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An institution's performance is closely linked to the ways in which a donor attempts to build capacity as well as the environment in which it functions. Much has been made of the importance of a stable environment and in the last decade aid agencies have increasingly moved toward the influencing of sector policy as a critical means of technical co-operation. However, at the project level the relationship between donor and recipient is fundamental to the success of any intervention. In this article a best practice model is developed. Case studies of institutional development projects in South East Nigeria provide examples with which to evaluate the model. © 1998 John Wiley & Sons, Ltd.
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