United Nations leadership contests, rumors of change for U.K. aid, and the Trump plan for Middle East prosperity. This week in development:
Facebook’s plan to create a new global cryptocurrency called Libra has drawn intense scrutiny — both for its potential to drive financial inclusion around the world, and for the risks associated with entrusting financial data to a social media giant with a troubling record. The 27 partners who joined with Facebook to launch Libra have had to weigh those risks and benefits. Among them are a small handful of global development nonprofits — Mercy Corps, Kiva, and Women’s World Banking. Representatives from these organizations argue that their involvement in the creation stage of the new cryptocurrency venture is one way to ensure it develops in a way that puts unbanked and underserved populations at the forefront of the payment system’s value proposition — to protect and serve these populations, rather than exploit their information. Libra’s partners see an opportunity to dramatically reduce financial transaction costs, increase stability in crisis and conflict situations, and tap into a global platform that already claims 2.4 billion users — a significant portion of whom live in low-income countries. For others, the project’s association with Facebook is a nonstarter, while some are taking a wait and see approach. “If the Libra ecosystem does not have the mindsets of the poor at the center of its token design and governance structures, it is not a social impact tool but an expansion of the reach for private entities like Facebook and Visa,” says Michael Cooper, an expert at Emergence.
The U.N. Food and Agriculture Organization has a new director-general. Qu Dongyu, China’s vice minister of agriculture and rural affairs, was elected to the top spot on Sunday, overcoming strong objections and behind-the-scenes lobbying from the United States. Devex obtained a nonpaper circulated by the U.S. to FAO members, which stated that “our primary objective is to beat the Chinese candidate.” Of particular concern to the U.S. was its view that “Chinese nationals working in international organizations are expected to align with Chinese policy without question.” In April, when delegates questioned candidates about their positions, the U.S. asked Qu about his independence from the Chinese government. “I am not a typical Chinese official,” he said, describing himself as a “professional scientist.” Qu said his priorities for FAO include hunger and poverty, digital rural development, and transformation of agricultural production to achieve better land use. Meanwhile, the race to replace Michel Sidibé as executive director at the Joint United Nations Programme on HIV/AIDS continues, as the organization has narrowed its pool of candidates to a shortlist of five. The best-known among them is perhaps Winnie Byanyima, currently executive director of Oxfam International.
The U.K.’s aid department could be in line for reorganization under a new U.K. prime minister, according to Rory Stewart, the U.K. aid chief — though he does not expect to be at the Department for International Development long enough to see it happen. Stewart told members of the parliamentary International Development Committee on Wednesday that while he does not expect that either of the candidates currently vying to become the U.K.’s next Conservative leader — Boris Johnson and Jeremy Hunt — would try to fold DFID into the Foreign & Commonwealth Office, he does think they might seek to bring DFID under greater FCO control. “There’s been talk from both candidates about reorganization. My assumption is that this is a reorganization in which there would remain a department and secretary of state but with more influence perhaps exercised by the foreign secretary,” he said. Development advocates have widely criticized similar plans, noting that DFID has repeatedly proven to be more effective at allocating development assistance than the Foreign Office.
The U.N.’s fund for Palestinian refugees received $110 million in donor commitments at its annual international pledging conference in New York on Tuesday — a “remarkable mobilization,” which still leaves the agency facing a severe funding shortfall in the wake of U.S. budget cuts. The United Nations Relief and Works Agency for Palestine Refugees in the Near East requires an annual operating budget of $1.2 billion, and has warned of a “summer crisis” that could see food assistance shortfalls in Gaza, and delayed openings for UNRWA-supported schools. The U.S. government previously contributed $360 million to the fund. The Trump administration reduced that to $60 million in 2018, and cut off funding entirely in 2019, calling the agency an “irredeemably flawed operation.” Just as UNRWA was collecting pledges, Trump’s son-in-law Jared Kushner released the economic portion of a Middle East peace plan he has been tasked with developing. It calls for $50 billion in projects in the occupied Palestinian territories and neighboring countries. Development experts have pointed out that the brochure describing this effort — which many find meaningless in the absence of a political resolution — includes glossy images taken from development projects that the Trump administration has defunded.