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Thursday, January 17, 2008
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ADB more effective than WB as aid provider

Study finds

Aid provided by the Asian Development Bank (ADB) to Bangladesh is more effective than that from the World Bank (WB), although the amount of WB aid is eight times higher than the ADB, according to a study.

The study found that the WB loan procedure is bureaucratic, while the ADB's is easier and recipient friendly.

Based on 55 Bangladeshi respondents including former ministers, lawmakers, and secretaries, the survey outcome was presented at a seminar.

Unnayan Onneshan, a local centre for research and action on development, and Overseas Development Institute (ODI), UK, jointly organised the seminar on 'Stakeholder Perception on the Aid Effectiveness of Multilateral Organisations' in Dhaka yesterday.

The seminar was a follow-up of a study conducted in Bangladesh as well as other five aid recipient countries -- Ghana, India, South Africa, Tanzania and Zambia -- under a pilot project of the UK Department for International Development (DFID).

The study in Bangladesh was conducted during March-May of the last year.

The key stakeholders' views about aid effectiveness of multilateral organisations and their preferences for taking additional aid in future have been incorporated in the study. The six multilateral organisations that have been taken into account are: ADB, European Commission, Global Fund for AIDS, TB and Malaria, United Nations Children's Fund (Unicef), United Nations Development Fund (UNDP) and WB.

Presenting the survey report, M Iqbal Ahmed of the Unnayan Onneshan said

the respondents preferred UNDP as the most effective financial assistance providing agency and ADB the second most effective one.

And also, UNDP is the respondents' first choice for foreign aid.

Iqbal told the seminar that in this regard ADB is the second choice, EC third, Unicef fourth and WB the fifth.

Simon Burall, research fellow of ODI, highlighted key findings of the report on 'Assessing the Effectiveness of Multilateral Organisations' at the seminar.

M Hafizuddin Khan, a former adviser to the caretaker government, said while funding Bangladesh's different projects the WB interferes into policies which is 'unexpected'.

Shahidul Haque, former director of Dhaka Chamber of Commerce and Industry, said multinational donor agencies' views on Bangladesh's economic development is welcome, but their remarks on other internal issues including politics is not acceptable.

Dhaka University professor Abu Ahmed came down heavily on donor agencies saying that these agencies never suggest raising capital from stock market or privatising a government entity through this market.

Economic Relations Division Secretary Aminul Islam Bhuiyan said the present foreign aid to Bangladesh amounts to two percent of the GDP.

“Bangladesh receives loan from WB, ADB and Islamic Development Bank at soft interests and we are also shareholders of the institutions. However, we rarely take loans with hard terms from donor agencies,” he said.

Pointing to the fact that domestic funding for infrastructure and human resources development is not enough, he said there is a need for taking donors' assistance.

Chairing the function, former secretary Suhel Ahmed Choudhury said donors should provide assistance to countries like Bangladesh in a way that they can graduate to the list of developing countries.

Quazi Shahabuddin, director general of Bangladesh Institute of Development Studies, also spoke at the function, moderated by Unnayan Onneshan Chairman Rashed Al Mahmud Titumir.

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