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CGD experts offer ideas and analysis to improve international development policy. Also check out our Global Health blog and US Development Policy blog.

 

Philippe Le Houérou at the WEF. Photo by World Economic Forum / Jakob Polacsek

Aid Transparency and Subsidies to Private Companies: A First Step, But a Long Road Ahead

Today the IFC announced a step forward in its transparency around the use of aid resources to finance private companies. That’s right and proper: When scarce aid, and scarce tax resources, are used to support private firms, citizens of donor countries and recipient countries alike have a right to know where the money is going to and how generous the terms. A number of us at CGD had been calling for greater transparency around subsidies to the private sector from the IFC and other development finance institutions, so this is a welcome first step. However, a few aspects have might be cause for concern.

An image showing money with relation to subsidies

Introducing Five Principles for the Use of Aid in Subsidies to the Private Sector

Development finance institutions like the International Finance Corporation and the UK’s CDC Group use public finance to support private investments in developing countries. At their best they can help create new markets and invest in the delivery of vital goods and services, creating good jobs and entrepreneurial opportunity along the way. They have been rapidly expanding over the past few years.

Chart showing IFC project ratings

Is the New Model IFC a Good Deal for IDA Countries?

For much of the last decade, the World Bank’s private sector arm, the International Finance Corporation (IFC), has delivered a share of its profits as grants to the World Bank Group’s soft lending arm for governments, the International Development Association (IDA). In the last couple of years that pattern has reversed.

Visualization breaking down where most aid goes

Focusing UK Research Aid Where It Matters

The UK’s development agency, DFID, has stated that it views research as the best way to spend aid and that it intends to place high quality research central to its aid strategy. In a new paper, we find significant problems with the way that UK aid is being used to back research: a huge ramp-up in support has largely gone to fund opaque, unfocused research in UK universities. There are better approaches.

The UK Needs a New Formula for ODA-Funded Research

The UK government has recently ramped up the amount of aid that is directed towards research and development. While this can be positive in ensuring a sound research base for UK aid funds, this should not be seen as an opportunity to plug UK university funding deficits, or to "tie aid" to the UK economy.

Screenshot of the analytics dashboard for Ukraine's Prozorro

Measuring the Impact of Open Contracting

In a new CGD working paper, we try to measure the impact of one of the most significant open contracting reforms worldwide, which took place in Ukraine in the last few years. Since 2015, the country has overhauled its procurement system, including the introduction of an e-procurement platform called ProZorro.

A community health worker conducting a survey in the Korail slum, Bangladesh

Changing Norms Around Gender and Economic Rewards

A world where risk-taking and competition weren’t considered quite so admirable or so male, and where more stereotypically “feminine” traits like cooperation were properly recognized and rewarded, would be better for both women and men.

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