One proposal in a recent Center for Global Development (CGD) report focuses on restructuring multilateral institutions to better suit developmental needs. A new World Bank funding structure presented at the organization’s most recent replenishment conference aligns with CGD directives.
As more nations climb out of extreme poverty, the capacity in which foreign aid is needed evolves.
Experts stated in the Multilateral Development Banking for This Century’s Development Challenges report that “almost all developing countries now rely primarily on domestic resources to manage public investment.” This evolution renders the foundation of World Bank funding, which has historically relied on capital market failure, incongruous with the reality of global development.
Another issue is that major donor countries have most heavily funded health and education initiatives in the recent past. CGD scholars suggest that countries such as the U.S. redirect foreign aid funds to the development of strategic partnerships with recipient nations.
Such redirection is predicated on a donor country’s willingness to overhaul foreign aid policy.
Perhaps more complicated is the fact that the U.S., once a World Bank powerhouse, is now waning in its contributions to the International Development Association (IDA). This indicates that heavy foreign aid revision in the World Bank’s favor is unlikely. Still, the nation continues to play a monumental role in deciding where IDA funds are spent.
According to Scott Morris and Madeleine Gleave of the CGD, the U.S. is often defensive in its appropriation of aid funds. This strategy has global implications. Policymakers in the U.S. have a history of swaying World Bank investment, avoiding nations like Zimbabwe and Iran for its own interests.
As Morris said in his recent report, “Historically, the United States (and often the U.S. Congress) has exerted its will on issues like these by using the threat of withholding its IDA contributions in any given year.” Three years ago, IDA pledges from donor nations accounted for two-thirds of all World Bank resources. Today, it is estimated that they make up less than half. Threats to withhold become obsolete as such pledges hold less weight.
For that reason, a new World Bank funding structure that deemphasizes public-sector donation in favor of affordable lending and private-sector investment is significant. This new methodology took center stage at the World Bank’s most recent replenishment conference.
Reinvigorated partnerships with the International Finance Corporation (IFC), the Multilateral Investment Guarantee Agency (MIGA) and Multilateral Development Banks (MDBs) are key. Such partnerships would allow the World Bank to leverage IDA funds more holistically. The goal is to lend money to more worthwhile causes in a way that’s free from donor country allegiances.
The next step is to incentivize private investors to contribute to infrastructure ventures, which focus on areas like climate and energy. CGD scholars suggest using MDB resources to decrease risk by bridging gaps between sovereigns and investors. Bridging those gaps could get subsidies and grants to developing nations in a system that does not force borrowers to bear full costs.
Many of these recommendations played into the replenishment, which resulted in some of the most dramatic financial reforms in World Bank history. By combining existing resources with donor funds and the capital debt market, the World Bank hopes to respond to developmental needs with greater agility.
One side effect of this new World Bank funding structure is, as Morris points out, a decrease in influence from countries like the U.S. and U.K. that have dictated spending in the past.
While greater multilateral investment from the world’s wealthiest countries would be ideal, this plan addresses the new reality of global development. The unprecedented move could be just what the developing world needs in a time of transition.
– Madeline Distasio
Photo: Flickr
Toy Inspires Low-Cost Lab Aid to Detect Malaria
Malaria is a life-threatening disease caused by parasites that are transmitted through the bite of an infected mosquito. In 2015 alone, there were 212 million cases of malaria and 429 thousand deaths. Suffice it to say that malaria is a global health problem.
Even worse is that Sub-Saharan Africa continues to carry a disproportionately high share of the global malaria burden. In 2015, the region was home to 90 percent of malaria cases and 92 percent of malaria deaths.
The good thing is that malaria is preventable and curable, given the proper tools to do so. A device called a centrifuge that spins a blood sample very quickly and separates different cells can detect malaria. Centrifuges, though, are expensive, bulky and require electricity – which makes it inefficient in regions such as Sub-Saharan Africa.
A low-cost lab aid to detect malaria is in dire demand, which is exactly what Manu Prakash, a professor of bioengineering at Stanford University, realized on a trip to Uganda. On his trip, Prakash says he found centrifuges used as doorstops because there was no electricity.
Back in California, Prakash experimented with spinning toys in his search for a model for a low-cost lab aid to detect malaria. Though toys are not the conventional approach to developing a lab aid, Prakesh argues that toys hide profound physical phenomena we take for granted.
After experimenting with several spinning toys, including a yo-yo, they stumbled upon the children’s toy known as the whirligig or buzzer. The toy is made of a disk that spins when the strings that go through it are pulled.
This new low-cost lab aid to detect malaria dubbed the paperfuse, can separate pure plasma from whole blood in less than 1.5 minutes, and isolate malaria parasites in 15 minutes. The paperfuse has an ultra-low-cost of fewer than 20 cents, weighs only two grams and is, therefore, field-portable. The paper fuse could be the tool that helps detect and end malaria in low-income countries in the near future.
– Mayan Derhy
Photo: Flickr
Top Diseases in Kazakhstan
Nestled between Russia, China and other regions of the former Soviet Union, lies the nation of Kazakhstan. As is the case in many other middle-income countries, ischemic heart disease and stroke are the leading causes of death. However, cirrhosis of the liver has overtaken chronic obstructive pulmonary disease (COPD) as one of the top diseases in Kazakhstan. Together, the top diseases in Kazakhstan claim the lives of approximately 85,000 individuals annually.
Ischemic Heart Disease
Often referred to as Coronary Artery Disease (CAD), Ischemic Heart Disease is a condition characterized by insufficient blood flow to the heart. CAD develops when plaque composed of cholesterol and other substances accumulates in blood vessels. As in much of the developed world, the increasing incidence of heart disease in Kazakhstan is correlated with increased body mass index (BMI). More than half the population is overweight. The most common symptom associated with ischemic heart disease is angina or chest pain. Eventually, CAD can lead to heart attacks, heart failure, or arrhythmia.
Cardiovascular Disease is associated with significant direct (e.g. medical) and indirect (e.g. lost productivity) costs. The good news is, there are simple but effective interventions that can reduce the burden of this disease. One study demonstrated a 460% return on investment for community-based initiatives that promoted better lifestyle choices, such as increased physical activity, smoking cessation and healthy eating.
Stroke
Like ischemic heart disease, stroke is a condition with numerous modifiable risk factors. Most strokes occur when there is insufficient blood flow to the brain. About 20% of strokes are hemorrhagic (due to bleeding). Strokes can result in serious neurological damage and is a leading cause of long-term disability. Community empowerment and education initiatives can help the incidences and severity of strokes. The lifestyle modifications that mitigate the effects of coronary artery disease are also effective in reducing the risk of stroke. In Kazakhstan, sodium intake is one of the most obvious targets for intervention. The average Kazakh consumes over 6,000 mg of sodium daily or three times the maximum recommended by WHO. In addition, limiting alcohol consumption to one drink for women and two for men per day can help lower stroke risk.
Cirrhosis
Reducing alcoholism in Kazakhstan has proven difficult as evidenced by the increasing prevalence of Cirrhosis. Cirrhosis, or end-stage liver disease, is most commonly caused by hepatitis B or C and alcoholism. According to WHO, the average Kazakh over 15 years of age consumes 10.3 liters of pure alcohol, more than in any other Central Asian country. Since the harmful use of alcohol is also tied to socioeconomic development, organized efforts should be targeted toward this problem. Over time, the incidence of liver Cirrhosis would decrease. There would also be the immediate benefit of reduced motor vehicle accidents, due to intoxication.
In many parts of the world, the leading causes of death have shifted from being acute and communicable to being chronic and noncommunicable. Through medical innovations and effective public policy, those former causes of morbidity and mortality have been dramatically reduced. Sustained passion for social change could also help overcome health problems that now plague the modern world.
– Rebecca Yu
Photo: Flickr
Industrial Parks in Ethiopia: Constructing Seventeen Objects
The African country Ethiopia, one of the world’s oldest civilizations, is also one of the world’s poorest countries. On top of that, the nation suffered its most sluggish period of growth in 2015 due to ongoing social unrest and a devastating drought. And so, to enable the nation to become a middle-income country by 2025, an ambitious plan has been set to construct 17 agro-industrial parks in Ethiopia.
The main challenges for Ethiopia are sustaining the economic growth it achieved and accelerating poverty reduction, which can best be done by creating more jobs and therefore expanding the work sector. The industrial parks in Ethiopia plan to do just that. The parks are a part of the second phase of the government’s Growth and Transformation Plan (GTP II), which will run from the 2015/16 year until 2019/20.
In the first year of GTP II, the government constructed two parks, both of which have created a much-needed influx of jobs. The first, Bole Lemi I Industrial Park, has created over 11,000 job opportunities and has exported products that have a value of 20 million USD. The other, Hawassa Industrial Park, also created jobs for over 60,000 citizens and is expected to export products valued at one billion USD per year. The government is expected to build an additional three parks in Mekele, Combolcha and Adama this fiscal year.
Industrial parks are known to have a great role in expanding a region’s manufacturing sector and tapping into their local talent. The idea to develop industrial parks in Ethiopia was modeled after those in Asia and Eastern Asian countries such as China, South Korea, Singapore, Malaysia and Vietnam.
The hope is for the parks to create an influx of jobs for the youth in Ethiopia as they did in other countries, which is an objective of utmost importance in GTP II. Luckily, among the total job opportunities created in the parks, 85% are covered by women and youth, and disabled citizens also have an opportunity to find work. By the time the parks are completed, Ethiopia’s working class will include the full range of the population.
These 17 agro-industrial parks in Ethiopia could be the first step to promoting investment, tapping into the country’s potential and laying the groundwork for a sustainable economy.
– Mayan Derhy
Photo: Flickr
French Aid to Ease Poverty in Martinique
Martinique is a small island in the Lesser Antilles of the Caribbean. This insular region of France has a population of 385,551. The official language is French, but the local Antillean Creole dialect is still widely spoken. Despite Martinique’s Human Development Index (HDI) of 0.946, which is the 24th highest HDI in the world according to the United Nations, the country has fallen victim to a series of economic and environmental misfortunes in recent years.
Partly to blame for the rise in poverty in Martinique is the global drop in fuel prices from 2008 to the present. Martinique’s petroleum drilling and refining infrastructures have been unable to keep up with the global market price. Martinique’s petroleum export value has suffered an unprecedented drop from 28% to minus 7% profitability between 2014 and 2015, putting a major burden on their economy.
Another problem facing Martinique and neighboring islands like Guadeloupe is the pollution of Chlordecone, an endocrine-disrupting pesticide that was used on banana farms in the Basse-Terre area of Guadeloupe which lies 105 miles north of Fort-de-France, Martinique’s capital city. “The chlordecone is trapped in the mud on the estuary and is released every time there’s a storm. It will go on for generations,” says Nicolas Diaz, a biologist working for Guadeloupe regional council.
France gave $33 million between 2008 and 2010 to access the scope of the pollution, and conduct research. Scientists of the report concluded that the pesticide has entered into many aspects of Martinique’s food and drinking supply, as well as the environment; introducing a lot of serious health problems onto the island, including a rise in prostate cancer. The poor are the ones that are affected most by chlordecone pollution. “About 80,000 people live in areas where the soil is contaminated and 13,000 absorb more chlordecone than the reference dose per day, simply by eating their own vegetables,” according to professor William Dab, head of the Science Committee for the Martinique and Guadeloupe Chlordecone Plan.
Fishermen have also taken a toll from the pollution as the local lobster and fish populations contain unsafe levels of the pesticide. In response, French overseas minister to Martinique, Victorin Lorel, a native of Guadeloupe, has been instrumental in advocating for a $2.66 million aid package to Martinique’s fishermen to ease the industry loss now and into the future. Lorel also has promised a new “ambitious plan” for fisheries in France’s lesser Antilles overseas departments.
The European Union, as a part of its goal to bring all EU members up to Europe 2020 targets for smart, sustainable, and inclusive growth has allocated €520,951,695 between 2014-2020 to Martinique. The aim is to rebuild infrastructure, increase renewable energy production, improve the skills of the impoverished population and generally raise the quality of life, by lowering poverty.
In addition to the incredible contributions from the EU and the French government, there has been a large effort in France to provide humanitarian aid to help with poverty in Martinique. There are numerous organizations that are involved in providing human services/sending volunteers to the satellite territory, as well as setting up food drives and clothing drives to try to lower risks of poverty in Martinique. It is encouraging to see different entities join together to provide this French outer department hope for their future.
– Joshua Ward
Photo: Flickr
Why Foreign Aid is Hurting Africa? It’s Not
Why is foreign aid hurting Africa? Is foreign aid hurting Africa? Relax it’s not. While there are certainly examples of aid done right and aid done wrong, the reality is when done correctly (which it usually is) aid is extremely effective.
Why do people say aid is hurting Africa? Let’s be honest, it bothers us to see human suffering and we feel guilty that we’re not doing something about it. In the end, we’re more than happy to buy into an excuse to do nothing. You’ll see this play out in every country. Talk to the “have’s” in any country and they’ll usually tell you why the “have not’s” can’t be helped. Regardless of whether you visit South Africa or India, as an outsider it’s usually quite disturbing hearing a person driving a Mercedes explain to you why the starving child living on the streets outside his mansion can’t be helped. In our never-ending pursuit to be at peace with ourselves, it’s far easier to maintain our lifestyle and buy into doing nothing is better than something.
Four of the ten fastest-growing economies are African countries that have received foreign aid.
Annual average GDP growth % (2014-2017)
(Business Insider)
Good News in the War on Poverty
In 2015 The United Nations completed The Millennium Development Goals which began in 1990. Over that period, remarkable results have been achieved.
(USAID)
Food Crisis in Venezuela: Starvation, Corruption and Exodus
As the food crisis in Venezuela continues to worsen, the country is suffering from issues ranging from starvation to corruption and mass migration to surrounding countries.
Venezuelans lack access to common goods ranging from food to medicine. The country has triple-digit inflation and the currency collapsed nearly 80 percent last year, leading to millions of citizens suffering from food insecurity. Food riots caused violence and even death in several Venezuelan cities last year, and Venezuelan President Nicolás Maduro has responded by attempting to control the increasingly black market distribution of food and goods within the country. The government hopes that by placing limits on how much individuals can buy at a time, it will be able to put an end to the black market operation of buying and reselling food for higher prices.
As children and families suffer from starvation in the country, many parents are attempting to give their children to families who will be able to provide food for them. Reuters reports that at a social services center in Carirubana more than a dozen parents seek help providing care for their children each day. This is a dramatic uptick from last year when the center averaged one parent per day.
A survey released by a children’s rights group reported that two-thirds of 1,099 households with children were not eating enough in the region of Caracas, Venezuela. The average wages in the country are the equivalent of $50 per month. This has created a desperate situation where parents fear that their children will be forced into prostitution or the drug trade in order to survive.
As the food crisis in Venezuela grows increasingly desperate, food trafficking has become one of the largest businesses in the country. The military controls the distribution of food, and documents and interviews reveal that corruption runs rampant at every level from generals to soldiers.
Tens of thousands of Venezuelans cross the borders into Brazil and Columbia each month, some to buy food and return home and others to find a permanent home in a country where food is more readily available. Along border towns, Venezuelans account for 60 percent of all hospital visits, and as more Venezuelan sex workers arrive, the rates of sexually transmitted diseases have skyrocketed in these regions.
As the food crisis in Venezuela continues, it is important that the international community condemns human rights violations and corruption in the country. It is important that global powers like the United States focus on helping partner countries in South America put pressure on the Venezuelan government to promote democracy and end corruption and food insecurity.
– Eva Kennedy
Photo: Flickr
Five Efforts to Fight Hunger in Spain
Shaken up by the global economic crisis and with one of the highest unemployment rates in Europe, Spain has many vulnerable people struggling with poverty and hunger. Fortunately, numerous efforts in the towns of Galdakao, El Prat and toward the nation as a whole have helped significantly in the fight against hunger in Spain.
Despite the recent financial struggles and the growing problem of hunger in Spain, the country has found various methods to improve conditions for health and nutrition for its citizens.
– Mikaela Frigillana
Photo: Flickr
New Insurgency in Myanmar: Examining What Is an Insurgency
There has been an uptick in an insurgent group activity in Myanmar the past few months. A new insurgency group within the Rohingya community named Harakah al-Yaqin has been carrying out attacks in the Rakhine state. This is a small yet important economic area within Myanmar that has a large Muslim population located within a country that is mainly Buddhist.
According to a Stratfor report, the Rohingya have long been a marginalized group in Myanmar society. They are not granted full citizenship and are accused of not being Myanmar at all, but rather recent Bengali immigrants.
The group demands are more ethnic-based rather than being steeped in political Islam. They are asking for government recognition as citizens and equal rights, but with no mention of Sharia law which differentiates them from other Islamist insurgencies. The scope of what is an insurgency depends on what the goal of that group ends up being.
With insurgencies varying from movement to movement, it is important to determine what is an insurgency. A recent paper by Aaron Young & David Gray seeking to define the term looks at likely causes and examines possible solutions. They believe that an insurgency is bound to political constraints. They define what is an insurgency by the challenging of these political aspects:
They believe that terrorism is only an option utilized by insurgencies if they fail on achieving their political goals. Over the years, though, the inclusion of guerilla warfare and terrorist tactics have served the purpose of demoralizing their opposition which can sometimes equate to an accelerated victory of their political goals.
Gray reports that “through proper management of social services and welfare programs, the needs of insurgent masses can be met. Only by the willingness of cooperation by the state and insurgent forces can a unified agreement be reached, considering that is a goal of the organization.”
Economic factors are important to squash an insurgency according to Mr. Gray. His research has led him to believe that by including indigenous and minority groups into economic development instead of complete control by the ruling party can be key to defeating the underlying current of an insurgency. And that the only way an insurgency can continue is if economic conditions remain the same or worsen. He states “by increasing regional utilization and production of viable resources, unemployment reductions, giving the masses both a sense of control of their own destinies and increases in the distribution of wealth has the effect of reducing strife and discontent.”
The Myanmar government reportedly has very little interest in including the Rohingya population into future economic growth. There are politically motivated fears that any softening towards the Muslim population may lead to a change in power facilitated by an angry Buddhist majority electorate. Young & Gray would argue the exact opposite approach to ending the unrest currently occurring in Myanmar.
– Brian Faust
Photo: Flickr
Mexico’s Oportunidades Program
Although parents in Mexico generally are aware of the long-term benefits of education, they sometimes pull their children out of school and send them to work. This is indicative of the vicious intergenerational cycle of poverty that afflicts many Mexican families.
The goal of the Oportunidades Program — Mexico’s primary anti-poverty program — is to put an end to this cycle by improving the health and education of the children. It represents 46.5% of the country’s federal annual anti-poverty budget and has so far benefitted 6 million people since its beginning in 1997.
The program conditionally supplements the families’ incomes and provides monetary educational grants so that parents can afford to send their children to school. Families are chosen by socio-economic evaluation and payments are given to the female head of the family.
The chief components of the program are as follows:
Up to a third of the decrease in poverty in rural areas can be attributed to the Oportunidades Program, according to a 2014 world bank report. The International Food Policy Research Institute (IFPRI) also evaluated the program’s effectiveness and found that after three years, children in rural areas have increased their school enrollment, have improved diets and have received better medical attention.
Recently the Oportunidades Program, now called Prospera, has spread to urban areas and extended high school education grants. The program has also been successfully replicated in 52 countries in Latin America, Asia and Africa.
Oportunidades’ resounding success proves that conditional cash transfer programs, even on a large scale, do in fact reduce poverty and prepare the country for long-term economic growth. This investment in human capital — primarily the children’s well-being and education — is an exemplary way to not only reduce poverty but eliminate it.
– Liliana Rehorn
Photo: Flickr
New World Bank Funding: Implications for U.S. Influence
One proposal in a recent Center for Global Development (CGD) report focuses on restructuring multilateral institutions to better suit developmental needs. A new World Bank funding structure presented at the organization’s most recent replenishment conference aligns with CGD directives.
As more nations climb out of extreme poverty, the capacity in which foreign aid is needed evolves.
Experts stated in the Multilateral Development Banking for This Century’s Development Challenges report that “almost all developing countries now rely primarily on domestic resources to manage public investment.” This evolution renders the foundation of World Bank funding, which has historically relied on capital market failure, incongruous with the reality of global development.
Another issue is that major donor countries have most heavily funded health and education initiatives in the recent past. CGD scholars suggest that countries such as the U.S. redirect foreign aid funds to the development of strategic partnerships with recipient nations.
Such redirection is predicated on a donor country’s willingness to overhaul foreign aid policy.
Perhaps more complicated is the fact that the U.S., once a World Bank powerhouse, is now waning in its contributions to the International Development Association (IDA). This indicates that heavy foreign aid revision in the World Bank’s favor is unlikely. Still, the nation continues to play a monumental role in deciding where IDA funds are spent.
According to Scott Morris and Madeleine Gleave of the CGD, the U.S. is often defensive in its appropriation of aid funds. This strategy has global implications. Policymakers in the U.S. have a history of swaying World Bank investment, avoiding nations like Zimbabwe and Iran for its own interests.
As Morris said in his recent report, “Historically, the United States (and often the U.S. Congress) has exerted its will on issues like these by using the threat of withholding its IDA contributions in any given year.” Three years ago, IDA pledges from donor nations accounted for two-thirds of all World Bank resources. Today, it is estimated that they make up less than half. Threats to withhold become obsolete as such pledges hold less weight.
For that reason, a new World Bank funding structure that deemphasizes public-sector donation in favor of affordable lending and private-sector investment is significant. This new methodology took center stage at the World Bank’s most recent replenishment conference.
Reinvigorated partnerships with the International Finance Corporation (IFC), the Multilateral Investment Guarantee Agency (MIGA) and Multilateral Development Banks (MDBs) are key. Such partnerships would allow the World Bank to leverage IDA funds more holistically. The goal is to lend money to more worthwhile causes in a way that’s free from donor country allegiances.
The next step is to incentivize private investors to contribute to infrastructure ventures, which focus on areas like climate and energy. CGD scholars suggest using MDB resources to decrease risk by bridging gaps between sovereigns and investors. Bridging those gaps could get subsidies and grants to developing nations in a system that does not force borrowers to bear full costs.
Many of these recommendations played into the replenishment, which resulted in some of the most dramatic financial reforms in World Bank history. By combining existing resources with donor funds and the capital debt market, the World Bank hopes to respond to developmental needs with greater agility.
One side effect of this new World Bank funding structure is, as Morris points out, a decrease in influence from countries like the U.S. and U.K. that have dictated spending in the past.
While greater multilateral investment from the world’s wealthiest countries would be ideal, this plan addresses the new reality of global development. The unprecedented move could be just what the developing world needs in a time of transition.
– Madeline Distasio
Photo: Flickr