The world’s most generous donor nation’s development minister talks to us about where the world is going wrong on aid and Western hypocrisy over international law breaches.
Also in today’s edition: The EU’s departing aid leader has a “Team Global” dream, and food for thought — though not much of it to eat — at the 29th U.N. Climate Change Conference, or COP29.
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Norway is a small country with a big heart. The Nordic nation’s population is just 5.5 million, but it is the 10th largest aid donor in the world and the only OECD country that allocated more than 1% of its national income to official development assistance, or ODA, last year — making it the most generous in ODA-to-GNI terms.
Anne Beathe Tvinnereim, the Norwegian minister of international development, is the woman overseeing this impressive effort, and she explained what she believes Norway is getting right — and where the world is going wrong — when she sat down with Devex at the 2024 International Monetary Fund and World Bank Group annual meetings.
Tvinnereim is clearly proud of her country’s new strategy on food security, focusing on investing in small-scale food producers, which is “not only saving lives and feeding people” but is also “a huge development opportunity,” she said.
Looking beyond Norway’s borders, the minister stressed the damage to development from countries “pointing fingers” with a stance that “you're either with us or against us,” warning simply: “That doesn't work.”
Who does Tvinnereim have in mind? Well, she drew the contrast between Western countries’ demanding outright support to defeat Russia's invasion of Ukraine while turning a blind eye to other “breaches of international law” in Sudan or Myanmar, for example.
Across Europe, aid budgets are in retreat, but Tvinnereim hailed “big support from the [Norwegian] public for a high ODA for many, many years” — while acknowledging she now faces “a bigger job of defending it.”
Read: What’s on the mind of Norway’s development minister? (Pro)
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From a European politician with undimmed faith in state development aid, we turn to one who believes the world is shifting into a “post-ODA era” of leveraged private investment — Jutta Urpilainen, the European Union’s outgoing development chief.
Opening up to Devex on the sidelines of the same annual meetings, the Finn defended the focus during her years in office on securing critical raw minerals — “We are very dependent on China … so we have to multiply, we have to diversify our partnerships with our partners,” she said. She also denied strong evidence that the EU has turned its back on the least developed countries, or LDCs, insisting: “In terms of funding, least developed countries are our priority.”
Urpilainen’s comment on curbing migration raised my eyebrows. “We can never ever build that kind of wall which would stop 2.5 billion citizens from coming to Europe,” she said, citing Africa’s projected population in 2050. “So the only way to prevent illegal migration and also I would say manage migration in a sustainable way is really to invest in those societies and provide more opportunities.”
One can’t move in Brussels for talk of “Team Europe” — the buzz term for the EU, its member states, and the continent’s development banks putting their shoulders to the same wheel — but Urpilainen wants to go much further with “Team Global” — by removing the “silos” dogging more effective joint working by the “international community.” Which, in our hostile world, is an optimistic vision, to say the least.
Read: Exit Urpilainen — An EU development chief’s final act (Pro)
ICYMI: EU aid to least developed countries is trending way down (Pro)
In Baku, Azerbaijan, where Devex climate reporter Jesse Chase-Lubitz has her eye on daily developments at COP29, the topic under the microscope yesterday was finance — but, as she explains in our reporter’s notebook, that “doesn’t mean any new financial progress was made.”
Another hot topic: carbon markets, which Jesse writes is one of those sideline conversations that’s destined to become central to discussions next year. So far, six African countries have signed carbon credit deals since the African Carbon Markets Initiative was launched in 2022 at COP27: Malawi, Kenya, Gabon, Nigeria, Togo, and Ghana.
Jesse also contemplates what the low-quality food on offer might be doing to the digestive systems of the negotiators charged with trying to save our world, and reveals the startling response of one leading development banker to suggestions that — with global debt hitting $312 trillion in the second quarter of this year — it might be tipping too far into the red. The French Development Agency’s CEO is not losing any sleep over the matter, it seems.
And as always, check out Jesse’s thoughts on the pavilions (hint: There’s a little pick-me-up at the Moana pavilion, which showcased traditional Pacific dancing throughout the day.)
Read Jesse’s latest entry: Behind the scenes at COP29
And ICYMI, listen: What are we watching at COP29?
+ Watch this space for all the latest COP29 coverage. Stay tuned next week for a special edition Newswire focused on the summit and don’t forget to subscribe to our podcast, This Week in Global Development, for special episodes from the ground.
We are all familiar with warnings that the economies of small island developing states, or SIDS, are sitting ducks as extreme weather events become more common, but what is the true scale of their likely losses as the planet heats up?
ODI Global has tried to measure the pain to come, by incorporating “indirect costs” — the impact on future growth and government revenues from the more obvious immediate damage to, for example, infrastructure, housing, tourism, and agriculture.
It calculates cumulative annual costs of $6.1 billion from extreme weather in SIDS for the period 2000-2022. Dominica was the worst affected small island, after a 2017 hurricane, hard on the heels of a 2015 tropical storm, wiped out 17.6% of its GDP, followed by Grenada (5.5%), The Bahamas (4.2%), and Haiti (3.8%).
But this, ODI Global says, is just a foretaste of the pain to come — which could reach $75.2 billion by 2050 across the 35 island nations studied, if the world warms by 2 degrees Celsius above pre-industrial levels.
Emily Wilkinson, director of ODI Global’s Resilient and Sustainable Islands Initiative, tells me: “Small Island nations are the canary in the coal mine for humanity. Given the relatively small size of their economies, the increasing loss and damage from climate change represents a catastrophic scenario.”
ICYMI: Aid rules shake-up offers hope to climate-threatened small islands
Pepukaye Bardouille is the director of the Bridgetown Initiative, the influential road map to help climate-vulnerable nations. In a Devex opinion piece, she outlines four immediate steps to unlock hundreds of billions in climate funding:
• Draw on the potential of existing Special Drawing Rights, or SDRs.
• Ensure more SDRs and diversified finance.
• Unlock multilateral development bank capital by lowering equity-to-loan ratios.
• Redirect fossil fuel subsidies.
“They are feasible and can be implemented immediately, relying solely on political will to drive them forward without delay,” she writes. “If COP29 can set these steps in motion, it could be remembered as a turning point for the climate crisis.”
Opinion: These 4 concrete steps will help close the climate finance gap
While Japan’s yen has been on a bumpy ride, the country’s foreign aid — powered by strategic loans — is stronger than ever.
Under Akihiko Tanaka’s lead at the Japan International Cooperation Agency, or JICA, Japan’s aid keeps flowing thanks to a model that reinvests repaid funds and borrows from the government at ultra-low rates.
For decades, Japan has favored concessional loans, funding key projects across the Indo-Pacific that recipient countries proudly claim as their own, writes Devex reporter Elissa Miolene. Unlike USAID’s grant-focused approach, JICA’s loan model prioritizes long-term impact over immediate aid, with projects in countries like India and Bangladesh driving growth.
This approach aligns with Japan’s broader goals of supporting a “free and open Indo-Pacific” and counterbalancing China’s lending practices. While Japan’s loans are low-interest and flexible, China's often come with higher rates and shorter terms — adding a competitive edge to Japan’s development strategy.
Tanaka sees JICA’s loan model as a balance between sustainable investment and local empowerment, hinting that both grants and loans have their place. A loan builds ownership, he says. And while grants are valuable, Japan’s unique approach is keeping its foreign aid robust, even as the yen wavers.
Read: The yen has fallen, but JICA has grown. How is Japanese aid keeping up? (Pro)
Israel allowed 15 aid trucks into northern Gaza Wednesday, as aid groups warn of looming famine. [The Independent]
The global food import bill is expected to surpass $2 trillion in 2024, driven in part by the rising costs of cocoa, coffee, and tea, according to a Food and Agriculture Organization report. [UN News]
The cost of adapting to a sea-level rise due to climate change in three of the most vulnerable atoll nations in the Pacific is nearly $10 billion, the World Bank estimates. [Reuters]
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