29/09/2004 - Italy's net official development assistance (ODA) in 2003 was USD 2.4 billion, making it the world's seventh largest donor. This level represented 0.17% of Italy's Gross National Income (GNI). Italy committed in Barcelona (2002) to an ODA/GNI target in 2006 of 0.33%, representing a massive estimated 113% increase in real ODA (USD 2.7 billion) over the 2003 level.

The OECD Development Assistance Committee Peer Review of Italian development co-operation notes that obstacles to achieving this target include the ongoing, government-wide pressure for budget austerity and the exhaustion of remaining debt relief as an element of ODA by 2006. The Committee notes Italy's continued resolve to achieve this target and encourages it to make every effort to do so. Also the DAC notes current government preference to use the bilateral channel. In view of recognised shortages of bilateral staff and the limited use of new funding modalities, it will be necessary also to make use of multilateral channels for such a major increase in ODA. 

In its Review, the DAC commends Italy's international initiatives for development. New commitments have included substantial debt relief, a lead role in the Global Fund to Fight AIDS, Tuberculosis and Malaria, the hosting of both the Palermo initiative on e-government and the Rome High-Level Forum on Harmonisation, as well as an active role in the reconstruction of Afghanistan and Iraq. The Committee welcomes Italy's continuing focus on Africa.

These initiatives have created expectations in the international community which will be difficult to attain unless substantive reforms in Italian aid are undertaken, such as those advanced in the previous DAC Peer Review in 2000. Progress in implementing reform has been limited and a 1987 Law still constrains aid administration, while providing little strategic guidance. The Committee still believes that appropriate legislative reform is a priority, but this should not delay actions that can be taken within the present framework. In this connection, the DAC recommends that Italy now act to affirm a clearer sense of strategy in its development co-operation, including an effort to make other policies across government more coherent from a developmental perspective. This could entail a more clearly stated government vision for development co-operation based on Italy's strong support for the Millennium Development Goals, a more strategic allocation of Italian ODA resources based on this vision, and the assignment of authority for development at a more political level (e.g. Deputy Minister for Development). The Committee also encourages a higher level and more organised public dialogue, including Parliament, on policy and strategy. The Committee welcomes initiatives taken to broaden public support and encourages the government to develop a strategy to this end.

The DAC suggests that Italy could realise significant efficiency gains through improved collaboration and co-ordination at all levels - among all Italian official and non-governmental development institutions, between headquarters and the field, and among various entities in the field. In Rome and in the field, procedures could be streamlined. Funding, once decided, could be delivered in a timelier manner. And all procedures should be revised in tandem with ongoing efforts to comply with harmonisation principles agreed to in Rome in 2003 and to facilitate co-operation with other donors. The Committee urges that longstanding personnel issues, including the need to increase professional development staff, to increase flexibilities among various personnel categories and to develop a performance-based system for allocation of staff responsibilities and incentives. Finally, and consistent with development experience elsewhere in the world, the DAC urges Italy to establish a routine system of performance feedback for its aid programming, including a robust, independent evaluation function.  

The DAC Peer Review of Italy's development co-operation policies and programmes took place on 28 September 2004. The meeting was led by the DAC Chair Richard Manning and the Italian Delegation was headed by Giuseppe Deodato, Director-General for Development Co-operation, Ministry of Foreign Affairs. The examiners for this Peer Review were France and Sweden.

The main findings and recommendations of the DAC regarding this review will be published on the OECD web site, at www.oecd.org/dac , during the week of 4 October 2004.

For further information, journalists are invited to contact Helen Fisher, OECD Media Relations Division (Tel: + 33 1 45 24 80 89)

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