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Opinion: Supporting the IDA is thrifty and smart

World financial leaders to consider aid to International Development Association.

The reducing burden index recognizes that the current aid system has significant waste and overlap. Many of the 152 agencies we track give aid in small packets. The median size of projects has been falling steadily and is now just $70,000, too tiny to generate scale economies. With more than 80,000 small, new projects annually, each with its own reporting and monitoring requirements, negotiating and reporting has become an enormous burden on recipients. In our index, we reward donors who minimize this administrative burden.

The transparency and learning index reflects the importance of providing timely, comparable information on who is doing what where. Without such information, there can be no coordination among donors and no learning from experience. Development assistance has yet to take advantage of the potential offered by modern information technology, such as geo-coding and real-time client feedback.

Multilateral agencies, on average, do better than bilateral agencies on three of the four indices, the exception being transparency. IDA is the only large agency that appears in the top 10 across all four indices. It does especially well in fostering institutions and in transparency and learning. Indeed, the IDA implemented a far-reaching transparency program last July and has just made all its development statistics and most internal material freely available on the web.

The conclusion from QuODA is straightforward. In these difficult fiscal times, donors should put a premium on value for their development funds. They can best do this by channeling more resources through multilateral agencies. The leader among those agencies is IDA. Concluding a generous IDA replenishment, through a reorientation of development budgets if necessary, would be a smart and thrifty move.

Nancy Birdall is the president of the Center for Global Development; Homi Kharas is as senior fellow and deputy director of the Global Economy and Development program at the Brookings Institution.