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The Role of Multilateral Agencies

Financing Development to Achieve The Millennium Development Goals Meeting

Doha, QatarJune 17-18, 2007

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Outline of the Presentation

1. Aid architecture: some key features.2. Other financial flows.3. The roles of and challenges facing the

multilateral system.

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Multilateral ODA by channel(net disbursements, $ million at 2004 prices, 1960-2005,

period averages)

0100020003000400050006000700080009000

1960-69 1970-79 1980-89 1990-00 2001-05

Regional BanksOther AgenciesIDAUN AgenciesEC

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Private Flows to Sub-Saharan Africa (billions US$)

Remittances

Remittances

0

5

10

15

20

25

30

1995 2004

Private debtand portfolioequityForeigndirectinvestmentOfficialdevelopmentassistance

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Entry of Many New Actors

• China’s commitments in Africa are more than any other donor

• International private philanthropy (Gates Foundation) providing significant funding

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The number of bilateral donors has grown from 5-6 in the mid-1940s to at least 56 today

There are currently over 230 international organizations, funds, and programs - in addition to NGOs and private philanthropy.

Proliferation of Donors

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Paris Declaration on Aid Effectiveness:

From donor-led to country ownershipDevelopment Results

Managing for Results

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Ownership(Partner countries)

Partners set the

agenda

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Aligning with

partners’ agenda

Using partners’ systems

Alignment(Donors - Partner)

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Harmonization(Donors - Partner)

Establishing common

arrangements

Simplifying

procedures

Sharing information

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Main Areas of Effort in the Paris Agenda Towards Accra

• Improve predictability of aid.• Enhance division of labor among

development partners. • Rely more on country systems.• Increase use of sector-wide approaches.• Progress in untying aid.• More decentralization of decision making.

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Three Key Roles for the Multilateral System

• FinancePrivate flows remain highly concentratedEven well performing countries often face constraints

in mobilizing resources.

• KnowledgeAid alone cannot bridge gaps in knowledge and

capacity that keep countries from applying successful best practices.

• Policy coordination to address global challenges

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Challenges to support and strengthen the role of multilateral

institutions• Financial support to MDBs concessional arms.• Efficiency of MDBs delivery services to better

tailor individual client demand.• Improving coherence, harmonization and

cooperation among multilateral players. • Considering options for strengthening

voice/participation in multilateral institutions.

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Thank you for your attention