Careers in International Development Policy: - PowerPoint Presentation

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Careers in International Development Policy: What is the Frontier?

Valerie Kozel

(vkozel@wisc.edu)

Adjunct Associate Professor

La

Follette

School of Public Affairs

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Informal Discussion: how to start a career in international development

Based on my experiences at the World Bank and outsideAs well as… conversations with development practitioners (willing to answer your questions and queries)Pierre Fallavier: Chief, Social Policy, Policy and Monitoring at UNICEF in South Sudan (MIT urban and regional studies) Dean Cira: Lead Urban Specialist at the WB in Nairobi (La Follette)Brendan Brian Brady: Consultant at the World Bank (recent grad of Harvard Kennedy School)Including several here today e.g. Chris Russell: joint degree La Follette and UW law school, ex-Peace Corps in UkraineSteve Malpezzi: UW Professor, Real Estate and Urban Land Economics in the B-school, and ex-WB

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Widespread agreement: its a tough job market and breaking into development requires passion, persistence, and patience coupled with a lot of luck. There are things you can do to increase you chances… we will discuss some todayThere is an enormous amount of material on the web focused on jobs in international development includingWebsites providing guidance, with related job-boards (e.g. DevEx)Alanna Shaikh’s, Chris Blattman’s really helpful blogs e.g. http://chrisblattman.com/2009/04/20/getting-a-job-in-international-development/Conventional job boards e.g. ReliefWeb, UNJobFinder.org (good site, includes internships and entry level jobs), career pages run by firms e.g. Gates, Chemonics, DAI, etc. Facebook group “International Jobs for Young Professionals” with 116,900 (!) current membersCoupled with many articles, books, advice… Research and read! What can I add? General advice, but also some specifics:On the “international aid architecture”, ODA flows and aid providers (follow the money)On strategies for “building a career in development” -- with some personal stories e.g. from Chris, Steve – and personal contacts

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As a first step: Think it through…

Why do you want to work in development? “One of the greatest accomplishments of the past 50 years—the massive drop in the number of child deaths from 20 million children in 1960 to 8.1 million deaths last year—is an example of the tremendous progress we’ve made, in large part, thanks to foreign assistance. If the world comes together on a plan for financing development, the impact on health and development will be enormous.” (Bill Gates, April 2011)Do not be seduced by promises of privilege, grand benefits, and high salaries: that aspect of development work is gone/fast disappearingWhat kind of work do you want to do, in what role? (be deliberate! And think longer term)Diplomatic and administrative (working for/with governments)Technical expert, including program managementHumanitarian aid (the classic “aid worker”)On which issues (what are the hot issues in development?) and in what settings? Finance and macro; business innovation, private sector development; energy! Service “basics” – health, education, water and sanitation BRICs? Conflict affected countries, fragile states?

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Then explore… Which agencies/firms do that kind of work? What skills do you need, how can you equip (and distinguish) yourself substantively from 1000s of other job seekers? specific skills are particularly important for internships, entry level jobsWhat are effective approaches towards getting a job in the field?Job boards are good for knowing what’s out there, but personal contacts are still the main route into jobs, esp entry level jobs.NETWORK!Lots of good advice online i.e. start with modest expectations, volunteer, be willing to do office, work, be flexible, passionate about change (but not about salary and benefits…) and so on. Come across as a sound potential team member with interesting skillsWill come back to this…Two things to keep in mind:There are lots of people out there with extensive country experience, language, and good technical skills (116,000+ on the FB page). Many also with project management experience: what can you bring that is new? Entry level jobs are increasingly going to local staff, also increased south-south hiring. This is different from when I entered the field.

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Learn about how the aid system works: much development work is financed by “foreign aid”

Foreign aid includesFinancial flows, technical assistance, and given by one country (donor) to another country (recipient) either as grants or subsidized loans. Can be given or received by governments, charities, foundations, businesses, or individuals Development Assistance Committee (DAC) of the OECD is international organization that tracks ODA flows. 30+ industrialized countries belong to the OECD, including most of the major donor countries According to the DAC, foreign assistance must meet two criteria to be counted as aidDesigned to promote economic development and welfare as main objective (military aid excluded)Provided as a grant or heavily subsidized loan Referred to as “concessional assistance”, if loan then grant element much be 25% or more (ref. WB IDA lending on highly concessional terms qualifies)

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There are different categories of “aid”

Official Development Assistance (ODA) is aid provided by DAC donor governments to low and middle income countries for development purposesBilateral, national aid programsMultilateral (UN organizations, WB, ADB, also regional banks)Private Voluntary Assistance is another important source increasing rapidly—including (some) humanitarian assistanceChurches, faith based organizations have been involved for decadesMore recent, rapid expansion of assistance provided by INGOs e.g. Save the Children, Oxfam, World Vision and foundationsAnd new foundations like Gates, which current provides more than $1 billion in support primarily for education and health research and programs in low income countries. In recent years, private assistance is estimated to provide countries with as much as half to two-thirds increase over official development assistance (ODA)But private assistance is not counted in ODA, which is limited to “official” sources

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Who gives ODA?

Most ODA (80%) is given in the form of bilateral assistance from one country to another Typically through bilateral development agencies e.g. USAID, DFID, JICA, CIDA, SIDA, Saudi Fund for International DevelopmentMany countries e.g. the U.S. have multiple aid agencies e.g. USAID, Millennium Challenge Corp, Depts of Agriculture Defense, Health and Human Services, Census, also Peace CorpsSome aid provided in cash, but 70-75% is provided in goods (e.g. agriculture products, medicines) and services (technical assistance)Big push-back in recent years against “tied aid”, food aid, and use of TA (expensive consultants and travel)Many “aid conscious” donors no longer allow tied aid, good in many respects but also problematic given.. Ongoing shift from pure-development objectives to more commercial interests in defining relationships between rich and poor countriesEven true e.g. for Norway in terms of its relationship with Vietnam (example)

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Net Official Development Assistance (ODA)(USD millions, 2012 – WDI)

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ODA donor-country estimates (previous slide) also includes multilateral aid

Countries provide bilateral (direct) ODA as well as (indirect) aid through multilateral institutionsMajor institutions includeWorld Bank, IMF, MIGA and IFCUN organizationsEuropean Union (EU) institutions, including the ECRegional banks e.g. AfDB, ABD, IADBDifferent rationales for multilateral aid, but generallyLess tied to national interests, politics (no longer accept tied aid)“whole-sale” provision, lower overhead costs. Global harmonization of aid, shared global objectives

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World Bank is the largest multilateral aid institution

Initially the International Bank for Reconstruction and Development (IBRD), founded at the Bretton Woods conference in July 1944To finance the reconstruction of Europe after WWIIShifted to focus on countries outside Europe with the advent of the Marshall Plan (1947), until 1968 focus on building economic infrastructure – e.g. ports, roads, irrigation systems1970s, revised focus on basic needs including education and healthMcNamara introduced focus on poverty 1980s, difficult era of structural adjustment, expanded lending to Africa1990s through presentMore diversified lending portfolio, more open processes (in response to harsh criticisms in 1980s), greater focus on environment, social concerns

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More WB…

World Bank is heavily dominated by US interests, with strong ties to the US treasuryAll WB presidents are US, nominated by the US presidentBeginning to change with in response to changing distribution of wealth, changing global financial flows (including but not limited to aid flows)World today looks very different than 1970s/80sWorld Bank consists of five affiliated institutions operating in 100+ countries (20,000+ staff and consultants)IBRDInternational Development Association (IDA)International Finance Corp (IFC)Multilateral Investment Guarantee Agency (MIGA)International Center for Settlement of Investment Disputes (ICSID)Most funding provided by the WB is not aid IBRD lends to middle income countries at market ratesBorrows from international capital markets, relends to developing countries at cheaper rates than countries can obtain directlyBut demand for IBRD loans has been falling, esp as countries progress, become more creditworthy and can access international marketsWB has becomes lender of last resort. Increasing exposure in poor, conflict affected and fragile states

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IDA provides aid through grants and highly concessional loans

Donor countries (primarily DAC but increasingly others) contribute funds to IDA (referred to as IDA replenishment), which are used to provide concessional loans and grants to IDA eligible countriesIDA eligible – GNI per-capita less than $1215 (2015)IDA gives grants plus loans on concessional terms e.g. 25-38 year repayment period, 5 year grace period, initiation fee of only .75%, low interest scheduleAnnual lending envelopes determined by Country Policy and Institutional Assessments (CPIAs) But there is a lot of momentum in the system, process not transparentCurrently 59 IDA only countries, 18 blend countries (based on creditworthiness), plus India (can access IDA on “exceptional basis” through 2017)Several countries that receive high ODA are included on the “blend” list i.e.Ethiopia, Pakistan, Nigeria, Vietnam, Zimbabwe Countries with the biggest “exposure” (outstanding IDA loans and commitments) China, Brazil, Turkey, India, and Indonesia (concessionary, no rush to repay)

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World Bank led by share holders

World Bank controlled by 188 member governments (share holders) with voting shares determined by capital contributions. Referred to as “the Board”. CurrentlyUSA is largest share holder with 10.3% voting share (reduced substantially from 16% in early 2000s)Japan is second with 8.6%UK with 6.1% Germany with 5.5% France with 3.7%China with 2.1%Followed by regional groups of countries, each having 4-5% voting sharesThe Board, chaired by the WB president, decides on major policy directions, reviews all (major) loans and grant agreements. Very political environment, changing as geo-politics and geography of wealth changes (e.g. China is now a full voting member, also in ADB board)US is the only country with veto power… but much less likely to exercise it in recent years.Controversial loans don’t make it to the Board

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Other multilateral donors…

Some of the regional banks have a strong development focus i.e. AfDB, ADB, IADBAlso new Asian Infrastructure Development Bank (China)These operate in a similar way to the World Bank but with regional focusProvide concessional and non-concessional financing to countries in their region of focus, through regional contributions/share-holdersADB is largest (in terms of lending)Set up in 1966, membership limited to UNESCAP countriesCurrently 67 member countriesJapan has largest voting share, president is always Japanese Aid also provided by other agencies, for example the EU, OPEC fund, and Islamic Development Bank

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Other UN Organizations

Wide range of other UN organizations that play a role in global development efforts, often linked to specific issues e.g. IFAD, ILO, FAO, UNESCO, UNIDO etc UN organizations have a range of foreign assistance programs, but considerably smaller than the WB and IMF Much of this assistance comes in the form of technical cooperation (consultants, advisors) under the guise of UNDP, UNFPA, WHOOr humanitarian assistance, development projects through the WFP, UNICEF, and UNHCR (UN High Commission for Refugees)

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Trends in ODA, 1960-2008 (OECD DAC)

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http://www.oecd.org/dac/stats/documentupload/MeasuringAid50yearsDACStats.pdf

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DAC members total net resource flows to developing countries 1970-2009 (OECD DAC)

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http://www.oecd.org/dac/stats/documentupload/MeasuringAid50yearsDACStats.pdf

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The distribution of ODA receipts from DAC countries 1978/9-2008/9

The geographic distribution of aid responds to changing needs as well as to changing political imperatives.Note reduction in aid flows to East Asia and Pacific countries as well as to South Asia, coupled with sharp increase to sub-Saharan Africa. Rise in aid to Europe and Central Asia reflects the emerging global financial crisis in 2008-9.

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Aid allocation based on income classifications 1960-2009

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From Easterly

and Williamson,

2011, Figure 9

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ODA has increased in sub-Saharan Africa, low income countries more broadly (2012)

2012 Net ODA ($ millions) 2012 ODA/capita2012 ODA as % of GNISubsaharan Africa46,274513.1South Asia14,17190.6East Asia and Pacific8,79640.1Europe and Central Asia9,970370.5Middle East and North Africa13,89441naLatin American and Caribbean10,091170.2Low Income39,333477Low-middle Income38,964150.8upper-middle Income15,59570.1

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http://www.oecd.org/dac/stats/documentupload/MeasuringAid50yearsDACStats.pdf

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Is it all about economic development, reducing poverty?

Huh. ODA is dominated by bilateral aid. It should surprise no one to find that ODA is also dominated by (bilateral) foreign policy objectives, political alliancesCountries provide significant aid to their former coloniesUS aid (including ODA) reflects geo-political concerns Egypt and Israel historicallyMore recently Afghanistan, Pakistan (also in 80s), South Sudan, Iraq (declining, shifting to Afghanistan)Development and poverty reduction matters, at least for some donors, also for multilateral institutions (e.g. IDA, UN agencies)Greater focus on harmonization of aid, sectoral programs Country size is relevantSome donors (and multilaterals) try to improve aid effectiveness through greater selectivity on countries (esp smaller countries) and sectorsStrengthen fragile democracies, transition to democracy and democratic institutionsCommercial interests, strengthening trade ties are increasingly important in rising middle income countriesLets look at the evidence—which countries received the most ODA in 2012?

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Major ODA recipients – ranked by overall ODA flows in 2012

Net ODA ($ millions) ODA/capitaODA as % of GNIAfghanistan 6,72522532.6Vietnam 4,118462.8Ethiopia3,261367.5Turkey3,033412.4DRC2,8594410.3Tanzania2,8325910.3Kenya2,654615.3Cote d’Ivoire2,63613310.1Bangladesh2,152141.5Mozambique2,0978314.0Pakistan 2,019110.9West Bank Gaza2,00149516.5Nigeria1,916112.5Ghana1,808714.6

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Major ODA recipients (cont)

Net ODA ($ millions) ODA/capitaODA as % of GNIEgypt1,807220.7Syria1,67275..South Sudan1,57814615.9Morocco1,480461.6Iraq1,301400.6Serbia1,09015112.7Zimbabwe1,001738.7

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Source: http

://data.worldbank.org/indicator/DT.ODA.ALLD.CD

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The quality of ODA is improving: Reductions in share of aid through ineffective channels, 1979-2007

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F

rom Easterly

and Williamson,

2011, Figure 10

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Aid is only one way that rich countries affect poor countries…

And (according to Deaton) probably the least important wayHighlights importance ofFDI, private investment flowsRemittances, migrationFlow of ideas, technology and basic science e.g. vaccines, medical equipment. Cell phones! Lifting trade restrictions, ensuring poor countries have access to international markets

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What does this mean for your job search?

Again, be deliberate, fit your interestsMost Official Development Assistance (ODA) comes with (many) strings—in terms of country and sectoral/strategic focus. Do these mesh with your interests?Ref: USAID Foreign Assistance Dashboard to learn about where US foreign aid goesPrivate Development Assistance (PDA) comes with different strings: are these a better fit for you? Look into some of the big West Coast NGOs e.g. GatesAnd there are increasing opportunities in the private sector… to work globally, in different country contexts and settings. Do these fit your career objectives?Consulting firms, private business is not a bad place to develop skills and get experience

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Suggestions on strategies to equip yourself to be competitive in “your” job market? (including from my sources)

Cultivate specific sectoral expertise and knowledge through your course work, even if only one or two classes Also Learn a specific skills e.g. check USAID website on performance monitoring.Develop and nurture good writing skills, learn to make sharp and focused presentationsFind volunteer positions, internships in your chosen area of expertise (spring break, summers). Be willing to do desk work initially, you don’t have the field skills to compete with more seasoned job applicantsUN, World Bank have small, very competitive internship programsRead voraciously, keep abreast of current events and news in your country/regionReally go for it…Choose a region/country, travel there, volunteer and network. Or, join the Peace Corps, seek internships e.g. with UN organizations, non-profits.

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