OECD Report - DAC and Non-DAC Concessional Financing for Education
1. At the Arab-DAC Dialogue in 2016, Arab countries and institutions and DAC members
set up a joint task force on education. Since then, the Islamic Development Bank,
Norway and the United Kingdom, with support from the OECD, have been discussing
how to accelerate access to quality education in developing countries. The purpose of
this note is to understand, using the OECD statistical database, the main volumes and
trends in concessional financing for development in the area of education, which
complements the analyses performed by other actors, notably the Global Monitoring
Report or the Report of the Education Commission. The note also provides
information on OECD work in the field of education.
The education sector
is underfunded, even
if ODA to the sector
stood at USD 9.7
billion in 2016 with
the lionâs share being
provided by DAC
members
ï· Domestic resources are the principal source of finance for
education (90% of the total) in developing countries. In addition,
USD 9.7 bn in Concessional Development Resources
supported progress towards the Sustainable Development
Goals that target education in 2016. However, external
funding for education remains insufficient compared to the
needs (estimated at USD 39 billion per annum in 2015-2030 by
UNESCO).
ï· DAC providersâ ODA to education increased by 12.4% between
2011 and 2016, while ODA from Arab donors concessional
finance from Arab institutions to the education sector doubled
over this period.
ï· Over 2013-15, private philanthropiesâ flows to the education
sector in developing countries amounted to over USD 2 billion
on average per annum.
DAC and non-DAC concessional
financing for education
These statistics are based on Arab and DAC providersâ reporting to the OECD. Summary statistics for these and
other providers of development co-operation and, when available, project-by-project data can be found at:
www.oecd.org/dac/financing-sustainable-development and www.oecd.org/dac/stats/non-dac-reporting.htm. The
figures presented here exclude scholarships and indirect imputed student costs, as well as the unallocated
budget support that could be imputed to education. The flyer also provides a more granular analysis of education-
related humanitarian assistance flows. The information regarding philanthropies comes from an OECD survey
comprising data from 2013 to 2015.
2. January 2019 âą OECD Development Co-operation Directorate
Arab and DAC
providers target
middle-income
countries in Sub-
Saharan Africa and
fragile states, where
the needs are
greatest
ï· Arab and DAC members targeted their education
Concessional Development Finance to Sub-Saharan Africa.
An estimated 43% of DAC providersâ ODA to the education sector
disbursed between 2011 and 2016 was directed towards fragile
contexts, while Arab providers directed 64% of their ODA over
that period.
ï· Over 2011-16, an annual average of USD 444 million was
disbursed by all providers towards education-related
humanitarian ODA, representing 2.8% of all humanitarian
assistance (below the 4% target globally agreed).
ï· Arab countries and institutions and DAC members mainly
targeted middle-income countries (70.4% and 43%
respectively) in their ODA to education between 2011 and 2016.
The OECDâs
Programme for
International
Student Assessment
(PISA) is
increasingly
supporting Arab
countries
ï· The OECD Programme for International Student Assessment
(PISA) allows governments and educators to identify effective
policies that can be adapted to their local contexts. PISA gathers
data on learning, essential information to implement the SDGs.
ï· The OECD also has developed PISA for Development, which
focuses on making PISA more accessible and relevant to low-
and middle-income countries, as well as on enhancing PISA
instruments to target average levels of student performance and
to building capacity to manage large-scale assessments in those
countries.
TRENDS IN OFFICIAL DEVELOPMENT ASSISTANCE TO EDUCATION
There has been significant progress in the education sector in the worldâs poorest countries since
the year 2000. Primary school net enrolment in developing countries rose from 83% in 2000 to
91% in 2015. The number of out-of-school children almost halved, from 100 million in 2000 to
around 57 million in 2015 â most of these children are still in low
and lower middle-income countries. Global literacy rates among
youth aged 15-24 rose from 86% in 1990 to 91% in 2015, and the
gap between young men and women was reduced. Despite
commendable progress in universal access to education,
developing countries still account for 95% of out-of-school children.
Furthermore, 250 million primary school aged children are not able
to read, write or count well enough to meet minimum learning
standards.1
1
MDG Monitor (2017), see: www.mdgmonitor.org
3. January 2019 âą OECD Development Co-operation Directorate
Chart 1. Trends in total ODA to education
2011-16, gross disbursements and commitments,
USD billion, constant 2016 prices
The Sustainable Development Goals (SDGs)
could usher in a transformative shift in
developing countries, as the goals encompass
economic, social and environmental dimensions
that will promote sustained growth and shared
prosperity. Hence, SDG 4 enjoins policy makers
to âensure inclusive and equitable quality
education and promote lifelong learning
opportunities for allâ.
One tool to achieve the SDGs is Official
Development Assistance (ODA).2
ODA
disbursements to the education sector from all
providers of development co-operation reached
USD 9.7 billion in 2016. UNESCO estimates the
needs of the education sector at USD 39 billion
per annum in 2015-2030. In other words, there
is a substantial funding gap for education.3
Notwithstanding, it is important to mention that
according to the Education Commission,
external concessional financing represents
under 10% of education expenditures in
developing countries, while the remaining 90%
stems from domestic sources. These resources
are on an upward trend thanks to increases in
tax revenue but education is not always being
prioritised, while education budgets are not
reaching those with the greatest need. The
household costs of education in developing
countries continue to place a disproportionate
burden on the poorest who cannot afford to
send their children to school.
MAIN PROVIDERS OF ODA AND CONCESSIONAL DEVELOPMENT FINANCE TO
THE EDUCATION SECTOR
This note covers DAC members, as well as 20 bilateral providers that report to the OECD (which
are not members of the DAC) and 35 multilateral organisations. Regarding the Arab countries and
institutions, the note includes activity-level data from the Arab Fund for Economic and Social
Development, Islamic Development Bank and the OPEC Fund for International Development. The
OECD also receives activity-level data from the United Arab Emirates (which includes the Abu
Dhabi Fund for Development) and Kuwait (including the Kuwait Fund for Arab Economic
Development). The note draws on these Arab development finance flows, which inevitably
only provides a partial picture of total Arab ODA flows.
2
For a discussion on how effective is education ODA, see Riddell and Niño-ZarazĂșa (2016), âThe effectiveness of foreign aid to education. What can be
learned?â, International Journal of Educational Development 48(1): 23-36.
3
UNESCO (2017), Global Education Monitoring Report, Paris: UNESCO. Available online at: http://unesdoc.unesco.org/images/0024/002495/249568e.pdf.
See also the report of the Education Commission (2017), The Learning Generation, available at: http://report.educationcommission.org/wp-
content/uploads/2016/09/Learning_Generation_Full_Report.pdf
The OECD development finance database
contains detail of almost 9,000 education-
related ODA activities per year. This note
focuses on the period 2011-16, a period when
ODA to education was stable after hitting
record levels in 2010.
4. January 2019 âą OECD Development Co-operation Directorate
DAC members disbursed the lionâs share of concessional development finance for education
between 2011 and 2016: an annual average of USD 6 billion (73.3% of total education
concessional finance). Non-DAC providers disbursed an annual average of USD 127 million
between 2011 and 2016 for education, with the Arab bilateral providers (for which information is
available) disbursing USD 117 million. Multilateral agencies also provided USD 2.1 billion on
average over that period (25.2% of total education ODA), of which Arab multilateral agencies
disbursed USD 29.6 million. Bilateral and multilateral Arab providers represented 1.7% of total
education ODA. These ODA flows to the education sector represented 9.1% of total sector
allocable ODA for DAC members and 4.8% for Arab providers.
Table 1 ranks the main providers of
concessional finance to the education sector
between 2011 and 2016. A number of
providers have significantly increased their
ODA to education in recent years, notably the
UAE, which is a strong advocate of education
(416% increase over that time period, see Box
1), Kuwait (141% increase), Estonia (136%
increase) and Norway (96%) â although,
except for Norway, these providers started
from relatively low education ODA levels.
Among the Arab providers, the OECD captures
data on the United Arab Emirates and Kuwait
with important volumes of ODA in education in
2016 (USD 149 million and USD 44 million,
respectively). Arab institutions decreased their
flows disbursed to the education sector by
44.2% over 2011-16. In 2016, the International
Development Association, the United States
and the United Kingdom were the top 3
providers of education-related concessional
finance, providing over USD 4.1 billion over
that period.
The OECD also collects data on philanthropic
institutionsâ spending on education in
developing countries for the period 2013-15.
During this period, philanthropies provided over
USD 2 billion to the education sector,
representing 10% of total sector allocable
philanthropic flows. The main sub-sectors
targeted were education policy and
administrative management (26%) and higher
education (26%). The main providers were the
MasterCard Foundation (USD 301 million), the
Vehbi Koç Foundation (USD 165 million) and
the IKEA Foundation (USD 142 million) while
the main recipients were India (14%) and
Turkey (11%).
Table 1. Top 10 providers of concessional
finance for education
2011-16 average, gross disbursements and commitments,
USD billion, constant 2016 prices
Provider Amount Share
International Development
Association
1 254 15%
United Kingdom 1 123 14%
United States 1 051 13%
Germany 665 8%
EU Institutions 623 8%
Japan 420 5%
France 372 4.5%
UNRWA 365 4.5%
Australia 335 4%
Norway 250 3%
Total 6 460 79%
Box 2: The Global Partnership for Education (GPE)
The GPE is a global fund and a partnership focused on
education in partner countries. The partnership has a
unique role to agree standards for education planning
and policy-making and to mobilise development
financing from public and private providers to support
and monitor the implementation of those plans.
The GPE has recently launched its 2020 replenishment
effort and taken steps to be better reflected in the
OECD Creditor Reporting System. Over 2014-2017,
the GPE channelled USD 2 billion of the total education
ODA for that period.
Box 1: The United Arab Emirates Policy for Foreign
Assistance (2017-2021)
The UAEâs foreign assistance policy aims to contribute
to global efforts to achieve the SDGs, notably towards
achieving SDG Goal 4 on education. For example, the
UAE will support education of civil servants from
developing countries or will support executive
education courses for women in developing countries.
5. January 2019 âą OECD Development Co-operation Directorate
GEOGRAPHICAL TARGETING OF EDUCATION CONCESSIONAL FINANCING
Looking at all concessional finance flows to the education sector between 2011 and 2016,
providers targeted regions most in need: Sub-Saharan Africa received 27% of total ODA to the
sector, while South and Central Asia received 24%. The poorest countries (least-developed and
other low-income countries) received 36%.
Focusing on DAC members, excluding the flows to âunspecified developing countriesâ (18% over
2011-16), they targeted Sub-Saharan Africa (33% over 2011-16) followed by South and Central
Asia (22% over 2011-16). Their main recipients were Afghanistan, Pakistan, Ethiopia, Indonesia
and Bangladesh. The top ten recipient countries represented 36% of total financing to the sector
(see Chart 2 and Table 2).
If we look at Arab providers, they targeted Sub-Saharan Africa (31%, increasing over time), the
Middle East (27%) and North Africa (22.5%). Egypt, China, the West Bank and Gaza Strip,
Pakistan and Jordan were their main partners.
Chart 2. All donors regional allocation of
education ODA
2011-16 annual average, gross disbursements
Note: Percentages next to country labels represent shares of total
education ODA to all developing countries.
Table 2. All donorsâ top 10 recipients of
education ODA
2011-16 annual average, gross disbursements, USD million
Partner Amount Share
Pakistan 488 5.8%
India 438 5.2%
Bangladesh 410 4.9%
Ethiopia 316 3.8%
West Bank and Gaza
Strip
311 3.7%
Afghanistan 301 3.6%
Jordan 225 2.7%
Indonesia 214 2.5%
Viet Nam 169 2%
Morocco 150 1.8%
Total 3 025 35.9%
The Middle East and North African (MENA) region received an annual average of USD 1.2 billion
between 2011 and 2016 for the education sector, of which 29.5% was provided by the United
Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA), 14.7% by
the European Union and 12% by the United States. Arab countries and institutions disbursed 5.3 of
total concessional finance flows going to the education sector
in the MENA region â well above their relative contribution to
the sector in all regions. Their main partners were Egypt (14%
of total education ODA from Arab providers), the West Bank
and Gaza Strip (10%), Jordan (9%) and Morocco (5%). These
flows mostly financed basic education (55%).
6. January 2019 âą OECD Development Co-operation Directorate
Importantly, all providers are focusing on fragile contexts.4
The share of education ODA flows
targeting these contexts was stable over 2011-16 (42.8% of total education ODA, while for Arab
providers this figure represented 64%). Beyond developing skills, education can accelerate
development in fragile contexts; so increased attention is needed to education and fragility issues.5
Further research could explore the issue of how education ODA is distributed, more generally,
across countries and regions (e.g. looking at how the proportion of out-of-school children living in
each region is related to ODA distribution).
Chart 3. Income group breakdown of education ODA
2011-16 annual average, gross disbursements
DAC members Arab providers
Note: The âunspecifiedâ category is used when the country targeted cannot
be identified.
Most Arab and DAC education-related
activities focus on middle-income
countries (MICs), which received 70%
of total Arab ODA flows (USD 103
million, mainly to lower middle-income
countries, with USD 66 million) and
43% of DAC ODA flows (USD 2.7
billion).
Low-income and least-developed
countries (LICs and LDCs) received
34% of education ODA from DAC
members and 29% from Arab
countries and institutions, on average
over 2011-16. Education ODA is
essential in least-developed and low-
income countries where ODA can
contribute to educational
development.6
EDUCATION SUB-SECTORS TARGETED BY ARAB AND DAC ODA
For DAC providers, basic education accounts for 38% of total education ODA over 2011-16, while
it only accounts for 7% of education-related ODA of Arab providers. ODA investments in basic
education increased by 30% over 2011-16 in DAC members (while the share in total education
ODA increased over that period surpassing the amounts of 2011). ODA investments to basic
education increased by 142% among Arab providers over that period (with their share in total
education ODA remaining stable). Support to secondary education increased in DAC providers
over 2011-16 by almost a factor of two, while decreased by 32% among Arab providers.
4
According to the latest OECD States of Fragility Report (2018), fragile states include the following countries: Afghanistan, Angola, Bangladesh, Burkina
Faso, Burundi, Cameroon, Central African Republic, Chad, Comoros, Congo, Cote dâIvoire, Democratic Peopleâs Republic of Korea, Democratic Republic of
the Congo, Djibouti, Egypt, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guatemala, Guinea, Guinea-Bissau, Haiti, Honduras, Iran, Iraq, Kenya, Lao
Peopleâs Democratic Republic, Liberia, Libya, Madagascar, Malawi, Mali, Mauritania, Mozambique, Myanmar, Nepal, Niger, Nigeria, Pakistan, State of
Palestine, Papua New Guinea, Rwanda, Sierra Leone, Solomon Islands, Somalia, South Sudan, Sudan, Swaziland, Syrian Arab Republic, Tajikistan,
Tanzania, Timor-Leste, Uganda, Venezuela, Yemen, Zambia, and Zimbabwe.
5
Global Partnership for Education (2016), âGPEâs work in countries affected by fragility and conflictâ, GPE Policy Brief September 2016, Washington D.C.:
GPE.
6
See, for example, Riddell and Niño-ZarazĂșa (2016), âThe effectiveness of foreign aid to education. What can be learned?â, International Journal of
Educational Development 48(1): 23-36; or Heyneman and Lee (2016), âInternational organizations and the future of education assistanceâ, International
Journal of Educational Development 48(1): 9-22.
7. January 2019 âą OECD Development Co-operation Directorate
Chart 4. ODA by education sub-sectors
2011-16 annual average, gross disbursements, constant 2016 prices
DAC members Arab countries and institutions
Note: Unspecified is used when the targeted level of education (primary, secondary,
post-secondary) is not specified by the provider.
An estimated 63% of Arab education
ODA over 2011-2016 went to
education in general (education, level
unspecified). This external assistance
is primarily funding education facilities
and training (48%).
Between 2011 and 2016, an annual average of
USD 444 million was disbursed by all providers
towards education-related humanitarian
development finance (see Box 4 for a
methodological overview), mainly by the Asian
Development Bank (34%), Canada (29%) and
Germany (17%). This suggests that education
humanitarian ODA reached 2.8% of total
humanitarian aid, below the globally agreed
target of 4% (taking the average gross
disbursements of humanitarian aid of USD 15.7
billion over 2011-16).
Arab providers disbursed an annual average of
USD 9.3 million in education-related
humanitarian development finance between
2011 and 2016. This humanitarian ODA mainly
targeted Iraq, the Syrian Arab Republic and
Lebanon in 2016. Box 5 provides an example of
how Arab and DAC providers collaborate to
support refugees in partner countries.
Box 3. The âMadrasatiâ Initiative
An example of triangular co-operation that involves Arab and DAC providers is the âMadrasati initiativeâ that the
German Open Regional Fund finances under the Queen Rania Jordan River Foundation with the OPEC Fund for
International Development (OFID). The initiative is a response to the Syrian refugee crisis and the challenges this
crisis poses for Jordan. The aim is to improve the learning environment and quality of teaching in schools with a
high share of Syrian refugee children and to facilitate the integration of refugees into host communities. In a
closely co-ordinated approach, OFID funds the renovation of eight school buildings, which are especially used by
Syrian refugees, while Germany funds trainings for teachers and extracurricular activities for Jordanian and
Syrian students in the same schools.
Box 4. Methodology for estimating
humanitarian education-related ODA
Data shown in this flyer cover development
co-operation in the education sector. The
definition of ODA to education excludes
humanitarian aid. Humanitarian aid can be
delivered directly by a provider or channelled
through a multilateral organisation; and can
include various activities, including
education-related ones, provided they are a
humanitarian intervention. To calculate
education-related humanitarian aid, we
identified education-related projects within
the total humanitarian activities through a
key-word search using the words âeducat-â,
âlearn-â, âteach-â and âschool-â.
9. January 2019 âą OECD Development Co-operation Directorate
Table 3. Student performance across competencies,
PISA 2015 assessment results
Country Science literacy Mathematics Reading
Algeria 376 360 350
Jordan 409 380 408
Lebanon 386 396 347
Tunisia 386 367 361
MENA average 411 400 397
OECD average 493 490 493
Source: OECD Education GPS â Available at: http://gpseducation.oecd.org/Home
Note: MENA average includes Algeria, Jordan, Qatar, UAE, Israel, Lebanon and Tunisia. Morocco results will be available in 2019
and Egypt will participate in 2021.
In order to cater a larger and more diverse set of
countries, including low- and middle-income countries,
the OECD launched the PISA for Development
Initiative in 2013. The initiative aims at better
supporting evidence-based policy-making in these
countries, while monitoring international educational
targets in the Education 2030 framework, developed
within the UNâs thematic consultations.
In order to monitor SDG 4 adequately and effectively it
is necessary to spend USD 280 million per year. This
figure is based on estimates of the costs of
strengthening and maintaining education management
information systems in all countries, that include other
data sources in addition to those based on
administrative records, and ensuring global coverage in surveys. These other data sources include
multipurpose school and household surveys, learning assessments and community level data that
could serve, if efficiently assembled, reporting on multiple indicators.
Currently, it is estimated that the amount spent on SDG 4 monitoring is USD 148 million per year
and the majority of this is used to support monitoring in upper middle- and high-income countries.
To meet the shortfall of USD 132 million per year it will be necessary to increase the domestic and
external resources allocated to SDG 4 monitoring. We estimate that external financing (aid) to low-
income and lower-middle-income countries for the purpose of SDG 4 monitoring will need to
increase by up to USD 60 million per year through 2030 compared to current levels. It will also be
necessary for all countries to increase their domestic expenditures on SDG 4 monitoring by one
third.