News Selection – Finance for Sustainable Development
Recent news chosen to update Tread Softly briefings on Finance for Sustainable Development.
USAID launches new private sector engagement policy
13/12/2018: The US Agency for International Development has launched a new private sector engagement policy designed to change the culture and operations of the organization as it works to help countries develop. Source: Devex
Big business capturing UN SDG agenda?
11/12/2018: The UN has increasingly embraced the corporate sector, most recently to raise finance needed to achieve the Sustainable Development Goals. Does this engagement compromise the Goals? Source: Inter Press Service
How can we rate aid donors?
21/11/2018: Two recent assessments of aid donors used radically different approaches – a top down technical assessment of aid quality, and a bottom up survey of aid recipients. The differences between their findings are interesting.
Source: From Poverty to Power
Germany, Netherlands back Niger border force to counter migration
2/11/2018: Germany and the Netherlands have pledged to fund special forces in Niger to control its border and prevent illegal migration. Niger is a transit country for thousands of migrants trying to reach Europe. Source: News24
Tread Softly Comment: This is the trending goal of contemporary foreign aid. Less poverty reduction, infrastructure or governance in the fragile state; more border police to protect Europe. Relevant Briefing: Aid Politics
Time to make aid transparency actionable, says new campaign chief
11/10/2018: The new CEO of a major aid transparency group says the movement needs to change its ways, and make its data more user-friendly to encourage civil society groups to hold donors to account. Source: Devex
African governments’ debt payments double in just two years
8/10/2018: A new briefing shows that the private sector is the largest source of loans to African countries, accounting for 55% of interest payments. Campaigners are calling for more public disclosure of new loans. Source: Jubilee Debt Campaign
Tread Softly Comment: African government debt payments are at their highest level since 2001 and it's clear that the recent rate of increase is unsustainable. This research focuses on challenging the view that Chinese finance is behind the worrying statistics. It concludes that Chinese debt to the African countries listed by the IMF and World Bank as most at risk is no more significant than loans from other sources. Relevant Briefing: Sovereign Debt
‘Surge in financing’ needed to transform the world: UN chief
24/9/2018: A “surge in financing and investments” is needed to achieve the 2030 Agenda, the UN plan of action agreed by Member States, to transform the world, the Secretary-General has said. Source: UN News
China's FOCAC Financial Package for Africa 2018: Four Facts
3/9/2018: The 2018 financial pledges in support of the Forum on China-Africa cooperation reveal that the Chinese state is putting $50 billion of its own money at stake, while encouraging Chinese companies to contribute through investment projects. Source: China Africa Research Initiative
Tread Softly Comment: This brief article is probably the most forensic analysis of the FOCAC 2018 outcome currently available, although it should state more clearly that the figures shown will be spread over three years. The most significant conclusions are that China is not yet contemplating significant debt relief for overstretched economies, and that the amount of aid that would probably qualify as "official development assistance" under OECD guidelines is only $5 billion per annum, less than current US support for sub-Saharan Africa. Relevant Briefing: Aid Statistics
Despite debt woes, Africa still sees China as best bet for financing
31/8/2018: A wave of African nations looking to restructure debt with China on the eve of a major Beijing summit provides a reality check for the continent, where most countries still view Chinese lending as the best bet to develop their economies. Source: The East African
Tread Softly Comment: The three-yearly Forum on China-Africa Co-operation Summit in Beijing this week will update the profile of Chinese investment in Africa. IMF reviews of African economies are increasingly twitchy about debt-to-GDP ratios, largely on account of large-scale Chinese loans. But the infrastructure projects are a necessary stepping stone to development and the lending terms more attractive. The transparency of the event is an unknown factor. Relevant Briefing: Sovereign Debt
German aid minister slams proposed cuts as 'completely incomprehensible'
12/7/2018: The world's second-largest bilateral donor is on track to miss the 0.7 percent aid target as politicians approved a lower-than-expected budget for 2018 and 2019. Source: Devex
Tread Softly Comment: The article doesn't speculate whether this cut in foreign aid was provoked by Trump's bullying of NATO contributors or by the new-found strength of Angela Merkel's right-of-centre coalition partner. Either way, the commitment of the German coalition government to maintain a common trajectory of funds for development and defence has been shredded. The defence budget for 2019 is up 10%, the development budget is heading for a fall. An ominous outcome for the funding resolve of other donor countries. Relevant Briefing: Aid Politics