Even while policy solutions to address de-risking are being implemented, new technologies have emerged to address de-risking by increasing the efficiency and effectiveness of AML/CFT compliance by financial institutions.
As recently as 2011, only 42 percent of adult Kenyans had a financial account of any kind; by 2014, according to the Global Findex database, that number had risen to 75 percent, including 63 percent of the poorest two-fifths. In Sub-Saharan Africa as a whole, the share of adults with financial accounts, either a traditional bank account or a mobile account, rose by nearly half over the same period. Many countries in other developing regions have also recorded, if less dramatic, gains in access to the basic financial services that most people in richer countries take for granted. Much of this progress is being facilitated by the digital revolution of recent decades, which has led to the emergence of new financial services and new delivery channels.
Money laundering, terrorism financing and sanctions violations by individuals, banks and other financial entities are serious offenses with significant negative consequences for rich and poor countries alike. Governments have taken important steps to address these offenses. Efforts by international organizations, the US, UK and others to combat money laundering and curb illicit financial flows are a necessary step to increase the safety of the financial system and improve security, both domestically and around the world. But the policies that have been put in place to counter financial crimes may also have unintentional and costly consequences, in particular for people in poor countries. Those most affected are likely to include the families of migrant workers, small businesses that need to access working capital or trade finance, and recipients of life-saving aid in active-conflict, post-conflict or post-disaster situations. And sometimes, current policies may be self-defeating to the extent that they reduce the transparency of financial flows.
Government contracts regarding the use of public property and finances should be published by default. Many jurisdictions already require that contracts be made public in response to requests for the information; some now publish contracts proactively. Doing so helps new entrants compete in the market for public contracts, helps governments model their projects on other successful examples, and allows citizens greater insight into how their taxes are being spent. This provides a practical outline for reaping the benefits of open contracts while addressing legitimate concerns about costs, collusion, privacy, commercial secrecy, and national security.
Staff update of the 2011 report Beyond Bullets and Bombs: Fixing the US Approach to Development in Pakistan, based on the deliberations of the CGD Study Group on a US Development Strategy in Pakistan.
This report presents the results of the second edition of the Quality of Official Development Assistance (QuODA) assessment, with a focus on the changes that have occurred in donor performance since the first edition (2008).
In a new CGD report, U.S. and Pakistani development experts urge a substantial revamp of the U.S. approach to Pakistan, saying that U.S. efforts to build prosperity in the nuclear-armed nation with a fledgling democratic government, burgeoning youth population, and shadowy intelligence services are not yet on course.
The time is right to reinvigorate UNFPA. Seventeen years after the groundbreaking ICPD meeting, UNFPA needs to make itself the lead agency for population, sexual and reproductive health, and reproductive rights in the UN system, as well as be more visible externally.
MCA Monitor: Which Countries Jump the FY2010 Corruption Hurdle? A Preview into Round 7 of Millennium Challenge Account Country Selection
CGD's MCA Monitor takes a look at which countries pass the control of corruption indicator for fiscal year 2010.
With the U.S. Millennium Challenge Corp. (MCC) soon to release the scorecards and performance data that form the basis of the FY09 country selection round, Sheila Herrling and Amy Crone examine how countries fare on the control of corruption indicator, the only “hard hurdle” that countries must pass to qualify for MCC money, in this new MCA Monitor Analysis.
The U.S. Foreign Corrupt Practices Act is supposed to prevent U.S. corporations from giving bribes while conducting business abroad--bribes that encourage corruption in poor countries and stymie development. But some corporations use gaping loopholes in the law and its international counterpart, the OECD Convention on Combating Bribery, to win contracts and enjoy special advantages without fear of prosecution. Combating Corrupt Payments in Foreign Investment Concessions: Closing the Loopholes, Extending the Tools, a new report by CGD non-resident fellow Theodore Moran, describes the nature of these corrupt relationships and the harm they cause. It also offers suggestions on how to prevent them, including re-drafting the U.S. law and the OECD convention, tightening enforcement, and extending the Extractive Industries Transparency Initiative to other sectors and industries.
Developing countries, donor agencies, and private philanthropies devote about $500 billion a year to improve the health of people in the developing world. But the lack of timely, accurate information about how this money is spent is undermining its impact. This problem can be solved. A working group organized by CGD's Global Health Policy Research Network offers four specific recommendations. Among the findings: place the highest priority on responding to the needs of in-country decision makers and make full use of modern information management technology.
A Report of the Commission for Weak States and US National Security
Terrorists training at bases in Afghanistan and Somalia. Transnational crime networks putting down roots in Myanmar/Burma and Central Asia. Poverty, disease, and humanitarian emergencies overwhelming governments in Haiti and Central Africa. A common thread runs through these disparate crises that form the fundamental foreign policy and security challenges of our time. These crises originate in, spread to, and disproportionately affect developing countries where governments lack the capacity, and sometimes the will, to respond.
These weak and failed states matter to American security, American values, and the prospects for global economic growth upon which the American economy depends.