107. Telegram From the Mission to the Organization for Economic Cooperation and Development to the Department of State1

CEDTO 1036. ADCOR. Subject: March 30 DAC meeting on TC coordination. Reference: TOCED 877.2 At March 30 DAC meeting Thorp re-elected Chairman for coming year and Pierre-Brossolette of French Delegation elected Vice Chairman.

Since this first DAC meeting since Austrian accession, Chairman welcomed Austrian Delegate, who made brief statement that Austria will strive to improve its performance in development field in coming years and cited fact that $2 million budgeted for Austrian TA for 1965 compared to $1.3 million in 1965.

Two agenda items of substance reported below: (1) objectives and methods for coordinating TA and (2) directory of non-profit organizations participating in TA. Third item, TA study in Thailand reported separately.

Methods of Coordinating TA . Secretariat’s presentation followed lines of DAC (65) 93 setting forth suggested elements of coordination, i.e., government-[Page 311]to-government coordination among donors-on-spot field coordination, and provisions for continuing consultation through “clearing house” arrangement. Parsons described three categories of LDCs in which organized coordination effort may be feasible (Annex C of paper): 1) LDCs where some coordination already exists under international auspices; 2) for those where UN programs constitute 30 per cent of total aid, UN could be asked to handle coordination effort; and 3) for those where bilateral programs constitute over 70 per cent of total, major donor could be asked to take lead in coordination effort.

Although all delegates favored principle of coordination and all felt Secretariat paper was good attempt to come to grips with problem, reaction was cautious and mixed. UK, France, Portugal and EEC considered Secretariat proposals too ambitious and felt that data-gathering requirements would overburden small donor Embassies in many LDCs. These delegates all expressed concern about DAC becoming involved in “operational” activities.

France and EEC stressed problem of relationship with LDC government and psychological ill effects on recipient of donor-imposed structure to police TA operation. UK acknowledged that this delicate issue but not excuse for ignoring need for coordination.

US, Canada, Germany and to lesser extent Japan, Belgium and Norway took more positive line. Indeed, Belgian Del even expressed view that DAC should not hesitate to undertake operational activities. US suggested DAC has contribution to make to coordination effort without operational involvement by 1) fostering exchange of information on TA projects to avoid duplication, 2) candid exchange and assessment of field experience to help improve aid coordination efforts, and 3) helping LDCs develop their own system or agency for coordination by analysis of factors, organizational and otherwise, necessary for effective coordination. German Del supported Secretariat paper but expressed reservations about role of UN as coordinator for List II LDC in Annex C. He stressed need for field coordination through regular and continuing consultation.

Canada observed that close on-spot field coordination particularly important for small donors.

Japan favored more informal on-spot coordination flexible enough not to overburden small Embassies.

In discussing next step, Chairman mentioned possibility of DAC sponsoring additional coordination groups in LDCs selected from List I of Annex C, citing Thailand example of what can be done. He acknowledged this would involve DAC to certain extent operationally, which several delegates had earlier opposed. He offered as alternative, general instructions to donor field missions through DAC capitals stressing need for on-spot coordination. US, UK and Canada spoke in favor this [Page 312] approach, with US Del addition that aid has sent instructions on coordination to its field missions on several occasions, but only limited results achieved on unilateral basis.

Chairman agreed to have Secretariat modify proposal in light of discussion and circulate it to delegates for consideration at second meeting, probably within one month. US, Canada and Netherlands expressed hope that proposal can then be taken up at high level meeting in July.

Comment: With several major donors opposed to DAC operational involvement and concerned about burdensome reporting requirements, as well as sensitive political implications of donor groups in LDCs, apparent that any effective DAC action towards improved coordination should begin with low key effort. Thus we support proposal for rather general instructions to field with hope of feedback of information (perhaps to capitals rather than directly to DAC) as first step which may have general support of all members. Would appreciate any comments from Washington as to nature of guidelines most likely to achieve serious field attention, and AID/W views as to which LDCs may be most appropriate candidates to additional coordination efforts. Any data AID/W has on which LDCs already have internal agencies for aid coordination (e.g., Thailand’s DTEC) would be of great assistance to Secretariat.

Secretariat later reported to us that they are well satisfied with results of meeting and that they fully aware proposals set forth in DAC (65) 9 more ambitious than many dels willing to accept. Secretariat considers “joint instructions” to field reasonable and appropriate first step to more effective field coordination.

Directory of non-profit organizations engaged in TA . Parsons reported ICVA offer to collaborate with OECD in compiling directory of European non-profit TA activities similar to report prepared for US by TA information clearing house. He stressed value of such study and advantages of cooperating with ICVA, along lines DAC (65) 6.4

UK Del asked if ICVA would share cost of project and would assume responsibility for keeping directory current. Parsons replied that ICVA will provide office space and services but that budgetary limitations preclude ICVA cost contribution. However, ICVA has given verbal assurances for maintenance of directory, possibly with help from foundation, since this is continuing requirement.

Canadian Del offered support for directory, assuming Canada included. Secretariat replied directory had been envisaged as European undertaking but that Canada could be included and that budget would be amended to provide at least one data gathering trip to Canada. This would leave Japan as sole OECD country excluded (US covered by earlier [Page 313] study). Japanese Del queried by Secretariat about GOJ interest in participation, but having received no instructions from Tokyo, he reserved GOJ position.

Belgian Del questioned value of directory, commenting that non-profit activities largely unrelated to real TA and suggesting UN as source of data on voluntary organizations. Secretariat replied that UN has compiled very little information on this subject and that many organizations formerly performing strictly missionary functions now concentrating more on true TA to respond to LDC needs identified in national planning documents.

US Del supported view that directory needed to fill gap caused by lack of data on relevant non-official activities. Based on US experience with TA clearing house, he encouraged OECD to accept association with ICVA as arrangement favorable to OECD.

There being no objection, it was agreed that Chairman would pass proposal to budget committee for approval.

  1. Source: Department of State, Central Files, AID 1. Limited Official Use; Priority.
  2. Dated April 2. (Ibid.)
  3. Not found.
  4. Not found.