uuBuiajM uaSjnf puc }|oqspn anbmojuy |-l uqof g pun siua)sA$ 40 uosuBduio^ y pjV ueadojng /V\OH 00005211 Overseas Development Institute How European Aid Works A Comparison of Management Systems and Effectiveness Aidan Cox John Healey Antonique Koning ^B" >CH Library Overseas Development Institute 0 6. MAR 97 P rtland House Stag Place London SW1E 5DP Tel 017! 39} 1600 ODI Research Study How European Aid Works A Comparison of Management Systems and Effectiveness Aidan Cox John Healey Antonique Koning in collaboration with Paul Hoebink David Naudet Gorm Rye Olsen Lars Udsholt Jiirgen Wiemann Overseas Development Institute A CIP Publication data record may be obtained from the British Library ISBN 0 85003 243 1 © Overseas Development Institute 1997 Published by the Overseas Development Institute, Portland House, Stag Place, London SW1E 5DP All rights reserved. No part of this may be reproduced by any means, nor transmitted, nor stored electronically, without the written permission of the publisher. Printed by The Chameleon Press Ltd, London Contents Acknowledgements vii List of Contributors viii Acronyms ix Charts 1-4: The Structure of EU Donor Organisations xii Introduction 1 Part I A Comparative Assessment of Organisation, Management and Approach in Six Major EU Donor Agencies 1 Comparative Political Structure 6 2 Management of Donor Personnel Compared 18 3 Strategic Objectives, Accountability and Country Programming 30 4 Comparative Project Management 42 5 Comparative Donor Project Effectiveness 61 6 Comparative Policies and Management of Structural 78 Adjustment Assistance 7 EC Co-ordination: Experience and Prospects 95 8 Complementarity: Three Options for Improving EU Aid 107 Effectiveness Part II Six Individual Donors in the European Union 9 The European Commission: EDF Aid Management 124 Antonique Koning 10 Danish Aid Management 149 Gorm Rye Olsen and Lars Udsholt 11 French Development Aid 165 David Naudet 12 German Development Aid 179 Jiirgen Wiemann 13 Netherlands Aid Management 194 Paul Hoebink 14 UK Aid Management 210 John Healey Conclusions 223 References and Select Bibliography 235 Index 241 vi How European Aid Works Tables 1.1 Number and proportion of small programmes in the ACP countries, 1991-3 11 2.1 Personnel and administration in aid agencies, 1991-4 19 2.2 Comparison of personnel in DG VIII and ODA (1993/4) 21 4.1 Project management 51 4.2 Learning and feedback 57 5.1 Summary of indicators of effectiveness of transport projects in Tanzania and Kenya 68 5.2 Donor sectoral effectiveness ranking (1 high to 5 low) by percentage of successful projects for common sectors 76 6.1 Trends in EU donors' programme aid 79 6.2 Donor import assistance and the macroeconomic policies of selected ACP recipient countries ($m) 85 8.1 Scope for rationalisation in 39 ACP Countries with 8-12 small country programmes 109 9.1 Programmable and non-programmable aid to ACP countries, Lome I to IV 131 9.2 Lome IV project implementation process for programmable funds 138 10.1 Danish development administration staff and field missions, 1985-95 156 13.1 Staff levels of the Ministry of Foreign Affairs 202 14.1 ODA staffing, 1994 214 Appendix Tables 8.1 Sectoral and sub-sectoral use of aid 1987-90 ($m) 119 8.2 Comparison of sectoral distribution of Member States' aid 1990-80 (%) 120 8.3 Sectoral distributions of decisions and payments of EDF 6 & 7 122 9.1 Disbursements of EU Aid, 1990-3 (m ecu) 145 9.2 Organogram of the Directorate-General for Development 146 Figures 8.1 Staffing and size of aid programme in EC delegations 110 •Oil Acknowledgements This is a collaborative study between six research institutes: the Centre for Development Research, Copenhagen, (Director: Knud Erik Svendsen); DIAL, Paris, (Director: Jacques Loup); the European Centre for Development Policy and Management, Maastricht, (Director; Louk Box); the German Development Institute, Berlin, (Director: Hans-Helmut Taake); the Overseas Development Institute, London, (Director: John Howell); and the Third World Centre, Catholic University of Nijmegen. Each institute was responsible for funding its own contribution. ODI and ECDPM took the lead in the co-ordination of the project and organised a workshop in Maastricht, 11-12 May 1995, at which donor officials and research collaborators discussed the preliminary research papers and the issues arising from them. The record of this workshop has been drawn on in writing this book. The authors would like to acknowledge the contribution of Adrian Hewitt, of the Overseas Development Institute, who conceived the idea of this comparative study and established relations with the collaborating institutes. Tony Killick made helpful suggestions on content and presentation. They are also grateful to the Directors of the Institutes for their co-operation and help, and to those officials from the six donor agencies who spared time to attend the workshop and contribute so constructively. The authors of Part I would like to thank Geert Laporte of ECDPM for assistance with Chapters 7 and 8. Special thanks are due to the DAC Secretariat of the OECD for their advice, documentation and the statistical work undertaken specially for the project, as well as for attending the workshop. Each author of the six donor studies is appreciative of the assistance provided by the staff of the donor agencies and the European Commission through interviews and documentation. Thanks are due to Brigitte Bessems and Suzanne Cartigny at ECDPM for their hospitable and efficient organisation of the workshop, to Graham Hurford and Christopher Pescud in the ODI library for help with documentation, and to Margaret Cornell of the ODI for editing the book and preparing the index. The British Overseas Development Administration (ESCOR) provided a grant to the Overseas Development Institute for its research contribution and co-ordination role in this project and also a grant to assist with the publication costs of this book. The Overseas Development Administration provides funds for economic and social research to inform development policy and practice. The views and opinions expressed in this study do not necessarily reflect ODA's official policies or practices but are those of the authors alone. Vlll List of Contributors Aidan Cox is a Research Fellow of the Overseas Development Institute, London, specialising in European aid policies and effectiveness. John Healey is an Associate of the Overseas Development Institute, London, specialising in aid policy and management and the politics of economic policy. Paul Hoebink is senior lecturer at the Third World Centre of the Catholic University of Nijmegen, The Netherlands. His research is mainly on aid policy, aid evaluation and aid effectiveness of both private and bilateral and multilateral donors. Antonique Koning is a Research Fellow who has a joint appointment with the Overseas Development Institute, London and the European Centre for Development Policy Management, Maastricht. She specialises in EU development and external trade policies. David Naudet is a researcher of the Scientific Interest Group DIAL, Paris, working on applied macroeconomics and aid analysis. Gorm Rye Olsen is at present research director (acting) at the Centre for Development Research, Copenhagen. His current research project deals with 'Western European aid to sub-Saharan Africa in the post-Cold War era'. Lars Udsholt is a researcher with the Centre for Development Research, Copenhagen, working on aid relations and poverty reduction in Africa and specialising in the role of the World Bank. Jiirgen Wiemann is head of the European trade and development co­ operation department of the German Development Institute, Berlin, specialising in aid policies, international trade, and trade and the environment. IX List of Acronyms ACP African, Caribbean and Pacific AIDS Auto Immune Deficiency Syndrome ALA Asia and Latin America ATP Aid and Trade Provision AWZ Ausschufi fur Wirtschaftliche Zusammenarbeit BMZ Federal Ministry of Economic Development Cooperation, Germany BPS British Partnership Schemes CAR Central African Republic CDA/PvdA Center Democrarisch Appel /Partij van de Arbeid (Dutch Labour Party) CDA Center Democrarisch Appel (Dutch Christian Democrats) CDC Commonwealth Development Corporation, UK CDG German Training Institute for Developing Country Personnel CDI Centre for the Development of Industry CDR Centre for Development Research, Copenhagen CDU Christlich Demokratische Union (German Christian Democratic Union) CEEC Central and East European Countries CeSPI Centro Studidi Political Internazionale CEU Countries of the European Union CFA Communaute Financiere Africaine CFD Caisse Francaise de Developpement (French Development Fund) COP Comite d'Orientation et de Programmation CTA Technical Centre for Agricultural Research D-test Screening Test for Project Proposals (Netherlands) DAAD Deutsche Akademische Austausch Dienst (German Academic Exchange Service for students) DAC Development Assistance Committee of the OECD DANIDA Danish International Development Agency, Danish Minstry of Foreign Affairs (South) DEG German Private Finance Agency for Developing Countries DG Directorate-General DGIS Directorate General for International Cooperation (Netherlands) DIAL Developpement des Investigations sur Adjustement a Long Terme, Paris DIE Deutsches Institut fur Entwicklungspolitik (German Development Institute) DSE Deutsches Stiftung fur Internationale Entwicklung (German Foundation for International Development) EAC European Agency for Co-operation EC European