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Begin New Search Topic Development Content Type Policy Brief

51. Maximising EU Concessional Finance for Greater Leverage and Impact: An Options Spread

Author:
Mikaela Gavas, Samuel Pleeck, Andrew Rogerson, San Bilal, and Karim Karaki
Publication Date:
03-2024
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
Already constrained by the economic aftershocks of COVID-19, the impact of the war in Ukraine, and the food and climate crisis, low-income countries and lower-middle-income countries now face a combination of soaring debt and high interest rates. Confronted with insufficient liquidity to respond to these challenges and unable to access capital markets, they need additional concessional finance, in the form of grants and soft loans. The European Union (EU) already provides concessional finance, but it is not nearly enough to respond to their growing needs. With European budgets under more strain than ever, this paper puts forward the case for finding ways to maximise the overall efficiency and impact of European concessional finance and in doing so, better articulating and combining grants and concessional loans in its support and investment toolbox. To remain relevant and maintain relationships and influence with partner countries–even more in a world characterised by the polycrisis and geopolitical fragmentation–the EU will have to step up its game when it comes to providing more strategic concessional finance. The paper sets out six complementary and non-mutually exclusive options for maximising EU concessional finance with a view to a strategic set of decisions to be made for the next EU Multiannual Financial Framework.
Topic:
Development, European Union, Financial Institutions, and Sustainable Development
Political Geography:
Europe

52. Disinvesting from Low-Value Health Technologies in Low- and Middle-Income Countries: Between a Solution to the Current Fiscal Crises and a Costly Mirage?

Author:
Adrian Gheorghe and Pete Baker
Publication Date:
04-2024
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
In this policy paper we summarise what is known about healthcare disinvestment and outline documented experiences in low- and middle-income countries (LMICs) to draw insights on what has worked, to what extent, and under what conditions. We reviewed the published literature on documented experiences of attempted healthcare disinvestment in LMICs. We identified two common scenarios when disinvestment initiatives were attempted, namely “one-off” and “systematic” initiatives, and characterised them in terms of objectives, resources and political will. We found four documented examples of one-off disinvestment initiatives—Iran, Malaysia, Romania, and Vietnam, two documented examples of systematic disinvestment initiatives by health technology assessment (HTA) agencies in LMICs—Brazil and China, as well as a range of countries like Thailand, India, and Ghana that carry out systematic disinvestment through routine HTA processes. We conclude that disinvestment is costly, time-consuming, and rarely as successful as policymakers intend. Key considerations to improve the chances of success include whether strong pre-existing health prioritisation systems exist (such as an HTA agency) and whether the design of initiatives are tightly matched to the level of political will, the policy objective, and available resources.
Topic:
Development, Science and Technology, Global Health, and Fiscal Crisis
Political Geography:
Global Focus

53. Why and How Multilateral Development Banks Support Improved Outcomes for Economic Migrants and Refugees

Author:
Helen Dempster, Martha Guerrero Ble, and Stephanie López Villamil
Publication Date:
05-2024
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
Economic migrants and refugees can bring both benefits and costs to their hosting countries. If well-integrated, they can support themselves, their families, and their hosting countries as producers and consumers. Both economic migration and forced displacement are therefore integrally linked with development outcomes. Recognizing this, multilateral development banks (MDBs) are supporting their beneficiary member countries to improve outcomes for economic migrants and refugees, in the form of billions of dollars in grants and loans, as well as technical assistance, policy dialogues, and knowledge exchanges. This paper provides an introductory snapshot of some of the financing instruments, projects, and strategies used; particularly innovative approaches; and challenges MDBs face in expanding their engagement. It is hoped this paper will be useful to anyone who engages with MDBs and wants to understand how they engage on economic migration and forced displacement, particularly as these issues continue to grow in importance.
Topic:
Development, Migration, World Bank, Refugees, and Banking
Political Geography:
Global Focus

54. ABCs of the IFIs: Understanding the World Bank’s IDA21 Replenishment

Author:
Erin Collinson, Clemence Landers, Justin Hurley, and Grace Miner
Publication Date:
06-2024
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
The International Development Association (IDA)—the World Bank’s arm that works in low- and lower-middle-income countries—is one of the largest sources of development assistance for the world’s poorest countries. It is also a crucial tool for resource-constrained governments to borrow on affordable terms compared to other creditors, including Chinese entities. IDA supports eligible countries whose annual per capita incomes fall below an established line (currently $1,315 in FY2024). Because IDA provides grants and highly subsidized loans to its client countries, its funds need to be replenished by donors every three years. Replenishments are year-long negotiations where the World Bank’s shareholding countries, of which the US is the largest, negotiate a policy and financing package for the next three-year cycle. This year, 2024, is an IDA replenishment year for the institution’s twenty-first round of funding (“IDA21”), culminating with a pledging session in December to finalize IDA21’s financing envelope.
Topic:
Development, World Bank, and International Development Association (IDA)
Political Geography:
Global Focus

55. The EU’s Global Role: A Third Node of Power

Author:
Mikaela Gavas and W. Gyude Moore
Publication Date:
07-2024
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
In recent years, a quest for economic security and strategic autonomy have come to define the European Union (EU)’s politics. The need to compete globally for the finite resources required for the green and digital transitions, and rivalries between the US and China for global dominance, are all driving this agenda. And while the COVID-19 pandemic and the war in Ukraine highlighted countries’ global dependencies, deepening geopolitical tensions have brought national security considerations to the fore. At the same time, the rise of populist parties across Europe is fuelling calls for countries’ national interests to play the defining role in development cooperation. This presents a challenging environment for EU development cooperation. Caught up in this new paradigm, development cooperation is increasingly viewed as a lever of hard power and an instrument of influence which can be used to reinforce Europe’s strategic autonomy and economic security. With European interests central to EU development cooperation strategy, the climate of distrust between Europe and its partners is being heightened, given the not-so-distant memory of European vaccine “nationalism” during the COVID-19 pandemic, the different standards some Europeans apply with regards to fossil fuel exploration and the negative repercussions the Green Deal will have on African countries’ growth and development. However, shaping EU development policy in this fashion, with geostrategic interests at its forefront will be more detrimental than helpful for the EU in the medium to long-term, and carries the risk of fuelling conflicts of interest with partners. Geo-economic fragmentation and a trust deficit when it comes to governments and societal institutions are threatening our ability to address pressing global challenges. In Africa, this fracturing is evident in the plethora of Africa plus-one summits, for example, the first ever Korea-Africa summit. Instead of using multilateral vehicles to address development cooperation, this new environment has spawned a diversion of resources toward more bilateral initiatives, where the geopolitical returns are direct and attributable. In this piece, we propose a reset of the EU’s international relations narrative and “third way” for the EU to position itself as a global development player.
Topic:
International Relations, Development, European Union, and Green Transition
Political Geography:
Europe

56. Displacement as a Development Issue: Enabling Public Policy to Unlock Climate Finance in Asia and the Pacific

Author:
Steven Goldfinch
Publication Date:
07-2024
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
Internal displacement in the context of climate change and disasters is now recognized as a development issue with humanitarian consequences. As countries gain a greater understanding of the underlying drivers of displacement, and the corrosive effect it has on development outcomes, re-positioning public policy will be critical in prevention and solutions. To implement these responses, greater volumes of development financing is required. In the absence of dedicated instruments or resources to respond to displacement, utilizing existing sources of development finance, including climate adaptation finance, offers an important stream. This paper looks at the current public policy approaches to displacement across Asia and the Pacific, provides insights into selected country approaches, and explores the role of existing development finance, including the role of climate financial intermediary funds, in reducing the drivers of displacement.
Topic:
Climate Change, Development, Displacement, and Public Policy
Political Geography:
Asia-Pacific

57. Starting from the Source: Methods and Priorities for Explaining Lead Exposure

Author:
Rachel Bonnifield
Publication Date:
08-2024
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
Lead is a dangerous neurotoxin, and lead poisoning remains one of the most serious and neglected public health challenges in the developing world, with major negative impacts on global health, education, and overall economic development. There is now growing international momentum to mitigate lead pollution, with the goal of dramatically reducing human lead exposure and consequent adverse effects. Yet before lead exposure can be effectively mitigated, it is essential to understand why humans are being exposed to lead in the first place and therefore how policymakers can intervene to stop further exposure. To date, such research into the major sources of lead exposure—broadly referred to as source assessment—in developing countries has been limited. Thus, there is limited information and no global scientific consensus about the most important causes of global lead exposure. Given growing global interest in addressing lead poisoning, there is an urgent need to better understand the major sources of lead exposure in different settings by increasing the volume and quality of related research. Tailored to a policy audience, this paper offers a state-of-the-science review of methods for doing so. First, it provides background for understanding lead exposure—that is, how and why lead enters the environment, how it behaves once there, and how environmental lead results in elevated blood lead levels for humans. Second, it outlines basic principles for source assessment, including a discussion of objectives and terminology. Third, it details the range of methods available for understanding the sources of lead exposure and describes how such methods can be used in combination to understand major sources of lead exposure in a given context. Finally, it considers major policy-relevant gaps in the literature base about sources of global exposure and offers suggestions for a research agenda in this space.
Topic:
Development, Public Health, Global Health, and Lead
Political Geography:
Global Focus

58. Transforming EU Climate Leadership through CBAM Reform

Author:
Ian Mitchell and Beata Cichocka
Publication Date:
09-2024
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
The EU’s Carbon Border Adjustment Mechanism (CBAM) incentivises key countries, including China and India, to assess their policies around industrial carbon emissions. But CBAM faced criticism from low-income countries at COP28, with evidence suggesting that its economic impact on Africa could be as much as three times the amount of EU aid to the continent. While major emerging economies should face the full incentives from CBAM, lower income countries require a different approach. The Commission must review CBAM's impact on least developed countries (LDCs) by 2025. We propose it collaborates with the Council and Parliament to reform CBAM in two ways: Implement a longer transition period for LDCs, following the principle of "Common but Differentiated Responsibilities" Revisit the European Parliament’s proposal to allocate additional finance to the most vulnerable countries, by proposing that CBAM revenues be used to finance climate-related loss and damage, amounting to around 1 percent of the Commission’s annual budget by 2030. These reforms would show the EU is listening to partner countries and provide a new and additional source of climate funding. This would transform its reputation and strengthen its international negotiating position.
Topic:
Climate Change, Development, European Union, Carbon Emissions, and Carbon Border Adjustment Mechanism (CBAM)
Political Geography:
China, Europe, and India

59. Making Migration Work for Adaptation: Classifying Remittances as Climate Finance

Author:
Samuel Huckstep and Jonathan Beynon
Publication Date:
10-2024
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
Labour migration programmes targeted towards climate-vulnerable populations can provide transformative finance, raising household incomes and allowing adaptation. Current flows of adaptation finance are highly insufficient. Mobilisation of private adaptation finance is very low, despite commitments to increase mobilisation. Targeted labour migration programmes can leverage private adaptation finance at a high level of efficiency. Incentivising the selection of migrant labour from communities most vulnerable to climate change by counting a portion of their remittance flows as mobilised private climate finance may therefore have significant benefits.
Topic:
Climate Change, Development, Migration, Adaptation, and Remittances
Political Geography:
Global Focus

60. Localization in Theory and Practice

Author:
Ranil Dissanayake
Publication Date:
10-2024
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
The movement for localization in foreign aid presents philosophical and practical challenges for providers of foreign aid. In the past, some level of localization (to at least state actors) of both decision-making and spending could be achieved through general and sector budget support, a logistically simple (though politically difficult) approach. Current practices, with more aid disbursed in the form of discrete projects, make localization more difficult to achieve. For development agencies to make progress they must confront conceptual, practical and strategic challenges. This paper suggests practical definitions of different kinds of localization and what they seek to achieve, points out trade-offs between them and sets out how they challenge current conceptions of how and what foreign aid seeks to do, as well as suggest limits to the optimal extent and type of localization. It then considers practical difficulties in implementing these different conceptions of localization given existing donor practices and capacities, and the strategic challenges of realizing the desired outcomes—specifically principal-agent problems within the organization and with contractors. It concludes with key lessons and messages for donors and funding agencies.
Topic:
Development, Humanitarian Aid, Reform, USAID, and Localization
Political Geography:
Global Focus