Mexico’s financial risks and the policies being adopted by the new administration cannot be adequately assessed without recognizing key features that characterize certain initial conditions.
With the Doha Round dead if not buried, the United States has no excuse for not acting on its rhetoric and providing improved market access for all of the world’s least developed countries.
Unlike East Asia and Europe, Latin America lacks a shared integration strategy and continues to struggle with a burdensome investment climate. In this new CGD Note, visiting fellow Nancy Lee suggests a fresh approach to regional integration in the form of a proposed regional investment agreement. The idea is a collective effort to set common standards for reducing specific barriers to domestic and foreign investment. Beyond its benefits for growth, such an agreement could boost the incomes of the poor by helping small businesses trapped in the informal sector move into the more productive formal sector.
With President Bush's trip to Africa making headlines this week, CGD senior fellow Steve Radelet and research assistant Sami Bazzi offer a close look at the latest U.S. foreign assistance numbers. Bottom line: although America's aid has more than doubled since 2000, the new money went mostly to Iraq, Afghanistan and a small number of debt relief operations; and almost all was allocated through bilateral rather than multilateral channels. Assistance to Africa more than quadrupled from $1.5 billion in 1996 to $6.6 billion in 2006 and has been enormously important in funding humanitarian relief and HIV/AIDS programs. But even with the increases, U.S. assistance to Africa still averages less than $9 per African per year. And U.S. assistance for Africa has become less selective: since 2000 the shares going to the poorest countries and to the best-governed countries have fallen.
A White House conference on social justice in Latin America this week may signal a shift to U.S. engagement with the region that goes beyond security, free trade, and anti-narcotics efforts. CGD president Nancy Birdsall and Peter Hakim, president of the Inter-American Dialogue, suggest seven ways that the U.S. could more effectively support Latin American efforts to address persistent inequality--starting with a more effective approach on trade and drugs.
Will the Poor Be Flooded Out? The IPCC's Predicted Flood Disasters and Their Implications for Development Aid
The April 5, 2007 Intergovernmental Panel on Climate Change (IPCC) report predicts that droughts and floods will become more frequent and severe as a result of global warming. In this CGD Note senior fellow David Wheeler shows that citizens of poor countries are much more likely than citizens in rich countries to suffer homelessness, injury and death from flood. He urges the international community to help low-income countries develop stronger protective institutions, greater resources for flood protection, and affordable insurance.
U.S. aid to Africa soared during President Bush's first term, to more than twice the level of any previous administration. But the newly divided government--Democratic Congress, Republican White House--could mean a cut in aid. In this CGD Note senior fellow Todd Moss uses just-released data from the first term of the Bush administration to explore patterns in U.S. official development assistance. He finds that aid to Africa is higher when the same party controls both the White House and Congress and that an all-Republican government gives more aid than an all-Democratic one.
Read Moss' 2003 Surprise Party working paper
Diamonds, long seen as symbols of love and prosperity, are now blamed for war and corruption in some of the poorest places on earth. But do all diamonds fuel conflict and strife? In this CGD Note program associate Kaysie Brown and senior fellow Todd Moss consider the strengths and limitations of industry efforts to break the deadly link between diamonds and conflict, most notably through the Kimberley Process, which certifies that a diamond has been obtained legitimately. They find that the Kimberley Process, which has helped turn conflict diamonds into development diamonds, is a good thing but it could be even better. They also offer consumers tips on how to buy conflict-free diamonds.
China's bid for a leading role in Africa gained sudden visibility on the weekend with an unprecedented gathering of leaders from 48 African countries in Beijing. Chinese president Hu Jintao pledged to double aid and to offer $5 billion in loans by 2009. China's newly high-profile overtures towards Africa have raised eyebrows—and a fair bit of anxiety—among Africa’s traditional development partners. Will Chinese lending lead to a new African debt crisis? In a new CGD Note, senior fellow Todd Moss and research assistant Sarah Rose examine the growing clout of a little-known instrument of China's Africa policy, the Export-Import Bank of China, and offer some advice for the West. Learn more
In this CGD Note, CGD vice president Dennis de Tray and senior fellow Todd Moss argue that international financial institutions should transform their boards of resident executive directors into non-resident, non-executive bodies. Doing so would force the governing bodies to focus on their core responsibilities, increase accountability and reduce costs of all kinds. They urge the African Development Bank to go first. Learn more
The Investment Climate Facility (ICF) for Africa was launched in June to help Africa tackle problems that hinder domestic and foreign investment. It aims to raise $550 million for promotion of property rights and financial markets, anti-corruption efforts, and reform of regulations, taxation, and customs. In this CGD Note, senior fellow Todd Moss lists the strengths of the proposal and asks tough questions, including: What exactly will the money be spent on? Why no independent evaluation? He concludes that the U.S. should support the facility--if convincing answers are forthcoming. Learn more
Before the G-8 Summit, President Bush said that U.S. aid to Africa had tripled since he took office and would double again by 2010. CGD’s Steve Radelet and Bilal Siddiqi find that total U.S. aid to the region has doubled, but not tripled, since 2000, continuing an upward trend that began in 1996. Going forward, the pledge to double aid implies an additional $4.3 billion in aid to Africa by 2010, accounted for by projected increases in the Millennium Challenge Account ($2.0-$2.5 billion), the global AIDS program (PEPFAR) ($1.5 billion), and the recently announced malaria program ($0.5 billion). The pledge to double aid should be seen as a recommitment to previous (important) pledges, rather than an announcement of something new.
Nigeria has $33 billion in external debt. The government has been trying unsuccessfully for years to cut a deal with creditors to reduce its external obligations but to date has only managed to gain non-concessional restructuring. The major creditors also have good reasons for wanting to seek a resolution, yet agreement has been elusive. Fortunately, there is a brief window of opportunity in 2005 to find a compromise that can meet the needs of both sides. This note briefly outlines a proposal for striking such a deal through a discounted debt buyback.