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The future of aid, 2005- 2010 Setting the scene: trends and forces shaping the aid system.

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Presentation on theme: "The future of aid, 2005- 2010 Setting the scene: trends and forces shaping the aid system."— Presentation transcript:

1 The future of aid, Setting the scene: trends and forces shaping the aid system

2 Why now? 2005 is decision time, coherent or not: 2005 is decision time, coherent or not: Post-9/11 foreign policies still in flux, Post-9/11 foreign policies still in flux, Impacting the fragile 2002 aid consensus, Impacting the fragile 2002 aid consensus, While new schemes graft onto old system; While new schemes graft onto old system; UK/EU and US can innovate UK/EU and US can innovate

3 Whats up for discussion? The credibility of the Millennium Goals The credibility of the Millennium Goals Should aid double and if so, how; Should aid double and if so, how; Aid if no trade?; Aid if no trade?; Who runs the IMF and World Bank; Who runs the IMF and World Bank; Value-added of EU and UN; Value-added of EU and UN; How to pay for global goods. How to pay for global goods.

4 The aid system today Talking ODA, mainly Talking ODA, mainly Some 75 agencies, $58 billion p.a. Some 75 agencies, $58 billion p.a. Much of it technical, humanitarian Much of it technical, humanitarian No exits and many entries No exits and many entries Weak users, weak owners Weak users, weak owners

5 Four shaping forces 1. Shrinking middle on the demand side 2. Multiple donor objectives 3. Symbiotic relationships with NGOs 4. Institutional barriers to competition

6 Conventional wisdom after Monterrey Consensus Consensus Better, simpler aid Better, simpler aid Predictability Predictability Millennium Goals Millennium Goals Ownership and PRS Ownership and PRS Performance-based Performance-based Achilles Heel Achilles Heel Cost-benefit? Cost-benefit? Short termism Short termism Growth, shelf life Growth, shelf life Conditionality Conditionality Selectivity Selectivity

7 Unfinished Business Aid volume and Absorption Aid volume and Absorption New Tied Aid New Tied Aid Selectivity and Balance Selectivity and Balance Grants versus Loans Grants versus Loans

8 New Wine into old bottles The Millennium Challenge Account: beyond conditionality? The Millennium Challenge Account: beyond conditionality? The Global Fund: chip off the old block? The Global Fund: chip off the old block? The International Financing Facility: opportunity to reshape global aid governance? The International Financing Facility: opportunity to reshape global aid governance?

9 2010, a snapshot : two sketches among many Poverty +/- Poverty +/- Tied aid +/- Tied aid +/- MDG triumph/ fade MDG triumph/ fade UN, EU, up/down UN, EU, up/down Pivot role of MICs Pivot role of MICs Competition +/- Competition +/- Recipient choice +/- Recipient choice +/- More, less bilaterals More, less bilaterals More, less NGOs More, less NGOs Pivot role of MICs Pivot role of MICs


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