Official Development Assistance (ODA) flows are defined as grants and loans to the official sector of countries and territories on the DAC List of ODA Recipients, INGOs and multilateral development institutions which are: 
(a) provided by official agencies, including state and local government, or by their executive agencies; and 
(b) each transaction of which is: 
(i) administered with the promotion of the economic development and welfare of developing countries as its main objective; and 
(ii) is concessional in character. In DAC statistics, this implies a grant element of at least: 

• 45 per cent in the case of bilateral loans to the official sector of LDCs and other LICs (calculated at a rate of discount of 9 per cent). 
• 15 per cent in the case of bilateral loans to the official sector of LMICs (calculated at a rate of discount of 7 per cent). 
• 10 per cent in the case of bilateral loans to the official sector of UMICs (calculated at a rate of discount of 6 per cent).
• 10 per cent in the case of loans to multilateral institutions (calculated at a rate of discount of 5 per cent for global institutions and multilateral development banks, and 6 per cent for other organisations, including sub-regional organisations). 
• 10 per cent in the case of loans to INGOs (calculated at a rate of discount of 6 per cent).

Grants and ODA loans entering the calculation of the ODA grant equivalent measure are referred to as ODA flows. The donor effort in providing ODA-eligible private sector instruments (PSI) is included in the ODA grant equivalent measure too.