Carnegie Endowment for International Peace
Source: Getty
Summary: Many African countries have placed economic diversification high on the policy agenda, yet they first need to define what it means in their specific structural and socioeconomic contexts.
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Summary
For decades, economic diversification has been a policy priority for low- and middle-income economies. In the words of former managing director of the International Monetary Fund (IMF), Christine Lagarde, “We know that economic diversification is good for growth. Diversification is also tremendously important for resilience.” Unfortunately, this goal continues to elude many African countries. In fact, the continent is home to eight of the world’s fifteen least economically diversified countries. This reality weakens the foundation of their economic transfomation and slows their pace of progress. It also makes these countries part
Humanitarian aid. Credit Jon Tyson.
The biggest study of its kind has proven the link between local political context and the risk that humanitarian aid money is lost to corruption. The study also provides reassurance that the controls that donors may insist upon can be effective at preventing money going astray.
The paper “Controlling Corruption in Development Aid: new evidence from contract-level data” is published in the Studies in Comparative International Development journal. It is authored by Liz David-Barrett and Ciara McCorley from the University of Sussex, Mihaly Fazekas and Lili Márk from the Central European University, Hungary, and Olli Hellmann from University of Waikato, New Zealand. The study provides the strongest evidence yet that reforming public procurement to protect aid money is a cornerstone in stemming corruption in development aid.