UNDP RESOURCES TRENDS & DIRECTIONSDRM/Partnerships Bureau

RBEC DRR/DCD MEETING17 DECEMBER 2008

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Overall resources picture

• Composition of Resources

• Sources/Contributors

• Past Trends

• Future Direction – SP Ambition – Changing Aid Environment

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• UNDP’s average annual income over the past three years (2005/6/7): +/- $5 billion: UNDP is the largest UN entity in financial terms (after PKO) and represents close to 1/3 of the UN systems development resources

• In addition, UNDP administers a $3,3 billion portfolio of MDTFs and ‘Joint Programmes’ on behalf of the UN system (as of 31 August 2008)

• Total contributions to the UN’s operational activities for development exceeded $16 billion in 2006, making the UN system in development - with all its agencies taken together - the biggest multilateral development actor

UNDP - Overall resources picture

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Growth in UNDP Income 1992 - 2007

Multilateral resources

Bilateral donor resources

Local resources

Regular resources

Administered funds

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Growth in UNDP Income 1992 - 2007

Source: UNDP

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Regular Resources - ’Core’

• What is ‘Core’ and why is it so critical?

• Current Core Donors & Contribution Trends

• Issues: Predictability, Vulnerability, Burden-Sharing

• Core to Non-Core Ratio

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Source: OECD and UNDP

600

800

1000

1200

1400

1600

1800

2000

2200

2400

-

20 000

40 000

60 000

80 000

100 000

120 000

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

UNDP core (in 2006 $'000)

ODA (in 2006 $'000)

Total ODA

UNDP core

DecliningODA

IncreasingODA

UNDP Core vs Total ODA

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Top 10 Donors US $ %

Norway 131,606,099 11.8%

Netherlands 124,885,198 11.2%

Sweden 119,932,622 10.7%

United Kingdom 109,931,081 9.9%

United States 106,870,000 9.6%

Japan 75,012,667 6.7%

Denmark 69,693,746 6.2%

Spain 60,888,987 5.5%

Canada 56,726,908 5.1%

Germany 45,876,987 4.1%

TOTAL 901,424,295 80.8%

Top 10 Donors to UNDP Core: 2007

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Comparative Analysis on Core Contributions to UNDP, UNICEF, WFP: 2006

(Thousands of current United States dollars)    

UNDP UNICEF WFP  

  US$ % Total US$ % Total US$ % Total

Contributing M/S 963,457 100.0% 473,524 100.0% 241,681 100.0%

# Contributing M/S 65 34.0% 101 52.9% 47 24.6%

Top 5 Contributors 552,553 57.4% 302,786 63.9% 179,566 74.3%

Top 10 Contributors 822,986 85.4% 402,131 84.9% 232,248 96.1%

DAC Member States 946,695 98.3% 456,668 96.4% 238,046 98.5%

EU Member States 421,983 43.8% 171,537 36.2% 115,372 47.7%

BRICS Member States 8,042 0.8% 4,423 0.9% 1,868 0.8%

G8 Member States 402,131 41.7% 217,708 46.0% 64,650 26.8%

G20 without G8 M/S 137,620 14.3% 72,541 15.3% 56,866 23.5%

G20 Member States 539,751 56.0% 289,249 61.1% 121,516 50.3%

Source: UNDESA (2007) Comprehensive statiscal analysis of the financing of operational activities of the United Nations system: 2006 update

Concentration of Core in UNDP/UNICEF/WFP

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UNDP Core IDA (annualized)2007 assessed

contribution to UN regular budget (US$)2006 2007 14 15

Argentina         6,502,453

Brazil     42,050,665 62,055,474 17,526,612

China 3,350,000 3,400,000   9,934,530 53,360,129

Czech Republic 438,231 485,814 3,449,335 5,906,199 5,622,120

India 4,558,596 4,412,238   - 9,003,396

Indonesia   147,693     3,221,215

Kenya         200,076

Korea 1,000,000 1,000,000  62,732,039 92,580,931 43,476,401

Kuwait   1,710,000 9,650,332 14,200,118 3,641,374

Mexico 1,000,000 1,000,000 3,449,335 5,138,898 45,157,034

Nigeria         960,362

Poland 15,000 50,000     10,023,781

Russian Federation   1,100,000 19,515,333 35,336,233 24,009,056

Saudi Arabia 2,000,000   16,666,095 21,878,176 14,965,645

Singapore 300,000 300,000 9,650,332 8,803,770 6,942,619

South Africa         5,802,189

Thailand 865,112 865,112   - 3,721,403

Turkey 400,000 1,000,000 6,205,876 5,048,033 7,679,746

United Arab Emirates 324,000 648,000   - 6,042,280

Venezuela   10,000     4,001,509

Comparison: UNDP Core – IDA (annualized) UN (assessed annualized)

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Other Resources - ’Non-core’

• What is non-core, why is it important, how is it mobilized

• Issues: Concentration, Delivery, Reporting, Potential Impact on Core

• Non-core: Bilateral and Multilateral Sources, Local resources

• Thematic non-core (e.g. thematic trust funds)

• Global, regional, multi-country and country-level non-core resources

• Non-core from the Private Sector, Foundations, CSOs*11

UNDP Non-Core vs Total ODA

Source: OECD and UNDP

200

1200

2200

3200

4200

5200

-

20 000

40 000

60 000

80 000

100 000

120 000

UNDP non-core (in 2006 $'000)

ODA (in 2006 $'000)

Total DAC ODA

UNDP non-core

Declining ODA Increasing ODA

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Top 10 Donors US $ million % of total

United Kingdom 201.71 18.7%

Norway 110.91 10.3%

United States 100.30 9.3%

Sweden 95.70 8.9%

Netherlands 91.56 8.5%

Canada 87.53 8.1%

Spain 87.48 8.1%

Japan 79.47 7.4%

Italy 40.49 3.7%

Germany 29.74 2.8%

TOTAL 924.89 85.6%

Concentration of Bilateral Non-CoreTop 10 Donors in 2007

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Concentration of Multilateral Non-CoreTop 5 donors in 2007

Top 5 donors US $ million % share

European Commission 317.11 26.4%

GEF 284.25 23.7%

GFATM 153.52 12.8%

UN System 177.95 8.9%

World Bank 107.31 14.8%

TOTAL 1040.14 86.7%*14

Concentration of Bilateral and Multilateral Non-CoreContributions to UNDP

% Share of Top Recipient Countries

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Resources from Countries in the RBEC Region (US $)

RBEC Region2006 2007

Core GLOC Local resources Bilateral Core GLOC Local resources Bilateral

Albania   366,364 34,957 86,573  254,571 199,950 0Armenia   0 256,986 0  0 254,036 0Azerbaijan   0 13,015,606 0  0 8,803,798 10,000Belarus   34,621 1,999 0  49,780 141,253 0Bosnia/Herzegovina   0 1,406,163 0  0 1,871,900 0Bulgaria   282,167 3,283,343 0  279,981 6,141,992 0Croatia   0 31,452 2 30,000 30,000 1,107,675 0Cyprus       0      0Czech Republic 438,231 0 743,642 71,178 485,814 0   1,053,901Estonia 33,682 0   24,510  0   0Georgia   0 5,135,114 0  0 1,678,625 0Hungary   0   0 10,000 0   0Kazakhstan   114,975 17,497 0  114,954 70,000 0Kosovo     3,849,163 63,241    4,013,733 0Kyrgystan   0   0  0   0Latvia   0   0  0 19,517 0Lithuania   0 386,373 0  0 229,538 0Macedonia   0 1,910,963 0  0 1,526,467 0Moldova   6,713 530,030 0  0 426,791 0Montenegro       0    73,746 0Poland 15,000 15,000 5,282,912 150,300 50,000 0 9,116,841 11,100Romania   145,455 3,494,899 39,870  166,667 4,429,547 2,502Russian Federation   1,100,000 10,615,766 50,000 1,100,000 780,870 1,746,102 0Slovakia   0 3,689,135 0  0 29,828 0Slovenia 25,000 0   0 30,000 0   0Tajikistan   30,000 432,147 0  36,605 319,316 0Turkey 400,000 751,525 4,728,474 57,546 1,000,000 845,378 5,576,819 678,346Turkmenistan   0 50,885 0 2,000 2,000   0Ukraine   52,614 744,504 0  0 1,456,785 0Uzbekistan   0 6,168,304 0  0 4,421,960 0Yugoslavia   0 13,175 0  0 0 345,537TOTAL 911,913 2,899,434 65,823,489 543,220 2,707,814 2,560,806 53,656,219 2,101,386

‘Non-Core’ to RBEC Region: 2005 – 2007

(US $ million)

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160

2005 2006 2007

Local Bilateral Multilateral

LOCAL RESOURCES in 2000 and 2007

2007: $1,265.82 million2000: $934.36 million

Non-core Instruments

• Principal Instruments for Non-Core Resources:

Financial/Legal agreements

• Partnership/Framework Agreements, MOUs

• Cost-sharing

• Trust Funds (open/closed)

• Special Case: Spain’s MDG Achievement Fund with UNDP

• Multi-Donor Trust Funds, Joint Programmes (UNDP

as Administrative Agent for the UN system)

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Comparison Trust Funds vs. Cost-Sharing

Trust Fund Cost-Sharing

PurposeFunding modality created on the

basis of a TOR for global or country-wide programmes that usually

consist of a number of projects

Support to a specific project or part of country programme

Financial and accounting

A separate accounting entity; accounted for and reported

separately to the Executive Board; complete commingling of funds

Direct funding of projects, which can be received either from a single donor, or can combine

resources of UNDP and various donors for a given set of project

outputs.

What does this mean for CO?

Centralized signatory authority of the Associate Administrator; labor intensive due to administrative

burden associated with accounting/administration

Decentralized signatory authority to RR for standard agreements;

less administrative burden

Other

Requires the designation of Trust Fund Manager

Use of donor contributions is normally limited to the duration of a

particular project.

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Elements of a Changing Aid Environment

•Overall Aid Picture

•Non-DAC Aid Flows

•Increasing Prominence of NGOs

•High-Profile Foundations

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Overall Aid Picture

1990s and early 2000s see DAC ODA routinely reach some 95% of all international aid – DAC likely to remain dominant, considering the ODA increases announced by most of its members

Non-DAC donors are ‘(re-)emerging’ – magnitude hard to establish (reporting habits vary, definitions differ, aid often tied and bundled with economic interests)

Clearest picture of Non-DAC ODA results from other reporting OECD members, reporting Arab states and EU accession countries

Aid from increasingly visible donors such as China and India remains hard to interpret and often bundled with investment, trade etc

Private aid flows, foundations in particular, are reporting very significant donations and achieve a lot of visibility, some are expected to disburse development aid at high levels in future years

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• Several emerging economies are known to channel substantial aid but most do not report/publish data systematically and/or do not follow DAC definitions e.g. China, India - or available data bundles aid with trade/investments.

• China stopped officially reporting aid in 2002. In that year, aid to African countries had amounted to $1.8 billion. By the end of 2005, China had forgiven debts totaling $1.38 billion by 31 African countries. China’s financial aid to Africa clearly accelerating, but hard to interpret. IMF: By end 2006, China loans and credit lines to Africa worth $19 billion.

• Only three Arab states report aid regularly. The Arab region has a strong aid tradition, but financial data for the wide range of national and regional Arab aid funds and foundations is in most cases not publicly available.

• Venezuela has offered at least US$ 1.1 billion since the beginning of 2005 in loans, donations and financial aid in the Latin America and Caribbean region, but also in to some African countries

• A number of the non-DAC OECD members in Eastern Europe report data on their net ODA flows regularly through the DAC and, thus, allow for an easier overview and analysis as is possible in other MICs/regions

Non-DAC Aid Flows – Pieces of a Puzzle

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Source: OECD DAC. 2007. Final ODA flows in 2006

Net ODA Flows from reporting non-DAC Countries (millions of current US dollars)

2002 2003 2004 2005 2006OECD Non-DAC Czech Republic 45 91 108 135 161 Hungary .. 21 70 100 149 Iceland 13 18 21 27 41 Korea 279 366 423 752 455 Poland 14 27 118 205 297 Slovak Republic 7 15 28 56 55 Turkey 73 67 339 601 714 Arab countries Kuwait 20 138 161 218 158 Saudi Arabia 2 478 2 391 1 734 1 005 2 095 United Arab Emirates 156 188 181 141 249 Other donors 134 116 527 664 798

TOTAL 3 218 3 436 3 712 3 905 5 172

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Foundations – Key Examples

• Bill & Melinda Gates Foundation grants since inception to September 2007: $997m for “Global Development” and close to $8.5 billion for “Global Health”. With the combined commitments of Gates and Buffet, the capital base is expected to reach $56 billion. The foundation is epected to be in a position (and under pressure) to award grants between $2.5 and $3 billion annually in coming years (equals total ODA of Canada, Norway or Denmark (WHO’s planned exp. 08/09: $2.1billion/p.a.)

• The Al Maktoum Foundation (Dubai) launched in May 2007 with a US$10 billion endowment supports initiatives to boost the knowledge capital of the region (funding research institutions, youth leadership programmes, scholarships and research grants). In 2007, Sheikh Al Maktoum launched a campaign to raise money to educate 1 million children in poor countries. The campaign is Dubai's contribution for providing Children's Primary Education to every child by 2015. The amount donated to this campaign has exceeded US$ 65 million six days after its launch.

• Soros Foundation and the Open Society Institute: expenditures currentlyaverage between $400 and $500 million annually

• The Aga Khan Foundation as part of the Aga Khan Development Network had a 2006 income of $254m and expenditures of $185m (capital base: $1.1 billion). It’s regional focus lies on Central Asia and the CIS *25

• Aid paradigm changing across regions – traditional distinction between donor and recipient countries no longer applicable – need for a corporate strategy towards MICs and NCCs (Greentree meeting)

• Impact on UNDP presence/offices in different contexts and regions (financial, programmatic, political) - need for a corporate approach with tailor-made responses to regions and, when applicable, individual countries

• RBEC: Early engagement through BRC with the changing environment in Eastern Europe, in particular – need to build on it in cross-bureau cooperation (capacity development, aid effectiveness, multilateral donorship, ODA management)

UNDP and the Changing Aid Environment

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