Japan's Medium-Term Policy on Official Development Assistance (ODA)

IV. Methods of Aid

Implementation of ODA calls for collaboration and coordination among government ministries and agencies, as well as the active utilization of the experience and know-how of the private sector, NGOs, local governments, labor and management groups, and other entities. Likewise, active measures will be taken to promote cooperation and collaboration with other donor countries and international organizations. Furthermore, active support must be given to encouraging and expanding South-South cooperation.

  1. Coordination of ODA Programs within the Japanese Government, among Implementing Agencies and with Various Schemes for Aid

    -- A more effective and efficient system for collaboration and coordination covering the entire government will be created by promoting the sharing of information and a better mutual understanding among government ministries and agencies involved in ODA, through upgrading the level of communications (e.g. the improvement of liaison meetings) among government offices.

    -- The advantages of the various forms of financial and technical cooperation will be optimally utilized while promoting organic interaction among them. In this process, grassroots grant aid deserves special attention as a form of assistance that directly reaches the people of the recipient country. As such, efforts will be made to expand and more effectively utilize grassroots grant aid for projects, while paying due attention to synergy with other forms of assistance.

    -- The implementation of cooperation will be centered on the Japan International Cooperation Agency while fully utilizing the knowledge, know-how, and personnel of various government ministries and agencies. Efforts will be made to achieve effective and efficient collaboration and coordination between the Japan International Cooperation Agency and various government ministries and agencies.

  2. Coordination with Other Official Flows (OOF) and with the Private Sector

    Private-sector trade and investment is playing an increasingly important role in the economic development of developing countries. In light of this fact, due attention will be paid to the following points.

    -- Due attention will be paid to the division of roles and responsibilities with non-ODA other official flows (OOF) *30, trade insurance, and private funds based on their respective objectives, while taking into account the needs and conditions of individual countries.

    -- Efforts will be made to fully utilize the knowledge and know-how of the Japanese private sector in promoting collaboration with the private sector and due attention will be paid to increasing opportunities of Japanese businesses to participate in ODA projects.

    -- With regard to developing countries that have achieved accelerated economic growth and that are experiencing substantial inflows of private funds, projects suited to private-sector investment and OOF will be consigned to such forms of cooperation or activities. ODA will be focused on social development and poverty alleviation and will also emphasize the following points.

    * Assistance will be provided to economic infrastructure projects that are unsuited to private-sector investment or OOF.

    * To promote private-sector investments in projects with strong impacts on development, assistance will be provided to project portions implemented by government organizations in the implementation of tasks deemed necessary for the execution of private-sector initiative projects.

    * Support will be provided for the strengthening of human resources development and policy formulation capacity building that contributes to market economy management.

    * Support will be provided to strengthen industrial structure through the development of small- and medium-sized enterprises.

    * Support will be provided for correcting distortions caused in the process of economic development, including environmental problems and regional disparities.

    -- With regard to developing countries whose private sectors are not fully functional, emphasis will be placed on ODA projects promoting the development of the private sector. Such initiatives would include infrastructure development for improving the investment environment and areas conducive to the development of the private sector, such as the development of institutions and systems, the upgrading of policy formulation capacities, the development of other private-sector capacities, and the development of basic human resources.

    -- The Japan Bank for International Cooperation, to be established in October 1999 through the merger of the Export-Import Bank of Japan and the Overseas Economic Cooperation Fund, will draw on the information and know-how accumulated in both organizations to provide more effective assistance by designing ODA projects to match the social and economic conditions in the recipient countries and the special properties of the ODA project. In this way, the Japan Bank for International Cooperation will endeavor to add to the flexibility and efficiency of Japan's contributions to the international economic community. However, the Japan Bank for International Cooperation will clearly separate its ODA and non-ODA accounts.

  3. Support to and Collaboration with NGOs

    Social development projects, including poverty alleviation and environmental conservation, constitute a steadily increasing share of Japan's overall assistance to developing countries. For this reason, there is a growing demand for finely tuned assistance that directly reaches local populations. Consequently, NGOs have been playing an increasingly important role in the process of economic cooperation and there is a growing need for collaboration with NGOs in the implementation of ODA projects.

    In light of the above, due attention will be paid to the following points.

    -- Efforts will be made to develop a dialogue and exchange views and ideas with NGOs active in developing countries, through such venues as the "NGO-Ministry of Foreign Affairs Regular Consultation Meeting" and the "NGO-JICA Consultation Meeting."

    -- Efforts will be made to increase and enrich ODA support for NGO aid activities.

    -- Collaboration and cooperation with NGOs will be strengthened through various means, such as the contracting-out of projects and the utilization of NGO personnel and know-how.

    -- Support will be provided to strengthen the base of Japanese NGOs involved in the implementation of aid activities.

    -- Efforts will be made to promote the participation of persons with experience in the Japan Overseas Cooperation Volunteers and NGO activities, in the implementation of ODA projects.

       It is necessary to strengthen collaborative relations with local governments that have a wealth of technical know-how and experiences in fields closely linked to everyday life of the people or that are involved in personnel exchanges with developing countries through sister-city arrangements. The active utilization of the know-how of local governments can facilitate more effective assistance and is extremely beneficial in terms of developing public participation in aid activities.

    In light of the above, due attention will be paid to the following points.

    -- Efforts will be made to actively utilize the experience, know-how, and personnel of local governments and to effectively support the cooperative activities of local governments.

  4. Coordination with Other Donor Countries and International Organizations

    In order to achieve greater effectiveness and efficiency in ODA implementation, it is necessary for Japan to develop closer ties of collaboration and cooperation with other donor countries and international organizations. Such initiatives must go beyond the avoidance of redundancy in aid and must aim to achieve significant synergy. In this process, it is also important to assist developing countries to enhance their coordinating capacities as aid recipients.

    In light of the above, due attention will be paid to the following points.

    -- As a leading contributor of funds to international organizations, Japan will endeavor to take greater initiative and to influence the management of these organizations in the direction of its basic policies.

    -- Japan will pursue the possibility of collaboration and cooperation with other donor countries and international organizations in fields where those countries and organizations are especially experienced and enjoy advantages.

    -- With regard to the coordination of ODA programs, Japan will continue to participate in and contribute to existing coordination mechanisms, including sector programs coordination, which center on international organizations, taking into consideration the primary role of recipient countries.*31

    -- Japan will actively promote cooperation through collaboration and the exchange of information and opinions with governments of recipient countries, other donor countries, and aid agencies. Japan will also pursue this objective through bilateral consultation with other donor countries, such as through the Japan-US Common Agenda*32, and through collaboration with international organizations.

  5. Support for South-South Cooperation

    The development of developing countries is a challenge that should be addressed by the entire international community. As such, donor nations should not be limited to industrial countries. Rather, it is desirable for more advanced developing countries and developing countries with adequate experiencies and technologies to actively participate in helping other developing countries. This form of assistance will contribute to bolstering global aid resources and will also stimulate intra- and inter-regional cooperation.
       Development assistance provided by developing countries, or "South-South cooperation,"*33 can be particularly effective in facilitating the transfer of technologies between countries at similar stages of development or that have common backgrounds, such as language and culture. Moreover, South-South cooperation can result in significant cost reductions when undertaken between neighboring countries.

    In light of the above, due attention will be paid to the following points.

    -- Japan will actively support South-South cooperation, as this is a form of international cooperation in which the developing countries are taking the initiative.

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