How Political Dialogue Between Donors and the Government Was Instrumental in the Implementation of the Principles of the Paris Declaration for Aid Support to Mozambique

Context

The Paris Declaration on Aid Effectiveness (2005) and the Accra Agenda for Action (signed in 2008 to support the implementation of the first document) are two key documents aiming to provide guidelines for Aid Effectiveness. They set out a practical, action-orientated roadmap to improve the quality of aid and its impact on development. The documents consist in action-focused guidelines organized around five principles (Ownership, Alignment, Harmonisation, Managing for Results, Mutual Accountability), and require both partner countries and donors to mutually assess their commitment to Aid Effectiveness.

Until the discovery in 2015/2016 of illegally contracted debt by the Mozambican government in charge from 2009-2014, Mozambique provided the international community with a good case study to assess the effectiveness of political dialogue on the delivery of international aid. The country evolved from around 90% of foreign aid dependence in 1992 -when a peace agreement was achieved following 16 years of violent armed conflict- into about 25% in 2016. A fragmented context of aid delivery characterised by duplication, competition, creation of parallel structures, stringent conditionality and burdensome reporting in the 1990s was transformed into one of coordination of international cooperation and mutual donor-national partner accountability.

Entry point 

A framework for mutual accountability existed in the country since 2005, establishing the main coordination principles for international cooperation. In 2010 the government adopted an International Cooperation Policy and its Implementation Strategy. Mutual accountability in this case entailed a regular process of bringing together the civil society, the international community, and state bodies in dialogue and consultation. These interactions occurred within a tiered mechanism comprising, first, sector and thematic groups, second, management groups, and third, political-level exchange. The collaboration was based on the follow-up of an agenda of shared interests, aiming to consolidate the behaviour change required to see significant results.

The donors’ and Mozambique’s aid approaches shifted from project-oriented to sector-specific assistance and general budget support. Budget support activities, such as sectoral support and budget overview were instrumental in maintaining continued dialogue between the parties. It contributed to the implementation of a solid dialogue structure, built on the definition of policy goals and a framework for annual monitoring. A Performance Assessment Framework, defined by a Memorandum of Understanding, acted as the main instrument for monitoring and evaluation between the national government and 19 donors (Austria, Belgium, Denmark, European Commission, Finland, France, Germany, Ireland, Italy, Netherlands, Norway, Portugal, Sweden, Switzerland, Great Britain, Spain, Canada, the WB and the AfDB. The US, Japan and the UN were associate members). The overall implementation of the Paris Declaration on aid assistance to Mozambique was monitored through surveys that took place in 2006 (base-line), 2008 (mid-term) and 2011 (final evaluation). 

Lessons identified

Country-level evaluation as an incentive for good practice – Mozambique  and donors agreed to robust, data driven, country level assessment of progress, which was the basis for political level discussions on what had been achieved and what should be done further. The existence of an agreed strategy between both parties, as well as of aid effectiveness targets and assessments undertaken by both sides, were prerequisites for success.  Evaluation reports showed that participants from the state of Mozambique considered the programme as serious and of high value. This positive appreciation represented a major step towards mutual trust.

Political Dialogue is more efficient on a sector-based approach – In sectors where the partner’s priority matches the donor’s agenda, and where dialogue is strong enough to allow a mutually-defined strategy, funding is more likely to flow according to the Paris Declaration principles. In Mozambique this trend was observed by comparing aid to the health sector, which had been informed by strong ownership and a clear vision, to the agriculture sector where the support funds reduced significantly over time.

To be effective Political Dialogue has to be inclusive of all major aid partners - The BRICS provided a considerable share of aid to Mozambique but were not part of the G-19 and the abovementioned arrangements for aid harmonisation. As a result the policy influence of the donors became even further limited as domestic resource revenue increased.   

Sustainability of positive results requires inclusion of the justice and security sectors into the political dialogue and progress in these areas – The joint reviews generated renewed impetus to implementation of legal and judicial reforms. However, appraisal of progress on justice related reforms was contentious between Mozambique’s government and the donors, due to slow progress in increasing efficiency, transparency, and human rights compliance. The security sector was not part of the framework of thematic and sector exchanges, and therefore was absent from the political dialogue, opening-up to vulnerabilities from a governance standpoint.

Impact

Political discussion and dialogue enshrined in the Paris Declaration had become an integral component of the interaction between most Western donors and Mozambique’s government.  Thanks to several awareness-raising initiatives, a number of civil society bodies took part in the dialogue process, and participated actively on discussions around the role of civil society in promoting aid effectiveness. Specific support was provided to civil society by the UN and donors, with the government of Mozambique committed to engage with it more closely.  

The fact that donor resources were channelled through pooled accounts and managed through national systems enabled the government to incorporate most sectoral funding into the national budget, allowing it to better design and implement programmes according to own priorities. In addition, it resulted in greater accountability to the citizens and the Parliament, which gained better visibility and control over budget approval and its implementation. 

A well organised dialogue on policies and results achieved through donor harmonisation has been established through the lessons of the Budget Support. Alignment of the government of Mozambique and Budget Support partners was consequently improved. This has given rise to a well-organized and publicly accessible database of international support provided across sectors (ODAMOZ). The annual review on governance and fight against corruption through the Budget Support dialogue generated some progress in those areas. The mutual accountability framework pioneered in Mozambique has been highlighted as an international reference, for having improved relations between donors and partners. However, despite improvements in public finance management, in multi-stakeholder dialogue and harmonisation of aid, these efforts did not resist a break in trust between donors and the Government upon the discovery of the latter’s hidden loans, allegedly to finance the security sector. Improved national capacity to manage the complex dialogue mechanism, better public finance management monitoring, and a stronger culture of good governance are key to sustainability. 

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