Week 6: Zambia and Foreign Aid

The Consolidated Appeals Process (CAP) is a program cycle for aid organizations to plan, coordinate, fund, implement, and monitor their response to disasters and emergencies, in consultation with governments.  It is part of the Inter-Agency Standing Committee.

Gross National Income, or GNI, is the sum of a nation’s gross domestic product (GDP) plus net income received from overseas.  GNI is defined as the sum of value added by all producers who are residents in a nation, plus any product taxes (minus subsidies) not included in output, plus income received from abroad such as employee compensation and property income.  The GNI for Zambia in 2013 was 26,323,453,374 (in U.S. dollars), well below the world average.

The best known target in international aid proposes to raise official development assistance (ODA) to 0.7% of the donors’ national income.  ODA is officially defined by the Development Co-operation Directorate (DAC) of the Organisation for Economic Co-operation and Development (OECD).  The 0.7% of the donors’ national income is the benchmark measure used in practically all aid targets and assessments of aid performance.  The coverage of ODA reporting includes:

  • Military aid: No military equipment or services are reportable as ODA.  Anti-terrorism activities are also excluded.  However, the cost of using donors’ armed forces to deliver humanitarian aid is eligible.
  • Peacekeeping: Most peacekeeping expenditures are excluded in line with the exclusion of military costs.  However, some closely-defined developmentally relevant activities within peacekeeping operations are included.
  • Nuclear energy: Reportable as ODA, provided it is for civilian purposes.
  • Cultural programs:  Eligible as ODA if they build the cultural capacities of recipient countries, but one-off tours by donor country artists or sportsmen, and activities to promote the donors’ image, are excluded.

The ODA standard has been met in Zambia by every major country that donated.  Over the major donor countries here are the breakdowns:

  • United States 1.7%
  • United Kingdom 3.3%
  • Japan 1.11%
  • Norway 9.7%
  • Sweden 9.4%
  • Germany 8.1%
  • Canada 3.1%

According to the OECD, in 2013 the United States donated 30.88 trillion dollars in foreign aid to the world of ODA, or 18% of the GNI.  Zambia received 316 million dollars of aid from the United States with a breakdown:

  • Social Infrastructure= 288 million
  • Production= 17 million
  • Economic Infrastructure= 2 million
  • Multi-Sector= 6 million
  • Humanitarian AId= 2 million
  • Unspecified = 1 Million

The Policy Coherence for Development (PCD) is a report that shows that coherent policies in OCED countries in areas such as tax evasion, anti-bribery and money laundering can contribute to reducing illicit financial flows from developing countries.  The PCD addresses the MDGs of the post-2015 world.  The post-2015 framework of the PCD entails identifying and addressing the interactions among various policies in economic, social, environmental, legal, and political domains to support pathways towards inclusive sustainable growth.

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