The DAC Official Development Assistance ODA Kimberly

The DAC & Official Development Assistance (ODA) Kimberly Smith, Administrator Development Cooperation Directorate OECD 28 May 2008 Moscow, Russia

What is the DAC? • • 22 Bilateral Donors, plus European Commission (EC). • Objective: improve development assistance through coordination and collaboration with major stakeholders. • 2 Development Assistance Committee (DAC) of the OECD. Collect and synthesize data on aid and foreign assistance and deliver the data to the public.

DAC Statistics • • 3 Measure resources for development (not just aid) including; üOfficial Development Assistance (ODA) üOther Official Flows (OOF) üPrivate Flows (NGOs) üNet Private Grants DAC statistics are the only reliable source of both total and comparative data on aid performance

DAC Reporters • • Limited data on aid only (ODA) from non-DAC members. • 4 Data is collected data from: üAll DAC Member Countries üNon DAC Donors (voluntary) üMultilateral Agencies (voluntary) In the future, we hope to improve reporting from non. DACs, multilaterals and foundations.

Current DAC Members Australia Luxembourg Sweden Austria Germany Netherlands Switzerland Belgium Greece New Zealand United Kingdom Canada Ireland Norway United States Denmark Italy Portugal European Commission (Multilateral) Finland 5 France Japan Spain

Collection Methods – DAC Members • • Both systems based on instructions agreed by members detailed in Statistical Reporting Directives • 6 DAC questionnaire – aggregate level data Creditor Reporting System (CRS) – activity level reports CRS++ Method Reports supplied by members and other reporters

DAC Questionnaire The full DAC Questionnaire consists of the following 7 Tables: • • 7 1 – Disbursements and Commitments of Official and Private Flows 2 a – Destination of Official Development Assistance – Disbursements 2 b – Destination of Other Official Flows – Disbursements 3 a – Destination of Official Development Assistance – Commitments 4 – Destination of Private Direct Investment and Other Private Capital 5 - Official Bilateral Commitments (or Gross Disb. ) by Sector of Destination 7 b – Tying Status of Bilateral Official Development Assistance – Commitments

Creditor Reporting System CRS Form 1 reports on annual obligations, while CRS Form 2 reports on gross disbursements. Over 30+ variables per form including; • Recipient Countries (possibility of grouping by continent or by income group) • Donors (grouped into bilateral and multilateral) • Sectors and Sub-Sectors Codes • Activity/Project Titles and Descriptions • Flows: Grants, Loans, ODA, OOF • Channels of Delivery • Policy Markers (gender equality, environment, PD/GG) • RIO Markers (biodiversity, climate change, desertification) 8

Data Collection Timeline • • 9 Advanced Questionnaire (AQ) üData solicitation – Jan/Feb each Year üReporting Deadline – March 15 th üDAC Press Release - April (preliminary figures) Full DAC Questionnaire üData solicitation – Jan/Feb each Year üReporting Deadline – July 15 th üDAC Press Release - December

Statistics on Non DAC Members • • Records disbursements (and commitments) of aid by recipient. • Limited presentation of data in DCR; but supplemented by textual information: draft supplied by donor. • 10 Abbreviated reporting form. Reporting is voluntary. Current reporters include all non-DAC OECD members except Mexico, Arab donors, Israel, Thailand Baltic states.

Current Non-DAC Reporters Arab Donors Israel Slovak Republic Czech Republic Korea, South Slovenia Estonia Mexico* Thailand Hungary Latvia Taiwan Iceland Lithuania Turkey Poland Bolded countries are the non-DAC OECD Members * Only textual information reported, no data 11

Collection Method – Non DAC Members Abbreviated DAC Table 1 TABLE DAC N 1 - Abridged version DAC QUESTIONNAIRE ON AID FLOWS FROM NON-DAC DONORS DISBURSEMENTS OF FLOWS TO ODA RECIPIENTS ON THE DAC LIST 2006 edition Reporting country: ? ? ? Period: 2007 Exchange rate used: ? ? ? 112 Million US Dollars Gross 12 Total ODA Bilateral ODA Multilateral ODA GNI ODA%GNI 010 015 180 001 002 ///////////// 113 Disbursements Amounts Received (-) ///////////// 114 Net Date: ? ? ?

Collection Method – Non DAC Cont. Abbreviated DAC Table 2 a/3 a TABLE DAC N 2 a/3 a DAC QUESTIONNAIRE ON AID FLOWS FROM NON-DAC DONORS Reporting country: ? ? ? DESTINATION OF GRANTS AND CONCESSIONAL LOANS - COMMITMENTS AND DISBURSEMENTS 2007 edition Period: 2007 Exchange rate used: ? ? ? Date: ? ? ? MILLION US DOLLARS 13 RECIPIENT I. EUROPE, TOTAL ALBANIA BELARUS BOSNIA-HERZEGOVINA CROATIA MACEDONIA (FYROM) MOLDOVA MONTENEGRO SERBIA TURKEY UKRAINE STATES OF EX-YUGOSLAVIA UNSPECIF. EUROPE, REGIONAL 071 086 064 062 066 093 065 063 055 085 201 204 205 D I S B U R S E M E N T S NEW COMMITMENTS GRANTS LOANS (TOTAL FOR GRANTS GROSS REPAYMENTS AND LOANS) DISBURSEMENTS OF PRINCIPAL ( - ) 0. 00 305 088 089 206 TOTAL NET DISBURSEMENTS 0. 00 0. 00

Statistical Outputs • Annual Development Co-operation Report (DCR) • Geographical Distribution of Financial Flows • Statistical analysis in Peer Reviews of DAC member’s aid programme International Development Statistics Online • • 14 CD-ROM and on-line access External uses, including World Bank publications, Millennium Development Goals and other UN documents, databases and publications

What is ODA? • The official measure of foreign aid. • Only internationally comparable measure of donor assistance. • Reported by donor countries to the OECD/DAC on an annual basis. 15

ODA Targets & Performance • • The average ODA/GNI ratio for DAC countries was only 0. 31% in 2006. • Only five countries achieve the 0. 7% target, but several others have plans to do so. • 16 1970 UN Resolution urged advanced countries to provide 0. 7% of their national income as ODA. The EU has set ambitious ODA targets of GNI of 0. 17% of GNI by 2010 and 0. 33% by 2015 for the 12 new members.

Explanation of ODA are official flows to or for developing countries that are provided: • for developmental purposes • • as grants or • 17 by the official sector (Government, public funds) as “soft loans” (ODA loans are at terms significantly softer than commercial transactions, and bear a “grant element” of at least 25% compared with a loan at 10%. )

Official Definition of ODA “Those flows to countries and territories on DAC List of ODA Recipients and to multilateral institutions which are; I. Provided by official agencies, including state and local government, or by their executives agencies; and II. Each transaction of which; a) Is administered with the promotion of the economic development and welfare of developing countries as its main objective; and b) is concessional in character and conveys a grant element of at least 25 per cent (calculated at a rate of 10 per cent). ” 18

ODA Eligible Countries • • Includes all low and middle income countries • Exceptions: G 8 members, EU Members and countries with a firm date of accession to the EU • Reviewed every three years by the DAC • 19 Specifically defined set of countries Countries may graduate from the list, or change income groups

ODA Eligible International Organizations Agencies to which core contributions are reported as ODA in whole or in part include: • Many United Nations & UN Administered Funds • European Commission • International Monetary Fund (concessional windows only) • World Bank (IDA) • World Trade Organization (technical assistance activities) • Regional Development Banks • Other Multilaterals 20

Definition of ODA Flows • • Commitment: Firm undertaking to provide specified funds Disbursement: Actual payment or expenditure of funds • • Grant: Non-repayable Loan: Initial Loan plus Repayments. Only report repayments of loan principal, not interest • • Performance assessed on net disbursements Net disbursements = disbursements of grants + disbursements of loans - repayments of loan principal 21

Important Notes • ODA is a measure of donors’ expenditures on aid. • It is NOT a measurement of the amount of value received by a recipient country. • ODA is a subset of foreign assistance. 22

Examples of ODA Activities • • 23 Development Projects – schools, clinics, water supply systems etc… Emergency Aid for Natural or Man-made Disasters Contributions to Multilateral Development Agencies Food Aid, Emergency and Developmental Aid to Refugees and IDPs Debt Relief outlined by Paris Club Agreement Officially Financed Scholarships for students in developing countries

Non Eligible ODA Activities • • 24 Military or Security Assistance Cultural programmes for the donor’s nationals resident in other countries Aid from NGOs financed from private sources Foreign Direct Investment Official export credits or other commercially motivated transactions Guarantees on private export credits or investments Reduced tariffs or other concessions on imports from developing countries

Importance of Data • • • 25 Domestic and Foreign Policy/Diplomacy Fosters Accountability Improves Transparency Provides a Platform for Dialogue üRecipient Countries üOther Donors Alignment with International Standard Drives Future Policy Decisions

Establishing a Database • Collection of facts, both financial and descriptive. • Living entity – flexible, updatable, everexpanding. • Requires a lot of up-front work. • ASSET. Tool for answering questions and 26 provides the basis for in-dept analysis, and future policy implications.

Data Collection • Who will collect the data? • What is the current mandate for data collection? ü Is this type of reporting mandated by law? ü Agreement between government and international organization? • How is the message of importance conveyed? 27

Further Information & Resources • General User Guide for DAC Statistics: www. oecd. org/dac/stats/dac/guide • • List of ODA-eligible International Organisations: http: //www. oecd. org/dataoecd/36/16/31724727. pdf • DAC List of ODA Recipients: www. oecd. org/dac/stats/daclist • DAC Statistical Database: www. oecd. org/dac/stats/idsonline • 28 Short Guide to ODA Eligibility: “Is it ODA”: www. oecd. org/dataoecd/21/21/34086975. pdf DAC Statistical Tables: www. oecd. org/dac/stats/dac/reftables

Contact Information Kimberly Smith Kimberly. Smith@oecd. org 29