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Study on Korea’s ODA for Fragile States in Asia economic development, economic cooperation

Author KWON Yul, LEE Sang Mi, and YOO Aila Series 15-01 Language Korean Date 2015.12.30

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As Sustainable Development Goals (SGDs) were adopted in New York in September 2015, attentions on fragile states, where most of people under the poverty line have lived in, have been increased. Because SDGs will more focus on marginalized people in terms of economic and social perspective, it is important to address issues related to fragility in fragile and conflict-affected countries.
Major donors have recognized importance of supporting fragile states since 1990 and they have established separate strategies and reflected it into country assistance strategy. They especially emphasized on supporting fragile states in order to achieve Millennium Development Goals (MDGs). However, 43% of the world’s poor now live in countries and economies on the 2015 OECD fragile states list, by 2030, poverty could become increasingly concentrated in fragile states.
Therefore, it requires much more effort to reduce poverty and development issues in fragile states such as peace-building, state-building, and humanitarian aid.
Prime Minister’s Office of Korea released 24 priority partner countries for 2016-2020 in early 2015. Among them, 8 countries are categorized as a fragile state and 5 out of 8 belong to Asia. Korea plans to establish new Country Partnership Strategy (CPS) for priority partner countries. Because proportion of fragile states among priority partner countries is high, it is necessary to have cooperation strategy for them before establishing CPS.
This study will analyze definition, standard, major categorizations and characteristics of fragile states as well as discussions on assistance to fragile states. Especially this research chooses Myanmar and Nepal, which were least developed countries (LDCs) as well as fragile states, for case study to figure out how donors and Korea support them in perspective of fragile states.
This study is organized as follows: Chapter 1 describes the objectives, ranges and structure of the research. In Chapter 2, it explains recent trends and issues about fragile states in the international community and analyzes major characteristics of fragile states by reviewing definitions and standards and classification and its criteria. Especially it covers discussions and issues under the OECD Development Assistance Committee (DAC), International Network on Conflict and Fragility (INCAF), and Post-2015 framework. Chapter 3 gives general description on development and characteristics of fragile states in Asia.
Especially it selects Myanmar and Nepal as objects of case study and draws implications for establishing Korea’s new CPS by analyzing their recent development conditions and needs and international communities’ support on them in perspective of fragile states. Nepal’s fragility is studied in terms of violence, justice, institutions, and economic foundation as well as environmental fragility caused by earthquake in early 2015. Also it looks into how major donors, such as the UK and Asian Development Bank (ADB) support Nepal as a fragile states. In case of Myanmar, the study focuses on fragility related to violence, institutions, justice, and conflicts caused by ethnic minority issues and also review how Japan and EU assist Myanmar to reduce fragility under CPS. In Chapter 4, it analyzes current status and policy how Korea has supported fragile states in Asia based and derives policy implications on how Korea should prepare a strategy for supporting fragile states and improve CPS by incorporating characteristics of fragile states into it.
Korea’s policy for supporting fragile states has concentrated on emergency relief and humanitarian aid to recover and reconstruct the country after conflicts or disasters including peacebuilding activities. In order to help fragile states to reduce its fragility and reduce poverty, however, Korea should establish systematic strategy for assisting fragile states beyond refined supports such as emergency relief or humanitarian aid.
First, Korea should clearly set up definition of fragile states, select the proper target country for development aid, and then establish CPS along with the characteristics of fragility each country has. Because every fragile state has different ranges of fragility, it is necessary to strengthen the country-specific approach when establishing and operating CPS. Therefore, it should take precedence to implement comprehensive analysis on how and why fragility could affect development environment and implementation of ODA programs in the country by studying fragile situations, politics, economic situation, and social and cultural aspects.
Furthermore, when establishing CPS, it is need to provide performance objectives and indicators. If objectives and indicators related to fragility are suggested in the CPS, the effectiveness of operation of CPS could be improved by regular and systematic monitoring and evaluation. Due to incorporation of performance objectives and indicators in the CPS, connection between the strategy and each ODA projects could be strengthened and clear direction of the project could be secured when conducting aid programs to fragile states. As studied in Chapter 3, Korea could refer to the cases of major donors who emphasize concrete action plan and evaluation frameworks established through detailed preliminary analysis.
Lastly, comprehensive connected ODA programs under the CPS should be provided in order to improve the effectiveness of development cooperation in fragile states. It is crucial to establish comprehensive strategy considering fragility into the CPS and implement proper ODA programs based on the CPS. In order for that, it is necessary to figure out the way to effectively link grants and concessional loans. In addition, when providing aid to fragile states, it is important to consider to division of labor and harmonization among donors. Therefore, Korea should reinforce basis for cooperation with other donors by pursuing country program-based approach, such as budget support or pooed funding. 

 

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