ODA Improvements for the Post 2015 Development Agenda

enjoToday as a part of the Development Cooperation Forum, a meeting was held to discuss the role of Official Development Assistance (ODA) in the post 2015 development agenda. Beginning the meeting, Ms. Randel gave a statement on the critical role of ODA in eradicating extreme poverty, and how to target and better mobilize resources for development. In recent years ODA has increased, with 2013 having the highest recorded ODA expenditures. However, Ms. Randel pointed out that ODA must focus on impacting the bottom 20% of Least Developed Countries (LDCs). Ms. Randel also pointed out the importance of harnessing other resources for development like foreign direct investment, remittances, and public/private debt flows.

Following, H.E. Mr. Géro of Benin spoke about how ODA is needed as a tool for investment in developing countries for roads, energy infrastructure, transportation, and industrialization. Markets are very new in developing countries, and oftentimes developing countries are excluded from participating in the global market, so ODA is needed to make up for this deficit. He concluded by stating that ODA must not be guided by political considerations, but rather guided by considerations of what development objectives we hope to achieve.

Next, Mr. Solheim from OECD gave a statement on suggestions to improve ODA. He said that ODA should be targeted more towards LDCs, because even though overall ODA amounts are increasing, they are decreasing for LDCs and fragile states. Mr. Solheim also suggested improving ODA by targeting it towards encouraging more private investment, supporting peace, and using it to assist countries in domestic resource mobilization and better taxation systems.

Following, Mr. Alonso emphasized the importance of ODA in Middle Income Countries (MICs), stating that MICs need development assistance as well in order for them to meet their development goals. Overall, there has been a reduction in global absolute poverty, but an increase in relative poverty in MICs.

Concluding the meeting, H.E. Mr. Phuong of Viet Nam stated that in the post 2015 development agenda, ODA should be used together with public expenditures to attract private investment, directly tackle poverty, and support developing countries socioeconomic development plans. He also called for climate change adaptation projects, the efficient use of natural resources, institutional reforms, and capacity building to help developing countries tap into their national funds.

 

Meeting Title: Development Cooperation Forum Session 2 “The critical role of Offical Development Assistance (ODA) in development cooperation post-2015”
Speakers: Ms. Judith Randel, Executive Director, Development Initiatives, United Kingdom of Great Britian and Northern Ireland; His Excellency Fulbert Amoussouga Géro, Minister at the Presidency of the Republic of Benin, in charge of coordinating policies and implementation of the MDGs and the SDGs; Mr. Erik Solheim, Chair, Development Assistance Committee, Organization for Economic Cooperation and Development (OECD); Mr. José Antonio Alonso, Professor, Universidad Complutense of Madrid; H.E. Nguyen The Phuong, Vice Minister of Planning and Investment, Viet Nam
Date: 10 July 2014
Location: Conference Room 2, United Nations HQ, New York
Written By WIT Representative: Marli Kasdan

 

In Search of a New Definition of ODA

Mr. Gass opened the panel by stating that the discussion on the future of Official Development Assistance (ODA) is an important one, for “ODA will be critical, but not sufficient” for the implementation of the SDGs. He also recognized that ODA is outshined by other sources of financing for development. However, he added that as long as the total funding channeled to developing countries meets the demand, it is not necessarily a change for the worse.

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Mr. Kwakkenbos stated that 2013 saw a huge increase in ODA, but the increase came in form of loans but not gratuitous grants. Further, while ODA to middle-income countries increased, ODA to the least developed countries (LLDCs) suffered a setback in the last decade. Mr. Guillaumont suggested that one way to redress to lack of attention to LLDCs is to provide more loans to the LLDCs, as it is often difficult for them to access commercial lending market. Dr. Chaturvedi responded to the calls for redirecting loans from middle-income country to the LLDCs, saying that middle-income countries like India will still need ODA in forms of loans in support of infrastructural projects.

 

Mr. Solheim brought to the panel two messages. The first is the recognition of the new sources of financing, including private funding and South-South cooperation funding. The second contains some proposals on the ways in which the future definition of the ODA may be redefined. He proposed that future government encouragement of private investment into developing countries may be counted towards ODA. Further, there should be consensus on whether loans should be considered as part of the ODA. The current calculus only consider the difference between the commercial and concessional interest rate as part of the ODA, which means contribution from donors lending to countries with high possibility of default are not taken account into the ODA.

Meeting Title: New measures for development financing in a Post-2015 world
Speakers: His Excellency Mr. Thomas Gass, Assistant Secretary-General for Policy Coordination and Inter-Agency Affairs; Mr. Erik Solehim, Chair of the Developmental Assistance Committee of the Organization for Economic Cooepration and Development; Dr. Sachin Chaturvedi, Research and Information system for Developing Countries; Mr. Jeroen Kwakkenbos, Policy and Advocacy Manager, Eurodad; Mr. Patrick Guillaumont, President, Fondation pour les etudes et recherches sur le developpement international (FERDI)
Location: Conference Room 5, North Lawn Building, United Nations Headquarters
Date: 10 July 2014
Written By WIT Representative: Harrison Chung
Edited By WIT Representative: Marli Kasdan