1. Bilateral Aid Agencies in Poverty Reduction Dr. muhammad G. Sarwar Sarwar_mg@ yahoo.com Civil Service College, Dhaka 10 July 2011 1

2. Presentation Contents Foreign Aid Flow in to Bangladesh: trend analysis Dominant Players in Development Assistance in Bangladesh: the gang of four Bilateral Donors – JICA – DFID / UK Aid – US AID – Pros and Cons of Bilateral Assistance 2

3. Periodic Flow of Foreign Aid 1972-2010 (in billion US$) FYFood AidCommodity Aid Project AidTotal AidAverage Yearly Aid 1971-19802.0902.7681.7496.607660 1981-19902.3464.4357.34014.1211.412 1991-20001.5373.16910.91115.6171.562 2001-201061353615.10416.2531.625 Total6.58610.90835.10452.5981.315 % share122167100 3

4. Periodic Flow of Foreign Aid 1972-2010 (in billion US$) 4

5. Types of Foreign Aid 1972 -2010 (in %) 5

6. Ten largest Donors in Bangladesh FY 1972-2010 (in million US$) SL DonorsGrantLoanTotalShare (%) 1 World Bank269116641193322.69 2 Asian Development Bank 708114818415.56 3 Japan 33083753706113.42 4 USA 2,7877633,5506.75 5 UN System (except UNICEF) 27442027645.25 6 Canada 20871621034.00 7 UK 19738920623.92 8 Germany 143626817043.24 9 European Union15344815823.01 10 Netherlands1,078711,1492.18 6

7. Ten Largest Donors in Bangladesh 7

8. Ten Largest Bilateral Donors JICA (Japan International Cooperation Agency) DFID / UK AID US AID CIDA (Canadian International Development Agency) GTZ / Germany Netherlands Saudi Arabia SIDA (Swedish International Development Agency) NORAD (Norwegian Agency for Development) DANIDA (Denmark International Development Agency) 8

9. JICA: vision Inclusive and Dynamic Development ‘Inclusive development’ refers to development that encourages all people to recognize the development issues they themselves face, participate in addressing them, and enjoy the fruits of such endeavors. ‘Dynamic development’ refers to the creation of self- reinforcing virtuous cycles of mid to long-term economic growth and poverty reduction in a constantly changing environment where a variety of issues arise simultaneously and get entangled each other. 9

10. JICA: mission Mission 1: Addressing the global agenda Mission 2: Reducing poverty through equitable growth Mission 3: Improving governance Mission 4: Achieving human security 10

11. JICA: strategy Strategy 1: Integrated assistance (three modalities of assistance—technical cooperation, ODA loans, and grant aid to offer comprehensive support) Strategy 2: Seamless assistance (provide assistance in ways that best match the level of development in each recipient nation, taking a long-term perspective and offering seamless assistance to ensure sustainable development into the future) Strategy 3: Promoting development partnerships (promote public-private partnerships, pooling the experience, technologies, and resources of local governments, universities, nongovernmental organizations, and other actors) Strategy 4: Enhancing research and knowledge-sharing (building broad networks of academics from Japan and elsewhere around the world to create new knowledge value in the field of international development assistance) 11

12. JICA: Activity Guiding Principles 1. Achieving synergies of the merger 2. Tackling complex, difficult issues flexibly with the field-based approach 3. Fostering expertise for providing professional solutions 4. Efficient and transparent operations 12

13. Jica in Bangladesh: history 1973: Beginning of Japanese Technical Assistance to Bangladesh by dispatching Japan Overseas Cooperation Volunteers (JOCVs) 1974: The first ODA Loan to Bangladesh; Establishment of JICA Bangladesh Office 1988: Establishment of OECF (antecedent of JBIC) Representative Office in Dhaka 1995: Exceeding 500 billion yen as total commitment of ODA Loans to Bangladesh 2003: Exceeding 1,000 Experts dispatched from Japan; Debt Cancellation (1,58.90 million yen) 2006: Exceeding 5,000 Participants joining trainings in Japan 2008: Merger of JICA and JBIC 2009: Exceeding 1,000 JOCVs dispatched from Japan; 1,190 billion Japanese Yen as a total amount of Japanese ODA 13

14. JICA Activities in Bangladesh Social Development with Human Security – Disaster Management – Water and Sanitation – Health – Education Economic Growth – Transportation – Power and Energy – Agriculture/Rural Development – Private Sector Development Governance 14

15. JICA Commitment and Disbursement (billion US $) CommitmentDisbursementPipeline on 1 st July 2010 Project Aid4.613.031.56 Commodity Aid3.593.640.0 Food Aid0.41 0.0 15

16. JICA Commitment and Disbursement (billion US $) 16

17. Trend of JICA Commitment and Disbursement (million US $) 17

18. Selected JICA Projects Number of Total On-going Projects: 52 JICA on-going Projects on Transportation: – Dhaka Chittagong Railway Development Project (2008 - 2015) Dhaka Chittagong Railway Development Project (2008 - 2015) – Eastern Bangladesh Bridge Improvement Project (2009 - 2012) Eastern Bangladesh Bridge Improvement Project (2009 - 2012) – Chittagong Ring Road Development Project (2010 - 2013) – Bangladesh Digital Mapping Assistance Project (BDMAP) (2009 - 2011) Bangladesh Digital Mapping Assistance Project (BDMAP) (2009 - 2011) – The Project for the Provision of Portable Steel Bridges on Upazila and Union Roads (2005 - ) – The Project for Improvement of Steel Bridges for Roads in Rural Areas (2001 - ) – Dhaka Urban Transport Network Development Study (2009 - 2011) 18

19. DFID / UK AID Bangladesh is branded as a country faces challenges of: – large and increasingly urban population – of natural disasters and climate change – one of the poorest states in the world – most fragile – both physically and politically 19

20. UK AID Top Priorities Encouraging private sector investment Ensuring the government is capable of financing and delivering social services Getting more children into better schools Improving family planning and reducing maternal deaths 20

21. UK AID Commitment and Disbursement (billion US $) CommitmentDisbursementPipeline on 1 st July 2010 Project Aid2.011.560.57 Commodity Aid0.450.440.0 Food Aid0.05 0.0 21

22. UK AID Commitment and Disbursement (billion US $) 22

23. Trend of UK AID Commitment and Disbursement (million US $) 23

24. UK AID in 2009-10 Total UK bilateral aid received (09/10): £148.8 million Current Project Portfolio: 54 Aid by sector: Economic Growth: 28% Education: 25% Governance: 17% Health: 15% Other social services: 11% Other: 3% UK AID will spend an average of £250 million per year in Bangladesh until 2015. 24

25. Selected DFID Projects Health, Nutrition and Population Sector Programme (HNPSP) Primary Education Development Programme 2 (PEDP2) BRAC Challenging the Frontiers of Poverty Reduction - Phase 2 Climate Change Program - Jolobayoo-O-Jibon Chars Livelihoods Program ii Economic Empowerment of the Poorest Urban Partnership for Poverty Reduction English in Action Regulatory and Investment Systems for Enterprise Promoting Financial Services for Poverty Reduction in Bangladesh Strengthening Public Expenditure Management Sanitation, Hygiene, Education & Water Supply in Bangladesh 25

26. US AID Bangladesh Branded Bangladesh as a country of: – most densely populated – poorest countries in the world – a moderate Muslim majority population of 156 million 26

27. US AID Programs Investing In People: Health and Education Humanitarian Assistance: Improving Disaster Response Increasing Economic Growth Governing Justly and Democratically Peace and Security: Combating Human Trafficking 27

28. Examples of US AID Impact in Bangladesh USAID has supported the construction of 507 cyclone shelters that accommodate 507,000 people. USAID reaches out to 20,000 religious and community leaders every year to introduce them to development initiatives. Approximately 20 million Bangladeshis receive basic health care services every year through USAID's health programs. 28

29. Where does USAID's Money Go? Top 10 Benefiting Countries for FY 2010 Afghanistan Pakistan Haiti Israel West Bank/Gaza Kenya Sudan Jordan Ethiopia Georgia 29

30. US AID Program Areas in Bangladesh for FY 2010 Health Education Infrastructure Agriculture Good Governance Soc-Econ Services & Protection for Vulnerable Populations Financial Sector Administration and Oversight Conflict Mitigation and Reconciliation Private Sector Competitiveness Counter-Narcotics 30

31. US AID Program Areas in Bangladesh for FY 2010 (contd.) Environment Civil Society Rule of Law and Human Rights Political Competition and Consensus-Building Economic Opportunity Macroeconomic Foundation for Growth Program Design and Learning Trade and Investment Disaster Readiness Financial Sector Capacity Stabilization Operations and Security Sector Reform Counter-Terrorism 31

32. US AID Commitment and Disbursement (billion US $) CommitmentDisbursementPipeline on 1 st July 2010 Project Aid1.731.130.33 Commodity Aid0.600.610.0 Food Aid1.80 0.0 32

33. US AID Commitment and Disbursement (billion US $) 33

34. Trend of US AID Commitment and Disbursement (million US $) 34

35. Bilateral Donors: a critique Bilateral donor agencies were created by the western imperial countries after the Second World War to keep their former colonies engaged with their economies Bilateral donors are dominated by the few western post- colonial powers to exert their global strategic interest in post colonial world order. Bilateral donors use their assistance to their former colonies to expand their business and political interest. Bilateral donors helps to reduce poverty in the recipient countries to enhance global and regional peace and security which is essential for maintaining existing global order. Aid disbursement by the bilateral donors could be faster then multilateral donors due to simpler decision making procedure. 35

36. Thanks ! 36