Advance Notice: Evaluation of the Transition Towards a New Partnership with Egypt
Invitation to tender will be opened in late May.
1. Subject of the Evaluation
Egypt is one of the world's largest recipient of development assistance and the second largest recipient of the US aid. Other big donors are EU and Japan. The general trend in the development cooperation with Egypt is a gradual decline of the aid funds. In addition, the donors are attempting to concentrate on fewer sectors and to channel the aid through the international organisations. There is also a shift towards assistance to local and grassroot level and support to commercial associations.
The joint theme among the donors is a more intensive coordination and coherence of the aid. There have been also discussions on possibility to move towards sector programmes and budget support of which there are already some examples (Trade Enhancement Program, Industrial Modernisation program, Health Sector Reform).
Egypt is one of Finland's oldest development cooperation partners. Cooperation began in 1977. The total volume of the Finnish assistance over the 20-year period was FIM 854 million (cirka €) 65% of which was disbursed during the 80'ies The nature of assistance has undergone some changes during the years, the main one being the dropping of the energy sector and inclusion of the environment sector in the 90'ies. Partly this coincides with the economic recession in Finland in the first half of the 90'ies. The principal sectors have remained practically the same i.e. agriculture, water and sanitation and health care. Especially in the 80'ies the assistance was scattered over a big number of projects. In the 90'ies the aid was starting to be more concentrated when the projects from the 80'ies were gradually phased out. Between 1980 and 2000 the largest sector of the Finnish assistance was energy (43%) followed by the water and sanitation, agriculture, health and environmental sectors.
A decisive event was the decision taken by the Finnish government in 2001 to gradually discontinue development cooperation with Egypt, Peru and Namibia. The new development policy preferred to concentrate the external aid to the LDCs. The three above countries do not fulfil the criteria of the LDCs. In practise this decision meant that a clear exit strategy was needed. The Ministry for Foreign Affairs of Finland (MFA) estimated that approx. three to seven years would be needed for the transition towards a new type of partnership with these countries.
The development cooperation between Egypt and Finland was evaluated in 2001. It came up with very general recommendations. Grant aid should not be totally abandoned while concessional credits should not be martketed (Egypt has never received concessional credits but development credits which were forgiven and converted into grant). The MFA was encouraged, however, to develop new instruments for business partnerships. The evaluation recommeded also regional programmes, multilateral cooperation as well as thematic cooperation and NGO and LCF cooperation.
The good relations between Egypt and Finland are founded on long-term development cooperation. Egypt is one of the leading Arab Countries and it plays a central role in the Middle East Peace Process. It is also an active cooperation partner to many developing countries and to the rest of Africa (NEPAD). These are all fact that argue for the fact that Egypt continues to be an important partner for Finland even though the development cooperation was decided to be discontinued.
A process of transition was started in close cooperation with the Egyptian authorities. The beginning was not easy as the Egyptian authorities did not want the development cooperation to cease. A Transition Strategy and Action Plan was approved in January 2005. According to it the objective is "to support Egypt in implementing its own and wider Arab modernisation and reform initiatives both bilaterally and by participating in the dialogue between Egypt and the EU". Environment and information society were selected as priority areas. A limited amount of official development funds will be available as a catalytic tool for private sector participation and for cooperation between public institutions. Also multilateral cooperation can be funded by ODA. Concessional credits are included in the instruments that can be used to support the Egyptian priorities. EIT (Economic, Industrial and Technological) appopriations can be used as seed money to support for ex. various type of studies, project planning, training and exchange of personnel. Finnfund and Finnpartnership programmes can facilitate the cooperation with the private sector. In addition, ODA financed Local Cooperation Funds (LCF), administered by the Embassy, are available as well as funds to support Student and Researcher exchange administered by CIMO (Centre for International Mobility) under the Ministry of Education.
The general aim is that bilateral, regional and multilateral cooperation complement each other. It is also assumed that after the expiry of the transition period other actors in the public and private sectors will assume a more central and active role based on their own initiative.
2. Evaluation Purpose and Objectives
The main purpose of the evaluation is to assess to what extent the objectives set for phasing out of the traditional bilateral development cooperation between Egypt and Finland have been achieved and whether the vision, strategy and the actions mutually decided upon have led to expected results and to the satisfaction of both parties. The evaluation shall be future-oriented, based on solid evidence to be extracted from the experiences since 2002 when the process started. The evaluation shall focus on legislative and policy level issues, on development of relations between public and private sector and business communities, on CS actors of both countries as well as on research and innovative activities and particular aspects relevant for furthering the transition towards new type of partnership between the countries. Special attention shall be paid also to the instruments used for the transition and their usefulness.
The objectives of the evaluation are:
- Comparision between the situation now and during the first half of this decade in the relations between the two countries paying attention to the evolving context in both countries and, if necessary, also at global level. Analysis of past experiences and lessons learned that have or could have served as building blocks for new sustainable basis for relations;
- Professional external view on the strengths, weaknesses and possible limitations in the approach and realisation of the transition activities; particular focus should be on capacities, resources of both countries to involve in new type of approach and instruments used in the process.
- A realistic and innovative view on opportunities and new openings for enhancing and up-scaling the relations between the countries;
- Recommendations on specific approaches and instruments that could serve as drivers for further shaping the way.
The main users of the evaluation results are the MFA decision makers, advisors and desk officers and the Embassy of Finland in Cairo - and more broadly the public institutions in Finland and the private sector actors. The results of this evaluation may be beneficial also for similar transition plans in other partner countries of Finland and give ideas on what may or may not work in promotion of the transition from pure grant assistance to new more multifaceted partnerships.