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A counterpart fund is a technique for turning foreign aid into reserves of domestic currency. They were used by the UNRRA, and the Marshall Plan in the rebuilding of Western Europe after the Second World War,[1] and today remain a common technique for delivering developmental assistance.

One method of setting up a counterpart fund is to have businesses in the country receiving aid that want to import a commodity place an order with their government and pays for the import in their local currency. The government then uses some of their foreign assistance, still in the foreign currency, to pay for the goods. This makes importing far easier as the unstable currencies in developing nations are often of little international value. Agreements are also usually signed so that these imports can only come from the nation that gave the aid, benefiting the donor's export industry. Another method is for goods to be donated to a developing nation's government and for them to then sell the goods to the population, and use the proceeds to set up a fund.

The recipient government is also then left with the original payment in its domestic currency. These payments are amalgamated into a fund that is used to further fund development. This can take the form of investments in infrastructure or industry, paying down the debt or deficit, or stabilizing the currency. The investment of these funds can take the form of loans rather than grants, creating a permanent pool of investment capital. For instance, Germany's Marshall Plan counterpart funds were used to set up such an investment fund, and it is still in operation today.

References[edit]

  1. ^ Greg Behrman, The Marshal Plan, Aurum Press Ltd., 2008, pp. 178,179,232.

Original courtesy of Wikipedia: http://en.wikipedia.org/wiki/Counterpart_fund — Please support Wikipedia.
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1157 news items

 
AllAfrica.com
Thu, 04 Feb 2016 06:26:15 -0800

While there is a noticeable increase in the proposed counterpart funding for HIV /AIDS including the Global Fund, there was no provision for a counterpart Fund for the Polio Eradication Programme & Routine Immunization and other vaccines which have ...

Naija247news

Naija247news
Thu, 04 Feb 2016 05:30:51 -0800

Nzuki, represented by Mr Saaondo Anom, a Wash Specialist in UNICEF, commended Obiano for his sensitivity to the needs of the people by paying the counterpart fund at the appropriate time. “Anambra is the only state in the whole of South-East and ...
 
AllAfrica.com
Wed, 03 Feb 2016 01:00:00 -0800

While briefing the commissioner on the collaboration between UNICEF and the ministry in the area of provision of water in the rural areas, he commended the State Government far releasing it's counterpart fund of N111.9 million to support the ...

Naija247news

Naija247news
Sun, 31 Jan 2016 01:00:00 -0800

He further said that the state was in the process of paying its counterpart fund in order to access additional financing for Fadama 111 project in the state. Izevbigie also said that the office was currently disbursing funds for ongoing Fadama ...
 
AllAfrica.com
Thu, 28 Jan 2016 19:11:15 -0800

Enugu — Enugu State Executive Council has approved the release of N184,476,135.98, for various developmental projects in the state. Commissioner for Information, Godwin Udeuhele, made this known during a briefing at the end of the council meeting ...

CHANNELS TELEVISION

CHANNELS TELEVISION
Mon, 25 Jan 2016 01:11:15 -0800

Anambra-State-Governor-Willie-Obiano Anambra State Governor, Willie Obiano, has directed the full implementation of the FADAMA 3AM Project, with immediate payment of 112 million Naira counterpart fund for 2015 and 2016. The project is in line with the ...

NAIJ.COM

NAIJ.COM
Thu, 28 Jan 2016 14:12:31 -0800

A group, Libya Returnees Association, has accused the Edo state commissioner for commerce and industry, Abdul Orho, of conniving with about 360 others to divert the N1 billion counterpart fund World Bank loan approved for its members by the state ...

The Guardian Nigeria

AllAfrica.com
Sat, 16 Jan 2016 12:03:45 -0800

Gov. Simon Lalong of Plateau has pledged more support for the Fadama III Additional Financing (AF) programme, aimed at reducing poverty level and increased food production in the state. The governor made the pledge when he received Dr Adetunji ...
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