Development Assistance Committee High Level Meeting, 22-23 April 2003. Press Statement by the Chairman, Mr. Jean-Claude Faure

23/04/2003- Press Statement by the Chairman, Mr. Jean-Claude Faure.

1.Development Co-operation Ministers and Heads of Aid Agencies met in Paris on 22-23 April 2003 for the Annual High Level Meeting (HLM) of the Development Assistance Committee (DAC).

2.With the international development community decisively embarking on implementing the commitments entered into in Doha, Monterrey and Johannesburg, the 2003 DAC HLM focussed its attention on further progress to improve policies and strategies, practices and performance linked to achieving the Millennium Development Goals (MDGs), in particular through massive poverty reduction. Maintaining this focus is essential at a time of worrying uncertainties in the international economic and political environment.

3.The DAC HLM took note in this respect of the preliminary ODA statistics for 2002 released on 22 April 2003, and welcomed the 5 per cent increase they record, to $57 billion in total net ODA. They confirmed existing commitments which, according to Secretariat calculations, would generate an increase by 2006 of about 30 per cent, or $16 billion in real terms, over 2001 levels. Several participants restated their countries' commitments to further increases in the longer term.

Aid Effectiveness

4.The DAC HLM emphasised the nexus between scaled up volumes of aid and improved aid effectiveness. In such a holistic framework, developing countries' own efforts and better policy coherence in developed countries, would lead to overall development effectiveness reflected in progress on meeting the MDGs. This required an evolution in the behaviour of all donors, bilateral and multilateral alike, to be manifested in strengthened operational partnerships with developing countries aligned around country-led strategies.

5.On harmonising donor practices, the DAC HLM noted with appreciation the landmark "Rome Declaration" adopted by the High Level Forum on Harmonisation on 25 February 2003 and welcomed the Good Practice Papers prepared by the DAC Task Force on Donor Practices in a joint effort between bilateral and multilateral donors and involving developing country partners. Ministers and Heads of Agencies are committed to carry out the necessary changes at headquarters and in the field that are now called for. They confirmed their readiness to review progress on these matters in the DAC Senior Level Meeting (SLM) in December 2004 and in a further High Level Forum with the multilateral development banks and other development actors in early 2005.

6.The DAC HLM supported monitoring and reviewing of development outcomes as a shared basis of collective aid efforts, both bilateral and multilateral. The MDGs provided an outcome-based framework for the whole aid system. And country-led development strategies, such as Poverty Reduction Strategy Papers (PRSP), were confirmed to be the common reference point for aid programming.

7.Aid agencies will therefore strengthen results-based management in the delivery of aid. They will work together towards better donor collective effort for alignment around country-led strategies and towards harmonisation of donor practices, i.e., the reduction of multiple procedural requirements which impose a serious burden on partner countries' limited administrative capacities. The DAC was called upon to provide a common basis for measuring and monitoring progress and for sharing country experience in this regard, while respecting the diversity of individual approaches and regions. The DAC Peer Reviews should be harnessed to the greatest extent possible.

8.The DAC HLM agreed that progress on harmonisation and donors' collective efforts for alignment had to be complemented by further work on: good practice in procurement procedures; strengthened use of results-based management and evaluation; and sustained compliance with the 2001 DAC Recommendation on Untying Aid to Least Developed Countries, while exploring on the scope for a broadening of its application over time.

9.The DAC HLM asked the newly created "DAC Working Party on Aid Effectiveness and Donor Practices" to urgently design and oversee a work programme in all of these areas, including the prospect for a formal DAC Recommendation on the co-ordination and harmonisation of donor practices. The Working Party should comprise senior practitioners from capitals. Multilateral donors, in particular the development banks and the UN Development Group (UNDG), should be associated to its work, and developing countries should be invited as appropriate. The Working Party should report to the DAC SLM in 2003 and present first major products to the DAC High Level and/or Senior Level Meetings in 2004.

Emerging approaches towards shared responsibility, or mutual accountability

10.The DAC HLM confirmed that the Monterrey Consensus, and the necessity to make decisive progress towards achieving the MDGs, called for a shared responsibility for development progress, with two-way commitments that should be subject to ongoing dialogue. Such shared responsibility or "mutual accountability" is recognised as a relevant description of a practical mechanism needed in the relationship between developed and developing countries, through which the latter would show accountability for good governance and good policies, including conflict prevention and resolution, while developed countries would accept responsibility for aid flows and aid effectiveness as well as for greater policy coherence for development. The Cotonou Agreement was cited as an illustration of such partnerships.

11.While mutual accountability requires a demonstrated commitment to development priorities on the part of developing countries, HLM participants stressed that development co operation efforts must also be directed to reversing the trends in failing states or "difficult partnerships". They welcomed the new "learning and advisory partnership" as a means for bilateral and multilateral agencies to work together in this area. They also endorsed a policy statement on "A Development Co operation Lens on Terrorism" and encouraged ongoing DAC work on security sector reform and the political economy of war. They stressed the importance of ensuring policy coherence and greater transparency in extractive industries.

12.The DAC HLM noted the emergence of practical mechanisms for tracking progress and for joint review, both in the UN with the UN Millennium Project and in the Development Committee with the prospect of its monitoring of country policies to achieve the MDGs. They welcomed in this respect the OECD's horizontal programme on policy coherence for development, based on the 2002 MCM Communiqué and on the Statement on "OECD Action for a Shared Development Agenda" it comprised, and called for thorough discussions of its progress, between the DAC and other policy communities in OECD.

13.HLM participants recalled their appreciation, expressed at last year's HLM, that NEPAD provides a basis for implementing the Monterrey Consensus in the African context. They confirmed their support and engagement, in a way that respects African ownership, for the NEPAD principles and, in particular, for the African Peer Review Mechanism (APRM) as endorsed by the NEPAD Heads of States and Government Implementation Committee (HSGIC) in Abuja on 9 March 2003.

14.The DAC HLM noted initial Secretariat interaction with ECA on mutual reviews of development effectiveness between NEPAD and OECD/DAC and benefited from a presentation by ECA's Executive Secretary, Mr. K.Y. Amoako. They also took note of the basic support of the NEPAD HSGIC for further work on an ECA proposal for such mutual reviews.

15.The DAC HLM agreed that further work and reflection was necessary in this field of mutual reviews of development effectiveness. Particular attention should be devoted to the country level and to using existing frameworks, such as the "Strategic Partnership for Africa" (SPA), for review of best practices on governance and aid. At the aggregate level, the DAC had a role to play in drawing conclusions from this experience and defining emerging issues. These could be discussed between the DAC and NEPAD's intended "ODA Forum" and/or at high level gatherings such as the annual ECA "Big Table". HLM participants called for realism and pragmatism in dealing with issues of policy coherence. While these issues would be referred to in the above discussions, they could also be actively addressed in broader consultations between NEPAD and the OECD, bringing inits various policy communities, while keeping in mind that solutions for specific issues would, by nature, be dealt with in specialised institutions, such as the WTO.

Maximising synergies between ODA, private investment and trade, for economic growth and poverty reduction

16.The DAC HLM elaborated on the consensus on the crucial role of economic growth for poverty reduction. The present sluggish growth in the world economy was and could be for sometime to come, a threat to the poor. All avenues, particularly improved coherence between trade and aid policies, had to be pursued to improve the basic preconditions for sustained economic growth in developing countries, both in Low and Middle Income Countries, and to involve the poor in generating growth and benefiting from it. Development of private sector enterprise was central to generating a growth dynamic. HLM participants encouraged the continuation of the "Bologna Process" on fostering small and medium enterprises. Joining in international trade and investment and promoting agricultural productivity and exports linked to rural development was pivotal in connecting the poor to economic growth. The current pace of implementation of the Doha Development Agenda, six months before the next WTO Ministerial Conference in Cancun, led participants to reaffirm these concerns.

17.HLM participants recalled that aid was most effective in countries with good policies in place. They recognised the relevance of OECD's knowledge about governance, the enabling environment for trade and investment and the role of innovation and of new technologies. This knowledge was also important for developing countries and, hence, for aid allocation. In this context, HLM participants welcomed the recent Global Forum on "Integrating ICTs in Development Programmes", organised on 4-5 March by the DAC jointly with World Bank and the UN, and encouraged further interaction with other policy communities in OECD in a two-way street approach to policy coherence for development.

18.At the same time, the DAC HLM stressed the growing need for aid interventions to strengthen the supply-side in developing countries' economies, both to attract investment and to allow the poor to participate in generating growth. In addition to supporting sustainable health and education systems, it was important to help developing countries with capacity building, in particular for investment and trade. Renewed attention had to be devoted to financing and management of public infrastructure in such areas as transport, energy, water and sanitation, involving stakeholders from the private sector in both developing and developed countries. The DAC HLM expressed confidence that this interaction between ODA and private investment, which could serve as a basis for various forms of public-private partnerships, would be taken into due account in the discussion of the OECD Ministerial Council Meeting (MCM) on 29-30 April 2003. As the MCM will touch upon development issues at its working dinner on "Sharing in the Gains: Promoting Growth and Investment in Developing Countries", the DAC HLM asked the DAC Chair to convey to the OECD MCM the relevant conclusions of its discussions.

19.The DAC HLM asked the newly mandated "DAC Network on Poverty Reduction" to design and implement a work programme that would give strong attention to the integration of major growth factors with poverty reduction. Progress and final results should be submitted to the DAC SLM. Some participants also called upon the DAC to further explore the role of government guarantees for private flows as well as tax deductions for private donations.

Iraq

20.HLM participants had an informal exchange of views on the challenges linked to relief, recovery and reconstruction in Iraq . All donors shared the same basic concern to advance the emergence of a self-governed Iraq with a functional economy. As it was essential to integrate urgent humanitarian needs with long-term development objectives, participants agreed on the important role of the UN and expressed interest in an early donor gathering to work towards consensus on objectives and to foster concrete co-ordination and pulling together of approaches between the various international actors. The DAC Expert Meeting on Afghanistan Reconstruction and Recovery on 2-3 May 2002 was recalled in this respect.

Photos of the meeting