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Reality is not yet matching rhetoric in moving from “billions to trillions” to finance the SDGs—how can we accelerate sustainable development finance?
To meet the Sustainable Development Goals (SDGs), the world must ramp up development financing from billions to trillions of dollars. The COVID-19 pandemic has increased the financing needs and made them more complex. We must think beyond aid, to private finance, and unlocking developing countries’ own resources. The roles of financiers and developing country partners in mobilizing and allocating aid needs to change so that the international community can focus not only on country-by-country development, but also on pressing shared problems, such as climate change, global health and international migration. Financing must encourage a resilient and sustainable future.
At the same time that the world is looking to scale up development financing, the development financing system is becoming more complex. There are new donors, like China and India, with different development paradigms. And the emergence of new multilateral development agencies and national development banks add resources to the mix but raise the question of whether new models of international cooperation are needed to maximize the leverage of scarce financing.
Our research focuses on five questions: How can the international financial system produce sufficient funding for recovery and sustainable development? How should it be allocated to help countries rebuild their economies, meet the SDGs and confront global challenges? How can financing most effectively mobilize private capital, safeguard public monies, and keep debt levels sustainable? How can domestic resources be mobilized within developing countries? And how should existing institutions be changed to best cooperate?
This paper reviews research on the impact of rice prices on the poor, on real wages in rural and urban areas, and on the broader macroeconomic consequences for investments in labor-intensive manufacturing.
This paper argues that regional public goods in developing countries are under-funded despite their potentially high rates of return compared to traditional country-focused investments. In Africa the under-funding of regional public goods is primarily a political and institutional challenge to be met by the countries in this region. But the donor community ought to consider the opportunity cost – for development progress itself, in Africa and elsewhere – of its relative neglect, and explore changes in the aid architecture that would encourage more attention to regional goods.
Paradoxically, in most successfully developing countries, especially those in the rice-based economies of Asia, the public provision of food security quickly slips from its essential role as an economic stimulus into a political response to the pressures of rapid structural transformation, thereby becoming a drag on economic efficiency. The long-run relationship between food security and economic growth thus tends to switch from positive to negative over the course of development. Because of inevitable inertia in the design and implementation of public policy, this switch presents a serious challenge to the design of an appropriate food policy.
In the face of continuing development challenges in the world's poorest countries, there have been new calls throughout the donor community to increase the volume of development aid. Equal attention is needed to reform of the aid business itself, that is, the practices and processes and procedures and politics of aid. This paper sets out the shortcomings of that business on which new research has recently shed light, but which have not been adequately or explicitly incorporated into the donor community's reform agenda. It outlines seven of the worst "sins" or failings of donors, including impatience with institution building, collusion and coordination failures, failure to evaluate the results of their support, and financing that is volatile and unpredictable. It suggests possible short-term practical fixes and notes the need ultimately for more ambitious and structural changes in the overall aid architecture.
This paper considers what role pull instruments or challenge programs (such as the World Bank's Poverty Reduction Support Credits or the United States' Millennium Challenge Account) could play within the overall framework of foreign aid, asking how they could be designed to function as effective and efficient incentive instruments and how they could best complement other aid modalities.
Primary health care is accepted as the model for delivering basic health care to low income populations in developing countries. Using El Salvador as a case study, the paper draws on three data sets and a qualitative survey to assess health care access and utilization across public and private sector options (including NGOs).
This paper ties together the macroeconomic and microeconomic evidence on the competitiveness of African manufacturing sectors. The conceptual framework is based on the newer theories that see the evolution of comparative advantage as influenced by the business climate—a key public good—and by external economies between clusters of firms entering in related sectors. Macroeconomic data from purchasing power parity (PPP), though imprecisely measured, estimates confirms that Africa is high-cost relative to its levels of income and productivity. This finding is compared with firm-level evidence from surveys undertaken for Investment Climate Assessments in 2000-2004.
After more than a decade of financial sector liberalization, both of domestic markets and of international financial transactions (capital account liberalization), policymakers in many developing countries remain concerned about the effects that large and highly volatile capital flows have on their financial systems. However, in spite of the tremendous costs associated with the resolution of crises and signs of discontent among the population with the outcome of some reforms, to date there is no significant evidence indicating a reversal of the reform process. While one could advance a number of hypotheses explaining this "commitment to reforms," developing countries’ decisions and actions seem to indicate that policymakers perceive capital inflows as a necessary component to achieve growth and development.