Category Archives: Foreign aid
What the World Bank Does Not Understand About “Doing Business”
In its 10-year history, the World Bank’s Doing Business Report has achieved enormous influence. The annual study, one of the flagship knowledge products of the World Bank, is the leading tool to judge the business environments of developing countries, generating huge coverage in the media every year. Several countries—such as Rwanda—have used it as a guide to design reform programs. For its part, the Bank has advised over 80 countries on reforms to regulations measured in the DB. Its influence stretches even to academia, with over 1,000 articles being published in peer-reviewed journals using data in the index.
But does it focus on the most important issues for companies in less developed countries?
Based on my own almost 20 years of experience doing business in places such as Nigeria, Turkey, and China, the answer is no. (more…)
More on Economic Development, Foreign aid, Governance, Policies
What the OECD Does Not Understand About Fragile States
The Organisation for Economic Co-operation and Development (OECD) Development Assistance Committee (DAC) and its International Network on Conflict and Fragility (INCAF) do an admirable job bringing together policymakers, collecting and synthesizing information, and helping set the agenda for donors.
But, as exemplified by Emmanuel Letouzé’s (lead author) and Juana de Catheu (co-author)’s recent report Fragile States 2013: Resource Flows and Trends in a Shifting World, its analysis of fragile states is flawed in a couple of important ways.
My major complaints are: (more…)
More on Foreign aid, Fragile States, Identity, Policies, Review
A Multidimensional Approach to Resolving Conflict: The Eastern DRC
Problems that have been intractable for decades are very likely the product of many different issues that intertwine with each other in a way that makes attempts to fix things highly problematic. Simple solutions — changing a person, introducing a reform, holding an election, penalizing one party — rarely work.
Conflict, weak governance, state failure, economic backwardness — all have many causes and many issues that must be dealt with. There are no magic bullets, no easy remedies, no quick strategies.
The eastern Congo is representative. Depending on who you listen to, the ongoing violence is caused by either a weak state, grievances over land and identity, greedy local elites, or international business. Some say the root cause is local, another group says it is national, and a third group defines the problem as regional. In fact, all these interpretations are correct — to some degree. Interests, actors, and causes are intertwined in a complex web. It is hard to say where one factor stops playing a role and another starts. (more…)
More on Africa, Conflict and Security, Foreign aid, Governance
Are Fragile States Really Failing to Meet the MDGs?
By Paul Harvey, Secure Livelihoods Research Consortium
Almost whenever you read anything about fragile states, the introduction notes that, ‘no low-income fragile or conflict-affected country has yet to achieve a single United Nations Millennium Development Goal’. This is a quote from the overview from the 2011 World Development Report on conflict, security and development. It seems to be an elaboration of a quote from the main body of the report that is subtly but importantly different. ‘No low-income, fragile state has achieved a single MDG, and few are expected to meet targets by 2015.’ (more…)
Is the Development Community’s Focus on Fighting Poverty Passé
Fighting poverty is the most important issue to the development community. It stirs passions, brings in the money, attracts the most attention—and thus sits at the top of everyone’s agenda.
When the new head of the World Bank, Dr. Jim Yong Kim, engages the wider public, he asks, “What Will It Take to End Poverty?” When the prime minister of the United Kingdom touts his accomplishments in the development field, he writes about “Combating Poverty at Its Roots.” And when NGOs fundraise, they stir your heart by telling you, “Sponsoring a child is the most powerful way you can fight poverty.”
But given great reductions in absolute poverty (from 55 to 22 percent of the developing world’s population over the past three decades) and great improvements in the lives of the poor, is this focus on poverty reduction detracting from more important issues? (more…)
More on Economic Development, Foreign aid, Governance, Poverty
Development: Solving Collective Action Problems
There has been a lot of deep thinking about development problems over the past decade or so. But for the most part, a better understanding about how countries progress has not translated into dramatic changes in the activities aimed at promoting it.
International development agencies now say they emphasize politics and seek to find “best fit” solutions tailored to individual country circumstances. However, as David Booth writes in a recent Africa Politics and Power Policy Brief,
Much of the newer governance programming looks much like the old kind. Even the most reflective country activists and the best governance advisers have trouble imagining what to do differently.
Improving governance in developing countries in Africa and beyond requires that international actors undertake much greater reforms in how they operate than has been contemplated up to now. Many of the assumptions about development need to be challenged and overturned. (more…)
More on Africa, Economic Development, Foreign aid, Governance, Review
Social Exclusion Case Study: Pakistan
Pakistan is arguably the world’s most important fragile state, but many of its problems are not well understood. Security problems dominate headlines, but the country’s real troubles more often than not float beneath the surface unknown even to those trying to help the country.
A good example of this is the issue of social exclusion. Although it receives almost no attention internationally, social exclusion—in its various forms—plays a major role in the country’s problems. By systematically disadvantaging large portions of its population, Pakistan’s elites reduce the legitimacy of the state, encourage extremism against it, weaken the impetus to enhance public services, and contribute to long-term demographic and environmental threats.
Horizontal social exclusion is one of the two most important drivers (with weak government) of state fragility worldwide, yet rarely receives the attention it deserves in international discussions of fragile states. Whereas vertical inequity between individuals plays a major role in debates on development, horizontal inequity between groups is often not even measured.
A recent Norwegian Peacebuilding Resource Center (NOREF) Policy Brief on social exclusion in Pakistan is therefore a very welcome addition to the literature on the country. By outlining the country’s main axes of social exclusion and how they affect stability and governance, it does a great service to anyone working on the country. I strongly recommend the analysis part of the paper both as a backgrounder for those working on Pakistan and as a case study for how social exclusion affects fragile states in general. (more…)
More on Economic Development, Foreign aid, Governance, Identity, Review, South Asia
Can Foreign Aid Improve Pakistan’s Political Economy?
Like many struggling countries, Pakistan’s two most critical problems are feckless leaders and a feeble state. Can donors do anything to help get such countries’ political economy moving in the right direction?
I recently convened a working group of leading Pakistani development professionals and outside experts at the Global Economic Symposium (GES) to discuss just such this question.
The group’s conclusions are summarized in this report. (more…)
More on Foreign aid, Governance, Politics, South Asia
Where are the Development Political Scientists?
Economists dominate the development field, but politics is more important to promoting it. This contradiction explains why the policies often recommended by international institutions (such as the World Bank) do not sufficiently take into account the local political, social, and institutional context.
The problem is echoed in other fields, with some blaming the inability of economists to understand institutions and politics a contributing factor to the 2008 financial crisis.
Economists were not always this ignorant. Thinkers such as Adam Smith and David Ricardo—known today as founders of the profession—considered themselves “political economists;” they never used the term “economics” by itself. The term didn’t stand by itself until the late 19th century when it was separated into a stand-alone discipline. (more…)
More on Foreign aid, Governance, Politics
How Far do Perception Surveys Take Us in Fragile and Conflict-Affected Situations?
By Richard Mallett, Overseas Development Institute
Although we may not always agree on the specifics – or the application of the concept given its political sensitivities – there is a degree of consensus on the general traits of state fragility. These include, for example, weak capacity to provide basic services, public security and rule of law; inability to manage political conflict; and delegitimization of the state. But this year’s Global Monitoring Report, produced by the World Bank and the International Monetary Fund, threw a new trait into the mix. “Fragile states,” it argued, are characterized by, among other things, a “lack of timely and reliable statistics on the basis of which policies can be formulated.” (more…)
More on Conflict and Security, Foreign aid, Fragile States, Poverty
