This Aid Effectiveness Report, which has been prepared for the second meeting of the Cambodia Development Cooperation Forum (CDCF), represents an important contribution to the dialogue on national development. By making close reference to recent national policy developments, including the Rectangular Strategy for Growth, Employment, Equity and Efficiency - Phase II, which was launched by Samdech Akka Moha Sena Padei Techo Hun Sen, Prime Minister of the Kingdom of Cambodia at the First Cabinet Meeting of the Fourth Legislature of the National Assembly on 26 September 2008, and the completion of the National Strategic Development Plan (NSDP) Mid-Term Review, the Report's objective is to consider the role of development assistance and the underlying partnership dynamic in supporting the implementation of the NSDP and the realisation of the Cambodia Millennium Development Goals (CMDGs).
Consistent with the transition from the Consultative Group to the CDCF model, this Report emphasises the importance of national ownership in translating policy commitments into improved capacities, better public service delivery and the realisation of the development priorities articulated in the NSDP. It is therefore instructive to begin the Report by re-asserting the causality between aid effectiveness and development results:
Clarifying the link between aid effectiveness and development results at a national level necessarily implies that a holistic approach must be taken to considering the contribution and impact of aid. By providing a summary overview of resource availability in the period 2003 - 2008, Table One shows the increasing trends in domestic resources and development assistance.
Source: Ministry of Economy and Finance, Department of Budget
Without attempting to articulate the features of a growth model, the role of development assistance as an additional public resource, e.g. in supporting public service delivery, and as a form of crowding-in of private sector investment, e.g. by providing infrastructure and economic services, appears quite evident. Although global empirical models suggest some ambiguity in the relationship between aid and growth, the intuitive relationship in Cambodia looks to be quite strong.
This Report serves an important purpose by consolidating and synthesising a significant number of analytical inputs that have been prepared over the last eighteen months. It reviews this evidence to identify priority actions that are required to ensure effective external support to the implementation of the NSDP. In addition to the routine reporting of TWGs to CRDB/CDC and the improved reporting of development partners on their activities in the Cambodia ODA Database, the period since the first CDCF meeting has been purposefully active and has included: (i) a reflection on the impact and management of technical cooperation; (ii) the Paris Declaration monitoring survey and complementary inputs to the global aid effectiveness work; and (iii) the Evaluation on Aid Effectiveness in Cambodia (taking stock on the implementation of the Cambodia Declaration on Enhanced Aid Effectiveness and the Harmonisation, Alignment and Results (H-A-R) Action Plan at the mid-point in their implementation).
This Report therefore provides an opportunity to consolidate this work and, in the context of the NSDP Mid-Term Review and the Rectangular Strategy (phase II), to highlight their collective policy implications. In particular it provides a summary of key findings derived from the recently-concluded Evaluation in order to propose a number of measures to streamline and accelerate the implementation of the H-A-R Action Plan. It is also important to clarify that the H-A-R Action Plan will not be revised in light of the Evaluation, although some policy actions will be prioritised based on the considered needs of individual Government ministries, development partners and Technical Working Groups (TWGs).
The Report therefore begins by reflecting on partnership initiatives since mid-2007. It suggests that, while there appears to be strong resolve at the level of commitment, this has not yet been fully translated into effective implementation. By considering a number of partnership related activities, including a reflection on technical cooperation and the recent Evaluation, there appears to be a continued need to invest in partnership-based approaches that strengthen trust and, most important, permit clearer communication on a set of pragmatic and realistic activities that will ameliorate the looming onset of 'fatigue'. A quantitative review of aid delivery, complemented by the findings of the Evaluation and the NSDP Mid-Term Review, serves to reinforce these qualitative prescriptions.
The Report then turns its attention to experience in implementing the Joint Monitoring Indicators (JMIs) since mid-2007. The picture from this perspective is broadly encouraging but highlights the divergence between the technical and political nature of aid relations. This combined evidence then provides the basis for identifying a number of policy recommendations, identified in three broad categories: (a) Government; (b) development partner; and (c) joint responsibilities, including those that fall within the framework of the TWGs. A short conclusion then seeks to galvanise both Government and development partners, leveraging global and national sentiment by acknowledging that if Government and development partners cannot take advantage of Cambodia’s favourable climate to implement their respective commitments then the prospects globally – and for the achievement of the MDGs in particular – may appear quite bleak.
In a deteriorating global economic climate the effective use of aid takes on an additional significance given the risk that either external or domestic resources may become more scarce. External assistance may also take on an additional role in supporting the provision of social safety nets that become necessary as a result of the social costs associated with increasing food insecurity and any economic slow-down. With this outlook in mind, and by applying the evidence already gathered, the following points are perhaps the most pertinent:
This Report is about more than improved aid management approaches to planning and budgeting, implementation and performance, or the need for additional research. It is about accountability to each other and to the wider community for achieving development results.