{RE-}EMERGING AS DONOR Russia’s Participation In Global Development Cooperation

1. {RE-}EMERGING AS DONORRussia’s Participation In Global Development Cooperation Alexander Alimov Department of International Organizations Ministry of Foreign Affairs of the Russian Federation

2. Russia: long history of engagement • Russia being the Soviet Union successor has a long history of engagement in development cooperation • USSR: one of the world’s major donor states and creditors • considerable amounts of external assistance • aid policy largely determined by ideological considerations, granted to countries, which declared their “socialist orientation” • significant contribution to development of many countries • necessary institutional arrangements in place • 1990sRussia: transformation to a recipient of international aid • “exodus” from recipient countries • no new conceptual policy framework for international assistance • no special decision-making body set up to ensure implementation of such a policy • USSR legacy, including debt assets and liabilities • financial and technical support from international financial organizations, UN system, bilateral pertners • 2000s: back to a donor .

3. Back to donor status • graduation from the role of a recipient of international assistance, attainment of the MDGs domestically through own efforts and at own expense • search for an optimum balance between the need to address domestic issues and the need to increase participation in international efforts to support development • commitment to the global partnership for development as set out in the Millennium Declaration, the Monterrey Consensus, the Johannesburg Plan of Implementation and the 2005 World Summit Outcome • recognition of the centrality of mobilizing financial resources and their effective use to a global partnership for development in support of the achievement of the internationally agreed development goals, including the MDGs • strong support of multilateralism and the United Nations • UN Security Council Permanent Member • Group of Eight member and President in 2006 Development assistance activity restarted

4. Russia as Development Assistance Donor FactualSituation • Federal Budget factual expenditures for development assistance 2005 - USD 97 million2006 – to USD 100 million.Total amount of commitments taken in 2006 for the next 3-4 years - USD 250 million • Debt relief: Russia has cancelled or committed to cancel USD 11,3 billion of debt of African countries, including USD 2,2 billion of the outstanding debt of eligible heavily indebted poor countries under HIPC initiative • Financial support to international initiatives: • Global Fund to Fight AIDS, Tuberculosis and Malaria: USD 40 million pledged for 2002-2008, USD 217 million, which would be distributed to fund projects in Russian Federation, will be reimbursed to the Fund • Global Polio Eradication Initiative: USD 18 million pledged for 2003-2008 • Global Plan of Action to Fight the Bird Flu and Pandemic Flu: USD 44,7 million pledged • International Energy Partnership Fund “Global village”: USD 30 million pledged • “Education for All” Initiative: USD 7,2 million pledged

5. Russia as Development Assistance DonorFactualSituation • Voluntary contributions to UN funds, programmes and specialized agencies have been increased, in some instances doubled (WFP – USD 11 million, UNHCR – USD 2 million, UNDP – USD 1,1 million, UNICEF - 1 million, UN-Habitat - USD 0,4 million, UNFPA – 0,3 million,) • Contribution to IDA replenishment for 2003-2014 – USD 80 million • Contribution to several IMF programmes – around USD 50 million • Work is underway to make contributions to the Central Emergency Relief Fund (CERF) and the Peace-Building Fund • Innovative sources of financing: • Advance Market Commitments (AMCs) on vaccines

6. Russia as Development Assistance DonorFactualSituation • Emergency humanitarian assistance to countries, which have been victims of natural and man-made disasters: over USD 55 million for last five years • USD 30 million of targeted humanitarian, technical and medical aid in the beginning of 2005 to Asian and South-East Asian countries affected by the catastrophic tsunami • Iran, Pakistan, Lebanon, Algeria, Angola, Mali, Sudan, Cuba, Bolivia, Mexico, Ecuador • Training of specialists for CIS countries and developing states: about 8 thousand foreign students in Russian higher education institutions Target for future – USD 500 million per year

7. Russia as Development Assistance Donor:Profile • In absolute amounts Russia is far behind developed donor-countries • Russia is not OECD DAC member • Debt relief dominates over all other assistance flows • Multilateral channels: more emphasis on the BWI than on UN development system • Russia - both donor and recipient • Russia – a higher middle-income country with GNI per capita USD 4,650 in 2005 • Significant regional disparities – challenges to achieve the MDGs in some regions: HDI in Russian regions that are lagging behind is comparable to that of developing countries • Russia has its own debt obligations Gradual phasing out of international assistance Enhancing its own development cooperation

8. Enhancing development cooperation: Challenges • Need for a comprehensive and coherent system: • Responsibilities are spread across different ministries • Steps taken are fragmented • Absence of a National Development Assistance Agency • Lack of conceptual basis and well-designed long-term strategy • Legal and regulatory frameworks need to be improved • The concept of ‘international development assistance’ including the term ‘ODA’, is still not included in the Budget code of the Russian Federation, other federal laws and the federal budget • Cumbersome Budgeting Process • Specific Government ordinance/regulation is needed for every budget expenditure • Hard-to-get approval of the Finance Ministry • Insufficient institutional capacity of relevant ministries • Infrastructure for providing bilateral assistance still to be developed

9. Way ahead:National Development Assistance Mechanism • Ensuring political will at the highest level • In May 2005 the President of the Russian Federation set the task of creating an effective development assistance mechanism. • Further elaboration of the conceptual as well as regulatory and legal framework • Concept of Russian Federation’s International Development Assistance • Amendment of the Budget code of the Russian Federation • Institution building, improving operational effectiveness and efficiency • Improving coordination among relevant Government agencies • Creating a working inter-ministerial mechanism for project approval and formulating proposals for budget allocations • Involving non-government stakeholders, including private sector • Involving regional authorities – long term perspective • Mobilizing public support • Seeking for further increase in volume of assistance • Increased contributions to UN funds and programmes

10. Concept of Participation in International Development Cooperation • Prepared by MFA and Ministry of Finance • Main elements agreed by the Government in November 2006 • To be presented to the President of the Russian Federation • Sets the principles, goals, forms and priority areas of Russia’s international development assistance • Outlines conceptual, regulatory and legislative basis of the national system of international development assistance and of the mechanism for planning and managing the external aid

11. Role of UNDP: RUSAID Project • 2004-2005 – joint UNDP Russia and MFA preparatory assistance project “Russia as Emerging Donor. Strategic Research, Consultations and Training” • 2006 – full fledged project aimed at providing practical assistance to the process of building up Russia’ s ODA agency/mechanism, including through: • Provision of advisory services to the appropriate government ministries, involved in the preparation of the concept on Russian development cooperation policy and establishment of a national development assistance mechanism; • Enhancing coordination and interaction between the relevant Russian government agencies and establishing partnership with the non-government stakeholders, including academic institutions, civil society and the corporate sector; • Establishing the information exchange and cooperation channels with other ODA agencies or structures worldwide • Support to the specific pilot initiatives aimed at realization of Russia’s donor capacity; • Elaboration of the basic principles, main elements and structure of Russian development assistance agency/mechanism and working out concrete proposals related to the establishment of the national ODA agency for the Government’s consideration.

12. Role of UNDP • The Ministry of Foreign Affairs is the Executing Agency of the project on behalf of the Russian Government • Government expectations for the project: • Enhanced institutional, staffing and technical capacity within the respective Government entities to support the establishing of the national TA agency/mechanism; • Establishing a mechanism for funding JPOs and other national experts for assignment within the UN System elsewhere; • Exploring links between the ODA agenda and Russia’s G-8 chairmanship in 2006; • Learning, adapting and replicating international best practices and lessons learned; • Joint resource mobilization efforts including close collaboration with the corporate sector; • Transparent resources and results management; • Access to the international fora and events and communications with ODA agencies worldwide.

13. Role of UNDP • Mainstream the activity to support emerging donors’ efforts into UNDP’s major strategic planning documents • No appropriate service line in the MYFF for 2004-2007 • Mechanisms and regulations governing resource mobilizations should be conducive to increased contributions from the emerging donors • Possibility for tied-upcontributions • More active promotion of the thematic trust funds • Attractive recovery rates • Active domestic resources mobilization for UNDP country programmes • Concrete project proposals to be presented regularly to interested Governments • Quick impact MDG related projects within and beyond region • Provide platform for regular information exchange and enhanced cooperation among emerging donors

14. Thank you