by Alex Evans | May 9, 2014 | Economics and development, Global Dashboard, Global system
A couple of days ago, I argued in a post here that while it was welcome that aid flows had reached a new all-time high in 2013, it was bad news that aid was continuing to fall to Least Developed Countries (LDCs). These are, after all, the economies that need aid most, given that – unlike middle income countries – they remain highly dependent on aid (9.7% of their GDP compared to 0.3% of middle income countries’), and much less able to finance their development from other sources like foreign direct investment, remittances, or domestic resources like savings or tax revenue.
With the debate about post-2015 development objectives increasingly focused less on the goals themselves than on the resources that will enable their delivery – “means of implementation”, in UN-speak – I wrapped up the post by repeating a call I’d made in a report last year on a post-2015 Global Partnership for Development, echoing a recommendation made by the UN High-level Panel on the Post-2015 Agenda (itself based on a long-standing UN target):
With the post-2015 agenda now about to move into the home straight, this is the year when donors need to set out a clear timetable for making good on their long-standing promise to give at least 0.15% of their gross national income (GNI) to least developed countries – and ideally go beyond it to 0.20%. And the OECD DAC’s High Level Meeting this December is the right moment to do it.
On which note, I also sent a tweet to the Chair of the OECD DAC, Norway’s Erik Solheim, to put the idea to him: here’s what he came back with.
This is a fair point. If we unpack Solheim’s example of the United States, they only give 0.19% of GNI to aid in total, and 0.07% of GNI to LDCs (here’s the data). So for them to spend 0.15% of GNI on LDCs, as I’m proposing, would be a drastic shift, involving spending more than three quarters of their total aid budget on LDCs.
But Solheim also had another idea:
This is a pretty interesting idea. To stick with our example of the US, this approach would clearly be much less scary in that it would involve much less upheaval in aid allocations. But at the same time, given that the OECD as a whole spent 0.30% of its GNI on aid in 2013, the net result of what Solheim’s proposing would be that LDCs would receive… 0.15% of OECD GNI, the same proportion that I was calling for to start with.
And here’s the really key point: given that the OECD’s analysis of 2013 aid spending suggested that “aid levels could increase again in 2014 and stabilise thereafter”, the implication is that if donors were to commit to spending half their aid on LDCs, then the percentage of GNI could quickly rise to more than 0.15%.
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by Alex Evans | May 7, 2014 | Africa, Economics and development, Global system
So here’s a big surprise. Until last year, global aid flows were declining in the wake of the financial crisis – a trend that was widely expected to continue. But here’s what emerged when the OECD’s 2013 aid statistics came out last month:
Development aid rose by 6.1% in real terms in 2013 to reach the highest level ever recorded, despite continued pressure on budgets in OECD countries since the global economic crisis. Donors provided a total of USD 134.8 billion in net official development assistance (ODA), marking a rebound after two years of falling volumes, as a number of governments stepped up their spending on foreign aid.
An annual survey of donor spending plans by the OECD Development Assistance Committee (DAC) indicated that aid levels could increase again in 2014 and stabilise thereafter.
Admittedly, there are two important qualifiers here. One is that while aid may be at an all-time high in absolute terms, that’s not true for the arguably more important measure of aid as a proportion of donor countries’ gross national income: in 2013 they gave 0.30% of GNI, as compared to 0.32% in 2010 (and way lower, of course, than the 0.7% target).
The other point, flagged up by OECD Secretary-General Angel Gurria in his comments on this year’s statistics, is that the trend of falling aid to the neediest countries, especially in Sub-Saharan Africa (which saw a 4% real terms decrease against 2012), is still happening and appears likely to continue in the future. The new aid stats also show that donor countries only gave 0.09% of their GNI to least developed countries in 2012 – as compared to 0.10% the year before.
Donor countries have got to sort this out. While middle income countries now have access to a huge range of sources of finance for development – foreign direct investment, remittances, commercial debt, portfolio equity, and a vast increase in domestic resources from tax revenue and savings – that doesn’t hold true for low income countries, who are still highly reliant on aid. With the post-2015 agenda now about to move into the home straight, this is the year when donors need to set out a clear timetable for making good on their long-standing promise to give at least 0.15% of their GNI to least developed countries – and ideally go beyond it to 0.20%. And the OECD DAC’s High Level Meeting this December is the right moment to do it.
by Alex Evans | Feb 13, 2014 | Articles and Publications, Speeches
Talk given by Alex Evans to a UK government cross-Whitehall session on the four key multilateral processes culminating in 2015: trade, climate, Sustainable Development Goals, and finance for development. (May 2012)
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by Alex Evans | Jan 6, 2014 | Global Dashboard
In the same spirit of hopeful ideas for a new year as Ben’s excellent post on inequality, herewith some musing of JM Keynes’s about “economic possibilities for our grandchildren“, penned amid the economic Armageddon of 1930.
Keynes took as his timeframe a 100 year period from when he was writing – in other words, what the world might look like 2030. As it happens, this is exactly the same question that governments and others are now looking at in the post-2015 development agenda – so it seems like an apposite moment for a reprise from a man who’s lately been vindicated on a number of other fronts…
I feel sure that with a little more experience we shall use the new-found bounty of nature quite differently from the way in which the rich use it to-day, and will map out for ourselves a plan of life quite otherwise than theirs … What work there still remains to be done will be as widely shared as possible – three hour shifts, or a fifteen-hour week …
We shall be able to rid ourselves of many of the pseudo-moral principles which have hag-ridden us for two hundred years, by which we have exalted some of the most distasteful of human qualities into the position of the highest virtues. We shall be able to afford to dare to assess the money-motive at its true value. The love of money as a possession -as distinguished from the love of money as a means to the enjoyments and realities of life -will be recognised for what it is, a somewhat disgusting morbidity, one of those semi-criminal, semi-pathological propensities which one hands over with a shudder to the specialists in mental disease. All kinds of social customs and economic practices, affecting the distribution of wealth and of economic rewards and penalties, which we now maintain at all costs, however distasteful and unjust they may be in themselves, because they are tremendously useful in promoting the accumulation of capital, we shall then be free, at last, to discard …
I see us free, therefore, to return to some of the most sure and certain principles of religion and traditional virtue-that avarice is a vice, that the exaction of usury is a misdemeanour, and the love of money is detestable, that those walk most truly in the paths of virtue and sane wisdom who take least thought for the morrow. We shall once more value ends above means and prefer the good to the useful. We shall honour those who can teach us how to pluck the hour and the day virtuously and well, the delightful people who are capable of taking direct enjoyment in things, the lilies of the field who toil not, neither do they spin …
I look forward, therefore, in days not so very remote, to the greatest change which has ever occurred in the material environment of life for human beings in the aggregate. But, of course, it will all happen gradually, not as a catastrophe. Indeed, it has already begun. The course of affairs will simply be that there will be ever larger and larger classes and groups of people from whom problems of economic necessity have been practically removed.
by Alex Evans | Nov 23, 2013 | Climate and resource scarcity, Economics and development, Global system
Debate about what new Goals should succeed the Millennium Development Goals after their 2015 deadline is now well underway. But there has so far been much less discussion of another key issue: a new Global Partnership to deliver them.
This is worrying – because although we won’t know the full list of new Goals for another two years, it already seems clear that we’re heading for a much more ambitious set of objectives than the Millennium Development Goals. There’s a real risk of a mismatch between the ‘what’ and the ‘how’ of post-2015, if governments agree an ambitious, universal set of Goals, but fail to commit to a credible action plan for making them happen.
Against this backdrop, I’ve just finished a Center on International Cooperation report (full pdf available here, and 8 page policy brief here) that sets out to explore both what kind of a Global Partnership is needed, and which elements of it look feasible for agreement in the current political context.
The report starts with an assessment of which countries want what from post-2015, and of what sort of goals the new Global Partnership may have to deliver, before setting out analysis and policy options of two key areas: financing, in the broadest sense, and the wider sustainable development agenda (encompassing areas like trade, migration, sustainability, technology, data, and global governance reform).
It also sets out a 10 point ‘early harvest’ plan of measures that could – at a stretch – be agreed over the next two to three years, and which have the potential to act as confidence building measures that might, with luck, start to catalyse more momentum and trust in an agenda that badly needs more of both.
