Official Development Assistance are resource inflows provided by multilateral  institutions and foreign countries through bilateral agreements with the objective of promoting the economic development and welfare of the recipient country.  

ODA, in contrast with other external resource inflows, is mainly concessional.  Concessionality refers to the degree of grant element constituting the assistance.  The ODA Act of 1996 (R.A. No.8182) as amended by RA No. 8555 defines ODA as flows with a grant element of at least 25 percent at a 10 percent discount rate.

ODA may either take the form of soft loans or grants.  Soft loans have interest rates, which may range from zero to seven percent, maturity periods ranging from ten to 50 years and grace periods of five to ten years.  ODA grants, on the other hand, have no repayment obligation and are mainly provided in the form of experts, consultancy services, equipment, commodities and training.