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At the Arab-DAC Dialogue in 2016, Arab countries and institutions and DAC members
set up a joint task force on education. ...
January 2019 • OECD Development Co-operation Directorate
Arab and DAC
providers target
middle-income
countries in Sub-
Sah...
January 2019 • OECD Development Co-operation Directorate
Chart 1. Trends in total ODA to education
2011-16, gross disburse...
January 2019 • OECD Development Co-operation Directorate
DAC members disbursed the lion’s share of concessional developmen...
January 2019 • OECD Development Co-operation Directorate
GEOGRAPHICAL TARGETING OF EDUCATION CONCESSIONAL FINANCING
Lookin...
January 2019 • OECD Development Co-operation Directorate
Importantly, all providers are focusing on fragile contexts.4
The...
January 2019 • OECD Development Co-operation Directorate
Chart 4. ODA by education sub-sectors
2011-16 annual average, gro...
January 2019 • OECD Development Co-operation Directorate
The United Kingdom has an innovative approach, working with the A...
January 2019 • OECD Development Co-operation Directorate
Table 3. Student performance across competencies,
PISA 2015 asses...
January 2019 • OECD Development Co-operation Directorate
Learning assessments like PISA are relatively new sources of data...
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OECD Report - DAC and Non-DAC Concessional Financing for Education

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OECD Report - DAC and Non-DAC Concessional Financing for Education.
Background report - 2019 Arab-DAC Dialogue on Development.

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OECD Report - DAC and Non-DAC Concessional Financing for Education

  1. 1. At the Arab-DAC Dialogue in 2016, Arab countries and institutions and DAC members set up a joint task force on education. Since then, the Islamic Development Bank, Norway and the United Kingdom, with support from the OECD, have been discussing how to accelerate access to quality education in developing countries. The purpose of this note is to understand, using the OECD statistical database, the main volumes and trends in concessional financing for development in the area of education, which complements the analyses performed by other actors, notably the Global Monitoring Report or the Report of the Education Commission. The note also provides information on OECD work in the field of education. The education sector is underfunded, even if ODA to the sector stood at USD 9.7 billion in 2016 with the lion’s share being provided by DAC members  Domestic resources are the principal source of finance for education (90% of the total) in developing countries. In addition, USD 9.7 bn in Concessional Development Resources supported progress towards the Sustainable Development Goals that target education in 2016. However, external funding for education remains insufficient compared to the needs (estimated at USD 39 billion per annum in 2015-2030 by UNESCO).  DAC providers’ ODA to education increased by 12.4% between 2011 and 2016, while ODA from Arab donors concessional finance from Arab institutions to the education sector doubled over this period.  Over 2013-15, private philanthropies’ flows to the education sector in developing countries amounted to over USD 2 billion on average per annum. DAC and non-DAC concessional financing for education These statistics are based on Arab and DAC providers’ reporting to the OECD. Summary statistics for these and other providers of development co-operation and, when available, project-by-project data can be found at: www.oecd.org/dac/financing-sustainable-development and www.oecd.org/dac/stats/non-dac-reporting.htm. The figures presented here exclude scholarships and indirect imputed student costs, as well as the unallocated budget support that could be imputed to education. The flyer also provides a more granular analysis of education- related humanitarian assistance flows. The information regarding philanthropies comes from an OECD survey comprising data from 2013 to 2015.
  2. 2. January 2019 • OECD Development Co-operation Directorate Arab and DAC providers target middle-income countries in Sub- Saharan Africa and fragile states, where the needs are greatest  Arab and DAC members targeted their education Concessional Development Finance to Sub-Saharan Africa. An estimated 43% of DAC providers’ ODA to the education sector disbursed between 2011 and 2016 was directed towards fragile contexts, while Arab providers directed 64% of their ODA over that period.  Over 2011-16, an annual average of USD 444 million was disbursed by all providers towards education-related humanitarian ODA, representing 2.8% of all humanitarian assistance (below the 4% target globally agreed).  Arab countries and institutions and DAC members mainly targeted middle-income countries (70.4% and 43% respectively) in their ODA to education between 2011 and 2016. The OECD’s Programme for International Student Assessment (PISA) is increasingly supporting Arab countries  The OECD Programme for International Student Assessment (PISA) allows governments and educators to identify effective policies that can be adapted to their local contexts. PISA gathers data on learning, essential information to implement the SDGs.  The OECD also has developed PISA for Development, which focuses on making PISA more accessible and relevant to low- and middle-income countries, as well as on enhancing PISA instruments to target average levels of student performance and to building capacity to manage large-scale assessments in those countries. TRENDS IN OFFICIAL DEVELOPMENT ASSISTANCE TO EDUCATION There has been significant progress in the education sector in the world’s poorest countries since the year 2000. Primary school net enrolment in developing countries rose from 83% in 2000 to 91% in 2015. The number of out-of-school children almost halved, from 100 million in 2000 to around 57 million in 2015 – most of these children are still in low and lower middle-income countries. Global literacy rates among youth aged 15-24 rose from 86% in 1990 to 91% in 2015, and the gap between young men and women was reduced. Despite commendable progress in universal access to education, developing countries still account for 95% of out-of-school children. Furthermore, 250 million primary school aged children are not able to read, write or count well enough to meet minimum learning standards.1 1 MDG Monitor (2017), see: www.mdgmonitor.org
  3. 3. January 2019 • OECD Development Co-operation Directorate Chart 1. Trends in total ODA to education 2011-16, gross disbursements and commitments, USD billion, constant 2016 prices The Sustainable Development Goals (SDGs) could usher in a transformative shift in developing countries, as the goals encompass economic, social and environmental dimensions that will promote sustained growth and shared prosperity. Hence, SDG 4 enjoins policy makers to “ensure inclusive and equitable quality education and promote lifelong learning opportunities for all”. One tool to achieve the SDGs is Official Development Assistance (ODA).2 ODA disbursements to the education sector from all providers of development co-operation reached USD 9.7 billion in 2016. UNESCO estimates the needs of the education sector at USD 39 billion per annum in 2015-2030. In other words, there is a substantial funding gap for education.3 Notwithstanding, it is important to mention that according to the Education Commission, external concessional financing represents under 10% of education expenditures in developing countries, while the remaining 90% stems from domestic sources. These resources are on an upward trend thanks to increases in tax revenue but education is not always being prioritised, while education budgets are not reaching those with the greatest need. The household costs of education in developing countries continue to place a disproportionate burden on the poorest who cannot afford to send their children to school. MAIN PROVIDERS OF ODA AND CONCESSIONAL DEVELOPMENT FINANCE TO THE EDUCATION SECTOR This note covers DAC members, as well as 20 bilateral providers that report to the OECD (which are not members of the DAC) and 35 multilateral organisations. Regarding the Arab countries and institutions, the note includes activity-level data from the Arab Fund for Economic and Social Development, Islamic Development Bank and the OPEC Fund for International Development. The OECD also receives activity-level data from the United Arab Emirates (which includes the Abu Dhabi Fund for Development) and Kuwait (including the Kuwait Fund for Arab Economic Development). The note draws on these Arab development finance flows, which inevitably only provides a partial picture of total Arab ODA flows. 2 For a discussion on how effective is education ODA, see Riddell and Niño-Zarazúa (2016), “The effectiveness of foreign aid to education. What can be learned?”, International Journal of Educational Development 48(1): 23-36. 3 UNESCO (2017), Global Education Monitoring Report, Paris: UNESCO. Available online at: http://unesdoc.unesco.org/images/0024/002495/249568e.pdf. See also the report of the Education Commission (2017), The Learning Generation, available at: http://report.educationcommission.org/wp- content/uploads/2016/09/Learning_Generation_Full_Report.pdf The OECD development finance database contains detail of almost 9,000 education- related ODA activities per year. This note focuses on the period 2011-16, a period when ODA to education was stable after hitting record levels in 2010.
  4. 4. January 2019 • OECD Development Co-operation Directorate DAC members disbursed the lion’s share of concessional development finance for education between 2011 and 2016: an annual average of USD 6 billion (73.3% of total education concessional finance). Non-DAC providers disbursed an annual average of USD 127 million between 2011 and 2016 for education, with the Arab bilateral providers (for which information is available) disbursing USD 117 million. Multilateral agencies also provided USD 2.1 billion on average over that period (25.2% of total education ODA), of which Arab multilateral agencies disbursed USD 29.6 million. Bilateral and multilateral Arab providers represented 1.7% of total education ODA. These ODA flows to the education sector represented 9.1% of total sector allocable ODA for DAC members and 4.8% for Arab providers. Table 1 ranks the main providers of concessional finance to the education sector between 2011 and 2016. A number of providers have significantly increased their ODA to education in recent years, notably the UAE, which is a strong advocate of education (416% increase over that time period, see Box 1), Kuwait (141% increase), Estonia (136% increase) and Norway (96%) – although, except for Norway, these providers started from relatively low education ODA levels. Among the Arab providers, the OECD captures data on the United Arab Emirates and Kuwait with important volumes of ODA in education in 2016 (USD 149 million and USD 44 million, respectively). Arab institutions decreased their flows disbursed to the education sector by 44.2% over 2011-16. In 2016, the International Development Association, the United States and the United Kingdom were the top 3 providers of education-related concessional finance, providing over USD 4.1 billion over that period. The OECD also collects data on philanthropic institutions’ spending on education in developing countries for the period 2013-15. During this period, philanthropies provided over USD 2 billion to the education sector, representing 10% of total sector allocable philanthropic flows. The main sub-sectors targeted were education policy and administrative management (26%) and higher education (26%). The main providers were the MasterCard Foundation (USD 301 million), the Vehbi Koç Foundation (USD 165 million) and the IKEA Foundation (USD 142 million) while the main recipients were India (14%) and Turkey (11%). Table 1. Top 10 providers of concessional finance for education 2011-16 average, gross disbursements and commitments, USD billion, constant 2016 prices Provider Amount Share International Development Association 1 254 15% United Kingdom 1 123 14% United States 1 051 13% Germany 665 8% EU Institutions 623 8% Japan 420 5% France 372 4.5% UNRWA 365 4.5% Australia 335 4% Norway 250 3% Total 6 460 79% Box 2: The Global Partnership for Education (GPE) The GPE is a global fund and a partnership focused on education in partner countries. The partnership has a unique role to agree standards for education planning and policy-making and to mobilise development financing from public and private providers to support and monitor the implementation of those plans. The GPE has recently launched its 2020 replenishment effort and taken steps to be better reflected in the OECD Creditor Reporting System. Over 2014-2017, the GPE channelled USD 2 billion of the total education ODA for that period. Box 1: The United Arab Emirates Policy for Foreign Assistance (2017-2021) The UAE’s foreign assistance policy aims to contribute to global efforts to achieve the SDGs, notably towards achieving SDG Goal 4 on education. For example, the UAE will support education of civil servants from developing countries or will support executive education courses for women in developing countries.
  5. 5. January 2019 • OECD Development Co-operation Directorate GEOGRAPHICAL TARGETING OF EDUCATION CONCESSIONAL FINANCING Looking at all concessional finance flows to the education sector between 2011 and 2016, providers targeted regions most in need: Sub-Saharan Africa received 27% of total ODA to the sector, while South and Central Asia received 24%. The poorest countries (least-developed and other low-income countries) received 36%. Focusing on DAC members, excluding the flows to ‘unspecified developing countries’ (18% over 2011-16), they targeted Sub-Saharan Africa (33% over 2011-16) followed by South and Central Asia (22% over 2011-16). Their main recipients were Afghanistan, Pakistan, Ethiopia, Indonesia and Bangladesh. The top ten recipient countries represented 36% of total financing to the sector (see Chart 2 and Table 2). If we look at Arab providers, they targeted Sub-Saharan Africa (31%, increasing over time), the Middle East (27%) and North Africa (22.5%). Egypt, China, the West Bank and Gaza Strip, Pakistan and Jordan were their main partners. Chart 2. All donors regional allocation of education ODA 2011-16 annual average, gross disbursements Note: Percentages next to country labels represent shares of total education ODA to all developing countries. Table 2. All donors’ top 10 recipients of education ODA 2011-16 annual average, gross disbursements, USD million Partner Amount Share Pakistan 488 5.8% India 438 5.2% Bangladesh 410 4.9% Ethiopia 316 3.8% West Bank and Gaza Strip 311 3.7% Afghanistan 301 3.6% Jordan 225 2.7% Indonesia 214 2.5% Viet Nam 169 2% Morocco 150 1.8% Total 3 025 35.9% The Middle East and North African (MENA) region received an annual average of USD 1.2 billion between 2011 and 2016 for the education sector, of which 29.5% was provided by the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA), 14.7% by the European Union and 12% by the United States. Arab countries and institutions disbursed 5.3 of total concessional finance flows going to the education sector in the MENA region – well above their relative contribution to the sector in all regions. Their main partners were Egypt (14% of total education ODA from Arab providers), the West Bank and Gaza Strip (10%), Jordan (9%) and Morocco (5%). These flows mostly financed basic education (55%).
  6. 6. January 2019 • OECD Development Co-operation Directorate Importantly, all providers are focusing on fragile contexts.4 The share of education ODA flows targeting these contexts was stable over 2011-16 (42.8% of total education ODA, while for Arab providers this figure represented 64%). Beyond developing skills, education can accelerate development in fragile contexts; so increased attention is needed to education and fragility issues.5 Further research could explore the issue of how education ODA is distributed, more generally, across countries and regions (e.g. looking at how the proportion of out-of-school children living in each region is related to ODA distribution). Chart 3. Income group breakdown of education ODA 2011-16 annual average, gross disbursements DAC members Arab providers Note: The “unspecified” category is used when the country targeted cannot be identified. Most Arab and DAC education-related activities focus on middle-income countries (MICs), which received 70% of total Arab ODA flows (USD 103 million, mainly to lower middle-income countries, with USD 66 million) and 43% of DAC ODA flows (USD 2.7 billion). Low-income and least-developed countries (LICs and LDCs) received 34% of education ODA from DAC members and 29% from Arab countries and institutions, on average over 2011-16. Education ODA is essential in least-developed and low- income countries where ODA can contribute to educational development.6 EDUCATION SUB-SECTORS TARGETED BY ARAB AND DAC ODA For DAC providers, basic education accounts for 38% of total education ODA over 2011-16, while it only accounts for 7% of education-related ODA of Arab providers. ODA investments in basic education increased by 30% over 2011-16 in DAC members (while the share in total education ODA increased over that period surpassing the amounts of 2011). ODA investments to basic education increased by 142% among Arab providers over that period (with their share in total education ODA remaining stable). Support to secondary education increased in DAC providers over 2011-16 by almost a factor of two, while decreased by 32% among Arab providers. 4 According to the latest OECD States of Fragility Report (2018), fragile states include the following countries: Afghanistan, Angola, Bangladesh, Burkina Faso, Burundi, Cameroon, Central African Republic, Chad, Comoros, Congo, Cote d’Ivoire, Democratic People’s Republic of Korea, Democratic Republic of the Congo, Djibouti, Egypt, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guatemala, Guinea, Guinea-Bissau, Haiti, Honduras, Iran, Iraq, Kenya, Lao People’s Democratic Republic, Liberia, Libya, Madagascar, Malawi, Mali, Mauritania, Mozambique, Myanmar, Nepal, Niger, Nigeria, Pakistan, State of Palestine, Papua New Guinea, Rwanda, Sierra Leone, Solomon Islands, Somalia, South Sudan, Sudan, Swaziland, Syrian Arab Republic, Tajikistan, Tanzania, Timor-Leste, Uganda, Venezuela, Yemen, Zambia, and Zimbabwe. 5 Global Partnership for Education (2016), “GPE’s work in countries affected by fragility and conflict”, GPE Policy Brief September 2016, Washington D.C.: GPE. 6 See, for example, Riddell and Niño-Zarazúa (2016), “The effectiveness of foreign aid to education. What can be learned?”, International Journal of Educational Development 48(1): 23-36; or Heyneman and Lee (2016), “International organizations and the future of education assistance”, International Journal of Educational Development 48(1): 9-22.
  7. 7. January 2019 • OECD Development Co-operation Directorate Chart 4. ODA by education sub-sectors 2011-16 annual average, gross disbursements, constant 2016 prices DAC members Arab countries and institutions Note: Unspecified is used when the targeted level of education (primary, secondary, post-secondary) is not specified by the provider. An estimated 63% of Arab education ODA over 2011-2016 went to education in general (education, level unspecified). This external assistance is primarily funding education facilities and training (48%). Between 2011 and 2016, an annual average of USD 444 million was disbursed by all providers towards education-related humanitarian development finance (see Box 4 for a methodological overview), mainly by the Asian Development Bank (34%), Canada (29%) and Germany (17%). This suggests that education humanitarian ODA reached 2.8% of total humanitarian aid, below the globally agreed target of 4% (taking the average gross disbursements of humanitarian aid of USD 15.7 billion over 2011-16). Arab providers disbursed an annual average of USD 9.3 million in education-related humanitarian development finance between 2011 and 2016. This humanitarian ODA mainly targeted Iraq, the Syrian Arab Republic and Lebanon in 2016. Box 5 provides an example of how Arab and DAC providers collaborate to support refugees in partner countries. Box 3. The ‘Madrasati’ Initiative An example of triangular co-operation that involves Arab and DAC providers is the ‘Madrasati initiative’ that the German Open Regional Fund finances under the Queen Rania Jordan River Foundation with the OPEC Fund for International Development (OFID). The initiative is a response to the Syrian refugee crisis and the challenges this crisis poses for Jordan. The aim is to improve the learning environment and quality of teaching in schools with a high share of Syrian refugee children and to facilitate the integration of refugees into host communities. In a closely co-ordinated approach, OFID funds the renovation of eight school buildings, which are especially used by Syrian refugees, while Germany funds trainings for teachers and extracurricular activities for Jordanian and Syrian students in the same schools. Box 4. Methodology for estimating humanitarian education-related ODA Data shown in this flyer cover development co-operation in the education sector. The definition of ODA to education excludes humanitarian aid. Humanitarian aid can be delivered directly by a provider or channelled through a multilateral organisation; and can include various activities, including education-related ones, provided they are a humanitarian intervention. To calculate education-related humanitarian aid, we identified education-related projects within the total humanitarian activities through a key-word search using the words “educat-”, “learn-”, “teach-” and “school-”.
  8. 8. January 2019 • OECD Development Co-operation Directorate The United Kingdom has an innovative approach, working with the AGFUND and the UK’s Open University to MAIN MODALITIES AND FINANCIAL INSTRUMENTS USED Between 2011 and 2016, Arab and DAC providers respectively extended 93% and 52% of their flows to education in the form of projects excluding scholarships. The other modalities of DAC providers’ ODA were the following.  19% through experts and other technical assistance;  15% through pooled contributions to specific purpose programmes managed by international organisations;  4% through core support to NGOs and other private bodies;  3% through pooled contributions to basket funds; and  7% was allocated through sector budget support.7 The variety of modalities used by DAC members to deliver their education ODA and the relative concentration of Arab providers on projects, makes both sets of providers complementary and raises the question of which modalities are better placed to deliver education ODA. Both Arab and DAC providers also implement triangular co-operation projects to deliver their education-related ODA (see Box 3 on the ‘Madrasati Initiative’). Grants were the instrument mostly used by both DAC and Arab providers in their education ODA, accounting for 97% of total DAC and 65% of Arab ODA disbursements over 2011-16. THE OECD’S PROGRAMME FOR INTERNATIONAL STUDENT ASSESSMENT The OECD’s Programme for International Student Assessment (PISA) helps compare over 80 country school systems and evaluate their capacity to prepare young people for life and work since 2000. This international assessment of the knowledge and skills of 15-year-old students is conducted every three years. Some partner countries from the Middle East and North Africa also participate in the PISA framework, namely Algeria, Jordan, Lebanon, Morocco and Tunisia (Table 3 provides further information on student performance from these countries and Box 6 provides further insights into the assessment for the case of Morrocco). As seen, these are some of the main partner countries of the Arab providers of development co-operation. Box 6. Education in Morocco, 2018 assessment Morocco has strongly enlarged access to schooling over the past two decades, especially in rural areas, and assured quasi-universal access to primary education. Nevertheless, ameliorating the educational outcomes of all young Moroccans –by ensuring access to high quality teaching and learning until the completion of secondary education- remains a challenge. A majority of students leave school without completing upper secondary education and without the basic skills required to contribute effectively to society and the economy. Maghnouj, S., et al. (2018), Examens de l'OCDE du cadre d'évaluation de l'éducation : Maroc, OECD Publishing. 7 Tertiary scholarships and in-donor education costs of DAC members represented USD 2.6 billion on average over 2011-16. These amounts are excluded from this statistical flyer. Box 5. Supporting education for refugees The United Kingdom has an innovative approach, working with the AGFUND and the UK’s Open University to provide distance learning in refugee camps in various countries in the MENA region. AGFUND finances scholarships, giving priority to female refugees, to give them access to higher education from a well-known and internationally recognised institution while they are in a situation of uncertainty in refugee camps. The Open University provides the education facilities and learning materials. A first batch of women has graduated and has found jobs that match their newly acquired expertise.
  9. 9. January 2019 • OECD Development Co-operation Directorate Table 3. Student performance across competencies, PISA 2015 assessment results Country Science literacy Mathematics Reading Algeria 376 360 350 Jordan 409 380 408 Lebanon 386 396 347 Tunisia 386 367 361 MENA average 411 400 397 OECD average 493 490 493 Source: OECD Education GPS – Available at: http://gpseducation.oecd.org/Home Note: MENA average includes Algeria, Jordan, Qatar, UAE, Israel, Lebanon and Tunisia. Morocco results will be available in 2019 and Egypt will participate in 2021. In order to cater a larger and more diverse set of countries, including low- and middle-income countries, the OECD launched the PISA for Development Initiative in 2013. The initiative aims at better supporting evidence-based policy-making in these countries, while monitoring international educational targets in the Education 2030 framework, developed within the UN’s thematic consultations. In order to monitor SDG 4 adequately and effectively it is necessary to spend USD 280 million per year. This figure is based on estimates of the costs of strengthening and maintaining education management information systems in all countries, that include other data sources in addition to those based on administrative records, and ensuring global coverage in surveys. These other data sources include multipurpose school and household surveys, learning assessments and community level data that could serve, if efficiently assembled, reporting on multiple indicators. Currently, it is estimated that the amount spent on SDG 4 monitoring is USD 148 million per year and the majority of this is used to support monitoring in upper middle- and high-income countries. To meet the shortfall of USD 132 million per year it will be necessary to increase the domestic and external resources allocated to SDG 4 monitoring. We estimate that external financing (aid) to low- income and lower-middle-income countries for the purpose of SDG 4 monitoring will need to increase by up to USD 60 million per year through 2030 compared to current levels. It will also be necessary for all countries to increase their domestic expenditures on SDG 4 monitoring by one third.
  10. 10. January 2019 • OECD Development Co-operation Directorate Learning assessments like PISA are relatively new sources of data that will be the focus of a significant part of the additional funding for monitoring. In light of the rapid growth of international, regional and national assessments in the last two decades, countries have several options to choose from in order to monitor the learning outcome related indicators of SDG 4 and develop their capacity. However, inadequate financing remains a significant hurdle to participation in cross- national or carrying out national assessments for many low- and middle-income countries. If additional resources (domestic and external) are not mobilised quickly for this purpose, opportunities for advancing the monitoring of learning and driving quality improvements will be lost. Capacity development is required for many low- and middle-income income countries to strengthen education management information systems, expand coverage of data and to improve the quality of data including the necessary support to global and regional coordination and monitoring. ternationally recognised institution while they are in a situation of uncertainty in refugee camps. The Open University provides the education facilities and learning materials. A first batch of women has graduated and has found jobs that match their newly acquired expertise. This note was prepared by Juan Casado-Asensio, Néstor Pelechà Aigües and Marisa Berbegal Ibañez, with inputs from Ana Fernandes, Nadine Piefer, Michael Ward and Soumaya Maghnouj, as well as colleagues from the GPE, Islamic Development Bank, Norway and the United Kingdom. For further information contact: juan.casadoasensio@oecd.org

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