The questions posed in this short presentation are ‘How can countries make better use of ODA’? And ‘can ODA also go for much needed sustainable projects?’ With the new set of 17 Sustainable Development Goals we (the world) will have to focus among other things on more on transparency and effectiveness. This artifact specifically made for the World bank Group Financing 4 Development MOOC is for all audiences and the information provided can be applied by many countries and could hopefully make a difference in outcomes.
Displacement, Velocity, Acceleration, and Second Derivatives
How can countries make better use of ODA
1. How can countries make
better use of ODA ?
(Official Development
Assistance)
Can ODA also go for much needed sustainable projects?
Financing 4 Development MOOC December 2015 J.J. Reyes
2. Introduction:
In 2013 Development aid-flows reached an all-time high, according to the official
data collected by the OECD (Development Assistance Committee).
Net official development assistance (ODA) from DAC members totaled with a
record at USD 135.1 billion in 2013. (http:www.oecd.org). In the years 2014,
2015 and the years to come the aid-flows will continue to go to countries who
need it most. What we also need to take into consideration is that developed
countries will have to consider helping these countries that need the aid most
with aid-flows but also combine it with technical assistance and in return ask for
(more) accountability. The questions posed in this short presentation are ‘How can
countries make better use of ODA’? And ‘can ODA also go for much needed
sustainable projects?’ With the new set of 17 Sustainable Development Goals we
(the world) will have to focus more on transparency and effectiveness. This
artifact specifically made for the World bank Group Financing 4 Development
MOOC is for all audiences and the information provided can be applied by many
countries and could hopefully make a difference in outcomes.
3. Case analysis: What can Mexico do better?
Mexico received in 2013 417.8 million US dollars in Official Development Assistance, for a
country that has a population of 120 million may seem like a fair amount compared to
other countries that receive ODA ( Official Development Assistance) running in billions per
year. You may think that an emerging economy country like Mexico, classified as an upper
middle income country by the World bank would have enough systems in place to start
reducing the amount that they are receiving. This is far from the truth, in 2014 the ODA
(Official Developing Assistance) more than doubled. Mexico received in 2014 971.3 million
US dollars in ODA (Official Developing Assistance), the question than is why? and are they
using these funds effectively? Mexico is a country rich in natural resources like oil and
silver and still encounters many challenges and there is a huge inequality in the country.
Then again having the blessing of natural resources only may not guarantee you a
developed and shared prosperity for all, if we take another Latin American country as
Venezuela as example. Most ODA (Official Development Assistance) funds go to fighting
poverty and hunger specifically.
5. Current efforts and situation:
Despite efforts from the government to come up with social programs it is not enough,
still over 58 million people in Mexico live below the poverty line and the government
has defined 11.7 million Mexicans living in extreme poverty and deprivation. There are
three factors that Mexico use to define poverty the proximity to urban centers,
ethnicity, and gender. It is a fact that rural residents have fewer opportunities for
economic diversification and formal employment. Also poverty rates in indigenous
communities are disproportionately high, when compared with non-indigenous
communities. And within the highly patriarchal social structure of indigenous
communities, women have the least power and least access to productive resource.
6. These challenges just barely scratch the surface of the cause of an increasement of the
ODA (Official Development Assistance), it seems that the funds will need to be used more
efficiently and a big country such as Mexico could use technical help as well. Corruption is
big issue in the country and it is being discussed openly, but you don't see much action.
Impunity is still something that is a reality in Mexico, people get away with many things.
The budgets are not centralized and the country may need technical assistance with their
tax reforms. You see in the city many protests going on, clearly the citizens want more
participation and would like more transparency from the government. A strong campaign
and action against corruption and promotion of good governance and transparency could
benefit and try to restore some of the trust of the people and the private sector. Part of
the ODA (Official Development Assistance) should go into more sustainable projects such as
schools in rural areas, special assistance programs with specific targets such as agriculture
projects, capacity building and awareness campaigns. There could be interesting business
opportunities for projects that could have a return depending on the aim, better quality of
life, a profit or both.
Challenges and suggestions:
7. In conclusion/observations:
Countries that receive ODA have to work on national legislations, campaigns
and systems to help benefit most of the Aid-flows.
Technical assistance is needed in combination with ODA to support better
choices when it comes to investments, reforms and projects.
Accountability, transparency and effectiveness have to be key components
when it comes to ODA aid-flows.
There is room for investments in sustainable projects in countries that receive
ODA, the aim could be for better quality of life, profit (gained in an ethical
way) or both! ;)
Education, capacity building and better quality of life should reach the ones
in remote areas. Not only to figuratively give them ‘fish’ but to teach them
how to fish! ODA aid-flows could encourage these types of projects to help
‘break the cycle’ of dependency on aid.
