Development finance statistics

Methodological note on tracking development co-operation through international institutions in DAC statistics

 

To obtain a complete picture of flows reaching developing countries (also referred to as recipient receipts), information on provider countries’ bilateral activities needs to be supplemented with outflow data from multilateral organisations and other organisations. Bilateral providers of development co-operation report core contributions to multilateral organisations as “unallocated” by recipient and by sector, because the funds are pooled and the provider therefore does not know the final destination of its funds. This is one of the main reasons why Development Assistance Committe (DAC) statistics include outflow data from the main multilateral organisations. Earmarked funds channelled through multilateral agencies are, however, reported by countries specifying the geographical and sector allocation. Therefore multilateral agencies are only requested to include outflows from their core budget to the OECD.

Reporting on core contributions to international non-governmental organisations (INGOs), public-private partnerships (PPPs) and trust funds (TFs) usually contains little or no detail on the geographical and sectoral focus of the funds, as the funds are pooled before allocation decisions are taken by (the governing boards of) the relevant institutions. To present a comprehensive picture of recipient receipts, outflows from the most significant of these institutions would need to be captured as well. This is something the OECD is now starting to work on.

But counting the same flows twice in DAC statistics needs to be avoided. When calculating recipient receipts (see figure below), it is the data on multilateral outflows [D] and outflows from INGOs, PPPs and trust funds [F] that are relevant and are added to bilateral Official Development Assistance (ODA) [A and B], and not core contributions to multilateral organisations (or multilateral ODA, C) and to INGOs, PPPs and trust funds [E]. In this way, it is possible to obtain a more complete picture of the flows partner countries receive without counting the same funds [C and E] and [D and F] twice.

 tracking donor flows through multilateral agencies

Provider effort = A + B + C + E
Recipient receipts = A + B + D + F

 

In 2012, 41% of total ODA was channelled through multilateral organisations both through earmarked and unearmarked (core) contributions. Proposals for improved monitoring and presentation of development financing channelled through multilateral agencies and trust funds were presented in September 2014.