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What impact does corruption have on development, and what’s the best way to stamp it out? Some in the media would have you believe that large amounts of public money are being pocketed by corrupt officials, and that the only way to stop it is to cut foreign aid budgets. Meanwhile, aid agencies and others argue that foreign aid is necessary to save lives. How do we square these?
In a new book called Results, Not Receipts: Counting the Right Things in Aid and Corruption, CGD senior fellow Charles Kenny offers a way to strengthen the case for aid and reduce corruption at the same time: focus on outcomes, rather than inputs.
Director of Technology and Development and Senior Fellow
“If you get a road built to quality . . . and you’ve ended up with a price that seems right for the cost of building that road, there’s no money left over there to fuel corruption,” Kenny explains in this week’s podcast. On the other hand, he says, if you don’t monitor the outcome of your project, it becomes very easy for contractors to cut corners.
Focusing on outcomes also helps donors and agencies demonstrate impact. “When you focus very heavily on receipts, all you have to show your voter is a bunch of paper,” Kenny tells me. “I want to see the healthy kid, I want to see the kid who’s been educated. . . . If we can deliver that, I think we make the case for aid much stronger.”
CGD and Brookings recently co-hosted Former Finance Minister of Nigeria and Distinguished Fellow Ngozi Okonjo-Iweala to discuss her new book, Fighting Corruption is Dangerous: The Story Behind the Headlines. The book is part memoir, part how-to, as she draws on her years of experience as Nigeria’s Finance Minister to describe the dangers of fighting corruption and how best to do it. I drew four main takeaways from our conversation.
The SDGs include a target to “significantly reduce illicit financial and arms flows, strengthen the recovery and return of stolen assets and combat all forms of organised crime”. However, there is no globally agreed upon definition for “illicit financial flows.” My new CGD paper looks at why there is so much disagreement and confusion over this term.
Public-Private Partnership models continue to proliferate, backed by multilateral development banks old and new. But the volume of PPPs in developing countries has stagnated since the global financial crisis, and they won’t deliver unless they are designed and implemented well. Making more and better public-private investments will take a far greater commitment to transparency from participants in the deals. Financiers—MDBs in particular—should take the lead.
Events are in tremendous flux in Zimbabwe after the non-coup committed by the military last week and the resignation of President Robert Mugabe on November 21. It’s not too early for the international community to start considering constructive steps to help the country get through the inevitable transition and back on a path to democracy and prosperity.