VDF Workshop No.24
December 8, 2004

Matching Aid with Country Needs and Ownership"

by Professor Izumi Ohno and Ms Niiya Yumiko (GRIPS Development Forum)

This workshop presented the ongoing research by Prof. I. Ohno and Ms. Niiya on the choice of aid modalities in terms of both the general framework and specific factors to be considered in Vietnam. After reviewing the current aid modality debates, Prof. I. Ohno presented the Development Priority Matrix (DPM) and the prototypes of ownership which served as a conceptual framework for choosing aid modalities taking account of the country- and sector-specific situations. She then showed selected case analyses of different combination of modalities (e.g., Vietnam, Cambodia, Tanzania, and Ghana). Ms. Niiya explained her case study, which examined the applicability of the above conceptual framework for Vietnam’s health sector. Noting the past failure of donor attempt to introduce SWAp, she stressed that with Vietnam’s relatively high health achievement and low aid dependency, the characteristics of the health sector in Vietnam significantly differed from those of other low-income countries where new aid modalities were originated. 

They emphasized the importance of matching aid with country needs and ownership, especially taking account of (i) development priorities in the recipient country; and (ii) recipient-donor relationships in the aid process. They also stressed the need to pursue “good donorship” even within the same modality.

 Many participants stated that the DPM could be a useful framework for starting to think analytically about modality choice. At the same time, they questioned how growth policy and industrial strategy could fit into DPM. The current DPM seemed to be focused on the public sector domain. While such focus may be appropriate for the analysis of the sub-Saharan African context where the expansion of basic social services is national priority, Vietnam’s development needs are more diverse and include many growth agenda. Even social needs are more complex, such as rising income gaps, environmental problems, and political pluralism (“growth pains”). 

Some participants noted that Vietnam counted on diverse sources of funding for development—such as budget and FDI—in addition to ODA and that there were also many actors involved in the process of development-related activities, especially with the progress of decentralization. In Vietnam, ODA is only a supplementary source for development and that it is important to harmonize the procedures not only among donors and between donors and the government, but also among different levels of government, civil groups and private enterprises. Therefore, Vietnam needs to improve the content of development policies, not limited to aid management. There were also comments that there was diversity even within project aids. For example, some projects can address not only implementation issues but also policy and institutional reforms. Projects can also take programmatic approaches.

 Prof. I. Ohno and Ms. Niiya appreciated these comments. While their research primarily aims to provide a criteria for choosing aid modality by relativising the dominant view which originated in Sub-Saharan Africa, they will continue to improve the framework in light of the comments given in the Vietnamese context.