?contentId=249080&nodeId=23&contentlan=2&culture=en-US.

Ministry for Foreign Affairs of Finland. ‘Suomen kehityspoliittinen toimenpideohjelma 2012‘ (Finnish Development Policy Programme 2012), 16 February 2012. http://formin.finland.fi/public/download.aspx?ID=91009&GUID={496FDBB0-9386-488F-97F9-2B10DC56A18C}.

‘Pledges and Contributions’ (spreadsheet). The Global Fund. Converted into euros using the DAC annual exchange rate conversions. http://www.theglobalfund.org/documents/core/financial/Core_PledgesContributions_List_en/ (as of 8 May 2012). 

For an explanation of ‘significant’ relationships between donor and recipient countries, see the Methodology section.

The 2012 projection has been taken from an April 2012 EC press release that gave ODA forecasts based on estimates provided by Member States. The difference in 2011 and 2012 ODA projections is due to ODA figures being in current prices and inclusive of debt relief while ONE monitors ODA increases exclusive of debt relief. However in the absence of 2012 figures exclusive of debt relief, global ODA figures including debt relief have been taken.

‘Pledges and Contributions’ (spreadsheet). The Global Fund. Op. cit.

Ministry for Foreign Affairs of Finland. ‘Finland Revises Its Course of Action on Development Policy’. Press release, 16 February 2012. http://formin.finland.fi/public/default.aspx?contentid=242137&nodeid=15145&contentlan=2&culture=en-US.

Ibid. The only non-African country exceptions are Nepal and Vietnam.

France's Progress 2004–11

France pledged to reach an interim target of 0.51% ODA/GNI in 2010, but its global ODA levels reached only 0.44% in that year, falling short of its target.¹ It also committed to disburse €5.27 billion of ODA to Africa (based on 50% of the increase to the global interim target)² in 2010; however, it directed only €4.03 billion to the continent and it actually reduced its aid to Africa by €543.2 million between 2010 and 2011.³ It met 41.2% of the targeted increases promised for 2010. Between 2004 and 2011, France increased its development assistance to the African continent by 10.4% (€328.2 million); development assistance to the sub-Saharan region increased by 19% (€454.6 million),⁴ while its overall development assistance increased by 42.2% (€2.52 billion).⁵

France has played a notable role in health funding, contributing €226.6 million to GAVI for 2004–11.⁶ Across 2004–11, it contributed a total of €2.04 billion to the Global Fund, making it the second largest contributor after the United States.⁷ France pledged €1.55 billion over 2009–11 under the L'Aquila Food Security Initiative;⁸ however, only €0.78 billion has been disbursed to date.⁹ It does not contribute to GAFSP.

In 2010, France adopted a major ten-year strategy, 'Development Cooperation: A French Vision'. This strategy differentiates partner countries according to their development levels and political situations and, based on these categories, sets out different partnership models. It also defines the objective of concentrating its most concessional bilateral aid instruments on 14 low-income countries in sub-Saharan Africa.¹⁰

Aid Effectiveness

According to the QuODA index, based on data from 2009 and 2010, France scores poorly in three out of four aid quality dimensions. Its best score is in 'Maximising Efficiency', where it ranks 14th out of 31 donor countries and institutions assessed. Its lowest ranking is in 'Transparency and Learning', where it ranks 28th out of 31. While French aid is amongst the least predictable of the EU donors, France has made progresss in untying aid. In 2010, 95% of its aid was untied. The amount of bilateral aid that was programmable at the country level (CPA) increased from 28% in 2005 to 53% in 2010. There are many areas in which France could increase the effectiveness of its aid, including building on its positive trend of increasing CPA and signing on to the International Aid Transparency Initiative (IATI) and publishing according to its standards.

Looking Ahead: 2012–15

Between 2011 and 2015, France needs to increase its global ODA levels by €6.58 billion to achieve its global target of €15.06 billion. For 2012, its total ODA would need to increase by €1.65 billion to stay on track towards this goal. To meet its 2015 target of €7.71 billion for Africa, France will need to increase relevant ODA levels by €4.22 billion between 2011 and 2015. This would necessitate an additional €1.06 billion in 2012. Between 2012 and 2015 France has pledged €304 million to GAVI.¹¹ It has also pledged €686.2 million to the Global Fund across 2012–13.¹²

France plans to increase its global ODA by only €1.12 billion in 2012,¹³ missing its target by nearly one-third. As it has increased the use of loans during the past few years,¹⁴ negative ODA flows could increase in the medium term, with developing countries repaying their loans. Aid to sub-Saharan Africa is also declining, especially to the poorest countries.¹⁵ As a new president was elected on 6 May and a new National Assembly was voted into office in June, France should seize this opportunity and work to live up to its ambitious commitments to remain a leader in development. In his response to the ONE VOTE,¹⁶ Francois Hollande has committed to adopt a 'programme law'¹⁷ in order to improve monitoring of the new development strategy. He also promised to define a road map towards 0.7% ODA/GNI and to increase the 'financial effort'¹⁸ of development assistance. France also channelled 20.7% of its aid budget through EU institutions in 2011, which amounted to €1.76 billion. An ambitious EU aid budget for 2014–20 will further bolster its aid levels towards its targets.

France's ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

France Notes

Including debt relief, France’s ODA/GNI ratio in 2010 was 0.5%.

The EU collectively committed to provide 50% of global ODA increases to the African continent. Individual EU donors did not specify what proportion of their global ODA increases would go to Africa. It has therefore been assumed that each EU country would contribute 50% of its global ODA increase to Africa to meet the collective EU target.

The decrease in 2011 was partly due to Mayotte becoming an overseas department of France. Funding for Mayotte can no longer be counted as ODA.

The increase in ODA for sub-Saharan Africa between 2004 and 2011 was slightly higher than the Africa region as a whole because in 2004 ODA to sub-Saharan Africa was much lower than ODA going to Africa.

The 2004 baseline averages multilateral disbursements over 2004 and 2005 to account for their ‘lumpiness’.

These were through direct contributions to GAVI and contributions through the IFFIm. GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions. http://www.gavialliance.org/funding/donor-contributions-pledges/.

‘Pledges and Contributions’ (spreadsheet). The Global Fund. Converted into euros using the DAC annual exchange rate conversions. http://www.theglobalfund.org/documents/core/financial/Core_PledgesContributions_List_en/ (as of 8 May 2012).

Using 2009 exchange rates sourced from the OECD DAC.

Camp David Accountability Report, May 2012. http://www.g8.utoronto.ca/summit/2012campdavid/CampDavidG8AccountabilityReport.pdf

Benin, Burkina Faso, Central African Republic, Chad, Comores, Democratic Republic of Congo, Ghana, Guinea, Madagascar, Mali, Mauritania, Niger, Senegal, Togo.

These pledges are through direct contributions to GAVI and through the IFFIm mechanism. GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Op. cit.

‘Pledges and Contributions’ (spreadsheet). The Global Fund. Op. cit.

The 2012 projection has been taken from an April 2012 EC press release that gave ODA forecasts based on estimates provided by Member States. The difference in 2011 and 2012 ODA projections is due to ODA figures being in current prices and inclusive of debt relief while ONE monitors ODA increases exclusive of debt relief. However, in the absence of 2012 figures exclusive of debt relief, global ODA figures including debt relief have been taken.

Bilateral loans have increased by 400% between 2008 and 2012. This percentage is based on the ‘Cross-Cutting Policy Document: French Policy in Favour of Development 2012’ (‘Document de politique transversale: Politique franaise en faveur du dveloppement 2012’). 

From 2008 to 2012, bilateral grants (‘subventions’), the key instrument for interventions in social sectors in least developed countries, were reduced by 13%. This percentage is based on the ‘Cross-Cutting Policy Document: French Policy in Favour of Development 2012’, op. cit.

http://www.one.org/fr/blog/one-vote-2012-francois-hollande-en-deuxieme-position/.

A programme law is a law that sets out the objectives of a public policy.

The notion of ‘financial effort’ refers to the concessional part of loans in ODA (and not the full amount) in order to better reflect the amount funded from the government budget. ONE’s definition of financial effort also includes bilateral grants, disbursements to multilateral agencies and humanitarian and food aid.

Germany's Progress: 2004–11

Germany did not meet its 2010 interim target of 0.51% ODA/GNI: with global ODA levels disbursed in 2010 reaching 0.38% of total GNI,¹ it fell €3.25 billion short of its €13.02 billion target. However, it is one of the few EU countries and one of only two G8 countries that increased its global ODA between 2010 and 2011. Due to these increases, Germany is currently the second largest donor worldwide. Its 2010 Africa target (based on 50% of the increase to the global interim target)² was €5.95 billion. It fell short of this target, with aid disbursements reaching €3.11 billion in 2010, meeting only 24.9% of the targeted increases. Between 2004 and 2011, Germany increased development assistance to Africa by 65.9% (€1.43 billion); development assistance to the sub-Saharan region, specifically, increased by 59.2% (€1.09 billion), while its global development assistance increased by 84.9% (€4.65 billion).³

Germany has maintained strong support for improved access to water and sanitation. Between 2004 and 2010, it directed more bilateral development assistance to this sector than any other EU15 country. In 2011, the German government pledged to double assistance to the education sector in Africa between 2009 and 2013, from €68.5 million to €137 million annually. Already in 2012, commitment authorisations to support education in Africa will reach, or potentially even exceed, the 2013 target.⁴

Germany also supports key partnerships in the health and agriculture sectors. Between 2004 and 2011, Germany contributed €1.08 billion to the Global Fund, making it the fourth largest contributing country.⁵ Its contributions to GAVI between 2006 and 2011 totalled €22.7 million.⁶ At the 2009 L'Aquila G8 Summit, it pledged to contribute €2.15 billion between 2010 and 2012, one-third of which was additional funding, and it is meeting that commitment.⁷ Germany does not contribute to GAFSP.

Aid Effectiveness

On the QuODA index measuring aid effectiveness, Germany ranks near the middle in 'Fostering Institutions' and 'Transparency and Learning'. However, it ranks below average in 'Reducing Burden' and even lower in 'Maximising Efficiency'. This is partly due to the small share of development assistance that it channels to poor countries. A key component in its low ranking was the previous fragmentation of multiple German agencies that delivered bilateral assistance. Following the merger of three development agencies in 2011, this sub-score should improve, however. The amount of German bilateral aid that was programmable at the country level (CPA) increased from 31% in 2005 to 50% in 2010. While Germany signed onto IATI in 2008, it has not yet complied with IATI publishing standards. However, it is in discussions with the IATI Secretariat about how to address this in the future. To improve the quality of its development assistance, Germany should direct a greater proportion of resources to poor countries, increase its proportion of CPA and begin publishing ODA information according to IATI standards.

Looking Ahead: 2012–15

Germany committed to increase global ODA to reach €19.51 billion by 2015. To meet this target, it needs to increase global ODA significantly by €9.38 billion between 2011 and 2015, which amounts to an annual increase of €2.35 billion for 2011–12. Germany's target for Africa in 2015 is €9.19 billion. Between 2011 and 2015, it needs to increase ODA levels to the continent by €5.59 billion to reach this target, with €1.4 billion needed for 2011–12. Between 2012 and 2014 Germany has pledged €46.1 million to GAVI.⁸ It has pledged €200 million annually to the Global Fund between 2012 and 2013.⁹

However, Germany's current budget efforts and ODA projections suggest that it will not meet these targets.¹⁰ The German government estimates that the 2012 budget allocations will lead to an ODA increase of €275.6 millionin 2012 (excluding debt relief).¹¹ According to the Cabinet-approved FY 2013 budgetary framework, Germany plans to continue with unambitious increases, with only a €152 million increase in ODA planned. Another cause for concern is the government's non-binding mid-term financial plan, which projects ODA cuts totalling €400 million in 2014, clearly thwarting any efforts to reach 0.7% and jeopardising Germany's current position as the world's second largest donor. Moving forward, Germany needs to drastically revise its budget allocations over the next three years to get on track to meet its 2015 targets. With 21.1% of its aid in 2011, or €2.13 billion, going through EU institutions, protecting development spending under the next EU budget would have a positive impact on future German aid levels.

Germany's ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

Germany Notes

GAVI Press Release. May 26, 2011. http://www.gavialliance.org/library/news/press-releases/2011/germany-increases-funding-for-gavi-to-%E2%82%AC30-million/.

GFATM Press Release. October 5, 2010. http://www.theglobalfund.org/en/mediacenter/pressreleases/Donors_commit_US$11_7_billion_to_the_Global_Fund_for_next_three_years/.

These increases have been calculated by taking the planned increases in the BMZ budget (Abschlussdes Einzelplans 23: http://www.bundesfinanzministerium.de/bundeshaushalt2012/pdf/epl23/s23abs.pdf) and adding the planned increases of the ODA portion of the budget of the Foreign Office (Einzelplan 05: http://www.bundesfinanzministerium.de/bundeshaushalt2012/html/ep05/ep05.html). In addition, there are potentially significant off-budget ODA resources in Germany’s new Energy and Climate Fund. However, even with optimistic estimates of disbursements for this fund, resources will fall short.

The 2012 projection has been taken from an April 2012 EC press release that gave ODA forecasts based on estimates provided by Member States. The difference in the 2011 and 2012 ODA projections is due to ODA figures being in current prices and inclusive of debt relief while ONE monitors ODA increases exclusive of debt relief. However, in the absence of 2012 ODA figures exclusive of debt relief, global ODA figures including debt relief have been taken.

Greece's Progress: 2004–11

Economic conditions in Greece have had a severe impact on the government's foreign assistance levels over the past five years. In 2010, Greece fell far short of its target of reaching 0.51% ODA/GNI. Its global ODA was only 0.17% of GNI, or €775.4 million less than its promised level. Its target for ODA to Africa (based on 50% of the increase to the global interim target)¹ was €511.7 million. It also fell short of this target, delivering only €120.7 million. Between 2004 and 2011, Greece increased its development assistance to Africa by 3.7% (€3.3 million); development assistance to the sub-Saharan region, specifically, increased by 14% (€9.2 million),² while its overall development assistance decreased by 26.1% (€83.8 million).³

In 2011, Greece cut its global development assistance budget by a further 39.3% to €237.9 million, or 0.11% of its GNI. Greece publishes very limited data on its development programmes, and has not yet published its 2011–15 five-year programme strategy. Greek development assistance is focused mostly on Balkan countries and other middle-income economies. Only one of Greece's top ten aid recipients in 2010 was classified as a least developed country.⁴ It last donated to the Global Fund in 2008 and has contributed €1.5 million in total (in 2005, 2007 and 2008),⁵ but it did not participate in the Second or Third Global Fund Replenishments. Greece does not contribute funds to GAVI or GAFSP.

Aid Effectiveness

Across all dimensions of aid quality analysed by QuODA, Greece performed poorly. In two of the four dimensions, it ranked 26th amongst the 31 donors. In both 'Fostering Institutions' and 'Maximising Efficiency', it was in the bottom two. It does score well in fragmentation, however: 76% of its donor relationships are significant.⁶ In 2005, 55% of Greece's bilateral ODA was channelled to countries as country programmable aid (CPA), but CPA decreased to only 36% in 2010. Furthermore, a large share of this assistance is tied – only 39% was untied in 2010 (down from 42% in 2007), ranking Greece at the bottom of the list in this category. Greece has progress to make in all dimensions of aid quality, especially in untying aid, allocating a greater share of ODA to poor countries and improving its aid evaluation policy. Greece is the only country assessed in this report that has not participated in the latest Paris Monitoring Surveys. As such, far less information is available about its aid quality and progress made. Greece should join the International Aid Transparency Initiative (IATI) and implement its standards of publishing to increase transparency on development assistance.

Looking Ahead: 2012–15

Greece's global ODA target in 2015 is €1.5 billion. Between 2011 and 2015, it needs to increase its annual ODA levels by €1.26 billion to reach this target. The estimated increase required in 2012 for Greece to be on track would be €314.7 million; however, the EC reported a projected decrease of €15.9 million in 2012.⁷ Greece's global ODA target for Africa in 2015 is €676.5 million. Between 2011 and 2015, it would need to increase its annual ODA levels to the continent by €584.3 million – a €146. 1 million increase for each year.

Despite Greece's economic turmoil in recent years, its 2011 DAC peer review maintains an optimistic perspective for the future, pointing out that the time is right for reform. However, Greece's economic outlook remains highly uncertain in both the short and medium terms. Earlier in 2012, the Greek government reached a restructuring deal that temporarily addressed some of the country's short-term fiscal issues. However, this has not eliminated the prospect of future debt restructuring or selective defaults, which could subject its development assistance budget to further scrutiny. Greece will need to undergo years of economic recovery before it can move forward with a cohesive development assistance strategy. In the meantime, Hellenic Aid should focus on increasing the efficiency and effectiveness of its existing aid budget. Given that it channelled 77.5% of all of its ODA through the EU institutions in 2011, the EC's proposal for development assistance in the next EU budget for 2014–20 represents a unique opportunity for the Greek government to scale up its aid efforts through its contributions in the coming years.

Greece's ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

Greece Notes

The EU collectively committed to provide 50% of global ODA increases to the African continent. Individual EU donors did not specify what proportion of their global ODA increases would go to Africa. It has therefore been assumed that each EU country would contribute 50% of its global ODA increase to Africa to meet the collective EU target.

The increase in ODA for sub-Saharan Africa between 2004 and 2011 was slightly higher than for the Africa region as a whole because in 2004 ODA to sub-Saharan Africa was much lower than ODA going to Africa.

The 2004 baseline averages multilateral disbursements over 2004 and 2005 to account for their ‘lumpiness’.

OECD DAC. ‘Greece Aid at a Glance.’ http://www.oecd.org/dataoecd/42/2/44284559.gif.

‘Pledges and Contributions’ (spreadsheet). The Global Fund. Converted into euros using the DAC annual exchange rate.http://www.theglobalfund.org/documents/core/financial/Core_PledgesContributions_List_en/ (as of 8 May 2012).

For an explanation of ‘significant’ relationships between donor and recipient countries, see the Methodology section.

The 2012 projection has been taken from an April 2012 EC press release that gave ODA forecasts based on estimates provided by Member States. The difference in 2011 and 2012 ODA projections is due to ODA figures being in current prices and inclusive of debt relief while ONE monitors ODA increases exclusive of debt relief. However, in the absence of 2012 figures exclusive of debt relief, global ODA figures including debt relief have been taken.

Ireland's Progress: 2004–11

Ireland pledged to reach a target of 0.51% ODA/GNI in 2010. It exceeded this commitment, with global ODA levels reaching 0.52% of total GNI. Its 2010 Africa target (based on 50% of the increase to the global interim target)¹ was €379.2 million, which it also exceeded, with levels of ODA disbursed to Africa in 2010 reaching €393.6 million. Between 2004 and 2011, Ireland increased development assistance to the African continent by 30.9% (€92.2 million); development assistance to the sub-Saharan region, specifically, increased by 31.5% (€90.8 million), while its overall development assistance increased by 32% (€157.8 million).²

Ireland has, for the most part, met its development assistance commitments, in terms of both quality and quantity. Its medium-term strategy, the Operational Plan for 2008–12, defines Irish Aid's core priorities: poverty reduction, and reducing vulnerability and increasing opportunities for the poor – largely in an African context.³ Additionally, it has published an Africa-specific strategy, 'Ireland and Africa: Our Partnership With a Changing Continent', which outlines goals that Irish Aid hopes to achieve. These include helping to improve domestic resource mobilisation and supporting improvements to business environments.⁴ Ireland's aid focuses on nine priority countries, which include seven in sub-Saharan Africa.⁵ In 2011, it provided 67% of its bilateral ODA to sub-Saharan African countries.⁶

Over 2004–10, Ireland contributed €113.4 million to the Global Fund; it did not make a new pledge for the Third Replenishment Round (2011–13).⁷ It has contributed €25 million to GAVI between 2004 and 2011,⁸ and has shown its commitment to food security programmes, being one of just three donor countries to respond to GAFSP's second call for proposals. As of April 2012, Ireland has contributed €0.5 million to GAFSP.⁹

Aid Effectiveness

Ireland's development assistance ranks very high on quality. It is in the top eight donors on all four dimensions of aid quality measured by QuODA. It ranks second out of 31 in both 'Fostering Institutions' and 'Reducing Burden' in partner countries, seventh in 'Transparency and Learning' and eighth in 'Maximising Efficiency'. All of its ODA has been untied since 2001. Ireland channels more money through country systems than any of the other EU15, with 84% of its ODA channelled through country systems for public financial management in 2010, and 91% through procurement country systems in 2010.

In order to further improve the quality of its development assistance, Ireland should decrease fragmentation by increasing the size of projects and ensuring that the share of ODA that each partner country receives remains high. It should also reverse the trend of decreasing its proportion of CPA, which declined from 65% in 2005 to 47% in 2010. Finally, Ireland is a signatory of the International Aid Transparency Initiative (IATI), but it should start publishing according to its standards.

Looking Ahead: 2012–15

Ireland's global ODA target in 2015 is €940.1 million. Between 2011 and 2015, it will need to increase its global ODA levels by €289.9 million to meet this target, which amounts to an increase of €72.5 million required in 2011–12. The EC's published projections, however, indicate that Irish ODA will decrease by €11.2 million in 2012.¹⁰ Ireland's ODA target for Africa in 2015 is €521.8 million. Between 2011 and 2015, it needs to increase ODA levels to the continent by €131.6 million, or by €32.9 million each year. Ireland has pledged €5.9 million to GAVI over 2012–14.¹¹

While it has cut budgets severely across the board, Ireland has not turned its back on the world's poor, with total ODA decreasing by only 3.1% between 2010 and 2011. The ongoing negotiation of the EU's seven-year budget, which should be concluded just ahead of Ireland's EU Presidency in January 2013, presents an opportunity for it to push for a greater focus on aid to Africa within the EU budget.

Ireland's ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

Ireland Notes

The EU collectively committed to provide 50% of global ODA increases to the African continent. Individual EU donors did not specify what proportion of their global ODA increases would go to Africa. It has therefore been assumed that each EU country would contribute 50% of its global ODA increase to Africa to meet the collective EU target.

The 2004 baseline averages multilateral disbursements over 2004 and 2005 to account for their ‘lumpiness’.

DAC Peer Review: Ireland. 2009.

Ireland. Department of Foreign Affairs and Trade/Irish Aid. ‘Ireland and Africa: Our Partnership with a Changing Continent’. 1 September 2011. http://www.irishaid.gov.ie/uploads/strategy_paper2.pdf. Accessed 18 April 2012.

‘Irish Aid – Overview – Partner Countries’. Irish Aid. http://www.dci.gov.ie/countries.html. Accessed 13 April 2012. The sub-Saharan African countries are Ethiopia, Uganda, Tanzania, Zambia, Malawi, Mozambique and Lesotho.

OECD DAC. ‘Ireland’. http://www.oecd.org/dataoecd/42/3/44284758.gif.

The Global Fund. ‘Pledges and Contributions’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions. http://www.theglobalfund.org/documents/core/financial/Core_Pledges.Contributions_List_en/ (as of May 8 2012).

These were through direct contributions. GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions. http://www.gavialliance.org/funding/donor-contributions-pledges/.

http://www.gafspfund.org/gafsp/content/funding.

The 2012 projection has been taken from an April 2012 EC press release that gave ODA forecasts based on estimates provided by Member States. The difference in 2011 and 2012 ODA projection is due to ODA figures being inclusive of debt relief while ONE monitors ODA increases exclusive of debt relief. However, in the absence of 2012 figures exclusive of debt relief, global ODA figures including debt relief have been taken.

These pledges are through direct contributions. GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Op. cit.

Italy's Progress 2004–11

Although Italy was one of the few DAC donors to increase its ODA in 2011, it has consistently fallen short of its development assistance targets over the past few years. In 2010, it pledged to increase ODA to reach 0.51% of GNI. It fell €5.78 billion short of this target, reaching just 0.14%.¹ Italy's 2010 target for Africa (based on 50% of the increase to the global interim target)² was 3.82 billion. It met -9.1% of this target, delivering less development assistance in 2010 than it did in 2004. Between 2004 and 2011, Italy increased development assistance to the African continent by 22.3% (€259.8 million); its development assistance to the sub-Saharan region, specifically, increased by 2.8% (€26.9 million), while its overall development assistance increased by 1.8% (€46.1 million).³

In its 2008–11 Economic and Financial Planning Document, Italy outlined a non-binding roadmap for reaching 0.51% by 2010. At the 2009 G8 Summit hosted in L'Aquila, the then Prime Minister, Silvio Berlusconi, announced a piano de rientro, or a plan to restore development assistance. He also reaffirmed Italian commitments to food security and global health issues.⁴ While Italy has met its modest L'Aquila commitments, it reduced contributions to the World Food Programme between 2009 and 2010.⁵ In 2009, it committed €307 million as part of its L'Aquila promises.⁶ As of 2012, it had disbursed €371 million.⁷ Italy contributed €257.3 million to GAVI between 2006 and 2011⁸ and €602.6 million to the Global Fund over the 2004–08 period.⁹ However, it has not yet met its 2009 or 2010 commitments, amounting to €253.8 million in unpaid pledges.¹⁰ Italy does not contribute funds to GAFSP.

Aid Effectiveness

Despite increased efforts in recent years, Italy scores below average across all four dimensions of aid effectiveness in the QuODA index, performing particularly poorly on 'Transparency and Learning', where it ranks 29th of the 31 donor countries and institutions assessed. The proportion of untied Italian aid decreased from 60% in 2007 to 58% in 2010. More positively, Italy increased its proportion of country programmable aid (CPA) from 20% in 2005 to 51% in 2010. Its performance on fragmentation has also improved, with the proportion of significant relationships¹¹ increasing from 34% in 2007 to 47% in 2010, as it has focused its aid on a smaller number of countries. Italy should continue to untie its aid, increase the proportion of ODA that countries receive as CPA, and support recipient country priorities. It should also join the International Aid Transparency Initiative (IATI) and uphold its aid publishing standards.

Looking Ahead: 2012–15

Italy's global ODA target in 2015 is €11.44 billion. To reach this target, it needs to increase its global ODA by €8.8 billion between 2011 and 2015. For 2011–12, this means a €2.2 billion increase. However, the EC projects that Italy will reduce aid flows by €1.17 billion in 2012, thereby reducing its ODA/GNI ratio to 0.12%.¹² Italy's ODA target for Africa in 2015 is €5.59 billion. To meet this target, it needs to increase ODA to the continent by €4.16 billion between 2011 and 2015, and by €1.04 billion between 2011 and 2012. Italy has pledged €265.6 million to GAVI over the 2012–15 period,¹³ while it made no pledges for the Global Fund for 2012–13.¹⁴

In 2011, Italy's increased ODA disbursements were driven partly by increased commitments to debt relief initiatives.¹⁵ However, maintaining the upward trend of aid spending and its relative prioritisation within very tight budgets sends an important international signal. In November 2011, Silvio Berlusconi stepped down as Prime Minister and was replaced by Mario Monti. Prime Minister Monti created Italy's first Ministry for International Cooperation and Integration, headed by Andrea Riccardi,¹⁶ to which the Development Cooperation Department now reports. Previously, development assistance was managed through the Ministry of Foreign Affairs. Italy should build on these reforms by committing to focus its programmes on poverty eradication; this should include the Ministry outlining a roadmap for meeting its aid commitments. As Italy channels 52.9% of its aid through the EU, the ongoing negotiation of the EU's seven-year budget for 2014–20 presents an opportunity for it to push for a greater focus on Africa within the EU budget and to make progress towards its aid targets.

Italy's ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

Italy Notes

Including debt relief, Italy’s global ODA disbursements reached 0.15% in 2010.

The EU collectively committed to provide 50% of global ODA increases to the African continent. Individual EU donors did not specify what proportion of their global ODA increases would go to Africa. It has therefore been assumed that each EU country would contribute 50% of its global ODA increase to Africa to meet the collective EU target.

The 2004 baseline averages multilateral disbursements over 2004 and 2005 to account for their ‘lumpiness’.

Italian Ministry of Economics and Finances. 28 June 2007. ‘2008–2011 Economic and Financial Planning Document’ http://www.bv.ipzs.it/bv-pdf/001/MOD-VP-07-1-25_602_1.pdf.

OECDStat. http://stats.oecd.org/.

Converted into euros using OECD DAC 2009 exchange rates.

‘Camp David Accountability Report’, p.23. (http://www.state.gov/documents/organization/189889.pdf). The G8 accountability report uses the 2009 annual average exchange rate to convert from € to USD (0.7181).

Through the AMC and IFFIm. GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions. http://www.gavialliance.org/funding/donor-contributions-pledges/.

The Global Fund. ‘Pledges and Contributions’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions.
http://www.theglobalfund.org/documents/core/financial/Core_Pledges.Contributions_List_en/ (as of May 8 2012).

Ibid.

For an explanation of ‘significant’ relationships between donor and recipient countries, see the Methodology section.

The 2012 projection has been taken from an April 2012 EC press release that gave ODA forecasts based on estimates provided by Member States. The difference in 2011 and 2012 ODA projections is due to ODA figures being in current prices and inclusive of debt relief while ONE monitors ODA increases exclusive of debt relief. However, in the absence of 2012 figures exclusive of debt relief, global ODA figures including debt relief have been taken.

GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Op. cit.

The Global Fund. ‘Pledges and Contributions’ (spreadsheet). Op. cit.

OECD. 4 April 2012. ‘Development: Aid to developing countries falls because of global recession’. http://www.oecd.org/document/3/0,3746,en_21571361_44315115_50058883_1_1_1_1,00.html.

Andrea Riccardi. Press release, 16 November 2011. ‘Andrea Riccardi Appointed New Italian Minister For International Cooperation’. http://www.andreariccardi.it/en/press/andrea-riccardi-appointed-new-italian-minister-for-international-cooperation.

Luxembourg's Progress: 2004–11

Luxembourg consistently provides over 1.0% of its GNI as development assistance, making it one of only five countries globally that currently exceed the 0.7% ODA/GNI target. In 2010, it surpassed its standing 1.0% ODA/GNI target by €14 million, with global ODA levels disbursed reaching 1.05% of total GNI.¹ However, it reduced its global ODA by roughly 5.4% between 2010 and 2011. Luxembourg's 2010 target for Africa (based on 50% of the increase to the global interim target)² was €137.8 million, which it also exceeded. It met 130.3% of its target increases committed for 2010. Between 2004 and 2011, Luxembourg increased its development assistance to Africa by 17.9% (€20.1 million); its development assistance to the sub-Saharan region increased by 19% (€19.7 million), while its overall development assistance increased by 19.1% (€47.7 million).³

Luxembourg has just 10 partner countries, with programmes managed by six regional offices.⁴ Roughly 40% of its bilateral development assistance is directed to sub-Saharan African countries, mostly to countries in Francophone West Africa. Between 2005 and 2011 Luxembourg contributed €5.7 million to GAVI through direct contributions.⁵ It contributed €18.1 million to the Global Fund for the 2004–11 period.⁶ Luxemburg does not contribute to GAFSP.

Aid Effectiveness

Luxembourg scores fairly well in two of the four dimensions of aid quality as measured by the QuODA index. It ranks 13th out of 31 in 'Maximising Efficiency' and 16th of 31 in 'Reducing Burden'. However, it scores very poorly on the other two dimensions, ranking 29th in 'Fostering Institutions' and 30th in 'Transparency and Learning'. The share of its bilateral ODA classified as CPA decreased from 73% in 2005 to 67% in 2010. In 2008, 100% of its bilateral ODA was untied, and 99% was untied in 2010. In order to improve its aid quality, Luxembourg should focus on channelling its development assistance through country systems, as only 5% of its assistance was channelled in this way in 2010. It could also improve its evaluation policy and the transparency of its aid information; Lux-Development has only been publishing limited project evaluation reports since 2009. Luxembourg should also join the International Aid Transparency Initiative (IATI) and implement its standards of publishing.

Looking Ahead: 2012–15

Luxembourg's global ODA target in 2015 is €321.1 million. Between 2011 and 2015, it needs to increase global ODA levels by €23.8 million to maintain its standing 1.0% ODA/GNI target. Although Luxembourg needs to increase ODA by €5.9 million in 2012 to remain on track, the EC forecasts that it will actually decrease development assistance in 2012 by €2.3 million.⁷ Its ODA target for Africa in 2015 is €148.2 million. Between 2011 and 2015, Luxembourg needs to increase ODA levels to Africa by €15.6 million, or by €3.9 million for 2011–12.⁸ Luxembourg pledged €3.4 million in direct contributions to GAVI for 2012–15 and €4.8 million to the Global Fund for the 2012–13 period.⁹ In 2011, it signed a four-year pact with the World Food Programme (WFP) for €31 million, which will support nutrition activities in West Africa.¹⁰ It is also the WFP's largest per capita donor.

In May 2012, Luxembourg passed a law modernising its development cooperation, which included setting up an inter-ministerial committee tasked with advising on the coherence of its development policies.¹¹ Public support in the country for international assistance remains among the highest in Europe, according to a recent Eurobarometer poll,¹² which should encourage the government to maintain relative ODA volumes in future years. Luxembourg should assume its leadership role in the EU-wide effort to reach the collective 0.7% target by 2015 and needs to come out clearly in favour of a strong aid budget during the ongoing negotiations on the EU Multi-Annual Financial Framework (MFF). The MFF process represents a major opportunity for the EU to keep its promises to the world's poor, and Luxembourg's support for the €51 billion that is currently proposed for development assistance would have a significant leveraging effect on those Member States that are currently struggling to reach their individual aid targets.

Luxembourg's ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

Luxembourg Notes

Including debt relief, Luxembourg’s global ODA disbursements reached 1.05% in 2010.

The EU collectively committed to provide 50% of global ODA increases to the African continent. Individual EU donors did not specify what proportion of their global ODA increases would go to Africa. It has therefore been assumed that each EU country would contribute 50% of its global ODA increase to Africa to meet the collective EU target.

The 2004 baseline averages multilateral disbursements over 2004 and 2005 to account for their ‘lumpiness’.

Lux-Development S.A. ‘Country Partners’. http://www.lux-development.lu/pays.lasso?lang=uk. Accessed 14 April 2012.

GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions. http://www.gavialliance.org/funding/donor-contributions-pledges/.

The Global Fund. ‘Pledges and Contributions’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions. http://www.theglobalfund.org/documents/core/financial/Core_PledgesContributions_List_en/ (as of 8 May 2012).

The 2012 projection has been taken from an April 2012 EC press release that gave ODA forecasts based on estimates provided by Member States. The difference in 2011 and 2012 ODA projections is due to ODA figures being in current prices and inclusive of debt relief while ONE monitors ODA increases exclusive of debt relief. However, in the absence of 2012 figures exclusive of debt relief, global ODA figures including debt relief have been taken.

GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Op. cit.

The Global Fund. ‘Pledges and Contributions’ (spreadsheet). Op. cit.

WFP. ‘Statement by WFP Executive Director Josette Sheeran on New Partnership with Luxembourg’. 15 September 2011. http://www.wfp.org/news/news-release/statement-world-food-programme-executive-director-josette-sheeran-new-partnership-.

Official Journal of the Grand Duchy of Luxembourg. 1 June 2012. ‘Law of 9 May 2012 modifying the modified law of 6 January 1996 on development cooperation.’

European Commission. 2011. Special Barometer 375: ‘Making a Difference in the World: Europeans and the future of development aid’. In this poll, 92% of Luxembourg respondents said that helping people in developing countries was important.

The Netherlands' Progress: 2004–11

Since 1975, the Netherlands has consistently met or exceeded 0.7% ODA as a percentage of GNI.¹ It pledged to reach a target of 0.8% ODA/GNI in 2010 but did not do so, with global ODA levels disbursed in 2010 reaching 0.75% of total GNI, leaving a shortfall of €293 million.² The 2010 Africa target (based on 50% of the increase to the global interim target)³ was €2.24 billion, but the Netherlands disbursed only €1.19 billion of ODA to Africa in 2010, which was lower than the amount it gave to the continent in 2004. Between 2004 and 2011, it reduced development assistance to Africa by 14.4% (€230.7 million); development assistance to the sub-Saharan region, specifically, decreased by 13.2% (€195 million). However, the Netherlands increased its overall development assistance by 27.7% (€967.2 million), indicating a prioritisation of regions other than Africa.⁴

In 2011, just 21.1% of Dutch bilateral development assistance⁵ went to sub-Saharan African countries, a low proportion in comparison with other European countries. However, in 2010, three of the top five recipients of Dutch bilateral ODA were located in the region: Ghana, Mozambique and Tanzania.⁶ Between 2004 and 2011, the Netherlands contributed €481.7 million to the Global Fund.⁷ In addition, the Netherlands, one of GAVI's six original donor countries, contributed €148.5 million to GAVI between 2004 and 2011.⁸ As of 2012, the Netherlands contributed €100 million to GAFSP.⁹

Aid Effectiveness

The Netherlands ranks 11th out of 31 donors in two aid quality dimensions measured by the QuODA index, 'Fostering Institutions' and 'Reducing Burden'. However, it ranks below average in 'Transparency and Learning' and 'Maximising Efficiency'. Dutch development assistance has become more fragmented, with the proportion of significant relationships¹⁰ decreasing from 58% in 2007 to 42% in 2010. The percentage of bilateral Dutch aid that is programmable at the country level (CPA) also decreased from 38% in 2005 to 29% in 2010. However, the Netherlands has made good progress in decreasing tied aid – from 81% untied in 2007 to 94% untied in 2010. It is a signatory of the International Aid Transparency Initiative (IATI) and conforms to its publishing standards. In order to further increase the quality of its aid, the Netherlands should improve project-level data, increase predictability and specialisation by sector, and put in place a quality evaluation policy.

Looking Ahead: 2012–15

In 2010, the previous Dutch government, which fell in April 2012, announced that it would reduce its development assistance target from 0.8% to 0.7% ODA/GNI for that government's legislative period; the only EU country to have reduced its global ODA/GNI target between 2010 and 2015. Its new global ODA target, based on 0.7% ODA/GNI, is €4.47 billion in 2015. To achieve this target, it would only need to increase global annual ODA levels by €8.7 million between 2011 and 2015. For 2012, this translates into an increase of €2.2 million, while the EC projects a decrease of €486.3 million.¹¹ Due to the reduction of its ODA/GNI target, the Netherlands' global ODA target for Africa in 2015 is €2.09 billion, less than its 2010 Africa target. Between 2011 and 2015, it needs to increase ODA levels to the continent by €718.6 million, or €179.7 million annually to achieve this target. Between 2012 and 2015 the Netherlands has pledged €161.8 million to GAVI.¹² It has pledged €76.2 million to the Global Fund across 2012–13.¹³

In 2011, the Netherlands adopted a new development cooperation policy, which shifts Dutch aid away from social sectors towards economic sectors, relies more on the private sector, and protects Dutch national interests.¹⁴ The policy also outlines major spending cuts, reducing education and health-care spending by €95 million and €33 million respectively.¹⁵ Furthermore, the number of partner countries has been reduced from 33 to 15.¹⁶ Ten of the remaining countries are located in sub-Saharan Africa. The Netherlands' economic situation required severe budget cuts in 2012. In April, the government fell and Parliament approved a new budget package in which additional proposed cuts to ODA were abandoned. When the new government takes office, it must ensure that development spending is maintained at 0.7% of GNI to continue the Netherlands' 26-year record as a leader in development assistance.

The Netherlands' ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

The Netherlands Notes

DAC Peer Review: Netherlands. 2011.

It did, however, meet its 2010 global ODA/GNI target if assessing ODA levels inclusive of debt. In 2010, its ODA including debt as a percentage of GNI was 0.81%, and it exceeded its target by €89 million.

The EU collectively committed to provide 50% of global ODA increases to the African continent. Individual EU donors did not specify what proportion of their global ODA increases would go to Africa. It has therefore been assumed that each EU country would contribute 50% of its global ODA increase to Africa to meet the collective EU target.

The 2004 baseline averages multilateral disbursements over 2004 and 2005 to account for their ‘lumpiness’.

Exclusive of debt relief.

Bilateral ODA disbursements taken from DAC and exclusive of net debt relief.

The Global Fund. ‘Pledges and Contributions’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions. http://www.theglobalfund.org/documents/core/financial/Core_PledgesContributions_List_en/ (as of 8 May 2012).

Through direct contributions and through the IFFIm. GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions. http://www.gavialliance.org/funding/donor-contributions-pledges/.

http://www.gafspfund.org/gafsp/content/funding.

For an explanation of ‘significant’ relationships between donor and recipient countries, see the Methodology section.

The 2012 projection has been taken from an April 2012 EC press release that gave ODA forecasts based on estimates provided by Member States. The difference in 2011 and 2012 ODA projections is due to ODA figures being in current prices and inclusive of debt relief while ONE monitors ODA increases exclusive of debt relief. However, in the absence of 2012 ODA figures exclusive of debt relief, global ODA figures including debt relief have been taken.

Through direct contributions and the IFFIm. GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Op. cit.

‘Pledges and Contributions’ (spreadsheet). The Global Fund. Op. cit.

Netherlands Ministry of Foreign Affairs. Parliamentary Letter, 18 March 2011, presenting the new focus of development cooperation policy. http://www.minbuza.nl/binaries/content/assets/minbuza/en/import/en/key_topics/development_cooperation/dutch_development_policy/parliamentary-letter-of-march-18-2011-presenting-the-new-focus-of-development-cooperation-policy/parliamentary-letter-of-march-18-2011-presenting-the-new-focus-of-development-cooperation-policy/hippogallery%3Aasset.

Netherlands Ministry of Foreign Affairs. ‘Foreign Affairs Budget 2011–2012’. http://www.minbuza.nl/en/ministry/policy-and-budget/foreign-affairs-budget-2011-2012.html.

Netherlands Ministry of Foreign Affairs. ‘Dutch Development Policy’. http://www.minbuza.nl/en/key-topics/development-cooperation/dutch-development-policy.

Portugal's Progress: 2004–11

Portugal pledged to reach 0.51% ODA/GNI in 2010, but it fell short of its target by €365. 1 million and reached only 0.29%.¹ The 2010 Africa target (based on 50% of the increase to the global interim target)² was €437.3 million. Portugal fell short of this target, with aid disbursements in 2010 reaching only €308.4 million. It met 54.2% of the target increases promised for 2010. Between 2004 and 2011, Portugal increased development assistance to Africa by 124.9% (€194.8 million); its development assistance to sub-Saharan Africa increased by 136.4% (€197.5 million),³ while its overall development assistance increased by 61.4% (€182.9 million).⁴

In 2011, Portugal allocated roughly 87% of its bilateral development assistance to sub-Saharan countries.⁵ Major recipients include the Lusophone countries: Angola, Cape Verde, Guinea-Bissau, Mozambique and São Tomé and Príncipe. Most of Portugal's focus countries are fragile states.

In 2005, the Portuguese Ministry of Foreign Affairs published the 'Strategic Vision for Portuguese Cooperation', which outlined guiding principles for the country's aid programme, including its commitment to the MDGs and sustainable social and economic development.⁶ In 2010, 20% of its development assistance was channelled to the education sector and a further 20% towards social infrastructure projects.⁷ Portugal made contributions of €11.3 million to the Global Fund between 2004 and 2010,⁸ but it does not contribute funds to GAVI or GAFSP.

Aid Effectiveness

On the QuODA index, Portugal performs in the top ten of the 31 donor countries and institutions assessed in terms of 'Maximising Efficiency' and 'Reducing Burden'. It ranks below average, however, on 'Fostering Institutions' (although it is improving) and close to the bottom on 'Transparency and Learning'. Portugal increased its proportion of CPA from 65% in 2005 to 85% in 2010, achieving the second highest proportion among the EU donors measured in this report. However, its untied aid decreased from 58% in 2007 to 43% in 2010. In its 2010 Peer Review, the DAC noted that Portugal is addressing many of the recommendations made by the last peer review conducted in 2006 to improve the way in which it delivers development cooperation.⁹ Portugal should continue these efforts by further untying aid, increasing its use of country systems, strengthening mutual accountability mechanisms and improving the tracking of country-level indicators. It should also improve the transparency and predictability of its aid by joining the International Aid Transparency Initiative (IATI).

Looking Ahead: 2012–15

Portugal's global ODA target in 2015 is €1.17 billion. Between 2011 and 2015, it needs to increase global ODA levels by €689. 1 million to meet this target. It would need to increase ODA by €172.3 million in 2012 to stay on track, but the EC's published projections forecast a decrease of €10 million in 2012.¹⁰ Portugal's ODA target for Africa in 2015 is €592 million. Between 2011 and 2015, it would need to increase ODA levels to the continent by €241.2 million, or an annualised level of €60.3 million in 2012. Portugal did not pledge funds to the Global Fund for 2012–13 or to GAVI for 2012–15.

Portugal has yet to roll out a concrete strategy to reach its 0.7% target by 2015.¹¹ At the same time, economic projections point to a further contraction in its economic activity in 2012, followed by stagnation in 2013.¹² This context and a tight fiscal framework mean that public expenditure, including aid, will be under pressure. In the meantime, Portugal should continue its efforts to improve the effectiveness of its aid. Given that 27.2% of its aid is channelled through the EU, it can achieve progress towards its ODA targets by continuing to support the €51 billion in proposed funding for development under the next EU budget for 2014–20.

Portugal's ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

Portugal Notes

Including debt relief, Portugal’s global ODA disbursements reached 0.29% in 2010.

The EU collectively committed to provide 50% of global ODA increases to the African continent. Individual EU donors did not specify what proportion of their global ODA increases would go to Africa. It has therefore been assumed that each EU country would contribute 50% of its global ODA increase to Africa to meet the EU target.

The increase in ODA for sub-Saharan Africa between 2004 and 2011 was slightly higher than for the Africa region as a whole because in 2004 ODA to sub-Saharan Africa was much lower than ODA going to Africa.

The 2004 baseline averages multilateral disbursements over 2004 and 2005 to account for their ‘lumpiness’.

Exclusive of debt relief.

IPAD. ‘Portuguese Development Cooperation 2005–2010’. Portugal has not yet released the new Strategic Vision, although it has released an assessment of the 2005 plan. It has published sector strategies for education, multilateral cooperation, gender equality and national security.

DAC. ‘Portugal: Aid at a Glance’; Portugal Development Cooperation Institute (IPAD). ‘Portuguese Development Cooperation 2005–2010’. http://www.ipad.mne.gov.pt/CentroRecursos/Documentacao/EdicoesProprias/Estudos/Documents/Portuguese%20Development%20Cooperation%202005-2010.pdf.

The Global Fund. ‘Pledges and Contributions’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions http://www.theglobalfund.org/documents/core/financial/Core_PledgesContributions_List_en/ (as of 8 May 2012).

DAC Peer Review: Portugal. 2010.

The 2012 projection has been taken from an April 2012 EC press release that gave ODA forecasts based on estimates provided by Member States. The difference in 2011 and 2012 ODA projections is due to ODA figures being in current prices and inclusive of debt relief while ONE monitors ODA increases exclusive of debt relief. However, in the absence of 2012 ODA figures exclusive of debt relief, ODA figures including debt relief have been taken.

DAC Peer Review: Portugal. 2010.

Banco de Portugal. ‘Economic Bulletin, Spring 2012’. http://www.bportugal.pt/enUS/EstudosEconomicos/Publicacoes/BoletimEconomico/Publications/projecoes_e.pdf.

Spain's Progress: 2004–11

Spain pledged to reach a 0.56% ODA/GNI target in 2010,¹ but fell short of this by roughly €1.66 billion. Global ODA levels disbursed in 2010 reached 0.4% of total GNI.² Its 2010 Africa target (based on 50% of the increase to the global interim target)³ was €2.63 billion; it also fell short of this target, with levels of ODA disbursed to Africa reaching €1.39 billion in 2010. This meant that it met 34.3% of the target increases promised to Africa for 2010. Between 2004 and 2011, Spain increased development assistance to Africa by 51.2% (€383.2 million); its development assistance to the sub-Saharan region increased by 70.1% (€377.7 million), while its overall development assistance increased by 38.2% (€840.6 million).⁴

In 2011, Spain received high marks from the DAC's peer review, which stated that it had made strong progress in both the quantity and quality of its aid.⁵ This praise came despite a slight decrease in its total ODA volume between 2009 and 2010. However, further cuts to Spanish development assistance took place in 2011 as a result of deteriorating fiscal conditions and the ongoing debt crisis. These cuts reduced Spain's total ODA budget by 29.2% between 2010 and 2011.

In recent years, Spain has made significant contributions to the Global Fund (€499.7 million during the 2004–10 period)⁶ and the GAVI Alliance (€82.2 million between 2006 and 2011).⁷ Spain is a founding member of GAFSP, pledging €70 million to date.⁸ In February 2012, Spanish Minister for Foreign Affairs and Cooperation, José Manuel García-Margallo, announced the resumption of contributions to the Global Fund, GAVI and GAFSP after a freeze on contributions the previous years.⁹

Aid Effectiveness

In terms of ODA effectiveness, Spain ranks in the bottom third on three of the four QuODA dimensions. Its best performance was in terms of 'Transparency and Learning', with a rank of 13th out of 31 donor countries and institutions. The proportion of Spanish assistance channelled through country financial management systems increased from 17% in 2005 to 54% in 2010, and in procurement country systems from 14% in 2005 to 65% in 2010. The share of its bilateral ODA classified as CPA increased from 37% in 2005 to 48% in 2010. Spain is a signatory of the International Aid Transparency Initiative mmes.

Looking Ahead: 2012–15

Spain's global ODA target in 2015 is €7.82 billion. Between 2011 and 2015, it needs to increase global ODA levels by €4.78 billion, which would amount to an annualised increase of €1.2 billion required in 2012. However, Spain's draft 2012 budget included a €1.4 billion cut to development assistance, and is currently under debate as this report goes to print.¹⁰ Spain's ODA target for Africa in 2015 is €3.56 billion. Between 2011 and 2015, it needs to increase ODA levels to the continent by €2.43 billion, or by €606.9 million each year.

The '2013–2016 Master Plan of the Spanish Cooperation' is forthcoming and will outline Spain's foreign assistance-oriented goals over the coming years. For the period 2012–15, it has pledged €38.5 million to GAVI.¹¹ While Spain has attempted to resume programmes that had previously been cut, it remains unclear whether it can overcome the significant budgetary pressures it faces and still meet its 0.7% ODA/GNI target by 2015. With 27.6% of its ODA being channelled through the EU in 2011, it is in Spain's interests to protect the proposed funding for development under the EU budget for 2014–2020 in negotiations with other Member States.

Spain's ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

Spain Notes

Spanish Ministry of Foreign Affairs and Cooperation. 13 February 2009. ‘Master Plan for the Spanish Development Cooperation 2009-2012’. http://www.maec.es/es/MenuPpal/CooperacionInternacional/Publicacionesydocumentacion/Documents/lineasmaestras09-12_En.pdf.

Including debt relief, Spain’s global ODA disbursements reached 0.43% in 2010.

The EU collectively committed to provide 50% of global ODA increases to the African continent. Individual EU donors did not specify what proportion of their global ODA increases would go to Africa. It has therefore been assumed that each EU country would contribute 50% of its global ODA increase to Africa to meet the EU target.

The 2004 baseline averages multilateral disbursements over 2004 and 2005 to account for their ‘lumpiness’.

DAC Peer Review: Spain. 2011.

The Global Fund. ‘Pledges and Contributions’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions http://www.theglobalfund.org/documents/core/financial/Core_PledgesContributions_List_en/ (as of 8 May 2012).

GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions. http://www.gavialliance.org/funding/donor-contributions-pledges/.

Global Agriculture and Food Security Program. http://www.gafspfund.org/gafsp/content/funding. Accessed 11 May 2012.

Bill & Melinda Gates Foundation. ‘Bill Gates’ Statement on Spain’s International Aid Commitment’. 23 February 2012. http://www.gatesfoundation.org/press-releases/pages/spain-international-aid-commitment-120227.aspx.

Spanish Ministry of Finance and Public Administration. 3 April 2012. ‘The Government presents to the parliament a demanding State Budget to guarantee the compliance with the deficit’. http://www.minhap.gob.es/Documentacion/Publico/GabineteMinistro/Notas%20Prensa/2012/SE%20PRESUPUESTOS%20Y%20GASTOS/03-04-12%20Presentaci%C3%B3n%20PGE%202012.pdf.

Bill & Melinda Gates Foundation, op. cit.

Sweden's Progress: 2004–11

Sweden is one of only five countries globally to currently exceed 0.7% ODA/GNI, and it has maintained this level every year since 1975.¹ In 2010, it fell just short of its standing 1.0% ODA/GNI target, with global ODA levels disbursed reaching 0.97% of total GNI. Its 2010 Africa target (based on 50% of the increase to the global interim target)² was €1.5 billion, which it also fell just short of meeting, with levels of development assistance disbursed in 2010 reaching €1.23 billion. It met 48.9% of the target increases promised to Africa between 2004 and 2010. Between 2004 and 2011, Sweden increased its development assistance to the African continent by 54.5% (€530.7 million); it increased its development assistance to sub-Saharan Africa by 57.9% (€514.3 million), and its overall development assistance by 44.4% (€1.2 billion).³

Roughly two-thirds of Swedish ODA commitments are bilateral, and are managed by the Swedish International Development Agency (Sida). In addition to a broad commitment to poverty reduction and achievement of the MDGs by 2015, Sweden has identified three thematic priorities for development cooperation: 1) democracy and human rights; 2) environment and climate change; and 3) gender equality and the role of women. Most of its top bilateral ODA recipients are sub-Saharan African countries, including Tanzania, Sudan, Mozambique and Democratic Republic of Congo. Between 2004 and 2011 Sweden contributed €163.6 million to GAVI.⁴ Additionally, between 2004 and 2011 its contributions to the Global Fund totalled €443.4 million.⁵ Sweden does not contribute funds to GAFSP.

Aid Effectiveness

Since 2007, Sweden has significantly reduced the number of its bilateral partners to 30 countries (down from 125).⁶ It was ranked in the top ten donors in three of the four dimensions of aid quality by QuODA, but scored poorly on 'Maximising Efficiency'. Swedish ODA is amongst the most predictable compared with other DAC donors, with one-year predictability ratios of 101% in 2009 and 2010. Sweden increased the proportion of its ODA channelled through public financial management country systems from 47% in 2005 to 71% in 2010, and through procurement country systems from 45% in 2005 to 76% in 2010. All of its development assistance was untied in 2007 and 2008, but this decreased slightly to 95% in 2010. However, only 43% of Sweden's bilateral ODA was channelled to partner governments in the form of CPA in 2010, down from 55% in 2005. Sweden is already publishing to IATI standards, and the Swedish Agency for Development Evaluation (SADEV) has made great strides in tracking and assessing Sida's operations by launching a comprehensive database with information on every one of its development projects.⁷ While these efforts are very laudable, more could be done within IATI and in applying Sweden's transparency standards to its engagement with the private sector.

Looking Ahead: 2012–15

Sweden's projected global ODA target in 2015 is €4.28 billion, which means that between 2011 and 2015 it needs to increase its global ODA levels by €372.8 million to maintain its standing 1.0% ODA/GNI ratio. For 2012, the annual increase required is €93.2 million, while the EC's published projections estimate an increase of €26 million.⁸ Sweden's ODA target for Africa in 2015 is €1.76 billion. Between 2011 and 2015, it will need to increase ODA levels to the continent by €255.3 million, or by €63.8 million each year. Over the 2012–15 period, Sweden has pledged €94.8 million to GAVI.⁹ It has pledged €149.9 million to the Global Fund across 2012–13.¹⁰

Sweden's progress on aid effectiveness measures is likely to improve, as the government plans to present an 'Assistance Policy Platform' in 2012 that will strive to make its aid more results focused and to create a single strategy for its development policy.¹¹ Moreover, as part of its 2010 Transparency Guarantee, the Swedish government has launched the web-based platform 'Openaid.se', which will eventually include information on all Swedish authorities and ministries that manage aid funds, and not just Sida.¹² While Sweden channels only 6.9% (€271.1 million in 2011) of its total ODA through the EU institutions, it has been a political champion in supporting a strong development budget in the negotiations on the EU Multi-Annual Financial Framework 2014–20.

Sweden's ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

Sweden Notes

DAC Peer Review: Sweden. 2009

The EU collectively committed to provide 50% of global ODA increases to the African continent. Individual EU donors did not specify what proportion of their global ODA increases would go to Africa. It has therefore been assumed that each EU country would contribute 50% of its global ODA increase to Africa to meet the collective EU target.

The 2004 baseline averages multilateral disbursements over 2004 and 2005 to account for their ‘lumpiness’.

Through direct contributions to GAVI and through the IFFIm. GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions. http://www.gavialliance.org/funding/donor-contributions-pledges/.

The Global Fund. ‘Pledges and Contributions’ (spreadsheet). Converted into euros using the DAC annual exchange rate conversions. http://www.theglobalfund.org/documents/core/financial/Core_PledgesContributions_List_en/ (as of 8 May 2012).

Sweden. Ministry for Foreign Affairs. Strategy Document for Bilateral Cooperation. Swedish International Development Agency, 27 August 2007. http://www.sweden.gov.se/content/1/c6/08/66/21/496f32e6.pdf.

‘Project Evaluation Database.’ Swedish Agency for Development Evaluation (SADEV). http://www.sadev.scb.se/eng/database/sadev/sadev.asp

The 2012 projection has been taken from an April 2012 EC press release that gave ODA forecasts based on estimates provided by Member States. The difference in 2011 and 2012 ODA projection is due to ODA figures being in current prices and inclusive of debt relief while ONE monitors ODA increases exclusive of debt relief. However, in the absence of 2012 figures exclusive of debt relief, global ODA figures including debt relief have been taken.

Through direct contributions to GAVI and through the IFFIm. GAVI Alliance. ‘Annual donor contributions to GAVI 2000-2031 as of 31 January 2012’ (spreadsheet). Op. cit.

The Global Fund. ‘Pledges and Contributions’ (spreadsheet). Op. cit.

‘Bistndet ska ha tydliga ml’ (‘Aid must have clear goals’), Gunilla Carlsson, Swedish Minister for International Development Cooperation, Svenska Dagbladet, 20 March 2012

Ministry for Foreign Affairs/Sida. ‘Sweden’s aid – open and collected in one place’. http://openaid.se/en. Accessed 8 May 2012.

The United Kingdom's Progress: 2004–11

The UK pledged to reach an ODA/GNI target of 0.56% in 2010. It met this target, with global ODA levels disbursed in 2010 reaching 0.57% of total GNI. It met 101% of the global ODA levels promised for 2010. Its 2010 Africa ODA target was €4.35 billion, which it fell just short of meeting, with aid disbursements reaching €4.12 billion. It met 89.4% of the Africa ODA increase target (based on 50% of the increase to the global interim target)¹ promised over the 2004–10 period. Between 2004 and 2011, the UK increased its development assistance to Africa by 101.6% (€2.18 billion); development assistance to the sub-Saharan region, specifically, increased by 119.5% (€2.28 billion), while its global development assistance increased by 82.6% (€4.41 billion),² despite challenging economic circumstances.

In 2011, the UK produced a budgetary plan to be the first G8 country to reach 0.7% ODA/GNI. It also conducted the Bilateral and Multilateral Aid Reviews (BAR/MAR) to assess where best to focus development assistance. As a result, it is reducing the number of its bilateral aid recipients from 43 to 28 and has halted core funding to four multilateral organisations (UN-HABITAT, ILO,UNIDO and UNISDR).

The UK contributed €364.5 million (£298.7 million) to GAVI over the 2004–11 period.³ It also contributed €1.02 billion (£802.2 million) to the Global Fund over 2004–11.⁴ At the 2009 L'Aquila G8 Summit, it pledged to contribute €1.23 billion (£1.1 billion),⁵ over FY2009/10– FY2011/12 to the initiative. To date, the UK has disbursed €1.35 billion (£1.2 billion) which slightly exceeds its original pledge.⁶

Aid Effectiveness

The UK has been a consistent global leader in aid effectiveness. In 2011, the UK government set up the Independent Commission on Aid Impact to evaluate the effectiveness of different aspects of its aid. By April 2012, seven reports had been published, including reports on the effectiveness of DFID's engagement with the World Bank and on individual country programmes (e.g. Afghanistan and Zimbabwe). The UK was an active participant in the Fourth High Level Forum on Aid Effectiveness in Busan. In particular, it has championed aid transparency and has helped persuade other countries to sign up to the IATI standard, to which it already publishes. It is one of the best-performing EU donors assessed in the QuODA index, and ranks in the top ten of the 31 countries assessed in each of the four QuODA dimensions. All UK aid has been untied since 2002. In 2010, the UK channelled three-quarters of its development assistance through both procurement and public financial management country systems.

Looking Ahead: 2012–15

In its 2010 Comprehensive Spending Review, the UK projected that aid spending will reach 0.7% of GNI in 2013 and will maintain that level in the following years.⁷ This plan is supported by all three main political parties. The final delivery point is the March 2013 budget, when departmental spending figures will be confirmed for the financial year ahead. Therefore, the UK's global ODA target for 2013 is €12.6 billion, while the 2015 target is €13.11 billion in line with projected GNI growth. Between 2011 and 2015, global ODA levels should therefore rise by €3.35 billion to meet this target. The UK projected that it would keep levels at 0.56% in 2011 and 2012, thus it needs to increase ODA by €149.8 million for 2012 to take account of GNI growth. The UK's total Africa ODA target for 2015 is €6.03 billion. Between 2011 and 2015, it needs to increase ODA levels to Africa by €1.7 billion; considering the 2012 0.56% global target, a €97.3 million increase is required in 2012. The 2010 Coalition Government's agreement also included a pledge to enshrine the 0.7% target in law. As of May 2012, however, this legislation had not been introduced.

The UK hosted the GAVI pledging conference in 2011 and its summit leadership helped ensure that other donors made generous contributions, exceeding GAVI's fundraising target. Between 2012 and 2015, it has pledged €1.47 billion (£1.28 billion) to GAVI.⁸ At the Global Fund's Third Replenishment meeting, the UK indicated that it would likely contribute is €442.7 million (£384 million) from 2011–2013, subject to satisfactory MAR results.⁹ The MAR found the Global Fund had 'an excellent track record' and therefore the previous commitments are on track, with the possibility of an increased commitment from 2012.¹⁰ ¹¹ Thus far for 2012, the UK has a confirmed pledge of €142.5 million (£123.6 million).¹² At the 2012 G8 summit, it made a commitment of is €86.5 million (£75 million) to GAFSP for 2012–14.

Internationally, the UK should take the lead in increasing EU development spending in poor countries as it negotiates the next Multi-Annual Financial Framework. In 2011, 16.7% of UK aid was allocated via EU institutions, equivalent to €1.63 billion.

United Kingdom's ODA to Africa and Path to 2015 Africa Target

Note: ONE has taken into account the 'lumpiness' of multilateral contributions by giving the two-year average of multilateral disbursements for 2004 and 2005.

United Kingdom Notes

The EU collectively committed to provide 50% of global ODA increases to the African continent. Individual EU donors did not specify what proportion of their global ODA increases would go to Africa. It has therefore been assumed that each EU country would contribute 50% of its global ODA increase to Africa to meet the EU target.

The 2004 baseline averages multilateral disbursements over 2004 and 2005 to account for their ‘lumpiness’.

These were direct contributions to GAVI as well as contributions through the Matching Fund, AMC and IFFIm. GAVI Alliance. ‘Annual donor contributions to GAVI 2000–2031 as of 31 January 2012’ (spreadsheet). Converted into pounds sterling using the DAC annual exchange rate conversions. http://www.gavialliance.org/funding/donor-contributions-pledges/.

‘Pledges and Contributions’ (spreadsheet). The Global Fund. Converted into pounds sterling using the DAC annual exchange rate conversions. http://www.theglobalfund.org/documents/core/financial/Core_PledgesContributions_List_en/ (as of 8 May 2012).

Using 2009 exchange rates sourced from the OECD DAC.

‘Camp David Accountability Report’, p.23. (http://www.state.gov/documents/ organization/189889.pdf). The G8 accountability report uses the 2009 annual average exchange rate to convert from £ to USD (0.6402).

Spending Review 2010, October 2010. http://cdn.hm-treasury.gov.uk/sr2010_completereport.pdf.

Apart from direct funding to GAVI this includes pledges to the Matching Fund, IFFIm and the AMC mechanism. Taken from ‘Annual donor contributions’ (spreadsheet), GAVI, op. cit. Converted into pounds using the DAC 2011 exchange rate conversions.

The Global Fund, Global Fund Third Voluntary Replenishment 2011–2013. http://www.theglobalfund.org/en/donors/replenishments/thirdreplenishment2ndmeeting/documents/.

The Global Fund. ‘UK Minister Says Global Fund Has “Excellent Track Record” And Will Receive Increased Funding’. 1 March 2011. http://www.theglobalfund.org/en/mediacenter/pressreleases/2011-03-01_UK_Minister_says_Global_Fund_has_excellent_track_record_and_will_receive_increased_funding/.

The Global Fund still reports that the pledge amount for 2011–13 of £384 million is currently included in the column ‘Later or Pledge Period to be Confirmed’ and is subject to the UK Multilateral Aid Review.

Pledges and Contributions’ (spreadsheet). The Global Fund. Op. cit.

Reference Tables

Note: larger print versions of the tables are available in the pdf version of the report.

Global ODA Net of Bilateral Debt Relief (€ Millions, 2011 Constant Prices)

2004–11 increases are based on absolute ODA values. These differ from those presented elsewhere in this report, which measure progress from a smoothed baseline.

Global ODA

Taken from EC press release on 4 April 2011. Figures are inclusive of debt relief; for most EU12 member states debt relief figures are negligible, apart from the Czech Republic.

ODA figures for non-DAC member states are in current prices because there is no standardised deflator which allows current prices to be changed into constant prices. Data are inclusive of debt relief, as in most cases this is comparatively low and cannot be disaggregated from official aid figures.

Data for Brazil, China, India, Russia, Saudi Arabia, South Africa and Turkey have been sourced directly from the DAC.

UNDESA (2010) 'Development Cooperation for the MDGs'. 5 EDC 2020 (2011) 'Mexico as an Emerging Donor'.

Global ODA as a % of GNI (Net of Bilateral Debt Relief)

Proportion of 2015 global ODA target so far met in 2011.

Global ODA as a % OF GNI

Proportion of 2015 global ODA target so far met in 2011.

80 Per Capita Global ODA Net of Bilateral Debt Relief (€, 2011 Constant Prices)

Share of Aid: Bilateral/Multilateral GLOBAL

ODA to Africa Net of Bilateral Debt Relief (€ Millions, 2011 Constant Prices)

2004–11 increases are based on absolute ODA values. These differ from those presented elsewhere in this report, which measure progress from a smoothed baseline.

Per Capita ODA to Africa Net of Bilateral Debt Relief (€, 2011 Constant Prices)

ODA to Sub-Saharan Africa Net of Bilateral Debt Relief (€ Millions, 2011 Constant Prices)

2004–11 increases are based on absolute ODA values. These differ from those presented elsewhere in this report, which measure progress from a smoothed baseline.

Per Capita ODA to Sub-Saharan Africa Net of Bilateral Debt Relief (€, 2011 Constant Prices)

Methodology

Measuring Progress on Development Assistance

What are the Main Sources of Data?

OECD Development Assistance Committee (DAC) Online Database: www.oecd.org/dac

Table 1 for all disbursements of official development assistance (ODA) from 1960 to 2011.

Table 2a for disbursements by recipient country and region.

Table 5 for all commitments by sectors.

Table 7b for tying status of ODA.

CRS Database

Table 1 for all commitments and all details, 1973–2010.

The DAC releases preliminary ODA figures each April for the previous calendar year. These figures can be found at: http://www.oecd.org/dataoecd/42/61/50066140.xlsx

These preliminary data provide only a basic breakdown (by region, but not by sector) and are subject to revision.

The DAC then releases final data in December for the previous year; these include a full breakdown of the ODA figures by sector. The preliminary data for 2010, used in the 2011 DATA Report, were revised for some countries in the final December 2011 release. These revised and final 2010 figures have now been used for the purpose of this report.

Quality of Official Development Assistance Database

The Quality of Official Development Assistance (QuODA) is an assessment of 31 donor countries and organisations across 31 indicators of aid quality, grouped into four dimensions. It is provided by the Brookings Institution and the Center for Global Development. http://www.cgdev.org/section/topics/aid_effectiveness/quoda

What is the DAC and Why Does ONE Use its Data?

The DAC is the Development Assistance Committee of the OECD. Its 24 current members are: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Japan, Korea, Luxembourg, the Netherlands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland, the UK, the US and the European Commission.

The DAC, set up in 1960, has set an internationally agreed upon standard definition for what can and cannot be counted as ODA. ODA is made up of grants or concessional loans given by the official sector to a defined list of developing countries. The promotion of economic development and welfare must be the main objective of the loan or grant. If a loan is given, the grant element must be at least 25% (this measures the concessionality of the loan based on its interest rate, maturity and grace period; a grant would be 100%). Loans or grants for military purposes cannot count as ODA.

Reporting to the DAC is mandatory for all DAC members. What can be reported as ODA is governed by strict rules, with which all members of the DAC must comply. This means that there are objective, internationally comparable figures for ODA going back to 1960, which are produced and validated by the OECD DAC each year. These provide an accepted benchmark for measuring performance.

What is the Difference Between Bilateral and Multilateral Development Assistance and How Does ONE Measure Them?

DAC data on donor countries' ODA measure the outflow of resources and divide it into two categories: bilateral and multilateral. The DATA Report provides credit to donors for all contributions made to Africa, sub-Saharan Africa and least developed countries (LDCs), including their contributions to multilateral organisations.

Multilateral ODA is comprised of the contributions provided to multilateral organisations that are not earmarked and can be used anywhere (with the exception of some regional banks). By definition, therefore, the multilateral contributions from each donor are not disaggregated by country or region.

The DAC reports how much donors have contributed to each multilateral agency. It also reports how much has been spent by each multilateral agency, by country and sector. Therefore, it estimates what proportion of each DAC country member's contribution to multilateral agencies can be imputed for Africa and sub-Saharan Africa. However, the April 2012 preliminary release for 2011 ODA figures reported only donor contributions to agencies, not multilateral disbursements to countries and regions. For the purpose of this report, ONE has estimated what proportion of this would go to Africa, sub-Saharan Africa and LDCs. ONE calculates this by applying the proportion that multilateral agencies provided to Africa, sub-Saharan Africa and LDCs in 2010 to what each DAC donor gave in global multilateral aid in 2011 (as reported in the preliminary April 2012 release). For example:

In 2010, UN agencies contributed 32.6% of their total ODA to sub-Saharan Africa.

In 2011, Germany contributed €243.1 million to UN agencies in total.

Therefore, Germany contributed €79.3 million (32.6% of €243.1 million) to sub-Saharan Africa via its contributions
to UN agencies in 2010.

ONE recognises that this is only an estimation, and will apply the full DAC multilateral imputation figures when they are released in December 2012.

Donor contributions to multilateral agencies often span a three-year period. This means that the ODA received by a multilateral agency may be quite high one year and low in another. For the purposes of establishing a baseline upon which to measure commitments to increase ODA, ONE has averaged 2004 and 2005 multilateral ODA to Africa and added that to the donor's bilateral ODA to Africa in 2004. This total is used as the 2004 baseline year. This averaging avoids the 'lumpiness' of a replenishment year which could establish an artificially high baseline figure. When examining increases from the baseline year (2004) for the commitments of the EU15, ONE uses this average multilateral baseline to calculate increases.

Bilateral ODA encompasses all other activities that are eligible to be counted as ODA, including earmarked funding that is channelled through multilateral organisations. Donors report the overall volume and percentage of bilateral ODA disbursements by region to the DAC, such as Africa, sub-Saharan Africa and LDCs, each year.

Why are There Sometimes Differences Between a Country's Own Data and the DAC Data?

There are a number of possible reasons for this. For example, a country's own data may follow a different financial year or a country may include programmatic or assistance categories that deviate from established DAC definitions and guidelines. Another possible reason is that multiple ministries may be responsible for managing development assistance activities. While the totality of each country's aid programme should be collectively reported to the DAC, domestic reporting may cover only the activities of the main development assistance ministry. In addition, government reporting is often based on budgets; DAC reporting deals with annual disbursements. Finally, a number of countries use multiple coding, where an activity will be coded for several sectors (for instance 20% to water, 50% to health, 30% to infrastructure), but DAC coding allows for only one sector per project.

How is Debt Relief Counted as ODA?

Multilateral debt cancellation is included in this report for ODA through multilateral contributions. This is because donors finance, or offset, the costs of multilateral debt cancellation through additional contributions. Therefore the cost to a donor of cancelling multilateral debt is paid through its contributions to the multilateral agency (e.g. IDA or the African Development Bank). For bilateral debt, under current rules, once debt has been cancelled donors can report the whole face value of the debt as ODA. This means that the principal, interest and arrears penalties corresponding to the full life of the loan are counted in the ODA figures at the point of cancellation, and are included in the DAC reports. This amount does not reflect either the value to the developing country or the cost to the donor country of cancelling the debt. For example, the US or France is able to cancel a loan to a poor country at a markedly discounted rate – typically 10–15% of the original face value – and yet receive credit at the DAC for the full face value. The recipient country will see only a small fraction of the cancellation as a new financial flow from which it can fight poverty.

Why has ONE Decided to Exclude Bilateral Debt Relief From the Measures of Progress on Development Assistance?

ONE has excluded all bilateral debt relief from its measures of progress when assessing whether countries' reported ODA flows represent new, increased resource flows. Debt relief is immensely valuable and, as a result of it, governments are now able to spend resources on health, education and critical infrastructure instead of unsustainable debt service payments.

However, as noted above, the rules on counting bilateral debt cancellation as development assistance overstate the value of the debt relief – in particular, when compared with the budgetary outlays or domestic accounting treatment required to execute the debt clearance operation. Exactly how much should be counted is unclear, due to lack of transparency by donors in terms of disclosing their internal accounting or budget pricing (e.g. mark-to-market valuations).

In addition, it is unlikely that any African countries will be significantly benefiting from bilateral debt cancellation by 2015. Therefore, EU15 donors need to make budgetary provisions to achieve the 2015 target without relying on ODA inflated by bilateral debt cancellation figures.

ONE remains hopeful that a more accurate means of accounting for bilateral debt relief will become available in the future, so that donors can be duly credited for the true allocations they make for bilateral debt cancellation in their annual budgets. In the interest of transparency, ONE also includes footnotes throughout the report that state the impact of including bilateral debt cancellation for each EU15 donor.

For the preliminary 2011 ODA figures published in April, the DAC has not specified the levels of debt relief that individual DAC donors provide to Africa or to LDCs. However, it does provide debt relief figures for sub-Saharan Africa. African bilateral debt relief figures for 2011 are assumed to be equal to bilateral debt relief figures for sub-Saharan Africa in the absence of this information in the preliminary release (e.g. It has been assumed that North Africa did not receive any bilateral debt relief in 2011). The same methodological challenge exists for bilateral debt relief provided to LDCs. In the absence of this information, the share of LDC bilateral debt relief per donor has been calculated by applying the same proportion of global bilateral debt relief as a proportion of global bilateral ODA to bilateral ODA disbursed to LDCs in 2011. For example:

In 2011, France's global bilateral ODA was €6.11 billion, including €865.99 million in debt relief
(14.2% of global bilateral ODA).

In 2011, France's total bilateral ODA (including debt) to LDCs was €1.34 billion. Applying the same proportion of global bilateral debt relief as a percentage of global bilateral ODA to bilateral ODA to LDCS, France's debt relief to LDCs would
total an estimated €190.39 million.

Therefore, France's bilateral ODA excluding debt to LDCs was €1.15 billion (€1.34 billion minus €190.39 million) in 2011.

Why Does ONE Use Constant 2011 Prices?

Using constant prices ensures that ODA commitment values are not eroded by inflation or national currency devaluations over time. Inflation reduces the value of the euro commitments made in 2002. As a result, the same amount of money in nominal terms will provide less development finance on the ground and will not be enough to pay for the sector outcomes to which the EU15 donors committed themselves. In order to show progress in real terms, ONE applies the respective DAC deflators for both commitments and resource flows to convert all ODA figures into 2011 prices.

How has the Leveraging Effect of the EU's New Multi-Annual Financial Framework Been Calculated?

This year's DATA Report attempts to show the leveraging effect that the proposed Multi-Annual Financial Framework (MFF) and the 11th European Development Fund (EDF) could have on ODA flows for EU Member States. ONE defines 'leveraging effect' as the additional ODA/GNI percentage that could be achieved through each Member State's budgetary contribution to the next MFF and EDF (which run from 2014–2020). In order to calculate this, ONE considers donors' past contributions, and future commitments, to the European Commission (EC) and the European Development Fund (EDF). EU documentation is used to calculate future Member State contributions to the EDF by considering: (a) 2011 actual contributions; (b) annual commitments for the 2012–13 period; and (c) annual commitments for 2014–15 for the 11th EDF.² ONE's leveraging effect methodology also takes into account changes in contributions to the EC. Data on EU27 Member States' disbursements through 2010 are sourced from the OECD DAC. The preliminary data released in 2011 do not provide information on what each EU Member State contributed to the EC. However, they do provide information on what each EU Member State disbursed to EU institutions (e.g. the EC and EDF). EC contributions for 2011 are calculated by subtracting EDF contributions from the total EU institution aid contribution figures. For example:

In 2011, Belgium disbursed €388.3 million to EU institutions.

In 2011, Belgium contributed €132.8 million to the EDF.

Across 2008–10, on average, Belgium's contributions to the EDF and EC made up 96% of its total ODA to EU institutions.

Therefore, in 2011 Belgium contributed €239.8 million (96% of €388.3 million minus the €132.8 million contribution to the EDF) to the EC.

To estimate 2012–2013 ODA contributions to the EC under the current MFF, shares based on the most recent EU Budget Financial Report have been applied to the 2012 and 2013 Heading 4 budgets.³ The same shares have been applied to the Heading 4⁴ commitment appropriations for 2014 and 2015 under the new MFF in order to estimate ODA to the EC from each member state.

How Does ONE Calculate Targets and Measure Past Progress?

This report measures progress in ODA levels between 2004 and 2011. While the EU15 have set 2010 and 2015 development objective targets, they have not set annual interim targets. This report assumes a straight-line trajectory showing the path that donors would need to maintain in order to achieve regular annual steps towards the 2015 target. To calculate the increases needed for 2015, the trajectory has been calculated using the 2011 preliminary figures as a baseline and assuming equal annual year increases to reach the donor's respective 2015 target.

How are the Development Assistance Targets Calculated for Global ODA, Africa and LDCs?

Unless otherwise stated, all DAC figures in Figure 2 are denominated in 2011 prices using DAC deflators. This is consistent with the DAC methodology, which reports projected 2015 ODA figures in constant prices. To convert between US dollars and euros, ONE uses the DAC annualised exchange rates. Annual ODA to Africa includes both bilateral contributions and the share of each donor's estimated multilateral contributions for Africa. To establish the baseline figures, ONE averages multilateral contributions in 2004 and 2005.⁵ As noted previously, ONE monitors progress towards the 2010 interim targets net of bilateral debt relief.

Annual ODA to LDCs includes both bilateral contributions and the estimated share of each donor's global multilateral contributions to LDCs. Multilateral contributions to LDCs are calculated in the same manner as ODA disbursements to Africa and sub-Saharan Africa. The LDC target is established for 2010 and ONE monitors whether the target has been achieved, including any subsequent volume changes in ODA disbursement in 2011. Again, ONE monitors progress net of bilateral debt relief.

What Information has ONE Used to Assess ODA Effectiveness?

The aid effectiveness chapter uses aggregate aid quality rankings devised for the Quality of Official Development Assistance (QuODA) index, published by the Center for Global Development and the Brookings Institution. QuODA utilises 31 indicators to assess aid quality across four dimensions:

Maximising Efficiency (eight indicators);

Fostering Institutions (eight indicators);

Reducing Burden (seven indicators) and

Transparency and Learning (eight indicators).

The first QuODA report was released in 2010. The second edition was released in March 2011, ahead of the Fourth High Level Forum on Aid Effectiveness in Busan, South Korea. This second edition measures donors' performance during the 2009–10 period. Most indicators draw upon OECD DAC data from 2009–10. However, indicators based on the Paris Monitoring Survey use 2010 data. Additional indicator data are drawn from various other sources, including the IMF World Economic Outlook, AidData, IATI, the World Values Survey, agency websites and the Afro-, Asian, Euro- and Latino-barometers.

To enable comparison amongst donors, QuODA converts the raw data into z-scores. These z-scores provide aggregated indicator averages for each dimension. The z-score illustrates how many standard deviations away an individual donor's performance is compared with the sample mean. This report supplements QuODA's aggregated dimensions with eight additional individual aid quality indicators, described in Figure 3.

The EU27 committed to reach a 0.56% ODA/GNI collective target by 2010.⁶

The EU27 have committed to reaching a 0.7% ODA/GNI collective target by 2015.⁷

Methodology Notes

http://ec.europa.eu/budget/library/biblio/documents/2010/rep_budg_fin_manag_2010_en.pdf.

Calculations have taken into account the fact that contributions are usually lower than average in the first year and higher in the last year.

Heading 4 (‘Global Europe’) is the section of the MFF covering all external action (‘foreign policy’), but it does not include the European Development Fund. This calculation has assumed that 90% of Heading 4 is ODA-eligible.

Ibid.

Since multilateral contributions are often disbursed in lump sums, ONE smoothes these two years for the purposes of establishing a baseline for progress.

This is higher than if one were to add each of the EU27 member states’ individual global ODA targets for 2010. When adding each of the individual EU27 2010 global ODA  targets, the figure is 0.54%.

This is higher than if one were to add each of the EU27 member states’ individual global ODA targets for 2015. When adding each of the individual EU27 2015 global ODA  targets, the figure is 0.69%.

 Acronyms

AU African Union
AMC Advanced Market Commitment
BAR Bilateral Aid Review
DAC Development Assistance Committee
CPA Country Programmable Aid
CRS Creditor Reporting System
DCI Development Cooperation Instrument
DFID Department for International Development
EC European Commission
EDF European Development Fund
ENPI European Neighbourhood Policy Instrument
EU European Union
EU27 The 27 current Member States of the European Union
EU15 The 15 Member States which joined the Union prior to 2004
EU12 The 12 Member States which acceded to the Union after 2004
FDI Foreign Direct Investment
FTI Fast Track Initiative
FTT Financial Transaction Tax
GAFSP Global Agriculture and Food Security Program
GAVI Global Alliance for Vaccines and Immunisation
GFATM Global Fund to Fight AIDS, Tuberculosis and Malaria
GNI Gross National Income
HIPC Heavily Indebted Poor Countries
IATI International Aid Transparency Initiative
IDA International Development Association
IFFIm International Financing Facility for Immunisation
IMF International Monetary Fund
LDCs Least Developed Countries
MAR Multilateral Aid Review
MDGs Millennium Development Goals
MFF Multi-Annual Financial Framework
NGO Non-Governmental Organisation
ODA Official Development Assistance
OECD Organisation for Economic Co-operation and Development
PFM Public Financial Management
QuODA Quality of Official Development Assistance
Sida Swedish International Development Agency
SSA Sub-Saharan Africa
UN United Nations
UNECA United Nations Economic Commission for Africa
WFP World Food Programme