As the possibility of a new Cold War between the US and China gains traction in some foreign policy circles, the scale of Chinese development finance has taken center stage. A closer examination suggests the cost to China of this lending is distinctly underwhelming. It would be cheap for the US and Europe to match China’s lending numbers –and in the interest of global development if it was done right.
CGD Policy Blogs
We need to move forward—or backward—in what we expect development finance institutions (DFIs) to do in terms of financing private sector development in the world’s poorest countries.
The new US International Development Finance Corporation (DFC), the successor to the Overseas Private Investment Corporation, will be a major player in global development finance.
A Key Question If You Are Reviewing Multilateral Organization Effectiveness: Do We Need a Multilateral Solution?
There’s increasing appetite in the US to follow the UK model and launch a review of US spending through international organizations like the United Nations and the World Bank. There is a lot to be said for such an exercise—my colleague Todd Moss even carried out a mock version for the US a few years ago which suggested plaudits for Gavi and the African Development Fund alongside brickbats for the ILO and UNESCO. But I think the model has a serious weakness if it is going to be applied as broadly in the US as some proposals, including a draft executive order making the rounds, imply. I’d argue for (preferably) limiting the review to like-to-like comparisons covering aid and development institutions or (at least) using different criteria for judging the many different types of international organizations.