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TitleThe international aid system 2005-2010 : forces for and against change
Publication TypeMiscellaneous
Year of Publication2004
AuthorsRogerson, A
EditionDraft
Pagination37 p.
Date Published2004-01-01
PublisherOverseas Development Institute (ODI)
Place PublishedLondon, UK
Keywordsdevelopment cooperation, evaluation, funding agencies, institutional aspects, policies, triple s harmonisation
Abstract

With the question what is driving current governmental and intergovernmental aid in mind the report summarises the main elements of the stylised 2003 consensus model of aid effectiveness (the Monterrey Aid Compact, the Millennium Development Goals, the Poverty Reduction Strategy process, streamlined conditionality, and performance-based aid allocations). It then examines in this context four main elements of unfinished business: aid volume and absorption; new tied aid; selectivity and balance; and grants versus loans, highlighting implications for the aid system in each area. It then reviews from a systemic perspective three recent institutional innovations enacted or proposed: the US Millennium Challenge Account, the GFATM and the International Financing Facility. If these are to succeed, existing aid institutions will have to accept much more change on their own part than they appear ready to accommodate today. Finally, we will sketch four of the many possible future scenarios for the aid system. The first two see with the current focus on aid as a catalyst for pro-poor growth reinforced, both in the context of more competition among actors in the system, and in the context where there is, conversely, less competition. The other two look at scenarios where the emphasis on poverty becomes much weaker, again in different contexts of competition among actors in the system. The Appendix looks at how the different scenarios could affect the changing roles of the major multilateral agencies. The next phase of this work will build and discuss scenarios for the system as a whole beyond 2010, outlining implications in each scenario for the major categories of institutions, including UN agencies, multilateral banks, the EC and prominent bilaterals.

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