While the UK negotiates its exit from the EU, the EU will be negotiating over its own budget for the period from 2020-2026 as part of the Multi-Annual Financial Framework. So, where will EU development aid be a quarter of the way through the 21st century?
CGD Policy Blogs
In 2016 on the CGD Podcast, we have discussed some of development's biggest questions: How do we pay for development? How do we measure the sustainable development goals (SDGs)? What should we do about refugees and migrants? And is there life yet in the notion of globalism? The links to all the full podcasts featured and the work they reference are below, but in this edition, we bring you highlights of some of those conversations.
In no particular order, a suggested list of things to do—and things not to do.
“Cat” bonds are effectively a cheaper source of large-scale insurance coverage against clearly measured risks like earthquakes, storms, or even disease outbreaks. Generally, though, coverage hasn’t trickled down to the poorer and most at-risk countries—precisely those which are most vulnerable when aid fails to arrive or arrives piecemeal. Scaling up this market for lower-income countries would provide better shielding against many risks that undermine development overseas.
When a disaster strikes, we are urged to send money, and many people do—but is there a better way to fund the relief effort? My guests this week, DFID chief economist Stefan Dercon and CGD senior analyst Theo Talbot, believe that insurance can help.
Depending on who you listen to, the World Bank has either just launched an unprecedented reach into the domestic political affairs of sovereign nations, or it has gutted the rules that have helped define its essential character as a global norm-setter. Both can’t be right, and most likely, neither is. To better understand the objectives of the bank's newly adopted “safeguards” regime, and why I’m somewhat encouraged by it, it’s worth looking more closely at the arguments of critics on both sides.
Aid for countries after a disaster is rooted in our best impulses, but the way we provide it urgently needs to be reformed. We spend too little on reducing the costs of future disasters, aid shows up too late, and calls for reform are met with replies of “too bad” because the poorest people bear the greatest costs. But this is a problem that we can fix.
Financing for humanitarian aid is broken. The costs of rapid- (like cyclones) and slow- (like drought) onset disasters are concentrated in poor, vulnerable countries, with a bill to donors of more than $19 billion last year. But far too often, we wait until crises develop before funding the response—what experts at CGD’s recent panel event (recording available at the link) described as a medieval approach of passing around begging bowls and relying on benefactors. The delays make crises worse. And since money shows up, however imperfectly, when things go wrong, it undermines incentives to build resilience, relegating vulnerable people to depending on fickle goodwill.
Now the Government of India and the World Bank have adopted an approach using principles we describe as Cash on Delivery (COD). The program follows three of these principles by linking payments to outcomes, not inputs; independently verifying outcomes; and allowing recipients to take the lead. India has become the single largest payer for outcomes in a nationwide sanitation initiative.
Challenging global economic conditions, including a combination of low growth, a limited number of jobs, and rising inequality, are fueling the rise of nationalism and populism that are a threat to global cooperation, IMF Managing Director Christine Lagarde said in a speech at CGD.