This presentation focuses on a case study of Nepal on how to use innovative approaches to enhance aid harmonization and aid effectiveness. the presentation provides (i) an overview about the important challenges of aid effectiveness in Nepal, (ii) an analysis and lessons learned form the Sector-Wide Approach in Health, and (iii) innovations in technology to improve aid transparency, donor harmonization and development effectiveness.

1. Innovations for Enhanced Aid
Harmonization and Coordination
A case study of Nepal
Bjorn-Soren Gigler, World Bank Institute
bgigler@worldbank.org
October 7, 2011

2. 1) Background
2) Challenges
& Lessons
3) Open Aid
Map
AGENDA
1. Overview
2. Key Challenges
1) Aid Effectiveness
2) Aid Harmonization
3) Civil Society
Organization
3. Lessons Learnt
1.
2.
3.
1. Health in Nepal
2. Aid in Nepal
3. SWAp
4. SWAp in Health
Sector

3. Nepal
Landlocked, diverse country with an average $470 (GDP per capita)
• Population (million) : 29.3
• GDP per capita : $470 (South Asian average: $1,082)
• Poverty : 31% below poverty line
• HDI :
• Culturally, ethnically and religiously diverse
• Political transition in 2006
Source: World Bank (2011)

4. Nepal
Source: UNDP (2011)
Human Development Index : Trend 1980 – present

5. Nepal – Health Sector
Highest Infant Mortality and HIV prevalence in South Asia
• Wide disparity in health conditions.
• HIV infection : 0.49% (ages 15-49)
• Life expectancy (years) : 67
• Infant Mortality : 39
• Under-five mortality : 48 (per 1,000)
• Under-five Child malnutrition : 38.8%
• Birth attended by skilled health staff : 19%
• Access to an improved water source : 88
• Progress in nutrition remains limited.
Source: World Bank (2011) & UNGASS (2008)

6. KEY REGIONAL DIFFERENCES IN TERMS OF POVERTY
Data available
Indicator Poverty incidence
Time period 2001
Source CBS
MAP: POVERTY INCIDENCE
(DARKER COLOR HIGHER POVERTY)

7. Aid in Nepal
52.80%
34%
* country programmable aid as a % of total gov expenditure (Action Aid 2011)
Aid dependency *
• ODA has been increased greatly from 1960 ($8.2M) to 2009 ($994M)
• Highest aid dependent county in Asia

8. SWApSWAp
$ millions 2004 2005 2006 2007 2008 2009
All 726.0 528.7 528.3 817.8 736.4 994.8
DAC countries 378.9 369.5 345.3 260.5 491.5 598.5
AusAID 3.2 1.1 5.5 1.7 12.6 10.8
DFID 114.3 104.7 58.2 50.8 51.3 140.3
GTZ 30.9 47.6 26.8 64.0 44.5 43.2
USAID 47.7 55.5 57.9 77.1 105.9 79.4
JICA 37.9 110.8 67.8 35.7 58.1 77.0
SDC 12.0 12.8 24.9 16.2 40.1 27.7
Finland 19.3 6.4 20.8 14.6 17.8 39.6
DANIDA 40.1 5.8 32.8 12.1 47.3 45.5
NORAD 65.4 8.1 31.0 52.1 33.6 66.2
Multilateral 347.2 159.2 183.0 457.3 244.9 396.3
IDA (WB) 215.8 35.0 25.0 330.8 158.0 284.2
UNICEF 6.5 5.5 6.4 7.7 6.0 7.4
UNFPA 3.3 4.8 3.9 4.3 5.6 4.4
ILO / WHO 0 0 0 0 0 0
AsDF (ADB) 80.0 73.9 97.2 0 0 25.1
25.3%

9. Aid Flows to Nepal in Health Sector
Differences in Priority of Health Sectors (multi-lateral- bilaterals)
• Health expenditure per capita : $ 25
• Public exp. of total health expenditure : 35.3%
• Public exp. of total GDP : 5.8%
Energy only *
Transportation only*

10. SWAp (Sector-Wide Approach)
• characterized by a set of operating principles rather than a specific package of
policies or activities.
• involves movement over time under government leadership towards:
- broadening policy dialogue
- developing a single sector policy (that addresses private and public sector issues)
and a common realistic expenditure program
- common monitoring arrangements
- more coordinated procedures for funding and procurement.
World Health Organization, World Health Report (2000 )
An approach to international development that brings together
governments, donors and other stakeholders within any sector

11. SWAp for Health in Nepal
Statement of intent to guide the partnership in health sector in Nepal
(initiated in Feb, 2004)
• To reduce transaction cost to the government
by aligning external support with Nepal government’s sector plan
by strengthening harmonization among the development partners in the health sector
SectorWideApproachinHealth
Donor Country
(5)
International
Organization
(6)
• Australian Development Agency (AusAID)
• British Department for International Development (DFID)
• German cooperation agency (GTZ)
• U.S. Agency for International Development (USAID)
• Japan International Cooperation Agency (JICA)
• Swiss development agency (SDC)
• The World Bank
• International Labour Organization (ILO)
• UN children’s fund (UNICEF)
• UN Population Fund (UNFPA)
• World Health Organization (WHO)

12. • December 2003 : Health Sector Strategy: An Agenda for Reform
• February 2004 : SWAp
• July 2004 : Letter of sector development policy by GoN
• August 2004 : Nepal Health Sector Programme- Implementation Plan (2004-2010)
• March 2005 : Signing of Joint Financing Arrangement (JFA) - GoN, DFID and World Bank
• June 2009 : Signing of JFA by AusAid as third partner to provide health sector budget
Progress
Pool Partner Non-signatorySignatory - Project Support
Nepal Government
• AusAid
• DFID
• The World Bank
• ILO
• UNAIDS
• UNFPA
• UNICEF
• WHO
• AusAid
• DFID
• The World Bank
• GAVI
• GFATM
• NLRA
• Others

13.  Launched to support developing countries in achieving health sector MDGs
through health system strengthening, supporting national health plans and donor
coordination (September 2007)
 In first phase eight countries including Nepal selected for IHP+
 ‘Nepal Health Development Partnership Compact’ signed in February 2009 by
Ministry of Health & Population and eight health sector development partners and
it further commits to strengthen the SWAP in health sector
International Health Partnerships +IHP+
Donor Country
(2)
International
Organization
(6)
• Australian Development Agency (AusAID)
• British Department for International Development (DFID)
• The World Bank
• UN Children’s fund (UNICEF)
• UN Population Fund (UNFPA)
• World Health Organization (WHO)
• UNAIDS
• GDC
IHP+ Signatory

14.  Every year two Joint Annual Reviews (JAR) are held one for annual work plan and
budget and another for review of sector performance and till date nine JARs
completed successful
 ‘Health sector development partners forum’ chaired by health secretary as agreed
in statement of intent signed in 2004 & IHP+ national compact in 2009
 All major issues are duly discussed in the above two forums
Major Coordination with SWAp in Health

15. 1) Background
2) Challenges
& Lessons
3) Open Aid
Map
AGENDA
1. Progress and
Achievements
2. Key Challenges
1) Aid Effectiveness
2) Aid Harmonization
3) Civil Society
Organization
3. Lessons Learnt
1.
2.
3.
1. Health in Nepal
2. Aid in Nepal
3. SWAp
4. SWAp in Health
Sector

16. Key Achievements
some key words
• Improved health outcomes and increased capacity on financial expenditure led to
availability of more funds and vice-versa
• Availability of pool fund in significant percentage and joint planning and programming
through JAR helped to prepare more realistic and comprehensive health work plan &
budget
• The government financial & procurement system is gradually improving as SWAP
promotes national system
• Availability of more funds in health sector also helped to address the constitutional
provision of basic health as a fundamental right of the citizens and as an effort to
remove the financial barrier and reach to all citizens with a universally available
essential health care package, free health care scheme launched and users fees
removed from primary health care system
• SWAP implemented at district level with merging of many program heads into one as
“integrated district health program”

17. Key Challenges for Aid Effectiveness
Aid Effectiveness …
• Governance and accountability
• Financial management and financial flows
• Frequent changes in government
• Lack of effective private sector integration and regulation
• Continued off-budget support in health sector (non-governmental)
• Higher aid dependency for Nepal Government
• In sufficient information systems specially financial, procurement, vital
registration, physical assets and human resource management

18. Key Challenges for Aid Harmonization
• Donor efforts at monitoring and evaluation are fragmented
• China and India are big partners in health sector with significant contribution, but
refused to coordinate so that still alignment and harmonization is a problem
• Lack of open Information
• HIV is almost completely segregated from the rest of the health sector.
Aid Harmonization …

19. Key Challenges for Civil Society Participation
• Limited Information about the role of CSOs in Health
sector
• Lack of coordination of national civil society
• Political affiliation of civil society organizations
• Selective engagement of very few organizations that
are not necessarily representative of people on the
ground
• Civil society is not systematically involved in sector
meetings
Limited CSO’s Participation …

20.  Health sector SWAP has increased ownership, harmonization and aid
alignment in general.
 The capacity of health sector in context of managing big program such as
SWAP or health sector program is gradually increasing
 However, there are still needs for partners to have better coordination on
the matter of communications, monitoring and evaluation system and
geographical strategy.
 It is necessary to upgrade the national systems such as financial
management, audit of financial expenditures and information
management and inter-agency coordination.
 Technical assistance and information system with open data is crucial.
 It is necessary to engage CSOs and citizens more for better monitoring aid
flows and projects at the local level.
 It would be great to establish inter-agency linkage with other SWAPs
beyond health sector (i.e. education, environment) and try to coordinate
& address the SWAP related common issues.
Lessons Learnt

21. 1) Background
2) Challenges
& Lessons
3) Open Aid
Map
AGENDA
1. Progress and
Achievements
2. Key Challenges
1) Aid Effectiveness
2) Aid Harmonization
3) Civil Society
Organization
3. Lessons Learnt
1.
2.
3.
1. Health in Nepal
2. Aid in Nepal
3. SWAp
4. SWAp in Health
Sector

22. World Bank Projects in Nepal

23. World Bank Projects in Nepal

24. Projects by Population Density

25. Enhance Poverty Targeting

26. SECOND RURAL WATER SUPPLY & SANITATION PROJECT (RWSS)
Data available
Number of districts 73
Total observations 2,902
Mapping
LocationVDC,
Ward, Settlement
Status ?
Time period 2002-2006 (?)
Source RWSSP
Mismatched 224VDCs
MAP: LOCATION OF WSS AT VDC

27. 17. SECOND HEALTH SUPPORT PROGRAM (HSSP II)
Data available
Number of districts 75
Total observations 4,161
Mapping
Health center
location at theVDC
Status ?
Time period ?
Source Bert
Mismatched 62VDCs
MAP: HEALTH CENTERS LOCATION AT VDC