Global Governance and the Informal Nature of Islamic Development Assistance: The Peculiar Case of Gulf States

This chapter scrutinizes the fragmentation of the OIC aid system. It is argued that this fragmentation is a result of the asymmetrical intergovernmental relationship between a small number of aid donors (notably the hydrocarbon-rich Gulf States) and a large and increasing pool of aid recipients. The chapter illustrates that this process is empowered by the asymmetrical setting of the OIC (there are very few donors with whom to compete), donors have “bilateralized” the multilateral by supporting their own “aid recipients”. This has progressively fragmented the OIC aid system. In parallel, because borrowers and aid recipients dominate the OIC arena numerically, their increasing demands have enhanced donor organization proliferation, to the detriment of a cohesive OIC aid system. The combination of these two trends explains why the OIC system is fragmented, structurally underfunded, and difficult to reform. These consequences constitute a challenge that the OIC must address going forward.