Financial integrity for sustainable development

By José Antonio Ocampo, Professor at Columbia University, and former UN Under-Secretary-General for Economic and Social Affairs and Finance Minister of Colombia

The world must curb financial flows associated with tax evasion and avoidance, as well as those obtained through corrupt activities and money laundering. The magnitude of the funds involved is immense; trillions of dollars in bank accounts and other assets, and not just in tax havens. The concealed money drains resources from the hands of governments, generates increasing inequality –because the beneficiaries are generally rich people— and causes significant deterioration in public sector governance worldwide. Increased transparency and accountability to curb these flows would improve governance and enhance fairness at the national and international levels.

The problems are systemic and therefore require systemic solutions. This is the basic message of the Financial Integrity for Sustainable Development Report launched by a High Level United Nations Panel on February 25th. It represents a landmark in the fight against illicit financial flows in the global economy. Former prime minister of Niger Ibrahim Assane Mayaki and former president of Lithuania Dalia Grybauskaitė co-chaired the Panel, which included 15 independent members from around the world. The Panel’s recommendations aim at strengthening national governance, as well as enhancing international co-operation on specific controls on tax abuse, money laundering or corruption, but also to build a coherent ecosystem of institutions to curb these illicit practices.

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La révolution tunisienne dix ans après : pourquoi doit-on continuer à y croire ?

Par Hakim Ben Hammouda, Universitaire et ancien Ministre de l’Économie et des Finances, Tunisie

La révolution tunisienne le 14 janvier 2011 a été à l’origine d’une grande espérance. Non seulement, elle a libéré la Tunisie d’un autoritarisme anachronique mais elle a aussi ouvert le système politique sur les principes de la modernité politique. Les nouveaux pouvoirs dans les pays des révolutions arabes et dans les autres pays se sont engagés à opérer de grandes réformes constitutionnelles afin d’instaurer le pluralisme politique et un système démocratique avec des élections ouvertes. Parallèlement aux changements politiques, la refonte des modèles de développement était au cœur des priorités post-révolutions et le rêve de construire de nouveaux modèles durables.  

Mais, ces promesses ont été rapidement trahies laissant derrière elles un champ de ruines et un goût d’inachevé. Les transitions politiques se sont transformées dans des conflits ravageurs et dans des guerres destructrices comme en Syrie, en Libye ou au Yémen. Dans d’autres pays la parenthèse démocratique s’est rapidement renfermée et a donné lieu à une restauration autoritaire. Les printemps arabes se sont mus en un hiver glacial qui a emporté les rêves et les espoirs de lendemains qui chantent. Seule la Tunisie a pu poursuivre son chemin et sa transition démocratique. Mais non sans de grandes difficultés et des défis importants qui restent à relever, parfois dans une grande indifférence.

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Joe Biden’s chance to renew multilateralism for a green recovery

By Kevin P. Gallagher, Professor and Director of the Global Development Policy Centre at Boston University & Co-chair for the ‘Think 20 Task Force on International Finance’ at the G20 for 2021

This blog is part of a thread looking more specifically at the impacts of the COVID-19 crisis in terms of capital flows and debt in developing countries.

The COVID-19 pandemic triggered the worst economic downturn since the Great Depression. World leaders were quick to convene through the G20 to try and stem the crisis but limited by the dismissal of the process by the United States. Newly elected US President Joseph Biden has just issued a game changing new Executive Order declaring that the United States Treasury shall “develop a strategy for how the voice and vote of the United States can be used in international financial institutions, including the World Bank Group and the International Monetary Fund, to promote financing programmes, economic stimulus packages, and debt relief initiatives that are aligned with and support the goals of the Paris Agreement.”

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Can civil society survive COVID-19?

By Elly Page, Senior Legal Advisor, International Center for Not-for-Profit Law (ICNL) and Simona Ognenovska, Research and Monitoring Advisor, European Center for Not-for-Profit Law Stichting (ECNL)

As the world confronts new waves of COVID-19 cases, civil society should be wary of a parallel surge of new emergency laws and measures that restrict fundamental freedoms. According to our COVID-19 Civic Freedom Tracker, 146 countries enacted 385 measures in response to the pandemic that affected human rights, during the initial waves of the virus from January to September 2020. While some may have been a necessary and understandable reaction to a public health crisis, many overreached, exacerbating existing challenges to civic space. In particular, existing barriers to foreign funding for organisations have remained in place during the pandemic, limiting their ability to provide support to vulnerable populations during the crisis. The onslaught urgently requires an international response to roll back restrictions and increase support for embattled civil society.  

Our Tracker, based on information from our worldwide network of civil society partners, reflects ways that governments’ responses to COVID-19 have affected civic space, and suggests ways that OECD Development Assistance Committee (DAC) members could respond. These suggestions are timely as the OECD-DAC takes further steps to develop a DAC policy instrument on enabling civil society.

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Gaps in the trap: Neglected politics in middle-income trap analysis

By Richard F. Doner, Professor Emeritus, Department of Political Science, Emory University1


Scholars, advisors and policymakers alike have paid extensive attention to the middle-income trap. Despite some differences in definition, most agree that the “trap” refers to various conditions that have discouraged many middle-income countries from ascending to high-income status. Cross-national economic convergence has been nowhere near what was expected given middle-income countries’ access to advanced technologies and market opportunities.

Explanations for the trap vary but typically include some combination of low productivity, inconsistent macroeconomic policies, weak institutional frameworks, policies ill-adapted to promoting technology absorption, and weak human resource development. As a recent post by Alonso and Ocampo argues, these writings have been valuable in focusing attention on the challenges of a particular stage of development. Nevertheless, gaps, we might even call them blind spots, persist in analysis of the middle-income trap.   

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A new social contract for informal workers: Bridging social protection and economic inclusion

By Martha Chen, Senior Advisor, WIEGO and Lecturer in Public Policy, Harvard Kennedy School, Laura Alfers, Director, Social Protection, WIEGO and Research Associate, Rhodes University, and Sophie Plagerson, Visiting Associate Professor, Centre for Social Development in Africa, University of Johannesburg

Photo by Martha Chen

Calls to renew the social contract have proliferated in recent years as the “standard” employer-employee relationship has ceased to be the norm, while traditional forms of informal employment persist and informalisation of once formal jobs is on the rise.1 However, there is a mismatch globally between traditional social contract models based on assumptions of full (male and formal) employment and the world of work today in which informal workers, both self- and wage employed, constitute over 60 per cent of the global workforce. Can the call for a new social contract really help to achieve greater recognition and a more level playing field for informal workers?

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Middle-income countries should not be rushed to graduate

By Otaviano Canuto, Senior Fellow at the Policy Centre for the New South, Non-Resident Senior Fellow at Brookings Institution, and Former Vice President at the World Bank; Matheus Cavallari, Senior Advisor and Tiago Ribeiro dos Santos, Advisor at the Board of Executive Directors of the World Bank Group. Opinions here are their own. The authors wrote chapter 12 of the recent book: Alonso, J.A. & Ocampo, J.A. (eds.), Trapped in the Middle? Developmental Challenges for Middle-Income Countries, Oxford University Press, 2020

Salvador, Bahia, Brazil

Many donor countries seem eager to see middle-income countries (MICs) “master out” and graduate to a non-client status in multilateral development institutions before fully achieving their development potential. We argue that such institutions can still significantly contribute to the sustainable development of MICs, while also seizing many benefits from this relationship (Middle income countries and multilateral development banks: traps on the way to graduation).  

Multilateral development banks operate in two main ways: regular lending and concessional finance. Regular lending uses interest rates close to market levels and relies on multilateral development banks’ wealth of knowledge to create attractive projects for MICs. Concessional finance on the other hand, is attractive for low-income countries, not only because of the banks’ knowledge, but also because it is much more financially favourable, offering low interest rates or grants.

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To measure real progress in education we must include out-of-school children

By Michael Ward, Senior Analyst, Education and Skills Directorate, OECD

In many low- and middle-income countries – including some that have participated in PISA – relatively large proportions of 15-year-olds are not enrolled in school or are not enrolled in PISA’s target grades (grade seven and above) and are thus not covered by the assessment (see figure 1). With an increasing number of low- and middle-income countries participating in PISA, and with 61 million children of lower secondary school age, out of school around the world, this population can no longer remain beyond the reach of programmes that try to evaluate the success of education systems.

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Education funding and COVID-19: what does the future hold?

By Laura Abadia, Policy Analyst, OECD Development Centre


This blog is part of a series on tackling COVID-19 in developing countries. Visit the OECD dedicated page to access the OECD’s data, analysis and recommendations on the health, economic, financial and societal impacts of COVID-19 worldwide.


With prolonged school closures affecting over 90% of all learners worldwide at the peak of the first wave, the COVID-19 pandemic has highlighted the urgent need to explore new and more effective approaches to education delivery and content. From hybrid models that combine in-person with remote learning, to widening academic curricula to include social and emotional competencies, the opportunities for change are manifold. However, recovering from prolonged school closures and seizing these opportunities will require making significant headway against the deep structural challenges perpetuating inequalities in education.

To better understand how COVID-19 is changing education donor behaviour and priorities, the OECD Centre on Philanthropy analysed years of OECD data on official development assistance (ODA) and private philanthropy, and interviewed dozens of donors. Here is what we learned:

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Is there an institutional trap in middle-income countries?

By José Antonio Alonso, professor of Applied Economics at the Complutense University of Madrid. He is co-editor of the recent book: Trapped in the Middle? Developmental Challenges for Middle-Income Countries, Oxford University Press, 2020

It is assumed that, as countries progress, they require better institutions to manage the societal issues that emerge with more extensive and sophisticated markets and respond to the needs of a more demanding society. In other words, the development process requires a path of institutional change. However, economic and institutional processes do not necessarily evolve at the same pace, as institutions are subject to greater inertia. As a consequence, inertial institutions can fall behind social demands, or else changes in institutions may not be properly rooted in social behaviour.

These issues are particularly relevant to middle-income countries which tend to experience episodes of intense economic growth that put their institutional frameworks under pressure. Transforming expansive episodes into sustained economic convergence with high-income countries requires a continuous and successful process of institutional improvement. However, these two processes are difficult to synchronise.

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