For bilateral loans to the public sector, the minimum grant elements for qualification as ODA are also differentiated according to DAC income groups: 45% for loans to LDCs and other COUNTRIES, 15% for loans to LMICs and 10% for loans to MICM. For loans to multilateral institutions, the figure is 10 per cent. [Note: The concept of the grant element is not applied to market-based lending operations of multilateral development banks. Instead, they are classified as concessional if they contain a subsidy (soft window operations) and non-concessional if they are not subsidized (« hard window » operations). A 2016 report by the Overseas Development Institute (ODI) examines evidence related to six « allegations » that compare multilateral and bilateral channels that could influence donor decisions on aid allocation. The author finds strong evidence that bilateral channels are more politicized than multilateral channels (but notes that multilateral aid flows are also politicized), that aid recipients prefer multilateral channels to bilateral channels, and that aid dispersed through multilateral channels is often less fragmented than through bilateral channels (although he acknowledges that fragmentation is not always negative). The ODI report also cites moderate evidence that multilateral channels are more selective than bilateral channels and that multilateral channels are better providers of global public goods, but finds little support for the claim that multilateral channels are more efficient than bilateral channels, with evidence of lower administrative costs for bilateral aid. Geographical distribution of contributions from major donors to multilateral organizations based on the geographical distribution of disbursements from multilateral organizations for the base year. Our article reviews the results of overall bilateral and multilateral aid, which is likely to mask differences in effectiveness between donors, and some studies show differences in effectiveness for some donors.

Donor countries pursuing specific development goals can therefore, in addition to the factors set out in the ODI document, assess whether some multilateral organizations have been more effective in achieving these goals in similar contexts. Although none of the studies reviewed report separately on the impact of multi-bilateral aid, future research could assess whether the proposed benefits of the aid thus provided, as proposed in the ODI report, lead to a stronger impact of multi-bilateral aid on development outcomes. The author suggests that donors use bilateral channels to achieve the goals of aid control, accountability and visibility, and use multilateral channels as they strive to pool resources and advance a common global cause. He argues that « multibid » aid – provided voluntarily to multilateral organizations but intended for specific purposes – can offer an opportunity to reap the benefits of both channels. From the donor`s perspective, the term multilateral official development assistance (ODA) is a measure that represents flows from a government to multilateral organizations. These are also called core contributions, as the donor country does not usually specify which projects and programmes are to be funded. Core funds are also used to cover the overhead costs of multilateral organizations. Multilateral organizations may also receive funding from other sources such as public or private donors. Humanitarian aid can be seen as a targeted, shorter-term version of bilateral aid. For example, humanitarian aid from rich countries poured into the coastal regions of South Asia after a magnitude 9.1 earthquake triggered a tsunami in the Indian Ocean that killed more than 200,000 people. Because it tends to be better known than other types of aid, humanitarian efforts receive more private funding than most other types of aid. A recent paper by Pierre Biscaye, head of research and strategic initiatives at EPAR, and lead researchers Travis Reynolds and Leigh Anderson, published in the Review of Development Economics, has a slightly different focus than the ODI report.

The paper, which builds on previous EPAR research, examines the literature`s arguments on the comparative advantages of the two aid channels and analyses published evidence of the relative effectiveness of bilateral and multilateral aid for development results. We identify eight key attributes of aid channels to attract development funds and profitability to achieve development results. Multilateral aid is seen as having benefits in supporting development results because of its development-orientedness, conditionality of aid from development-enhancing reforms, legitimacy of beneficiaries, specialization and expertise. Bilateral assistance is considered to have advantages because of its strategic orientation, responsibility and institutional compatibility between donor countries and recipients, often former colonies. Although multilateral aid is less fragmented, we note that bilateral aid can minimize overall transaction costs, which is reflected in the findings of the ODI report. Official financing for development is measured only in terms of the revenues of developing countries, not for individual donor countries. It is a general measure of the government revenues of developing countries for development purposes and is defined as the sum of bilateral flows of ODA, bilateral OFF, with the exception of grants and loans from the EDF for commercial purposes, and all grants and loans from multilateral development institutions, regardless of the component of lending. In DAC statistics, international institutions that are members of a government that carry out all or a substantial part of their activities for the benefit of developing and aid-receiving countries. These include multilateral development banks (e.g. B World Bank, regional development banks), United Nations agencies and regional groupings (e.g.

B certain organizations of the European Union and Arab organizations). A contribution by a DAC member to such an organization is considered multilateral if it is combined with other contributions and made at the discretion of the Agency. Unless otherwise specified, capital subscriptions to multilateral development banks are presented on a deposit basis, i.e. at the amount and time of delivery of the letter of credit or any other relevant negotiable instrument. Limited data are available on the basis of recovery, i.e. at the time and amount of each drawing made by the Agency on letters or other instruments. See the list of DAC multilateral donors. Multilateral aid represents the basic contributions from official (governmental) sources to multilateral organizations, which are then used to fund the multilateral organizations` own programs.

Official development assistance (ODA) to multilateral development organizations of donor countries or institutions, bundled and used to cover the current and programming costs of an agency, which means that it loses its identity and becomes an integral part of the financial assets of the recipient institution. Non-core funding may include cases where the donor indicates how the money will be spent. In addition to the ODFs, the inflow of funds to support beneficiary countries also includes official and private export credits as well as long-term private transactions (see private flows). Total revenues are measured minus capital payments and repatriation of capital by private investors. .