March / 2019

February / 2019

All the five Nordic countries confirm to Development Today that they will not take a position on David Malpass’ candidacy as President of the World Bank until the board has completed its due diligence and interview process. Malpass was nominated by President Donald Trump and is the only candidate for the job.

Norway rewards Indonesia by leaving out peat burning from carbon accounting

By excluding massive CO2 emissions from peat burning in Indonesia, Norway recently presented a positive carbon tally and granted its first payment to the Southeast Asian forest giant for reduced emissions from deforestation. The NOK 200 million reward coincided with the 10th anniversary of the countries’ climate partnership. If emissions from peatlands had been counted, there might be no basis for payment at all, a scrutiny by Development Today shows.

US nominee Malpass on track to become new World Bank President

David Malpass, 63, is on track to become the next President of the World Bank. As the deadline for nominations expires, he is the only official candidate for the job. It is now expected that the World Bank board will test his commitment to the Bank’s agenda on poverty, climate and multilateralism in the coming weeks.

Brazil receives first Green Climate Fund grant for REDD+. Critics warn of ‘paper reductions’ with no real climate benefits

The Green Climate Fund (GCF) has approved a USD 96 million grant for Brazil, a reward for reductions in emissions from deforestation achieved five years ago. NGOs warned of “paper reductions without any real climate benefits.” Germany and the US pushed for conditions to be attached, while Norway was keen to send a positive signal.

Nordics pressed Trump’s candidate for World Bank Presidency on poverty focus

The Trump administration’s candidate for President of the World Bank David Malpass met with Nordic-Baltic ministers in Reykjavik this week. He was pressed on issues like climate change, gender and his commitment to multilateralism. For now, Malpass is the only candidate in the race, but so far none of the Nordic countries has expressed their support for him.

Replenishment delay has cost Green Climate Fund billions of dollars

Following its 22nd board meeting last week, the Green Climate Fund (GCF) announced it will hold its first replenishment in late October, a year and a half behind schedule. The delay has meant a loss of climate financing amounting to USD 4 billion.

Iceland’s ex-PM Geir Haarde seizes Nordic-Baltic top position at World Bank

The former Icelandic Prime Minister Geir H. Haarde, 67, assumes the position of the Nordic-Baltic countries Executive Director at the World Bank this summer, a spokesperson at the Foreign Ministry in Reykjavik confirms to Development Today.

Humanitarians call for neutral aid and access to mitigate Yemen crisis

Nordic donors pledged USD 67.4 million for the humanitarian crisis in Yemen during a recent donor meeting in Geneva. This amounts to one-tenth of the OECD countries’ Yemen aid. Two Arab allies fighting in the war provided the lion’s share of funds, raising concerns about impartiality of relief aid.

New Danish UNEP boss must regain donors’ trust after Solheim debacle

The Dane Inger Andersen has been chosen to restore confidence at UNEP in Nairobi after the former chief Erik Solheim was forced to leave three months ago. An audit revealed that he had travelled excessively and encouraged staff to “wilfully violate” UN rules, “encouraged a culture of impunity ... and weakened the control environment .”

Tough competition for donor money: Global health agencies under scrutiny for inflating results

In an environment of fierce competition, global health initiatives like the Global Fund are making grand claims regarding the numbers of lives they can save if donors provide enough money. But in the new, more holistic SDG era, with an ambition of universal health coverage, researchers say that such claims are “misleading.” “We have to stop this game of trying to say exactly how many years or months or lives we can buy with one earmarked dollar,” says Gorik Ooms at the London School of Tropical Medicine & Hygiene to Development Today.

Finnfund eyes record expansion. Doubts about risks and profit

Finnfund might soon receive its largest-ever injection of capital. It plans to focus on high-risk markets, double its investments and triple its impacts, while at the same time maintaining profit levels. An evaluation report warns that Finnfund will be hard pressed to tick all these boxes at once.

Mutual distrust between donors and humanitarians, ‘opaque’ decision making on both sides

Humanitarian aid would stretch farther and respond better to those most in need if donors coordinated their allocations in a transparent manner instead of making funding decisions in isolation, but there is little appetite among donors to do so. This is one of the conclusions of a recent study on underfunded humanitarian appeals commissioned by the Swedish aid evaluation office, EBA.

Bring China into the international financial system

Will China indebt the world? China has risen rapidly to become the world’s largest infrastructure creditor. Its lending is politically driven, risk-prone and opaque, and has left many borrowers with unsustainable debt. China should be encouraged to join the established, rules-based international financial system, writes Robert Wihtol, a former Director General at the Asian Development Bank.

Danish SDG fund grows to DKK 4.85b, first investments in blueberries and solar

Starting with a government grant of just DKK 100 million, the Danish aid-funded investor IFU has announced the close of its SDG fund worth DKK 4.85 billion. The fund’s first two investments are in blueberry farms in South Africa and solar power in the Ukraine.

Aid reform at home is new Christian Democrat minister’s toughest task

Dag Inge Ulstein (Christian Democrat) has been put in charge of the development portfolio at Norway’s Foreign Ministry. One of his most urgent tasks starts at home: moving forward the stalled reform of the aid administration. His party has not given up the idea of creating a new Development Ministry.

Green Party’s Peter Eriksson new Swedish development minister

More than four months after the election of a new Parliament, a new red-green government takes office in Sweden. Green veteran Peter Eriksson becomes Development Minister, while his party colleague Isabella Lövin leaves the job to take over the environment portfolio.

Norway doubles down on climate forest aid as deforestation continues to rise

A decade has passed since Norway became the world’s largest forest donor. In an interview with Development Today, Climate Minister Ola Elvestuen sheds light on the status of the multi-billion-dollar climate forest programme in key recipient countries. In Indonesia performance-based payments could begin by 2020. The Amalia Falls hydropower dam in Guyana, which Norway has been pushing for years, is off the table. Regarding Brazil, Elvestuen shifts the Norwegian narrative, admitting it is impossible to say to what degree rainforest payments have contributed to reduced deforestation.

Billion-dollar vaccine subsidy. Donors reject proposed changes aimed at pushing down price

Donors refuse to ring-fence the remaining money in a billion-dollar pneumonia vaccine fund and give it to an Indian pharmaceutical that can push down the price dramatically. Most of the money has gone to the two big pharma companies, GSK and Pfizer, which dominate the market and, critics say, prevent price competition.

Tied Finnish mixed credit scheme in high demand

A new, tied aid-financed scheme for infrastructure projects is in high demand among Finnish export firms. Only one in six projects made it through the needle’s eye this year. NGOs and the OECD have criticised Finland’s practice of linking aid to its own exporters.

Danish business group lukewarm on private sector aid scheme linked to NGOs

When a conventional approach to promoting private sector aid failed to produce long-lasting results, Danida came up with a new model for stimulating good business ideas and jobs in developing countries - with NGOs as a key part of the equation. The reaction from the Danish private sector is mixed.

Grim assessment: 10 years of REDD+ has not slowed deforestation

The REDD+ concept, which was based on the deceptively simple idea that giving cash to forest-rich countries would incentivise them to protect their forests, raised huge expectations a decade ago. With USD 2.7 billion committed, 60 per cent of this from Norway, REDD+ has not slowed deforestation, a team of researchers conclude in a new book published by CIFOR. Still, they say, REDD+ should not be abandoned.

Norfund prepares new growth strategy as Thorleifsson takes over

A venture capitalist with a soft spot for smallholder farmers in Africa and a strong stomach for risk taking,Tellef Thorleifsson has taken over the helm of Norfund, the 22-billion-crown aid-financed investment fund in Oslo. His first task is to oversee a new Norfund strategy.

Nordic donors divided over best response to homophobic crackdown in Tanzania

While Denmark has frozen DKK 65 million in aid in response to the anti-gay crackdown in Dar es Salaam, Norway is opting for diplomacy. Norwegian Development Minister Nikolai Astrup will raise his concern about the rise of homophobia during his visit to Tanzania this week, but withholding aid is not on his agenda.

Sida to decide on major aid package in wake of Solheim’s departure from UNEP

Just days after the embattled UNEP chief Erik Solheim announced his resignation, the Swedish agency Sida tells Development Today that it is preparing to decide on a large aid package to the Nairobi-based agency. The funding was put on hold in September in response to revelations in an on-going audit of excessive travelling costs incurred by Solheim and his staff.

Danish financing window links businesses with non-commercial actors to promote SDGs

Ecological coffee, recycling of plastic from used fishing equipment and digital solutions for enhancing agricultural production. These are among the ten projects awarded grants from Danida’s unique business financing window.

Save the Children calls for halt in Gavi vaccine subsidies to two pharma giants

The donor-funded vaccine alliance Gavi has over the last decade spent more than USD 1.2 billion out of its special fund for pneumonia vaccine, the AMC, on two Western pharma giants GSK and Pfizer. The AMC was supposed to encourage new suppliers to enter the market. Save the Children now wants Gavi to reserve the remaining AMC money for the Indian supplier Serum Institute.

Norway to disburse NOK 600m to support Brazil’s rainforest

Norway has decided to pay USD 70 million (NOK 600 million) to Brazil for reduced emissions from deforestation in the Amazon in 2017, the Climate Ministry announces in a press release. Climate Minister Ola Elvestuen calls the climate forest cooperation with Brazil a “great success,” but says recent trends give “reasons for concern.”

Swedish caretaker government: aid at 1% of GNI in 2019, few clues about priorities

The current Swedish administration, which is acting as a caretaker government, proposes that aid remains at 1 per cent of Gross National Income (GNI) next year, but provides few details about priorities.

Back to Bujagali. Stepping stone for SN Power to expand in Africa

The partly aid-financed Norwegian hydropower investor SN Power bought a major stake in Uganda’s Bujagali hydropower project in July. Fifteen years ago, SN Power turned down a World Bank offer to become an owner in the project, but now the company sees its newest acquisition as a stepping stone for expansion in the African market, CEO Torger Lien tells Development Today.

GFF health initiative fails to reach USD 2 billion replenishment target

The Global Financing Facility (GFF), a World Bank-managed trust fund for health and nutrition, raised only a fraction of the new money it needed to achieve a USD 2 billion target at its first replenishment meeting in Oslo this week.

How Finnfund can take more risk in fragile states and pioneering projects

Finnfund raises half its project funding from private markets and is less capitalised than its Nordic sister organisations. A new special guarantee scheme is designed to make Finnfund able to invest in pioneer projects and fragile states, without jeopardising its trust with lending banks.

Sweden turns down Norwegian-sponsored GFF health initiative

Sweden will not pledge funding for the Global Financing Facility (GFF) health initiative at a donor meeting in Oslo next month. “We have a health architecture that is already very crowded, and we do not think that we need a new structure,” says Anders Nordström, Sweden’s Global Health Ambassador, to Development Today.

What killed budget support: ‘Schizophrenic’ donors couldn’t let go of aid conditionality

General budget support, a popular instrument in the aid tool box during the 2000s, was effective and cheaper than project aid. Donors abandoned it because of their latent mistrust of recipient governments, a new study concludes.

Indonesia-Norway climate forest deal. Six years behind schedule, but still relevant

Norwegian result payments for Indonesian forest protection have not materialised nine years after a cooperation agreement was signed. An evaluation urges Norway to make its first carbon payment by 2020 and concludes that the bilateral deal is still relevant.

Report: Norway’s inefficient and confusing aid administration

In a donor landscape where most aid management is either delegated to a separate directorate or integrated into a foreign ministry, Norway is the only OECD country that splits grant management between a ministry and its aid agency, according to a new report commissioned by Development Minister Nikolai Astrup. This, the report concludes, creates both inefficiency and confusion.

Risk of GFF health scheme becoming a debt trap for poor countries

As the Global Financing Facility (GFF) gears up for its first replenishment next month, there are warnings that by making poor countries take up World Bank loans, the ambitious health scheme could lead to increased indebtedness.

An alternative DFI: FinnChurchAid kicks off new investment firm

In a pioneering move, the Helsinki-based NGO FinnChurchAid (FCA) has launched an investment company that will manage a EUR 16 million loan from the Finnish government to be invested in small businesses in African and Asian countries, the first of its kind in the Nordic countries.

First Nordic test of new reporting rules for refugee aid beefs up ODA

Denmark, being the first Nordic country to use the OECD’s new reporting regime for counting domestic refugee expenses as official aid, has concluded that it can increase reporting of such aid by 60 per cent for 2017.

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MARKET AND BUSINESS

Back to Bujagali. Stepping stone for SN Power to expand in Africa

How Finnfund can take more risk in fragile states and pioneering projects

An alternative DFI: FinnChurchAid kicks off new investment firm

Finnfund invests in multiple tree plantations in Africa and Latin America

Finnfund has committed USD 10 million to a new forestry fund, the Arbaro Fund, that will invest in industrial tree plantations in 12 countries in Sub-Saharan Africa and Latin America over the next 15 years.

Tommy Thomsen leaves IFU, Huss to act as new CEO

Torben Huss will become acting chief of the Danish aid-financed risk capital fund IFU when the current CEO Tommy Thomsen leaves the organisation to take up a new assignment in the private sector.

Report: investment landscape turned upside down

Financial reform advocate Sony Kapoor says DFIs like Swedfund and Norfund can be important partners for forming bridges between Western institutional investors and promising emerging markets.