Finnish Value-Added: Boon or bane to aid effectiveness?

This study looks at the quest for ‘Finnish value-added’ (FVA) in development cooperation and assesses how FVA affects aid effectiveness. “Value added” in development is taken to be the attempt to bring into cooperation something extra beyond the monetary volume of aid.

The Ministry for Foreign Affairs of Finland commissioned an independent research team of academics from Finland, Tanzania, and Nepal, to investigate the origins of Finnish value-added. The team found that FVA has mostly been understood as something peculiarly ‘Finnish’ – be it technology, expertise, skills, attitudes, values, or patterns of behaviour. However, FVA can also be seen as something more general that has been learned and acquired during Finland’s years of cooperation, and which can now be deployed as part of wider donor constellation.

The study argues that there is no predetermined relationship between value-added and aid effectiveness. Efforts at value-added can enhance aid effectiveness, or undermine it; or there may be no connection. All depends on how development aid projects are carried out. The study concludes that, from the partner’s point of view, aid funds are important in themselves. The value of what a donor can provide in addition to funds cannot be unilaterally decided by the donor, but must be negotiated with the partner on the ground.

Finnish Value-Added: Boon or bane to aid effectiveness? (Opens New Window) (PDF, 1.15 MB)