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Strengthening Harmonization and Alignment

IDA's Role in Enhancing Country-Level Effectiveness

This paper looks at progress in harmonization and alignment, as part of the discussion of the effectiveness of IDA's assistance at the country level. It builds on previous work showing that the World Bank and IDA are making substantive contributions to progress in harmonization and alignment at the country level. It also highlights areas in which the Bank and IDA could further improve their aid effectiveness and actions to address them. The paper analyzes new developments; assesses their implications at the country, institutional, and global levels; and identifies additional actions IDA is taking to strengthen its role in and contribution to aid effectiveness.

IDA's Role in Enhancing Country-Level Effectiveness
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Summary

In recent years an international consensus-supported by active IDA engagement and leadership-has emerged to strengthen the quality of development assistance. This consensus is framed by the international commitments made under the Monterrey Consensus (2002) and the Rome (2003) and Paris Declarations (2005), and reinforced by the International Roundtables on Results at Marrakech (2004) and Hanoi (2007). Following up on these commitments, partner countries and donors are drawing on a diverse menu of actions to improve aid effectiveness. A number of these actions are being captured through surveys and evaluations.

The results of the 2006 baseline monitoring survey of the 12 indicators in the Paris Declaration show that a growing number of countries are undertaking the necessary steps for alignment and harmonization. However, in half of the surveyed countries, progress is limited and countries and development partners still have many opportunities to improve country-level effectiveness.

The core of IDA's strategy for fostering ownership, alignment, and harmonization at the country level is to establish a supportive policy, incentive, and procedural framework at the institutional level, augmented by corporate oversight through internal review and monitoring. In recent years, the Bank has made substantial changes in its operational policies and procedures. It has also made substantial efforts with other Multilateral Development Banks, the UN system, the European Commission, and other donors to enhance collaboration, reduce transaction costs for clients, and increase effectiveness.

Key aspects of implementing the Bank's commitments on alignment are basing IDA assistance programs on countries' poverty reduction strategies and using IDA programs to help countries strengthen the policies, plans, and institutions needed for development. IDA Results-based Country Assistance Strategies emphasize defining realistic results chains, aligning with the country's long-term vision and priorities, and coordinating with other donor partners on major elements of strategy.

IDA's country-level harmonization actions are many and growing, reflecting country and sector strategies and priorities identified with clients and partners. Contributions include providing analytic leadership in developing common performance assessment frameworks, coordinated budget support, and sector-wide approaches; participating in division of labor exercises and common arrangements for project and program management; sharing information on IDA programs; performing joint diagnostic work and working closely with other donors on joint or collaborative assistance strategies; respecting governments' mission-free periods, and co-chairing donor meetings. Disseminating good practice from one country team to another is also a crucial part of IDA's implementation strategy.

IDA supports the division of labor at the country level through country-led selectivity, including taking more frequently a supporting rather than leading role among development partners. There is a large potential to reduce transaction costs for both partner governments and development agencies from actions in this area. IDA's current approach to an effective division of labor is grounded in efforts for enhanced selectivity in country assistance strategies. Areas and forms of support are determined based on partner countries' views on IDA's comparative advantage and value added in a specific country context. While IDA remains the lead donor for many projects and programs, it is also frequently taking a supporting role when other development partners are in the lead. Notable examples include the education sector in Burkina Faso, where the Netherlands is the lead donor for basic education, while IDA leads on secondary and higher education; Bangladesh where the Asian Development Bank leads support to the education sector by a donor group including IDA; the education sector program in Mali, led by the Agence Française de Développement; and the multi-donor budget support group in Tanzania, chaired on a rotating basis by a bilateral donor.

IDA senior management is committed to improve IDA's capacity and performance in line with the Bank's strategy for harmonization and alignment, and with the international framework embodied in the Paris Declaration principles. Recent surveys provide important feedback for sharpening IDA's efforts to further improve its performance in harmonization and alignment to achieve greater effectiveness at the country level. Harmonization and alignment actions planned and implemented in line with priorities identified at the country level can promote improvements in country effectiveness. IDA's senior management will also continue to promote and support the harmonization and alignment agenda at the international level. IDA's management is on track to achieve the internal and external objectives set out at the time of the IDA14 Mid-Term Review with respect to harmonization and alignment.

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