Many donors not reporting to the OECD Development Assistance Committee (“non-DAC”) lack either the capacity or the political will to publish detailed information about their development cooperation activities. In order to provide a more comprehensive picture of these development finance activities, a small team of AidData researchers recently began developing, testing, refining, and documenting a set of data collection procedures that extract and codify project-level information from news reports. This summer, we helped pilot this methodology by testing its usefulness in tracking Saudi Arabian aid flows to Yemen, which are not published through official channels.
In recent years, the Kingdom has poured billions of dollars into its smaller, weaker, southern neighbor; analysts estimate that Saudi aid to Yemen ranges between $1-2 billion a year. (See recent reporting from Reuters and the Financial Times here and here.) However, details about the nature of these financial transfers are few and far between. Using media-based methods, we attempted to generate the most detailed, project-level summary of Saudi aid to Yemen to date.
Using Arabic and English news sources, we gathered detailed information on some 45 Saudi loans, grants, and credits to Yemen from 2006 to 2010 worth approximately $1.56 to $1.83 billion. These financial flows supported the following sectors: transportation (23-27%), economic development (9-18%), energy (14-16%), water and sanitation (13-15%), health (10-12%), emergency support (5-6%), and education (3-4%). Most of this funding to Yemen came in the form of grants (65%); the remainder consisted of loans (17%) and import/export credits (12%).
The data show that, during the period in question, Saudi Arabia provided far more than any single DAC country and nearly as much as the top three DAC donors combined. Additionally, the data suggest that Saudi Arabia favors fewer, larger, infrastructure projects—a significant departure from the trend among DAC countries to support smaller, but more numerous, projects in a variety of sectors.
Overall, we consider the pilot a success, but we did encounter several difficulties, which reinforce the fundamental point that media-based methods are no substitute for comprehensive official records:
- First, our use of ranges in estimating total Saudi commitments to Yemen reflects uncertainty about
whether some projects should be considered official development assistance (ODA).
- Second, our data collection efforts suggest that Yemen has received, on average, a little over $300
million a year from Saudi Arabia—a large sum, but still only a fraction of the estimated $1-2
billion that it reportedly receives each year.
- Third, media-based methods are not useful for documenting financial transfers that governments
are actively seeking to conceal. Sarah Phillips of the University of Sydney claims that "[i[n 2009,
the Kingdom made a direct payment of $US 2.2 billion to President Saleh." Citing unnamed
sources from the local donor community, she also reports that Saudi Arabia made a direct
contribution to Yemen's Central Bank in August 2010 worth somewhere between $1 billion and
2 billion.
All of these caveats notwithstanding, the results of the pilot provide a rare window into the world of Saudi development finance. They also point to the woeful inadequacy of existing aid information systems for tracking non-DAC sources of development finance.
Keep a close eye on The First Tranche in the coming months for more details about AidData's forthcoming media-based methodology. We plan to release a codebook and a dataset for a high profile supplier of non-DAC development finance later in the fall.
***Editor's Note***
It was brought to our attention that the chart above is difficult to read. Big kudos and thanks to Tariq (@tkb) for going out of his way to send us an updated, and even fancier, chart for the post.
Check out the full exchange here: https://twitter.com/tkb/status/261113893538103297
Which chart do you think is easier to read?
