Tackling Aid Effectiveness from the Top: Microfinance as a Test Case - Policy Implications of the Donor Peer Reviews
Helms, B. & Latortue, A.
Publication Date: Jan 2003
Published by: Consultative Group to Assist the Poor (CGAP)
Document Type: Other
What are the policy implications of donor peer reviews?
This document synthesizes the findings of donor peer reviews launched by the Consultative Group to Assist the Poor (CGAP). These reviews address aid effectiveness by identifying success factors and constraints to good practices in microfinance and provide concrete recommendations for each agency. The report draws on findings from the first six reviews and a field visit to Uganda.
The peer reviews revealed agency strengths on aid effectiveness for better microfinance practices:
- Clarity on overall development objectives and international priorities;
- Commitment to better donor collaboration to leverage resources and tackle policy issues;
- Responsiveness to local priorities, increased flexibility and deepening country-level partnerships;
- Increasing recognition of the role of the private sector in poverty reduction;
- Increased investment in technical staff.
The review finds common challenges and recommendations in four main areas:
- Strategic clarity, vision, and organizational culture;
- Accountability for results by enhancing transparency on the purpose, content, responsibility and performance of the microfinance portfolio;
- Staff capacity and technical expertise;
- Knowledge management.
Finally, the reviews highlight common issues of concern for all agencies:
- Improving instruments to support financial services to the poor, in line with good practices;
- Determining the appropriate role of subsidies in supporting microfinance;
- Innovating to meet the challenges of rural finance;
- Collaborating at the field level;
- Updating guidelines to reflect lessons gleaned from the peer review process.
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