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> Process of K-ODA

Process of K-ODA

Policy-Making Process for ODA

The CIDC, chaired by the Prime Minister, is the highest level government body charged with determining Korea’s ODA policies. As set out in Article 7.2 of the Framework Act, the committee consists of the Prime Minister, ministers of related ministries and heads of public institutions and civilian experts. Although it is not explicitly stipulated in the law, the committee holds three meetings each year on average. Based on the Framework Act, the CIDC adjusts and reviews the medium-term strategies for development cooperation as well as the Annual ODA Implementation Plans, deliberates and decides on issues for ODA policy improvements, and evaluates Korea’s ODA policies and programs. During each meeting, the Chairperson and committee members may submit agenda items for deliberation and, if they are selected, the members discuss such items at the meeting. If more than one-half of participants consent to inclusion of an item onto the agenda, this will be approved and reflected in Korea’s ODA policy accordingly.
   Before any agenda item is put on the table at a CIDC meeting, the Working Committee for International Development Cooperation coordinates it in advance. The Working Committee is chaired by the first Vice-Minister of the Office for Government Policy Coordination, and consists of director general-level officials from government ministries, executives from public institutions, and civilian experts. The Working Committee carries out in-depth review and discussion of proposed agenda items, so as to resolve any issues and differences of opinion among participating members. When this consultation and coordination process has been completed, and the proposed agenda items finalized to reflect the opinions of members, they are officially passed on to the CIDC meeting for deliberation.
As to matters related to performance assessment of ODA, prior to the Working Committee meeting, the Expert Committee for Evaluation, including director general-level officials from the MOEF and MOFA, executives from the EDCF and KOICA, and civilian experts, is organized, which is chaired by the Deputy Minister for Planning and Coordination of the Office for Government Policy Coordination. The Expert Committee for Evaluation directly selects and evaluates tasks that need to be urgently improved to ensure the consolidated implementation of ODA (Sub-Committee Evaluation), and reviews and approves the self-evaluations conducted by other organizations involved in ODA provision. Matters decided on by the Expert Committee for Evaluation are handed over to the Working Committee meeting and, subsequently, to the CIDC meeting for resolution and incorporation into policy.
   Since the CDIC's first meeting on March 2, 2006, there had been a total of 35 CIDC meetings held as of Octover 2020. Through its meetings over a period of a decade, the CIDC has been deeply involved in major milestones in the history of Korea’s ODA by deliberating on, reviewing and approving the following: Korea’s accession to the DAC of the OECD, its 「ODA Advancement Plan」, the 「Establishment Plan of the Korean ODA Model」, the 「First Mid-term Strategy for Development Cooperation (2011-2015)」, the 「Second Mid-term Strategy for Development Cooperation (2016-2020)」, the 「Annual ODA Implementation Plans」, 「the Activation Plan for Collaboration in ODA」, the 「Country Partnership Strategies (CPSs) for Priority Partner Countries」, 「Covid-19 response Strategies」, the 「Humanitarian Assistance Strategy」, the 「Multilateral Cooperation Strategy」, and the 「Fragile States Strategy」.

Policy-Making Process for ODA

Coordination Mechanism of Korea’s ODA

Coordination Mechanism of Korea’s ODA

As outlined in the previous section, the coordination mechanism for ODA in Korea includes three levels, which are the overall policy-making and coordinating institution, supervising ministries and implementing agencies in accordance with the Framework Act.
   In Korea, the CIDC assumes the role of the coordinating organization with the highest authority to govern ODA. The committee is chaired by the Prime Minister and consists of the government ministers, heads of public organizations and civilian representatives involved in ODA. It deliberates and decides on important policy issues to ensure the comprehensive and systematic implementation of ODA policy. After its establishment under the Prime Minister in 2006, in line with the Presidential Decree, the committee’s legal status was upgraded into that of a formal, legally established committee upon implementation of the Framework Act in 2010. The CIDC is supported by the Working Committee for International Development Cooperation as well as the Expert Committee for Evaluation established under it. Serving as the CIDC secretariat in accord with the Framework Act, the Office for Government Policy Coordination (OPC) provides working-level assistance in developing ODA policies and evaluating and adjusting ODA programs to support the operations of the CIDC and its committees.
The Ministry of Economy and Finance (MOEF) and the Ministry of Foreign Affairs (MOFA) are the supervising ministries, in charge of the provisions of concessional loans and grants respectively. They prepare their respective Annual Implementation Plans and monitor their implementations. When it comes to multilateral cooperation, the MOEF engages in cooperation with multilateral development banks (MDBs), and the MOFA with the UN and other international organizations. The MOEF manages the EDCF through its ‘Fund Management Council (chaired by the MOEF Minister)’ and the authority to identify, develop, execute and evaluate the EDCF’s loan programs is entrusted to the Export-Import Bank of Korea (KEXIM). With a view to ensuring the efficiency of loan program execution, the EDCF has established the ‘Inter-Agency EDCF Committee’ to facilitate information sharing and promote collaboration among private and public sector partners and the grant and loan implementing agencies during the project identification and selection stages.
   As the ministry supervising grant provision meanwhile, the MOFA is in charge of the formulation, implementation and coordination of grant aid policies, and prepares the related basic plans and annual implementation plans accordingly. The MOFA supervises and manages KOICA, the agency for grant aid provision. In order to ensure the efficient delivery of grants it also operates the ‘Inter-Agency Grants Committee’ (chaired by the MOFA Second Vice-Minister), as well as sub-committees to identify and eliminate any duplications and overlaps in grant programs. The MOFA coordinates international emergency relief and humanitarian assistance activities, and plays a role as a channel for external cooperation with other donor agencies and international organizations (including the OECD and the UN).
   As of 2020, 41 implementing agencies are implementing 1,551 ODA projects. The organizations that carry out the actual ODA implementation functions are called the ‘implementing agencies', of which there are two main ones in Korea: KEXIM and KOICA. The MOEF entrusts KEXIM with the responsibility for operating and managing the EDCF. KOICA on the other hand, executes its grant aid programs under supervision of the Minister of Foreign Affairs. Local government ODA has been on a continuous rise, from KRW 2.7 billion in 2005 to KRW 9.85 billion in 2020. The Ministry of Foreign Affairs organizes ODA workshops to help local governments build their capacity. Local governments are also taking a more integrated approach to ODAs through cooperation with implementing agencies and national universities. As the ODA landscape of Korea is becoming increasingly diverse, with a substantial rise in ODA projects, the coordinating roles played by the CIDC as well as the various supervising ministries are becoming more and more important.

Economic Development Cooperation Fund (EDCF)


Established in 1987 by the Korean government, as a policy finance institution to support industrialization and economic development in Korea's ODA partner countries, as well as promoting economic exchanges between Korea and partner countries, the EDCF has provided concessional loans characterized by long-term repayment periods (up to 40 years of maturity) together with substantially low interest rates (0.01-0.25%). As the general management authority over the EDCF, the MOEF determines the policies of the EDCF’s loan programs. Concerning the actual operation and management of these programs, the MOEF has delegated this authority to KEXIM, which thus manages the related funds on behalf of the Korean government.
   The EDCF provides targeted assistance to projects designed to establish economic and social infrastructures in order to promote development of the transportation, water, energy, health and telecommunication sectors. To meet the surging needs for large-scale infrastructure development in its partner countries, the EDCF provides packaged development and export financing programs, and participates in collaborative loan programs with the MDBs in order to secure additional financing. By keeping up with the changing development cooperation landscape, the EDCF continues to support sustainable development in Korea's ODA partner countries while promoting economic exchanges between Korea and them.
From the time of its establishment in 1987 through year-end 2019, the EDCF had approved a total of KRW 20.47 trillion for 446 projects in 57 countries. Of these approved loans, a cumulative total of KRW 9.21 trillion had been spent. Since passing the KRW 1 trillion mark in terms of the amount of loans approved for the first time in 2009, the EDCF approved its new loan which amounted to KRW 2.93 trillion. The Korean government is in this way keeping its commitment to international society to continually expand its ODA support. As of the end of 2019, 64% of these loans had gone to Asian countries, which are of higher economic and diplomatic significance to Korea. In line with its policy directions the EDCF is meanwhile diversifying its loan portfolio by extending loans also to Africa (25%) and to Latin America (8%).

Korea International Cooperation Agency (KOICA)


To ensure the efficiency and effectiveness of the grant aid programs that used to be carried out by multiple government ministries, the Korean government in April 1991 established KOICA under the MOFA as a unified grant provider. By sharing Korea’s development experience and expertise with partner countries, KOICA aims to help developing countries reduce global 0poverty, raise the quality of life, and achieve sustainable development and humanitarianism, 2. Korea International Cooperation Agency (KOICA) KOICA 2020 ODA -eng-20210412.indd 79 2021-04-12 6:05:58 80 Chapter3 Korea’s ODA System 2020 KOREA ODA WHITEPAPER which in turn will help Korea strengthen ties with those countries. KOICA delivers various development cooperation programs, including country-specific cooperation programs, global programs, humanitarian assistance and overseas emergency relief, private cooperation projects, Global Diseases Eradication Fund programs, and support for cooperation programs, particularly in areas of education, public administration, technology, environment, energy, agriculture, forestry, and fisheries. Between 1991 and 2018, KOICA disbursed a total of about KRW 7.29 trillion in 177 countries.
   KOICA is now serving as a development cooperation platform by entering into partnerships with a wide array of stakeholders, including government ministries, public institutions, civil society, business and academia. It is forging global networks through launching joint projects with UN development agencies to strengthen Korea’s national standing on the global stage. KOICA is joining forces with the international community to contribute to the resolution of global challenges, including poverty, environment, population, epidemics and human rights. By developing and fostering individuals with global competitiveness and indirectly helping Korean businesses explore overseas markets, KOICA is devoting efforts to create harmonious and symbiotic relations with partner countries.