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1841. Financing the Economic Stabilization and Growth Programme (Zambia Plus) in the Shadow of the IMF

Author:
Caesar Cheelo
Publication Date:
04-2018
Content Type:
Working Paper
Institution:
Hudson Institute
Abstract:
In February 2018, the IMF reaffirmed its August 2017 formal withdrawal from negotiations with Zambia over a package of financial support. The strong position to hold negotiations came in the IMF’s Article IV Consultations report of 2017, which concluded that Zambia was at high risk of debt distress, and that whilst financial management and fiscal discipline were improving, the extent of the improvement was not sufficient to mitigate the growing public debt and fiscal deficit. Whilst the IMF deal may be off the table for the time being, the many of problems that drove Zambia to engage the IMF most assuredly remain unresolved. Two to three years after the economic minicrisis of 2015, Zambia continued to accrue sizable new debts, to utilize the proceeds poorly (to fund consumption spending) and to run persistent fiscal deficits – albeit a smaller and seemingly better managed deficit in 2017 compared to 2015 and 2016. These issues remain problematic despite the partial economic rebound, with high copper prices, good rains (leading to good harvests and more reliable power supply), and a stable Kwacha providing a strong platform for improvement. Nonetheless, fiscal performance is lagging behind and Zambia may be missing a window to reestablish prudent public financial management.
Topic:
Infrastructure, Governance, Reform, Macroeconomics, IMF, and Public Debt
Political Geography:
Africa and Zambia

1842. Global and Local Challenges in Argentina and Brazil

Author:
Guillermo Calvo
Publication Date:
12-2018
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
The last presidential elections in Argentina (2015) and in Brazil (2018), represent a change from populism towards more orthodox economic policies in two important countries in the region. This shift is not only economic but also reflects other fundamental changes in the electorate, in particular the growing dissatisfaction of the population with issues such as weak security and growing corruption in political institutions. In both countries, there are significant fiscal problems and adjustment is needed. But in modern democracies, the success or failure of economic policy is closely tied to political developments. Notably, both countries face their macroeconomic challenges under a parliamentary minority; a situation that is common to many countries in the region at present. Economies highly integrated into the international capital markets, with macroeconomic imbalances inherited from populist governments, face a particularly difficult challenge. On the one hand, the required fiscal tightening entails the execution of policies that may result in greater social unrest, thus encouraging a gradual approach. On the other hand, a gradual approach requires a greater funding stream of financial funds thus exposing the economy to higher financial risk. The dilemma of choosing between a shock adjustment and a gradual approach has been central to understanding what has happened in Argentina and is essential to assessing the options available to the next government in Brazil. The dilemma about the optimal speed of fiscal adjustment has been faced by other countries in the region in the past. In some successful cases of gradualism, the presence of a clear commitment mechanism over the fiscal path, including the implementation of goals agreed with the IMF, has played a decisive role in mitigating the credibility gap typically linked to gradual approaches. One question that the Committee puts forward throughout this statement is to what extent does Argentina's experience entail relevant lessons for Brazil? In order to thoroughly understand these possible lessons and the challenges that both countries face, it is important to consider the similarities and differences between Argentina and Brazil. There is no doubt that both countries are dealing with formidable fiscal challenges. In both countries, there is a primary fiscal deficit and public debt levels are high in relation to GDP. Also, both economies face low or negative growth rates, partly because of cyclical or temporary factors and partly because of low productivity levels due to complex regulatory regimes and tax systems that hinder investment. On the other hand, the realities of Argentina and Brazil are very different in some important aspects. Brazil has not had to cope with a currency crisis and external financing problems such as those of Argentina; the latter has had to reduce its hefty deficit in the current account of the balance of payments. In contrast, Brazil’s external public debt and external financing needs of the public sector are low. However, while the private sector’s foreign indebtedness is quite moderate in Argentina, it is relatively high in the case of Brazil. As regards to monetary policy and inflation, the situation in both countries is also very different. Whereas the inflation rate in Argentina has suffered a substantial increase throughout this year in the context of low credibility in its monetary policy, Brazil has kept a low and stable inflation rate and has significantly improved its central bank’s credibility. These similarities and differences require a differentiated discussion of each country, even if some challenges facing Argentina and Brazil are shared, and whether their experiences provide lessons for each other. The international context plays a fundamental role for both economies in determining the results of economic policy. Before embarking on a more detailed analysis of the challenges facing Argentina and Brazil during the next year, we will analyze how the international context has recently changed, in the next section.
Topic:
Economics, Globalization, Populism, and Local
Political Geography:
Brazil, Argentina, and South America

1843. Development Impact Bonds Targeting Health Outcomes

Author:
Lorcan Clarke, Kalipso Chalkidou, and Cassandra Nemzoff
Publication Date:
12-2018
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
As of December 2018, seven development impact bonds (DIBs) have been launched across seven countries with nearly US$55million in cumulative outcome funding. DIBs fund public services through contracts where private investors provide upfront flexible funding to service providers and outcome funders repay these investors based on the outcomes achieved by people receiving services. Three DIBs specifically target health outcomes: the Humanitarian Impact Bond, the Utkrisht Impact Bond, and the Cameroon Cataract Bond. The three “health DIBs” involve US$26.5 million in upfront investment, US$38.1 million in outcome funding and aim to impact the health of at least 31,600 people. Using publicly available information, we describe all seven DIBs, and evaluate the three “health DIBs” in more detail, comparing their stakeholders, implementation, and outcome structures. Building on a scoping review of relevant literature, we outline health DIBs in the pipeline and note that the potential of DIBs as a funding structure is hindered by the lack of publicly available information on their estimated impact and value for money. We offer three recommendations to improve evaluation and inform development of DIBs in the future: (1) publish plans and evaluations, (2) create and use consistent reporting guidelines, and (3) allocate funding to evaluate impact and value for money.
Topic:
Development, Health, and Humanitarian Intervention
Political Geography:
Global Focus

1844. The International Development Finance Club and the Sustainable Development Goals

Author:
Scott Morris
Publication Date:
12-2018
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
The Sustainable Development Goals (SDGs) face a key dilemma . Although major multilateral institutions like the World Bank and the other core multilateral devel- opment banks (MDBs) have played a leadership role in shaping the SDG financing framework, there is a sig- nificant misalignment between the structure of these institutions and SDG financing needs . Specifically, the SDGs put countries, not multilateral institutions or foreign donors, at the forefront in achieving desired outcomes . Further, the SDG financing agenda identi- fies an important role for the private sector and other nonsovereign actors . Although the MDBs will remain key players in SDG financing, other leading actors—and particularly, other ways of organizing across institu- tions—will be needed to meet the SDGs . The International Development Finance Club (IDFC) is uniquely positioned to play a leadership role on the SDGs . A diverse group of development finance insti- tutions (DFIs), IDFC members collectively embrace a strong country-led focus and private-sector orienta- tion . Members represent a variety of models . Some act as national banks, focused primarily on domestic financing . Others act as bilateral aid agencies and DFIs . Still others act as regional and multilateral develop- ment institutions . Together they bring considerable financial and strategic resources to meet SDG financing needs, and they appear to be well matched to respond to key SDG requirements, including the call for nation- ally led development strategies and the need for sub- stantial private-sector and nonsovereign investment, particularly in infrastructure . This report surveys 22 IDFC member institutions to identify the club’s role in meeting SDG financing needs . Through institutional snapshots, aggregated financial data, qualitative inputs, and case studies, the report reveals a high degree of SDG relevance in these development institutions . We find that the total assets of IDFC institutions are significantly greater than the total assets of core MDBs, indicating that as an orga- nization, IDFC has untapped power as an organiz- ing platform for the SDG agenda . We also find a high degree of alignment between IDFC-reported activities and the full range of SDGs, though only a minority of IDFC members inform their operations with an explicit SDG strategy . Most relevant to the question of leveraging private financing for the SDGs, especially infrastructure, our survey indicates that as a group, IDFC members primarily finance nonsovereign enti- ties, especially private firms, in the course of pursuing development objectives . The IDFC could play a stronger leadership role on behalf of its membership by better aligning its mandate with the SDG agenda . We see a future in which IDFC members adopt common standards for SDG frame- works and for tracking the inputs and outputs relevant to the SDGs . Members should consider the degree to which they wish to make the club a meaningful plat- form for coordination, deliberation, and visibility for the broader SDG agenda . This agenda implies a wid- ening set of demands on members and may require a more robust secretariat to support a wider range of reporting activities, information gathering, agenda setting, and convening . Through a greater commitment to SDG-oriented activ- ities, IDFC members could demonstrate the value of organizing around national, bilateral, and multilateral development institutions to address the leading devel- opment challenges in the years ahead .
Topic:
Development, Finance, Sustainable Development Goals, and Sustainability
Political Geography:
Global Focus

1845. UK Aid Quality Indicators

Author:
Caitlin McKee, Ian Mitchell, and Arthur Baker
Publication Date:
12-2018
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
This paper discusses the United Kingdom’s foreign aid quality based on an updated assessment of the Quality of Official Development Assistance (QuODA) published by the Center for Global Development. QuODA uses 24 quantitative indicators based on how aid is given, grouped into four themes: maximizing efficiency, fostering institutions, reducing the burden on recipient countries, and transparency and learning. These are based on principles which donor and recipient countries agreed to in a series of high-level meetings on aid effectiveness. We find UK aid quality has decreased from 2012 to 2016 and now ranks 15th out of the 27 countries assessed. The quality of its multilateral aid is relatively strong with significant contributions to EU institutions who score in the top half of multilateral agencies, and well-above the UK’s bilateral aid. We analyse the UK’s bilateral aid in detail, identifying areas of relative strength but also four recommendations for the UK Government to improve aid effectiveness
Topic:
Development, International Cooperation, Foreign Aid, and Multilateralism
Political Geography:
United Kingdom and Europe

1846. Searching for a Historic Agreement between Serbs & Albanians on Kosovo: From Ambiguities to Clarity

Author:
Dimitris A. Moschopoulos
Publication Date:
02-2018
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
The paper takes as starting point the call by President Vucic of Serbia for a dialogue on the future of Kosovo with a view to reaching a historic agreement between Serbs and Albanians that would help his country deal with the Kosovo issue and would make it possible for it to secure a future in the European Union. The author attempts an assessment of various efforts for settling the dispute between Serbia and Kosovo, including the Ahtisaari Plan of 2007 and the Brussels Dialogue between Belgrade and Pristina currently going on, and tries to clarify some ambiguities and misunderstandings still prevailing about basic parameters of the conflict and of the European integration of the two sides. An analysis of the principles set by Mr. Vucic to guide the debate between Serbs and Albanians, namely that (a) Serbia does not covet what doesn’t belong to her and will not relinquish what belongs to her, and (b) the protection of the Serbian religious and cultural heritage in Kosovo is of paramount importance to Serbia, leads to the conclusion that the envisaged agreement should have (a) Serbia recognize that it does not own Kosovo’s statehood, which rightfully belongs to Kosovo, and (b) Kosovo accord an exceptionalism status to the Serbian religious and cultural heritage in its territory. The author further argues that the ideal agreement between the two sides turns out to also be a possible one.
Topic:
Conflict Resolution, Religion, Treaties and Agreements, and Culture
Political Geography:
Europe, Kosovo, and Serbia

1847. Time Is Running out in the Northern Part of Cyprus

Author:
Nikolaos Stelgias
Publication Date:
03-2018
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
The collapse of the talks in Crans-Montana caused significant concerns to the Turkish Cypriots that believe in the Federal solution of the Cyprus issue. These segments of the community, which hope that the establishment of a united federal Cyprus will lead to the resolution of all their socio-political and economic problems are searching for a political framework through which they will channel their dissatisfaction and their aspirations. At the same time, the Turkish Cypriot community, being cut off from the international scene, depends solely on Turkey and the Anatolian economy which is currently facing systemic problems. Within this context, the Turkish Cypriots understand that the need for the social, political and economic reconstruction of “TRNC” is urgent.
Topic:
Security, Foreign Policy, Politics, and Negotiation
Political Geography:
Europe, Cyprus, and Mediterranean

1848. Early Turkish elections: Erdoğan’s strengths and challenges

Author:
Nikolaos Stelgias
Publication Date:
06-2018
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
Fifteen years since the party’s ascendance in power, AK Parti enters for the first time an electoral race facing several important challenges. Despite the economic crisis and the government’s authoritarian policy, Erdoğan could still win the elections based on his advantages and the weaknesses of the opposition. In the early elections of 24th June, AK Parti could secure the continuation of its power, but in the second round of elections may create interesting balances in the new parliament.
Topic:
Politics, Authoritarianism, and Elections
Political Geography:
Europe, Turkey, and Mediterranean

1849. An Unholy Alliance of Muslim Extremists and Organized Crime in the Balkans Case Studies: Albania, Kosovo, Bosnia Herzegovina

Author:
Spiros Bamiatzis
Publication Date:
06-2018
Content Type:
Working Paper
Institution:
Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:
The 1990s wars in Yugoslavia led to the disintegration of the country and ushered an era of poverty, political corruption, organized crime and terrorism. The Balkans became synonymous with the syndrome of a failed state, where civil society institutions are doomed to fail. The area has presented the international community with some unique challenges associated with unemployment, jihadism, crime and all those maladies under the wings of political leaderships that have given many reasons to the international community to doubt their credibility and their belief to the rule of law. This study will prove that a nexus exists between Islamic and ethno-nationalist terrorism and illegal criminal activities, and it will focus mainly in three countries: Albania, Kosovo, and Bosnia Herzegovina.
Topic:
Corruption, Islam, Poverty, Violent Extremism, and Organized Crime
Political Geography:
Bosnia, Herzegovina, Kosovo, Yugoslavia, Balkans, and Albania

1850. Access to Capital for Urban Innovators: Report to the Bank of America Charitable Foundation

Author:
Aspen Institute
Publication Date:
06-2018
Content Type:
Working Paper
Institution:
Aspen Institute
Abstract:
Urban innovators share a commitment to using new approaches, and often new technologies, to tackle long-standing challenges that seem unsolvable to others and that affect a large number of cities. Despite urban innovators’ insightful ideas on new ways to solve metropolitan areas’ most difficult challenges, many lack access to critical resources, tools, and funding. These access to capital hurdles most severely affect women entrepreneurs and entrepreneurs of color, who historically have lacked opportunities for creating their own ventures, building wealth, and achieving financial empowerment. Throughout 2016 – 2017 the Aspen Institute Center for Urban Innovation worked with partner programs and organizations to demonstrate the sustainable impact urban innovators have when they have access to the capital necessary to start, grow, and stabilize their organizations and businesses. We learned from entrepreneurs, leaders of support organizations, government officials, and funders from capital-heavy places such as Silicon Valley, New York, and Boston, but also from places starting to garner more attention for their innovation-friendly cultures such as Buffalo, Cincinnati, and New Orleans. The Access to Capital for Urban Innovators report highlights the lessons learned from several convenings and programs focused on strategies to eliminate barriers to resources for women entrepreneurs and entrepreneurs of color. We heard firsthand what urban innovators need to achieve success, and put forth principles and ideas on ways different sectors can improve their cities’ economy and become centers of inclusive prosperity
Topic:
Science and Technology, Finance, Urban, and Innovation
Political Geography:
United States and North America