Donors, Neo-Liberalism and Country Ownership in Southeast Asia

Authored by: Andrew Rosser

Routledge Handbook of Southeast Asian Politics

Print publication date:  December  2011
Online publication date:  March  2012

Print ISBN: 9780415494274
eBook ISBN: 9780203155011
Adobe ISBN: 9781136579196

10.4324/9780203155011.ch11

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Abstract

During the 1990s and early 2000s, much of the scholarly and policy-oriented literature on aid effectiveness suggested that aid had done little to promote economic growth in developing countries or had had a positive impact on growth only in countries that had ‘sound’ policies and institutions (Dollar and Pritchett 1998; Burnside and Dollar 2000; Easterly 2006). At the same time, several scholars produced evidence to suggest that policy conditionality had been ineffective in promoting economic policy reform in developing countries – in one influential study, for instance, Dollar and Pritchett (1998) found that conditionality did not guarantee that reforms would be carried out, or be successful or sustainable once they were. The result was a new consensus that policy conditionality needed to be reduced or even abandoned in favour of greater country ownership of aid programmes if aid was to become more effective in promoting economic growth in developing countries. In March 2005, this new consensus led to donor governments and the international financial institutions (IFIs) – that is, the World Bank, the International Monetary Fund (IMF), and the regional development banks – (hereafter referred to collectively as ‘donors’) signing the Paris Declaration on Aid Effectiveness (hereafter the Paris Declaration) along with a host of leading development NGOs and governments from many aid recipient countries. This declaration lists country ownership as the first of five key principles of aid effectiveness, the others being alignment, harmonization, managing for results and mutual accountability. It also outlines a series of measures aimed at realizing the principle of country ownership (and the other principles) in practice and sets specific related targets for donors and aid recipient countries to achieve within specified timeframes (OECD-DAC 2005). In September 2008, the signatories to the Paris Declaration reiterated their support for greater country ownership at the 3rd High Level Forum on Aid Effectiveness in Accra, Ghana, and committed to further measures aimed at realizing this principle in the Accra Agenda for Action (OECD-DAC 2008a). Indeed, the Accra Agenda for Action arguably gave greater prominence to the notion of country ownership, noting that it was the international development community’s ‘first priority’ with regards to aid effectiveness.

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