Paying for Zero: A new global vision for sustainable development

forumblog.org, Mar 7th 2014

When the Millennium Development Goals (MDGs) were first established nearly 15 years ago, the half-joke reminder among global health experts was that they needed to replace the “M” with a “B” when talking about financing – meaning the solutions required budgets in the order of billions rather than millions of dollars. Today, as the MDGs approach their 2015 deadline and the world negotiates a new global vision for sustainable development, the time has come to shift mindsets from “B” to “T”, since the next frontier is talking about trillions of dollars in required investment throughout the global economy.

To that end, members of the Global Agenda Council on Poverty and Sustainable Development have this week released a report distilling key financing challenges to be addressed in establishing a new generation of global development goals. The report, Paying for Zero: Global Development Finance and the Post-2015 Agenda, stresses the crucial complementary roles and opportunities for public, private and “blended” finance at the domestic and international levels. The word “zero” is used to signal a broad theme of transformation for sustainable development: eliminating extreme poverty, eliminating the most pernicious forms of inequality, and eliminating environmentally unsustainable economic activities.

Stressing ongoing generational shifts in the global development landscape, the report argues that ambitious post-2015 goals will require accompanying ambition and innovation in development finance.Watch Full Movie Online Streaming Online and Download

The conclusions tackle a wide range of issues, including:

  • Development finance will increasingly be integrated across types. Flows from public finance will need to leverage additional private finance, and all forms of finance will need to adhere to common standards of transparency, measurement and reporting.
  • As many developing countries continue to make long-term economic gains, the process of graduation from official development assistance (ODA) needs very careful consideration. For example, emerging lower-middle-income countries, especially those with large numbers of extreme poor, should not face a stark drop-off in access to external finance.
  • It is crucial that the international community place special emphasis on protecting and enhancing properly-targeted ODA budgets. These will need to prioritize the poorest countries and programmes that most effectively reduce poverty. But even with complete success in eliminating extreme poverty by 2030, ODA will continue to play a crucial role tackling many deep global priorities through to 2030 and beyond.
  • Improving the capacity of developing countries to mobilize their own resources should be an important element of ODA, without imposing unwanted conditionalities.
  • Greatly enhanced instruments are needed to incentivize the amount and nature of required private finance post-2015. Big ticket investments in infrastructure, energy and agriculture will all require some degree of blending between public and private sources.
  • Many of the infrastructure investments for sustainable development will be the same ones that determine the future of the world’s climate change mitigation and adaptation efforts.

The report’s release coincides with this week’s meetings of both the Intergovernmental Committee of Experts on Sustainable Development Financing and the Open Working Group on Sustainable Development Goals at the UN Headquarters in New York. The Global Agenda Council on Poverty and Sustainable Development brings together a variety of eminent leaders and practitioners from public, private and non-profit sectors around the world.  An earlier draft of the paper was circulated for public comment in January.

Author: John McArthur is a Senior Fellow at the United Nations Foundation and a visiting fellow at the Brookings Institution. He is a World Economic Forum Young Global Leader and chair of the Global Agenda Council on Poverty and Sustainable Development.

Image: People walk past closed shops in a slum in Rio de Janeiro, Brazil, May 23, 2013. REUTERS/Pilar Olivares.

 

How Much Aid for Basic Needs to 2030? Some Very Coarse Numbers

Brookings – Opinion | February 6, 2014

Amidst the growing global consensus around a target of “zero” extreme poverty for 2030, there is renewed debate around the role of official development assistance (ODA) and how much will be required to achieve the goal. The ideal way to assess this question would be through country-specific, bottom-up costing assessments that account for general equilibrium price dynamics and allow for the possibility of shocks, whether positive (e.g., technology) or negative (e.g., conflict or fuel price spikes). In the absence of such rigorous scenario-based analysis, some back-of-the-envelope calculations help inform the approximate orders of magnitude of aid required.

Two conceptually distinct approaches can help inform deliberations on the issue:

  • The first is to estimate the cost of essential services for extremely poor people and the amount of public expenditure required to finance them.
  • The second is to estimate the dollar value of the extreme poverty gap, i.e., the amount of transfers theoretically required to bring each person in the world up to a living standard of $1.25 a day.

1. Essential Services Budget GapWatch movie online The Transporter Refueled (2015)

A budget gap for basic services can be estimated through some simple arithmetic. Assume the following:

(1) A full package of basic public services for health, education, infrastructure, agriculture and public administration costs $200 per capita per year, including roughly $100-140 for Millennium Development Goal-type public investments (in line with the bottom-up estimates of the U.N. Millennium Project, 2005). [Read more…]

Can we slash poverty and starvation by 2015? Yes, if we get to work [op-ed]

Go to the Globe and Mail homepage

JOHN MCARTHUR

Wednesday, September 25, 2013


If global development targets followed a National Football League format, we would be approaching the two-minute warning. December 31, 2015, marks the final deadline for the Millennium Development Goals, the global anti-poverty targets that have mobilized an unprecedented generational success in tackling extreme poverty around the world, most notably the burdens of disease in the poorest countries. We are now facing the final moment to bend the relevant curves of progress. For decision makers, 2013 is the real 2015. [Read more…]

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The Need for a New Canadian Conversation on Foreign Aid

I have a new post at OpenCanada.org, the first of a 3-part series that aims to help kick start a new Canadian conversation around how the country approaches foreign aid over the coming generation.  Please feel encouraged to share comments directly!

New-Conversation

Canada’s foreign aid conversation is lost.  The recently announced merger of CIDA into the Department of Foreign Affairs and International Trade prompted a spate of agitated commentary across the country.  But the public debates underscored the extent to which an institutional tail is wagging the policy dog.  The issues to be resolved are much more fundamental than problems of bureaucratic org charts.  They require systematic and robust thinking, rather than the loose commentary commonly trotted out during moments of sporadic media debate.

Most significantly, there is one central question that needs to be flipped on its head.  Instead of becoming stuck in the supply-driven query, “How should Canada’s foreign aid structures be improved?” the country needs to start with a demand-driven approach, mapping out the nature and scale of the global development challenge, and then asking how Canada can best organize itself to help to tackle the problems at hand.

To that end, this post marks the start of a three-part series.  To help set the stage, below we start by unpacking some of the most common misconceptions around foreign aid.  The second installment provides some historical context for the current debates, and some recent assessments of global need.  The third proposes a way forward, not just for the Canadian government, but for the range of key constituencies that will be essential for moving Canada’s national development strategy forward.

 

[Read more…]

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Is Canada Doing “Its Part and More”?

[This post originally appeared on May 24, 2009 at globalbrief.ca]

This week Canadian Development Minister Beverley Oda made a policy speech outlining Canada’s renewed emphasis on improving the quality of its foreign aid dollars. A focus on efficacy is commendable and important, since taxpayer dollars should of course be subject to strict scrutiny in advancing key development objectives in the poorest countries, particularly the Millennium Development Goals. But an emphasis on quality cannot be presented as a false choice against quantity, since that would distract from many urgent development challenges that need time-sensitive global leadership.

Perhaps most prominently, the rich countries as a group are roughly $35 billion behind on the support they promised for Africa by 2010. Canada is certainly not the worst performer in this regard, since it is generally adhering to its commitment to double aid to Africa, notwithstanding a downward recalculation of the baseline reference numbers. Importantly, the government outlook has been non-partisan on this issue: both Conservatives and Liberals have relied on the talking point that Canada should be praised for maintaining its commitments. As Minister Oda said this week, “Canada has certainly done its part and more” in terms of aid flows.

But what does it mean to do one’s part and more? Amidst the most profound global economic crisis in three generations, is it adequate to rely on commitments from the beginning of the decade as the reference point for the global urgencies of 2009 and 2010? The World Bank recently estimated that this year an additional 55 to 90 million people will be trapped in $1 a day extreme poverty due to the recession, and that the number of chronically hungry will surpass a billion people. At a time like this, when the Global Fund to Fight AIDS, TB, and Malaria is struggling to replenish its budgets and a large number of African countries cannot get funding to help their small farmers access fertilizer, what responsibilities do the most privileged countries like Canada have?film I Am Heath Ledger 2017 online

The real story is that Canada’s commitments are very modest compared to the size of the global problems in disease control, food production, infrastructure, and education that need to be solved. In 2008 Canada allocated 0.32 percent of its national income to foreign assistance, compared to the mean rich country effort of 0.47 percent. This is also well below the amount of support required to achieve the Millennium Development Goals (MDGs) in the poorest countries, which my colleagues and I in the UN Millennium Project estimated at 0.54 percent of national income after a rigorous multi-year study. Simply put, Canada is not yet doing its part even for the MDGs.

Today Canada ranks 16th out of 22 rich countries in its support levels, well behind comparable economies such as the United Kingdom (0.42 percent and rising), the Netherlands (0.80 percent) and Sweden (0.98 percent). The only countries to allocate a smaller share of their prosperity than in Canada last year were Greece (0.20 percent), Italy (0.20), Japan (0.18), New Zealand (0.30), Portugal (0.27) and the United States (0.18).

Even more striking, the OECD projects that Canada will fall even further down the rankings by 2010, the year when it will be the center of global attention as host to both an Olympic Games and a G8 Summit. According to the official statisticians, Canada is projected to rank 20th out of 22 rich countries in terms of its share of income allocated to foreign assistance in 2010. The detailed table is available at http://www.oecd.org/dataoecd/47/56/42458719.pdf. In the absence of new commitments through to 2015, it is difficult to see how Canada could convene the global agenda from a position of extraordinary strength next year.

In my own read, this trajectory is out of step with the underlying preferences of the Canadian public, who overwhelmingly want to play a leadership rather than followership role for the world on global systems and support for the most disadvantaged. I suspect that most of my fellow Canadians, when considering the statistics above, would think that Canada still has much more to do.

** As a footnote, the Minister’s speech (available at http://www.acdi-cida.gc.ca/CIDAWEB/acdicida.nsf/En/NAT-5208469-GYW) included a significant error in citing an alleged failure to get anti-malaria bednets to poor people. In the past this critique was directed at malaria Panik programs at a time when nets were typically sold rather than distributed, and before free mass distribution programs took hold as official global policy. The reality is that over the past three years foreign aid-financed global programs have helped to distributed more than 150 million nets in Africa alone, halfway to the target of universal coverage across the continent by the end of 2010.

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