Mozambique Political Process Bulletin

Issue 39 Editor: Joseph Hanlon (j.hanlon@open.ac.uk) Material may be freely reprinted.
10 June 2009 Deputy Editor: Adriano Nuvunga Please cite the Bulletin.
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Published by CIP and AWEPA
Formerly Mozambique Peace Process Bulletin (Prior issues available online: http://www.tinyurl.com/mozamb)
O Boletim também está disponível em Português: http://tinyurl.com/mz-pt-sub
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‘Disappointing’ performance
means no extra budget support
Donors were prepared to give Mozambique increased budget support, but decided not to because of the government’s “disappointing performance” last year, particularly with respect to justice and economic development, according to Frank Sheridan, Irish ambassador and head of the G19 group of budget support donors.
He was speaking at an aid pledging ceremony on 28 May, and added that “a number [of donors] have specifically asked that we highlight that they had scope to increase their budget support for 2010 if the results had been better” and that “allocations are less than might otherwise have been possible”. Of 40 agreed targets, the government met only 20 – down from 24 in 2007.
Aid should “not be taken for granted,” warned Sheridan. “Some sectors really do need to improve their performance.”
In the strongest statement, Sheridan said: “We hope and expect that the actions promised in the field of anti-corruption will be fully carried out this year. These are issues which realistically cannot be raised routinely on an annual basis without having some progress to report.”
Donors also “encouraged” government to improve the business environment, “tighten up on the sustainable use of natural resources”, and take action regarding the application of the land law to communities.
In a contentious point, donors also call for government to apply the Labour Law “in as commonsense a way as possible”. This is apparently support for US embassy and business pressure to allow NGOs and companies to bring in more foreign workers.
Meanwhile, donors have only met 11 of their 18 targets, but there is no punishment for donors which do not keep their promises. (See page 5)
2010 budget support
to be $472 mn
One donor, Sweden, has reduced budget support, by 3%. Two donors have increased budget support. Canada doubled its budget support, in keeping with long term plans, and the World Bank decided to provide as budget support the extra $40 million being given as support during the global financial crisis. The other 16 donors maintained their level of support, although some had planned increases.
The total budget support for 2010 will be $472 million, compared to $445 mn in 2009. The four largest budget support funders are the World Bank ($110 mn in 2010), the UK ($69 mn), the European Commission ($67 mn), and Sweden ($42 mn).

For the first time, the budget support donors and their two associate members, the US and UN, have also published details of sector support, which will be $374 in 2010.
Who are the G19?
Mozambique has the largest group of donors involved in the provision of general budget support in Sub-Saharan Africa. The 19 donors are known as the G19 or Programme Aid Partners (PAPs, Parceiros de Apoio Programático). They are: the African Development Bank, Austria, Belgium, Canada, Denmark, the European Commission, Finland, France, Germany, Ireland, Italy, the Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, the United Kingdom and the World Bank.
The International Monetary Fund is a non-signatory but ex-officio member. The United States and the United Nations are Associate Members. This is a new status agreed in March for non-budget support donors, which came about because the G19 had largely taken over policy dialogue with the government, and two large non budget donors, the United States and Japan, objected to their marginalisation.
The G19 is governed by what it calls the “troika plus”. Each year a budget support donor is elected to the troika for three years, and is chair in the second year. The “plus” are the European Commission and World Bank, described in the MoU as the “two most influential PAP donors”.
The present troika is composed of Ireland (in its final year; ambassador Frank Sheridan was chair last year), Finland (with ambassador Karl Alanko as chair), and the UK (which has just joined, replacing Norway).
There is a Performance Assessment Framework (PAF) which currently contains 40 indicators, which are evaluated each year in a donor-government joint review. The results are published as an aide-mémoire with various background documents. This year there were 29 sectoral working groups which met frequently in March and April.
There is also a mid-year review in August and September which considers the plan and budget before it is submitted to parliament.
Tables of commitments for 2010 are on pages 3 and 4.