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32. Trends in Private Capital Flows to Low-Income Countries: Good and Not-So-Good News
- Author:
- Nancy Lee and Asad Sami
- Publication Date:
- 07-2019
- Content Type:
- Policy Brief
- Institution:
- Center for Global Development
- Abstract:
- Interest in mobilizing private finance for SDG investments is surging in a world of stagnating aid, limited fiscal space, and rising LIC debt. But is more reliance on private finance realistic for LICs? This paper explores the performance since the global financial crisis of one source of private finance for LICs: cross-border private capital inflows. Much of the evidence is encouraging, and some of it flies in the face of conventional wisdom. For LICs, private capital inflows are an important and growing source of finance. For the median LIC, private capital inflows are now as large as ODA as a share of GDP. And the FDI component—most of LIC inflows—has been stable and resilient throughout the post-crisis period. Importantly, inflows are not all captured by resource-rich LICs. In 2017, more than half of capital inflows to LICs went to non-resource-rich LICs. Increasingly, policies, not just resource endowments, shape LIC destinations for foreign capital. The relation between median capital inflows/GDP and median regulatory quality is significantly positive for non-resource-rich LICs. And sources of FDI are diversifying. In 2016, China’s stock of FDI in Africa was almost as large as that of the traditional investors: the US, UK, and France. But there is also not-so-good news. Median private capital inflow/GDP ratios are not positively correlated with median private domestic investment/GDP in LICs. Nor is there a significant relationship with median public investment/GDP. The apparent lack of complementarity between foreign and domestic investment may point to problems related to investment enclaves and/or the role of the state in LIC economies. As in other countries, non-FDI inflows to LICs are volatile and sensitive to global commodity prices and interest rates. We find no relation between median country per capita income levels and private inflows/GDP, highlighting the need for caution in IDA graduation policies.
- Topic:
- Development, Capital Flows, Interest Rates, Private Sector, and Capital
- Political Geography:
- Global Focus
33. Chinese Leadership and the Future of BRI: What Key Decisions Lie Ahead?
- Author:
- Brad Parks
- Publication Date:
- 07-2019
- Content Type:
- Policy Brief
- Institution:
- Center for Global Development
- Abstract:
- It’s 2028. The Belt and Road Initiative (BRI) has been underway for 15 years, but the initial enthusiasm and momentum behind BRI has vanished. Many of the governments that initially joined the initiative have publicly withdrawn or quietly wound down their participation. China’s staunchest allies remain engaged but even they have reservations about the wisdom of the initiative. They are saddled with unproductive public investment projects and struggling to service their debts. Domestic public sentiment towards China has soured, and they have come to view their participation in BRI as more of a political liability than an asset. But they worry about the consequences of alienating their most important patron and creditor. China has also assumed a defensive posture. Lacking the goodwill that it possessed at the beginning of BRI, it is now using inducements and threats to prevent its remaining clients from abandoning the initiative. Western donors and lenders watch from the sidelines with a sense of bemusement. They encouraged China to “multilateralize” BRI by establishing a common set of project appraisal standards, procurement guidelines, fiduciary controls, and social and environmental safeguards that other aid agencies and development banks could support. But Beijing chose to go it alone. It opted not to embrace the use of economic rate-of-return analysis to vet project proposals; resisted efforts to harmonize its environmental, social, and fiduciary safeguards with those used by aid agencies and development banks outside of China; and pushed back on the “Western” suggestion that it modernize its monitoring and evaluation practices. China bet that its fast and flexible approach to infrastructure finance would prove to be so compelling that traditional donors and lenders would eventually jump on the bandwagon and co-finance BRI projects. But it miscalculated. Its model was insufficiently attractive on its merits to enlist the participation and support of the other major players in the bilateral and multilateral development finance market. Nor was it sufficiently appealing to sustain elite and public support in partner countries.
- Topic:
- Development, International Trade and Finance, Infrastructure, Leadership, and Belt and Road Initiative (BRI)
- Political Geography:
- China and Asia
34. Five Things the Health Minister Should Do to Enhance the UK’s Global Health Footprint
- Author:
- Kalipso Chalkidou
- Publication Date:
- 07-2019
- Content Type:
- Policy Brief
- Institution:
- Center for Global Development
- Abstract:
- As Health Secretary Matt Hancock returns to his role as part of Boris Johnson’s premiership, he has an opportunity to make good on the UK’s renewed confidence and ambition by drawing on what the new prime minister calls the “best healthcare [system]” to drive improvements in health globally. The UK’s Department of Health and Social Care controls its biggest-ever official development assistance (ODA) budget, doubling between 2017 and 2018 to just under £200m, or 1.3 percent of the country’s aid allocation. This places the UK’s secretary of state for health in a unique position to truly make a difference in countries’ journeys towards universal healthcare coverage (UHC), whilst also defending (and making a case for more of) the ODA money his department has been allocated, even to development aid’s harshest critics. Here are five things he can do to make this happen, both using his own department’s ODA budget and influencing how DFID’s majority share is spent.
- Topic:
- Health, Governance, Health Care Policy, and Leadership
- Political Geography:
- United Kingdom and Europe
35. Five Takeaways on the Future of Humanitarian Reform
- Author:
- Jeremy Konyndyk
- Publication Date:
- 08-2019
- Content Type:
- Policy Brief
- Institution:
- Center for Global Development
- Abstract:
- The world’s humanitarian aid architecture is growing outdated. Relief programs are most effective when they are integrated, locally owned, and demand driven. But humanitarian action in the 21st century remains constrained by a 20th-century aid model: siloed, supply driven, and centered on the individual mandates and sectors of major international aid agencies. This makes aid both less effective and less responsive than it could be. In a world where displacement is at the highest levels in generations, climate disasters are increasing, and humanitarian funding is beginning to level off, this disconnect is no longer tenable. But fixing it is not a simple matter—multiple rounds of humanitarian reform over the past 15 years have made progress but fallen short of fundamental change. Earlier this summer in Geneva, CGD convened two high-level private roundtables, one with leaders from humanitarian donor institutions and another with senior executives from major humanitarian aid agencies (both multilaterals and NGOs), to discuss how to make humanitarian aid more cohesive and user-centered. The meetings were part of a multiyear research initiative exploring how modernizing the humanitarian business model and humanitarian governance are integral to improving field-level humanitarian impact. CGD teed up the conversation with three emerging ideas from our research (you can see the presentation slides here). These ideas—the subjects of several forthcoming papers CGD is developing —explore ways of better aligning aid delivery around enhanced impact toward affected people’s priorities
- Topic:
- Development, Humanitarian Aid, International Cooperation, Reform, and Humanitarian Intervention
- Political Geography:
- Global Focus
36. Promoting Investment in Research for Development Outcomes: A Research Ventures Fund at the World Bank
- Author:
- Scott Morris
- Publication Date:
- 08-2019
- Content Type:
- Policy Brief
- Institution:
- Center for Global Development
- Abstract:
- This note proposes a new Research Ventures Fund (RVF) at the World Bank to better prioritize R&D investments in support of development progress. The RVF would employ financing mechanisms that are consistent with research needs: significant scale and scope, patience, and tolerance for failure. Existing development-oriented research consortia like CGIAR would provide a promising start for RVF funding allocations. Donors to the IDA-19 replenishment should take the first step in securing funding for the new fund in 2019.
- Topic:
- Development, International Cooperation, Science and Technology, World Bank, Finance, Research, and Banking
- Political Geography:
- Global Focus
37. Building on Digital ID for Inclusive Services: Lessons from India
- Author:
- Alan Gelb and Anit Mukherjee
- Publication Date:
- 09-2019
- Content Type:
- Policy Brief
- Institution:
- Center for Global Development
- Abstract:
- India has emerged as a leader in building on its biometric digital ID (Aadhaar) to reform service and program delivery. It moved quickly to consolidate the rollout of Aadhaar, and then to embed the unique Aadhaar number into program databases. A range of applications, including digital signature and payments, was then constructed on top of the Aadhaar foundation (the India Stack). Together with partners, the Center for Global Development is analyzing the effects of Aadhaar-based reforms. India offers lessons for many other countries as their focus evolves from rolling out an ID system towards using it to improve the efficiency and inclusivity of service delivery. Some programs using Aadhaar are federally administered but others are implemented at state level. It is already clear that some states and sectors are reforming better than others, generally because of better design of the digital reforms or stronger capacity to implement them. The three programs we discuss below high- light achievements as well as challenges that need to be overcome for greater efficiency and inclusion.
- Topic:
- Development, Governance, Identities, and Digitalization
- Political Geography:
- India and Asia
38. Why Uncertainty in Global Health Interventions Matters—and What We Can Do About It
- Author:
- Kalipso Chalkidou, Anupama Dathan, and Francis Ruiz
- Publication Date:
- 09-2019
- Content Type:
- Policy Brief
- Institution:
- Center for Global Development
- Abstract:
- Global health interventions, like many public policies, are rife with uncertainty. Will a program, such as a malaria prevention strategy that looks strong on paper, work as intended? Will a new technology, such as a specific drug or device that appears effective in clinical trial settings, work in practice and provide good value-for-money? In the case of programs made up of a complex interaction of multiple interventions, implementers often create a theory of change and then meticulously track whether it is being followed every step of the way, from each input translating into the prespecified activity, and the activities yielding the right outputs and the expected outcomes. When observational data is available that permits quantitative analysis (evaluation), it may also be possible to estimate causal impact in a given setting by applying experimental methods (such as a randomized controlled trial) or quasi-experimental techniques (such as difference-in-difference analysis). Such program evaluations generally consider outputs (e.g. the number of bed nets distributed) and relatively short-term outcomes (e.g. malaria infections following bed net distribution). Many eval- uations also collect data years after the program to identify longer-term impacts. Cost-effectiveness calculations are sometimes conducted after ascertaining the cost and impact of the program, but such analyses aren’t necessarily considered when determining whether to implement a certain program or technology—especially when politics and other concerns get in the way. Discrete clinical interventions and technologies (which are defined as including clinical interven- tions, drugs, diagnostics and even public health programs) are usually the subject of health technolo- gy assessment (HTA) to inform coverage decisions in many contexts. The underpinning evidence base for HTA typically involves a synthesis of randomized trial data, designed to reduce bias in estimating causal inference and relative effectiveness. Trial data is then combined with information from other sources and study designs to develop models of the technology’s long-term health and cost impact in a given context. A key feature of both programs and technologies is uncertainty.
- Topic:
- Health, International Cooperation, Science and Technology, Humanitarian Intervention, and Pharmaceuticals
- Political Geography:
- Global Focus
39. Moving Beyond the Emergency: A Whole of Society Approach to the Refugee Response in Bangladesh
- Author:
- Lauren Post, Rachel Landry, and Cindy Huang
- Publication Date:
- 10-2019
- Content Type:
- Policy Brief
- Institution:
- Center for Global Development
- Abstract:
- Bangladesh provides a significant global public good by hosting over one million Rohingya refugees. Most are living in camps in Cox’s Bazar district, where resources and livelihoods are strained. The refugee situation is likely to be protracted, and medium-term planning is critical. CGD has been working with local and international partners to understand what that medium-term response could look like. This is one of five publications where we outline steps for developing a medium-term plan for Bangladesh, to benefit refugees and their host community alike. The other four cover forest and landscape restoration, trade, private sector investment, and labor mobility.
- Topic:
- Development, Refugees, Social Services, Humanitarian Crisis, and Public Service
- Political Geography:
- Bangladesh and Asia
40. When Does “What Works” Work? And What Does that Mean for UK Aid R&D Spend?
- Author:
- Charles Kenny, Euan Ritchie, and G. Lee Robinson
- Publication Date:
- 10-2019
- Content Type:
- Policy Brief
- Institution:
- Center for Global Development
- Abstract:
- The UK’s Secretary of State for International Development[1] oversees an aid-financed R&D[2] budget that is larger than that of the next 15 biggest donors combined. [3] At the moment, a considerable proportion of that UK R&D spend goes towards solving global technological challenges related to neglected tropical diseases including malaria, and a considerable proportion again towards local evaluation of aid-financed development interventions. Much of the rest is somewhat opaquely distributed to British universities for research supposedly related to development. As well as reform of this last category, the range of more legitimate activities benefiting from ODA “research and development” calls for innovation in approaches to deliver outcomes. This paper will argue there is a (fuzzy) spectrum of development procedures, for some of which global innovation, evaluation, or “best practice” can be informative, for some of which local evaluation or experimentation can be useful, and for some of which perhaps only practical experience and local wisdom can help. That there is a spectrum of intervention types and research opportunities, and that local evidence is often required, has implications for the kind of research that UK aid can usefully support as part of its R&D program and where that research should happen. In turn, that suggests a reform agenda for the way UK ODA for R&D is currently spent.
- Topic:
- Development, International Cooperation, Foreign Aid, and Research
- Political Geography:
- United Kingdom and Europe