Official Development Assistance (ODA)

What is ODA?

Official Development Assistance (ODA) is the term used to refer to what most people would call aid.
To be counted as ODA, public money must be given outright or loaned on concessional (noncommercial) terms, and be used to support the welfare or development of developing countries. - Organization for Economic Cooperation and Development

What is ODA?

Official development assistance are resource flows provided by bilateral sources and multilateral institutions with the objective of promoting the economic development and welfare of the recipient country.
Behind this altruistic intention, however, ODA has been used as an instrument of foreign policy of more developed countries to advance their political and commercial interests. - National Economic and Development Authority

What is ODA?

ODA is a loan or loan and grant administered with the objective of promoting sustainable social and economic development and welfare of the Philippines.
- Republic Act 8182 - Official Development Assistance Act of 1996 (Section 2a)

What Makes ODA Unique?

Concessional in nature

To qualify as ODA, the money given by the donor country/institution should have a grant component of at least 25%.

Offered below market rates

Compared to government bonds or ordinary loans given by banks or international financial institutions, accompanied by longer payment periods.

Types of ODA
According to terms of assistance

Soft Loans

have interest rates, which may range from zero to seven percent, maturity periods ranging from ten to 50 years and grace periods of five to ten years.

Grants

has no repayment obligation and are mainly provided in the form of experts, consultancy services, equipment, commodities and training.

Types of ODA
According to donor

Bilateral

flows from official (government) sources directly to official sources in the recipient country.

Multilateral

core contributions from official (government) sources to multilateral agencies where it is then used to fund the multilateral agencies own programmes.

Legal Basis in the Philippines

Official Development Assistance Act of 1996 (RA 8182)

Defines what qualifies as ODA in the Philippines Exludes ODA from the foreign debt limit (amending RA 4860) Specifies what programs and projects may qualify for ODA Establishes oversight mechanisms for monitoring and evaluation for ODA-funded projects

What Qualifies as an ODA Project?

It should be used to achieve equitable growth and development in (all) provinces

Improvement of economic and social service facilities Priority to countryside development, rural infrastructure and economic zones under the PEZA Project should be previously identified as a national priority which is urgent or necessary ODA should not be used solely for convenience, availability or accessibility

Monitoring and Oversight

National Economic and Development Authority (NEDA)

annual review of the status of all projects financed by ODA, identify causes of delays, reasons for bottlenecks, cost overruns, both actual and prospective, and continued viability

Commission on Audit

audit on each ongoing and completed project

Congressional Oversight Committee

Any agency of the national government, including GOCCs, may implement an ODA-funded project (RA 8182 IRR, Sec. 2.1b) Counterpart funding for each project must be included in the annual General Appropriations Act in every fiscal year. Whenever possible, Filipinos and Filipino goods and services should be preferred through-out the implementation of the project, unless the President waives or modifies it in agreement with the donor institution (RA 8182 Sec. 6.2, RA 8555, Sec. 1)

ODA Programming Process

Country Program Review

Project Identification

Pipelining of Projects

Implementation

Donor Appraisal And Approval

ICC Evaluation And NEDA Approval

Donor Institutions in the Philippines

Asian Development Bank (ADB)

European Union (EU)

World Bank
International Monetary Fund United Nations (UN) and related agencies Country-specific donor agencies (US AID, JICA, GIZ, AusAID, etc.)

New school buildings at Datu Embak Mangansing Memorial High School, Pikit, North Cotabato (JICA)

Microenterprise Access to Banking Services-4 (MABS-4) Program (USAid)

E-Trikes Project (ADB)

Current ODA Disbursements

Resources

NEDA Microsite on ODA: http://www.neda.gov.ph/subweb/oda/ODA/oda.h tm

OECD Definition of ODA: http://www.oecd.org/dac/stats/faq.htm

RA 8182 (including IRR):

Data on ODA implementation: http://www.aidflows.org/

http://www.neda.gov.ph/progs_prj/oda/odaAct.htm

Resources

NEDA Microsite on ODA: http://www.neda.gov.ph/subweb/oda/ODA/oda.h tm

OECD Definition of ODA: http://www.oecd.org/dac/stats/faq.htm

RA 8182 (including IRR):

Data on ODA implementation: http://www.aidflows.org/

http://www.neda.gov.ph/progs_prj/oda/odaAct.htm