In Kenya, for example, donors are supporting the Kenyan Institute for Policy Research and Analysis to help develop local capacity for policy analysis and formulation. This kind of capacity building is not going to have a large payoff as long as vested interests block serious reform, but it is an essential foundation if a political movement for change develops. On the other hand, where donors fail to heed this advice and to differentiate between effective and weak national performers, large amounts of foreign aid can sustain poor policies, and delay key social and economic reforms. Attaching conditions to the aid in these cases has not successfully led to policy change, nor has it delayed the disbursement of funds. In general, donors have not discriminated effectively among different countries and different phases of the reform process, says the report.
Donors tend to provide the same package of assistance everywhere and at all times.
Lessons learned from two of the case studies are that donors should concentrate on technical assistance and other soft support without large-scale budget or balance of payments support in the phase before governments are serious about reform. If a reform movement develops, finance can be increased as policies actually improve. In the early stage of serious reform, political leaders and technocrats actually welcome conditionality in order to bind themselves to policy change. Lessons from Ten Case Studies , seeks to help the international development community direct foreign aid to poor countries most likely to use it effectively to achieve broad-based economic growth and reduce poverty. For those countries that cannot yet marshal popular support and political motivation to adopt a national reform process, the report can help both donors and aid recipients take the necessary first steps, with technical assistance and policy advice, to start the process towards national change.