Unofficial translation

Minister of Development Cooperation Kari Nordheim-Larsen

Statement to the Storting on development cooperation policy

28 April 1997

Background and main features

The Government's new Long-term Programme underscores the responsibility and obligations of Norway and other rich countries to contribute towards sustainable development on an international basis. Humanitarian, economic, environmental and security policy considerations all call for our active involvement in the situation of developing countries. Underlying our commitment is a sense of solidarity and shared responsibility. We cannot accept the gap that exists between rich and poor, both between countries and within many societies. We cannot stand by and watch as fundamental human rights are violated.

In order to follow up on our international responsibility and our solidarity with developing countries, the Government will gradually increase Norwegian development aid to one per cent of our gross national product. This will, of course, have to be in keeping with the possibilities of utilizing the funds effectively.

According to an opinion poll published last week by Statistics Norway, development aid has the firm backing of the Norwegian population. Eighty-four per cent of the respondents stated that they are in favour of helping developing countries. This figure is even higher than in the poll conducted two years ago. The poll also reveals that a majority are against reducing the level of development aid.

Internationally, however, Norway is going against the current. Many countries have, unfortunately, reduced their development aid substantially in the past few years. In 1995, the total aid provided by the OECD countries decreased to 0.27 per cent of their gross national product. And the trend continues to move in the wrong direction. The level in 1995 was the lowest since the UN adopted its target of 0.7 per cent in 1970. Only Norway and three other countries attained this goal. Another aspect of this picture is that an increasing share of aid is being spent on emergency relief.

While the volume of aid has decreased, there has been a sharp rise in transfers in the form of private investments and credits. The flow of private capital to developing countries has multiplied since 1990. The problem, however, is that this capital flow, which is far greater than the value of official development aid, is largely channelled to countries that are already experiencing rapid growth. The poorest countries are the losers as regards both aid and investments.

It is, of course, encouraging that economic development appears to be accelerating in many developing countries. At the same time, it is extremely worrying that a large number of poor countries are in danger of being marginalized, and may end up as a permanent underclass in a global perspective. It is more important than ever to concentrate aid on the countries that need it most, and to support the type of multilateral efforts that particularly benefits those countries.

The debate on Report No. 19 (1995-96) to the Storting on main elements of Norwegian policy towards developing countries and the aid budget for the current year showed that there is general agreement as regards the central pillars that form the foundation for Norwegian development aid. In line with signals received from the Storting, I will continue to focus strongly on Africa and to intensify efforts in the fields of health and education. This means that poverty orientation will remain a fundamental element of Norwegian development aid.

NGOs play a central role in Norwegian development aid. Last year, a total of NOK 2 billion was channelled through NGOs, over 80 per cent of which through Norwegian organizations.

This poverty orientation also means that there is a focus on the situation of women and gender equality in our development aid. In order to achieve better social, economic and political conditions, we must work to ensure that national authorities base their policies for social development on the experience of both women and men. Therefore, consideration for gender equality is being integrated into all of our development efforts.

Poverty and environmental problems and the issues of peace and security are the greatest challenges facing mankind. The most effective means of meeting these challenges is through binding global cooperation. This cooperation must take place both bilaterally, between countries in the north and the south, and through multilateral fora.

Multilateral cooperation

In the light of this, the multilateral system of cooperation becomes more important than ever. Safeguarding common global interests is a responsibility that must be shared by all countries. The UN and the multilateral system as a whole are important in terms of promoting justice and development. In recent years, international negotiations have resulted in declarations of principle and programmes of action to achieve common global goals with regard to population issues, sustainable development, social issues and food security, among other things. Not only are international resolutions of this kind important for the activity of international organizations, they also serve as guidelines for all development cooperation.

Development banks and UN agencies constitute important channels for development aid. However, the UN's financial situation has deteriorated in recent years. As a result, there is a growing gap between the demands made on the multilateral cooperation fora and the resources available to the organizations. The Government will therefore maintain the general contributions provided through multilateral organizations at a high level. In addition, earmarked grants to these organizations may be an effective means of concentrating efforts on high-priority areas. In this way, the considerable expertise that the international community has built up in the various multilateral organizations can be used to ensure that Norwegian aid resources are used as effectively as possible for the benefit of the poorest countries.

Besides being effective development aid, earmarked financing also serves as a tool for the follow-up of Norwegian policy vis-à-vis the multilateral institutions. By encouraging a greater focus on specific areas, we exert an influence on the overall activity of the organizations. This strengthens Norway's active role in efforts to change the organizations' priorities.

If the multilateral system is to accomplish its wide-ranging tasks, we as member countries must help to ensure that the system functions as well as possible. In 1996 the Nordic countries drew up proposals designed to strengthen and enhance the efficiency of the UN's work in the field of development aid. The report on the 1996 Nordic UN Reform Project, which I had the pleasure of presenting to the UN Secretary-General in January, contains a number of specific proposals, the most important of which concerns the consolidation and integration of all UN aid activities at country level under one roof and one administrative head. The proposal to consolidate activities at country level has been followed up by a proposal for closer coordination and integration of aid activities at headquarters level.

The proposals have been well received and hailed as a valuable contribution to the ongoing discussions in the UN. We have great expectations as to what UN Secretary-General Kofi Annan will be able to achieve. In his first reform initiative on 17 March, he advocated consolidating activities at country level and strengthening the position of the UN coordinator, which is very much in line with the proposals in the Nordic report. Norway will follow up this matter very closely and will play an active role in various fora. As you know, the Government has just submitted a report to the Storting concerning the reform of the entire UN system. I hope that this report can be debated in the course of the spring session.

It is gratifying to note that in recent years the aid priorities set by large, influential institutions such as the UN Development Programme (UNDP) and the World Bank have become increasingly similar to those of Norway and like-minded countries. This suggests that our political efforts in these institutions are making an impact, and that we can significantly increase Norwegian influence in a North-South context through multilateral efforts. This applies in particular to emphasis on the social sectors, gender equality and the environment.

In the World Trade Organization (WTO), Norway has advocated that the developing countries, particularly the poorest countries, be more fully integrated into the multilateral trade system. In 1995 the Government proposed the establishment of a WTO fund for technical assistance to the poorest countries. Other countries have now endorsed this initiative, and specific projects are under way. Norway is particularly concerned that aid to trade-related activities in the poorest countries should be viewed in connection with their access to the markets of other countries. On behalf of the Government, I presented a proposal for improved market access for the poorest countries during the WTO ministerial conference in Singapore. I am pleased to note that the EU, for one, is following this up with special measures to encourage this process.

Bilateral cooperation

The fact that about half of our bilateral aid goes to Africa illustrates the high degree of poverty orientation in Norwegian development aid. For many countries in Africa south of the Sahara, the 1980s and, to some extent, the 1990s have been decades of economic stagnation and growing poverty. Nonetheless, the picture is not entirely gloomy. The general parameters for economic development have been strengthened, both internationally through the WTO agreement and at national level in many developing countries. Important partner countries such as Uganda, Tanzania and Mozambique can point to impressive progress in the implementation of reforms in the economic field. This has contributed to the real growth of between five and ten per cent achieved by these countries.

Many countries have also moved towards democracy, for instance by holding elections. But democratization is a fragile process. Zambia is one example of this. After the first multi-party election in 1991, which was won by the opposition, there were great expectations as regards the next stage of democratization. However, a new constitution, which was adopted prior to the elections in 1996, set clear limitations as to who could run for election. The system of voter registration made it difficult for people to register. In some respects, severe restrictions were imposed on the freedom of the press. As a result of these factors, we decided in March last year to postpone any decisions on new aid measures. Both before and after the election, we and the other Nordic countries expressed our concern and criticism to the Zambian authorities.

We have now made it clear that we intend to reorient our aid, with greater emphasis on measures to promote democratization and human rights. Normalized relations will provide us with the best basis for contributing constructively to a further democratization process. We foresee an active dialogue with the Zambian authorities on the basic conditions for cooperation.

In Ethiopia too the situation is difficult and poses particular challenges for development cooperation. The current regime has at times been criticized strongly for lack of respect for human rights. Even though it may be difficult to get a clear grasp of the situation, developments in this area give cause for concern. We have made this quite clear in our contact with the Ethiopian authorities, most recently during aid negotiations in Addis Abeba last week.

The situations in Zambia and Ethiopia illustrate how development aid is intertwined with democracy and human rights issues. Generally speaking, cooperation and positive measures are the best means of promoting democracy and human rights. Norway also has a great deal to contribute in this field, through contact and cooperation between authorities and through NGOs, academic institutions, the private sector and employees' organizations.

At the same time, development cooperation must be based on the premise that our partner countries themselves must pursue a policy that promotes development. We must maintain close contact with our partners as regards the importance of respect for human rights and international agreements, as well as the equitable distribution of social assets. It must be made clear how developments in these fields will affect development cooperation, both positively and negatively. Our partners should be aware of what might happen if our cooperation is subjected to pressure, for instance if the situation as regards human rights or democracy should deteriorate. We would consider reorienting, reducing or discontinuing aid if the situation so requires. At the same time, we stress our readiness to contribute constructively in situations where support is needed for economic reforms and the development of democracy, and where the authorities show a genuine willingness to effect changes for the better. In some cases, it will be appropriate to offer countries extraordinary aid during a transitional period in order to support necessary restructuring processes.

Due to the scarcity of resources, the authorities must be willing and able to set priorities. As many resources as possible must be concentrated on measures to promote development. In this context we have been concerned about the level of military expenditure. Norway expects greater openness with regard to military spending, and that such expenditure be subject to democratic control. Last year, Statistics Norway was commissioned by the Ministry of Foreign Affairs to carry out a study of military expenditure in a number of developing countries. The study shows that the percentage of fiscal budgets allocated for military expenditure has declined in the 1990s. This is positive. Most countries that still have high military expenditure have recently emerged from situations verging on that of civil war. Mozambique is one such example. It is important that Norway show a willingness to provide assistance in such transitional situations. In Nicaragua we saw how military spending was significantly reduced shortly after the rebels laid down their arms. Nicaragua is also an example of how aid can contribute to the consolidation of peace and to active disarmament.

Developments in Guatemala illustrate how the combination of international peace efforts and aid can be effective. Hopefully, the signing of the peace accord in December last year will prove to be a watershed in the country's history. Even though Guatemala does not have the status of priority partner country for Norwegian aid, we will continue our efforts to help to safeguard peace through the protection of fundamental rights for all population groups.

The Middle East is another area where there is a close correlation between our involvement in the peace process and our aid programme. This means that Norwegian development aid comprises both long-term aid activities and instruments of a shorter-term nature, directly targeted at supporting the implementation of the peace process. This aid consists of both bilateral measures and activities financed jointly by Norway and multilateral organizations, primarily the UNDP and the World Bank. The further progress of the peace process will be decisive for economic and social development in the area. But without an active commitment to development aid, the chances of a lasting peace and enhanced protection of human rights would be even weaker than they are at present.

Norway feels, and will continue to feel, a special responsibility as chair of the Ad Hoc Liaison Committee (AHLC), a group of international donor countries that provide funds to the Palestinian administered areas. In the current situation, it is very important that aid programmes in the Palestinian areas be governed by a long-term perspective, and as far as possible planned in such a way that they can be implemented despite any fluctuations in the peace process. At the same time, however, Norway and other donor countries must have sufficient flexibility to be able to provide funding for short-term measures and to meet any acute needs that might arise when setbacks occur in the peace process.

Short-term versus long-term aid

Humanitarian assistance increased from 11 per cent of total development aid in 1990 to 17 per cent in 1996. The same trend can be seen in the aid provided by other countries. The reasons for the rise in humanitarian aid are well-known, headed by the situation in the former Yugoslavia, the peace process in the Middle East and the tragedy in Central Africa. We must take care not to pursue a dogmatic policy as regards the proportion of short-term to long-term aid. I believe that few people feel we should have contributed less in precisely the areas I have mentioned. In the final analysis, it is the overall international situation, and the nature of the various crises and humanitarian needs, that must determine the proportion of long-term to short-term aid.

In an emergency, when people have been driven from their homes and lack the most basic necessities in terms of food and shelter, assistance will be focused on meeting these needs, thereby saving lives. Once the crisis is over, emphasis is placed on measures that will enable refugees and internally displaced persons to return home. In many places, rebuilding and repairing housing, demobilizing troops and demining operations are also a prerequisite for reconstruction and returning home. In such situations the distinction between emergency relief and more long-term measures becomes unclear. In this respect it is important to view humanitarian assistance and long-term development aid as being closely related.

In many areas torn by conflict, Norway provides humanitarian assistance to relieve acute suffering and supports attempts at peace-making and mediation, reconciliation measures and activities aimed at building up democratic institutions after the conflict has been resolved. This is the case, for instance, in Rwanda and Burundi, the Palestinian administered areas, Guatemala and the former Yugoslavia. Our support in these areas is coordinated with that of the UN and with the respective countries' own reconstruction strategy.

Bosnia-Hercegovina is an illustration of the necessary interplay between humanitarian efforts and reconstruction measures. After four years of emergency relief, we note that the reconstruction of Bosnia is now in full swing. For several years to come, however, there will continue to be a need for international aid in a number of fields. While our humanitarian assistance has been scaled down, we have entered into reconstruction activities with a time-frame of two to five years. This year we plan to spend NOK 100 million on reconstruction, primarily on infrastructure projects and activities within the social sector. Support for measures to promote democracy and human rights will also constitute an increasingly important part of our aid to Bosnia. In view of the changed situation in Bosnia, it is expected that the need for humanitarian aid will decline considerably in 1998, whereas the need for more long-term aid will increase.

Focus on health and education

In its Long-term Programme, the Government emphasizes developments in the fields of health and education. This has both a national and an international dimension. In connection with the follow-up of the UN Social Summit in Copenhagen, Norway took the initiative for an international meeting in Oslo in April 1996 to concretize the aim of an increased focus on social sectors. This meeting was especially linked to the "20/20 initiative", whereby donor nations and developing countries mutually undertake to allocate 20 per cent of their aid funds and 20 per cent of their government budgets, respectively, for the funding of basic social services. Several developing and industrial countries were interested in the proposal and expressed their willingness lead the way. We are working among others with the Netherlands and central UN agencies to arrange a follow-up meeting to further the 20/20 initiative.

The Government intends to increase aid for basic education. In the past year, we have made good progress in following up the intentions as regards increased funding for education for girls. In 1996, the Government provided substantial support through UNICEF for basic education for girls in Africa. Norway has also taken part in a joint project with the World Bank to identify obstacles to girls' education and increase the awareness of key decision-makers of the importance of girls receiving an education. This is probably the best social investment developing countries can make.

The Government has increased aid for health measures through multilateral organizations. At the same time we are making an active effort to strengthen the aid activities of the organizations concerned, particularly the World Health Organization (WHO). Norway took the initiative for an evaluation of the WHO as a channel for development aid. The report on this evaluation will now be followed up by a study of WHO activities in developing countries. It is our hope that we will by these means be able to help to enhance the effectiveness and focus of the organization's aid activities.

In order to fulfil the aim of increased aid to health and education, we have channelled considerable support to these fields through multilateral organizations. We will also increase the direct bilateral support for health and education, but this must be done over a somewhat longer period of time. A rapid restructuring of country programme cooperation is not advisable; nor is it considered desirable by the countries with which we cooperate. This will be somewhat easier to achieve in countries where we are currently in the process of establishing new, long-term programmes. In Nepal and Malawi, for instance, we intend to make basic education a main sector of development cooperation, as is already the case in Bangladesh. However, it is important to be aware that it will take some time before new activities make a visible impact on aid statistics.

Poverty is one of the main reasons why children are used as manpower. Combating child labour is therefore an important element of the focus on poverty in Norwegian aid, and it will remain a priority in Norwegian development cooperation policy in the years ahead.

However, child labour is not only a result of poverty. Political will is also called for. The problem will not be solved unless the political authorities recognize that child labour is in fact a problem, and demonstrate that they are willing and able to address the problem. The UN Convention on the Rights of the Child is the most important instrument we have for combating child labour, and has now been ratified by 189 countries. Norway will provide aid to promote the practical implementation of children's rights in general, and the protection of children against economic exploitation in particular.

In connection with efforts to combat child labour, Norway has taken the initiative for organizing a conference to address this issue in Oslo in October 1997. The objective is to identify strategies at national, regional and international level to eliminate child labour. The conference will focus particularly on the role that aid can play in combating this problem.

Debt

For many of the poorest countries, debt is still a serious obstacle to economic and social development. The Government remains firmly committed to international debt relief schemes for these countries. However, debt relief cannot be considered in isolation from the country's own policy. The country must channel the resources liberated by debt relief to measures that promote development, and must pursue an economic policy that will not result in new debt problems.

In autumn 1996, after lengthy negotiations, agreement was reached on a new, comprehensive debt relief scheme for the poorest, most heavily indebted countries. This scheme, which was initiated by the World Bank and the International Monetary Fund, is based on the countries' ability to service their debts and constitutes a fundamentally new approach. Some twenty countries, most of which are African, are currently struggling with unmanageable debt problems or are in the danger zone. The goal of the new scheme is to ensure that the countries achieve a manageable debt situation. All creditors must assume their share of responsibility, and aid funding must be provided by donor countries.

An important task in 1997 is to ensure that the newly adopted debt scheme is put into operation. Norway will make an active effort to achieve this objective, for instance in the governing bodies of the Bretton Woods institutions and the Paris Club. Norway will contribute financially to the scheme, and will seek to ensure the broadest possible participation, particularly by the major donor countries. Uganda will be the first of the African countries to benefit from the scheme.

The Government has also assessed the various bilateral debt relief arrangements that have emerged. A specific example of such an arrangement is the Swiss debt conversion scheme referred to by the Storting in its recommendation on Report No. 19. In my view, the scheme gives external actors too direct control of parts of the budget of individual developing countries. Furthermore, it is too expensive to administer for both debtor and creditor countries, as is often the case with bilateral debt relief schemes. The geographical profile of Norwegian debt claims is another reason why I regard the Swiss scheme as not particularly well suited in our case. The Government would not ordinarily advocate that Norway unilaterally write off debts, although I would not rule out the possibility of employing bilateral debt relief measures in special cases.

In practice, Norway participates actively in all the international debt schemes that have been established. Because the debt problems must be solved internationally, our main strategy is to help to put in place effective international arrangements that will enable the poorest developing countries to put their debt crises behind them.

Economic development. The role of the private sector

Last November a summit meeting was held to discuss the issue of international food security. Norway played an active role during the meeting, stressing the importance of a broad-based approach, with for instance poverty reduction, food supplies, the sustainable development of food production, nutrition, the role of women and environmental issues as crucial areas of support. These are areas in which we have traditionally attached great importance to Norwegian development aid and where we provide considerable support.

In the poorest countries agriculture plays a dominant role in production activities and has great significance for overall employment, income and export revenues. In keeping with the recommendations of a number of international organizations, the industrial policies of such countries must be focused particularly on laying the groundwork for sustainable growth in agricultural production, with an emphasis on greater productivity. This would yield greater income, both in agriculture and in the local processing industry. In this sense, agriculture serves as an impetus to economic growth in many of the poorest developing countries. The Government will therefore increase trade-related aid to the poorest countries to stimulate production, for instance by enhancing the authorities' ability to encourage private sector development and growth in agriculture.

The tendency towards marginalization of the poorest countries is primarily a result of the fact that the private sector in these countries lacks a credible public, legal and institutional framework. Development aid can play an important role in this connection. The multilateral development banks have made considerable headway in developing banking and financial systems in these countries. Norway focuses especially on support for capacity-building and institutional development and on the development of legislation. Without effective laws and a public sector capable of enforcing them, the private sector will not flourish.

The Norwegian private sector possesses know-how and technology that are important and useful to many developing countries. The Government therefore wishes to involve the Norwegian business and industrial community actively in aid efforts. Aid must in particular be focused on promoting investments in developing countries which have difficulty attracting capital in other ways. Industrial and commercial schemes are one way of attracting the Norwegian private sector to high-risk markets. Today there is an acute lack of capital in most of the developing countries with which Norway cooperates. And these are the countries to which we primarily wish to channel this support. Where they invest is, of course, up to the companies themselves. But the Government will, through its aid schemes, do what it can to make poor developing countries a real alternative when investment decisions are made. An important factor in this connection is NORFUND, which will soon become operative with a capital base that will gradually be increased. Once NORFUND is in place, the way should be clear for increased investments by the Norwegian private sector in developing countries.

Another means of promoting private sector development in developing countries is by awarding contracts funded over the aid budget to competitive local companies. It is primarily the recipient countries themselves that are responsible for procurements, on the basis of their own guidelines governing such procurements. This is in keeping with our principle of recipient responsibility. The Government is, however, concerned about providing favourable conditions for the greater use of local supplies in cases where this also results in effective aid. In this context I would note that the percentage of local supplies that may be included in a mixed credit has now been increased from a maximum of 30 per cent to 50 per cent.

In the survey I mentioned at the beginning of my statement, 62 per cent of the respondents are of the view that the Norwegian private sector has a natural role to play in development cooperation. I share this view. Arguments such as we must choose between measures that are advantageous to the private sector and those that have a major impact on development are, in my view and that of many others, untenable. If this cooperation is to be further developed and continue to enjoy the necessary support of the population, it is however important that we take a consistent stance. In the long term this will also be in the interests of the private sector. In special cases it might mean that commitments are revoked or contracts are terminated if the situation changes in such a way that our conditions for taking part are no longer present. This must be the case even if there is a chance that it might have negative consequences for the companies involved.

A specific example of this is our involvement in the construction of the Pangue Dam in the Bío-Bío River in Chile. The main reason why the Government agreed to support the project in August 1994 was that the IFC, which is the institution for the private sector in the World Bank group, had in its agreement with the contractor stipulated that comprehensive environmental impact assessments would have to be carried out if the watercourse were to be further developed at a later point in time. It was among other things in order to have the possibility of following up the environmental requirements effectively that we, in our agreement with Chile, entered a reservation to the effect that if the agreement between the contractor and the IFC were to be terminated for any reason, the Norwegian loan agreement might also cease to apply. On 11 March Chile pre-paid its loan to the IFC. There are now specific plans for further developing the watercourse. Thus the precondition for our participation is no longer present. The Government has, therefore, after considering all aspects of the matter, decided to take the necessary steps to terminate the loan agreement on which Norwegian support is based.

The environment

In both Report No. 19 to the Storting and the ensuing debate in the Storting, the importance of a comprehensive focus on environmental measures when granting aid was underscored. Aid in the environmental sector has increased in recent years, and will continue to do so in the future. Last year, Norway granted close to NOK 1.4 billion in environmentally oriented aid, an increase of as much as 16 per cent in relation to 1995. Of this, NOK 555 million comprised support for specific environmental measures.

The strategy for development aid in the environmental sector has now been adopted. One of the main principles of this strategy is to strengthen the developing countries' own will and ability to resolve environmental problems. The main emphasis is therefore on support for the development and implementation of national environmental strategies and plans. The aid will cover measures to enhance institutional capacity and expertise, and the charting and monitoring of the natural resource base. Sustainable development will be integrated more fully into development aid, both by taking account of environmental considerations in the ordinary development cooperation projects and the country programmes and by directly supporting environment-related projects. In cooperation with the environmental authorities, the capacity of the aid administration to implement the environmental strategy has been considerably improved.

In 1996 preparations were begun for a special session of the UN General Assembly for the review and follow-up of the resolutions adopted at the UN Conference on Environment and Development in Rio (UNCED) in 1992. This event will take place in New York on 23-27 June this year, and is expected to result among other things in a new working programme for the UN Commission on Sustainable Development (CSD).

Norway will concentrate on achieving resolutions that are as binding as possible in a few areas. In our view, topics such as poverty reduction and the role of women in sustainable development should be key issues in the negotiations. We will also stress the importance of measures to follow up Agenda 21 that promote the broad participation of the civil society and a wide range of population groups. Similarly, we will seek to strengthen cooperation within the UN system and between the UN system and the development banks in following up the Rio conference.

Information

The focus on information activities referred to in Report No. 19 to the Storting has been followed up. In 1996 this was reflected in a sharp increase in aid for information activities.

We must also focus on expanding the network of contacts between people in Norway and people in developing countries. The best means of promoting insight and understanding is through direct involvement, such as through an NGO with which one is affiliated, through the company in which one is employed, through the development of contacts between academic institutions, or through cooperation in the cultural field. Earlier I mentioned the central role played by NGOs in development cooperation activities. Given the large network they represent, they also have a key role to play in connection with information activities in Norway.

Research

Norwegian research and educational communities are becoming increasingly involved in cooperation with institutions in the South. In 1996, steps were taken to facilitate closer research cooperation with institutions in Central America and South Asia and the initiation of new joint projects in the Palestinian administered areas and Vietnam. Another important priority area in 1996 was the building of regional networks to promote closer South-South cooperation. The Ministry is working on a strategy to further strengthen know-how and research related to Norway's relations with developing countries.

Culture

The bulk of our aid in the cultural field is targeted towards strengthening the developing countries' own cultural identity. Support is provided for a wide variety of activities, ranging from efforts to safeguard a country's own cultural heritage to measures aimed at disseminating information on culture and cultural exchanges. In this field, too, we note a strong interest in cooperation between institutions and organizations in the North and the South. NORAD has entered into partnerships with key Norwegian institutions such as Norconcert, the Directorate of Cultural Heritage, National Touring Exhibitions and the National Library of Norway, and will conclude an agreement with the Norwegian National Commission for UNESCO in 1997.

Evaluation

The purpose of development aid is to promote development. The activities are to yield visible results for the population in poor countries. This is why we attach great importance to finding means of consistently improving the quality of aid so that it yields the greatest possible development impact. Evaluation is an important part of this process.

A consistent effort has been made for many years to improve the evaluation of Norwegian development aid. In the past year, a systematic effort has been made to follow up both the new State Regulations for Financial Reporting and the Storting debate on Report No. 19. In this connection, the development of a more efficient system for performance management and quality assurance goes hand in hand with improvement of the evaluation function.

The number of studies completed this year will be more than double the number carried out in former years. At the same time, the evaluation process has become more heavily concentrated on specific topics.

The Ministry is now drawing up a proposal for ways of strengthening the evaluation function. The proposal deals with the way evaluation is organized, personnel resources and the actual system of evaluation. I would like to emphasize that evaluations are essential in order to provide us with a knowledge of the impact and results of Norwegian development aid. Evaluations must help to provide a sound basis for decisions concerning our aid profile in the future. We must also ensure that the evaluations carried out by the Ministry of Foreign Affairs are coordinated with all the performance reviews and reports produced by NORAD each year. Furthermore, it is important that we make use of the work done in international institutions to which Norway provides support.

The Ministry will attach particular importance to establishing a system to verify that the decisions made on the basis of evaluations are followed up and that the results of evaluations are systematized in the form of information to the Storting.

Since the presentation of Report No. 19 to the Storting, extensive efforts have been made to improve the budget proposal, the letter of allotment to NORAD and strategy documents for use as management tools for development aid. New strategies have been drawn up for efforts in the environmental sector and to promote gender equality and the role of women in development. A number of changes have been made in the budget proposal for this year, with a view to simplifying the budget structure and making it more coherent in relation to development aid goals. In the budget for next year, particular emphasis will be placed on providing a better overview, so that goals and priorities are more clearly visible than is the case at present.

In our contacts with priority countries, we discuss possible improvements in the system of country strategies and the agreements linked to these strategies. Among other things, we examine the possibilities of establishing more concrete, verifiable goals for cooperation.

The number of projects and donors has reached unmanageable proportions in many recipient countries. Priorities, requirements and working methods vary from donor to donor. The authorities in developing countries can easily lose both their overview and control, a situation we must help them to avoid. Improved coordination at the donor end will help to solve the problem. At the same time, we must emphasize aid that enables the recipient country to steer its own development. Capacity-building and institutional development will be key factors in this connection. We must also seek to structure aid in the simplest possible manner. In this connection, organizing aid in the form of sector programmes has, in our experience so far, proved to be an effective tool. Among other things, this means that all aid activities within a particular sector are subject to national priorities and plans, that the recipient itself is responsible for coordination and that reports to donors are coordinated. This is recipient responsibility put into practice. In designing country strategies in the future, I will consider greater use of this type of support, particularly as regards the social sector.

The setting in which development cooperation takes place is generally far from ideal. The challenges are many. We will never be able to guard completely against unforeseen problems and setbacks. However, with the work that is being done on quality assurance, I feel confident that we are now better prepared to meet the challenges ahead.

A will to act

The Government's Long-term Programme shows that Norway is prepared to continue to bear its share of the responsibility of rich countries towards developing countries. This is an expression of the principle of solidarity on which the Government bases its policy, and the democratic and humanistic values on which our society is founded. At the same time, we are aware that the situation of developing countries also has a bearing on our own future. In the long term, both the rich and the poor regions of the world have a common interest in combating poverty. Let us hope that the recognition of this common interest will gradually make a greater impact on the international community and be followed up by political action. It is only through the concerted efforts of countries in both the North and the South that we can have any hope of reducing poverty. The poorest developing countries will need our help to create decent living conditions for their populations for many years to come. Looking at OECD aid statistics, it is easy to understand why the poorest countries question the readiness of the rich part of the world to contribute to the joint effort that is required. Optimism and confidence in the future will have to be built by means of concrete action, increased development aid and greater concentration on the poorest countries.