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A former programme officer at the Norwegian Embassy in Tanzania considers challenges to aid effectiveness in a major natural resources programme. After twelve years of support by the Norwegian government totalling about US$ 60 million, an evaluation by independent consultants revealed in 2006 that up to half of the funds allocated may have been lost through corruption and mismanagement. Explanatory factors discussed include inadequate analysis of the sector’s political economy, future oriented strategies and plans from the donor side, over-reliance on the government’s financial management systems, report based evaluations by interested parties, and the “pipeline problem” common in development aid. The author concludes with ideas for avoiding these pitfalls through a more sophisticated approach to budget and programme support.

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