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There is ongoing debate about the effectiveness of aid in addressing poverty and underdevelopment. Part of the reasons for the ineffectiveness is the defective delivery mechanism driven by disparate donor preferences, donor assistance strategies poorly aligned with country development strategies, wasteful and duplicative competition among externally-funded programs, and divergent and burdensome donor procedures, and requirements that unnecessarily increase the transaction costs of delivering aid. In response to this ineffective mechanism, the comprehensive development framework (CDF) principles emphasize a new aid relationship based on country-led partnership, ownership, participation, donor coordination, and harmonization. The implementation of these principles are expected to lead to greater efficiency in donor assistance, raise institutional quality in the recipient countries, and increase the impact on the attainment of the millennium development goals (MDGs). This paper focuses on the relevance, efficacy, and efficiency of the implementation of the country-led partnership principle both on the ground and at the policy level among donor and partner countries. Specifically, the study ascertains the extent to which the country-led partnership principle has been practiced; evaluates the factors that have facilitated or hindered its implementation; analyzes whether its implementation has been oriented to pursuing the overarching MDGs; and identifies a set of hypotheses and cross-country indicators regarding the 'functionality' and the development impact of the partnership principle. The study was carried out in two phases. The first phase focused on donors and development agencies and assessed the extent to which donors' behavior has changed to enable the implementation of the partnership principle. The second phase concentrated on country-specific aspects of the CDF, drawing on the country experience. The report is organized as follows: section one gives introduction. Section two sets the stage by clarifying some theoretical basis for partnership and outlines the expected characteristics of the country-led partnership under the CDF. Section three looks more specifically into development partnerships. Section four discusses the conceptual framework for implementation of country-led partnership. Section five reports on the survey results and general findings from the literature regarding donor and recipient country behavior. Section six evaluates the conceptual and methodological issues in the construction and application of indicators of partnership performance. Section seven provides conclusions.
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