UNDP RESOURCES TRENDS & DIRECTIONS DRM/Partnerships Bureau RBEC DRR/DCD MEETING 17 DECEMBER 2008

1. UNDP RESOURCES TRENDS & DIRECTIONS • DRM/Partnerships Bureau • RBEC DRR/DCD MEETING • 17 DECEMBER 2008

2. Overall resources picture • Composition of Resources • Sources/Contributors • Past Trends • Future Direction – SP Ambition – Changing Aid Environment

3. UNDP - Overall resources picture • 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

4. Growth in UNDP Income 1992 - 2007 Multilateral resources Bilateral donor resources Local resources Administered funds Regular resources

5. Growth in UNDP Income 1992 - 2007 Source: UNDP

6. 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

7. UNDP Core vs Total ODA Source: OECD and UNDP

8. Top 10 Donors to UNDP Core: 2007 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%

9. Concentration of Core in UNDP/UNICEF/WFP

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

11. 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

12. UNDP Non-Core vs Total ODA Source: OECD and UNDP

13. Concentration of Bilateral Non-Core Top 10 Donors in 2007

14. Concentration of Multilateral Non-CoreTop 5 donors in 2007

15. Concentration of Bilateral and Multilateral Non-CoreContributions to UNDP% Share of Top Recipient Countries

17. ‘Non-Core’ to RBEC Region: 2005 – 2007 (US $ million)

18. LOCAL RESOURCES in 2000 and 2007 2000: $934.36 million 2007: $1,265.82 million Source: IMIS

19. 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)

20. Comparison Trust Funds vs. Cost-Sharing Trust Fund Cost-Sharing Purpose Funding 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 Requires the designation of Trust Fund Manager Use of donor contributions is normally limited to the duration of a particular project. Other

21. Elements of a Changing Aid Environment • Overall Aid Picture • Non-DAC Aid Flows • Increasing Prominence of NGOs • High-Profile Foundations

22. 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

23. Non-DAC Aid Flows – Pieces of a Puzzle • 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

24. Net ODA Flows from reporting non-DAC Countries(millions of current US dollars) Source: OECD DAC. 2007. Final ODA flows in 2006

25. 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

26. UNDP and the Changing Aid Environment • 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)