OECD Development Co‑operation Peer Reviews: France 2024

Annex B. Progress against OECD legal instruments under the responsibility of the DAC

Recommendations adopted by the Development Assistance Committee (DAC)

DAC Recommendation on the Terms and Conditions of Aid [OECD/LEGAL/5006]

France has not complied with the DAC Recommendation on Terms and Conditions of Aid for over ten years.

Table A ‎B.1. France's compliance in 2020 and 2021 with the 1978 Recommendation on the financial terms of aid

		2020	2021	2018-20b
ODA commitmentsa in USD millions		24 465	21 547
Grant element in ODA commitmentsa	Norm: 86 %	75.30	75.60
Volume test: ODA commitmentsa as a % of GNI	2020 norm: 2020 0.28%	0.92
	2021 norm: 2021 0.27%		0.72
Grant element of ODA commitmentsa for LDCs (two alternative norms)	Annually for all LDCs – norm: 90.00%	80.40	77.60
	three-year average for each LDC – norm: 86.00%			n

Note: (a) commitments excluding debt reorganisation; equities are treated as having a 100% grant element but are not treated as loans. (b) In this column: n = non-compliance. Please note that during its discussions in 2020, the DAC agreed on the need to update the Recommendation on Terms and Conditions of Aid to reflect the decisions taken by the DAC High Level Meeting in 2014, such as the revised ODA definition and new measure of concessionality. However, DAC members expressed different opinions on the substance of changes to be made beyond a technical update.

Source: OECD (2024[1]), Data Explorer, Creditor Reporting System (database), https://data-explorer.oecd.org/vis?lc=en&df[ds]=DcdDisseminateFinal&df[id]=DSD_CRS%40DF_CRS&df[ag]=OECD.DCD.FSD&df[vs]=1.0&av=true&lo=5&lom=LASTNPERIODS&dq=DAC..1000.100._T._T.D.Q._T..&to[TIME_PERIOD]=false.

France points to the proportion of loans in total French ODA (about 20.0% measured in grant equivalent) to explain this failure to comply with the Recommendation. The government reports that it expects the average grant element or average grant element rate of aid to LDCs to rise gradually thanks in particular to measures approved at the CICID meeting in July 2023. It should be noted that Korea, as an example, allocates 49.9% of its total ODA to loans and also complies with the 1978 Recommendation.

DAC Recommendation on Untying Official Development Assistance [OECD/LEGAL/5015]

French ODA is not fully compliant with DAC standards. In 2021-22, 92.8% of its ODA allocated to the countries and sectors covered by the Recommendation on Untying Official Development Assistance was untied against a target of 100.0%. Regarding its total bilateral ODA to all other countries, 79.0% was untied. Two instruments managed by the Direction générale du Trésor make up the bulk of tied ODA: Treasury concessional loans and the Private Sector Study and Aid Fund, or FASEP. The latter includes explicit criteria to maximise support for exports in favour of French companies. Tied loans amounted to USD 938 million, equivalent to 11.5% of all loans granted in 2022.

France is among the DAC members that adheres to the transparency provision of the Recommendation and reports on contracts ex ante and ex post. It also stands out for having had the tied loan instrument evaluated.

France's new approach to promoting the French private sector raises questions about its commitment under the Recommendation to ensure that ODA is untied, both de jure and de facto. For example, France is proposing to extend loans linked to LDCs, which runs counter to the Recommendation. In addition, the target set for AFD in terms of calls for tender that French companies respond to is likely to push appraisals towards French suppliers.

In 2021, almost 43% of contracts financed by AFD (representing 51% of the total value of contracts) were allocated to French companies (in volume and number) in countries covered by the recommendation, and around 50% in other countries. France is in line with the average for DAC countries.

DAC Recommendation on the Humanitarian-Development-Peace Nexus [OECD/LEGAL/5019]

France favours a holistic approach to crises grounded in better co-ordination and complementarity between development activities, responses to humanitarian needs and peace objectives – the aim of the Recommendation. This review is based on the responses France provided in 2023 to the questionnaire that was developed to monitor implementation of the Recommendation.

The Recommendation has enabled France to improve its approach to the humanitarian, development and peace (HDP) nexus, including by developing new policies and communicating HDP principles during training for ministries and AFD staff in contexts of crisis and fragility.

Co-ordination: France has made a particular effort to improve internal co-ordination by giving the ambassador greater responsibility for joint analysis and co-ordination of the actions of Team France. Cross-analyses by staff working in the fields of security, development and humanitarian assistance now make it possible to identify and, more importantly, to rank the main causes of fragility and the main factors of resilience.

Programming: Several specific aspects of the French approach to fragility comply with the principles of the HDP Recommendation. For example, the aim of the recommendation to share analyses is to achieve a finer level of detail so that the priorities for action and the resilience factors to be strengthened can be specified area by area. This is the purpose of the integrated territorial approach implemented by the Minka Peace and Resilience Fund projects described in Box 6. The Minka Peace and Resilience Fund also has a regional approach, following crisis basins (Lake Chad, central Sahel, Syrian basin) rather than countries, in order to better adapt to cross-border dynamics and adjust responses according to these areas.

Localising aid and supporting endogenous crisis and conflict prevention processes are fundamental principles of French aid in fragile contexts. The DAC recommendation has been integrated into France's "Prevention, Resilience and Sustainable Peace" strategy, which is what directs the Minka Peace and Resilience Fund.

Financing: The increase in funding for crisis response has been achieved through humanitarian and development channels, with an increase in funding for the Crisis and Support Centre (CDCS) and AFD's Minka Fund. There is still a question mark over the definition of the scope of the two tools, and prevention and stabilisation instruments remain modest compared with response tools.

DAC Recommendation on Ending Sexual Exploitation, Abuse and Harassment in Development Co-operation and Humanitarian Assistance [OECD/LEGAL/5020]

The AFD Group has adopted an ethics charter, and internal guidelines have been drawn up to prevent harassment. Reporting guidelines have been developed through a professional whistleblowing system within the Group. Staff in MEAE and MEFSIN shave several channels for reporting misconduct, including the www.allodiscrim.fr platform, a psychological support unit, managers, HR officials, staff representatives, harassment liaison officers, the mediator, the ethics adviser, etc. A "Zero Tolerance" unit was opened in MEAE in 2020.

Standards and procedures have also been incorporated into all of AFD's co-operation agreements and financing instruments (Environmental and Social Risk Management Policy for AFD-funded Operations, AFD - Agence Française de Développement) without clarifying the issues covered by the recommendation. In MEAE, subsidy agreements for small local projects supported by embassies and the CDCS stipulate the obligation to combat sexual exploitation, abuse and harassment and to implement effective prevention, monitoring and response mechanisms.

France has also set up social complaints mechanism, both generic and for AFD projects (Environmental and Social Complaints Mechanism - Activity Report 2022, AFD - Agence Française de Développement) and for the CDCS. In the latter case, the CDCS compliance department is responsible for following up allegations in collaboration with the legal department.

France is not very involved in organising training, awareness raising and communication. It is active on the international stage in promoting women's rights, but less so in international co-ordination to prevent and respond to sexual exploitation, abuse and harassment.

DAC Recommendation on Enabling Civil Society in Development Co-operation and Humanitarian Assistance [OECD/LEGAL/5021]

The new strategy developed by MEAE “Civil Society and Civic Engagement 2023-27” (MEAE, 2023[2]), in consultation with civil society in France and in partner countries, adheres to the key principles of the OECD recommendation.

Strengthening civic space is one of the priorities of this strategy, and its Pillar 1 focuses in particular on promoting an enabling environment for all components of civil society throughout the world and in France. Within the frame of the CNDSI, France facilitated a working group on "Creating an enabling environment for civil society" in 2021. The 20 recommendations of this working group are followed up by MEAE but had not been assessed at the time of the review. In practice, efforts to promote civic space have resulted in the creation of an Innovation Foundation for Democracy in Africa in 2021. Some of the funding provided by MEAE also contributes directly to the structuring of civil society in partner countries (Équipe France CSO Fund, multi-stakeholder concerted programmes, etc.). However, France does not make sufficient use of the opportunities for dialogue created by AFD funding to engage in discussions on this issue. In addition, French civil society organisations are concerned about changes in the legal environment for CSOs, in particular the Republican Commitment Contract and the application of measures to combat money laundering and the financing of terrorism (see Recommendation of the Council for Development Co-operation Actors on Managing the Risk of Corruption). While MEAE and AFD are addressing this issue internally, engaging in substantive discussions with relevant ministries would strengthen policy coherence and help ensure an enabling environment for civil society, including by addressing the unintended consequences of anti-money laundering and counter-terrorism financing standards, in line with Pillars 1.6 and 2.10.b of the Recommendation.

Involvement with civil society takes place at the strategic level within the context of the CNDSI in Paris, but also within local development councils and during ad hoc consultations. In addition, the president of Coordination SUD, a platform of French NGOs, is a member of AFD's board, and the president of a CSO collective is on the board of Expertise France. However, more extensive consultations at local level would help improve the understanding of local expectations and issues beyond government authorities and improve the co-operation response.

The 2021 Programming Act recognises the added value and expertise of CSOs on issues of poverty, hunger and inequality, respect for human rights, protection of the planet, and gender equality. In 2022, French funding channelled through CSOs represented EUR 819 million, i.e. 6% of France's bilateral ODA (compared with EUR 355 million in 2018), which represents a steady increase over the review period but remains below the target set by France (15%, revised to 11% in the latest strategic guidelines). In addition, AFD's administrative procedures and co-financing rates are a deterrent for some CSOs.

The Act also recognises the right of initiative of organisations and France has a dedicated financing tool within AFD, the "CSO initiative" mechanism. In 2022, according to Coordination SUD, 50.3% of funding channelled through CSOs effectively contributed to their right of initiative.

French CSOs remain the main beneficiaries of funding for CSOs, but the share of local CSOs is increasing (2.1% in 2018, 9.9% in 2022). This is partly due to the opening up of the "CSO initiative" to local organisations from 2022, the creation of a Support Fund for Feminist Organisations (FSOF) in 2019 to support local feminist CSOs and the increase in Team France Funds managed by MEAE and more accessible to local organisations. With AFD developing a new CSO strategy, planned for 2024, it will be useful for AFD to address the issues of streamlining administrative procedures and strengthening local organisations.

Recommendations adopted by the OECD Council

Recommendation on Policy Coherence for Sustainable Development [OECD/LEGAL/0381]

In the 2021 Programming Act, France renewed its commitment to coherent policies for development (CPD), both explicitly in the Global Partnership Framework annex and implicitly in the Act itself, by requiring the government to report on CPD to the French parliament (French Republic, 2021[3]).

The government has not set itself any specific CPD priorities. In its 2017-22 voluntary national review (Government of France, 2023[4]), France acknowledges the trade-related impacts on developing countries, also confirmed in the Sustainable Development Spillover Index (Sachs et al., 2023[5]). The Commitment to Development Index identifies arms exports, migration policies and subsidies for agriculture and fossil fuels as areas for improvement (Center for Global Development, 2023[6]), with the latter accounting for EUR 13 billion in 2021 (Bon-Mardion et al., 2023[7]), an amount equivalent to French ODA in 2021.

Under the France Nation Verte initiative (Government of France, 2024[8]), France has taken important steps towards integrating the green transition into policy processes, notably through ecological planning and the green budget. The effects on developing countries (e.g. their role in the circular economy) do not feature specifically in this approach. At the international level, France is actively lobbying to create or strengthen multilateral frameworks, such as its collaboration with Costa Rica to contribute to the Kunming-Montreal Global Biodiversity Framework.

French co-operation co-ordination bodies, which bring together various different ministries, could also be used to discuss the cross-border impacts of French policies, but this opportunity is not taken. On the other hand, stakeholder consultation mechanisms, primarily the CNDSI and the Conseil économique social et environnemental (CESE), also bring together co-operation experts and representatives of developing countries. In their analyses, these two bodies look at the links between national policies and development objectives. France invests in education for citizenship and international solidarity and the MEAE and AFD had their efforts assessed in 2021 (MEAE, 2021[9]).

Bills and directives do not require an analysis of cross-border impacts. AFD has published an analysis of the impact of the introduction of the Carbon Border Adjustment Mechanism (CBAM) on EU trade partners (Magacho, Godin and Espagne, 2022[10]). National monitoring of SDGs includes some important indicators for monitoring cross-border effects. The report provided for in the 2021 Programming Act has not yet been submitted to the French parliament. It could be an important tool for analysing changes in key areas and informing political debate. Assessments of co-operation and reports by the Cour des comptes regularly focus on subjects of importance to CPD (e.g. trade, migration), but the connections are rarely explored.

Recommendation for Development Co-operation Actors on Managing the Risk of Corruption [OECD/LEGAL/0431]

France has adopted a specific strategy to define its co-operation in the fight against corruption (Government of France, 2021[11]). This strategy covers both co-operation systems and support for partner countries. It was developed by all public actors with expertise in the field, and collaboration and regular exchanges between these actors continue as the strategy is implemented. To improve its systems, France has increased training and awareness raising for staff, particularly those posted abroad.

In 2021, the OECD Working Group on Bribery acknowledged the efforts made by AFD to fight corruption,1 notably through the creation of an investigation function linked to an internal reporting system, the adoption of a policy to prevent prohibited practices and the introduction of a code of conduct (OECD, 2024[12]). The Working Group also made recommendations for improvement, and in 2024, noted significant progress (OECD, 2024[12]). AFD has strengthened the capacities of the investigations function to better follow up on reports, adopted a revised version of its procurement guidelines, and better targeted training for its staff based on their exposure to the risk of bribery and their role in implementing the prevention and detection mechanism. AFD has also partially implemented a recommendation on criteria to ensure the exclusion from procurement processes of entities that have been implicated in bribery cases.

The government does not publish data on alleged bribery incidents and their follow-up. Like Switzerland, France created a mechanism in 2022 to return ill-gotten assets for development purposes, but there are no examples of its application yet.

Support for anti-corruption bodies remains very limited, with less than EUR 300 000 per year on average over the period 2019-22. AFD's country strategies do not contain any corruption analysis. It is therefore unclear how co-operation actors will implement the area of the French strategy aimed at supporting partner countries.

France could also build the corruption detection capacity of its implementing partners. It will be important to continue discussions on this topic with implementing partners and especially civil society organisations, particularly in terms of the proportionality of checks relating to risks and opportunities for capacity building. These discussions could also build on the work of the Financial Action Task Force (FATF), which recently reviewed Recommendation 8 on non-profit organisations.2

Recommendation on Environmental Assessment of Development Assistance Projects and Programmes [OECD/LEGAL/0458]

France adheres to the Recommendation of the Council and has a comprehensive environmental assessment process for development aid activities that is constantly evolving and improving.

AFD has drawn up a list of activities that it refuses a priori to finance. This list applies environmental, social, ethical and regulatory criteria as well as criteria resulting from strategic choices. It was revised in 2022 to strengthen the biodiversity and human rights aspects. The list also includes additional criteria for certain high-risk sectors.

AFD integrates social responsibility into its governance system and activities. Its environmental and social risk management policy makes it possible to assess, control and mitigate potential environmental and social risks and damage as well as human rights violations that may result from its activities. This approach applies to all stages of the project cycle and is complemented by two mechanisms for AFD and Proparco for handling, respectively, environmental and social complaints.

Finally, at the appraisal stage, AFD uses a sustainable development opinion tool, which enables programmes to be rated independently on several levels (environmental, social, economic, governance) in order to assess their expected ex-ante impacts. If a programme is likely to be detrimental to one of these dimensions, it is submitted to the Board of Directors for review in order to avoid potentially negative impacts. This tool will soon be enhanced with the possibility of also assessing ex-post impacts and reinforcement of the governance dimension, which is welcome.

OECD DAC Declarations

OECD DAC Declaration on a new approach to align development co-operation with the goals of the Paris Agreement on Climate Change [OECD/LEGAL/0466]

France is increasingly aligning its development co-operation with the goals of the Paris Agreement, and the strategic orientations of the CICID and CPD make this a priority policy objective for the coming years. Accordingly, France no longer supports projects that run counter to the two major objectives of the Paris Agreement (reducing greenhouse gas emissions and adapting to climate impacts). AFD analyses the coherence of each operation in terms of its low-carbon trajectory and resilience to climate change, looks for climate co-benefits, and has improved and strengthened its sustainable development opinion tool and its exclusion list to avoid financing this type of project. The only exceptions are in accordance with the DAC Declaration: in cases where no other clean energy source is economically or technically feasible; where such projects are part of a host country's transition plan; or in well-defined situations such as humanitarian crises or emergency situations where access to the electricity grid is not possible and a case can be made for support in the form of ODA for fossil fuel power generation.

In addition, the increase in French ODA has gone hand in hand with a sharp rise in climate financing in line with the need for all French aid to be aligned with the Sustainable Development Goals. In 2022, France provided EUR 7.6 billion in climate financing, exceeding its own targets and its "fair contribution" to global climate financing.

However, France still needs to ensure that there is a better balance between mitigation and adaptation funding and that more of this funding is targeted at LDCs, particularly in Africa, as well as other vulnerable partner countries (such as fragile contexts and small island developing states). The work aimed at promoting a fair transition and putting in place a tool to take into account the multidimensionality of vulnerability will be useful for better integrating social aspects into climate financing and thereby contribute to this rebalancing.

In terms of biodiversity, France has set itself the target of allocating EUR 1 billion to biodiversity by 2025, in particular by maximising convergence and co-benefits between climate finance and biodiversity finance. These objectives were already achieved in 2022 when France provided USD 2.3 billion in financing for biodiversity, with 43% of climate co-benefits. That said, the biodiversity portfolio is being increasingly subsumed by the climate portfolio, as almost all ODA for biodiversity now has a climate link compared with only half in 2018. This testifies to the climate focus of this aid, which will have to be increased and remain focused on the objectives of the Global Biodiversity Framework.

References

[7] Bon-Mardion, J. et al. (2023), Study on Energy Subsidies and Other Government Interventions in the European Union: Final Report 2023 Edition, Directorate-General for Energy, European Commission, Grenoble, https://data.europa.eu/doi/10.2833/571674.

[6] Center for Global Development (2023), Commitment to Development Index 2023, https://www.cgdev.org/cdi#/.

[3] French Republic (2021), LOI n° 2021-1031 du 4 août 2021 de programmation relative au développement solidaire et à la lutte contre les inégalités mondiales, https://www.legifrance.gouv.fr/dossierlegislatif/JORFDOLE000042676989/.

[8] Government of France (2024), France Nation Verte: La planification écologique, https://www.gouvernement.fr/france-nation-verte (accessed on 27 January 2024).

[4] Government of France (2023), Transformer la société par l’Agenda 2030: Revue nationale volontaire de la France 2017-2022, https://www.agenda-2030.fr/agenda-2030/dispositif-de-suivi/revue-nationale-volontaire-de-la-france-2017-2022/?.

[11] Government of France (2021), Stratégie anticorruption de la France dans son action de coopération 2021-2030, https://www.afd.fr/fr/ressources/strategie-anticorruption-france-dans-son-action-de-cooperation-2021-2030.

[10] Magacho, G., A. Godin and E. Espagne (2022), Impacts Of CBAM on EU Trade Partners: Consequences For Developing Countries, AFD, Paris, https://www.afd.fr/en/ressources/impacts-cbam-eu-trade-partners-consequences-developing-countries.

[2] MEAE (2023), Société civile et engagement citoyen 2023-2027, Ministry for Europe and Foreign Affairs (MEAE), Paris, https://www.diplomatie.gouv.fr/IMG/pdf/document_d_orientation_strategique_societe_civile_et_engagement_citoyen_2023-2027_cle45e5e6.pdf.

[9] MEAE (2021), Évaluation du soutien du ministère de l’Europe et des Affaires étrangères et de l’Agence française de développement aux acteurs de l’éducation à la citoyenneté et à la solidarité internationale (ECSI), Ministry for Europe and Foreign Affairs (MEAE), Paris, https://www.diplomatie.gouv.fr/fr/photos-videos-publications-infographies/publications/enjeux-planetaires-cooperation-internationale/evaluations/evaluations-2023/article/evaluation-du-soutien-du-meae-et-de-l-afd-aux-acteurs-de-l-education-a-la.

[1] OECD (2024), Data Explorer, Creditor Reporting System (CRS) (database), https://data-explorer.oecd.org/vis?lc=en&df[ds]=DcdDisseminateFinal&df[id]=DSD_CRS%40DF_CRS&df[ag]=OECD.DCD.FSD&df[vs]=1.0&av=true&lo=5&lom=LASTNPERIODS&dq=DAC..1000.100._T._T.D.Q._T..&to[TIME_PERIOD]=false.

[12] OECD (2024), Implementing the OECD Anti-Bribery Convention: Phase 4 Two-Year Follow-Up Report - France, OECD Publishing, Paris, https://www.oecd.org/corruption/France-phase-4-follow-up-report.pdf.

[5] Sachs, J. et al. (2023), Sustainable Development Report 2023: Implementing the SDG Stimulus, Sustainable Development Solutions Network, New York, https://sdgtransformationcenter.org/reports/sustainable-development-report-2023.

Notes

← 1.  For more information, see https://www.afd.fr/en/combating-corruption.

← 2.  It should be noted that tensions can exist between the implementation of measures to combat money laundering and the financing of terrorism and the financing of partners, in particular between the requirement to verify all final receipts and humanitarian principles. Following legal action brought by civil society organisations, the Conseil d’État overturned the relevant guidelines in 2023 (https://www.legifrance.gouv.fr/ceta/id/CETATEXT000047121728). It will be important to ensure that the efforts invested are proportionate to the risks identified, in line with the 2016 Recommendation and the 2022 recommendations of the FATF mutual evaluation: https://www.fatf-gafi.org/en/publications/Mutualevaluations/Mutualevaluationoffrance.html.