“There has been a broad recognition amongst economists that “institutions matter”: poor countries are not poor because they lack resources, but because they lack effective political institutions”. Francis Fukuyama, the Origins of Political Order, Vol 1 (2009)
For development professionals, there is no getting away from the fact that politics shapes the environments in which we work—that our programs can and do fail when we don’t take politics into account. But despite growing evidence that political economy analysis (PEA) can contribute to new ways of working and ultimately better results, the politics agenda remains what Thomas Carothers calls an “almost revolution” in mainstream development practice.
There are many factors at play: limited staff capacity to engage with politics, bureaucratic incentives to meet lending targets, a preference for best practice solutions and institutional blueprints. Many continue to argue that it is not the business of development banks or aid agencies to analyse politics, let alone act on key findings. This resistance is posited on several arguments—or myths—which I address below.
With the support of the World Bank, the Government of Vietnam is making strides in addressing fraud and corruption risks in the management of development loans more broadly than before. Thanks to a new strategic action plan that cuts across the national, sectoral, and project levels.
The World Bank’s Governance Global Practice is working with the government of Vietnam to design and implement this new strategic action plan on how to make the management of Official Development Assistance (ODA) loans less liable to fraud and corruption. As a result, a healthy public policy debate around the risks surrounding ODA loans and how best to address them has arisen in Vietnam, as shown by the last session of its National Assembly in 2014.
Managing large civil works contracts can be a challenge.
In Vietnam, while most large infrastructure projects are financed by multilateral and bilateral development partners under the form of Official Development Assistance (ODA), their implementation is contracted out and often delayed by cost overruns and quality concerns.
Give people the ability to engage, and they will change the world. Or will they?
The massive expansion of political voice and social activism over the past several decades -- ranging from the mushrooming of citizen-led initiatives for transparency and accountability, to the uprisings in the Middle East and North Africa, and the eruption of protest movements in countries as diverse as Brazil, India, Turkey and Mexico – has generated great enthusiasm about the transformational potential of popular participation.
The reality, however, is more complex than that.
Think back to the Arab Spring and the extraordinary mobilization of so many people who managed to topple one authoritarian regime after another. The streets were theirs, but in most of these countries ousting dictators has turned out to be much easier than building political systems that are more democratic and open for citizens to engage. While much in demand,
I recently prepared a module on Citizen Engagement and Development Outcomes for a Massive Online Open Course (MOOC) on “Engaging Citizens: A Game Changer for Development?”, just launched by the World Bank Group and partner organizations in both Washington, DC and London.
Two decades ago, when I interned at the French Embassy’s economic mission in Moscow, I was asked to look into bankruptcy laws and their implementation. The Embassy wanted to advise French companies on how to get business done in the new Russia—we are talking mid-1990s—when there were no reliable guidebooks on how to navigate the transition to a market economy.
So I was asked to read recently approved, Western-inspired bankruptcy laws, given a phone book and asked to find two dozen companies around Moscow. I was to meet with their CEOs and find out how insolvency and bankruptcy procedures actually worked in practice.
I came away with one key finding: In fact, the distortions brought about by hyperinflation, bartering and the transition from Soviet to Western accounting meant the liquidity and solvency ratios that underpinned the institution of bankruptcy had essentially become meaningless.
The Middle East and North Africa (MENA) is a rising middle-income region, and its citizens rightly expect quality public services. Yet too often they experience disappointment: students attending local schools are insufficiently prepared for the 21st century economy, and those needing health care too often find public clinics with no doctors or medicines.
Few in positions of authority are held accountable for such shortcomings. This situation both undermines the potential for improvement and heightens people’s unhappiness with the delivery system.
I’ll admit there was a tiny part of me that wanted to do that whole Angelina Jolie thing – go deep into the heart of a developing country and be surrounded by a gaggle of school children, whom I would go on to pinch, squeeze, and coddle. Last I checked I was not an UNHCR ambassador (and zero movie credentials), so instead I found myself face to face with four resolute high school students in the western region of Cameroon asking in broken French: What does corruption mean to you?
“It means to give money, to be sexually harassed, to be absent from school and then to pay teachers to say you were present,” said Floriane Masso, a student of a government school of Bamendjou. Masso is one of many students who are part of Clubs d’Education Civique et d’Integration Nationale (Cecine) established under the ZENU Network. With financing of about $15,000 from a Development Marketplace competition organized under a $1.8 million “Banking on Change” Governance Program in Cameroon--funded by the Governance Partnership Facility (GPF)—the ZENU Network set out to fight corruption in 16 high schools across 8 districts in the Western parts of Cameroon. One of the tools used were to put in place “corruption observatories.” The activity focused on victims of corruption and provided a whistleblowing mechanism, while pressuring authorities to impose sanctions for corrupt behavior.
“When one woman is a leader, it changes her. When more women are leaders, it changes politics and policies,” says Michelle Bachelet, the president of Republic of Chile. It’s true.
Over the last few decades, the world has seen an increase in number of women leaders. It’s key to our progress.
For the first time in history, the majority of people now live in cities, and . This rapid urbanization is a phenomenon almost entirely concentrated in developing and emerging countries- in fact, , and at a much faster pace than developed countries urbanized in the past.
What does this ‘metropolitan century’ mean for cities, governance, and development?
From a business perspective, local disputes can lead to more than US$20 million per week in losses for large-scale mines. To say nothing of the broader costs – in terms of lives lost and development stymied – when local discontent develops into violent conflict.
In response, a growing number of mining companies and governments have rolled out “Community Development Agreements” (CDAs), an umbrella term covering formal arrangements for local development between a company and designated communities. CDAs can run the gamut of the community-company relationship, including among other areas, socio-environmental impacts, benefit sharing, employment, monitoring and grievance redress.
CDAs have spread quickly in national law and policy. with nine countries currently in the process. The CDA model, it seems, is an emergent “best practice” and initiatives ranging from the Ruggie Principles to the International Council on Mining and Metals have reiterated their value.