Article: Multilateral donor system

Question 1

What is the article about?

Answer 1

efficiency of aid delivery by multilateral donors, and how to potentially improve it.

• global governance builds on several pillars,
• important pillar: multilateral aid architecture describes institutions and instruments to support global development, and the supply of global public goods.

Question 2

global debate on the need to reform the multilateral aid architecture was caused by:

Answer 2

• The rise of emerging donors
• The creation of vertical funds to finance global health and other global commons
• The growing role of non-governmental organisations and the increased presence of private philanthropy

Question 3

global governance reform perspectives

Answer 3

Representativeness: need to restore representativeness to the system to reflect the shift in economic and political clout toward the emerging countries.

Inclusiveness: global governance fails to be broadly inclusive, even after the shift in global governance from the G8 to the G20 (during financial crisis)

Efficiency of aid delivery: which has been emphasised in the Paris Declaration, was noted that excessive fragmentation of aid at the global, country or sector level impairs aid effectiveness. Needed measures for concentration and fragmentation and options for tackling excessive fragmentation.

the article suggests: in order to promote accountability, it is proposed to assigning UN Millennium Development Goals to multilateral agencies together with a specialisation among them, along the lines of the Tinbergen rule.

Question 4

Multilateral organisations -critique

Answer 4

international development-finance system has become highly complex. This “non-system” does not result from coherent design, but is a child of spontaneous disaster. T_oo many multilateral organisations, with overlapping mandates, complex funding arrangements and conflicting requirements for accounting and reporting, seem at odds with the aid effectiveness agenda._

Question 5

Tinbergen rule

Answer 5

the number of achievable policy goals cannot exceed the number of. policy instruments

Question 6

preconditions for the multilateral system to deliver aid effectively

Answer 6

multilateral donor non-system requires mapping: Such mapping identifies overlaps—leading to reduction of multilateral remit or proposals for consolidation; reduction of rivalries - leading to clarification of roles; and absences of co-ordination—leading to the design and implementation of co-ordinating structure.

→identifying of areas for consolidation, to address fragmentation and poor co-ordination at country level, and help to identify comparative advantages for institutional role assignments among multilateral agencies

Question 7

Helmut Findings:

Answer 7

His mapping demonstrates a large number of multilateral organizations, financial institutes, and other agencies, and how these institutions overlap, for instance the multilateral duplication and overlap in serving the MDGs is striking, costly, and inefficient.

Question 8

explanations for the rising multilateral donor “proliferation” / or the growth in multilateral donors.

Answer 8

2 types:

1. Normative explanations: need to supply global public goods, and for, climate change, food, water, global health problems, terrorism, the global economic order and so forth.
2. Positive political economy explains, the growth of international organizations without justifying it. The growth of international organizations can be attributed to the self-interested utility-maximizing behaviour of rational politicians and civil servants, including international bureaucrats who have a vested interest in the expansion of their organization.

Question 9

Conclusion: Towards Accountability and Efficient Assignment.

Answer 9

multilateral development finance has become too complex for both donor budgets and recipient’s administrations.

The proliferation of donors on the group entails high transaction costs for all recipient countries.

Recipient-country administrations suffer from this complex system, overburdened by the number of debaters.

Donor fragmentation also leads to an erosion of bureaucratic quality. Competition among multilateral aid donors is not a solution for the supply and delivery of aid.

steps to make progress toward a more accountable and efficient system of multilateral aid:

1. A prerequisite for effective ownership and efficient aid delivery, at the core of the Paris Declaration on Aid Effectiveness, is to map the rising complexity of multilateral development finance, to help identify areas for consolidation, address fragmentation and poor co-ordination at country level, and help identify comparative advantages for institutional role assignments among multilateral agencies.
2. To developing quantitative and qualitative measures of multilaterals’ contributions would be a useful step in promoting accountability. This would provide a basis to specialise multilateral agencies in line with the Tinbergen Rule along the MDGs.
3. However, staff selection, monitoring, procedural checks, and incentive-compatible contracts with managers of multilateral donors, remain important systems toward less redundancy and more concentration in aid delivery.