Tag: Finance

 

Putting Foreign Aid Cuts in Context

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Put funding for the 150 account in context, and you better understand the broader trend and two crucial points: (1) the 150 Account is a tiny slice of the federal budget, so proposed cuts will contribute little toward shoring up much larger accounts like national defense; and (2) increases in foreign assistance over the past sixteen years have supported US development efforts in Iraq and Afghanistan, and helped deliver on a historic US commitment to fight global HIV/AIDS, particularly in Africa.   

Defending Development in a Time of Cuts—My Conversation with UNDP’s Helen Clark

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On the day the Trump Administration proposed considerable cuts to the US international affairs budget, including US funding for the UN, CGD hosted the outgoing head of the UN’s largest agency, UNDP Administrator Helen Clark. As she prepares to step down after eight years in the post, she will leave behind a UN system facing serious questions about its future capabilities and financing. That idea, in fact, informed the title of our event Facing Future Challenges on Uncertain Ground, the video of which you can watch here.

The Trump Administration Budget Wants to Shut Down OPIC. Instead, Super-Size It.

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The budget just released zeroes out the Overseas Private Investment Corporation, the nation’s development finance institution. In an era where many government agencies are under threat, it may not be surprising that OPIC would come under fire. Yet, none of the arguments often used to justify killing off OPIC are logical. Here’s why.

Does the US Interest Rate Rise Mean Trouble for Emerging Markets? Depends on Your Timeframe

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The rate is still very low at 0.75% in the US, and, in addition, there is no perception or expectation that rates are about to rise in other advanced economies such as Japan or the EU. Taken together then, interest rates in advanced economies look set to stay extremely low. So, for now at least, emerging markets may not need to worry too much about capital inflows drying up. But in the medium to long term a problem may loom for emerging markets.

A Key Question If You Are Reviewing Multilateral Organization Effectiveness: Do We Need a Multilateral Solution?

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There’s increasing appetite in the US to follow the UK model and launch a review of US spending through international organizations like the United Nations and the World Bank. There is a lot to be said for such an exercise—my colleague Todd Moss even carried out a mock version for the US a few years ago which suggested plaudits for Gavi and the African Development Fund alongside brickbats for the ILO and UNESCO. But I think the model has a serious weakness if it is going to be applied as broadly in the US as some proposals, including a draft executive order making the rounds, imply. I’d argue for (preferably) limiting the review to like-to-like comparisons covering aid and development institutions or (at least) using different criteria for judging the many different types of international organizations.

Demonetization Ushers in New Era of Digital Finance in India

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It has been more than 100 days since the Modi government declared that the two largest denomination notes in India—the 500 and 1000 rupee notes—would no longer be accepted as legal tender. The announcement of “demonetization” had an immediate and sweeping effect on Indian households, which were no longer allowed to use the notes (outside of a few narrow exceptions) and were given less than eight weeks to deposit or exchange them.

New Leadership at the IFC Aims to Get Us from Billions to Trillions

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This week, CGD hosted a discussion with Philippe Le Houérou, the CEO of IFC, the private sector arm of the World Bank. He was enthusiastic about his institution’s role in leveraging private capital and getting from billions to trillions of dollars for development, but he also presented a nuanced and critical judgment about the limitations of the IFC model to date, pointing to a number of ways it needs to change.

Criminal Finances: Should the UK Be Imposing Public Registers of Beneficial Ownership on Its Ex-Colonies?

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A new Criminal Finances Bill is making its way through the UK House of Commons which aims to make it harder for criminals and kleptocrats to use the UK financial system to launder ill-gotten gains, while minimising the burden on legitimate businesses and individuals. The bill gives expanded powers to law enforcement agencies and makes banks and other businesses liable for prosecution if they fail to prevent facilitation of tax evasion. It also introduces ‘Unexplained Wealth Orders’ (UWOs). These would allow the authorities to demand explanations about any assets that appear suspicious. These measures should have both domestic and international benefits in tackling illicit financial flows.

Aid in Reverse: Facts or Fantasy?

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A comment piece published in the Guardian earlier this week argued that for every $1 of aid that developing countries receive, they lose $24 in net outflows. The 1 to 24 figure is shocking and morally compelling. But it isn’t true.

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