Ideas to Action:

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March 4, 2018

China’s Belt and Road Initiative Heightens Debt Risks in Eight Countries, Points to Need for Better Lending Practices

Researchers urge China to improve their debt practices and adopt standards

Contact: Holly Shulman Center for Global Development +1-202-416-4040HShulman@cgdev.org,

Washington – China’s Belt and Road Initiative – which plans to invest as much as $8 trillion in infrastructure projects across Europe, Africa, and Asia – raises serious concerns about sovereign debt sustainability in eight countries it funds, according to a new study from the Center for Global Development.

The study evaluated the current and future debt levels of the 68 countries hosting BRI-funded projects. It found that of the 23 countries that are at risk of debt distress today, in eight of those countries, future BRI-related financing will significantly add to the risk of debt distress. You can see the full list of countries, their external debt levels, and China’s portion of that debt in the new study here.

“Belt and Road provides something that countries desperately want – financing for infrastructure,” said John Hurley, a visiting fellow at the Center for Global Development and a coauthor of the study. “But when it comes to this type of lending, there can be too much of a good thing.”

According to the study, China’s track record managing debt distress has been problematic, and unlike the world’s other leading government creditors, China has not signed on to a binding set of rules of the road when it comes to avoiding unsustainable lending and addressing debt problems when they arise.

“Our research makes clear that China needs to adopt standards and improve its debt practices – and soon,” said Scott Morris, a senior fellow at the Center for Global Development and a coauthor of the paper.

The study recommends that China:

Multilateralize the Belt and Road Initiative: Currently, the multilateral development institutions like the World Bank are lending their reputations to the broader initiative while only seeking to obtain operational standards that will apply to a very narrow slice of BRI projects: those financed by the MDBs themselves. Before going further, the MDBs should work toward a more detailed agreement with the Chinese government when it comes to the lending standards that will apply to any BRI project, no matter the lender.

Consider additional mechanisms to agree to lending standards: Some methods might include a post-Paris Club approach to collective creditor action, implementing a China-led G-20 sustainable financing agenda, and using China’s aid dollars to mitigate risks of default.

In all eight highest risk countries, the proportion of external debt that is owed to China and its banks will rise, sometimes dramatically, under the Belt and Road Initiative:

Pakistan: Pakistan, by far the largest country at high risk, currently projects an estimated $62 billion in additional debt, with China reportedly financing roughly 80 percent of that. Big-ticket BRI projects and the relatively high interest rates being charged by China add to Pakistan’s risk of debt distress.

Djibouti: The most recent IMF assessment stresses the extremely risky nature of Djibouti’s borrowing program, noting that in just two years, public external debt has increased from 50 to 85 percent of GDP, the highest of any low-income country. Much of the debt consists of government-guaranteed public enterprise debt and is owed to China Exim Bank.

Maldives: China is heavily involved in the Maldives’ three most prominent investment projects: an upgrade of the international airport costing around US$830 million, the development of a new population center and bridge near the airport costing around US$400 million, and the relocation of the major port (no cost estimate). The country is considered by the World Bank and the IMF to be at a high risk of debt distress and is currently being buffeted by domestic political turmoil.

Lao, P.D.R. (Laos): Laos, one of the poorest countries in Southeast Asia, has several BRI-linked projects. The largest, a $6.7 billion China-Laos railway, represents almost half the country’s GDP, which led the IMF to warn that the project might threaten the country’s ability to service its debts.

Mongolia: Mongolia’s future economic prosperity depends on major infrastructure investments. Recognizing Mongolia’s difficult situation, China Exim Bank agreed in early 2017 to provide financing under its US$1 billion line of credit at concessional rates for a hydropower project and a highway project. If reports of an additional $30 billion in credit for BRI-related projects over the next five to ten years are true, then the prospect of a Mongolia default is extremely high, regardless of the concessional nature of the financing.

Montenegro: The World Bank estimates that public debt as a share of GDP will climb to a whopping 83 percent in 2018. The source of the problem is one very large infrastructure project, a motorway linking the port of Bar with Serbia that would integrate the Montenegrin transport network with other Baltic countries. The Montenegro authorities concluded an agreement with China Exim Bank in 2014 to finance 85 percent of the estimated US$1 billion cost for the first phase of the project, with the second and third phases likely to lead to default if financing is not provided on highly concessional terms.

Tajikistan: One of the poorest countries in Asia, Tajikistan is already assessed by the IMF and World Bank to be at “high risk” of debt distress. Despite this, it is planning to increase its external debt to pay for infrastructure investments in the power and transportation sectors. Debt to China, Tajikistan’s single largest creditor, accounts for almost 80 percent of the total increase in Tajikistan’s external debt over the 2007-2016 period.

Kyrgyzstan: Kyrgyzstan is a relatively poor country with significant new BRI-related infrastructure projects, much of it financed by external debt. China Exim Bank is the largest single creditor, with reported loans by the end of 2016 totaling US$1.5 billion, or roughly 40 percent of the country's total external debt. While currently considered to be at a “moderate” risk of debt distress, Kyrgyzstan remains vulnerable.

The full study, “Examining the Debt Implications of the Belt and Road Initiative from a Policy Perspective” can be found at: https://www.cgdev.org/publication/examining-debt-implications-belt-and-road-initiative-policy-perspective.

February 20, 2018

New Study: Grid Electricity and Off-Grid Solutions Alone Are Not Meeting Many Africans’ Energy Demands

On-Grid Customers Still Rely Heavily on Off-Grid Energy Technologies, and Off-Grid Customers Want On-Grid Electricity

Contact: Holly Shulman Center for Global Development HShulman@cgdev.org, (202) 674-8757

Washington – A new study released today by the Center for Global Development found that either grid electricity or off-grid solutions alone are currently inadequate to meet many African consumers’ modern energy demands. The survey of consumers in twelve African countries found that on-grid customers still rely heavily on off-grid solutions like generators for their daily lives, and that off-grid customers want access to on-grid electricity.

The researchers analyzed data from mobile phone-based surveys to assess energy service quality and demand in in twelve African countries: Benin, the Democratic Republic of the Congo (DR Congo), Ethiopia, Ghana, Kenya, Mozambique, Nigeria, Rwanda, Senegal, Tanzania, Uganda, and Zambia. The surveys were conducted between July 2015 and December 2016, and received responses from 39,000 consumers in 28 languages.

“Making electricity more accessible, reliable, and responsive to African demand across the continent should be a priority,” said Todd Moss, a co-author of the report and a senior fellow at the Center for Global Development. “While many policymakers debate whether grid or off-grid solutions are most appropriate, African consumers don’t view these options as an either-or question. Customers who are on the grid want to be able to use off-grid electricity too. And customers who have off-grid power want access to grid electricity to meet growing demand.”

“Off-grid customers may appreciate the lights and basic appliances like phone chargers that off-grid systems can power, but want to move up the energy ladder toward higher power appliances like refrigerators enabled by a grid connection. At the same time, on-grid customers face a host of reliability issues and thus see off-grid options as an important backup.”

Key findings from the survey include:

Daily outages are a norm almost everywhere. Among those with access to grid electricity, at least half cited electricity outages at least once a day across almost all surveyed countries. Respondents in Mozambique, Ghana, and Zambia reported the highest prevalence of daily outages. The country with the lowest prevalence of frequent outages was Rwanda, where only 18 percent of respondents experienced multiple outages per day. In all countries, the vast majority reported at least one outage per week.

On-grid customers still rely heavily on generators, especially in Nigeria. Almost half of on-grid respondents in Nigeria relied on a generator during power outages – the highest of any other country.

Off-grid customers still desire grid electricity. In most countries, off-grid respondents are not completely satisfied by off-grid electricity solutions and retain a high demand for grid electricity.

Off-grid, non-generator electricity is inadequate for most respondents’ energy needs. A significant proportion of respondents across the surveyed countries reported that their off-grid electricity solution did not fulfill any of their power needs. This includes almost two thirds (65 percent) of Rwandans with off-grid, non-generator electricity.

In all countries, the majority desire a grid connection. Demand for the grid was highest in Zambia and Ghana, where over 50 percent said that they wanted an electrical connection very much. In all other countries except Senegal and Benin, demand appears to be high but less passionate; over two-thirds of respondents without an electric connection indicated that they wanted an electrical connection to the national grid either a little or very much.

Satisfaction with service from the grid varies widely. Reported satisfaction with grid electricity ran from Mozambique (74 percent satisfied) and Rwanda (71) at the high end to Ghana (19) and Zambia (27).

Connection costs and distance from the grid are the most common obstacles to grid electricity. When asked about the greatest obstacle to gaining access to the national grid, most respondents cited either the cost of electricity, the cost of connection, or the lack of proximity to the grid.

Demand is high for energy-intensive appliances, especially TVs. Off-grid households indicate a high demand for energy-intensive appliances, particularly televisions and refrigerators. The survey also asked respondents what appliance they would like to purchase if they gained a grid connection (refrigerator, television, hot plate, radio, or iron). Televisions are the most common aspirational purchase across most surveyed countries.

You can read the full study at https://www.cgdev.org/publication/what-can-we-learn-about-energy-access-and-demand-mobile-phone-surveys.

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February 19, 2018

New Study: To Address De-risking and Comply with AML/CFT Regulations, Banks Are Turning to Artificial Intelligence and Other New Technologies

“Regtech May be the Solution to Some De-risking Woes,” Says Center for Global Development’s Vijaya Ramachandran

Contact: Holly Shulman Center for Global Development (202) 674-8757HShulman@cgdev.org,

Washington – Today, the Center for Global Development released a new study that finds that financial institutions have turned to new technologies, including artificial intelligence, to address de-risking and increase the effectiveness and efficiency of their AML/CFT compliance. These new technologies may enhance transparency and information-sharing capabilities, facilitate automation and interoperability between institutions, and improve banks’ ability to accurately identify illicit activity.

This study is the first comprehensive effort to assess six key new technologies and their potential to solve the de-risking problem: know-your-customer (KYC) utilities, big data, machine learning, distributed ledger technology (DLT), legal entity identifiers (LEIs), and biometrics.

“Some policies that have been put in place to counter financial crimes have unfortunately had a chilling effect on banks’ willingness to do business in markets perceived to be risky in part due to the high price of compliance. This has had costly consequences for people in developing countries, and have hurt migrant workers, small businesses that need to access capital, and recipients of lifesaving aid in conflict, post-conflict, or post-disaster situations the most,” said Vijaya Ramachandran, one of the study’s authors. “But what we’re seeing is that even as these policies are having an impact, financial institutions are coming up with solutions in the form of new cutting edge technologies to help them comply better and faster with anti-money laundering regulations.”

The study suggests that new regulatory technologies (“Regtech”) may offer a partial solution to de-risking by lowering compliance costs and improving risk management capabilities. The technologies include:

Machine learning is a type of artificial intelligence that allows computers to improve their performance at a task through repeated iterations. Machine learning may be used to augment or transform a number of compliance functions, including those for developing more sophisticated customer typologies and for more accurately monitoring transactions. These uses could simultaneously cut down on false alerts and identify undetected illicit finance techniques.

Biometrics use distinctive physiological or behavioral characteristics to authenticate a person’s identity and control his or her access to a system, and are more robust than other authentication factors, such as passwords and tokens, as they are generally more secure and easier to use. Biometrics are being used to address the “identification gap” that exists in many developing countries. This use, in turn, could make it easier for banks to conduct customer identification, verification, and due diligence, which may bolster the confidence of their correspondent banks. However, most biometric identification systems are being developed at the national level, meaning that work is required to develop an internationally recognized and interoperable identification system.

Know Your Customer (KYC) utilities are central repositories for customer due diligence (CDD) information. By centralizing information collection and verification, KYC utilities can reduce the amount of information that has to be exchanged bilaterally between correspondent banks and their respondents, thereby reducing the time banks spend conducting CDD investigations.

Big data refers to datasets that are high in volume, high in velocity, and high in variety, and therefore require systems and analytical techniques that differ from those used for traditional datasets. Compared with relational databases, big data applications offer more scalable storage capacity and processing. They also allow many different types of data to be stored in one place, so compliance staff spend less time gathering information from disparate sources. Most important, they can greatly expand the range and scope of information available for KYC and suspicious transaction investigations.

Distributed Ledger Technology (DLT) is a way of securely organizing data on a peer-to-peer network of computers. In a blockchain, which is a type of DLT, data modifications, such as transactions, are recorded in time-stamped blocks. Each block is connected to previous blocks, forming a chain. Modifications are confirmed and stored by all users on the network, which makes the ledger difficult to tamper with. Although blockchain technology is most commonly associated with virtual currencies, such as Bitcoin, the basic technology has a number of other potential use cases, including uses in regulatory compliance. In particular, DLT may be used for securely storing and sharing KYC information, as well as for cheaper and more secure international payments.

Legal Entity Identifiers (LEI) are unique alphanumeric identifiers, like barcodes, that connect to reference datasets held in a public database. Any legal entity that makes financial transactions or enters into contracts may request an LEI. In many countries, especially developed ones, LEIs are increasingly mandated by regulation. To date, more than 1 million LEIs have been issued worldwide. By serving as common identifiers, LEIs can enable different platforms, organizational units, and institutions to refer to entities clearly and without any ambiguity. This interoperability can, in turn, facilitate greater automation and information sharing. A further extension of the LEI would be to include it in payment messages to identify originators and beneficiaries, which would further enhance the transparency of international payments.

This important study comes ahead of the Financial Action Task Force meeting in Paris – set for next week.

“In the face of de-risking, both the public and private sector have tried to find ways to lower the compliance burden without lowering standards,” said Ramachandran. “Our study finds that Regtech may be the solution to some de-risking woes. But for this to work, policymakers need to invest time in understanding how these technologies work, and what their benefits and limitations may be.”

You can read the full report at https://www.cgdev.org/reader/fixing-aml-can-new-technology-help-address-de-risking-dilemma.

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February 12, 2018

Statement on the Trump Administration’s Proposal to Establish a New Development Finance Institution

Contact: Holly Shulman Center for Global DevelopmentHShulman@cgdev.org, (202) 674-8757

Washington – Today, the Trump administration included in its budget funding for a new Development Finance Institution (see page 129 here).

Below is a statement from Todd Moss, a senior fellow at the Center for Global Development, who has been a leading advocate for modernizing U.S. development finance over the past several years:

“Because of the changing global landscape, development finance – rather than aid – is the future. Many previously poor countries are richer today and are looking for partnerships with the United States to deliver jobs, roads, and electricity instead of just aid.

“That’s why it’s so important that the administration included a proposal in its budget to create a new development finance institution. Expanding our commitment to development finance promotes deep capital markets, our culture of entrepreneurship, and our belief in free markets while at the same time spurring economic growth in the developing world.

“The White House today has shown its willingness to build markets for American goods in fast-growing emerging markets, support private sector led growth in our strategic allies, and ensure that U.S. companies are competing in these markets with Chinese and European firms—all at less than zero cost to taxpayers. Now, it’s up to Congress to finish the job.”

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October 13, 2017

New Study: Social Attitudes Toward Gays and Lesbians Rapidly Changing in Developing World

Washington – Today, Center for Global Development Senior Fellow Charles Kenny and Researcher Dev Patel released a new study that finds that just as social attitudes toward gays and lesbians have changed rapidly in the developed world, these attitudes are also changing in the developing world. The study also suggests that the changes in social attitudes often follow and are caused by changes in government policy toward gays and lesbians.

For Media Inquiries Holly Shulman Media Relations Consultant 202-416-4040 hshulman@cgdev.org

The study, “Norms and Reform: Legalizing Homosexuality Improves Attitudes” uses public opinion data on this issue from the Gallup World Poll and the World Values Survey and matches changes in attitudes over time with the timeline of laws concerning same-sex decriminalization. The study also includes data visualizations that show legal trends over time and geography.

Legality of homosexuality across the globe

“Improving rights for gays and lesbians is a critical human rights issue. In some countries, people are still imprisoned and even killed because of their sexual orientation. Even where it is not illegal, gays and lesbians face violence, discrimination, and social stigma,” said Charles Kenny. “But our research makes clear that in the developing world as a whole, both laws and attitudes are changing for the better. And legal change is not only a positive step in itself, it can also help shift attitudes.”

The study finds:

As of May 2017, there were 124 countries without any legal penalties for homosexuality, compared to 72 countries that criminalize same-sex sexual activity. In the last three decades the proportion of the world that report they do not want to live next to a gay or lesbian individual has dropped by about ten percentage points. International social norms influenced social norms in developing nations. For example, looking at Eastern European Block nations, eyeing admission into the European Union and the international community, attitudes changed quickly to match the EU consensus on gay and lesbian equality. When examining differing colonial origins of developing nations, former British colonies lag behind in legalizing homosexuality. 56% of countries where homosexuality is illegal are former British colonies, and 71% of former British colonies criminalize homosexuality. As law change so do social attitudes and norms. That means that those advocating for policy changes are playing an enormous role – changing not just laws but attitudes as well across the globe.

“A number of developing countries were decades ahead of the United States in legalizing homosexual sex and ensuring gay marriage rights, but they aren’t given much credit,” said Kenny. “While there are still disastrous human-rights violating policies in countries like Zimbabwe and Uganda that demand our attention, they are – thankfully – increasingly the exception.”

You can read the full study here. ##

September 6, 2016

New President Named for Center for Global Development

For Media Inquiries Forrest Rilling Media Relations Coordinator (202) 416-4040 frilling@cgdev.org

After an extensive international search, the Center for Global Development (CGD) is delighted to announce that Masood Ahmed is to become its new president, succeeding founding president Nancy Birdsall, who is stepping down after 15 years.

Ahmed will join CGD in early 2017, after leaving his current position as Director of the Middle East and Central Asia Department at the IMF. The Fund’s Managing Director Christine Lagarde has described him as a “visionary leader” in his role overseeing its work in the region. In a career spanning 35 years, he has also led the IMF’s External Relations Department, and held senior leadership positions at DFID and the World Bank, driving international economic policy relating to debt, aid effectiveness, trade, and global economic prospects. He was the senior Bank manager responsible for the HIPC Debt Initiative, which to date has provided debt relief packages to 36 countries worth $76 billion.

CGD’s Board Chair Lawrence H. Summers, who led the search committee, said: “Masood brings intellectual heft, policy expertise and a proven record in working to increase global prosperity.  His fresh ideas will enhance CGD’s reputation as a center of excellence for development policy. He will build on the strong foundations established by Nancy Birdsall for rigorous, evidence-based research and practical policy ideas.”

Ahmed, currently a member of CGD’s Advisory Group, said: “I am honored and excited to be able to continue CGD’s great work and take it to the next level. CGD occupies a prime position in the development, policy and research worlds; in my career these have also been my worlds, and I’ve always admired CGD’s unique brand of intellectually authoritative, politically smart, accessible research.”

Birdsall will stay on at CGD as President Emeritus and a senior fellow. She expressed delight at her successor. “Masood has been a longtime friend and adviser to me and to CGD,” she said. “No one better combines deep understanding of today’s development challenges with a clear-eyed grip on the potential and limitations of the rich world and the international economic institutions to make a difference. He will be a wise leader with deep experience on what CGD is about: how the global system can be made to work better for the world’s poor."

The Center for Global Development works to reduce global poverty and inequality through rigorous research and active engagement with the policy community. A nimble, independent, nonpartisan, and nonprofit think tank, our world-class researchers focus on a wide range of policy areas that affect development.

A global, competitive search for Birdsall’s successor was conducted by the internationally renowned recruitment firm Russell Reynolds, directed by the search committee that comprised mainly members of the CGD Board Executive Committee, led by Chair Lawrence H. Summers. 

April 5, 2016

From Haiti to Vietnam, Millions Saved Book Details Global Health Success in Some of the World’s Poorest Places

For Media Inquiries Forrest Rilling Media Relations Coordinator (202) 416-4040frilling@cgdev.org

April 5 marks the launch of Millions Saved, a collection of case studies by the Center for Global Development (CGD) detailing 18 remarkable global health successes and four crushing disappointments to determine what works – and what doesn’t – in global health.

At a glance, nearly eradicating Meningitis A in Africa, lowering the number of child marriages in Pakistan and preventing traumatic brain injury in Vietnam might seem unrelated, but through rigorous evaluation of these programs, co-authors Amanda Glassman, director of Global Health Policy, and Miriam Temin, a public health expert, have identified the policies and practices that paved the way for success.

“If we want to make even more global health progress and get the most health for our money, we must know what works and what doesn’t,” said Glassman. “Through the case studies in Millions Saved, we showed that major improvements in peoples’ lives are possible anywhere given the right conditions. Ultimately, it takes a combination of scientific advances, smart financing and the right group of people to come together to drive success.”

All of the success stories in Millions Saved had four features in common:

The programs were built using the best scientific evidence available as a guide. Partnerships and coalitions were formed to mobilize the necessary technical, financial and political resources both domestically and internationally. Not one, but many political leaders – sometimes across cycles – sustained efforts over time. Programs were rigorously evaluated to measure their impact.

Millions Saved has already been lauded by the world’s foremost leaders in global health. In a foreword to the book, Bill Gates, co-chair of the Bill & Melinda Gates Foundation, called Millions Saved “a refreshing reminder of our ability to take on some of the biggest global challenges,” and notes that “it underscores the incredible impact development aid can have—and why it’s so important that we continue to support poor countries in lifting themselves out of poverty.”

Each case in Millions Saved has a story to tell. Some of them are available on the Millions Saved website (millionssaved.cgdev.org). If you’re interested in writing about findings in the book or any of these cases, please contact frilling@cgdev.org.

Here are the cases:

Rolling Out Medicine and Technology

AFRICA & MENINGITIS: An old scourge, meningitis A, meets a new vaccine, MenAfriVac. Two hundred and thirty-five million immunizations later, fifteen African countries achieve historic reductions in incidence and deaths. Get the case at here. OTSWANA & HIV: In Botswana, the government distributes lifesaving treatment at zero cost to people living with HIV, and AIDS deaths plummet by more than 70 percent in less than a decade. Get the case here. CHINA & CANCER: China’s government extends the reach of hepatitis B vaccination nationwide and blocks a looming liver cancer epidemic. ZAMBIA & MALARIA: Zambia goes all in with proven tools to fight malaria-spreading mosquitoes, helping more children reach their fifth birthday. MEXICO & CHILD HEALTH: Concrete flooring in poor households makes Mexican children healthier, and even their mothers become measurably happier. Get the case here. KENYA & WORMS: School-based treatment gives millions of Kenyan children a worm-free childhood, with lifelong benefits for their health and livelihoods. HAITI & POLIO: Relying on proven tactics, Haiti goes school-to-school and house-to-house to vaccinate kids and halts a polio outbreak. Get the case here. BANGLADESH & INFANT MORTALITY: In Bangladesh, a package of proven interventions falls short on effectiveness at scale and fails substantially reduce under-five deaths.

Expanding Access to Health Services

THAILAND & UNIVERSAL HEALTH CARE: Despite political upheaval, Thailand manages to roll out universal access to essential health services at zero cost. Babies become healthier, workers are more productive, and households reduce financial risk. Get the case here. ARGENTINA & NEONATAL MORTALITY: Through a structured system of incentive payments, Argentina’s national government works with provincial authorities to take on a spiraling health crisis for newborns. Get the case here. BRAZIL & HEART DISEASE: Elevating high-quality primary care from the sidelines to center stage, Brazil cuts deaths from heart disease and reduces unnecessary hospital visits. Get the case here. RWANDA & CHILD HEALTH: Paying providers for results gets results: increased use of health services, and growth and weight gain for Rwanda’s children. INDIA & CHILD HEALTH: Gujarat takes on maternal and neonatal mortality by paying private doctors to offer hospital-based delivery, but the program doesn’t reach the poor who need it most and fails to improve health.

Using Targeted Cash Transfers to Improve Health

KENYA’S AIDS ORPHANS: Cash transfers give a helping hand to caretakers of ultra-poor and vulnerable Kenyan children, generating major reductions in risky behaviors and better mental and physical health. Get the case here. PAKISTAN & REPRODUCTIVE HEALTH: Conditional cash transfers help Punjabi girls stay in school, empowering them to marry later and avoid early pregnancies—good news for their reproductive health. Get the case here. SOUTH AFRICA & RISKY SEXUAL BEHAVIOR: In post-apartheid South Africa, cash grants help level the playing field for children living in poverty, improving their nutrition while reducing early pregnancy and risk behaviors. Get the case here. HONDURAS & INSTITUTIONAL DELIVERY: In Honduras, cash transfers help families access health services but don’t improve health.

Changing Behavior Population-wide to Reduce Risk

THAILAND & TOBACCO CONTROL: Thailand cuts smoking by a quarter after taking on transnational tobacco with tax hikes, health warnings, and new laws and restrictions. Get the case here. VIETNAM & TRAUMATIC BRAIN INJURY: Complying with a new law and stepped-up enforcement, Vietnam’s motorcyclists don helmets and prevent traumatic brain injuries. Get the case here. INDONESIA & OPEN DEFECATION: Triggered by a call to action, Indonesian communities band together to eliminate open defecation and reduce diarrheal disease. Get the case here. INDIA & HIV: In India, targeted community outreach and health services for the most at-risk affected populations help stem the spread of HIV. Get the case here. PERU & SANITATION: A handwashing campaign in Peru gets mothers to lather up but fails to clean up the burden of fecally transmitted diseases.  About the Center for Global Development

CGD works to reduce global poverty and inequality through rigorous research and active engagement with the policy community to make the world a more prosperous, just, and safe place for all people. As an independent, nonpartisan, and nonprofit think tank, focused on improving the policies and practices of the rich and powerful, the Center combines world-class scholarly research with policy analysis and innovative outreach and communications to turn ideas into action.

December 10, 2015

Which Wealthy Countries Have the Best and Worst Development Policies? United States Ranks 21st of 27 in Annual Commitment to Development Index

For Media Inquiries Kate Wathen Media Relations Coordinator (202) 416-4040 kwathen@cgdev.org

The Center for Global Development today released the Commitment to Development Index (CDI), the annual barometer of how the policies of wealthy countries help or hurt the world’s poorest people.

Main Findings of CDI 2015 Denmark has the most development-friendly policies, for the 4th year in a row. The UK is the highest ranked G7 country, at no.6. South Korea, Japan are at the bottom of table. The US ranks poorly – 21st out of 27. How the CDI Works

Each year, the CDI ranks 27 of the world’s richest countries according to their performance in seven policy areas – aid, trade, finance, migration, environment, technology and security. CGD works year-round to collect millions of data points for more than a hundred different indicators to understand better how rich countries’ policies impact developing nations. It reminds us that development depends upon much more than aid. Doing better in these policy areas would not only improve conditions for the world’s poorest people, but in most cases would also benefit the rich countries too. Most countries do well in some categories but badly in others. The CDI provides valuable information to these countries about which policy areas they could focus on to make more of a difference to the lives of the global poor while benefitting their own economies.

“The global goals show us there’s now a consensus that all countries should work together to bring about sustained, shared prosperity,” said Owen Barder, senior fellow, director and vice president, Center for Global Development Europe. “Development-friendly policies on trade, transparency, the environment and in many other areas are a win-win for both rich and poor. The CDI helps policymakers understand where their countries can do better.”

The CDI and the Global Goals

Following the adoption of the Sustainable Development Goals (SDGs) in September, the CDI is a report card for the world’s richest countries which shows how well they are doing to help all countries make progress on the SDGs – and how to do better.

The CDI & the United States

The United States could do much more to help developing countries achieve the Sustainable Development Goals. In 2015, the U.S. ranks in only 21st place, with its policies around migration, finance and the environment dragging it towards the bottom of the table. While the U.S. gives the most foreign assistance overall, the money spent only represents 0.18 percent of the country’s national income (by comparison Luxembourg and Norway, the most generous aid donors, give more than 1 per cent of their national income in foreign assistance each year). U.S. policies towards the environment have also contributed to the poor ranking, as it is one of the biggest emitters of fossil fuels per capita and is only one of two CDI countries not party to the Kyoto Protocol.

Who Did Best Scandinavian countries did the best overall, with Denmark, Sweden and Norway taking the top three spots. Denmark came out on top with some of the best policy rankings for aid, technology, trade and security; Norway ranked highest for polices related to migration, security and finance. Of the G7 largest economies in the world, the highest ranked are the United Kingdom (which does well on trade and security) and France (which does well on technology transfer and security).   Slovakia remains at the top of the environmental standings, with gasoline taxes among the highest in CDI countries and greenhouse gas emissions among the lowest, but its weak performance in other areas drags down its ranking to 23rd of 27. Who Could Do More The CDI shows that ALL rich countries could do more to help people in the developing world, in ways that would also benefit their own citizens. While both countries are scored highly for policies which promote technology, Japan and South Korea are at the bottom of the table because they score poorly on security, trade, and the environment The United States’ policies on finance, environmental, technology and aid pull it down to 21st place. While Canada ranks well for its support for investment and migration, it performs less well on the environment which brings down its overall ranking to 11th place. About the Center for Global Development

CGD works to reduce global poverty and inequality through rigorous research and active engagement with the policy community to make the world a more prosperous, just, and safe place for all people. As an independent, nonpartisan, and nonprofit think tank, focused on improving the policies and practices of the rich and powerful, the Center combines world-class scholarly research with policy analysis and innovative outreach and communications to turn ideas into action. Learn more at www.cgdev.org.

November 16, 2015

Nancy Birdsall to Step Down as CGD President

The Center for Global Development today announced that Nancy Birdsall is to step down as president in 2016, once a successor is in place. Birdsall, CGD’s founding president, will stay with the Center as a senior fellow.

“This is an exciting moment for me and for CGD,” said Birdsall. “The Center, though still youthful and disruptive, is in fact a mature and established institution. And the key to CGD’s success has always been hard-wired into its culture: a value-driven ‘think and do’ approach based on top-grade research and practical ideas. That’s bigger than any one person. Knowing that makes me confident that this transition will inspire change along with continuity.”

Birdsall, a former executive vice president at the Inter-American Development Bank and head of the World Bank policy research department, co-founded the Center in 2001 to analyze how the policies and actions of rich country governments and international financial institutions affect people in the developing world.

Under Birdsall’s leadership, CGD has attracted a cadre of intellectual heavyweights and leading development practitioners, and the work of CGD experts has been included in dozens of practical policy solutions, including Advance Market Commitments to accelerate vaccine development; Development Impact Bonds to attract private finance into development programs; Cash on Delivery payments to make aid more effective; a deal to reduce Nigerian debt by $30bn; and the creation of the International Initiative for Impact Evaluation to generate more evidence-based development solutions.

CGD’s board chair, former US Treasury secretary and Harvard University president emeritus Lawrence Summers, will head the search committee and the global search process to find Birdsall’s successor.

“Nancy has built an exceptional group of scholars who make a real difference to development policy around the world,” said Summers. “Our task now is to find another outstanding leader worthy of CGD; someone who also values rigor, evidence, and intellectual collaboration; who will enhance its formidable reputation as a policy crucible; and who will continue its mission to reduce global poverty and inequality.”

The firm of Russell Reynolds has been engaged to work with the search committee to conduct the global search for Birdsall’s successor. Enquiries should be directed to Jamie Hechinger

August 24, 2015

New Research Shows Forests Will Disappear Faster Than We Thought: Now is the Time to Put a Price on Carbon, Experts Say

WASHINGTON – The Center for Global Development (CGD) Cmd+Click or tap to follow the link">released a working paper today showing that tropical forests – whose preservation is thought to be one of the quickest, most affordable way to mitigate climate change – will disappear faster than we thought.

If the world doesn’t act:

By 2050, an area of tropical forest the size of India will have been cleared – 289 million hectares, or roughly one-third the size of the United States. By 2050, we’ll burn through one-sixth of our remaining carbon budget – the amount of emissions we have left in order to keep global temperature rise below 2° Celsius, thus avoiding dangerous climate change, according to the UN.

Using the most sophisticated satellite imagery available to study tropical forest data from more than 100 countries, CGD research fellow and environmental economist Jonah Busch and research associate Jens Engelmann have projected a pattern of deforestation more dire than previous research suggested. Their findings show emissions from deforestation will climb steadily through the 2020s and 2030s before accelerating around 2040.

Much of the devastation the research predicts can be avoided if the world puts a price on carbon, either through taxes, payments for emissions reductions or a combination of both.

VIDEO: Jonah Busch Explains Carbon Pricing

Three ways the world can act:

International carbon payments. If rich countries pay tropical countries for keeping forests standing, rich countries fight climate change more cheaply while tropical countries receive a new, green source of income that could be used to alleviate poverty. Carbon prices. If developing countries introduce a price of $20-per-ton of carbon dioxide on deforestation, emissions would drop by more than 20 percent by 2020; a $50-per-ton price would cut emissions nearly in half by 2050. Restrictive policies on deforestation. If developing countries introduce restrictive policies on deforestation backed by satellite monitoring and law enforcement, they can have a drastic impact on emissions (Brazil imposed restrictions on deforestation in the Amazon, and as a result, deforestation fell by 80% within a decade while soy and cattle production rose).

“Conserving tropical forests is a bargain,” explained Busch. “Reducing emissions from tropical deforestation costs about a fifth as much as reducing emissions in the European Union.”

"The Paris climate agreement needs to provide funding and other resources to stop tropical deforestation,” said Engelmann. “A climate agreement without robust action on forests will simply not be enough."

About the Center for Global Development

CGD works to reduce global poverty and inequality through rigorous research and active engagement with the policy community to make the world a more prosperous, just, and safe place for all people. As an independent, nonpartisan, and nonprofit think tank, focused on improving the policies and practices of the rich and powerful, the Center combines world-class scholarly research with policy analysis and innovative outreach and communications to turn ideas into action. Learn more at www.cgdev.org.

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