AID FOR DEVELOPMENT EFFECTIVENESS - Paris Commitments & UN Response - Sarajevo, 2 March 2006 Daša Šilović, UNDP

Financing for Development A CONTINUUM OF POLITICAL COMMTIMENTS Monterrey – political platform/ Rome/Paris – focus on aid effectiveness UN Summit Outcome Document- 2 key components: Financing for development – follow-up to Monterrey and Paris relating to the quality of aid and to increase its impact, concrete, effective and timely action in implementing all agreed commitments on aid effectiveness, with clear monitoring and deadlines …” UN Reform and reform of the ECOSOC

SUMMIT OUTCOME DOCUMENT Implications: Opportunity to demonstrate capacity for MDG achievement and leverage more resources, as well as vice versa (more rigorous scrutiny of aid effectiveness may prejudice allocations Opportunity to position the UN system in the new aid architecture through the Paris process, with focus on capacity development at country level Pressure for rapid progress on UN reform (implication on UN Architecture globally and at country level).

UNDG ACTION PLAN 1. Putting national development plans at the center of UN country programming; 2. strengthening national capacities; 3. increasingly using and strengthening national systems.

UNDP RESPONSE Complements the UNDG Action Plan through: alignment of aid with national priorities ensuring linkages with the PRS(Ps) and MDGs through better aid coordination and management strengthening national systems, policies and processes in this respect.

UNDP RESPONSE Capacity Development: (institutional and expert capacity for aid alignment with national MDG and poverty reduction strategies; aid management to enhance transparency and accountability and corresponding country specific aid management tools; strengthened public finance management systems and an integrated and multi-disciplinary approach to financing for development to maximise internal and external resources, i.e. allocation, alignment and management; enhanced monitoring mechanisms to include developing country specific (independent systems) and support to the OECD DAC WP EFF monitoring process. Facilitation: Strengthening government/civil society dialogue; South/South and peer learning and knowledge sharing processes; partner country participation in the Paris follow-up and international fora; UNDP/UNCT capacity through learning and the creation of a community of practitioners; support to the OECD DAC WP EFF and the monitoring process.

OTHERS: EU RESPONSE Aid effectiveness has emerged as a key item on the EU agenda too, as well as for the current Austrian Presidency. The General Affairs Council conclusions of November 2004, May and November 2005 established an Action Plan of concrete measures with a wide range of issues related to coordination of policies, harmonisation of procedures and complementarity.

Cont. These measures will not be taken in isolation. Europe’s activities will be open to the entire development community, since they form part of the international movement which the EU aims to mobilise. It will place particular emphasis on cooperation with other bilateral development partners and multilateral players such as the United Nations and international financial institutions.

NEXT STEPS FOR UNDP/UNDG Support Baseline Survey roll-out (field testing and actual Survey roll-out (May-September) Focus on country level: The process is as important as the Survey UNDP/UNCT support to Governments in coordination, management and capacity development (e.g. absorptive capacity/Bulgaria example) UN reform and country level implications – the role of the RC/UNCT

CHALLENGES It remains to be seen how effective PD (review 2008) will be/some challenges : Alignment (with what? Is the CDF appropriate) Institutional capacity (absorptive capacity, procurement, PFM, PIUs…) Donor field behaviour – HQ/field coordination Cross-cutting issues e.g. gender Competing interests at country level (among donors, among sectoral ministries, within the UN system) Capacity of all actors Is 2008 too soon?

A WORD OF CAUTION WE SHOULD NOT FORGET FOR WHO AND FOR WHAT ALL THIS IS HAPPENING – THE OBJECTIVES OF MDG BASED PRO-POOR POLICIES PARIS COMMITMENTS SHOULD NOT BE SEEN IN ABSTRACTO AND AS SELF-SERVING