In 2005, more than 100 governments and aid organisations signed the Paris Declaration on Aid Effectiveness, committing to channel assistance through national systems rather than build parallel ones. This commitment was reinforced in subsequent high level forums in Accra and Busan.
Two decades later, progress remains limited.
Across health, education and infrastructure programmes in low and middle income countries, development partners continue to operate separate procurement channels, independent financial systems and stand alone reporting mechanisms. These choices are often justified by fiduciary caution or tight delivery timelines, but the effect is consistent. They weaken the institutions donors seek to strengthen.
Parallel systems do not run alongside national institutions. They hollow them out. When multilateral banks, bilateral donors and United Nations agencies establish their own procurement and financial management arrangements, they divert more than funding. Skilled staff move towards donor funded units where pay is higher and resources more reliable. A Center for Global Development study of over 900 African civil servants found this pattern is widespread across technical assistance programmes. Over time, capability within government systems declines.
This pattern is reflected in practice. In several externally financed programmes, particularly in infrastructure and health, implementation has relied on dedicated project units operating alongside core government structures. These arrangements can support delivery in the short term, but they also draw experienced staff away from systems expected to sustain services once projects close.
The result is a self reinforcing cycle. Donor systems appear to perform better because they attract stronger staff and more predictable resources. National systems appear weaker because they are consistently depleted. This dynamic then reinforces continued reliance on parallel arrangements.
The impact extends beyond capacity. Transparency is also affected. When procurement and spending take place outside government systems, information does not consistently enter national records. Even where financial management and procurement platforms are in place, a share of externally financed spending remains off budget or only partially captured. Legislatures, oversight bodies and citizens are left without a complete view of how resources are used. Systems designed to strengthen oversight can reduce accountability at the national level.
These gaps become more pronounced where service delivery depends on coordination across levels of government. In devolved systems, responsibility for sectors such as health and water is shared. Separate implementing partners and reporting systems make it difficult for national and subnational authorities to track what is being delivered and where. Gaps emerge not from lack of funding, but from weak coordination.
Similar challenges have been observed in crisis response. During the COVID 19 pandemic, the global vaccine initiative COVAX, led by the World Health Organization, Gavi and the Coalition for Epidemic Preparedness Innovations, aimed to pool procurement and ensure equitable access. In practice, it operated largely outside national systems. By September 2021, it was expected to cover about 17 percent of the population across Africa, well below the 40 percent target. At the same time, countries faced difficulties integrating vaccine flows into national budgets and distribution systems, including cold chain capacity and last mile delivery. As countries moved towards financing their own immunisation programmes, parallel arrangements for procurement and reporting had to be absorbed into government systems, exposing gaps in budget predictability and supply management.
Moving away from parallel systems is not about ignoring risk. It is about managing risk more directly and more transparently. This requires three shifts.
First, governments need to strengthen the foundations which make system use credible. Transparent procurement rules, functional financial reporting and reliable budget execution are central. Rwanda provides a clear example. Its national electronic procurement system is increasingly used by development partners, including the World Bank Tanzania has also strengthened its systems, allowing greater use of national processes in externally financed projects.
Second, development partners need to recognise strengthening national systems as a development outcome in its own right, not a condition to be met before programmes begin. This requires greater use of government budgets, alignment of reporting with national budget cycles and direct support for system reforms within programmes. In several countries, efforts to align external support within sector frameworks, particularly in health, have have helped improve coordination, although many projects still operate outside these systems.
Third, the sector needs more consistent and transparent measures of progress. Current aid effectiveness monitoring, including the Global Partnership for Effective Development Co operation’s progress reports, shows limited improvement in the share of aid using national procurement and financial systems, with levels remaining below the ambitions set in the Paris Declaration. System use is also tracked as part of broader datasets such as the Global Public Procurement Database. Publishing this information more prominently, and linking it to donor performance frameworks, would help strengthen accountability.
The choice to use or bypass national systems is a choice about which institutions are strengthened. Working through national systems requires time and discipline, but it offers a credible path to lasting results.
Experience across countries reflects this clearly. Where development partners use national systems, including integrated financial management platforms and procurement portals, coordination and visibility tend to improve. Where parallel arrangements persist, particularly in large externally financed projects, gaps remain in oversight, continuity and long term capacity.
Strengthening country systems is a long term investment in how public resources are managed and how services are delivered. It is more demanding, but it is also the most reliable way to build institutions capable of sustaining progress over time.
Written by Carey Kluttz – Partnerships Director, Expertise Global
