A UNDP-sponsored Development Finance Assessment (DFA) mission commissioned by the Benin government was held in Cotonou on 10-21 September 2018. Following an introductory mission in June 2018 which launched the study, this mission prepared for the third and fourth ones scheduled to be completed by the end of the year. 

DFI supported OIF in preparing the participation of the Madagascar government at the Caucus meeting of African Governors of the IMF and World Bank, held in Sharm-el- Sheikh. Madagascar spoke on behalf of the OIF network and presented the recommendations of the 28 governments in that network to reduce costs and risks, increase budget revenue mobilisation, and improve transparency and accountability of public-private partnerships. The recommendations of the network were included in the final memorandum of the Caucus which will be discussed with the heads of the Bretton Woods Institutions at the African Governors’ meetings with them at the BWI Annual Meetings in Bali in October.

DFI and the Commonwealth Secretariat signed an agreement making DFI the sole authorised distributor of the CS-DRMS debt recording and monitoring system for non-Commonwealth countries. There are currently 18 countries using the system, 11 in English and 7 in French versions. The contract will allow DFI to provide all the support needed by these countries in ensuring CS-DRMS supports their debt management effectively, as well as being open to supporting additional non-Commonwealth countries which apply to use the system.

This support will include an annual hotline support contract and end-user license agreement, as well as any additional support needed in installation, maintenance or training by individual countries. DFI also aims to reinforce feedback mechanisms between the non-Commonwealth user group and the Commonwealth Secretariat, so that their needs and priorities can be systematically taken into account. Finally, DFI will assist the countries in transitioning to the new Meridian system which will replace the CS-DRMS from April 2019, and contains major improvements in recording guarantees, contingent liabilities and domestic debt, as well as linking debt management to broader work cycles in Ministries of Finance and Treasuries, and more user-friendly interfaces and reports.

The Friends of Monterrey, through their co-chairs the Governments of Germany and Mexico, have contracted DFI to review the impact of the Financing for Development process, following on from the Addis Ababa Conference of 2015. The study will suggest ways to enhance its impact on and coherence with other UN processes and agencies, and especially on progress in finding sustainable financing solutions for the SDGs at country level.

The study began in July, and has involved interviews with 20 key institutional stakeholders and global analysts of financing for development. At a side-event at the High-Level Political Forum on 18 July in New York, DFI presented the key issues to be examined in the study, which is being finalised by September.

DFI assisted OIF to organise and support the participation of Francophone policymakers at the World Bank infrastructure governance roundtable in Abidjan. Officials and parliamentarians transmitted the concerns of the OIF Finance Ministers’ Network about the need to reduce the costs and risks of public-private partnerships for infrastructure, and to maximise their transparency and accountability to citizens and parliaments.

Following DFI’s work as a global advisor on Development Financing Assessments and lead consultant for Cameroon and Comoros, UNDP has also selected DFI to lead the work on Benin. The study began with a launch mission to Cotonou which conducted initial consultations with leading government Ministers and officials, as well as other stakeholders.

The mission agreed the key priorities in terms of sectors with major financing gaps, types of financing where the government needs more assistance with mobilisation, and institutional capacity-building support which will be required to improve mobilisation and management of financing.

The next mission will take place in September, and the report is expected to be finalised by December.

DFI attended the EURODAD Policy Forum in Brussels and made a keynote presentation on Current and Potential Global Financial Crises, and how we can resolve or prevent them.

DFI’s presentation focussed on the existing widespread debt crisis crowding out SDG spending; the growing crisis of falling and less effective aid flows; the potential tax revenue crisis if global tax dodging and the race to the bottom on tax rates is not stopped; and the potential crisis which might be caused by excessive financialisation and privatisation of public services and infrastructure in developing countries. Participants from European and Southern CSOs then spent a day strategising and planning future work on to resolve current or prevent future financial crises.

DFI attended the Tax Conference held in Stockholm, assisting African governments and CSOs to prepare and make presentations in various sessions. The conference produced a declaration which could potentially mark a major reinforcement of the Addis Tax Initiative and global efforts to increase revenue mobilisation in developing countries, especially as it emphasises the need to make tax systems more progressive, more gender-responsive, and more transparent and accountable to citizens, parliaments and civil society.

DFI and OIF intend to join the Addis Tax Initiative to ensure that the views of low-income countries are even more clearly heard in its future deliberations.

DFI attended the World Bank Debt Management Facility Stakeholders Conference in Brussels. After participating in the Implementing Partners Consultative Group (ICG) meeting, DFI presented in a session on How Can Countries Be More Resilient to Shocks? The presentation suggested that most shocks are not shocks at all, but predictable; that we know exactly what to do about them from past experience; and that this involves the international community and the Bretton Woods Institutions playing a leading role in regulating to prevent shocks, in providing social protection funding to the poor to make them genuinely resilient, and in providing unconditional and highly concessional financial support to poorer countries to offset the effects of shocks, because they will never be resilient enough to “adjust” to their consequences given their poverty and vulnerability.

At the Spring Meetings, the IMF organised a conference on “Splitting the Riches” which explored whether and how it would be possible to apply unitary taxation on multinational companies, analysing their accounts globally and country-by-country, and then apportioning the resulting tax revenues among different countries where each company is based using formulas based on value added, employment and other factors.

The overall conclusion of the day was that is potentially desirable and technically feasible to use these methods, especially to combat profit-shifting by multinational enterprises. However, whether they are implemented will depend on the political will of different countries’ tax authorities to cooperate closely – the strongest perspectives being in the EU.