Financing for the African Century
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THE 2017 DATA REPORT FINANCING FOR THE AFRICAN CENTURY THE 2017 DATA REPORT FINANCING FOR THE AFRICAN CENTURY CONTENTS 4 Acknowledgements 6 50 EXECUTIVE SUMMARY CHAPTER 4 COUNTRY PROFILES 52 Australia 16 54 Canada CHAPTER 1 56 EU Member States and Institutions OFFICIAL DEVELOPMENT 60 France ASSISTANCE 62 Germany 64 Italy 28 66 Japan CHAPTER 2 68 The Netherlands DOMESTIC RESOURCE 70 Sweden MOBILISATION AND ALLOCATION 72 The United Kingdom 74 The United States 38 CHAPTER 3 76 Methodology PRIVATE INVESTMENT FOR 84 Annex DEVELOPMENT IMPACT 90 Endnotes 3 ACKNOWLEDGEMENTS The ONE Campaign would like to thank its board members The following ONE staff and consultants contributed significantly and trusted advisors: Bono, Joshua Bolten, Susan A. Buffett, to the production of this report: Valentina Barbagallo, Meagan Joe Cerrell, Aliko Dangote, John Doerr, Jamie Drummond, Tom Bond, Rinze Broekema, Spencer Crawford, Kate Critchley, Nerida Freston, Helene D. Gayle, Morton H. Halperin, Mo Ibrahim, Ronald Dalton, Morten Emil Hansen, Galen Englund, Stephan Exo- O. Perelman, Sheryl Sandberg, Kevin Sheekey, Bobby Shriver, Kreischer, Nick Goetschalckx, Emily Huie, Ruba Ishak, Ruth Gayle Smith, Michele L. Sullivan, Lawrence Summers, and Mark Jackson, Mae Kurkjian, Serah Makka, Margo Matias Valencia, Suzman, as well as the members of ONE’s Africa Policy Advisory Megan O’Donnell, Franziska Perlick, Jacqueline Quinones, Board: Melvin Ayogu, Amadou Mahtar Ba, Owen Barder, David Ghazal Rahmanpanah, Amanda Robbins, Fiona Robertson, Barnard, Erik Charas, Romy Chevallier, Jacqueline Chimhanzi, Friederike Röder, Tahrat Shahid, Molly Shriver, Gabriele Simeone, Chose Choeu, Paul Collier, Mike Dada, Nic Dawes, Zohra Dawood, Kat Sladden, Kate Vang, and Emily Wigens. Aidan Eyakuze, Eleni Z. Gabre-Madhin, Neville Gabriel, John Githongo, Chikwe Ihekweazu, Angélique Kidjo, Warren Krafchik, The statisticians at the OECD Development Cooperation Mpule Kwelagobe, Acha Leke, Xiaoyun Li, Bunmi Makinwa, Susan Directorate provided the data which made this report possible. Mashibe, Richard Mkandawire, Rugemarila Mutahaba, Jackie We are fortunate to have received comments and feedback on Mutambara, Archbishop Njongonkulu Ndungane, Irene Odida, drafts of the profiles from governments; any errors are our own. Catherine Chichi Okoye, Oluseun Onigbinde, Arunma Oteh, Mandla Thanks go to our copy-editor David Wilson. The report’s design Sibeko, John Ulanga, Russell Wildeman, and Yakubu Lai Yahaya. and art direction were guided by Nicolette Cornelius and Kendall The report’s direction, data analysis, writing and editing were Kiernan of Orange Element. led by Kerezhi Sebany, under the guidance of Sara Harcourt and David McNair. Yesl Kang and Isabelle de Lichtervelde were contributing writers and analysts. Margaret Grace managed the report’s production. 4 To the millions of people who work and campaign tirelessly for the end of extreme poverty, Your perseverance and commitment are truly inspiring. ERRORS AND OMISSIONS This report went to print on August 28, 2017. The information it contains was, to the best of our knowledge, current up until this date. We acknowledge that events that occurred after this point may mean that some of the information in this report is out of date. 5 6 EXECUTIVE SUMMARY In 1990, approximately 35,000 children on average died every day from preventable and treatable diseases. Twenty-five years later, that number has been nearly cut in half and over 18,600 fewer children die each day from these causes.1 Over this same period, nearly 1.1 billion people worldwide have been lifted out of extreme poverty.2 A remarkable partnership between aid donors, foundations, government leaders, civil society, and private sector innovation has been fundamental to these achievements. In light of this, record aid levels in 2016 should be a welcome sign, particularly when many donor countries are facing growing calls to prioritise domestic agendas. But as with most trends, global progress masks deep inequalities amongst the beneficiaries of resources and the quality of financing. A number of the very poorest countries are struggling to realise the same global progress. These countries never met most of the Millennium Development Goals (MDGs), whose deadline for delivery was 2015, and are starting off on the back foot to achieve the Sustainable Development Goals (SDGs) by 2030. Some countries have slid backwards after new shocks, such as the commodities price crash or repeated droughts induced by extreme climate, have damaged their progress. The least developed countries (LDCs) and fragile states, the majority of which are in Africa, deserve particular attention as they have some 7 of the highest poverty levels and the fewest This is a pivotal time to reverse these negative progress on global aid and aid to the poorest resources to meet basic needs. LDCs and fragile trends. With its population set to double countries, and tracks the continued erosion countries are also both the origins and the by 2050, Africa has an increasingly narrow of ODA through in-donor refugee costs. hosts of the majority of the world’s displaced window of opportunity to harness a potential Chapter two analyses trends in domestic people, and they have the fewest resources to ‘demographic dividend.’ We need a step revenue mobilisation and expenditures tackle this instability. There are huge income change in investments of aid, private flows against commitments in health, agriculture and gender inequalities in the most vulnerable and domestic resources in the education, and education. Finally, chapter three focuses countries. Poverty is sexist, and this is both employment and empowerment of Africa’s on international private finance to Africa—its unjust and inefficient; investing in girls and youth. ONE has called for a doubling of all current levels, opportunities for increasing it, women gets the best returns in terms of poverty forms of development finance by 2020 for the and the role that ODA can play. The second eradication, peace and prosperity. continent’s doubling population.4 Important half of the report features profiles of 10 donor initiatives are beginning to take shape. The countries plus the European Union, with It is shocking, then, that this year’s DATA new G20 Partnership with Africa—particularly analysis of individual aid levels. Report reveals that these countries, and above the Compact with Africa initiative, which all the world’s poorest citizens, are receiving a is focused on increasing private sector declining share of global financial resources. investment—and the African Union’s roadmap KEY FINDINGS ‘The 2017 DATA Report: Financing for the African for harnessing the demographic dividend Century’ analyses aid, domestic resources and have a vital role to play. In an encouraging A. THE QUALITY OF ODA private finance flows to Africa, particularly to sign, the World Bank Group has committed the many countries that are deemed fragile $57 billion ($45 billion from its concessional IS UNDER THREAT or least developed, and finds that resources window) to the region over the next three Superficially, global ODA reached an all- flowing to the continent do not reflect global years, providing the foundation for a doubling time high of $140.1 billion in 2016 (at current trends. While official development assistance of overall development finance. But long term prices)—a 7.4% increase from 2015 in (ODA) is growing globally, LDCs and Africa are commitments must be made by leaders, real terms. Despite this increase, OECD receiving a declining portion. Germany and alongside quick implementation, to ensure Development Assistance Committee (DAC) Italy, for example, spend more aid money on in- progress. Redoubling investments in girls and countries are still lagging far behind on their country refugee costs at home than they do in women, particularly in the poorest countries, global commitments, with ODA representing aid to Africa. Foreign direct investment (FDI) to is also essential for fighting the poverty that only 0.31% of their collective gross national Africa remains the lowest to any region in the is concentrated in these countries. Achieving income (GNI)—far below the UN target of world by far and has fallen in recent years as a sustainable quality of life, where citizens 0.7% and only a 0.01 percentage point proportion of global flows. Domestic revenues and communities can stay reliably above increase from 2015. Only six countries met in African countries are also declining. Most of and away from extreme poverty, is the goal if the 0.7% target in 2016. At the same time, aid the people in the region, which is home to over we want to make extreme poverty history. is not being allocated to the countries where it 50% of the world’s extreme poor,3 are in danger is needed most. The share of aid to the poorest of being left behind. In the first chapter of this report, ONE looks countries has continued to decline, from 32% at the latest ODA figures, compares donor 8 EXECUTIVE SUMMARY FIGURE 1: FINANCIAL RESOURCES IN AFRICA ARE DECLINING 700 45 47 46 77 600 42 74 48 43 66 73 71 43 61 500 42 61 35 61 65 400 32 44 300 333 378 496 383 469 520 568 548 495 434 USD BILLIONS, CURRENT PRICES USD BILLIONS, 200 100 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 DOMESTIC REVENUES FDI ODA of all aid going to LDCs in 2013 to 28% in 2016, Africa; in Norway and Switzerland, increases away from fighting poverty and saving lives in and the share of aid to Africa declined from in in-donor refugee costs hid decreases in developing countries. 33% in 2015 to 32% in 2016. actual aid flowing to developing countries. Four DAC donors—Greece, Italy, Austria and One promising feature of 2016 was the DAC donors spent $15.4 billion on supporting Hungary—allocated more than 50% of their record $75 billion commitment for the refugees and asylum seekers in their own bilateral assistance in 2016 to in-donor refugee 18th replenishment of the International countries in 2016, an increase of 27% from the costs.