Financing Development In Palestine

An Overview: Types of Aid: Budget Support Humanitarian Aid Relevant points: Aid trends' changes (e.g. 2006) Development down from 1/3 to 10%, while Humanitarian and Budget Support increased, for example, that of Budget Support (via TIM, ESSP, and support from Arab countries) increased from 1/3 to 70% First obstacle – aid in Palestine is POLITICAL and is NOT solely based on Palestinian needs! Types of Aid: Budget Support Humanitarian Aid Development Aid

On The Road To Recovery “Palestine In The Driver Seat” EFFECTIVE PLANNING THE PALESTINIAN REFORM AND DEVELOPMENT PLAN PRDP

The PRDP: The PRDP is a comprehensive plan and budget for Palestinian reform and development. The PRDP initiative represents a major reform in its own right. Indeed it is one of the most significant institutional reforms ever implemented by the PNA. It is a vitally important step towards building effective policy-making, planning and budgeting grounded in the local context. Most importantly, it reflects the PNA’s commitment to Palestinian ownership of, and accountability for, the reform and development agenda.

PRDP – A Planning Tool In reality: Programs under each sector Projects PRDP STRUCURE: Economic Governance Infrastructure Social In reality: Programs under each sector Projects Prioritization Second obstacle: Donor assistance pledged for the recurrent budget falls short of the PRDP’s needs

Aid Coordination Structure in the oPt Status April 2008 Economic Strategy Group (ESG) Co-Chairs: Ministry of Finance / World Bank Governance Strategy Group (GSG) Co-Chairs: Ministry of Planning / EC Members: Palestinian Authority: MoP, MNE, MoA, PMA, OoP Donors: EC, France, Germany, IMF, Netherlands, Norway, OQR*, Spain, UK, USA Members: Palestinian Authority: PMO, MoF, MoI, MoJ Donors: Canada, Germany, Italy, Japan, OQR*, Netherlands, Norway, UK, USA, World Bank Local Development Forum (LDF) Co-Chairs: Ministry of Planning, Norway, World Bank, UNSCO Elections2 Judiciary Security Private Sector Dev. & Trade Fiscal Agriculture Public Administration & Civil Service Task Force on Project Implementation (TFPI)1 Secretariat: LACS EC, World Bank, USAID, UNSCO Local Aid Coordination Secretariat (LACS) Infrastructure Strategy Group (ISG) Co-Chairs: Ministry of Public Works & Housing / USAID Social Development & Humanitarian Assistance Strategy Group (SHSG) Co-Chairs: Ministry of Social Affairs / UNSCO Members: Palestinian Authority: MoP*, MoLG, MoT, MoTIT, PWA, EQA, PEA Donors: Belgium, Denmark, EC, France, Germany, Italy, Japan, Norway, Spain, Sweden, UNDP, World Bank Members: Palestinian Authority: MoP, MoEHE, MoH, MoL, MoF Donors: Canada, EC, France, Italy, Japan, Norway, Sweden, Switzerland, USA, OCHA, UNDP, UNRWA, World Bank NGO Representatives: AIDA, PNGO Water & Sanitation Municipal Dev. & Local Gov. Energy2 Health Education Social Protection 6 Sector Working Groups (SWG) © LACS 6

Obstacles & Challenges: Delays in implementation of projects Lack of security in the WB and Gaza strip The political situation in the oPt affects the ability of the PNA to coordinate effectively between the national and the local level, esp. in infrastructure-related projects Hesitation on the part of some donors to engage in large-scale projects Israel has tightened restrictions on movement and access based on security concerns, and settlements in the West Bank have expanded, with attendant risks to economic growth and reforms Unemployment and poverty remain high, especially in Gaza, along with a rise in inflation

Lessons Learned: Continuous communication with Line Ministries and pertinent organisations about their emerging needs via the use of an efficient Aid coordination Structure Emphasis on the definition of a “Pledge” vs. “commitment” Clear distinction between “disbursements” & “commitments” Large portions of “commitments” go to Technical Assistance, and donor expenditure Prioritize