Our estimates indicate that barely more than half of the funds received by the WHO support global public goods; the percentage of contributions to UNICEF and UNDP for GPGs is even smaller.
The provision of global public goods
While the low level of funding dedicated to GPGs is a cause for concern, their under-provision is not surprising. Like public goods at the local and national level, standard economic theory suggests that global public goods will be underfunded, because in a world of sovereign nations, no single nation can capture fully the benefit of its own spending on a “global” good (Kaul, 2012). Universal benefits mean fewer political and diplomatic returns on aid spent on GPGs and encourage free riding. Inequalities in global power relations and the lack of effective international governance systems further impede the provision of GPGs. Perhaps this is why funding for even relatively high-profile ‘global commons’ problems, such as climate change, is small compared to the apparent need. The Green Climate Fund - set up in 2010 to channel $100 billion annually from developed to developing countries for climate adaptation and mitigation every year from 2020 - has to date received only $10.2 billion in pledges.
Yet, global public goods make excellent investments. For instance, Hallegatte (2012) estimates that early warning systems in developing countries would yield benefits of between $4 billion and $36 billion a year, with less than $1 billion investment. Devoting an additional $100 million to HIV vaccine R&D is valued to generate returns six times as high (Jamison et al., 2012).
The data problem
The challenge of global public goods provision is exacerbated by lack of reporting by individual countries and international organizations. None of the major institutions with a global mission - such as the World Bank or the WHO or any others in our tables - report on the funds or programs they dedicate to global public goods. Official funders have not agreed on any standard definition of GPGs, nor do they report systematically on their own spending (according to their own definition) on GPGs. The World Bank has issued several staff reports that outline the Bank’s opportunities for engagement with global public goods (World Bank, 2000; World Bank, 2007). In its 2007 report, the Bank stated that its global programs and partnership portfolio was worth about $1.25 billion; however which GPGs were being provided through this spending is unclear. The publicly available budget documents of UN agencies also make it very difficult to distinguish between country-specific and cross-border programs.
Next steps: publish, identify, invest
Better data is a first step towards more and better provision of development-related global public goods. Multilateral organizations as well as individual countries should publish the funds they dedicate to GPGs and identify their programs with global benefits. Counting current contributions can be a first step towards an agreed standard for updating spending on GPGs that contribute to growth and development in developing countries. Improved reporting would encourage the assessment of gaps in the provision of GPGs and highlight the areas where returns to public (and private) investment would be greatest.
Barrett, S. (2007). Why Cooperate?: The Incentive to Supply Global Public Goods. New York: Oxford University Press.
Birdsall, N. and Leo, B. (2011). Find Me the Money: Financing Climate and Other Global Public Goods. Working Paper 248. Washington, DC: Center for Global Development.
Kaul, I., Grunberg, I., and Stern, M. A. (Eds.). (1999). Global Public Goods. New York: Oxford University Press.
Levine, R. (2008). Healthy Foreign Policy: Bringing Coherence to the Global Health Agenda. In N. Birdsall (Ed.), The White House and the World (pp. 43-61). Washington, DC: Center for Global Development.
[i] 2009 data is based on Figure 1 in Birdsall and Leo (2011), ‘Find Me the Money: Financing Climate and Other Public Goods’, Center for Global Development Working Paper
[ii] Advance Market Commitments (AMCs) for vaccines aim to encourage the development and production of affordable vaccines tailored to the needs of developing countries. Source: GAVI spreadsheet - annual donor contributions. There are $511 million of outstanding pledges for AMC for the period 2015-2019.
[iii] The International Finance Facility for Immunisation (IFFIm) uses long-term pledges from donor governments to sell 'vaccine bonds' in the capital markets, making large volumes of funds immediately available for Gavi (Global Alliance for Vaccines and Immunization) programs. Source: GAVI spreadsheet - annual donor contributions.
[iv] The Global Environment Facility is a partnership for international cooperation where 183 countries work together with international institutions, civil society organizations and the private sector, to address global environmental issues. Source: GEF Trust Fund financial statements 2012
[v] Total expenses in FY 2009. Updated from the original Birdsall and Leo (2011) figure based on the GEF Trust Fund Financial Statement 2010.
[vi] Annual share of total value of new pledges for the GEF’s fifth replenishment (2010-2014). $3.7 billion has been pledged for the GEF’s sixth replenishment, to finance the Facility’s activities for 2014-2018. Source: GEF-5 Funding Retrospective
[viii]The Climate Investment Funds (CIF) provides 48 developing and middle income countries with urgently needed resources to mitigate and manage the challenges of climate change and reduce their greenhouse gas emissions. Values include contributions to the Clean Technology Fund and Strategic Climate Fund, received in fiscal year.
[x] The Forest Carbon Partnership Facility assists developing countries in their efforts to reduce emissions from deforestation and forest degradation and foster conservation, sustainable management of forests, and enhancement of forest carbon stocks (all activities commonly referred to as "REDD+") by providing value to standing forests. Values include contributions in fiscal year for both the Carbon Fund and the Readiness Fund. Source: the FCP’s Annual Report
[xi] The Amazon Fund aims to prevent, monitor and combat deforestation, as well as to promote the preservation and sustainable use of forests in the Amazon Biome, financed by donations. The yearly value for 2012 reflects actual disbursements from the Norwegian and German government between 2010 and 2014, divided evenly between these five years. Between 2012 and today, another $145 million have been disbursed.
[xii] Total approved budget for FY (2011 reflects approved budget from 07/2011 to 06/2012). Source: UN Peacekeeping Operations Factsheet Dec 2011 and Dec 2012
[xiii] 3ie funds impact evaluations and systematic reviews that generate evidence on what works in development programs and why. Listed outlays based on disbursements from 3ie annual reports.
[xiv]EITI promotes and supports improved governance in resource-rich countries through the full publication and verification of company payments and government revenues from oil, gas, and mining. Values reflect total revenue received from donors: 2009 value based on EITI board papers; 2011 and 2012 value based on email correspondence with the World Bank’s Diana Corbin (Senior Operations Officer- Donor Relations)
[xv] The CGIAR Fund is a multi-donor trust fund that supports international agricultural research aimed at reducing rural poverty, strengthening food security, improving human nutrition and health, and enhancing natural resource management. The research is carried out by 15 international agricultural research centers, working closely with hundreds of partners worldwide, through a portfolio of CGIAR Research Programs. Source: CGIAR Financial Reports 2012 and 2011.
[xvi] Calculations based on Appendix 1 table in Birdsall and Leo (2011); estimate is 39% of the IMF’s administrative spending in given year (based on the Crockett Report’s estimate of the share of surveillance costs).
[xxiii]Both values for the 18months ended 30 June 2011;
[xxiv]Both values for the 18months ended 30 June 2013;
[xxvi]Data only available for two-year segments; value reflects 50% of total 2010 and 2011 combined contributions
[xxx]Data only available for two-year segments; value reflects 50% of total 2010 and 2011 combined contributions
[xxxii]Data only available for two-year segments; value reflects 50% of total 2010 and 2011 combined contributions
[xxxiii]Data only available for two-year segments; value reflects 50% of total 2012 and 2013 combined contributions