It is a pleasure to participate in this important paneldiscussion on aid effectiveness. This issue featured prominently in therecent review session on chapter IV of the Monterrey Consensus– on “Increasing International Financial andTechnical Cooperation for Development”. Building on thatsession, this panel discussion is well positioned to contribute to thefirst ECOSOC Development Cooperation Forum, to be held on 30 June and 1July in New York, and the third High Level Forum on Aid Effectiveness,to be held in Accra in September.
Official development assistance remains crucial for financingthe internationally agreed development goals, including the MillenniumDevelopment Goals. While the trend of decreasing ODA was reversed inthe years following the Monterrey Conference, it is a matter of concernthat declines in ODA levels were registered in 2006 and 2007. Therecontinues to be an urgent need to increase the levels of developmentassistance over the coming years.
At the same time, strengthening the effectiveness of aidrequires us to modify the aid architecture. The current structure is aloose aggregation of many multilateral and bilateral agencies andfunds, including a growing number of new donors. Despite signs ofimprovement in donor coordination, recipient countries, nevertheless,have to deal with a variety of aid instruments and associatedagreements with a large number of entities.
The Monterrey Consensus was a turning point in establishing aconcerted agenda for enhancing aid effectiveness. It underscored thatcoherence is needed at both national and international levels,including among ministries of finance, development ministries andexport credit agencies of bilateral donors. It recognized theimportance of harmonizing operational procedures, so as to reducetransaction costs. It supported initiatives, such as untying of aid. Itcalled for enhancing the absorptive capacity and financial managementof recipient countries. And it reaffirmed that each country needs todetermine its own priorities and development policies – as anessential requirement for aid to be effective.
OECD-DAC Rome and the Paris High Level Forums sought to deepenthis agenda by setting forth a number of key principles and monitorableindicators to improve aid effectiveness. The 2005 Paris Declaration onAid Effectiveness was an important milestone in setting out theprinciples of strengthening ownership, alignment, harmonization,results management and accountability.
As we prepare for the Accra High Level Forum on AidEffectiveness, a number of difficulties and weaknesses have becomeapparent in the way we have addressed the aid effectiveness agenda thusfar.
One lesson we are learning, in my view, is that aideffectiveness cannot be separated from the discussion on developmenteffectiveness. Focusing primarily on procedural changes may limit theattention given to development. At the same time, it is becomingapparent that it is difficult to assess, precisely, the results of theParis Declaration – and the extent to which it has changedthe behaviour of donors for the benefit of the poor in developingcountries.
Yet another lesson is that the framework for aid effectivenesswill need to become more inclusive if genuine ownership of allstakeholders is to be achieved. In particular, it ought to give morespace to issues of concern to developing countries, such aspredictability, conditionality, concessionality and the untying of aid.This came out clearly in the high-level symposiums that we organized inpreparation for ECOSOC’s Development Cooperation Forum.
The United Nations is uniquely suited to make this happen. Itsnew Development Cooperation Forum is well placed to promote aninclusive discussion among all the relevant development actors on whatthey expect from a strengthened framework for aid effectiveness. Such adiscussion could provide an important input into the negotiations ofthe Accra Agenda for Action – and beyond, into the ReviewConference on Financing for Development, to be held at Doha later thisyear.
I hope that Accra will also be about building partnerships– partnerships aimed to help developing countries build theircapacities to measure and monitor aid effectiveness, and to absorb andmanage additional aid flows. Accra should also be about aligning aidwith long-term development strategies, to achieve self-sustaininggrowth and employment.
On all of these issues, the outcomes of the Accra High LevelForum should feed into the discussions at the Doha Review Conference.The Doha Conference presents an excellent opportunity to consolidateand build on the progress made in advancing aid effectiveness, both atthe Development Cooperation Forum in New York and in Accra.
I am confident that all these related events this year will beideal venues for addressing the challenges of improving aideffectiveness and implementation of aid commitments – and formobilizing renewed political will around the great global partnershipfor development that we launched in Monterrey in 2002 and strengthenedat subsequent United Nations summits.
Thank you.