Glossary of Development Terms and Abbreviations

NB: Some of these terms are specific to DFID, others are used throughout the development community.

LACAD Latin American Caribbean & Atlantic Department

Least Developed Country (LDC) - in the mid-1960s, 24 countries were identified as having particularly severe long-term constraints on development. They were assessed on 3 criteria: per capita gap, manufacturing base and literacy. Inclusion on the list of LLDCs is now assessed on 2 criteria: economic diversity and quality of life, there are now 48 countries on the list.

Lender - an organisation that lends money - usually, but not exclusively, a bank or financial institution.

Lessons Learned - project specific, of generally applicable guidance derived from the conclusions of an evaluation.

Letter of Credit - is a document issued by a Bank on behalf of a customer which guarantees payment by the bank of cheques drawn by the customer, or more commonly of bills drawn on that customer by parties from whom ha has bought goods. An added security in financing foreign trade.

London Inter Bank Offered Rate (LIBOR) - this offered rate is the funding cost to a bank, it is common to use the offered rate as a benchmark for the bank's lending rate.

Loan - a sum of money lent by one person or organisation to another, usually with interest. Loans differ from grants in that they have to be repaid. This requires that the recipient is creditworthy, can provide security against default and has a cash flow sufficient to make the interest and capital payments.

Loan Document - the documentation sent by the lender to the borrower setting out at length the terms and conditions on which an offer of funding is being made. This is the normal approach for any large contract.

Loan Guarantees - a legal obligation to compensate a lender if the borrower fails to repay a loan. This takes the risk out of lending and the borrower can receive credit on more favourable terms.

Loans Provided through Financial Intermediaries - these take advantage of the commercial banks' skills in financial management of loans. The bank is responsible for financial appraisal, while the Fund appraises technical, environmental and economic factors.

Local - Cost Aid - The contribution made by a donor to local costs of projects or technical assistance because of the inability of the recipient to make sufficient funds available.

Local Costs - Those costs of a development project which are made up on locally - procured goods and services.

Local Skills - skills available within the country that can be used to progress a project.

Logical Framework (LF) also known as Logical Framework Approach, Logical Framework Analysis, Log Frame Analysis and Project Framework.

LF is an aid to logical thinking and a means whereby a project may be structured and described for analytical purposes; a development of the management by objectives approach. It is a method which provides a structure for designing a project and a tool for project management and evaluation. It must be kept constantly under review.

The log frame specifies what the project is attempting to achieve and indicates the means by which the achievement may be measured. It makes the project logic explicit.

LF comprises three main steps:

• establishment of objectives.

• establishment of relationships between activities, outputs, purposes and goals - relates these through hypothesising a series of cause effect linkages in a hierarchical form.

• identification of objectively verifiable indicators and means to measure them systematic recording of assumptions made when designing project, i.e. the assumptions underpinning the cause-effect linkages.

LF uses a number of terms:

1. Goal - the reason for undertaking the project; the ultimate objective of the programme to which the specific project will contribute.

2. Purpose - what the project is expected to achieve in development terms once it is completed; the motivation behind the outputs.

3. Outputs - the specific results to be achieved by the management of activities.

4. Activities to be undertaken and the resources inputs available to produce the outputs.

5. Objectively verifiable indicators (OVI) - performance indicators which are relevant, independent and can be precisely and objectively defined in order to demonstrate that the objectives of the project have been achieved.

6. Means of verification (MOV) - the means to ensure that the OVI can be measured effectively, i.e. specification of the indicators, types of data, sources of information and collection techniques.

The structure of the log frame is a 4x4 matrix. The columns represent the levels of project objectives and the means to achieve them (the vertical logic); the rows indicate how the achievement of objectives can be verified (the horizontal logic). The log frame has a hierarchy of project objectives - there are four levels in the log frame and each lower level of activity must contribute to the achievement of a higher level activity. Assumptions must be systematically recorded.

London Club - is an informal group of major creditor banks which meets when required to restructure the commercial debts of borrower governments. Meetings are generally chaired by whichever bank has the largest stake. Despite its name it does not always meet in London. (see also Paris Club.).

London Convention - seeks to prevent indiscriminate disposal of hazardous wastes at sea.

LORCS - League of Red Cross and Red Crescent

Low-Priced Books Scheme - a scheme in which selected text - books suitable for use in overseas universities, technical institutes or teacher-training colleges, or for the teaching of English, are produced under the imprint of the English Language Books Society for sale to students at a fraction of normal prices. About 550 titles are available.

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