Members of Development Assistance Committee, the world’s major donor countries, and other donors, have adopted an Action Plan to support poor countries trying to cope with the economic and financial crisis.
Globally, aid has risen and most donors are so far holding to their promises in the face of the crisis. In fact, participants to the meeting welcomed the announcement by the Obama administration of its proposal to double its foreign assistance over the next five years. But, despite this trend, some DAC members have decreased their aid and others are unlikely to meet their commitments. Only renewed efforts will bring the collective aid performance back on track, especially for Africa. As the major international institutions respond quickly to emerging needs with the funds they have available, there is a risk that this money will soon run out. The action plan calls on the DAC donor community to ensure that these institutions can count on the financial support they need to backstop developing countries over the medium term.
The global downturn is affecting developing countries - the least responsible for the crisis, and the least able to cope with its impact. Low-income countries, in particular, were already weakened by the food and energy crises. The stakes are now high: The World Bank estimates that, as a result of the crisis, 53 million more people will have to live on less than USD 1.25 a day. Eckhard Deutscher, Chair of the Development Assistance Committee, warns “We must not allow the current crisis to push millions of people back into poverty, reversing the progress for which developing countries have worked so hard”.
Open trade, investment support and private sector development are critical to the development of poor countries. Yet they also need aid to mitigate short-term pressures and move towards strong, clean and fair growth. The Development Cooperation Minister of Luxembourg, Jean-Louis Schiltz, emphasizes, “Predictable financing for development is key. Above and beyond aid, we must use all available policy options to ensure that developing countries come through the crisis and continue progress towards their development goals.”
In the action plan, Members of the Development Assistance Committee agree to assist developing countries by:
meeting their existing aid commitments, in particular in Africa.
helping low-income countries finance both short- and long-term priorities.
making the most effective possible use of aid.
financing international institutions in a timely and predictable manner .
tackling the crisis using all instruments available, not just official aid.
For further information, journalists are invited to contact Helen Fisher at the OECD's Media Division (tel. +33 (0) 1 45 24 80 97).
Action Plan to support poor countries trying to cope with the economic and financial crisis