A scene from the 2019 United Nations climate change conference in Madrid, Spain. Photo by: UNFCCC / CC BY-NC-SA

U.K. voters decide the future of foreign aid, Trump targets World Bank lending to China, and climate negotiators prepare for long nights in Madrid. This week in development:

Climate negotiators are in a race to the finish line at COP25 in Madrid. The United Nations climate summit is supposed to conclude on Friday, but a few key issues threaten to send the conference into overtime. One of the most contentious topics revolves around the rules that will govern carbon markets under the Paris Agreement — known as Article 6 in the negotiating text. Parties remain divided over how to set up rules that will decrease overall carbon emissions — instead of just shifting those emissions from one country to another — and direct proceeds from these transactions to climate-change adaptation in climate-vulnerable countries. As they have for years, delegates continue to spar over the issue of “loss and damage,” which acknowledges that since climate change is already occurring, some harm is unavoidable — and indeed already materializing. The big question is whether the conversation on loss and damage should result in concrete financing commitments to countries that experience harm, a proposal that the U.S. delegation, in particular, has sought to block. While protests inside the venue — and a forceful response by security personnel — grabbed headlines, major development institutions continued to grapple with how to align their current mandates with the urgent demands of the Paris Agreement. A collection of multilateral development banks shared an update about the work they are doing to determine what “Paris alignment” means for their strategies, projects, and engagement with client countries. For many of the institutions involved in climate finance, one of the most pressing questions is whether they can move from working on projects to working in broad collaboration toward the rapid decarbonization of the global economy.

The United Kingdom heads to the polls on Thursday to elect a new government, less than eight weeks before it is due to leave the European Union. While foreign aid has been far from a priority issue during the campaign, the outcome of the election could nonetheless have major implications on it. Speculation is mounting that the Conservatives would merge the Department for International Development with the Foreign & Commonwealth Office in early 2020 if they win a majority. Civil servants from the two departments have been asked to draw up plans for a potential merger, although senior Conservative politicians are said to be trying to persuade Prime Minister Boris Johnson to maintain DFID's independence. NGO leaders have also sprung into action to defend the department, publishing open letters and op-eds in the national media over the last few days. Meanwhile, the Labour Party has promised to strengthen the role of DFID if elected, and all major parties — including the Conservatives — have reiterated their support for spending 0.7% of gross national income on aid. The Conservatives are expected to win the most seats but it remains uncertain whether any party will manage to secure a majority. Results will come in overnight.

President Donald Trump weighed in on the World Bank’s continued — albeit decreasing — lending to China. “Why is the World Bank loaning money to China? Can this be possible? China has plenty of money, and if they don’t, they create it. STOP!” Trump wrote on Twitter on Friday. His complaint comes just ahead of the 19th replenishment meeting of the International Development Association, the World Bank’s fund for low-income countries — though it was not immediately clear if the timing was intentional. Trump administration officials have frequently criticized the World Bank’s lending to China, and as part of the capital-increase deal that was negotiated last year, the bank’s shareholders agreed that lending to middle-income countries would scale back. Development experts point out that the World Bank benefits as much from lending to China as China does, since the institution generates positive returns from a reliable borrower and acquires technical expertise from projects that can be shared with other countries. The relationship has been complicated by revelations that some World Bank lending that was meant for a purported educational project in China was used for militarized reeducation camps as part of the government’s crackdown on Uighur Muslims.

About the authors

  • Michael Igoe

    Michael Igoe is a Senior Reporter with Devex, based in Washington, D.C. He covers U.S. foreign aid, global health, climate change, and development finance. Prior to joining Devex, Michael researched water management and climate change adaptation in post-Soviet Central Asia, where he also wrote for EurasiaNet. Michael earned his bachelor's degree from Bowdoin College, where he majored in Russian, and his master’s degree from the University of Montana, where he studied international conservation and development.
  • Jessica Abrahams

    Jessica Abrahams is Devex's Deputy News Editor. Based in London, she works with Devex's team of correspondents and editors around the world, with a particular focus on Europe & Africa. She has previously worked as a writer, researcher and editor for Prospect magazine, The Telegraph and Bloomberg News, among other outlets. She holds graduate degrees in journalism from City University London and in international relations from Institut Barcelona d'Estudis Internacionals.