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UNDP STRATEGY IN AID COORDINATION PROCESSES: CAPACITY DEVELOPMENT FOR SUSTAINABLE HUMAN DEVELOPMENT

Submission To OECD/DAC, London 4/10/95

A. CONTEXT

1. The OECD's Development Assistance Committee, the World Bank and UNDP jointly organised a High Level Seminar on Improving the Effectiveness of Technical Cooperation in the 1990s on 20 June 1994. One of the recommendations of the meeting was that UNDP, coordinating with the World Bank, should improve its participation in aid coordination processes and take on greater responsibility for bringing issues to Round Tables(RTs) and Consultative Group (CGs) meetings that will help improve technical cooperation and capacity development. UNDP was invited to submit its strategy in this area to the September 1995 DAC meeting.

2. This invitation coincided with a 1994 in-house UNDP review and evaluation of its experiences in this area as well as corporate examination of UNDP goals, focus and strategy.

3. In May 1995, based on UNDP's review and evaluation of its experiences in capacity development and aid coordination, UNDP management took a number of decisions:

* UNDP's main role is to build national capacity for countries to better establish priorities and manage their development resources for sustainable human development.

* "aid coordination", does not reflect the wide range of issues related to external resource management and is an outdated term. UNDP should move towards a term that reflects partnership, encompasses the changing relationships and the larger number of issues involved between external and internal partners. The term "development cooperation" is recommended;

* UNDP should improve its services and support to Consultative Groups (CGs) and Round Tables (RTs) in the preparatory and follow-up phases. It should also make a meaningful contribution to the CG and RT processes in the area of capacity building for sustainable human development.

* where there is assessed needs, adequate resources should be allocated from central or country funds for development cooperation;

* National Technical Cooperation and Assessment Programmes (NaTCAPs) should be transformed to meet the changing developing country requirements. They should focus on capacity development and the role of technical cooperation in them. Closer links should be established to aid coordination processes; and,

* based on best country experiences to date and latest evaluations, guidance to country offices on development cooperation should be updated.

4. UNDP is now preparing new guidelines, reorganizing its structure and reallocating resources to be able to implement the decisions of UNDP senior management. UNDP's Regional Bureaux have taken leadership in this exercise, while the Management Development and Governance Division, is the UNDP focal point for capacity development and development cooperation issues.

B. UNDP STRATEGY IN DEVELOPMENT COOPERATION PROCESSES

5. UNDP's strategy has three components:

i. in CGs and RTs, providing an analysis on capacity development for sustainable human development (SHD), with priority focus on poverty issues.

ii. strengthening national capacities to be able to effectively engage in and manage development cooperation relations, particulary in the areas of sustainable human development.

iii. improving its services and support to national governments involved in CG and RT processes, particularly in the follow-up phases at the country-level.

6. The types and combinations of development cooperation processes and instruments supported by UNDP will vary from country to country and will be based on consultations with national authorities, the World Bank and key donor partners. Different approaches are to be pursued for Round Tables -- which are led by national authorities -- and Consultative Groups - - which are chaired by the World Bank and are linked to the macro-economic framework for each country.

7. In Round Table countries, UNDP may support national authorities in one or more of the following areas: national capacities to manage and prepare for RT; build national substantive and technical capacities in development cooperation issues, particulary SHD and poverty issues; support national bodies to prepare documentation, programmes for financing and resource mobilization activities; support national processes to involve civil society and private sector representatives; logistic support to RT process; and, follow-up support to RT process including supporting country-based RT meetings and helping national authorities implement RT recommendations.

8. In Consultative Group countries, UNDP's strategy is to support the CG process and complement the World Bank, particularly by providing a substantive input on issues related to capacity building for sustainable human development. This input will be become the responsibility of UNDP and it is expected that adequate time will be allotted for adequate discussion in each CG. In preparing the statement, UNDP will consult national authorities, as well as other UN agencies who will not be represented at the CG. On request, UNDP will also help national authorities to prepare for and follow-up to CGs. Emphasis will be given to supporting development cooperation processes at the country level, where other society actors can be involved, such as the private sector and NGOs.

9. In all developing countries, including other countries not in the RT or CG regime, support to capacities for development cooperation could include: supporting national authorities to articulate development policies and priorities for official and private external/domestic resources; supporting coordination and external resource management capacities; supporting members of civil society and private sector involvement in national policy dialogue; and building capacities in specific areas such as aid accountability and national execution. The assessment of needs will take place at the time of UNDP country programme formulation.

10. Rolling out this strategy is expected to take two years. UNDP is already ensuring all new projects approved have the new UNDP strategy built into them (including two new umbrella projects for Africa and Asia, covering over 40 countries). LDCs and special-situation countries (e.g. humanitarian, emergency, newly independent, transition countries) will be given first priority. Needs for development cooperation and adequate resources to implement UNDP's strategy will be planned for with government when the new UNDP country programmes (now called the Cooperation Framework) are designed in 1997. Until then, bridging funds are being provided to countries from headquarters-based resources. Much of UNDP's expansion will be based on the best experiences of UNDP to date (please see Annex I for examples) The development of a training package in capacity development will be given priority.

C. CAPACITY DEVELOPMENT ISSUES TO BE ADDRESSED

11. For the agenda item on capacity development at CGs, in consultation with governments and the World Bank, the types of analysis UNDP will provide include the following:

* The role of development cooperation (particularly technical cooperation) in meeting clear national goals and priorities. Particularly address whether such external resources support sustainable capacity development or possibly undermines it. Provide options to improve sustainability and ownership, particularly as they relate to sustainable human development and poverty eradication.

* The capacity development requirements related to the areas of sustainable human development -- particularly poverty, gender, sustainable livelihood and environment -- and "patterns of action" to implement SHD, such as support to the "enabling" environment, sound governance and management, the private sector, promotion of science and technology, cooperation with civil society and participatory institutions, and development support to emergency-prone situations.

* The building of national capacity to translate UN-sponsored international agreements into national programmes of action.

* The specific capacity development requirements of specific externally-funded programme to meet national goals (especially those that are being discussed at the CG), particularly addressing issues related to sustainable human development and the impact of the programmes on people in that country.

12. Similar issues will be addressed in RTs. However, since RTs are lead by the government, national authorities will be supported to provide such analysis and inputs.

D. UNDP FOLLOW-UP

13. UNDP will provide a follow-up report in the first half of 1996 outlining progress made in implementing the above strategy. Where UNDP provided support, benchmarks to gauge progress will include the following:

* Clear UNDP guidance prepared, resources made available to UNDP country offices and training programme designed and implemented;

* Improved quality in government preparation and inputs in development cooperation meetings held in the next 12 months;

* Improved quality and timeliness in Round Tables processes and other development cooperation meetings -- particularly at the country level.

* In preparatory phases of meetings, degree of involvement at the country level members of the private sector and civil society in the policy dialogue and documentation preparation;

* Substantive statements in CGs, addressing key issues in capacity development for sustainable human development, leading to policy discussions on issues raised;

* UNDP instruments, such as NaTCAP and programme approach, improved or redefined to focus on capacity development for sustainable human development;

* Success in supporting national bodies (governments, private sector, NGOs etc.) -- in collaboration with donors -- to design quality programmes in the areas of sustainable human development and poverty eradication, and to mobilize resources;

* demonstrated success in supporting to national authorities to successfully follow-up to CG and RTs;

* For longer-term, where requested, improved national capacities to coordinate and manage overall development resources.

Annex 1: Country Profile

Gambia

The Gambia is an excellent example of UNDP's aid coordination activities and catalytic role particularly in the Round Tables (RT) in regularizing the meetings and the progressive improvement in preparation, substantive dialogue and results. The Gambia example also showcases UNDP's effective cooperation with the Government throughout its SPA (Strategy for Poverty Alleviation) exercise which served as an important focus for Sustainable Human Development (SHD) activities.

Through its project GAM/92/U71, UNDP provided support to the Government of the Gambia as part of the Economic Management Capacity-Building strategy which, inter alia, sought to strengthen the Government's capacity to implement and monitor the Round Table Process. The project was proposed at the request of the Government which considers aid coordination as one of its top priorities and considers UNDP as the lead agency with regard to the Round Table process. UNDP's short-term objective with this project was to support national authorities to successfully implement the Fourth Round Table conference; the long-term objective of the project was to enable the Government to establish an operational monitoring mechanism for the Round Table process as well as developing its capacity to effectively manage it.

The Fourth RTC was overall considered a success not only in terms of preparation and policy dialogue but also in terms of its substantive outcome. The Gambia presented its Strategy for Poverty Alleviation (SPA) for review by participants. The SPA constituted four pillars: (i) enhancing the productive capacity of the poor; (ii) improving access to, and performance of social services; (iii) building capacity at the local level, and (iv) promoting participatory communication processes. This strategy is a clear operational articulation of UNDP's SHD priorities demonstrating its vital role as coordinator in the development dialogue both within the Government and among donors. Across the board, most donors indicated their support of SHD policies through pledges in support of particular aspects of the SPA, specifically in the areas of capacity building at the local level, environment, participatory approach, community development and decentralization.

UNDP's efforts to work with the Government to strengthen Round Table follow-up activities was successful, resulting in two sectoral consultations: one on Industry, Private Sector Development and Vocational Training scheduled for December 1994 and another on Population, Health and Education scheduled for the first quarter of 1995. In addition it was proposed that the Fifth Round Table Conference be held during the last quarter of 1995 in order for the Government to review with its partners its medium-term development strategy, focusing on diversification, and to take stock with regard to the implementation performance of the SPA. Neither of these consultations were held due to a change in government which took place in July 1994 - both consultations have been postponed as the current emphasis in the Gambia is now on governance and elections.

Results:

In the processes and outputs above, UNDP:

- funded the RT process;

- prepared, through national consultants, the RT documents, in particular the "SPA Implementation Process";

- supported the Government to lead the RT coordination process;

- was involved in the RT dialogue, advocating an SHD viewpoint;

- helped prepare the SPA; and

- helped the government mobilize $400 million as a result of the above efforts.

The two most recent reviews/evaluations are: i) Aid Coordination and Aid Management by Government: A Role For UNDP, undertaken by COWIconsult in 1994 based on studies in Zimbabwe and Sri Lanka; and, ii) Aid Coordination and NaTCAP Evaluation, Bureau For Programme and Policy Support, UNDP, 1995.