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Fragile and conflict-affected states face daunting challenges for development. Aid has a greater importance on development in these states than in others, and therefore aid effectiveness-management and delivery of aid-bears serious consideration. Despite its significance, aid effectiveness is appreciably lower in fragile and conflict-affected states than in others. What are the key aid effectiveness challenges in these states and how can these issues be better addressed? As important initial steps, this paper aims to identify (i) aid effectiveness challenges facing fragile and conflict-affected states and (ii) good aid effectiveness examples using the results of the Survey on Monitoring the Paris Declaration on aid effectiveness, which was designed as a mechanism to support global and country level accountability. Both fragile and conflict-affected states (recipients) and development partners (providers) are mutually accountable for aid effectiveness; therefore, this paper focuses on both sides. While the analysis confirms the significantly lower aid effectiveness performance in fragile and conflict-affected states-especially on aid on budget, aid predictability, and use of country systems-good performance examples in several of these states are identified. The aid effectiveness performance of development partners in fragile and conflict-affected states differs significantly across different groups. Multilateral development banks and other multilateral organizations perform better on average than bilateral organizations and vertical funds. Disaggregation of development partner performance at the institutional level and the partner country level enables the analysis successfully to identify good performance examples. In using the results of this paper to improve aid effectiveness, key additional steps should include (i) considering whether the identified challenges are essential; (ii) analyzing the factors/reasons behind good performance examples; and (iii) discussing whether good performance examples can provide lessons that can be adapted and applied.

Aid Effectiveness --- Banks & Banking Reform --- Country Strategy & Performance --- Development Economics & Aid Effectiveness --- Disability --- E-Business --- Fragile and Conflict-Affected States --- Macroeconomics and Economic Growth --- The Paris Declaration Survey

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The World Bank Group has identi?ed support to fragile and con?ict-affected states as a strategic priority. This paper provides a systematic portfolio review of the International Development Association-funded projects in fragile and conflict-affected states during 2001 to 2013 and a detailed empirical analysis of the correlations between project and country-level characteristics with project outcome ratings. The portfolio review identi?es a decline in the proportional amount of resources directed to fragile and conflict-affected states and a decline in the number of internationally recruited staff based in these countries. The empirical analysis ?nds no statistical difference in whether projects obtain at least a moderately satisfactory outcome rating between countries that are fragile and conflict-affected states and those that are not. Examination of the distribution of project outcome ratings indicates that projects in fragile and conflict-affected states obtain slightly lower ratings conditional on being unsatisfactory or satisfactory. Detailed cross-section regression analysis ?nds that indicators of project complexity, such as supervision costs, staff time, preparation time, and ?nancing, are correlated with lower outcome ratings. Project leader characteristics are correlated with project outcome ratings, but to a lesser degree in fragile and conflict-affected states, potentially indicating that it is more difficult for project leaders to in?uence project outcomes in these environments. Last, a new approach to control for unobservable project characteristics, such as inherent complexity or ambition, shows preliminary evidence that changes in the project leader and increases in the supervision budget are correlated with improvements in project performance.

Banks and Banking Reform --- Communities & Human Settlements --- Country Strategy & Performance --- Finance and Financial Sector Development --- Fragile And Conflict-Affected States --- Gdp Growth --- Housing & Human Habitats --- Poverty Monitoring & Analysis --- Poverty Reduction --- Project Complexity --- Project Outcome Ratings --- Project Performance --- Rural Development --- Rural Portfolio Improvement