{"id":55545,"date":"2022-05-12T10:50:05","date_gmt":"2022-05-12T10:50:05","guid":{"rendered":"https:\/\/revistaidees.cat\/?p=55545"},"modified":"2022-05-12T10:50:08","modified_gmt":"2022-05-12T10:50:08","slug":"rethinking-decentralised-development-cooperation-in-light-of-the-covid-19-pandemic","status":"publish","type":"post","link":"https:\/\/revistaidees.cat\/en\/rethinking-decentralised-development-cooperation-in-light-of-the-covid-19-pandemic\/","title":{"rendered":"Rethinking Decentralised Development Cooperation in light of the Covid-19 pandemic"},"content":{"rendered":"\n

Decentralised development co-operation (DDC) lacks a harmonised statistical definition and is often embodied in diverse legal frameworks and governance structures that vary according to levels of decentralisation across countries. Attempts to provide a unifying definition of DDC often fall short of capturing the diversity of actors involved and their value-added to deliver development co-operation and finance in support of sustainable and inclusive development and recovery.<\/p>\n\n\n\n

DDC can include activities beyond aid, or what is counted as Official Development Assistance (ODA) flows [1]<\/a>1 \u2014 Thirty DAC members, twenty non-DAC providers and more than 40 multilateral institutions report on annual basis data on ODA and beyond. Each year, more than 250 000 transactions are presented in a detailed manner in Creditor Reporting System (CRS). Quality assurance makes the DAC the only source of reliable, comparable and complete data on development assistance.\n<\/span><\/span>. In 2005, a first OECD report defined DDC as, \u201cAid extended by the public sector other than the central government\u201d [2]<\/a>2 \u2014 While the number of countries reporting on DDC has grown from 9 to 13 DAC members, fewer than half DAC members report on DDC to the Creditor Reporting System (CRS). Until recently, Germany was the only OECD DAC member to report on DDC provided by individual cities and regions and achieved 100% coverage of the 16 Lander, i.e. 3 city-states and 13 Federal States began in 2014. In 2018, Spain introduced 17 new agency codes to disaggregate reporting by autonomous governments.\n<\/span><\/span>. While ODA is the most comprehensive measure of DDC, it captures a more narrow set of official concessional resources (grants and soft loans) that promote and specifically target the economic development and welfare of developing countries, and can include certain costs and activities which take place within donor country borders (e.g. development awareness, hosting refugees, student scholarships, etc.). In contrast, many DDC approaches have a greater focus on reciprocity, mutual benefit, and knowledge sharing which moves away from the North-South paradigm. Moreover, DDC is not only carried out between subnational to subnational actors. Civil society, universities, multilateral organisations, private sector, etc. all play a prominent role in supporting projects at the subnational level. Finally, financing can also be provided by subnational to national levels such as when regional governments like Flanders provide direct funding to developing countries\u2019 national governments [3]<\/a>3 \u2014 See:\n\nECD (2018) Reshaping Decentralised Development Co-operation: The Key Role of Cities and Regions for the 2030 Agenda, OECD Publishing, Paris [Available online].\nOCDE (2019) Decentralised development co-operation. Unlocking the potential of cities and regions. Paris: OECD Publishing [Available online].\n\n<\/span><\/span>.<\/p>\n\n\n\n

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Many DDC approaches have a greater focus on reciprocity, mutual benefit, and knowledge sharing which moves away from the North-South paradigm<\/p><\/blockquote>\n<\/div>\n\n\n\n

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With these broader components in mind, it is important to recognise the opportunities and potential strength that DDC modalities offer to complement traditional means of development co-operation. DDC delivers technical competencies for public service delivery in areas where cities and regional governments have added value such as health services provision, education, water and sanitation, promoting gender equality, tackling climate change, etc. Many partnerships also reflect longstanding commitment to development co-operation. For example, the Basque Country has its own aid agency since 2007 with a budget and strategy to promote international development co-operation. When international co-operation is carried out by local actors, their impacts are felt closer to the daily lives of citizens. They carry out development education and awareness raising which helps to communicate and translate global objectives like the Agenda 2030 for sustainable development into local reality.<\/p>\n<\/div>\n<\/div>\n\n\n\n

Cities and regions in developed and developing countries are faced with uneven impacts due to COVID-19<\/h5>\n\n\n\n

The COVID-19 pandemic brings unprecedented challenges to finance sustainable development and risks major setbacks to the sustainable development goals, particularly in the poorest countries. With over 100 countries in lockdown, the COVID-19 pandemic brings with it the third and greatest economic, financial and social shock of the 21st century, after 9\/11 and the global financial crisis of 2008. This shock brings a halt in production in affected countries, hitting supply chains across the world, a steep drop in consumption together with a collapse in confidence and, finally, a sharp decline in services that reflects the consequences of lockdowns and social distancing, especially in urban settings.<\/p>\n\n\n\n

Many developing countries who already faced an SDG financing gap of USD 2.5 trillion annually, are now grappling with heightened volatility of external private investment and increased debt distress. External private finance to developing countries in 2020 dropped by 20% compared to 2019 levels. While OECD countries expect to see growth return to pre-crisis levels, many developing countries are will not recover for several years. Poverty levels have also increased for the first time since 1990s moving the world further off-track.<\/p>\n\n\n\n

The pandemic knows no borders. Covid-19 had a strong and diverse territorial impact that might exacerbate the already existing huge territorial disparities within and across countries. Regional and national governments are focusing on responding to the pandemic and designing recovery measures for the medium and long term. Governments\u2019 priorities have drastically changed and their human and financial resources are focused on addressing the crisis.<\/p>\n\n\n\n

Many of local and regional governments in developing countries lack health system capacities. Uganda has only 0.1 ICU bed\/100,000 population. In contrast, the United States has 34.7 beds\/100,000 population. The IMF indicates that emerging markets alone could require an additional USD 2.5 trillion for their Covid-response, potentially doubling the SDG financing gap. Developing countries are facing worse conditions than after the GFC, many have entered the COVID-crisis with higher debt levels, debt servicing costs and with a greater share of private debt.<\/p>\n\n\n\n

Cities and urban settlements in developing countries are most affected by the sanitary crisis, and are also likely to suffer most from the economic crisis. Indeed, in developing countries, urban areas face higher risks related to COVID. For example, the Accra region in Ghana accounts for 3,981 cases out of a total 5,127 (or 78% of all cases)<\/a>. A third of national GDP (31%) comes on average from the largest city in African countries.<\/p>\n\n\n\n

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COVID-19 has had a wide and diverse territorial impact that can aggravate the great territorial inequalities that already exist both in and between countries<\/p><\/blockquote>\n<\/div>\n\n\n\n

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However, per capita expenditure of African local authorities are among the lowest in the world at USD 26. In addition, while the overall response to COVID-19 is often co-ordinated by the central government, sub-national governments have a key role to play to raise awareness and communicate with citizens, ensure continuity of local public service delivery, support business recovery, support vulnerable groups, but also enforce nation-wide measures related to physical distancing and working patterns.<\/p>\n<\/div>\n<\/div>\n\n\n\n

Now more than ever innovative approaches such as DDC should be leveraged to \u201cbuild back better\u201d placing people and planet at the heart of financing<\/h5>\n\n\n\n

The Addis Ababa Action Agenda raises the urgency to address growing financing and capacity needs at all levels of government in developing countries (para. 34) Fifteen cities from mainly developed countries hold 11% of the world\u2019s wealth or USD 24 trillion (Desjardins, 2018). Thirty of the thirty-five most rapidly growing cities are in least developed countries. Urban infrastructure including water, electricity, housing, etc. is costly and complex to carry out effectively. ODA provided by OECD DAC national governments in support of cities and regions in developing countries remains at only 1.3% of total bilateral ODA. As cities gain access to greater financing, redistribution efforts are needed to ensure inclusive growth across urban and rural areas. Development co-operation can support national capacities to redistribute wealth.<\/p>\n\n\n\n

Decentralised Development Co-operation (DDC) provides an opportunity to leverage scarce ODA resources to support recovery following the pandemic. Following the great financial crisis in 2007-09, from 2012 to 2019, DDC volumes provided by DAC members grew from USD 1.5 billion to nearly USD 2.5 billion, or by 7% on average annually (USD constant prices, net disbursements). In five OECD DAC countries, DDC represents 5% or more of total bilateral ODA across several DAC members – Austria (23%), Canada (14%), Spain (16%), Belgium (7%) and Germany (6%). The increasing trend reflects the waves of territorial redefinitions generated by the 2008 financial crisis, resulting in fiscal consolidation and an impact on DDC legal and institutional frameworks. Many central governments-initiated processes of responsibilities, resources and authority transfer from top to bottom levels with a search for lower costs, as well as empowerment of subnational governments, better service delivery, governance and citizens trust.<\/p>\n\n\n\n

These aid trends reflect the important role for cities and regions to respond globally to the pandemic. Subnational actors were strong supporters of SDG 3 \u201cGood Health and Well-Being\u201d even before the crisis. Aid provided by subnational actors to health-related sectors averaged USD 113 million annually over the past decade. In 2018, DDC health sector financing represented 5% of bilateral allocable DDC or USD 103 million [4]<\/a>4 \u2014 OCDE (2019). op. cit.\n<\/span><\/span>.<\/p>\n\n\n\n

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As cities gain access to greater financing, redistribution efforts are needed to ensure inclusive growth across urban and rural areas<\/p>

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Figure 1 shows that DDC makes an important global contribution to SDG 3 \u201cGood health and well-being\u201d in addition to other major areas such as SDG 11 \u201cSustainable Cities and Communities\u201d, SDG 2 \u201cZero Hunger\u201d, SDG 4 \u201cQuality Education\u201d, SDG 5 \u201cGender Equality\u201d, SDG 16 \u201cPeace and Justice\u201d and SDG 6 \u201cClean Water and Sanitation\u201d. The SDG alignment of DDC could help to ensure the value-added of DDC expertise across different sectors. The use of OECD Creditor Reporting System (CRS) demonstrates the strong focus of DDC activities in climate and gender sectors.<\/p>\n<\/div>\n<\/div>\n\n\n\n

Figure 1. Decentralised Development Co-operation provides financial support and expertise across the SDGs (2015-16 averages, excludes in-donor costs, net disbursements).<\/h5>\n\n\n\n
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Source: OECD SDG Financing Lab <\/a>
Note: In-donor costs are excluded from the SDG breakdown of DDC to better reflect the amounts that crosses borders at the subnational level, including administrative costs, imputed student costs, promotion of development awareness, research and refugees in donor countries. For further explanation of the methodology and definition see the online link.<\/a><\/figcaption><\/figure>\n\n\n\n

Figure 2 shows that three subnational governments provide more than half of total DDC health sector financing. These include Flanders Official Regional Ministries (23%), Canadian International Development Research Centre (21%) and the Autonomous Community of Catalonia (9%). However, several other subnational governments also represent a significant share of the total, including Swiss Cantons and Municipalities (8%), City State of Hamburg (6%), and Spanish municipalities (5%).<\/p>\n\n\n\n

Figure 2. The bulk of DDC support to the health sector in developing countries is provided by a few subnational actors (USD 2018, net disbursements, bilateral allocable ODA).<\/h5>\n\n\n\n
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Source: OECD Creditor Reporting System (CRS). Accessed 25 March 2020.
Note: France does not report DDC figures disaggregated by French territorial authorities to the OECD CRS database.<\/figcaption><\/figure>\n\n\n\n
Leveraging expertise and know-how through DDC to build back greener, fairer and smarter cities and regions\u202f<\/h5>\n\n\n\n

Over the mid to long-term, DDC could be instrumental to build back better. Beyond global health, DDC is a longstanding support mechanism for other global public goods that can promote resilience to the health pandemic, such as climate change adaptation and gender equality and women\u2019s empowerment [5]<\/a>5 \u2014 The main thematic areas of DDC include climate change (USD 41 million in 2014-15) and gender equality and women\u2019s empowerment (USD 163 million in 2014-15). OECD (2018), Reshaping Decentralised Development Co-operation: The Key Role of Cities and Regions for the 2030 Agenda, OECD Publishing, Paris, [Available online].\n<\/span><\/span>. In addition to financial aid, cities and regions in donor and partner countries can support each other though the exchange of knowledge and good practices<\/a> to build back a more sustainable \u201cnew normal\u201d.<\/p>\n\n\n\n

Greener cities and regions.<\/em> DDC can contribute to strengthening the transition to a low-carbon economy. Key actions from cities and regions should include:<\/p>\n\n\n\n