３ Efforts to Ensure Appropriate Development Cooperation
Japan’s development cooperation centered on ODA has not only contributed greatly to the development and growth of developing countries, but also to establishing firm bonds of friendship and trusting relations between Japan and developing countries. It has also made a large contribution toward enhancing Japan’s standing in the international community as well as ensuring the peace and prosperity of Japan. On the other hand, there have been cases of fraud committed in ODA projects, failures in delivering expected outcomes and delays due to unforeseen circumstances.
In order to take lessons from these experiences for the future, the Government of Japan has continued making various efforts to improve evaluation systems, enhance transparency, improve project management processes, and hold dialogues with a wide range of stakeholders, including recipient countries and civil society. The Government of Japan will continue to make tireless efforts to implement more effective and appropriate development cooperation.
The Ministry of Finance’s Fiscal System Council raised questions on October 20, 2021 about the funds for the ODA grant aid projects, which JICA keeps from delivery to JICA until their payment to the recipient governments, in accordance with the Act of the Incorporated Administrative Agency-Japan International Cooperation Agency. On November 25 of the same year, the Ministry of Foreign Affairs (MOFA) announced measures for improvement to reduce and optimize the funds.
Following the measures for improvement, the situations of ODA grant aid projects for which a certain amount of time has passed since the decision of implementation will be examined. After the examination, the options of the termination of the projects that do not have a prospect for progress and the return of their funds to the national treasury will be considered. The relevant organizations will further strive for appropriate and efficient execution of grant aid budgets, such as through discussions with recipient governments.
JICA has introduced its Guidelines for Environmental and Social Consideration as a part of its efforts to ensure the appropriateness of its development cooperation and it is striving to implement ODA projects with due consideration for human rights, the environment and social impacts.
(1) Prevention of Fraudulent Practices
Fraudulent practices related to ODA projects not only disturb their appropriate and effective implementation, but also undermine trust in ODA projects that are funded by the public’s taxes. Therefore, fraudulent practices are absolutely unacceptable.
Based on lessons learned from past fraudulent practices, efforts to prevent those practices have been strengthened. These include enhancing monitoring systems (such as “strengthening the function of the Consultation Desk on Anti-Corruption” and “expanding third-party checks”), reinforcing penalties (such as “increasing the maximum period for suspension measures,” “raising the amount of penalty charges for breaching contracts” and “introducing a point-deduction system on corporations that repeatedly commit serious fraudulent practices”) and expanding the scope for suspension measures (such as “including the groups of the corporations on which the measures have been imposed, as well as entities who have received business transfers from the corporations for which the measures have not yet been lifted, in the scope”).
Japan will make continuous efforts to prevent fraudulent practices, under the strong determination that fraudulent practices related to ODA projects are absolutely unacceptable.