Updates on Italian ODA

In August, the 2008 ActionAid report on Italian ODA was updated by a 10 pages briefing taking stocks of the main developments the political arena, including the perspective, results and commitments, and new ODA figures available. It can be downloaded at:
http://www.actionaid.it/fileViewAction.do?xclass=Multimediafile&field=file&width=0&height=0&mime=application/pdf&id=23857

Here below, you find some abstracts:

Financial Perspective update
Unlike last year, the new financial perspective 2009-2013 does not include any reference to ODA targets and, more worryingly, at the end of July a Government decree reduces ODA allocation under Ministry for Foreign Affairs by 25% ( -170 million euro) from 2009-2011.

G8 updates
At the G8 Summit in Toyako, Mr. Berlusconi pledged 500 million dollar over the next five year to fund the global response against pandemics. In 2007, at Heiligendamm, Mr. Prodi committed 400 million dollar a year over ten years to fund the same global response.The Italian Sherpa office is already shaping the 2009 G8 thematic agenda, with an expected focus on education in conflict, health, agriculture and water and sanitation.

ODA facts updates
Due to limited and fragmented bilateral country allocations, in 2005-2006, Italy is the first donors only in Argentina and Montenegro, while ranks as second in Suriname and Rep. of Congo and then shifts at the fifth place in Albania, Eritrea, Iraq, Lebanon, Iraq, Nigeria and Tunisia. Italy ranks among the first 10 donors only in 22 partners countries.

Italy has 3.1 billions euro out standing debt, 1.6 billion covered by the HIPC initiative, while 1.5 billions with other counties, including China, Morocco and Argentina.

In 2007, 95% in NGO budget appropriation – 100 million- was committed, showing a significant scale up in administrative absorption capacity. In fact, in 2004, only 72% was committed out of a 73 million allocation. 60% of the arrears due to NGOs was paid off in 2007. NGO proposed initiatives mainly focuses on agriculture (38%) and health (19%). According to the DAC tied-aid definition, 100% of Italian NGOs committed-funds, are tied, due to administrative procedure for aid allocations.

Annual Report on Italian ODA: now available in English

Italy and the fight against world poverty - launched in May 2008 - is the third ActionAid report on Italian development cooperation. It assesses the progress made by Italy in maintaining the commitments undertaken since 2000 in the fight against global poverty. A few months before 2009 Italian G8 Presidency, the report attempts to answer the question whether Italy is ready to lead the G8. Contrary to last year’s report, our findings this year indicate that there are more obvious trends towards improvement, despite the fact that the overall results are still inadequate. T current results are still inadequate and it is very important that more efforts should be made in this direction. The most obvious example is the failure to meet the financial commitments the amount of aid: delays in allocating funds have meant that Italy has deprived the international aid community of 5.2 billion Euros since 2003.

This report assesses the trends and performance of Italian cooperation with respect to shared European objectives and strategies- summarized in the table below.

Sector	Trend	Judgement for 2009
Quantity of aid	Stable – improving in 2008	Inadequate
Phantom aid	Improving	Inadequate
Predictability	Improving	Adequate
Debt	Stable	Adequate
Aid to Africa	Improving	Adequate as regards the bilateral quota Inadequate as regards financial resources
Aid to least developed countries	Worsening	Inadequate
Emergencies	Improving as regards forecasts	Inadequate
Aid to basic social services	Worsening	Inadequate
Trade aid	Stable	Adequate
Coherence	Stable	Inadequate
Tied aid	Worsening	Inadequate
Volatility	Worsening	Inadequate
Fragmentation	Improving	Inadequate

Eventually, ActionAid recommends quick priority actions that could realign Italian cooperation to the European average within a year. Its English version is now available at:
http://www.actionaid.it/fileViewAction.do?xclass=Multimediafile&field=file&width=0&height=0&mime=application/pdf&id=23855

Aid cuts confirmed

Rome, Aug 5th.

The House of Deputies passed a vote of confidence on the omnibus legislation which makes provision also for a reduction in the grant budget of the Ministry of Foreign Affairs. The bill has yet to be published, but, according to the minutes available from the House, AID budget will be shirking by € 170ml in 2009, which accounts for 23% of the resources that were secured at the end of budget cycle last year; the same will happen in 2010.

Long term implications will have to be properly assessed; some experts are implying that the grant budget within the MFA will decline form €732 ml in 2008 to €383ml in 2011. The areas at risk include the GFTAM and voluntary contributions to international organizations (FAO for instance); also, NGOs are very likely to suffer.

Within the space of a few weeks, resources for development cooperation have been subject to legislation tabled by the government and reduced substantially. These measures are in contrast to role that Italy is expected to play as the champion of the fight against poverty in the run up the G8 Summit in 2009.

The budget cycle will be finalised between October and December, when the proper financial and budget bills will be discussed by the Houses. There is still space to right what has been done wrong, by, for instance, commit enough resources to increase the current aid level from a modest 0,19%. Berlusconi has to show whether or not has the profile of an international leader and has the capacity to push the G8 and associates to react consistently to the development crises