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Czech Republic aid reform paves way for more flexible and innovative development

 

18/10/2016 - The Czech Republic has become a more active and transparent development provider since overhauling its aid system and joining the OECD Development Assistance Committee (DAC). It should now focus on making sure its funds and expertise are used as effectively as possible, according to a new OECD Review.

 

The first DAC Peer Review of the Czech Republic says that despite its modest resources and limited presence on the ground, the country is proving a pivotal partner in less-developed countries in the Western Balkans and Eastern Europe by drawing on the experience of its own relatively recent transition to democracy and a market economy.

 

The Czech Republic joined the DAC in 2013 and is seeing the positive impact of a major reform of its foreign aid system in 2007. A key challenge now is to set clear priorities. The country’s development budget must manage competing demands from different geographic and thematic areas and the growing importance of official development assistance (ODA) in the government’s response to foreign policy and geo-political concerns such as regional instability and the refugee crisis.

 

The Czech Republic provided total aid of USD 236 million in 2015, up 11.4% in real terms from 2014 and equating to 0.12% of its gross national income (GNI), some way behind its ambition of reaching 0.33% by 2030. Of that, USD 71 million was for bilateral aid and the rest was multilateral; managed primarily by the European Union but also by the United Nations and development banks. 

 

“The Czech Republic is proving to be an active and valued member of the DAC, bringing lessons from its own transformation, actively helping other countries to become stable free-market democracies and  advocating for Sustainable Development Goal 16 for peace, justice and effective institutions,” said DAC Chair Charlotte Petri Gornitzka. “To be as effective as possible on the ground, it is key to ensure a relatively small budget is not stretched too thinly between different projects and that there is the flexibility to respond to different partners’ needs.”

 

A new plan to focus bilateral ODA on only six countries and on themes where the Czech Republic can add most value is a move in the right direction, the Review says. Aid will in future focus on three least-developed countries – Cambodia, Ethiopia and Zambia – and three Eastern European countries, Bosnia and Herzegovina, Georgia and Moldova. More could now be done to improve the mix of instruments for delivering aid to partner countries and engage the Czech private sector as an investor in sustainable development.

 

The Review said that since joining the DAC the Czech Republic has made significant progress in reporting its ODA flows according to DAC rules and in sharing its forward-spending plans, improving both transparency and predictability.

 

Humanitarian aid made up 10% of Czech bilateral aid in 2013‑14. While the amount of aid used for hosting refugees fell slightly in 2013-14, the share of bilateral ODA it represented reached 18%, up from an average of 14% in 2008-12 due to the fall in bilateral aid.

 

Each DAC member is reviewed every five years in order to monitor its performance, hold it accountable for past commitments and recommend improvements. Reviews use input from officials in the country concerned and a partner country – Moldova for this Review – as well as civil society and the private sector. Read more on DAC Peer Reviews.

 

An embeddable version of the report is available, with information about downloadable and print versions and an interactive data visualisation of the Czech Republic’s aid versus other donors. For further information, or to speak to the report’s author, journalists are invited to contact Elvira Berrueta-Imaz in the OECD Media Office (+33 1 45 24 97 00).

 

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