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Donor Trends by Donor Types

Donor Trends by Donor Types. PBDD Annual Meeting March 2007 . Bilateral Donors. Aid is increasing: Real terms: 106.78 billion USD (2005) 32% increase from 2004 ODA/GNI: 0.33%/GNI (DAC members’ average) Misleading Administration: 4-8% of total ODA Debt Relief: Over 20% of total ODA

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Donor Trends by Donor Types

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  1. Donor Trends by Donor Types PBDD Annual Meeting March 2007

  2. Bilateral Donors • Aid is increasing: • Real terms: 106.78 billion USD (2005) 32% increase from 2004 • ODA/GNI: 0.33%/GNI (DAC members’ average) • Misleading • Administration: 4-8% of total ODA • Debt Relief: Over 20% of total ODA • Technical Cooperation • Humanitarian Assistance • Project and Program Aid is decreasing: • Only 38% of Total ODA (2005)

  3. Bilateral DonorsAsset Allocation To Who? • Allies: “War on Terrorism”: Pakistan, Indonesia, the Philippines • “Good governance” countries: • Countries with trade ties to donors: Australia, Italy, France To Where? • Afghanistan, Iraq: 37% of new ODA resources from 2000-4 • Nigeria: debt relief • Sub-Saharan Africa: 32.6 % of total ODA (2004)

  4. Bilateral DonorsAsset Allocation (2005)

  5. Bilateral DonorsAsset Allocation To What? Project and Program Aid Breakdown • Social and administrative (2005) • Education: 6.1% • Health: 3.8% • Govt & Civil Society: 9.7% • Economic Infrastructure: 10.2 % • Production: 5.2% Of this, MDG-related ODA: 11.3%

  6. Bilateral Donors Current Trends • ‘Big Push’: idea from the 1950s back in the spotlight • Commitments to increase: 0.7% by 2015 • Aid Concessionality: Since 2000 share of grants up 7% per year • New Aid Architecture • New Distribution Mechanisms: Swaps, PRSPs, PBAs • Partnerships: MDGs as a common goal, Paris Declaration • Untying Aid: DAC agreement to fully untie aid for the LDCs • Supporting Good Governance

  7. Philanthropic Foundations: Origin of Assets Where is the $ coming from? • Increase in the number of wealthy • 691 Billionaires (2005) • 77,500 Families with 30 million + • 8.3 million Millionaires • “Hot” Sectors: • Technology • Finance (Hedge Funds) • Intergenerational transfer of wealth

  8. Philanthropic Foundations: Origin of Assets • Emergence of Foundations Worldwide • US: 38, 807 in 1995, 75,953 in 2006 • Brazil: 157 % increase in Foundations (1996 and 2002) • Emerging Economies: China and India • Increase in Spending • US: $32.4 billion (2004), approx $3 billion to international causes

  9. Philanthropic Foundations:Golden Age of Philanthropy • Expected/Trendy: If you got the money, you got to give/ Want to be on the giving list • Media: Bill and Melinda Gates voted Time Magazine’s People of the Year • Governments: pro-philanthropy policies and tax incentives

  10. Philanthropic Foundations:Asset Allocation To Where? (US data only) • Africa: 19 % of international funding • Europe: 22% of international funding In 2002, 71% of the funding allocated to Western Europe was earmarked for the implementation of international programs orchestrated by Europe-based IOs or research centres (mainly went to Africa in the end)

  11. Philanthropic Foundations:Trends • The “new philanthropist”: young and involved • Under the microscope: increased media & government interest • Business Ethos • Managed like a business: measure those impacts • Leverage: find your niche • Reduce and Rationalize: focus your programs • Hybridization: corporate non-profits? e.g. Google.org, Omidyar Network • International Giving: going up but will overseas regulations (war on terrorism) bring it down? • Partnerships and Networks: very desirable

  12. Private SectorGiving US • Economy Dependent: US in 2004, strong profits in a number of industries resulted in a 13.4 percent increase in gifts to corporate foundations from parent companies • 2002-4: 0.3 decrease in US corporate giving • 2005: Rebounded by 22.5 % • Corporate foundations: 29% of total corporate giving EU • 2005: EU's top 25 corporate foundations 1.7 billion Euros

  13. Private Sector: Asset Allocation Allocation by Sector (2005) • Health and Human Services: 43.47% • International: 18.36 % • Education: 14.11% • Community: 8.33% • Tsunami: 4.7% • Arts and Culture: 3.79% • Environment: 1.37% Corporate International Giving by Region: • 73% to Asia (China 27 %, India 23 %) (US Allocations 2006)

  14. Private SectorTrends • Good for Business • Image: CSR • Opens new markets • Improves community and shareholder relations • Increases labour pool: retention tool • Strategic Philanthropy: Leverage • Impact and Scrutiny: • good for business? • no longer a sleazy slush fund for corporate board members’ pet causes?

  15. RemittancesOrigin of Assets • $167 billion (US) in 2005 • North-South Remittances • 41% increase in outflows from 2001-2005 • US is the largest source: $39 billion (2004) • South-South Remittances • 161% increase in outflows from 2001-2005 • $24 billion (2004)

  16. RemittancesAsset Allocation • Top recipients: China, India, Mexico, and the Philippines • Latin America/Caribbean: 53 billion (2006) • Sub-Saharan Africa: 7 billion (2006) All underestimated because of lack of data

  17. Remittances Trends: • Remittances for Development • Donors: USAID, DFID researching remittances • Recipient countries implementing matching and banking policies to attract and utilize remittances: Mexico, The Philippines, Pakistan, Bangladesh, Sri Lanka and India

  18. Private SectorOrigin of Assets • North America • Canada 8.9 billion (CAD) (2004) • US 199 billion (US) (2004-5) • Europeans and Japanese give primarily through governments Private giving/philanthropy accounts for only 12% of the revenue raised by the civil society sector (Global Average). The majority of funding comes from fees, followed by government grants.

  19. Private Giving Asset Allocation • Global Average: 1% of CSOs active in international work. • Private Giving: Primarily Domestic • Germany: 75% of contributions to top 16 charities went to international dev’t • UK: 25% to international dev’t • Netherlands: 15% to international dev’t • Canada: 4% • US: 2.5 %

  20. Private GivingTrends • Tax carrots and sticks: • Tax carrots: Full Tax Deductions: Australia, Belgium, Denmark, Greece, Ireland, Japan, Netherlands, Norway, Switzerland, UK, US No Tax Deductions: Austria Finland Sweden • Tax sticks: Ceilings: Low ceiling: Denmark (5000 DKK), high ceiling: Canada (60 percent of income) • Overall France’s tax code creates the largest price incentive while those of Austria, Finland, and Sweden offer none • Mega philanthropy: Buffett, Branson • 21 Americans donated at least $100 million to charitable causes, nearly doubling the number that did so in 2005. • Truly wealthy under the eye of the media:

  21. Multilateral DonorsOrigin of Assets (US million, 2005) • Gross Concessional Flows: $ 26,730 million (2005) • Gross Non-Concessional Flows: $ 24,410 million (2005) • Bilateral share to Multilateral Donors: • 30% of Bilateral ODA.

  22. Multilateral Donors Source: DEVELOPMENT AID AT A GLANCE STATISTICS BY REGION 2006 Edition DAC-OECD

  23. Multilateral DonorsTrends • Bilateralization of multilateral aids: donor countries began to use multilateral institutions in the mid-1980s to manage their own bilateral aid programs, primarily by establishing trust funds and co-financing projects. This has reduced the amounts of ‘core’ resources available to multilateral institution, increased the proportion of ‘non-core’ resources provided by donor countries for specific purposes and led to hidden subsidies as donors rarely pay the full administrative costs associated with the use of non-core resources. • Banks in the Black: World Bank and the three major long-established Regional Development Banks have moved over the past decade to a position where not only do they no longer require capital increases but they are also routinely spending less than they are receiving

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