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From the article:
“…U.S. President Donald Trump’s attack on the World Health Organization has stoked fears of a breakdown in international leadership and support for the multilateral system, while advocates for a strong and sustained World Bank response to the pandemic hope that the institution will be spared from those political battles.
‘The [multilateral development bank] system seems to have managed to avoid the wrath of this president, and perhaps that suggests there is more scope for them to be able to do more over time without threats for their funding being cut or otherwise impeded by political motivation,’ said Scott Morris, senior fellow at the Center for Global Development, on Wednesday…”
From the op-ed in Inter-Press Service
Of course, I am not expecting the G20 suddenly, due to COVID-19 to take on an operational role. However, I would have expected that, this time, they would have acted differently: lived up to the exceptional scale and urgency of the crisis the world confronts.
For example, they could have decided to act as lead investors in a global mission-oriented project, perhaps executed, by the World Bank, in close collaboration with WHO and other multilateral development banks or other appropriate agencies, and aimed at establishing a sizeable special fund that could be used to bulk-purchase face masks (if and when available), security equipment and gowns for hospital staff, beds, medicines and, in due course, vaccines –in order to make these supplies available at affordable prices to poorer developing countries.
From the article:
“As the coronavirus pandemic sweeps across the U.S., claiming more than 23,600 lives as of Tuesday, the Trump administration has come under fire for disregarding guidance from past administrations on combating a pandemic and for pushing for funding cuts to some core public health programs on which the country now depends.
But the administration has also failed to meet the goals laid out in its own pandemic plan, which was developed in the first year of Trump’s presidency and released in December 2017. That plan, an update and rework of previous’ administrations’ strategies, is focused on preparing for a virulent strain of influenza rather than the novel coronavirus. That means that some flu-specific goals, such as the development of a vaccine in just a few months, can’t be applied to the current crisis. But nearly all of the objectives for preparing for and responding to emerging diseases are applicable -- from how to communicate effectively with the public to how to develop, stockpile and distribute enough respirator masks to keep health workers safe.
‘It’s a fine plan and hits a lot of the right notes,’ said Jeremy Konyndyk, a senior policy fellow at the Center for Global Development who led efforts on global disaster response under the Obama administration. ‘The failure was a leadership and execution failure…’”
From the op-ed:
"On April 6, there were reports of a clash between youthful traders at a temporary market and police enforcing Covid-19 lockdown restrictions in Kaduna, Nigeria. It left five dead with multiple sustaining gunshot wounds. This follows movement ban related shooting deaths in Rwanda, one in South Africa, the death of a teenager in Kenya and two sustaining gunshot wounds in Uganda.
These clashes will only increase and escalate if the choice remains for daily wage earners to stay at home and face inevitable starvation or venture out and face the wrath of security services. The response to the Covid-19 pandemic that has become standard in high and middle-income countries is, in its current form, unfeasible, impractical, and arguably counterproductive in low income countries, especially across sub-Saharan Africa.
These difficulties, however, do not make these social distancing measures any less necessary. We need these public health measures. Our challenge is to adapt them to informal economies which lack a comprehensive safety net to support those shut in.
Cash-driven informal sectors are a huge share of the economy of most developing countries, particularly in Africa where between 30% to 90% of all non-agricultural jobs are informal. Millions of Africans are unable to survive without some form of daily trade and don’t have the advantages of bank savings, credit cards and online commerce to be able to stay indoors or “social distance” for extended periods. Our choices, however, need not be so stark or irreconcilable. The recommendations below, which are neither exhaustive nor universally applicable, attempt to adapt social distancing to Africa’s informal economies. It is possible this disease will be with us for up to a year, and thus must be met with public policy that can be sustainably implemented over the long haul.
While the crisis is a test for underfunded health systems, it will also be an exacting examination of any state’s governance capabilities and social cohesion. It cannot be overemphasized that any country attempting to implement these adjustments must ensure eternal vigilance since relaxation could potentially lead to carelessness, causing infections to explode…”
From the article:
“…Amanda Glassman, the executive vice-president and senior fellow at the Center for Global Development, said a deeper problem is the WHO’s low budget and relatively toothless structure. Unlike the nuclear watchdog, the International Atomic Energy Agency, it has no redress against governments that do not cooperate.
‘It operates in countries at the pleasure and permission of the host country governments. So in the case of China, to be allowed to enter China, it was a negotiation to get there,’ Glassman said.
She added that the real challenge for the WHO has yet come, when the pandemic really hits poorer countries with fragile, underfunded health services, who rely heavily on the organisation.
Unlike the Ebola outbreak in 2014, the US will not be there to take the lead, and it will be up to the WHO to coordinate scarce resources and expertise.
‘Can they do that in 40 countries at once?’ Glassman asked. ‘That is the part that remains to be tested…’”
From the article:
“…LMICs will therefore need more funding than usual, to deal with the aftermath of the pandemic, and to rebuild health systems and economies. At the same time, the pandemic could deplete the economies of LMICs, and make them more dependent on international aid. HICs, having suffered huge economic losses, could use Covid-19 as the excuse to cut development assistance for health, and recast global health as a narrow mandate focused on ‘national security’.
‘Economies worldwide will be substantially weakened, so the evolution of low-income to middle-income country status will slow down or reverse, and - even while more is needed - broader development assistance will be at risk, said Amanda Glassman, vice president and senior fellow at the Center for Global Development…’”
China's loans aren't debt traps, researchers say, but interest rates are consistently higher than World Bank
Center for Global Development
WASHINGTON – As the COVID-19 economic crisis brings about rising concerns over debt sustainability in developing countries, a new report from the Center for Global Development (CGD) finds that China's loans tend to have shorter grace periods and maturities and higher interest rates than loans from the World Bank.
“With developing countries taking an economic hit from the COVID-19 pandemic, there’s a real concern about debt risks in developing countries—many of which were already at risk of debt distress. China is now the largest bilateral lender in the world, so decisions made in Beijing have a huge impact on the economies of developing countries,” said Scott Morris, a senior fellow at CGD and an author of the report.
“We found that China's loans have consistently contained harder terms than the World Bank, particularly for the poorest countries. Most of the discussions of debt vulnerability in developing countries have focused on the overall amount of borrowing, but the shift in loan terms matters a lot too,” said Brad Parks, the executive director of AidData and an author of the report. “That said, while we have concerns, we don’t find evidence for the ‘debt trap’ narrative. A few percentage points more in interest compared to the World Bank hardly seems usurious.”
With a lack of official Chinese government data on its lending programs, the researchers created a database of 2,453 loans from China and 4,859 loans from the World Bank for comparison, spanning 157 countries and 15 years. Data includes loan-by-loan information on interest rates, maturities, and grace periods, including for projects that fall under the Belt and Road Initiative.
Total Financing (USD)
Average Loan Size (USD)
Average Grant Size (USD)
Total Number of Projects
Volume of Grants (% total financing)
Volume of Loans
Weighted Mean Interest Rate
Weighted Mean Maturity (years)
Weighted Mean Grace Period (years)
“It's clear that developing country governments find value in China’s lending, compared to what they can get on the markets. But it's incredibly important that the Chinese government, which has a stated commitment to debt sustainability, carry out its lending program in a way that doesn’t heighten debt risks in its partners,” Morris said.
“The IMF and the World Bank are calling for lenders to step up and help developing countries with their debt obligations during the crisis. As one of the world’s leading creditors, this is a good opportunity for Beijing to show that it’s sensitive to debt risks.”
The full report and dataset are available at https://www.cgdev.org/publication/chinese-and-world-bank-lending-terms-systematic-comparison
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Center for Global Development
WASHINGTON – As governments across the globe begin to use direct transfers to get money to citizens unable to work, a new report from the Center for Global Development (CGD) finds that just 56% of citizens across 99 developing countries have access to a phone, a bank account, and an ID. Those three things, the researchers find, are the building blocks for the successful rollout of digital government transfers, from emergency cash transfers in a pandemic to everyday government programs like pensions and food subsidies.
“Governments around the world are moving full-steam ahead to get money in the hands of their citizens who are out of work due to the coronavirus. But we found that for digital payments from governments to work well, countries need to have the digital basics in place: bank accounts, IDs, and phones. And far too many developing countries are running behind on making sure their citizens have access to those basics,” said Alan Gelb, one of the authors of the study and a senior fellow at CGD.
“There are a lot of advantages to bringing government payments online. It can cut out costly middlemen and time-wasting activities like waiting in line to pick up a ration payment, as well as providing a much stronger defense against corruption, “Gelb said. “And, in a crisis like this, it means you have the digital infrastructure ready to go for something like emergency cash transfers.
“India has been at the forefront, digitizing programs like pensions and subsidies to buy cooking gas for poor families. And what India’s experience illustrates is how you need a trio of digital basics to make payments work: a digital ID to prove a person is who they say they are, a financial account to for them receive the money, and a mobile phone that can be both an information hub and a tool to access that money,” said Anit Mukherjee, a policy fellow at CGD and another author of the study.
The researchers found that while many governments had focused on rolling out national biometric ID programs, like India’s Aadhaar system, financial inclusion is the biggest hurdle for most. About 34% of the population in the 99 countries they examined lacked a financial account, and in the lowest-performing countries, more than two thirds of the population did not have access to a financial account.
“We found that the lack of bank and mobile money accounts is the biggest gap in digital readiness. It’s hard to get money to citizens who don’t have either,” said Mukherjee.
The report found:
There are significant gender gaps in access to phones, IDs, and especially bank accounts. In sub-Saharan African countries, men were at least 9 percentage points more likely to have access to each of the three than women.
More than twenty percent of women in Pakistan don’t have access to even one of a bank account, mobile phone, or ID, four times the rate of men.
Sub-Saharan African countries tend to have relatively high rates of financial inclusion, thanks to widespread use of mobile money in many countries, led by Kenya, which did better than much richer countries on that front.
Financial inclusion remains relatively low in Latin America. While nearly 80% of Latin Americans had access to a mobile phone, barely more than 50% had a bank or mobile money account.
The good news, they found, is that building on one part of the basics helps expands others. Everything else being equal, having an ID and a mobile phone increases the likelihood that a person will have access to a financial account, particularly for groups that are disadvantaged. Also, even as access makes it easier to implement social transfers, transfers can themselves be a powerful force for increasing financial inclusion.
“None of these numbers are set in stone. Governments can and should work to expand their citizens’ access to the digital basics. And they should need to ensure that they do it in ways that don’t reinforce existing inequalities,” Gelb said.
The full report is available at https://www.cgdev.org/publication/citizens-and-states-how-can-digital-id-and-payments-improve-state-capacity.