Development experts meeting in Busan should look to Ghana for the right way to make aid a more effective investment
Investing in overseas development is sometimes a hard sell when our own country is focused on economic recovery and job creation. Sustainable development creates stronger economies, with more consumers to trade and do business with in our interconnected global marketplace. This, in turn, creates growth opportunities at home and abroad. Effective development directly improves the lives of the world's poor and contributes toward a thriving international economy that serves our shared economic interests. That's why, even in these tough times, foreign assistance is a good investment and, when done right, delivers results.
So, when government leaders, the aid community and civil society organisations from around the world meet in Busan, South Korea, next week to discuss making development assistance a more effective investment, development experts might look to Ghana for insights.
In 2000, Ghana recognised that growing its economy depended on increasing agricultural productivity. The challenges were immense. In many rural areas, nine out of 10 people were living in poverty. Use of modern farming techniques was rare, and infrastructure to expand agricultural exports was inadequate. Between harvest and market, farmers often lost as much as 30% of their yields.
To address this challenge, Ghana funneled development assistance, including a $547m (�344m) grant from the US government's Millennium Challenge Corporation (MCC), toward improving agricultural productivity and food security. The country embraced MCC's approach, requiring partners to consult with their citizens to determine their constraints to growth and then reform policies and design programmes to tackle them. Ghanaians used this strategy along the entire agricultural value chain ? including training farmers, opening post-harvest cold storage facilities and building roads to markets ? and factored in measures to monitor progress.
Although Ghana has a way to go, the efforts are already paying off.
The Overseas Development Institute calculates that, since 1983, Ghana's agricultural sector has grown by more than 5% a year, helping to fuel the economy's overall growth. According to the World Bank, the poverty rate has been nearly halved from 51.7% in 1991 to 28.5% by 2006, and Ghana is poised to meet the UN millennium Development Goal of halving extreme poverty by 2015.
Why are these returns in Ghana so impressive? They exemplify the principles that make development a prudent investment: a partnership rooted in country-owned solutions, a demand for results and a commitment to transparency.
Effectively targeted development investment allows countries to prioritise their needs, design and implement programmes and build for sustainability in consultation with their citizens. The growth of Ghana's agricultural sector, and its impact on the poor, depends on the participation of small shareholder farmers, particularly women who run subsistence farms.
An environment that encourages participation of civil society organisations is also necessary to ensure that non-governmental voices are not just tolerated but heard. An inclusive, enabling environment improves opportunities for trade and investment too.
Results are fundamental to making the case that foreign assistance is a good investment. The evolution from aid inputs to development outcomes means improving technically rigorous, systematic and transparent methods for projecting, tracking, evaluating and communicating impact. This process must be inclusive and not overlook the poor, ensuring that economic growth improves the lives of the vulnerable and marginalised. MCC, for example, tracks a continuum of results throughout the lifecycle of its programmes. MCC captures policy and institutional reforms countries make from the start to ensure sustainability.
As programmes mature, interim outputs and outcomes are assessed, like the MCC-funded training so far of more than 64,000 Ghanaian farmers. MCC's continuum includes post-programme impact evaluations to understand if income increases are attributable to MCC's investments and to learn whether programmes were designed correctly.
Maximising the impact of development requires embracing transparency as the basis for accountability and good governance. Partner governments must be held to account, both to donors and to their own citizens for how development resources are used and what they achieve.
In these ways, Busan can push the practice of development effectiveness, grounded in a non-negotiable commitment to responsibility, accountability and transparency. Because of this approach, Busan can reaffirm that development is a good investment worth making.
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