Will Kosovo rise with 2b bucks (New Kosova Report)



Donors & field: Will Kosovo rise with 2b bucks By Ari Rusila

Monday, 17 November 2008

ImageThe European Union hosted a donors’ conference for Kosovo in July 2008 and collected 1.5 billion Euros. This was to aid Kosovo in turning away from aid-dependency to a viable self -sustaining economy. The Unites States is throwing in some $400 million along with $200 million from Germany which form the biggest two donors at country level. It is fair that their taxpayers know a little bit more about where their money is going. Indeed, the people of Kosovo have the right to know what to expect from all of this.

Here are some of my experiences with Kosovo.

The long road from conference to field:

  • Donor’s conference ends with a statement or promise to give some estimated sum of money to Kosovo. If this promise is kept or not we shall see. In many similar conferences, the implemented figures have been more or less short of the original promised sum.

  • When some of the donor money is actually paid, the donors will pay for it directly, so in most cases the donating country takes a percentage from the country it is donating to (i.e. Kosovo). This is used for own administrative costs as well as sending some to the management authority.

  • When the relevant management authority (receiving country, outside agency, consultant …) gets the charges-deducted sum, they then take off their own administrative costs.

  • Depending on programme or management practices, there can also be some intermediate organizations or intermediaries with their administrative costs.

  • After this process, the rest of the donor money is almost ready for the beneficiary. How much money goes all the way depends on local administration practices, level of corruption, price fixing/cartel, previously agreed contracts and different needs by local interest groups.

Money goes, report arrives

There is a big gap between the original donor’s ideas and the real effects of their donation on the field. The EU has given some €500-800 million during the period 1999-2007 to the Kosovo power plant. People in Kosovo, however, still suffer regular power cuts. This is despite an army of different international management groups (the first batch of managers are already in jail, others should be), consultants, development projects, training activities, infrastructure investments and reports. The new power plant is probably the biggest investment in the future of Kosovo and will probably be in receipt of a large proportion of the donor money.

Earlier, some donors gave money to build a school in a Kosovo village. After the school was ready, nice photographs for the donor’s media were taken. A report confirmed that the building was safe and that the tendering procedures were made with some standards and the audit did not find anything special to report. So, a perfect project to satisfy donors? No one however, pointed attention to a small detail that there were no pupils for the brand new school. Similar examples are bridges, roads and swimming pools in the middle of nowhere, housing for returnees (empty because people are not returning or turning back upon arrival).

The lesson learned here is that a perfect report does not mean that a positive development has occurred in reality. Reports are describing how money is spent. A more effective means is to concentrate on the challenge of what to do with donations. Time is also another dimension – certain needs during donors’ conferences are not necessary the same later when the money actually starts arriving at destination.

My point of view is that money is only one of the means – one part of the resources. The more important part is vision, objective, strategy, implementation, feedback and especially commitment to the beneficiary groups and project management.

Some improvements

Certain improvements can be made by applying the Logical Framework Approach to the process. LogFrame is used in most EU projects, but individual donors have their preferences. LogFrame describes objective action lines: how individual projects are implementing the objectives and how the success can be measured. There is also some flexibility according to feedback gotten during implementation. Special needs at individual project and local levels also need to be considered, that of ‘Participatory Planning methods’ to ensure that all stakeholders can commit to actions.

These two practices do not remove the aforementioned problems but they can have a positive impact of allocating money to more desired destinations.

Serbia is one of the biggest donors in Kosovo distributing their aid mainly to the Serb populated north and some random enclaves around Kosovo. In this instance, there is a good possibility of integrating aid to national and local development programmes. In the case of the donors’ conference, the challenge is much, much bigger because of the diversity of donors and secondly because of the huge chaos in Kosovo’s administration system, between numerous international organizations and local administration. The bottom line is to know essentially how to use the resources and money that is arriving on the ground.

Ari Rusila is a development project management expert with experience in the Republic of Kosovo.



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