This work aims to present an overview of the international of development finance system
and its outlook for the future, taking into account the changing motivations of donor
countries, as well as the financing needs and recipient countries, their capacity to mobilize
domestic and external resources, and the institutional context in which they operate. The
document highlights two main issues: (1) South-South Cooperation (SSC), which has
acquired a new dimension as a number of developing countries have improved their living
standards and strengthened their links of solidarity with relatively less developed nations; and
(2) the role of the new actors in international cooperation, in particular that of the private
sector, including corporate social responsibility (CSR) initiatives, grants from foundations,
individual donations and various types of associations with multilateral and bilateral
agencies.
The document also tries to characterize the emerging issues relating to the system of
development finance in the context of the financial crisis, as well as the impact of the crisis
on the future outlook for new actors (Section 2). To do so, it analyses the main trends of
international cooperation flows, briefly describes the main changes in the institutional
architecture and places the activities of new actors and the area they occupy in the system of
international cooperation in context.
Author(s): Francisco Sagasti; Fernando Prada; Mario Bazán; Jorge Chávez; Gonzalo Alcalde
Series: Conference on Development Cooperation in Times of Crisis and on Achieving the MDGs (eu 2010.es)
Publisher: Presidencia Española de la Unión Europea
Year: 2010
Language: Perú
Pages: 67
City: Madrid
INTRODUCTION ...................................................................................................................... 3
1 CHANGES IN THE INTERNATIONAL DEVELOPMENT FINANCE SYSTEM.............. 5
1.1 Main trends in international cooperation flows in the context of the financial crisis ...... 5
1.2 Changes in the institutional cooperation context.............................................................. 7
1.3 New actors in development cooperation .......................................................................... 9
2. ELEMENTS OF FINANCING AND INTERNATIONAL DEVELOPMENT
COOPERATION: SPACE FOR NEW ACTORS .................................................................... 13
2.1 Motivations of the actors involved in the international development cooperation system13
2.2 Recipient countries and their capacity to mobilize domestic and external resources .... 16
2.3 Financial instruments and mechanisms for channelling international cooperation to
developing countries............................................................................................................. 22
3. SOUTH-SOUTH COOPERATION (SSC)........................................................................... 27
3.1 Capacity of countries in the South to mobilize resources .............................................. 28
3.2 The role of South-South cooperation in regional integration processes......................... 31
3.3 Triangular cooperation ................................................................................................... 33
3.4 South-South foreign direct investment ........................................................................... 34
3.5 South-South remittances................................................................................................. 35
3.6 Some pending issues in South-South Cooperation......................................................... 38
4. CORPORATE SOCIAL RESPONSIBILITY (CSR) ........................................................... 41
4.1 Towards the integration of new actors into the framework of the international system
for development cooperation, and final comments .............................................................. 45
REFERENTES.......................................................................................................................... 49
APPENDIX............................................................................................................................... 55
APPENDIX 1: LIST OF FINANCIAL INSTRUMENTS BY FUNCTIONAL CATEGORIES
AND ACTORS OFFERING THEM ........................................................................................ 56
APENDIX 2: METHODOLOGY FOR ESTIMATING THE INDEX OF DOMESTIC AND
EXTERNAL RESOURCE MOBILIZATION ......................................................................... 62
Preparation of the statistical data and variables.................................................................... 62
Estimate of the index of external resource mobilization ...................................................... 63
Calculation of the index of external and domestic resources mobilization.......................... 65
