Rich fall short of aid promises to poor

FRANCE: Rich countries must carry out promises to give money to poor states which are suffering from the economic crisis, the OECD said on Wednesday, saying the flow was short by 30 billion dollars (24 billion euros) a year.

"Donors promised to increase funding by some 50 billion dollars per year by 2010 compared with 2004, but OECD studies of their budget allocations find a shortfall of some 30 billion dollars," the OECD Development Co-operation Report said.

The report, by an offshoot of the Organisation for Economic Cooperation and Development grouping of 30 leading industrialised countries, urged donors to boost their spending plans. Such aid was a strategic part of successful globalisation and benefited both sides, the report commented, and emerging economies "must assume responsibility for their share of the partnership."

The economic crisis was hitting developing countries by undermining growth and trade, the prices of their natural resources, the amount of money sent home by nationals working abroad, and reducing investment flows, it said.

The report said international cooperation was a far better response to the crisis than national responses, and that developing countries should increase their revenues by tightening up their tax systems and fighting corruption.

"Less political motivation and waste through red tape and tied aid would deliver more money to the people who need it," the report said.

It added that donor countries should spend less on their own agendas and more on what was in the programmes of developing countries.

About 225 bilateral and 242 multilateral agencies are currently funding more than 35,000 activities each year.

But for 24 countries, 15 or more donors combined provided less than 10 percent of total aid received, it said.

"The transaction costs, both for donors and recipients, are massive and could easily be reduced if donors' efforts were more coherent, co-ordinated and focused."

Paris, Thursday, AFP