Top 5 reasons the US should join IATI

The International Aid Transparency Initiative (IATI) is both a global voluntary initiative and a common standard for publishing aid information that aims to make it “easier to access, use and understand.” It was formed following the 2008 Accra Agenda for Action as a way to implement those commitments made by donors in Accra on aid transparency. Twenty-one donors covering more than 50 percent of overseas development assistance flows have signed on to IATI, and 22 partner countries have endorsed it. In order to achieve its goals — like helping governments in developing countries manage aid resources more effectively or allowing citizens in both donor and partner countries to better monitor aid spending and reduce corruption — it needs to encompass a much broader range of donors and aid flows, and be fully implemented.

Although the United States has made great strides in the last year on aid transparency — largely through the foreign assistance dashboard — it is still only an observer to IATI and not a full member. With the Busan High Level Forum on Aid Effectiveness convening in just one week, the time is ripe for the US to solidify its commitment to aid transparency and demonstrate global leadership in this area. To make the case, we have developed a list of the top five reasons the US should join IATI:

5. Because its record on aid transparency is lacking. Let’s be honest, the US hasn’t measured up so well on transparency rankings and indicators in the past. Publish What You Fund recently released their pilot Aid Transparency Index, showing five of six US aid agencies to be poor or very poor at publishing their own aid information. PWYF recommended that the US agencies provide more and better aid information through the dashboard in line with the IATI standard. The Brookings-Center for Global Development QuODA assessment shows that the US is faring slightly more positively, but still ranking 12th out of 31 donors on the transparency and learning dimension. Joining and implementing IATI would improve the United States’ standing significantly.

4. Because the US needs to turn rhetoric into progress on aid transparency reforms. What the rankings above don’t show is that the US has made great strides this past year in improving the transparency of its aid information. Last year’s creation of the foreign assistance dashboard was a big step forward in creating an accessible repository of information on US foreign assistance. But getting US agencies to post their aid data has been slow, and for the past year only State and USAID’s Congressional Budget Justification information was available. In a welcome move, this week MCC became the first agency to publish their planning, obligation and spent data. In September President Obama made new commitments, as part of the Open Government Partnership, to direct all federal agencies that administer foreign assistance to provide timely and detailed information on budgets, disbursements, and project implementation in a format that is internationally comparable. Joining IATI would help to deliver on this important commitment while solidifying US pledges to improve the quality of its aid.

3. Because information is power. Knowing how much money the US is spending, where, and on what will allow decision makers to better plan for and manage our own spending on global development and will allow for better accountability to taxpayers. Aid information should ultimately be useful for partner countries planning their own domestic budgets as well. If developing countries don’t know how much aid they are receiving or where it is being spent, they cannot effectively plan spending from their own budget to target development objectives. By joining IATI, the US will be publishing information in line with an international standard that will allow its aid to be compared across the board with other donors, potentially leading to a higher degree of accountability and coordination.

2. Because resources are limited. In a time of dwindling budgets and tough cuts, improving the transparency of aid is essential for the efficient and effective use of resources. And aid transparency is a necessary first step in improving accountability and enabling effective spending. By comparing transparency scores on the Aid Transparency Index with the 3 other dimensions of aid quality on the QuODA assessment, Owen Barder has noted that transparency and aid effectiveness are strongly correlated. He finds that “well-governed and well-managed aid agencies are likely to be both more effective and more transparent.” Joining and implementing IATI will be a huge step in improving the accountability of US foreign assistance.

1. Because global leadership can convince others to adopt smart policy changes. The US continues to be the world’s largest bilateral donor, disbursing over $30 billion in official development assistance in 2010. If the US and other IATI observers, such as France and Canada stepped up to join IATI, the coverage of overseas development aid flows would increase to 86%. By joining the EU, UK, World Bank and other sizeable donors who have signed onto IATI, US leadership at the Busan High Level Forum and beyond could help persuade those countries still on the fence about making further strides on aid transparency.