THE ASIAN DEVELOPMENT BANK�S STRATEGY FOR COOPERATION AND SUPPORT TO NON-GOVERNMENT ORGANIZATIONS

�Prepared by

�Raul P. Gonzalez

�on behalf of

ASIAN NGO COALITION for Agrarian Reform and Rural Development (ANGOC)�

�for the

�International Forum on Capacity Building (IFCB)

5-B Marilag Street, UP Village, Diliman, ��������������������� P.O. Box 3107
Quezon City, Philippines���������������������������������������������� QCCPO 1103,
Telephone: (63-2) 433-7653, 433-7654���������������������� Quezon City,
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E-mail: [email protected]������������������������������������������ Philippines
URL: http://www.angoc.ngo.ph | http://www.philonline.com.ph/~angoc

EXECUTIVE SUMMARY

This study undertakes an in-depth investigation of the principles and practices of Asian Development Bank (ADB) in dealing with NGOs. It is meant to provide input for the International Forum on Capacity Building (IFCB) in its dialogue with the Bank on the latter�s policies and programs with respect to the capacity building of Southern NGOs (SNGOs). The study builds on the findings of an earlier IFCB donor survey, which was commissioned in May 1997.

The IFCB, a multi-stakeholder Forum of SNGOs, Northern NGOs (NNGOs) and Donors, seeks to: (a) facilitate information sharing and cooperation within and across constituencies on policies, programs and innovations in capacity building of SNGOs; (b) promote dialogue at the national, regional and international levels among SNGOs, their counterpart NNGOs and donors so that policies, programs and practices on capacity building will be informed and influenced by the voices and experiences of SNGOs; (c) support emerging capacity building initiatives that address the priority needs of SNGOs and promote learning about innovations; and (d) promote an enabling environment for more effective responses to the capacity building needs of Southern NGOs.

1987 Policy Paper on Bank Cooperation with NGOs

In the mid-1980s, the persistence of poverty in the region, greater recognition of the need to address social issues and expanding Bank-NGO cooperation led to the formulation and adoption of the Bank�s first policy paper on NGOs, �The Bank�s Cooperation with Non-Governmental Organizations (R79-87)� in 1987. The 1987 policy paper recommended Bank-NGO cooperation in operational terms, that is, in terms of the latter�s possible contributions to the Bank�s project-related activities. �

Succeeding Bank publications echoed the same theme of cooperation with NGOs in Bank-related project activities, although this was accompanied by an increasing recognition by the Bank of the unique role of NGOs in the development process.

Despite increasing Bank acceptance of NGOs as partners for development, however, cooperation with the latter remained largely limited to the latter�s involvement in the Bank�s project cycle through much of the 1990s.

NGO Involvement in Bank Loan and Technical Assistance Activities

Direct NGO involvement in the Bank�s loan and technical assistance activities increased steadily in the last decade. In 1998, more than half of the Bank�s project approvals (28 out of 51) involved NGOs directly in some capacity. This is in contrast to 1990 when only 4 of the 73 approved loans involved NGOs. NGO involvement in loans and technical assistance activities includes consultation in identification and design, responsibility for the implementation of specific components of some projects and, in some cases, of entire projects.

In 1998, the agriculture and natural resources and social infrastructure sectors reflected the most significant cooperation with NGOs. There was also significant NGO involvement in multisector projects, including emergency rehabilitation projects and projects developed as country-level responses to the financial crisis.

Even as it continues to work in countries where NGOs have traditionally played a significant role in both official and nonofficial development efforts, the Bank is also beginning to work with NGOs in countries that have not had as rich an NGO tradition. The Bank attributes this to the broadening of development processes to address human development, social development and environment protection, which has created a role for NGOs in countries in which NGOs traditionally have not played a major role.

Issues in Bank-NGO Cooperation

In 1998, work was completed on a Bank regional technical assistance (RETA) project that studied NGOs in Bangladesh, Cambodia, Indonesia, Lao PDR, Nepal, Pakistan, Philippines, Sri Lanka and Vietnam. The purpose of the study was to establish an accurate profile of national NGO communities and identify specific approaches of how the Bank, NGOs and governments can work together more effectively and productively.�

The following major issues in Bank-NGO cooperation were identified by the study.

1.�� As pointed out in the Philippine paper, successful Bank-NGO collaboration requires consideration of: (i) the evolution of NGOs as both a critique and an alternative to the traditional top-down approaches of government; and (ii) the fact that individuals have created or joined NGOs precisely to escape the stifling bureaucracy of governments.

This implies that: (i) NGOs will continue to perform their roles as watchdogs or public interest groups; (ii) NGOs are likely to resist attempts that will compromise their flexibility, autonomy and independence; and (iii) the ideal relationship with NGOs is one of equal partnership.

The above principles point to the need for: (a) recognition of NGO roles beyond their service-delivery functions and thus, of potential NGO roles both within and beyond project cycles; (b) more open and inclusive processes for certain activities, such as public dialogues and consultations; and (c) involvement of NGOs in all phases of the project cycle, especially during the early phases of project identification, formulation and design.��

2.�� While NGOs in the nine countries were generally interested in cooperating with the Bank, few of them have much understanding of the operations of the Bank, particularly its project cycle.

3.�� While NGOs have traditionally been valuable sources of information for the Bank�s work in policy development and project identification and design, they are not satisfied with simply being providers of ideas and information.

4.�� In several countries, NGOs expressed disappointment that, after having provided information to Bank mission personnel, they received no subsequent feedback. NGOs also expressed understandable concern about how the information they provided is to be used by the Bank.

5.���� While the benefits of involving NGOs in Bank activities may be clear, the process by which NGOs can actually become involved is less clear. Apparently, one key to effective involvement of NGOs in a project activity is an early decision to seek NGO involvement.

6.���� In terms of GO-NGO relations, the study found that, as more resources flow through NGOs, governments, who are responsible for safeguarding the public interest, have expressed increasing concern about the accountability and transparency of NGOs. Increasingly, governments are faced with two apparently conflicting roles: opening up opportunities for NGOs, while increasing its own watchdog role over them. On the other hand, while most NGOs concede that increased cooperation with government is a good idea, the question arises as to how the independence of NGOs � which is their source of strength and significance � can be protected.

1998 Bank Policy Framework on Cooperation with NGOs

In April 1998, the ADB Board approved an update of its 1987 Policy on Cooperation with Nongovernment Organizations.� The 1998 policy framework envisions a broader role for NGOs beyond their traditional cooperation in Bank-related project activities towards involvement in the policy development of the Bank. Following are the key elements of this new policy framework:

1.�� In policy development, the Bank plans to exert greater effort in cooperating with NGOs in the formulation of policies that are consistent with its mandate and strengthen its development policy agenda. Similarly, the Bank will increase cooperation with NGOs in project and programming work, when such cooperation supports and contributes to the effectiveness and sustainability of Bank operations.

The Bank plans to seek out competent NGOs with substantial knowledge in their areas of focus and with whom cooperation would be appropriate and mutually beneficial.� Such cooperation � whether in project, programming or policy activities � will consider the type of NGO, the issue or interest being addressed, and country-specific considerations.

In addition to existing formal and informal dialogues with NGOs, the Bank recognizes the need to identify mechanisms for regular policy-level consultation and dialogue between the Bank and NGOs. To address this need, the Bank is considering the establishment of an ADB-NGO Committee, analogous to the World Bank-NGO Committee, which would structured for the appropriate representation of both the Bank and the broad NGO community in the Region. The Committee is envisioned to function on various levels, including regional (Asia), sub-regional (South and Southeast Asia) and country levels.

2.�� The Bank recognizes that, because of the diversity of the NGO sector, a single view of NGOs or a single approach to NGO cooperation will not be adequate. Mechanisms for cooperation with NGOs will vary according to the type of NGO, the issue or interest in question, the specific kind of cooperation being considered and the specific circumstances that exist in each case, including country-specific circumstances.

3.�� The Bank expects cooperation with NGOs at the country level to be a dynamic tripartite relationship involving the Bank, governments and NGOs. Where desirable and appropriate, the Bank shall promote government-NGO dialogue and cooperation in development efforts.

NGOs can perform an alternative role in reflecting, explaining, and advancing the views, concerns and needs of the groups and communities they represent, even as the Bank recognizes the primary role of governments in country work and country programming. At the same time, the Bank will encourage governments to recognize NGO inputs in country-level activities.

4.�� The Bank expects its loan and technical assistance activities to benefit from the knowledge and expertise of NGOs in a number of ways, including: (a) NGOs can help articulate the development problems and needs of beneficiary communities, thereby helping the Bank to identify, design and implement relevant, effective, and appropriate solutions to development concerns; (b) cooperation with NGOs can develop and enhance public awareness of development efforts and facilitate the participation of affected persons and communities in project design and implementation; (c) existing NGO programs can serve as models in the design of larger projects; (d) both operational and advocacy NGOs can be sources of alternative perspectives on development questions, needs and perspectives of intended beneficiary communities, and modalities to be employed in loan projects and technical assistance; (e) NGOs can be engaged as executing agencies or contracted to delivery specific project components; and (f) NGOs can be involved in benefits monitoring and evaluation and post-evaluation activities.

5.�� To facilitate closer operational relationships with NGOs, the Bank plans to strengthen its internal capacity for NGO cooperation, through staff training, skill development activities, and other related activities.

Bank Capacity-Building for NGOs

In line with its new policy framework for cooperation, the Bank intends to pursue institutional development and capacity-building support for NGOs, consistent with overall strategies and existing policy and practice. At the same time, institutional development and capacity building will be provided for governments in NGO-related matters.

The Bank recognizes that institutional development and capacity building support for the NGO sector is a development initiative in itself. It would be in the Bank�s interest to provide the necessary and appropriate institutional and capacity building support to address the weaknesses of NGOs, particularly at the local and national levels.

In addition, the Bank will explore various institutional strengthening innovations, including the establishment of a facility or a fund through which financial support could be provided to NGOs supportive of Bank programming in its Developing Member Countries (DMCs).

Similarly, it would be in the Bank�s interest to provide necessary and appropriate institutional development and capacity building support to DMC governments, toward the creation of a policy environment that would foster government-NGO relations and support NGO contributions to development processes.

Conclusion

Those involved in the NGOs campaign on the ADB generally believe that, while the rhetoric of reform has entered the language of the Bank, the reality of reform has yet to take root in the attitudes among the staff and decision-makers, as well as in actual practice in the field.

It is tempting to make the same judgement of the Bank�s policy and practice of cooperation with NGOs over the past twelve years. After all, apart from sporadic Bank-NGO consultations (the majority of which have been initiated by NGOs) and a number of studies on NGOs over the past decade, the Bank has made little progress in dealing with NGOs, particularly in the policy arena.

At the same time, however, the Bank has shown renewed initiative through its 1998 policy framework of cooperation with NGOs, which is, by and large, compatible with the IFCB mandate of capacity-building for Southern NGOs.

Only the future will determine whether the Bank can follow through on this new policy initiative. In particular, a great deal will depend on the Bank�s efforts to strengthen processes for Bank-NGO consultation, particularly the creation of an ADB NGO committee that will institutionalize the dialogue between NGOs and the Bank.

NGOs will also be watching closely at the Bank�s efforts to develop creative processes that will involve NGOs in country-level programming, especially in countries where governments appear reluctant to include NGOs in national development planning.�

A third challenge for the Bank is the application of its existing policies and practices on contractual relationships within the context of the specific circumstances and characteristics of NGOs.���

Given the above, it is appropriate for IFCB to initiate a critical dialogue with the Bank at this time. After all, it is unlikely that multilateral financial institutions will �wither away� and, if recent trends are to be believed, they will play an even larger role in the affairs of nations and regional alliances in the new millennium.