IMF/WB Development Committee communiqué devoid of concrete actions.

The watchdog Bretton Woods Project critiqued recent communication at the conclusion of recent G20/24 and IMFC meetings. Full commentary here. 

Extract below. 

The Development Committee is a joint committee of the boards of the International Monetary Fund (IMF) and the World Bank (Bank), which is meant to advise the Bank and the IMF on critical development issues and the resources needed to promote economic development.

The Development Committee communiqué name-checks various critical issues, but is almost completely devoid of concrete agreements or actions. Job creation, economic instability, agriculture all get mentions, but no new proposals or agreements are detailed. Instead, the role of the private sector is highlighted several times, implying that solutions will need to be found outside of government action. For example while noting that "We must put agriculture and food security at the top of our development priorities," the solution is "to harness the creativity and resources of the private sector." See full details here.

Sustaining Best-practice International Capacity Development with Human Performance Technology

KNO partners Steven J. Kelly and M Mari Novak, along with colleague Patrick C. Coughlin have just issued a white paper focusing on the impact of human performance technology (HPT) methods on strengthening international capacity development. 

HPT is a systemic approach to improving productivity and competence, using a research validated set of methods and procedures -- and a strategy for solving problems -- for realizing opportunities related to the performance of people and institutions.  

An abstract is below and the short paper linked here.

Abstract 

In 2006, OECD-DAC issued a set of best practices in Capacity Development. Since then, Human Performance Technology (HPT) has been able to successfully support their implementation via shared principles. These principles focus on a systemic and systematic approach to performance improvement along the organization and its enabling environment, work processes and workers. This paper explores both why and how HPT is flourishing as the methodology of choice within the current and future Capacity Development environment. This future will feature leaner donor aid budgets and ever more complicated theoretical frameworks, which may detract practitioners away from tested shared principles. This paper reaffirms the validity of those principles.

Full paper here.

Developing Countries Becoming Less Aid Dependent

A recent report released Sept. 13 by international non-governmental organization ActionAid, asserts that some of the world’s poorest countries, including Ghana and Mozambique, have become less reliant on foreign aid in the past 10 years.  

The short Executive Summary:  There is good news. Developing countries are getting less dependent on aid.

ActionAid praises Ireland, Denmark and the United Kingdom for their focus on providing more “real aid” that “has few strings attached” and puts developing countries “in the driving seat of their own development.”

Excerpts from the report (linked here) below:

“Our research shows that more developing countries are becoming less dependent on aid and are able to rely increasingly on their own resources to deliver essential services,” Anna Thomas, ActionAid’s head of economic and social development, said in a statement. “These results show we’re moving in the right direction — and means that good quality aid — real aid — is working.”

The organization also noted the report shows a promising turn in how aid is provided, with more donors focusing on value for money and getting results. This contributes to a reduction in developing countries’ aid dependency, ActionAid says.

Some of the world’s richest countries, however, have yet to adopt this focus on “real aid,” ActionAid said, naming Germany and France as two of the countries still providing “substandard aid.”

“To qualify as real aid, the aid must be targeted at the poorest and the recipient country must be given the space to own and lead its own development plans,” the organization explained in a statement. “Real aid is not tied, is administered efficiently and is used in the recipient country.”

There has been growing recognition among donors and other members of the international community for the need to change how aid is provided to some of the world’s poorest countries. The U.K., in a relaunched aid approach, said it aims to help its recipient countries graduate from needing assistance and reach a point where they can meet the needs of their people using their own resources.

As reported in Devex, The Organization for Economic Development, meanwhile, recently adopted a new framework that recognizes the importance of promoting sustainable and inclusive economic growth and the need to continue to redefine the relationship between donors and developing countries. This framework is expected to become the foundation of a new OECD strategy for development.

Aid for Trade

Frans Lammersen of the OECD Development Co-operation Directorate writes about the practicalities of building trade from aid investments. 

Excerpt below.  Full article linked here.

 Evidence from a numerous countries, including Korea, Brazil and China, shows that openness to trade is a key ingredient for economic success and improved living standards. By connecting local producers to domestic, regional and global markets, trade helps to fight poverty and enhance the productive capacity of the whole economy. It facilitates the availability of technology, know-how and other services. It helps to make goods cheaper and more widely available. It also weakens the grip of local monopolies. 

But simply opening the economy to international trade is not enough. A trade strategy requires investment in human capital (education, health and nutrition) and rural infrastructure, provision of access to credit, and safety nets and policies to promote economic and political stability. Aid for Trade plays a key role by helping countries strengthen their productive and institutional capacity.  Read more here...

Lessons on the Complexity for the Results Agenda

Managing better for results, not just measuring them better: lessons on complexity for the results agenda.

 

Paper link here

Excerpt:

Recent reforms at DFID, USAID and elsewhere attempt to improve the quality of aid by stressing a more robust focus on results. So far, this has largely translated into a more rigorous measurement of impact, tying impact assessments to existing systems that shape implementation. Unfortunately, lessons from elsewhere suggest this will be insufficient to ensure ‘smarter aid’ delivers the envisaged increase in effectiveness, unless agencies start to rethink the underlying systems and accountabilities themselves. More specifically, agencies need to recognise the complexity of the many problems they face, and adjust implementation structures accordingly.

Initiatives under the ‘results agenda’ often rest on the judgement that  evaluation in development has paid insufficient attention – or insufficiently rigorous attention – to the effect a programme has on its surroundings, and to the wellbeing of people in developing countries. This is a valid judgement and reflects a solid appraisal (as evidenced by an ODI study of evaluation in development agencies), and will direct resources and political capital to an area where they are much-needed.  However, a good deal of the debate – from myself included – has focused on which methodology to use to measure results, rather than the broader context of how information on results can feed into systems for decision-making and accountability.  

Continued... read full article linked here.

Feeding the World

Caroline Hanshaw, in a recent commentary in The Wall Street Journal, writes that according to the Organization for Economic Development and Cooperation, continuing with “business as usual” in world food systems simply isn’t going to cut the mustard.

Excerpts below:

In a new joint report (linked here) with the United Nations’ Food and Agriculture Organization being presented at an expert conference in Paris this week, the OECD argues that not only do we need to boost our agricultural output by 70% by 2050, but we have to do this in an environmentally sustainable way.

Yield growth has slowed from an average of 2-3% between 1961-1990 in key crops such as maize, rice and soybeans to 1% or less between 1990-2007.

Climate change has put more pressure on stretched world resources in breadbasket regions in the U.S., India and Africa. And now, with global cereals demand expected to rise by a billion tons over the next four decades, many warn the era of low food prices is over.

According to the OECD, the new approach must be threefold:

• growth must be sustainable and come at a limited long-term cost to the environment

• markets must function well enough to provide price signals that reflect the scarcity of raw materials

•  land rights must be defined to encourage the best use of these resources.

These recommendations may sound logical enough, but with billions of dollars across the world tied up in agricultural and biofuels subsidies and the pressure of millions of hungry mouths weighing on policymakers’ minds, deciding how to proceed will be far from simple.

Read full commentary here.

World Risk Index Identifies Vulnerable Countries

As highlighted in recent Devex and Irin Global reports, the United Nations University has launched a risk index that could help donors and aid agencies have a better grasps of the vulnerability of different countries to calamities and, as a result, better tailor international response and resilience-building initiatives to disaster-prone countries.

The World Risk Report 2011 (link here) was created by the U.N. University Institute for Environment and Human Security in Bonn along with five German non-governmental organizations. The index takes into account a country’s economic, political and ecological factors in determining its capacity to respond to disasters, IRIN News says. 

The data may assist donors and aid organizations to better understand why some countries are more at risk of calamity than others, and shape their responses when disaster strikes.

The World Risk Index (WRI), explained Jörn Birkmann, scientific head of the WRI project at the UN institute, is unique in defining risk as the interaction between a natural hazard and the vulnerability of a particular community. It helps plan not only short-term responses but also long-term interventions.

“The index gives you all that information at a glance — showing the strength of a particular area’s capacity to adapt or cope in percentages, which is useful to communicate the strengths and weakness of a particular area when you are seeking funding from donors,” the ERIN news agency quotes Jörn Birkmann, the scientific head of the team in charge of developing the index.

The index examines four key components: exposure to hazards, susceptibility to damage caused by potential disasters, capacity to cope, and existing adaptation strategies. 

Assessing countries based on these components, the index identifies the Vanuatu, Tonga, the Philippines, Solomon Islands and Guatemala as the top five counties most at risk.

Ideas On Reforming US Foreign Assistance

As the United States labors under the longest economic crisis of recent times, foreign aid has once again come under fire. The American people and their representatives in Congress have questioned whether generous aid programs are paying off, citing cases like Pakistan, a recipient of billions in US taxpayer funds and the home of the late Osama bin Laden, as a prime example. 

But there are also humanitarian demands on the US checkbook, such as the current drought in the Horn of Africa. Under tight budget constraints, it is vital that foreign aid achieves its goals. But is the half-century-old Foreign Assistance Act of 1961 doing the job?

Representative Howard Berman (D-CA) is proposing draft legislation which works to streamline, direct, and accurately measure the success of US foreign assistance. His remarks recently at AEI are presented in video below.

Some commentary from the US Global Leadership Coalition is excerpted below. The full article is here.

For years, the holy grail of foreign assistance reform has been a re-write of the Foreign Assistance Act of 1961, widely seen to be outdated and cumbersome. After 2008, then-Chairman of House Foreign Affairs Committee Howard Berman (D-CA) began to work on such a reform bill. Control of the House of Representatives switched in 2010 before it was completed, but now-Ranking Member Berman released a draft recently intended to contribute to the future debate on reform. While he and his staff know their draft is unlikely to become law, the draft makes a significant step forward in thinking on what such a reform could and should entail.

“Aid is not a gift,” Congressman Berman said in his introduction of the Global Partnerships Act of 2011 recently at an event co-hosted by the American Enterprise Institute and the Brookings Institution. “The United States provides foreign assistance because it serves OUR interests. Helping countries become more democratic, more stable, more capable of defending themselves and better at pulling themselves out of poverty is just as important for us as it is for them.”

In today’s climate where most of the foreign assistance conversation is about cutting budgets, the Berman draft bill focuses on the structure and rationale of foreign assistance, driven by fifty years of experience in what makes programs more efficient, more impactful, and more lasting...

This draft, while still a far ways from binding legislation, marks an important first step towards making U.S. assistance as efficient as possible. But it is important to keep in mind, as Congressman Berman pointed out, that we do not have the luxury of slowing down our commitment to our current programs, which have already seen improvements through the USAID Forward initiative and the QDDR. In an ideal world we could “hit pause,” evaluate all the necessary reforms, and then resume our investments in development and diplomacy.

Private Sector Collaboration Makes Aid More Effective

Peter Davis, a research fellow in the Overseas Development Institutes's private sector and markets program, recently published an opinion piece in the UK Guardian. His focus is on improving effectiveness of donor aid through engagement of the private sector. Several excerpts are below, the full piece linked here.

The question of aid effectiveness has moved to the centre of development debates. If donors want to make their aid more effective, then they need to engage strategically with the private sector.

We know that development of the private sector is probably the most powerful tool in lifting people out of poverty. As a strategy paper for the Dutch foreign ministry puts it, "the private sector ... is at the heart of the development process. Driven by the quest for profit, they invest in new markets and new facilities that strengthen the foundation of the economy."

Of the countries that have been most successful in emerging from poverty in the past five decades, it is the private sector that has driven the process. For example, a study, carried out by Unctad, the Indian government and the UK's Department for International Development (DfID) found that increases in exports from India between 2003-04 and 2006-07 led to the creation of 26m jobs and to $55bn in additional income. In China too, a recent study found that the private sector not only contributed to economic growth, but also helped the country to cope with the societal impacts of the decline in state industry.

We are also beginning better to understand the mechanisms through which specific industries impact on poverty reduction and development. Take tourism as an example: an Overseas Development Institute-World Bank review identifies three mechanisms...

As the example of tourism illustrates, value chains of international investors are extremely powerful as a tool for broad-based development. According to the Dutch NGO the Centre for Research on Multinational Corporations (Somo), the value chains of international investors "may positively contribute to development in a number of ways ... including economic (economic growth and productivity), social (poverty reduction, employment creation and human rights) and environmental (pollution and environmental destruction) components"...

Photograph: Str/AFP/Getty Images

How can donors best harness this energy? Considerable effort has been put into many initiatives over the past decade and a half: yet still private sector development remains peripheral to most donor activity. Where might attention be best focused if we are to develop a more strategic engagement between the donor community and the corporate sector? ODI is exploring a number of possibilities, such as:

• Building on the guiding principles.

• Rethinking the UN Global Compact. 

• Engaging the corporate sector at a country level. 

• Moving the corporate sector more centrally to the operations of donors. 

We need to recognise that donors and companies perform different roles in the development process, and that a more joined-up complementary approach is needed. By engaging more strategically with the corporate sector, donors will be better able to leverage their limited resources, and to demonstrate that their efforts genuinely contribute to pro-poor growth. By collaborating with companies, donors can make aid work.

Read full article here.

Looking Toward 2015 Millennium Development Goals

In a recent column in the Poverty Matters Blog from the UK Guardian, Alicia Yamin brought up the need to begin planning for the successor agreement. A few excerpts from her commentary are below - full article linked here.

"The latest UN progress report is linked here.

Whatever replaces the MDGs must respond to critics of the original goals. This means targets must be tailored to the needs of individual countries and more people must be involved in the process...

As the 2015 deadline for the millennium development goals (MDGs) draws near, there is an urgent need for inclusive global consultations to draw up a successor agreement. In September, the UN general assembly will meet to discuss how the pace can be accelerated, and what should replace the current framework after 2015...

The successor goals and targets must consider lessons from the current set of MDGs, which are extremely narrow. They focus on sub-sections of certain social sectors and selective human needs. Greater balance could be achieved by including such challenges as creating decent work, reinforcing social protection, and increasing productivity; addressing climate change and its disparate impacts on the poor; ameliorating risks of global financial and commodity market crises; ensuring fairer trade rules; and, finally, reducing gaping inequalities within and between countries, based on class, gender and ethnicity, among other factors...

The MDGs are global targets; they must be adapted at the national level to reflect each country's specific capacities, constraints and challenges.

One of the principal failures of the MDGs has been a lack of accountability for meeting goals in an equitable, transparent and participatory manner that promotes sustained institutional change. The absence of quantifiable commitments for trade, debt, aid and technology transfer has made it particularly difficult to hold the international community to account...

As a survey of more than 100 southern civil society groups recently affirmed, "the process of deciding what comes after the MDGs will be as important as the framework itself" ...

The UN secretary general has acknowledged the need to set a more ambitious development agenda beyond the current MDGs. An urgent and critical first step is to start a process of broad consultations on the post-2015 goals...

Such consultations will require time, involving local, national, and regional debate. They must involve key stakeholder groups, including national governments, national and international civil society organisations and networks, the private sector, and bilateral and multilateral development agencies. Time is short for this process if it is to be meaningful."