While the developed world has not yet lived up to its commitment to give 1% of its GDP to the developing South, aid flows have increased since 2000, when the pledge was renewed at the United Nations Millennium Summit. A Southern Africa Trust policy brief, Aid Effectiveness: Trends and Impacts of Shifting Financial Flows to Civil Society Organisations in Southern Africa, which assesses aid effectiveness in civil society, confirmed the trend.
“In the Southern African Development Community region, in particular, aid volume to civil society is increasing substantially but is difficult to quantify due to the limited classification of aid by donors as it relates to the definition of civil society,” says the report.
Ensuring aid effectiveness in the region is vital because money is increasingly going to new aid recipients including Afghanistan and Iraq. In addition, flows to the region are likely to slow in 2007 and 2008. “Survey data from the Africa Partnership Forum indicates that the increase in aid allocations to Africa over the next two years will be very modest. Another disturbing feature of the new aid … is [that it is] really not new aid, but tied to cancellations of debt.”
While this poses a challenge to civil society dependent on aid, the report notes that new forms of revenue are making up the gap. Foreign direct investment is up substantially, while remittances from migrants are of growing importance to national balance sheets. In addition, South-South trade and investment is growing too. “… financial inflows from countries such as China, India and Brazil are becoming significant and growing rapidly”, says the report.
In addition, the report points to what it calls a new architecture of aid patterns. Increasingly, donors are pooling support into national and regional intermediaries; multiple funding agencies are more common, as are new support models; funds are going directly to civil society where governance is weak and international NGOs are increasingly a conduit for northern governments’ aid efforts.
The focus on aid effectiveness is part of civil society’s effort to ensure that it has a booming voice in policy formulation across Southern Africa.
The authors found that business organisations have a greater voice in policy formulation than civil society.
The Trust’s study covered seven countries and sought to identify the obstacles on the path to provision of effective aid. It found that:
- access to aid flows is a key challenge for most of civil society because of an increasing concentration of resources in fewer recipients;
- harmonised aid required better operating systems. “More aid does not necessarily translate into more effective aid if operating systems and capacity constraints are not addressed”;
- too much harmonisation can affect the diversity in civil society; and
- civil society should cease to be seen as a last resort for aid disbursement where governments have failed – instead it must be seen as a key player in the development process.
Giving for good
In a time of growing aid dis-bursements, a recent Southern Africa Trust study in seven countries made the following recommendations:
Civil society needs support to give voice to citizens in order to bolster poverty reduction policies;
- Traditional systems of giving must give way to multi-donor support, joint initiatives and the identification of local organisations capable of effectively managing improved aid flows; and
- Further studies are required to understand what happens when NGOs become service providers; and to understand whether linkage programmes between government and civil society are working.
Is it working?
Jean Didier-Oth of the Canadian International Development Agency says the Paris Declaration’s five principles on aid effectiveness should guide any assessment. They are:
- Ownership: aid is demand driven and partners negotiate where and how it is allocated and managed by locals.
- Alignment: aid is aligned to existing development strategies in the partner countries
- Harmonisation: donors coordinate their work and avoid duplicating programmes and wasting partner’s scarce administrative resources.
- Mutual accountability: donor and partners will respect their engagement and share the responsibilities of aid management.
- Results management: impact and goal oriented, use of monitoring and evaluation, baseline studies, clear progress indicators.
For the full report and policy brief visit http://www.southernafrica trust.org/Research_report.html