Foreign aid: why the Paris declaration matters

OECD Observer

The Newsletter has been prepared by the Public Affairs Division of the OECD for the purpose of informing the public of OECD cooperation with civil society. The Public Affairs Division acts as a clearing house for information about OECD dialogue with civil society. OECD staff who are in contact with civil society through consultations, workshops or other activities contribute to this newsletter.

I. Feature Article:

The UN World Summit and the Paris Declaration on Aid Effectiveness

Leaders meeting at the 2005 World Summit in New York renewed their pledge to seek multilateral solutions to the problems of developing countries and highlighted the Paris Declaration on Aid Effectiveness as an avenue worth pursuing (Outcomes II23c).

The Paris Declaration on Aid Effectiveness was signed in March of this year in Paris at a meeting of over 100 wealthy and developing countries and international agencies. The meeting, jointly organised by the OECD and the World Bank and hosted by the French Finance Ministry, proved to be another milestone in the process of improving the quality of aid undertaken by the OECD Development Aid Committee (DAC) Working Party on Aid Effectiveness and Donor Practices in partnership with several regional development banks, the World Bank, and other international organisations.

The signers of the Paris Declaration agreed to take far-reaching, monitor-able action to reform ways of delivering and managing aid. To achieve these goals, they said, will require “high-level political support, peer pressure and coordinated actions at the global regional and country levels.”

Peer pressure is a standard feature of the OECD process and ensures that member countries live up to their non-binding “gentlemen’s” agreements. The Paris Declaration highlights this effective tool for use by developing countries because it will help them to co-ordinate their actions, stimulate each other, and advance in a more concerted fashion towards shared goals “in a spirit of mutual accountability.” The participants’ acceptance to enter into such a partnership agreement reflects a widely shared perception that to be truly effective, change needs to come from within the developing world.

The Declaration aims at improving the quality and impact of aid by fixing targets for good practices that are reflected in twelve “indicators” to measure progress. The key targets set for 2010 are:

• 75% of developing countries should have effective poverty reduction strategies of their own

• At least 40% of donor country missions in poorer countries should be jointly organised to cut costs

• Two-thirds of all country analytical work should be joint, drastically cutting the number of duplicative pieces of consultancy

• The number of developing countries who improve their own financial systems (budgets linked to policy priorities such as poverty reduction) should be increased by half

• The proportion of countries without transparent and monitor-able performance assessment processes should be reduced by one third.

The next High Level Forum will take place in Ghana in 2008.

II. OECD Forum 2005 – Listening to the views of civil society

The 6th annual OECD Forum “Fuelling the Future: Security, Stability, Development” took place in Paris 2-3 May 2005 and addressed such serious questions on the world agenda as energy supply and climate change, development, trade liberalistion and offshoring. The twelve hundred participants -- business and labour leaders, civil society personalities, government ministers and leaders of international organisations -- discussed the same issues that OECD ministers debated at the annual OECD ministerial meeting which followed the Forum. Swedish Minister for Industry and Trade Thomas Östros reported to OECD ministers on the Forum discussion as follows (excerpts):

“We can not overestimate the need to listen to the views expressed by civil society. We must take peoples’ worries and thoughts seriously. Growth and social cohesion are mutually dependent. If people are not to fear globalisation, they need security and a lessening of inequalities. It was repeated at several panel sessions that people who do not feel safe will resist change and feel pessimistic about the future. As a result, calls for protectionism are on the rise.

But these calls were rejected by many discussants. Instead, the role of domestic policies was stressed. This included, for example, effective labour and social policies combined with efficient education policies. But from the important OECD studies on “Trade and Structural Adjustment” and “Growth in Services”, we have also learned that the actual number of job losses due to off-shoring is rather limited, especially in relation to the total number of jobs lost.

It was also noted that preventing job losses in one area might prevent a much larger number of jobs being gained in the whole economy. In this context, the corporate social responsibility (CSR) of individual firms was highlighted. But it was made clear that CSR is neither about protectionism nor philanthropy. It was instead said to be about setting a floor of decency where dialogue and inter-governmental co-operation were essential. Increased financing for development would be crucial in this respect.”

For further information and summaries of the individual panel discussions, see 2005.

III. Bulletin Board: coming and recent events with civil society


22-23- Trento, Italy: The OECD LEED Trento Centre for Local Development will hold an International Conference on “The Social Economy in Central, East and South-East Europe: emerging trends of social innovation and local development”. The conference aims to increase understanding of the issues and policy options in terms of social cohesion and labour market integration by leveraging social economy potential in Central East and South East Europe.

The conference seeks to strengthen international co-operation, identify “best practices”, develop policy recommendations and agree on policy initiatives in support of the social economy. Debates and discussions will focus on the rationale and legal frameworks for the social economy and social economy tools and practices. For further information or contact Paola Babos


3 – Paris, OECD Working Party on Export Credits and Credit Guarantees and the Participants to the Arrangement on Officially Supported Export Credits. The Working Party will meet with CSOs on 3 October 2005 to exchange views on export credit issues. For further information, contact

3 – Paris, Meeting of the OECD Task Force on SPAM, with the participation of civil society. OECD set up a Task Force on Spam in July 2004 (see The meeting in October will be dedicated to reviewing progress in developing an anti-spam toolkit. The toolkit includes a number of work elements aimed at finding solutions to eliminate spam. It includes work on regulation, regular Investment technical measures, international enforcement co-operation, awareness and education.

3-4 - Paris, 19th Meeting of the Working Party on Information and Security and Privacy (WPISP), with the participation of representatives of civil society.

5 - Paris, Technology Foresight Forum on Radio- Frequency Identification (RFID): “Applications and Public Policy Considerations”, convened by the Committee for Information, Computer and Communications Policy (ICCP). Forum will bring together government delegations, academia, private sector and non-governmental organizations to discuss the implications of current uses and future developments of RFID. Further information are available on or may be obtained by contacting

17-18 – Brussels, 2-day OECD Forum on Ageing and Employment Policies. First day open to civil society representatives by invitation.

17-Paris, BIAC will participate in Roundtable on competition and efficiency in the Provision of Hospital Services.

19 – Paris, BIAC will participate in Competition Committee Roundtable on Barriers to Entry

20 –Paris, BIAC and Consumers International will participate in Committee Roundtable on Sale Below Cost

24 – Paris, Seventh Informal Consultation between the OECD Trade Committee and Civil Society Organisations. This annual event provides an opportunity for an exchange of views between CSOs and senior trade officials on key trade issues and developments, particularly in the context of ongoing negotiations under the Doha Development Agenda. This year's consultation will address priorities for the WTO Hong Kong Ministerial in December, along with issues related to corporate social responsibility and trade. For further information, contact

24-25 Paris, 70th Meeting of the Committee on Consumer Policy (CCP), with the participation of representatives of civil society.

IV. Further reading: OECD Publications regarding civil society

From the OECD Development Centre: Latest policy insights # 13 on the MDGs, taxpayers and aid effectiveness: available at

Environment and the OECD Guidelines for Multinational Enterprises – Corporate tools and approaches

This book provides an overview of the main tools and approaches available to enterprises wishing to put the Environment chapter of the OECD Guidelines into practice. Its numerous examples of companies’ experience with these tools show that sound environmental management is an integral part of sound business. ISBN 9264009396 143pp. Euros 21.

The 2005 Annual Report on the OECD Guidelines for Multinational Enterprises (forthcoming)

Since its creation, the OECD has had co-operative activities with civil society, principally through the Business and Industry Advisory Committee to the OECD (BIAC) and the Trade Union Advisory Committee (TUAC). Over the last decade, this co-operation has been complemented by increasing activities with other civil society organisations.

For further information about OECD cooperation with civil society, see the OECD civil society webpage at contact:

Meggan Dissly, Civil Society Liaison Manager, Public Affairs Division

Tel + 33 1 45 24 80 94

Cynthia Coutu/

©OECD Observer January 2007 

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