Policy Updates

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Analysis of ODA spending allocations by UK’s Department for International Development and Foreign and Commonwealth Office suggests merger will shift UK's development priorities

A new report by Development Initiatives, an international development data organization based in the UK, has warned that the planned merger of the UK’s Department for International Development (DFID) with the Foreign and Commonwealth Office (FCO) could shift the focus of the UK's official development assistance (ODA) away from poverty, gender, and fragile states. It also raises concerns about declining transparency as a result of the merger.

The report draws on data analysis of ODA spending allocation over the last five years by the FCO and DFID to examine how a greater alignment of UK ODA spending with foreign policy objectives might impact on future UK ODA allocations.

The analysis revealed stark differences in spending patterns across the two departments:

  • The FCO allocated 78% of its ODA to middle-income countries between 2014-2018 and 74% of its ODA over the to countries where less than 5% of the population lived in extreme poverty. In stark contrast, DFID allocated 61% of its ODA to countries where over 20% of the population live in extreme poverty, and over half of its ODA to low-income and least developed countries.
  • The FCO allocated less than half of its ODA (41%) to fragile states. In contrast, 88% of DFID ODA went to fragile states.
  • The FCO does not report on how much of its ODA is allocated to supporting gender equality. In contrast, gender equality is an important priority for DFID with over 61% of its ODA going to projects focused on gender equality in 2018.
  • In 2020 an assessment by Publish What You Fund, an independent assessor of development assistance transparency, deemed the FCO's transparency ‘fair’, while DFID ranked among the most transparent donors in the EU and third most transparent in the world.  

The report recommends that the UK legislation which requires UK ODA to be allocated for poverty reduction and gender equality, which currently only applies to DFID and not to other spending departments, be applied to all ODA spending by all departments. The report also recommends maintaining DFID expertise within the new department and establishing a new cross-government ODA committee.

Report – Development Initiatives

US Senate debates COVID-19 response, WHO withdrawal decision

The US Senate Foreign Relations Committee held an, at times contentious, committee hearing on June 19, 2020, covering topics including the delay in spending of the supplemental appropriations passed by Congress in March and the US decision to withdraw from the World Health Organization (WHO). Both the State Department and the US Agency for International Development (USAID) appeared before the committee to answer questions about the administration's budget proposal. Secretary of State Mike Pompeo did not appear, a move which was criticized by Senator Bob Menendez, the ranking member of the committee.

Some of the debate focused on the administration's global health security proposal, which aims to move most global health programs out of USAID and into the State Department. Senator Menendez was sharply critical of the idea, expressing concern about the impact on USAID's ability to effectively do its work.

Chairman Risch diverted from the usual Republican criticism of the WHO to offer support for the work of the UN agency. Although the WHO needs some reforms, he said, the WHO does "some great work" and noted that he had talked directly to the WHO leadership to encourage changes to pandemic responses.

Senator Menendez asked the Health and Human Services (HHS) representative why the WHO should listen to the US, given its decision to withdraw. According to HHS, the US is still a member of WHO and is coordinating with other G7 ministers on the COVID-19 response.

News article - Devex

Japan supports construction of Afghanistan's first private sector gas-fired power plant

Along with the Asian Development Bank (ADB), the Japan International Cooperation Agency’s (JICA) Leading Asia’s Private Infrastructure Fund (LEAP) will support the construction of a 58.56-megawatt gas-fired power plant in Mazar-i-Sharif in northern Afghanistan. According to the ADB and JICA, the gas-fired power project aims to source gas locally and reduce electricity imports, as well as attract more private sector investment and financing.

Afghanistan has the world’s lowest electricity penetration rate of 34%. According to JICA, while energy demands have been growing at nearly twice its economic growth rate, Afghanistan remains highly dependent on energy imports from neighboring countries, which consists of at least 75% of its power.

The ADB and JICA have each committed loans of US$10 million for the project. Private sector sponsors include the Ghazanfar Group (of Afghanistan) and Hassan Allam Holdings (of Egypt) will participate as sponsors, and the International Finance Corporation (IFC) and Deutsche Investitions- und Entwicklungsgesellschaft mbH (DEG) will provide additional finance. 

JICA has approved US$1.5 billion investment in the LEAD Fund and financial assistance totaling US$500 million since the fund's launch to support high quality infrastructure projects. 
    
Press release - Japan International Cooperation Agency

Japan International Cooperation Agency launches US$214 million in non-guaranteed domestic bonds

Japan's International Cooperation Agency (JICA) has launched ¥23 billion (US$214 million) in non-guaranteed domestic bonds in two tranches: ¥10 billion (US$93 million) with a 10-year maturity and ¥13 billion (US$121 million) with a 20-year maturity. 

The International Capital Market Association (ICMA) has dubbed these “Social Bonds”, which are qualified by the Japan Research Institute. These bonds are expected to support projects contributing to the Sustainable Development Goals (SDGs).

Press release – JICA

Spanish Foreign Affairs Minister announces Spain's ODA will increase to 0.5% GNI by 2023

The Spanish Minister of Foreign Affairs, European Union and Cooperation, Arancha González Laya, has announced that Spain’s official development assistance (ODA) will increase to 0.5% of its gross national income (GNI) by 2023. The announcement was made at the Spanish Congress of Deputies' development commitment hearing which was aimed at reviewing the Spanish government’s plans for development cooperation during the current legislature. 

Minister González Laya announced that Spain’s development policy has been restructured to support low- and middle-income countries in addressing the COVID-19 crisis. Accordingly, key development priorities will include:

Vertical priorities

  • Global health, nutrition, water, and sanitation;
  • Climate change;
  • Education; and
  • Socioeconomic progress.

Horizontal priorities

  • Feminist development policy;
  • Human rights;
  • Humanitarian assistance; and
  • Innovative partnerships.

Minister González Laya also presented Spain's 'Joint Response Strategy', a strategic plan aimed at responding to COVID-19 globally. This plan will focus Spain’s development efforts on humanitarian and emergency assistance, multilateralism, and capacity building in partner countries.

Press release – Cooperación Española, MAEUEC (in Spanish)

Bill and Melinda Gates criticize US' lack of leadership on COVID-19 response

Speaking before a group of over 200 philanthropists, both Bill and Melinda Gates criticized the US' global response to COVID-19. In particular, they called out the US for its decision to withdraw funding from the World Health Organization (WHO) and for stepping away from its traditional leadership role in helping to find global solutions to the world's largest problems.

One of their chief concerns was ensuring that after a COVID-19 vaccine is developed it does not go to the highest-bidder countries. They emphasized the importance of ensuring that any newly developed vaccine goes first to those most in need, including health care workers and vulnerable populations. 

It is estimated that the world will need 10 billion doses to innoculate 80% of the world's population through a two-shot vaccine. The Gates Foundation will work with both the Global Fund to Fight AIDS, Tuberculosis and Malaria as well as Gavi, the Vaccine Alliance, to try to ensure equitable distribution of any vaccine.

News article - Forbes

UK Foreign Secretary commits to ensuring ODA retains strong focus on poor and fragile countries, but key oversight mechanisms in jeopardy

The UK's Foreign Secretary, Dominic Raab, has committed to parliamentarians that the government will ensure that the share of the UK’s ODA spent on poor and conflict-affected countries is maintained by the new department for Foreign, Commonwealth and Development Affairs (FCDO). The UK spends more than 50% of its ODA in fragile states and over half in low-income countries.

Last week, Raab was appointed by the Prime Minister to head the new FCDO, after the announcement was made that the UK’s Department for International Development (DFID) would be merged into the UK Foreign and Commonwealth Office. According to the government's plan, the merger will take place over the summer and the new department will be up and running in September 2020.

Raab, however, failed to answer questions from parliamentarians regarding whether the UK's development assistance watchdog (the Independent Commission on Aid Impact, ICAI), will be preserved despite the merger. Raab only said that scrutiny of the ODA budget will be maintained if not increased under the FCDO. Many parliamentarians are concerned about the future of ODA oversight, especially since Raab has already written to the Chair of the UK parliamentary body (the International Development Select Committee), to ask that the Committee be closed down to enable the Foreign Affairs Committee to take up scrutiny of development assistance.

Parliamentarians have yet to vote on the issue. A cross-party letter from more than 70 members of the UK Parliament has called for the International Development Select Committee to be kept alongside the IACI to ensure maximum oversight.

News article - Devex

News article - The Guardian

As Germany takes reigns of EU Council Presidency, Merkel says solidarity will be her guiding principle

In a speech in the German Parliament on June 18, 2020, German Chancellor Angela Merkel outlined her vision for Germany’s Presidency of the EU Council, which Germany will hold for six months beginning on July 1.

The presidency will focus primarily on recovery from the COVID-19 crisis and making the EU more resilient against future crises. In order to achieve these goals, Merkel said, change and progress must be accelerated within the EU. Solidarity, Merkel emphasized, is the only way for the EU and the globe at large to recover from the pandemic. This belief will serve as the guiding principle for the German Council Presidency.

In addition to efforts against COVID-19, Merkel mentioned three other priority areas:

  1. Climate protection and the transition to a climate-neutral economy;
  2. Digitalization of the economy and society; and
  3. Greater global responsibility for Europe.

With a view to foreign policy, Merkel said her agenda would focus on joint management of the pandemic and on shaping relations with the African continent in a spirit of partnership. The world needs "Europe's strong voice for the protection of human dignity, democracy, and freedom," she said. Merkel also highlighted the Conference on the Future of Europe, which is now set for September 2020, as a potential forum in which to discuss reform proposals, for example, in foreign and security policy.

Merkel will also work towards ensuring that the European Council reaches an agreement on the Multiannual Financial Framework (MFF) and the Reconstruction Fund as soon as possible.

News article – euraktiv

News article – Süddeutsche Zeitung (in German)

Leading Dutch think-tank hosts webinar with global players in international COVID-19 response

On June 18, 2020, the Netherlands Institute of International Relations Clingendael hosted a webinar with some of the most prominent players in the international COVID-19 response, including the Global Financing Facility (GFF), the World Health Organisation (WHO), and the Bill and Melinda Gates Foundation.

The organizations explained their distinct roles and described their efforts to tackle the pandemic. The GFF emphasized their focus on ensuring that women and children have access to vital services, while the WHO described its role as normative, providing timely guidance to all states to enable them to respond adequately to the crisis, and convening the different partners for the development of a new vaccine. The Bill and Melinda Gates Foundation has committed €250 million (US$281 million) to combat COVID-19 and is deeply involved in research efforts to produce a COVID-19 vaccine that can be equitably distributed. 

Event website - Institute Clingendael

Norad report evaluates Norway's efforts to focus ODA on narrower thematic and geographic priorities

The Norwegian Agency for Development Cooperation (Norad) recently released a report evaluating the geographical and thematical concentration of Norway's Official Development Assistance (ODA). The evaluation is based on a political decision from 2013, in which the government, led by Foreign Minister Børge Brende, determined that Norway would increase the geographical and thematic concentration of its ODA. The aim of the resolution was to more clearly define Norway's goals and priorities while encouraging more cost-effective ODA-management. 

Between 2012 and 2017, Norway's ODA became more concentrated on a smaller number of partners and agreements; the number of development contracts declined rapidly while the volume of ODA increased. Nonetheless, the report concludes that no substantial geographic or thematic concentration of Norway's ODA spending was achieved.

Article – Norad (in Norweigan)

EU Council approves agenda for upcoming presidencies, including COVID-19 crisis response

Germany, Portugal, and Slovenia have officially released the agenda for their upcoming trio of presidencies of the Council of the EU over the next 18 months. 

Amidst other measures, the agenda prioritizes urgent and comprehensive action for addressing the COVID-19 crisis and calls for:

  • Supporting partner countries in strengthening their health systems and in mitigating the socioeconomic consequences of the pandemic;
  • Supporting the global COVID-19 response through collaboration on new diagnostics, therapeutics, and vaccines; and
  • Increasing cooperation in health-related processes.

The agenda includes other priorities such as on the long-term EU budget negotiations, Brexit, rule of law, climate, trade, research, and digitalization.

Agenda of upcoming presidencies - Council of the EU

Canada loses bid for UN Security Council seat

After an "intense and costly" effort, Canada failed to win a temporary seat on the United Nations (UN) Security Council. Instead, Norway (130 votes) and Ireland (128 votes) secured the two available spots. Canada obtained 108 votes, 20 short of what was required to win a seat.

Canada's Prime Minister, Justin Trudeau, issued a statement saying that Canadian values of "peace, freedom, democracy and human rights" were promoted throughout the entirety of the campaign and that the process allowed Canada to strengthen its bilateral relationships. Opposition leaders have been critical of Trudeau's approach. 

News article - CBC

Sweden contributes US$944 million in concessional funds to World Bank’s International Development Association

On June 17, 2020, the Swedish government approved a grant of SEK 9.2 billion (US$944 million) to the World Bank’s International Development Association (IDA) to be paid over a period of nine years.

IDA provides concessional loans or grants to the world's 72 poorest developing countries, with the aim of reducing poverty by boosting economic growth, reducing inequalities, and improving people’s living conditions.

“The contribution to IDA will be crucial for many poor countries as they tackle the impact of the COVID-19 crisis on public health, the economy, and the labor market," said Peter Eriksson, Minister for International Development Cooperation. "Sweden is IDA's eighth-largest donor and has played a significant role in shaping the work program, and thus what the money will be spent on, for the next three years.”

Press release – Government Offices of Sweden (in Swedish)

European Commission releases new EU vaccine strategy

The European Commission (EC) has released its proposal for an EU COVID-19 vaccine strategy. This strategy would enable the EC to jointly procure vaccines for all 27 EU countries, through advanced purchase agreements with producers manufacturing in the EU. The strategy aims to accelerate the development, manufacturing, and deployment of vaccines in the EU while avoiding competition among member states.
 
The strategy mentions global solidarity but lacks details on any specific provisions for equitable distribution outside of the EU. It does not explicitly state whether low- and middle-income countries (LMICs) could be included as a party to the agreements or whether a specific percentage of vaccine doses would be set aside for LMICs to purchase.

According to the strategy, the EU is ready to support global procurement processes, but how and when this would be done (e.g., through Gavi’s COVAX initiative or by creating a new mechanism) is unclear.
 
Communication - European Commission
 
Factsheet - European Commission
 
Press release - European Commission

Australia provides US$7 million for COVID-19 assistance in Indonesia and Laos

Australia will provide support for Indonesia’s COVID-19 response and recovery efforts through the World Health Organisation (WHO). This will strengthen Indonesia’s laboratories and the use of health information, as well as providing better protection for health workers and patients.

In Laos, Australia has increased its bilateral assistance program by almost 25% to help the government strengthen health systems, protect vulnerable citizens, and plan for economic recovery.

News article - The Jakarta Post

News article - The Star Online

Norway wins bid for UN Security Council seat

The United Nations (UN) General Assembly in New York has elected new members to the UN Security Council for the period 2021–2022. Norway was elected with 130 votes in the Western European and Others Group. 

Norway has been a strong financial and political supporter of the UN's work for peace, development, and human rights since its establishment. The Norwegian government has announced that they intend to give special priority to efforts aimed at strengthening the protection of civilians — including children — and at promoting women’s role and participation in international peace and security work. Furthermore, they wish to bring more attention to how climate change affects international peace and security.

Norway has been a member of the Security Council four times before, the last time in 2001-2002, and has experience from many years of engagement in peace and reconciliation efforts globally. 

Press release – Norwegian Government

Japan's Global Health Innovative Technology Fund opens call for proposals for infectious disease research and development projects

The Global Health Innovative Technology Fund, a Japanese non-profit, has announced a new request for proposals (RFP) for the development of novel drugs, diagnostics, and vaccines for malaria, tuberculous, and neglected tropical diseases. The projects will help address health-related challenges in low-income countries or will fill gaps in health technologies for infectious diseases.

Projects are set to last 2-years or less and may focus on an array of research and development activities, such as lead optimization, preclinical development, clinical development, or activities to support licensure and World Health Organization (WHO) prequalifications. Projects should include one eligible Japanese and one eligible non-Japanese organization.

Further details of the request for proposals are provided online. Applications are due July 29, 2020, and full proposals are due August 17, 2020.

Press release – Global Health Innovative Technology Fund

Japan provides US$12 million for medical equipment and human resource development in Mongolia

The Japanese Ministry of Foreign Affairs (MOFA) has announced US$9 million (¥1 billion) in support for healthcare and medical equipment to tackle COVID-19, as well as US$2 million (¥249 million) for human resource development to Mongolia. 

Mongolia has had a total of 197 cases of COVID-19 as of June 12, 2020, which is lower than most countries. However, the Japanese government views Mongolia as vulnerable to a pandemic due to the lack of healthcare infrastructure and medical equipment. Therefore, MOFA's funds will provide ambulances, high oxygen concentrators, and more to strengthen Mongolia’s healthcare system.

Japan has paired its support for Mongolia's healthcare system with human resource development among Mongolian government officials, in order to improve the ability of the Mongolian government to institute development projects. According to the Japanese governmnet, although its industry is diversifying, Mongolia lacks the government personnel capable of addressing emerging development issues. The funds provided will support human resource development by allowing young Mongolian government officials to obtain a degree from Japanese graduate schools. 

Press release – Ministry of Foreign Affairs (in Japanese)

In major blow to independent development assistance policy, UK's Department for International Development is merged into Foreign and Commonwealth Office

On June 16, 2020, the UK Prime Minister, Boris Johnson, announced that the Department for International Development (DFID) will be merged with the Foreign and Commonwealth Office (FCO) to create a new Foreign, Commonwealth and Development Office. Johnson said the merger was needed given the intensely competitive global geopolitical situation, citing the rising power of China in particular. He claimed that the new organization will enable the UK to fully unite its development assistance with its diplomacy efforts to bolster the UK's global foreign policy efforts.

The merger has been in the cards for some time; the Prime Minister publicly stated his support for the idea when he was Foreign Minister last year but the June 16 announcement has nonetheless taken many by surprise especially since it comes in the midst of the ongoing COVID-19 crisis. The decision was heralded as part of the government's ongoing integrated review of its foreign, defense, and development policy which has officially been put on pause due to COVID-19. 

In the past, NGOs in the development space have raised concerns that a merger could result in a less poverty-focused UK development program. These concerns will be heightened now, given that part of Johnson's explicitly stated rationale for the merger is the mismatch between how the UK currently directs its development assistance and UK diplomacy, foreign policy, and security goals. Johnson noted that DFID's budget is four times the budget for the FCO; DFID spends as much on assistance to Zambia as it does to Ukraine — even though Johnson claims the latter is vital for European security — and spends ten times as much on development in Tanzania than in six countries in the Western Balkans — countries which Johnson cited as vulnerable to Russian interventions.

Under the merger, the Foreign Secretary, Dominic Raab, will have the final say on what countries will receive UK development assistance and which will stop receiving it. A single UK strategy for each country will be overseen by the UK's National Security Council, which is chaired by the Prime Minister. In-country, all strategies will lead UK work at the country level and be implemented by UK Ambassadors.

The merger comes just one week after the UK cross-party parliamentary committee on international development called for the UK government to retain an independent DFID with a cabinet-level representative. The parliamentary committee’s interim report assessing UK development assistance effectiveness noted that a merger between DFID and the FCO had the potential to reduce the accountability of UK Official Development Assistance (ODA) and dilute the focus of UK ODA away from poverty reduction.

Press Release - UK Prime Minister's Speech to Parliament on DFID

News article - BBC

News article - The Guardian

News article - The Independent

South Korean government upgrades K-CDC to independent administrative agency

The South Korean government has announced that the Korea Centers for Disease Prevention and Control (K-CDC) will be upgraded from a center to an independent administrative agency after discussion and approval from the president’s office, government, and the ruling party.

The new K-CDC will still be affiliated with the Ministry of Health and Welfare but will retain under its purview many of the relevant research institutes including the Korea National Institute of Health as well as the research institute on infectious disease. The latter, which was the center for infectious disease control, will also be upgraded to a national research institute and will be the main agency dedicated to developing COVID-19 vaccines and therapeutics. With greater authority over its budget and personnel, the new K-CDC will also try to improve the health and medical research and development process.

News article – Money Today (in Korean)