# More Strategic and Effective Aid Implementation

Amidst Japan’s difficult economic and fiscal conditions, Japan will strive to implement more strategic aid and thereby maximize its effects within a limited budget.

### 1. Strategic Aid Implementation

First, in order to carry out strategic aid through “selection and concentration,” bilateral and multilateral aid policies will be decided with respect to each recipient country and organization, taking into account a program’s relationship to the priority areas of Japan’s development assistance, the recipient countries’ development goals, and their bilateral relations with Japan. Based on this analysis, Japan will assess the policy usefulness of providing assistance across countries and regions and extend assistance under the Priority Policy Issues for International Cooperation formulated in the beginning of every fiscal year.

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# OECD-DAC Peer Review of Japan

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The Development Assistance Committee (DAC) of the Organisation for Economic Co-operation and Development (OECD) has a peer review mechanism in place by which member countries examine each others' aid policies and approach. The purpose of the review is to enhance mutual understanding among member countries and improve the aid policies of countries under review and of other donor countries. Each member country is examined once every four to five years by other member countries and the DAC Secretariat.

Between 2009 and 2010, Japanese assistance was examined for the first time in approximately seven years. The team of examiners $ (^{*1}) $ visited Tokyo in October 2009. After interviewing the relevant ministries, JICA, and other organizations to assess the Japanese situation, the team made field visits to Bangladesh and Kenya in October-November to assess how Japan implements assistance. On May 20, 2010, a Peer Review Meeting was held among the DAC members at the OECD headquarters in Paris, and the OECD-DAC issued the Japan DAC Peer Review report on June 16.

The report praised the reform efforts made by Japan in recent years, including the creation of the new JICA, the organizational reform of the International Cooperation Bureau of the Ministry of Foreign Affairs, the strengthening of the functions at the field level, the increasing public support for ODA, and programs which respond to cross-cutting issues such as gender responsive programs. In addition, the report praised Japan's initiatives to improve aid effectiveness, including the enhancement of partnerships with NGOs, the coordination between ODA-related ministries, the expansion of assistance to Africa, the importance Japan attaches to the sharing of assistance-related information (accountability), the importance it attaches to building the capacities of developing countries, and Japan's support for South-South cooperation (cooperation between developing countries).

At the same time, the report identified issues for future consideration, including: (1) increasing the ODA volume; (2) strengthening efforts to promote policy coherence for development $ ^{(*2)} $ ; (3) further strengthening the government's relationship with NGOs; (4) establishing a public relations strategy on ODA; (5) establishing a strategy on contributions to international organizations; (6) streamlining project procedures further; and (7) improving the evaluation system $ ^{(*3)} $ . Many of the items pointed out are those which were discussed in the "ODA Review" that was implemented under the direction of the Minister for Foreign Affairs from February 2010, and Japan will address these items also taking into account the outcomes of the ODA review.