SWEDEN'S FOREIGN AID REFORM

UNCLAS SECTION 01 OF 02 STOCKHOLM 000342

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TAGS: EAID ECON ECIN EFIN PGOV SW
SUBJECT: SWEDEN'S FOREIGN AID REFORM

REF: STOCKHOLM 204


1. Summary: Swedish Minister for International Development
Cooperation Gunilla Carlsson told journalists on May 7 that
Swedish assistance still has a "long way to go" when she
presented a comprehensive report of development assistance.
She commented that Sweden must prepare and monitor programs
more efficiently. Carlsson said Sweden will:

- facilitate better measurement and evaluation of the impact
of development aid,

- focus on results rather than targets,

- task SIDA to set up a unified system for evaluation of aid
efforts and risk analysis by October 1,2009,

- exert greater control over support to multilateral
organizations,

- increase international cooperation with donors to perform
evaluations.

End Summary.

Background
--------------


2. Sweden has one of the largest assistance programs in the
world and is setting aside $4.3 billion for international
development cooperation in the 2009 budget. In 2008, Sweden
was ranked as number two in a "Commitment of Development
Index" by the Center for Global Development (the U.S. ranked
number 17). The Organization for Economic Cooperation and
Development (OECD) ranked Sweden as number one in the world,
with an aid volume as a proportion of Gross National Income
(GNI) of 0.98 percent in 2008, according to preliminary
statistics.


3. In 2007, the latest year for which full figures are
available, Sweden contributed some $3.6 billion in official
development assistance, which corresponded to 0.93 percent of
GNI. The top four recipient countries of Swedish aid are in
Africa with Afghanistan ranked at number five. While the
Swedish MFA sets the overall amount of development
assistance, SIDA has traditionally enjoyed a great degree of
independence in determining how and where the money is spent.
The current center-right alliance government will be
watching SIDA much more closely to ensure Sweden's aid money
achieves positive results.



4. After having spent a few years on tougher prioritizing,
such as limiting the number of countries receiving
development aid, and more efficient structures, Swedish
Minister for International Development Cooperation Gunilla
Carlsson now aims to facilitate better measuring and
evaluation of the impact of development aid. On May 7,
Carlsson presented the first ever comprehensive report of
bilateral and multilateral development assistance performance
to the Parliament. The findings of the 150-page report
present a thorough account of what Sweden's extensive foreign
aid programs have achieved.

Must learn from our mistakes
--------------


5. Carlsson told journalists that Sweden must learn from its
mistakes. Swedish development assistance has not been
successful on all counts, according to Carlsson. "There are
many good examples of development assistance initiatives that
have made a difference to people's lives, but we still have a
long way to go before we have development assistance that we
can prove leads to long-term results," Carlsson opined.


6. To help achieve this, Sweden has trimmed the number of
countries receiving development assistance from over 120 to
slightly more than 30, and SIDA is to set up a unified system
for evaluation of aid efforts and risk analysis by October 1,
2009, according to Swedish Director-General of International
Development Cooperation Jan Knutsson. Knutsson underscored
Carlsson's statement, adding that in addition to focusing on
results rather than meeting targets, such as one percent of
GNI, Sweden will concentrate on integrating political,
civilian and military efforts more efficiently in conflict
countries.


7. In 2007, the government began implementing more stringent

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monitoring and evaluation procedures designed to use
performance data to make Swedish assistance more focused and
more effective. Carlsson said the inaugural report shows the
difficulties involved in describing the long-term effects of
Swedish assistance activities, and that Sweden must learn
from its mistakes. "We have not been sufficiently focused on
results nor have we prepared and monitored programs and
projects sufficiently," Carlsson opined. She added that
Sweden has failed to pay enough attention to how projects
improve quality of life for the poor.

Strengthen performance culture
--------------


8. Carlsson opined that it is impossible in many cases to
establish a causal connection between a specific activity, or
to change and identify a positive connection between
development assistance and development itself. She stated
that this inaugural report will enable Sweden to improve its
performance reporting to Parliament and improve the
management of development assistance. The government has
urged SIDA to strengthen its "performance culture" by
establishing a uniform system for results-based management
and by focusing on expected and actual performance in the
preparation and implementation of individual aid programs.


9. Carlsson commented that Sweden also needs to exert greater
control over support to multilateral organizations and
increase international cooperation with donors to perform
evaluations. Anders Bengtcen, Head of Department for
Multilateral Development Cooperation at the MFA, stressed
that Sweden uses up to 30 different indicators to evaluate
Sweden's cooperation with multilateral organizations and is
working hard to get Swedish representatives on the boards of
these organizations.


SILVERMAN