7 Actors and arenas
The composition and organisation of the various aid and development actors, which is often referred to as aid architecture, is undergoing rapid development and change. Previously, it largely consisted of various UN organisations, the World Bank and the regional development banks, and bilateral donors from the OECD countries, in addition to a wide range of national and international NGOs.
Textbox 7.1 Arab aid
Arab aid has made an important contribution to international development efforts since the early 1970s. During periods with high oil prices, the aid from these countries has been extensive.
Arab donors are not part of the Organisation for Economic Co-operation and Development (OECD) and are therefore not obliged to keep statistics for their aid contributions. However, official statistics from Saudi Arabia, Kuwait and the United Arab Emirates show that the largest contributions are given in connection with bilateral cooperation, largely in the form of development loans. Studies show that substantial unreported funds are also channelled via the authorities and prominent private individuals, such as members of the Saudi royal family. Around 80 per cent of official Arab aid comes from Saudi Arabia, which had an aid budget of USD 2.1 billion in 2007.
Arab aid primarily goes to countries that are members of the Organisation of the Islamic Conference. In addition to other Arab countries, the main recipients include Egypt, Morocco, Sudan and the Palestinian Territory. A study carried out by Chr. Michelsen Institute shows that Arab aid is largely linked to strategic interests relating to trade, business, religious causes and foreign policy. Aid is also used to promote solidarity between Arab countries. Although many of the poorest countries in the world are on the list of recipients, there is little to indicate that they are given larger amounts than less poor developing countries.
Saudi Arabia’s contribution to the Palestinian Territory is of the same magnitude as the Norwegian contribution. Saudi Arabia has also made a mark as an important donor to earthquake victims in Pakistan, and is actively involved in the reconstruction of Afghanistan, Iraq and Lebanon. A contribution of USD 500 million to the World Food Programme that was announced in connection with the High-Level Meeting on Food Security in 2008 attracted extensive international attention.
Now, new private actors are entering the arena and making large cash donations to aid-related activities. The largest and best known of these is the Bill and Melinda Gates Foundation, which received USD 26 billion from its founders during the period 1994 to 2006. The foundation also receives funds from other donors, the best known being the billionaire Warren Buffet, who has promised to transfer a major shareholding to the foundation. The transfer will take place over many years. When the donation was announced in June 2006, its value was estimated at USD 31 billion, more than ten times the Norwegian aid budget for the same year.
A number of new funds, initiatives and organisations have been established to work on development issues, many of which are very specialised with a narrow thematic focus. Several of them were started by rich philanthropists such as Gates and Buffet. Others stem from the involvement of former politicians, such as the Clinton Foundation.
At the same time, the expanding economies are establishing development and aid activities outside their own countries. This is particularly the case with the BRICS countries (Brazil, Russia, India, China and South Africa), but other countries are also becoming involved.
Figure 7.1 Status of the Millennium Development Goals
Source UN, The Millennium Development Report 2008
Institutions and forums that previously focused on economic and security policy issues are also becoming important arenas for discussing issues relevant to development policy. This is the case, for example, at the G8 meetings, the Davos meeting and in various forums in the EU, NATO and the WTO (World Trade Organization).
New arenas for development policy dialogue have also been established. The last three years, the EU has arranged European Development Days. Since its inception in 2005, the annual meeting of the Clinton Global Initiative, which is held in New York before the UN General Assembly, has become an increasingly important forum for politicians with international ambitions.
The large increase in the number of arenas and actors in the field of development policy reflect both the diversity and fragmentation of the aid architecture. Diversity can lead to better funding for unsolved tasks and provide greater freedom of choice for recipient countries in relation to policy and partners. On the other hand, extensive fragmentation can lead to double work and extra administrative costs for both recipients and donors. For example, it is not unusual for the health sector in a given country to receive support from various funds and UN organisations, the World Bank and various NGOs, as well as government-to-government aid from a number of donors. In some countries, there may be more than 20 donors in one sector, which represents a substantial administrative burden. In addition, one donor country may channel funds through all these different channels to the same sector in the recipient country. Critics argue that this makes overall planning in recipient countries more difficult.
In any case, the changes in the aid architecture necessitate a more strategic approach to our international cooperation. Norad’s Result Report for 2008 points out that Norway does not make sufficient use of the strategic advantages of the various channels. The Government intends to address this issue.
Pursuing all development policy goals through all channels and arenas is neither strategic nor effective. The Government will therefore focus on the comparative advantages of the various channels and arenas.
7.1 Multilateral actors
The main role of multilateral aid is to co-finance tasks that the world community has agreed should be addressed in a joint effort. This either involves donors making core contributions – i.e. contributions that are not earmarked for specific purposes – to the organisation in question, or co-financing larger intenventions, such as UNICEF’s programme to secure education for girls in Africa.
The Government believes that multilateral organisations are particularly well suited to play a leading role in situations where they have particular expertise, where the task is part of their mandate and where their approach has broad donor support. Relevant areas include health, education, infrastructure, aspects of the fight against HIV/AIDS, agriculture and good governance.
However, the multilateral organisations are also important arenas for exerting an influence regarding issues with which Norway is particularly concerned. We pursue the Norwegian political agenda through active participation on committees and boards. This enables us not only to influence the organisations themselves, but also to influence other member countries. Strengthening women’s rights and empowerment is one area where Norway works systematically in various multilateral forums.
We also use our engagement in multilateral organisations to strengthen efforts in areas in which Norway has a particular political interest, but where Norway’s own expertise or capacity is limited. Efforts to prevent deforestation are an obvious example, as are environmental efforts in general. The situation for important target groups such as children, the disabled and indigenous peoples can also be improved through targeted multilateral funding. For example, the United Nations Development Fund for Women (UNIFEM) is an important tool for strengthening the rights and job opportunities of women and their families.
In some cases, Norway can make the greatest contribution to multilateral efforts by influencing the way the much greater funding provided by the other donors is used through our work on various boards. In other cases, it is important to ensure that other countries are able to exert a greater influence, even where the issue concerned is not so important for Norway. This applies in particular to our cooperation with the World Bank, as well as with various UN organisations and global funds and foundations.
Norwegian contributions can also act as a catalyst in terms of bringing new money into development efforts. Or we may earmark multilateral aid for areas that are of particular importance to us. Multilateral aid that is reserved for specific countries is called multi-bilateral aid. In some countries in Latin America, for example, Norway has wished to show solidarity and support new governments. In such cases, it has been an advantage to channel funds through UN organisations as the UN is already established in the countries in question.
The multilateral organisations are important for meeting humanitarian needs following man-made or natural disasters, which often requires extensive international coordination. They also have an important role to play in the prevention of humanitarian disasters and in reconstruction. In addition, multilateral aid has a special function in what are known as aid orphans – countries that receive limited government-to-government support and would otherwise be at risk of losing out in the aid context.
The multilateral organisations have a key role in the work of implementing the Millennium Development Goals agenda. If they are to succeed in meeting this challenge, it is important that their quality and effectiveness are continuously improved.
The United Nations
The UN has a broad presence and is represented in a large number of countries. When a crisis arises, the UN will be one of the first international organisations to provide help. The UN maintains close contact with the authorities in the countries concerned, and often raises controversial issues with them.
Through the various UN organisations, Norway can channel aid to groups and initiatives in a way that reduces the administrative burden both on ourselves and on the recipients.
The effectiveness of the UN’s aid efforts can be hampered by the fact that its capacity and expertise is spread over a large number of entities that work in a fragmented fashion and without adequately coordinated strategies and goals. The gap between the tasks the member states impose on the UN and the resources made available to it comes in addition. The fact that the various UN organisations are constantly having struggle to secure funding – often in competition with each other – also reduces the UN’s effectiveness and ability to achieve goals. This demands time and energy that should be concentrated on solving the tasks at hand.
In 2006, the then UN Secretary-General, Kofi Annan, asked Prime Minister Jens Stoltenberg to co-chair a high-level panel on UN reform, with particular focus on its performance as a development actor. The panel’s report, which was presented in November the same year, recommends the establishment of One UN at country level, with oneleader, supported by a country team consisting of all the UN organisations present in the country in question. Clear priorities for the UN’s efforts in the country are to clarified through the adoption of one programme, which is to by funded via one budget.
The high-level panel’s report has acted as a catalyst for an extensive and concrete reform process. The panel’s recommendations have been tested in eight pilot countries (Albania, Cape Verde, Mozambique, Pakistan, Rwanda, Tanzania, Vietnam and Uruguay) since the beginning of 2007. The feedback from the authorities in these countries is that they now find the UN’s activities more straightforward and relevant, and better able to address the countries’ needs and priorities. The increased visibility and clarification of the UN’s role also appears to have improved funding of the UN’s programme in the pilot countries.
The high-level panel pointed out that the member states should look more closely at their funding of the UN. Unpredictability and widespread and detailed earmarking of contributions makes it difficult for the UN organisations to plan and allocate resources in accordance with the priorities imposed on them. The panel therefore emphasised the importance of giving as much funding as possible in the form of core contributions that are as predictable as possible. Earmarking should be reduced to a minimum.
Figure 7.2 Norway is working for a UN-led world order.
Source Photo: UN Photo/John Isaac
The Government will therefore continue to attach importance to maintaining a high proportion of core contributions and will continue the practice of making indicative multi-year commitments to the key UN organisations. As regards other contributions, emphasis will be placed on linking earmarking to the main priorities adopted by the organisations’ governing bodies. The Government will combine increased financial predictability with clear requirements and expectations of the UN organisations concerned. If these expectations are not met, funds may be reallocated to other UN organisations or other actors.
Norway maintains a critical but constructive dialogue with the UN and its various organisations on the need for reform and improvement. A great deal remains to be done before the UN can fully deliver the results we, as member states, want and expect. However, the substantial progress made during the last two years gives grounds to hope that the UN will succeed in making the adaptations necessary to ensure that it remains a key development actor, also at country level.
The World Bank
The World Bank has an office in every partner country and its aid delivery is regarded as effective. The bank’s employees are generally very highly qualified, and they can seem domineering in their dealings with national public administrations, which are often weak. It is important for the bank’s credibility that it broadens its expertise base, with greater diversity in terms of qualifications and country of origin. There is currently a great preponderance of economists.
The World Bank has been criticised for acting as a proponent of a free market economy and promoting conditionality in economic policy. In many Latin American countries, the World Bank has been perceived as an agent of the US, particularly following the debt crisis in the 1980s. Norway’s view is that it is wrong to impose economic models and solutions on countries. However, the emphasis on national ownership and the fact that many countries have undemocratic regimes may constitute a dilemma. Countries should decide themselves which policies and measures they wish to implement, but in certain areas it is also legitimate and necessary for donors to attach conditions to grants and loans, for example to ensure that these are used as agreed. Aid without conditions is aid without policy and without proper control. We should rather ask what conditions are legitimate to set in connection with debt relief and lending.
Norway has, for several years, promoted a reduction in the number of conditions the World Bank and the International Monetary Fund attach to their loans in general. Several studies, including a review initiated by Norway in 2006, show that conditionality has been reduced. There is now broad agreement about the need to reduce the number and scope of conditions. The Government still wishes the World Bank to set conditions that ensure that funds are spent on reducing poverty and do not go astray, but an independent country should be able to decide itself which tasks are to be a public sector responsibility and what should be left to the private sector. This principle should also apply to borrowing countries.
In connection with the Conference on Conditionality that was held in Oslo in 2006, four country studies were carried out on privatisation and liberalisation requirements in connection with loans from the international financial institutions (IFIs). The conclusions from Mozambique were particularly interesting. It turned out that the World Bank had originally insisted on privatisation of the energy sector, but, on the basis of an analysis from the Scandinavian countries, the bank agreed to the adoption of a different model. This shows that it can be important to develop alternative analyses and models. It is difficult for a poor country that is not in a position to carry out analyses and studies itself to know what the alternatives are to the advice given by the IFIs. It must be possible for other partners to provide alternative assessments and to strengthen and utilise local expertise before a final decision is reached. Experience shows that it is in countries where ownership of reforms and development strategies is strong that the greatest progress is made.
The International Monetary Fund
The International Monetary Fund (IMF) works within three main areas: macroeconomic surveillance, the provision of short-term loans to countries experiencing balance of payment difficulties, and technical assistance. The IMF is not a development institution like the World Bank, and it has no special expertise in relation to combating poverty.
Efforts to promote sound economic policies take place in all of these areas. The IMF furnishes loans to countries with balance of payment problems. Low-income countries can receive loans at a very low or concessional interest rate through various facilities, including the Exogenous Shocks Facility, which helps countries to deal with economic shocks as a result of external factors. The IMF provides technical assistance in a number of areas in the finance sector. The surveillance of member countries’ economic development is also important. The economy of low-income countries with an IMF programme is monitored very closely, and development reviewed regularly. Many donors of government-to-government aid want assurance that recipients are pursuing an economic policy that ensures that the money is well spent. While there is no formal connection between the IMF’s evaluations and financial flows, the IMF can influence the provision of aid and private capital through its assessments.
However, there are aspects of the IMF’s activities that are problematic and that have been the subject of criticism. Although the fund has a remit to furnish short-term balance of payment loans, several of its loans to developing countries have been more long-term in nature as the balance of payments deficit in many countries has been more long-term. The IMF has thus acquired a development role that it was not intended to have.
In addition, the IMF has not given countries sufficient room for manoeuvre when loan programmes have been drawn up. A report from its Independent Evaluation Office shows that the guidelines have not been followed up. Requirements are stipulated for structural changes that are too extensive and detailed and that concern areas in which the organisation does not have sufficient expertise.
The IMF has recently undertaken an extensive quota and voice reform to ensure better representation for low-income countries and emerging economies. This is an important step towards making the IMF more democratic.
The Government believes that the IMF should continue to have an important role in promoting economic growth and reducing poverty, but that there is also room for improvement. The IMF should concentrate on its core tasks and not make liberalisation or privatisation a condition for loans.
The Government would like to see reforms that strengthen the IMF’s legitimacy and effectiveness. A key goal in this context is to ensure constructive cooperation and dialogue between the IMF and international development institutions in order to ensure effective poverty reduction.
Global funds
The global funds involve a wide range of partners and are characterised by a particular focus on results. Norway has contributed to the establishment of several of the global health funds. Today, we have a central role in two of them: GAVI (the Global Alliance for Vaccines and Immunization) and the Global Fund to Fight AIDS, Tuberculosis and Malaria (GFATM). Global funds are managed along the lines of multilateral organisations. In a few years, they have achieved a prominent role in their respective fields, in terms of both size and results. In 2007, the Global Fund to Fight AIDS, Tuberculosis and Malaria funded around 20 per cent of the international effort to combat AIDS, two-thirds of the fight against tuberculosis and three-quarters of the fight against malaria.
The funds have been established to boost efforts in specific areas that can produce rapid results without undermining other efforts. The establishment of global schemes and funds reflects the need to find new ways of achieving results faster and more effectively. At the same time, these efforts must be based on the UN’s normative mandate. The multilateral health organisations are therefore part-owners of the global funds on a par with donors from the private, public and voluntary sectors. The funds are intended to co-exist alongside the traditional health organisations, and to supplement them, not replace them.
Textbox 7.2 Global funds have large target groups
During the five years since its inception, the Global Fund to Fight AIDS, Tuberculosis and Malaria has funded AIDS treatment for 1.4 million people and tuberculosis treatment for 3.3 million. Forty-four million people have received treatment for malaria. In 2007, the fund provided 46 million mosquito nets, an increase of 155 per cent compared with 2006. The increase in the proportion of people who received treatment for AIDS was 88 per cent and 65 per cent for tuberculosis. Since it was established in 2002, the fund has provided more than USD 10 billion for more than 550 programmes in a total of 136 different countries.
Figures from the World Health Organization (WHO) show that, at the end of 2008, GAVI had helped to vaccinate 213 million children and had saved 3.4 million lives.
The global funds and various recently established foundations have been criticised for increasing the fragmentation of aid efforts. It has been claimed that they undermine the UN system by taking over tasks that should really be the job of the UN. On the other hand, it has been pointed out that the traditional institutions are benefiting from this competition and effectiveness is being improved.
The Government believes that these funds and the UN system supplement each other well and have a mutually stimulating effect. The global funds have produced good results in the space of just a few years. In part, this has been made possible by the UN system, while the UN’s own results are in part due to the work of the funds.
Textbox 7.3 The EU Commission
In 2006, aid channelled through the EU Commission by EU member states amounted to EUR 7.5 billion, more than three times as much as Norway’s aid budget for the same year. In all, the EU countries account for around 60 per cent of aid worldwide. The EU’s strength as a regional actor and catalyst for European development is probably best manifested in the regional dialogues the EU conducts, for example with the Asian-Pacific region and the African Union.
As a result of the EU’s enlargement eastwards, there are now new European donor states. These donors are an important resource for the EU’s development policy in that they have different international contacts and domestic experience. Poland, the Czech Republic and Slovakia appear to have progressed furthest in terms of developing an independent development policy. Ireland has also gone from being a recipient of aid to becoming an important donor. The EU’s goal is for the new member states to achieve an aid volume of 0.33 per cent of gross national income, while the old member states are expected to achieve the target set by the Organisation for Economic Co-operation and Development of allocating 0.7 per cent of gross national income to aid by 2015.
The fact that the EU countries channel funds through the EU Commission and that the EU Commission is becoming a multilateral actor entails a diversion of funds that these countries would otherwise have allocated to bilateral efforts or measures funded via the UN or the World Bank. This may lead to increased fragmentation, but the coordination of aid efforts could also improve. It is likely that most importance will be attached to the latter.
It has also been claimed that the funds’ focus on specific areas weakens national structures and sustainable systems. This may be a particular problem in weak states where capacity is already low. In its work on various boards, Norway has strongly advocated that funds should focus more on working within the framework of national systems, while at the same time focusing on and increasing the added value they generate, including mobilising broad groups of actors.
Norway was one of several key partners that worked towards the adoption of a more efficient governance structure for GAVI in 2007. It has also been emphasised that the funds must continue to be based on the UN’s normative mandate for the field of health, even though they are now too large to be administered by WHO and UNICEF. Norway is also at the forefront of efforts to ensure that global funds coordinate their procedures and processes more closely with other multilateral actors, without reducing the added value they generate and their focus on results.
Multilateral aid, including multi-bilateral aid, accounted for 50 per cent of Norwegian aid in 2007.
The Government will:
continue to contribute to strengthening the international system, through both funding and active work on boards
continue to pursue its strong commitment to UN reform and follow up good results with indicative commitments over several years
continue its efforts to ensure that the World Bank does not press for privatisation
strengthen developing countries’ own capacity to develop and assess political alternatives
be a driving force in the efforts to ensure that the global health funds strengthen the whole health system in a country and not just individual bodies
continue its efforts to foster new, non-traditional ways of mobilising funds for development
channel more funding to sectors in which Norway wishes to support agreed international efforts through multilateral actors
continue to exert pressure on the multilateral organisations to work systematically and purposefully for women’s rights and gender equality.
7.2 Government-to-government cooperation
Government-to-government cooperation is based on political dialogue and aid that is provided directly by the Norwegian authorities to the authorities in the recipient country. The dialogue is conducted both at top level and in connection with the actual use of Norwegian funds. These funds are included in the country’s ordinary budget systems and are specified in the national budget. Aid may be given in the form of sector support or directly to concrete projects. Some is given in the form of general budget support, i.e. to be allocated according to the priorities set by democratic structures and with the approval of the parliament in connection with its consideration of the national budget. Budget support both provides funding for important sectors and strengthens democratic budget processes in the countries concerned.
Textbox 7.4 International cooperation for increased aid effectiveness
The Paris Declaration, which was adopted in 2005, is the most important international framework for increasing the effectiveness of development aid. Its three main principles are: mutual agreement to use the recipient countries’ national development strategies (ownership), the use and thereby strengthening of the recipient countries’ systems (alignment) and collaboration and division of labour between donors (harmonisation). The goal is to strengthen the position of recipients in their cooperation with donors, and not least to make them more accountable to their own citizens.
The Evaluation of the Paris Declaration – Synthesis Report that was produced ahead of the High-Level Forum on Aid Effectiveness in Accra in September 2008 showed that progress is being made, but that improvements are less extensive than hoped. There are, however, variations between developing countries, between donors and also between the different commitments in the declaration. The report shows that donors’ use of the recipient country systems has not increased in step with improvements in these systems. In many countries, a great deal of aid to the public sector is still not reflected in the countries’ national budgets. This is serious because the use of the aid funds received is thereby excluded from the democratic decision-making process, at the same time as access to information and control is difficult.
In the international context, Norway has advocated working on the aid effectiveness agenda from a broader development perspective. The Paris Declaration allows for this, and the issue received considerable attention at the Accra meeting. The Government attaches great importance to this issue.
The recipient country’s own poverty reduction strategy forms the basis for long-term development cooperation. The Government will use targeted budget support in order to underpin the partner country’s own efforts and help it to develop a well-functioning state, strengthen democratic processes and improve public welfare services. In its dialogue with recipient countries, Norway will continue to emphasise good governance and good framework conditions for economic development.
As countries establish better systems for budgeting and financial management, the aim is that an increasing proportion of government-to-government aid will be given as general budget support or as programme support to priority sectors.
Government-to-government cooperation is a useful instrument for strengthening direct cooperation between Norway and recipient countries. It gives Norway a quite different role than we have through other aid channels. It provides a good arena for discussions about values and policy development and for the exchange of experience. It gives us an opportunity to bring to the fore issues that are particularly important to us, such as human rights, good financial management with a view to preventing corruption, and the rights of particularly vulnerable groups such as children and young people, sexual minorities, indigenous peoples and the disabled. We can share Norway’s experience in important areas such as women’s rights and empowerment, our distribution policy and the development of our welfare state. And, not least, it also provides a good platform for direct discussions about how the country’s development plans can incorporate measures to address climate and environmental challenges.
Government-to-government cooperation also provides a good basis on which to build alliances that can be useful in other arenas. For example, the extensive political capital we have accumulated over many years of bilateral cooperation was an important factor in connection with the Convention on Cluster Munitions that was signed in Oslo in December 2008.
Government-to-government cooperation means that recipients have a broad range of donors and can choose between these donors’ different approaches to the various sectors. On the other hand, a large number of donors also leads to fragmentation of the overall aid effort. The administrative burden on the recipient country may become very high.
Through the Paris Declaration on Aid Effectiveness, substantial efforts have been made to reduce this burden, but there is still a long way to go. The Accra Agenda for Action of 2008 emphasises that it is vital to further improve the division of labour between donors in order to reduce the administrative burden on recipients.
In the Government’s view, therefore, it is important for Norway to continue to concentrate aid on fewer sectors. We should primarily limit our bilateral cooperation to areas in which Norway has particular expertise and where this expertise is in demand. Our bilateral cooperation may also be linked to areas where Norway’s political weight can increase recipient countries’ attention to key issues on the Norwegian agenda, such as climate change and the rights of vulnerable groups. The areas in which Norway becomes involved must be determined through dialogue with the authorities in the country concerned.
Government-to-government aid accounted for 18 per cent of Norwegian aid in 2007.
Textbox 7.5 Strategic development cooperation generates huge gains in Zambia
Zambia earned very little from its copper mines for many years despite huge price increases and large profits in the industry in general. Its mining agreements were unfavourable with a tax rate of between three and five per cent of the value of the country’s copper exports. This was very low compared with other countries. Calculations showed that Zambia was missing out on the equivalent of the total international development aid to the country every year.
Using Norway’s experience of managing natural and mineral resources as a basis, the Norwegian Embassy worked together with the UK Department for International Development to provide technical and financial support to the Zambian authorities. The goal was to prepare and implement changes in the conditions for international mining operations. Reasonable consideration of the international mining companies’ needs for profitability, investment and technology transfer had to be weighed against the need to ensure that Zambia had a reasonable share of the profits.
The main principle underlying the cooperation was to increase access to broad independent analyses, experience and information so that the Zambian authorities could make independent political decisions concerning the overall strategy and reforms. The Zambian authorities were in charge of the process of procuring and selecting consultants and companies, and they established direct relations with them.
In 2008, the Zambian authorities introduced a new tax regime that increased the average effective tax rate in the mining sector from 31 per cent to 47 per cent. This corresponds to the level in other major mining countries. Zambia thus increased its revenues in the first quarter of 2008 by 300 per cent compared with the previous year. If global copper prices stabilise at a high level, it is estimated that, in the space of a few years, Zambia’s annual tax revenues will correspond to its annual development aid. The next challenge will be to ensure that this money is spent in a sustainable manner.
With the help of some NOK 5 million provided by Norway and good use of Norwegian expertise, Zambia increased its tax revenues by more than NOK 1 billion in 2008 alone. This is an outstanding example of the strategic use of aid and expertise to influence large financial flows.
The Government will:
concentrate government-to-government cooperation on sectors where Norway has expertise that is in demand
reduce the number of sectors for government-to-government cooperation at the country level administered by individual embassies
use the political dialogue with recipient countries to promote women’s rights and gender equality.
7.3 Civil society and NGOs
Non-governmental organisations (NGOs) have traditionally been based on broad popular participation and have been a channel for privately raised funds. Over time, however, public funding has come to account for an increasingly large share of their budgets. NGOs have become a major channel for Norway’s development aid. In 2007, funding via international and local NGOs amounted to NOK 4.3 billion, or roughly a fifth of the total aid budget.
The Government believes that NGOs have a particular role to play in building up their sister organisations and interest groups in developing countries and in strengthening the role of local spokespersons in areas such as environmental issues, human rights, freedom of the media and anti-corruption. One of their advantages in aid delivery is their ability to reach areas and population groups whose needs the state is unable to meet. NGOs also have a high degree of flexibility in critical situations where a swift response is required. They can often be in place very soon after both man-made and natural disasters.
NGOs are important service providers that help to ensure that the fundamental rights to life, health, education and participation in society are attainable for an increasingly larger proportion of the population. Sami organisations and institutions have long had extensive contact with other indigenous peoples elsewhere in the world, and they have built up substantial expertise. This expertise can prove valuable in connection with efforts in areas with indigenous populations. In addition to providing services, NGOs are expected to realise the opportunities for achieving ripple effects in the form of capacity building and changes in attitude.
Figure 7.3 NGOs play an important role in crises
Source Photo: Yasuyoshi Chiba/Scanpix
A series of evaluations since 2006 have documented that Norwegian NGOs have become highly professional actors. However, it is more difficult to ascertain whether they have made a significant contribution to strengthening civil society in poor countries through partnerships with local actors. Local partners often state that they are unable to distinguish between Norwegian NGOs’ roles as donors and partners, and as actors with their own agendas. It is also claimed that foreign NGOs, Norwegian ones included, have a tendency to dominate civil society organisations and their agendas in the partner countries concerned. This also applies to cooperation at the global level.
In this complex situation, it is important that Norwegian NGOs assess the effectiveness of their efforts and their role in relation to the overall development agenda in the countries in which they operate. It is also necessary to increase focus on cooperating with legitimate and representative local partners who cover a broad spectrum of interests and agendas, with which various groups are concerned in developing countries. Work will continue on exploring and implementing alternative forms of support for civil society in poor countries, such as direct support for funding mechanisms and national umbrella organisations that channel funds to the organisations in the recipient countries. The aim is to boost local ownership.
In the space of a few years, globalisation and new communications technology have opened up new opportunities for international awareness-raising efforts. NGOs have successfully grasped opportunities to mobilise international public opinion on fundamental issues relating to development. They have become actors to reckon with in all international contexts.
It is an important task for the Government to support the international efforts of civil society organisations in areas such as environment and climate change, deforestation and forest degradation, gender equality, anti-corruption, conflict resolution and peace-building. It is crucial that representatives of civil society in poor countries have the opportunity to participate fully in this work. Norwegian NGOs have a particular responsibility for helping their partners to gain the access and expertise they need to make use of information, communication channels and forums.
By extension, it is also important to implement information and awareness-raising measures in Norway regarding environmental and development issues in a global perspective, and this should be an integrated part of Norway’s international development cooperation efforts. Civil society has an important role as a driving force and watchdog – in both rich and poor countries.
Migrant communities – diasporas
A diaspora is a group of immigrants and their descendants who have an attachment to a specific country of origin. Large groups from Pakistan and Somalia live in Norway, but there are also groups from Iraq, Vietnam, Iran and Sri Lanka, as well as the US, Russia, Turkey and a number of European countries.
These minority groups have resources that have been utilised too little in the Norwegian development policy context. They possess valuable knowledge about culture, language, society, history, religion and politics. Both individuals and organisations have good contact with key milieus in their own or their parents’ country of origin. They can provide important information and improve our understanding of ongoing political processes.
In 2008, the Ministry of Foreign Affairs launched Pilot Project Pakistan with a view to increasing the local development effect of remittances. Under this scheme, Norwegian–Pakistani organisations can apply for funding corresponding to the amount they themselves are sending. The project will increase awareness about development efforts in the groups concerned, thus facilitating cooperation with development aid organisations. The pilot project will also strengthen the position of diaspora and immigrant organisations in the competition for aid funds. The pilot project is for projects in Pakistan. The experience gained will be an important factor for assessing whether the model can be expanded to include other countries.
It is also important for other bodies in Norway to realise what a resource communities and groups with links to relevant developing countries can represent. NGOs, research communities and, not least, the development aid administration have a great deal to gain from closer collaboration with these groups. This is a good basis for forming strategic alliances in the time ahead.
Recruiting people from multicultural backgrounds will be an important contribution towards ensuring that the foreign service reflects developments in Norwegian society, and will also help to ensure that the particular competence that these groups possess is used.
Support channelled via Norwegian, international and local NGOs accounted for 21 per cent of Norwegian aid in 2007.
The Government will:
continue its close cooperation with Norwegian NGOs, with regard to both their development aid work and their information and lobbying activities in Norway
continue to support NGOs’ global efforts in key areas
emphasise closer cooperation with migrant communities in Norway and organisations that work on development issues
carry out a pilot project in Pakistan based on co-financing by the Pakistani diaspora and the public sector. Consider the possibility of corresponding initiatives in other countries
ensure the recruitment of persons from multicultural backgrounds to the foreign service.
7.4 Business and industry and the private sector
The Government is encouraging Norwegian enterprises to become more strongly involved in the private sector in developing countries. In addition to providing valuable capital, which provides a basis for economic growth, such involvement can help to promote important values and principles in the development of the country’s own private sector.
There are therefore a number of publicly-funded support schemes aimed at promoting such partnerships and reducing the risk for Norwegian companies of participating in developing these markets. Norad (the Norwegian Agency for Development Cooperation) and Norfund (the Norwegian Investment Fund for Developing Countries) have cooperated on the establishment of an advisory office for enterprises that wish to make use of these schemes.
Textbox 7.6 Norfund
Norfund is a state-owned investment fund that seeks to strengthen the private sector and hence the development of poor countries through profitable investments. The aim is to increase these countries’ ability to create value, generate economic growth and develop a sustainable economy. In addition to its commercial goal, Norfund must conduct its activities in accordance with fundamental principles for Norwegian development policy and contribute to a better working environment and working conditions in the countries concerned.
Norfund invests in private enterprises, thus helping to boost employment, facilitate the transfer of technology and expertise, and increase tax revenues. It has an equity of NOK 4.5 billion. It is Norway’s largest investor in microfinance and hydroelectric power in Africa, Asia and Latin America. Norfund’s investment capital comes from annual allocations from the development aid budget.
In step with the higher priority given to private sector development in development policy, Norfund has been assigned more wide-ranging tasks relating to renewable energy and microfinance, and to cooperation between public and private actors on financing. The fund’s strategy is based on a sector-by-sector focus within geographically limited areas in which the fund itself has expertise and capital to offer partners. Norfund also facilitates investment projects in the poorest countries, with a view to becoming more active in these.
Embassies can also provide country-specific knowledge and open doors in the countries concerned.
The objective of Norfund is to contribute to economic development in poor countries through profitable investments. In recent years, Norfund has received almost NOK 500 million annually in new investment capital. The fund has also been assigned new tasks through strategic escalation of collaboration between public and private actors.
Textbox 7.7 The Norwegian Microfinance Initiative
Many poor people are unable to obtain bank loans because they do not have a regular income or are unable to provide security. This is particularly true for women, because in many countries their rights to inherit and own land, housing and other property are weak. Microfinance provides financial services for poor people. In addition to providing loans, emphasis is also placed on facilitating saving, insurance schemes, money transfers and such like.
The Norwegian Microfinance Initiative was established in September 2008 as a public–private partnership between the Norwegian authorities and the private sector actors Ferd, DnB Nor, KLP and Storebrand. The fund has a total equity capital of NOK 600 million, which is used to invest in microfinance institutions. The goal of the Norwegian Microfinance Initiative is to strengthen the position of the poor in developing countries by helping to create jobs and welfare on a sustainable basis.
There is a substantial flow of direct Norwegian investments to developing countries. The largest flows relate to investments made by the largest companies in Norway, primarily in countries with oil and gas or other natural resources. An important task for Norwegian development policy is to increase the private sector’s willingness to make direct investments in developing countries in other areas as well.
An important factor in this context is the Norwegian Microfinance Initiative, in which the Norwegian state and private investors have each contributed 50 per cent to a fund that will invest in microcredit activities in developing countries.
It is also possible to develop corresponding collaborations in areas such as renewable energy and in strategic cooperation agreements between the state and major investors. The Government’s strategic partnerships with Yara and SNPower are examples of the latter.
Support for private sector engagement in developing countries accounted for eight per cent of development aid in 2007.
The Government will:
help the Norwegian business community to increase its involvement in developing countries through various support schemes and active facilitation on the part of embassies in relevant countries
help to develop public–private partnerships between the Norwegian authorities and private sector actors with a view to mobilising private capital for viable investments in the private sector in developing countries.
7.5 Choice of partner countries
Traditionally, Norway has used the terms «partner countries» and «main partner countries» to describe the main groups of recipients of government-to-government aid. These countries have received support for long-term development efforts under regional allocations (category 03.10 in the budget proposal). The arrangement meant a high degree of predictability for recipient countries, but in practice there was little connection between how the countries were categorised and how much aid they received. Sudan and Afghanistan were among Norway’s largest recipient countries, but because funding came from budget categories other than 03.10, they were not referred to as partner countries. Since category 03.10 only accounts for 16–18 per cent of the aid budget, these designations were not very informative. Administration of this budget category was transferred from Norad to the Ministry of Foreign Affairs in 2004 as part of a process to improve coordination of the aid system. The discontinuation of these designations was a natural consequence of this step.
The fact that only category 03.10 could be used in countries designated as «partner countries» also restricted Norway’s ability to respond rapidly in specific situations. One example is the change that took place in Burundi when the humanitarian crisis became less acute, and the international community needed to focus on stabilisation and state-building efforts. When Liberia finally succeeded in holding free elections and Ellen Johnson Sirleaf became Africa’s first female president, there was also a need for swift political and practical support from the international community.
The Government clearly stated in its 2008 budget proposal that it was no longer expedient to continue with the distinction between main partner countries and other partner countries. A majority in the Storting supported this in its subsequent budget recommendation, and requested a discussion about these concepts and the classification and selection of countries, and that possible alterations should be presented to the Storting. This was followed up in the 2009 budget proposal, which also does away with the classification «partner countries for long-term bilateral development cooperation», and instead describes how different types of cooperation is combined in different types of countries.
In addition to category 03.10, partner countries also receive aid from a number of other chapter items. Roughly 40 countries receive funds from allocations managed and allocated to individual countries by the Ministry. In 2009, the largest recipients of Norwegian aid will be Afghanistan, the Palestinian Territory, Sudan, Tanzania and Mozambique.
There are several reasons why we should be flexible in relation to our choice of partner countries. The Government wishes to use development aid more strategically. In some countries, cooperation will be very extensive, while in others it will be more narrowly targeted. In some cases, short-term humanitarian aid may be needed, or a rapid response to a changing conflict situation, while in others extensive long-term efforts are required. The nature of the cooperation will also change over time in step with the development and needs of the partner country in question. In countries such as Angola and Vietnam, our efforts have changed from extensive cooperation in a wide range of areas to focus on private sector development and technical cooperation.
Norway is engaged in broad long-term cooperation with a number of countries. Some of these are relatively stable states such as Tanzania, Mozambique, Zambia, Malawi and Nicaragua, where Norway’s efforts are primarily aimed at supporting these countries’ fight against poverty.
In other countries such as Afghanistan, Sudan, Nepal and the Palestinian Territory, the goal of poverty reduction can only be achieved through focusing much of our efforts on stabilisation, reconciliation and state-building, because these countries are in a highly vulnerable situation. Cooperation with these countries requires quite different insight and political sensitivity.
In relation to all of these recipients, Norway has a broad engagement based on the country’s own poverty reduction strategy, with a substantial volume of assistance and an extensive local presence. The funding is provided via several budget chapters. Both our efforts in, and funding to fragile states have increased in recent years. The Government wishes to continue its extensive engagement in these countries.
In countries such as the Philippines, Haiti, Columbia and the Balkan countries, cooperation is linked to peace and reconciliation processes. The amount of support varies, and this is a demanding form of political engagement, requiring a long-term approach. A common feature for these efforts is that they involve major political risk. In some cases, Norway itself is a facilitator in peace processes, but in most cases, Norway’s role is to support the efforts of the UN or other organisations to promote peace and reconciliation.
Figure 7.4 Largest recipients of Norwegian development aid.
Source Norad
In a significant number of countries, our efforts have a more thematic or strategic character. Bilateral efforts to combat child and maternal mortality, for example, are limited to Nigeria, India, Tanzania and Pakistan. So far, Norway’s International Climate and Forest Initiative entails bilateral cooperation with two countries, Brazil and Tanzania. Substantial funding is also being provided for projects in the Congo basin through the African Development Bank, and to a number of other countries through UN and World Bank forest programmes. The Oil for Development initiative cooperates with Angola, Mozambique, Ghana, Madagascar and Afghanistan. Norway is also engaged in private sector and technical cooperation with a number of countries, including China, India, Angola and Vietnam.
Humanitarian aid is provided through multilateral funds or concentrated on countries and areas with major unmet humanitarian needs, where Norway is particularly well qualified to contribute, and where the efforts can support peace and reconciliation processes. The volume of humanitarian assistance provided to different regions and countries depends on shifting needs. In countries with ongoing crises, the level of humanitarian assistance may be maintained for some time. Children, minorities and indigenous peoples are priority groups. Empowerment and protection of women are also priorities. These priorities are reflected in our involvement in countries such as Somalia, Burma, the Democratic Republic of Congo, Colombia, North Korea and Iraq.
The Government will continue to focus on providing aid to fragile states. This will include humanitarian aid, support for peace and reconciliation processes and long-term development aid. Norway is also strongly engaged in conflict resolution and peace efforts in a number of fragile states. The increased emphasis on fragile states is creating closer links between foreign policy and development policy. It makes Norway an important actor at both country level and in international forums.
Norway’s policy towards fragile states is in line with the international community’s focus on building stable states where the authorities can attend to the population’s needs and take responsibility for addressing international problems such as terrorism and climate change. The closer links between foreign policy and development policy tools highlight the need to respond rapidly to acute needs in fragile states. The Government therefore sees it as inexpedient to classify countries according to the budget category through which they receive support. The Government wishes to encourage discussion about the aid budget as a whole, with emphasis on the objective of the support given to individual countries.
The Government will:
be more flexible in the selection of countries that receive aid
continue to emphasise fragile states in our development policy
7.6 Key arenas
There is a difference between arenas in which binding resolutions with normative guidelines are passed and funds allocated, and discussion forums where ideas are exchanged and developed.
Binding agreements shift power. They assign responsibility, obligations and rights that have a bearing on national policy. Such agreements acquire great legitimacy and normative power. At the same time, however, less binding processes have a key role to play in the work of developing new ideas and approaches. Many important international processes have originated in arenas of this type. In many cases there is massive pressure from grassroots organisations. With the help of modern information technology, NGOs, networks and lobby groups are able to launch effective, targeted campaigns and can thus set the agenda. Success stories, such as the political decisions on debt relief, the prohibition of cluster munitions and protection of rainforests are all examples of how grassroots initiatives can influence global politics.
The G8 is a forum that has succeeded in putting important development policy issues high up on the international agenda. This became clear at the Gleneagles Summit in 2005, at which the member countries agreed to double their aid by 2010, USD 25 billion of which was to be earmarked for Africa. That was a strong signal, but follow-up has been weak. However, the G8 has also addressed other important global challenges with a bearing on development policy, such as climate issues, the food crisis and corruption. As the financial crisis developed, it became clear that the G8 would have to expand its membership in order to play the role it wished to play. The expansion resulted in the G20, which includes the world’s 20 most important economies. Norway has frequently had bilateral discussions with the individual member countries of the G8 on its work. We are not part of the G20, and we need to find good forms of cooperation, both with the group as a whole and with the individual member countries.
The World Economic Forum (WEF), which meets every year in Davos, increasingly includes development-related issues on its agenda. Innovative financing mechanisms are a recurring topic. For several years, the Davos meetings have been a key forum for Norway to discuss the vaccination campaign that Prime Minister Jens Stoltenberg has spearheaded together with Gordon Brown and Tony Blair. In the time ahead, the Government will also focus on its policy relating to illicit financial flows and tax havens at these meetings.
Decisions made in NATO are binding on its member states. In recent years, NATO has become more involved in issues relating to development policy. Experience from Afghanistan in particular has shown how important security is for development, and, conversely, how important development is for security. This creates grey areas where, in practice, the dividing line between military and humanitarian assignments is unclear.
Norway has emphasised the established principle for civil-military cooperation, that international humanitarian efforts should primarily be carried out by civilians and coordinated by the UN in as close consultation as possible with local authorities. In exceptional cases, the need for rapid and effective aid may necessitate drawing on military resources, particularly in relation to logistics and transport. NATO should also be able to contribute to aid efforts in connection with major natural disasters. However, it must be a precondition that it does so at the direct request of the UN or the countries that are directly affected. As a rule, assistance from NATO should be limited to the initial phase of emergency efforts, during which rapid distribution is a crucial consideration. After that, civilian actors should take over. NATO’s assistance must give added value and must not outcompete other actors. This necessitates close and regular coordination with the UN. A dialogue on disaster relief should be included in the broader cooperation between the UN and NATO.
Figure 7.5 The financial crisis requires broad international cooperation. It cannot be solved by Western countries alone. The first meeting of the G20 group in November 2008 was an important milestone in relations between new and established major economies.
Source Photo: Stephen Jaffe/Scanpix
The EU has long shown interest in Norway as a development actor, and it wishes to have a closer dialogue with us on issues such as the connection between climate change and development, financial flows, tax havens and oil for development. The EU, on its part, conducts a development policy dialogue with actors with which Norway would like to have closer contact. The tripartite dialogue between the EU, Africa and China is of particular interest.
Norway has participated in informal meetings with EU at ministerial and senior official level. Norway also takes part in the European Development Days. This is to our mutual benefit. The EU is an important alliance partner in development policy. The Government wishes to strengthen its development policy cooperation with the EU in the time ahead.
The Government will:
use international arenas more strategically to promote Norwegian development policy positions
initiate closer cooperation with the EU in the field of development policy.
7.7 A future without aid?
The purpose of aid is twofold: to finance important initiatives and to give donors an opportunity to take part in discussions about development in individual countries. Both these dimensions – the political and financial – are crucial for combating poverty and building democratic societies. There has been increasing emphasis on the political dimension, particularly the efforts to promote human rights and combat corruption, during the 50 years that the rich countries have been involved in organised aid efforts.
There will probably be a great need for aid in many countries for many years to come. For some countries, however, other sources of development financing could gradually become more attractive to recipients because they are less tied to issues relating to governance and rights. Remittances, investments, tax revenues and loans and support from countries outside the OECD already account for larger financial flows than aid. Seen in isolation, this is obviously positive; aid should never be a goal in itself, merely a means to an end. However, it could also weaken the general political dialogue with countries facing major challenges in relation to human rights, corruption and governance, in addition to extensive poverty problems. Having pursued an active development policy for 50 years, Norway is regarded a credible and desirable partner for many countries, and for numerous organisations and centres of expertise. A large number of these have expressed a strong desire to continue close cooperation with Norway in future, regardless of the framework this entails.
Textbox 7.8 Attractive investments
«We like Chinese investment because we have one meeting, we discuss what they want to do, and then they just do it. There are no benchmarks and preconditions, no environmental impact assessment. If a G8 country had offered to rebuild the stadium, we’d still be having meetings about it.»
Source Sahr Johnny, Sierra Leone’s Ambassador to the People’s Republic of China, who was showing Chinese investors around potential development sites, New Statesman 4 July 2005.
The Government therefore feels that it would be wise, even now while aid is still very much in demand, to actively strengthen strategic alliances with recipient countries with a view to continued cooperation in the future when aid may not be the cornerstone of our relations. Research communities and academia, the business community, NGOs, media, and political and cultural cooperation could be the pillars on which such a collaboration could be built.
The Government will:
prepare an action plan for strengthening strategic alliances that can form the basis for partner relations in countries in which aid gradually ceases to be the key element.
7.8 Results, quality assurance and potential for improvement
Aid works – but not well enough was the main message of Norad’s Results Report for 2007, which emphasised that aid produces important results, but that aid alone cannot promote development in the country concerned or reach the ambitious goals set by the international community.
Aid has helped to increase life expectancy and improve health and education. These are important results, particularly in light of the strong growth in the world’s population in recent years. Calculations also show that aid has led to annual economic growth in African countries in the region of one per cent. This may seem modest, but it means that without aid Africa would have been 25 per cent poorer.
Evaluations of Norwegian-financed aid programmes show that many good results are achieved. This is confirmed by findings from several hundred reviews of projects that receive Norwegian funding. The long-term social consequences are difficult to quantify, however. Norway is just one of many donors in a country, and there are many factors unrelated to aid that influence development. It is therefore difficult to trace results at the national level directly to specific projects or programmes supported by Norway – or by other donors for that matter.
The Results Report for 2008, Development assistance – no shortcuts to good results, shows that good results are achieved via all channels; Norwegian aid reaches the target groups. However, the report also points out that the various advantages of the different channels are not utilised systematically enough.
The results are substantial seen in relation to the amount of Norwegian aid. There are two ways in particular that Norwegian efforts have influenced international development cooperation over the years: the early emphasis on recipients’ responsibility for their own development; and the recognition that no society can be developed from the outside. Moreover, the Norwegian focus on the opportunities available to and rights of women, indigenous peoples and other vulnerable groups has also been important and valuable.
Cooperation based on both technical and political dialogue produces good results. Likewise, more goals are achieved when efforts focus on areas that are high priority and in demand in the country concerned. Budget and sector support have become important instruments in this context, and the results are good.
It is easier to measure the results of efforts in a delimited thematic area, such as the global health initiatives, than long-term sector initiatives. This makes thematic initiatives well-suited to mobilising political will for joint efforts that will make a difference at the global level.
There are many indications that long-term cooperation may be needed to achieve lasting results. It is necessary to think 20 to 30 years ahead in the least developed countries. Another important lesson is that good technical assistance and exchanges do not automatically result in capacity- and institution-building. Competence-building is often valuable for the individuals concerned, while the results at the institutional level may be limited. This means that we have yet to find the best form of technical cooperation and training.
Textbox 7.9 Budget support
The term «budget support» refers to funds that are paid into the recipient country’s treasury, where they are pooled with the country’s own revenues. How the money is spent is decided by the parliament through normal budgetary processes. The donors stipulate joint conditions relating to improving public financial management systems, strengthening the poverty profile in the national budget and implementing anti-corruption measures.
In 2006, a multi-donor report on the results of budget support was produced. It covered the period from 1994 to 2004 and included seven countries: Malawi, Mozambique, Nicaragua, Uganda, Vietnam, Burkina Faso and Rwanda.
The report concluded that budget support has had positive effects on public financial management. It has increased the authorities’ ownership and accountability and led to more systematic links between strategic planning and results.
The report also concluded that budget support can be an effective, expedient and sustainable method for supporting poverty reduction strategies. Budget support has clearly played a positive role in five of the seven countries studied (Burkina Faso, Mozambique, Rwanda, Uganda and Vietnam). In Nicaragua, budget support efforts have not come far enough for reliable conclusions to be drawn. In Malawi, budget support was deemed to be unsuccessful and it was stopped. It has subsequently been resumed following adjustments to the programme. The Malawian authorities have substantially improved financial management.
The report shows that budget support is no more vulnerable to corruption than other forms of aid. Budget support has contributed to the prioritisation of efforts that are important to the poorest, and that expenditure on health and education increased during the period studied.
Following up results
Although it is difficult to measure the effect of aid on development in a particular country, it is still necessary to verify and document results. Good information about results is important to maintain confidence in aid both in Norway and in partner countries. We know from our own experience that it is difficult to measure the results of allocations of public funds. It is no easier in countries with weak institutions and limited capacity.
The public, private and civil sectors all deliver services that are important to people’s welfare and to nation- and state-building. Well-functioning institutions are essential for a well-functioning state. It is necessary, therefore, to strengthen partner countries’ institutional competence and capacity with regard to result-oriented planning and management, and their ability to report on and learn from results and experience.
Norway increasingly participates in joint evaluations and reviews, in international work to develop methodology for evaluating and following up results, and in international forums aimed at increasing aid effectiveness.
The Norwegian aid administration has established extensive procedures for following up results at project, sector, country and agency level. Plans, results, budgets and expenditure are documented through three-year rolling strategic plans for Norwegian aid to more than 30 partner countries. Adjusted plans and strategies are then drawn up on the basis of the results achieved and experience gained and both Norway’s and the recipient country’s political priorities. A corresponding system is used in connection with Norad’s cooperation with NGOs.
Quality assurance
Few sectors are subjected to such frequent and extensive control as the «aid industry». In addition to the regular reviews of the Norwegian aid administration carried out by the Office of the Auditor General, a number of control and quality assurance measures have been initiated by the Ministry of Foreign Affairs and Norad with a view to uncovering and remedying any weaknesses in the system.
New guidelines have been drawn up, and a central support function has been established with overall responsibility in the Ministry for ensuring uniform administration of Norwegian grants.
In order to ensure that rules and procedures are complied with, frequent performance reviews are carried out at embassies, in the Ministry and in Norad. Good systems have been developed for following up findings and recommendations.
Mandatory procedures have been developed for assessing the risk of corruption and following up suspected irregularities in all projects. Everyone who works in the foreign service receives anti-corruption training. Norway promotes greater transparency with respect to the use of aid funds. We support the Publish What You Pay campaign. The Ministry of Foreign Affairs and Norad have established whistle-blowing systems for reporting suspected cases of corruption.
Despite good systems for control, cases are regularly uncovered in which funds have been misappropriated and planned outcomes have failed to materialise. There are several reasons for this, and it serves to demonstrate how challenging aid efforts are. The Ministry of Foreign Affairs and Norad deal with these challenges by continuously updating and revising their control and quality assurance systems. Targeted efforts to increase our partners’ capacity and competence to develop and apply their own systems are equally important. Thorough and comprehensive evaluations of all partners are carried out in advance. Particular emphasis is placed on their capacity and competence to manage Norwegian funds and to achieve planned outcomes.
A special toolbox has been developed for quality assurance in the form of a series of handbooks and guides. They are based on a broad range of international experience. Everyone who administers aid funds can also request sector or administrative advice. Continuous legal quality assurance of agreements, contracts and procurements also helps to reduce risk and increase the possibility of achieving the planned results. All foreign service staff with administrative responsibility undergo mandatory administrative training. Much of this training is open to partners in Norway and abroad.
Developing knowledge
The development of new knowledge largely involves research, but it can also entail other factors. These include studies or comparisons of available research results by expert committees such as the Norwegian Policy Coherence Commission and the Commission on Capital Flight from Developing Countries, as well as the systemisation of lessons learned and experience gained from work in the field.
In this connection, it is also necessary to include the perspectives of developing countries to ensure that the knowledge gained is less biased by a Western perspective. In this connection, there are two tasks that need to be fulfilled at the same time: increasing the quality and relevance of research; and strengthening research institutions in developing countries. The active recruitment of Norwegian researchers from multicultural backgrounds will give added value to Norwegian research institutions.
There is a great deal of research on and evaluations of aid programmes and the effect they have. The Government wishes this to continue, but with more emphasis on how aid can best be used strategically in connection with important development processes. Aid is often evaluated in a vacuum, rather than as one of many factors that contribute to development.
More systematic use of current knowledge
There is already a great deal of relevant knowledge about development, but it is a challenge for the administration to utilise it.
Norad is the centre of technical expertise for the Ministry of Foreign Affairs and the embassies. It has solid, broad-based expertise in a number of fields within the aid sector. It also cooperates with a number of external expert groups, including research institutions, ministries and directorates, and other expert bodies.
Efforts are being made to ensure that the Ministry of Foreign Affairs and Norad become even better at using available knowledge more systematically in their day-to-day work. In 2007, Norad entered into agreements with the Research Council of Norway and the Centre for Development and Environment on various communication activities to improve knowledge in the government administration. All aid programmes are also required to include communication plans and to organise expert conferences to which the public administration is invited. Norad and the Ministry of Foreign Affairs also invite researchers from abroad to come and present results in relevant fields. During the current parliamentary period, the Ministry of Foreign Affairs established the project «Refleks – globalisation and national interests» (the Refleks project) under the auspices of the Minister of Foreign Affairs, as well as the Minister of International Development’s policy analysis unit. Both of these are responsible for following up international and national knowledge development.
It has been found that commissioned research and studies are the most used forms of research. These are delivered quickly and often have a form that is well suited to respond to particular needs. However, a dilemma may arise, since the assignment is defined by the client and is not subject to an academic quality assurance process. Normally research programmes are subject to competition, both in advance, in the selection process, and subsequently, through peer reviews prior to publication. This quality control is not as systematic in commissioned research and studies.
The Research Council of Norway and research institutions need to discuss more closely the development of good systems for supporting long-term research and, at the same time, ensuring that the knowledge produced through research programmes, including basic research, is made available to users in a suitable form and time frame. One way forward is to use research programmes to build up stronger long-term centres of expertise specialising in priority areas in Norwegian development and foreign policy, and to further strengthen existing centres of expertise.
The Government will:
strengthen focus on results and aid effectiveness
ensure transparency and access to information with regard to the Norwegian aid administration
seek to make relevant knowledge about development more readily accessible to the aid administration
promote research in Norway into priority areas for development policy and into the complex factors that promote or impede development.