By Thalif Deen
UNITED NATIONS, May 6 1999 (IPS)

The UN Development Programme (UNDP), one of the largest providers of grant aid to developing nations, is concerned over its dependence on the generosity of 10 major donors for its survival.

“It is clear that there are a number of risks when a multilateral organisation such as UNDP is over-dependent on a limited number of donors,” says a UNDP study released here.

“This situation is further compounded by the fact that per capita contributions to UNDP core resources vary significantly from one donor to another.”

The top 10 donors to UNDP – the United States, Denmark, Japan, Netherlands, Norway, Sweden, UK, Germany, Switzerland and Canada – will provide about 85 percent of the total 1999 level of core resources amounting to about 738 million dollars.

Of the ten, the big five contributors to UNDP are the United States (100 million dollars), Denmark (85.3 million dollars), Japan (79.9 million dollars), Netherlands (73 million dollars) and Norway (69.9 million dollars).

The non-industrial states who have made, or are making, modest contributions to UNDP, include India (about 4.0 million dollars), China (2.9 million dollars), South Korea (about 2.6 million dollars), Saudi Arabia (2.0 million dollars) and Cuba (1.3 milliond dollars). They constitute about 0.1 to 0.5 percent of the total share.

UNDP’s core resources – which it can disburse without restrictions or conditions imposed by donors – are expected to reach 738 million dollars in 1999: down from 751 million dollars last year.

But non-core resources, earmarked by donors for specific projects or countries, have continued to rise – averaging more than one billion dollars annually, that brings overall contributions to UNDP up to more than 2 billion dollars a year.

UNDP Administrator James Gustave Speth says that total funding, both core and non-core resources, increased from 1.58 billion dollars in 1993 to 2.2 billion dollars in 1998.

Speth says he is “optimistic” that the upward trend indicated a sustained and increasing commitment to UNDP’s programmes for the eradication of poverty.

Although official development assistance (ODA) has shrunk to an historic law, 13 donor governments have pledged to increase their contributions to UNDP this year. They are: Belgium, Denmark, Finland, France, Ireland, Italy, Japan, Luxembourg, Portugal, Spain, Sweden, the UK and the United States.

Since 1992, ODA has declined by about 20 percent in real terms. In 1992, total ODA stood at 63 billion dollars, declining to 59 billion dollars in 1995, 55.1 billion dollars in 1996 and 47.6 billion dollars in 1997.

Speth says that the decline in UNDP’s core resources roughly parallels the global decline in development assistance. The reduced core funding, however, has forced cuts in development programmes, and restricted UNDP’s ability to allocate funds to where they are in the greatest need.

Addressing an April meeting of UNDP’s Executive Board, the deputy permanent secretary of Tanzania’s ministry of finance Gray Mgonja noted “there is no question that availability of resources is a key condition for sustenance of UNDP’s response to the needs of programmes within its mandate.

“We all understand that there has been a decline of UNDP resources, and recently, we have experienced up to 30 percent cutbacks on core resources allocated to programme countries,”

She describes the core resources as “the bedrock of UNDP’s development assistance”, particularly assistance to the 48 least developed countries (LDCs), described as the poorest of the world’s poor.

In the case of Tanzania, these cuts have resulted in reduction of UNDP assistance to combat the transmission of Acquired Immune Deficiency Syndrome (AIDS), which is devastating sub-Saharan Africa.

The cuts also have stalled Tanzania’s plans to promote the advancement of women in development; to streamline fiscal management; and the promotion of sustainable livelihoods.

“In practical terms, this could translate to an escalation of AIDS-related deaths; lack of support for women’s participation in parliament; and denial of access to micro-credit for up to 2,000 potential clients, most of them women, in rural areas,” Mgonja says.

She is critical of the tendency of donors to re-direct funds through non-core mechanisms and multilateral institutions that utilise the funds as loans rather than grants.

The resulting general trend, therefore, is for multilateral loan funds to increase, while multilateral grants are declining.

“I would like to register our concern that, these trends point to the eventual marginalisation, or even demise, of UNDP,” Mgonja told the Executive Board. “Of all our partners, UNDP is the agency we are fully comfortable with in dealing with such sensitive issues as governance, largely because of its neutrality and impartiality.”

The cuts that already have been been recorded “have seriously undermined the capacity of the UNDP country office to support our development efforts,” she noted.

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