The Development Aid Business

• There is an unprecedented resolve on the continent to turn away from the begging bowl and engage in new efforts to build a better life.

Thabo Mbeki• Development aid cannot continue indefinitely.

The task is therefore to use limited resources as effectively as possible. This can only work through good governance which taps that country's economic potential. Angela Merkal, German Chancellor at the High Level Plenary Meeting of the UN General Assembly on the Millennium Development Goals 21st September 2010

Total ODA and ODA in Africa

The Aid Business• ODA budget - US$ 140 billion (2010)• > 100,000

• – 10,000 employees• If Aid were a business it would rank 19th in the

world by turnover on a par with Allianz• In terms of employees Aid employs the same

number of people as GlaxoSmithKline

MAJOR ODA DONORS

6

7

88

At sector level: Procurement chain of donors in health in Kenya

Contra-ceptives and

RHequipment

STIDrugs

EssentialDrugs

Vaccinesand

Vitam in ATB/Leprosy

BloodSafety

Reagents(inc. HIV

tests)

DFID

KfW

UNICEF

JICA

GOK, W B/IDA

Source offunds for

com m odities

Com m odityType

(colour coded) M OHEquip-m ent

Point of firstw arehousing

KEM SA Central W arehouse

KEM SARegionalDepots

Organizationresponsible

for delivery todistrict levels

KEM SA and KEM SA Regional Depots (essential drugs, m alaria drugs,

consum able supplies)

Procurem entAgent/Body

Crow nAgents

Governmentof Kenya

GOK

GTZ(p rocurem ent

im plem entationunit)

JSI/DELIVER/KEM SA LogisticsM anagem ent Unit (contraceptives,

condom s, STI kits, HIV test kits, TBdrugs, RH equipm ent etc)

EU

KfW

UNICEF

KEPI ColdStore

KEPI(vaccines

andvitam in A)

M alaria

USAID

USAID

UNFPA

EUROPA

Condomsfor STI/

HIV/AIDSprevention

CIDA

UNFPA

USGov

CDC

NPHLS store

M EDS(to M issionfacilities)

PrivateD rug

Source

GDF

Governm ent

NGO/Private

Bilateral Donor

M ultilateral Donor

W orld Bank Loan

Organization Key

JapanesePrivate

C om pany

WHO

GAVI

SIDA

NLTP(TB/

Leprosydrugs

Commodity Logistics System in Kenya (as of April 2004) Constructed and produced by Steve Kinzett, JSI/Kenya - please com m unicateany inaccuracies to skinzett@ cb.jsikenya.com or telephone 2727210

Anti-RetroVirals

(ARVs)

Labor-atorysupp-

lies

GlobalFund forAIDS, TB

and M alaria

The"Consortium"

(Crow n Agents,GTZ, JSI and

KEMSA)

BTC

M EDS

DANIDA

M ainly District level staff: DPHO, DPHN, DTLP, DASCO, DPHO, etc or staff from the Health Centres,Dispensaries com e up and collect from the District level

M EDS

Provincial andDistrict

HospitalLaboratory

Staff

Organizationresponsible fordelivery to sub-

district levels

KNCV

M SF

M SF

9

… may create coordination problems!

10

Demand for aid

• Confronting the challenges of financing for development : a global response

• Ownership: Countries have more say over their development processes through wider participation in development policy formulation, stronger leadership on aid co-ordination and more use of country systems for aid delivery.

• Inclusive partnerships: All partners - including donors in the OECD Development Assistance Committee and developing countries, as well as other donors, foundations and civil society - participate fully.

• Delivering results: Aid is focused on real and measurable impact on development.

• Capacity development - to build the ability of countries to manage their own future - also lies at the heart of the AAA.

Africa's share of global FDI projects (in %)

Barriers to investing in Africa

1. Mission Creep

2. Exit Strategy

3. Symbiotic Relationship

derek.fee@devaidpartners.com