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__NOTOC__<small-title />Transfers refer to funds from international donors and charitable foundations (, including non-governmental organisations, decentralized cooperation or local civil society organizations) that and typically come from other countries (GLAASWHO and UN-Water, 2012). These funds can be contributed in the form of grants, concessionary loans (i.e. loans that include a “grant” element in the form of a subsidized interest rate or a grace period) or guarantees.
For an overview of transfers available for water, sanitation and hygiene (WASH) projects or businesses in developing countries see [[Transfers include any contributions from - Available Funds]]. '''Transfers can be made in the form of a:'''* [https://en.wikipedia.org/wiki/Grant_%28money%29 Grant], non-repayable funds disbursed by one party (foreigngrant makers) donors , often a government department, corporation, foundation or trust, to a recipient. In order to receive a grant, some form of "Grant Writing" often referred to as either a proposal or an application is usually required. Most grants are made to fund a specific project and require some level of compliance and reporting. * [http://en.wikipedia.org/wiki/Loan Loan], the borrower initially receives or borrows an amount of money from the lender, and is obligated to pay back or repay an equal amount of money to the lender at a later time. Some sources do not include loans as part of transfers as the borrower is obligated to pay back or repay an amount of money to the lender at a later time (Hervé-BazinEUREAU, 2012) . :Most commonly used loans in the water and sanitation sector are::* [http://en.wikipedia.org/wiki/Concessionary_loan Concessionary loan], is a loan bearing no interest or a rate of interest that is below the average cost. :* [http://en.wikipedia.org/wiki/Microcredit Microcredit], is a very small loan extended by a bank or other financial organisations that provide services to poor households (Saywell and Fonseca, 2006).:*[http://en.wikipedia.org/wiki/Surety Guarantee], a promise by one party to assume responsibility for the debt obligation of a borrower if that borrower defaults. The person or company that provides this promise, is also known as a surety or guarantor. ===Transfer mechanisms=== These transfers can consist ofbe made by: * Subsidies Oversees Development Assistance (technical support and budget support)* Carbon credits* Direct transfers ====Oversees Development Assistance (ODA)====Transfers include official development assistance (ODA). Official development assistance could be considered as an international tax transfer since it is paid for example by tax payers from other countries. Aid policies (*) suggest more aid be delivered in the form of budget support, which implies that they would be disbursed in much the same way as national public budget resources (OECD, 2009). [http://en.wikipedia.org/wiki/Official_development_assistance Official development assistance] is usually seen as part of transfers, as donors are still disbursing most of their aid through projects and programmes rather than through recipient country budget processes. Another important feature that distinguishes official development assistance from taxes is that they are levied in foreign countries, rather than nationally and the European Unionpolitical and administrative process of securing ODA resources is very different from taxes (OECD, 2009). * In many developing countries, transfers remain a major source of financing for sanitation and drinking-water, mostly for [[Capital_Expenditure_(CapEx)|capital expenditure]] (WHO and UN-Water, 2012). Over US$ 8.9 billion in [http://en.wikipedia.org/wiki/Official_development_assistance official development assistance (ODA)] (part of transfers) was directed to sanitation and drinking-water in 2009 (WHO and UN-Water, 2012). [http://en.wikipedia.org/wiki/Official_development_assistance Official development assistance ] for sanitation and drinking-water accounts for more than 1% of Gross Domestic Product (ODAGDP) in seven developing countries (see table 1). (* Philanthropic donations) Defined in the Paris Declaration (2005), the Accra Plan of Action (2008) and the Busan Partnership Agreement (2012).
'''Table 1. Top WASH recipients by official development assistance (ODA) % of Gross Domestic Product (GDP)'''
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Source: GLAASWHO and UN-Water, 2012, page 27
[http://en.wikipedia.org/wiki/Official_development_assistance Official development assistance (ODA) ] for drinking-water and sanitation has risen slowly as a percentage of total development aid since the low point of 2002, but is still significantly below aid for social sectors, such as health and education (see figure 1).
'''Figure 1. Trends in official development assistance (ODA) for water and sanitation,<br> education, and health/population/HIV/AIDS, as a percentage of total ODA commitments, 1995–2010'''
[[Image:Transfers fg 1.jpg|thumb|none|600px|Source: OECD, 2012/ GLAASWHO and UN-Water, 2012, page 51]] '''Budget support'''<br>Transfers can be made in the form of budget support where funds are transferred directly to the recipient government, thereby enabling the government to manage the aid as part of its own resources and help finance the implementation of their policies (Verhoeven, Uytewaal, E. and de la Harpe, 2011). With budget support, the funds are channelled through the systems used for a government's own funded expenditures. This happens through the government's finance ministry (or "treasury") via regular government procedures, to the ministries, departments or agencies responsible for budget execution (Williamson and Dom, 2010). <br>The main types of budget support are (Verhoeven, Uytewaal, E. and de la Harpe., 2011): * General budget support (GBS); funds that are not earmarked for a specific sector of government spending* Sector budget support (SBS); funds are allocated for use in a specific sector or budget line, e.g. water and sanitation. Sector budget support from donors for WASH was only 3% of total WASH aid in 2010 (WHO and UN-Water, 2012). Donors can also use transfers to give Technical Assistance (TA) in the form of (OECD, 2010):* Grants to nationals of aid recipient countries, receiving education or training at home or abroad.* Payments to consultants, advisers and similar personnel as well as teachers and administrators serving in recipient countries (including the cost of associated equipment). ====Carbon credits====Carbon credits are a new potential source of transfers that are already being used on a small scale for wastewater treatment projects (E-Source, 2009) and household water treatment initiatives (Water Institute, 2012).
Recovering methane from wastewater treatment plants to generate power not only saves energy costs, it also helps to reduce greenhouse gas emissions, which offers operators in developing countries an opportunity to sell carbon credits under the Kyoto Protocol's Clean Development Mechanism (CDM) (E-Source, 2009). The sale of these credits could be used to finance treatment plants.
* Water Institute, 2012. Carbon credits and HWTS: a viable "green" funding mechanism? Webinar, 17 July 2012. Chapel Hill, NC, USA, The Water Institute, Gillings School of Global Public Health, University of North Carolina at Chapel Hill
* Winpenny, J., 2011. [http://www.gwptoolbox.org/images/stories/Docs/euwi%20fwg%20primer%20on%20financing%202011.pdf Financing for water and sanitation: a primer for practitioners and students in developing countries]. Stockholm, Sweden: The European Union Water Initiative Finance Working Group, EUWI-FWG.
===Links===* [http://www.ircwash.org/ IRC International Water and Sanitation Centre ] is a knowledge broker, innovator and catalyst of change within the water, sanitation and hygiene (WASH) sector working internationally and in selected focus countries and regions. IRC seeks to extend WASH services to the less privileged, while ensuring that services are based on the sustainable use of water resources, are appropriately managed, and are better governed. IRC works in partnership with governments, the public and private sector, Dutch and international organisations, UN institutions, development banks and non-governmental networks and organisations. For more information see: [http://www.irc.nl irc.nl]
* [http://www.who.int/water_sanitation_health/publications/glaas_report_2012/en/index.html Global Analysis and Assessment of Sanitation and Drinking-Water (GLAAS) ] is produced every two years by the World Health Organization (WHO) on behalf of UN-Water. It provides a global update on the policy frameworks, institutional arrangements, human resource base, and international and national finance streams in support of sanitation and drinking-water. For more information see: [http://www.who.int/water_sanitation_health/publications/glaas_report_2012/en/index.html Global analysis and assessment of sanitation and drinking-water (GLAAS)]