Emerging Markets

Emerging Voices features contributions from scholars and practitioners highlighting new research, thinking, and approaches to development challenges. This article is from Amit Chandra, an emergency physician and global health consultant based in Washington, DC. This year marks the end of the fifteen-year Millennium Development Goal (MDG) framework. The health MDGs focused on single, discrete issues including hunger, maternal and child health, and major infectious diseases, and they successfully targeted the spread of HIV and tuberculosis. Slated to replace the MDGs, the Sustainable Development Goals (SDGs) similarly focus on single issues—hunger, sanitation, and an expanded list of key diseases. Continuing this approach fails to address today’s global health challenges, in particular rising mortality associated with non-communicable diseases (NCDs), road traffic accidents, and Ebola-like infectious disease epidemics. To combat these threats, we need to strengthen countries’ entire health systems, specifically incorporate data to identify problems, expand technical capacity, and boost financial and human resources for health. In many developing countries, health systems now face the dual burden of NCDs and persistently high rates of infectious diseases like HIV, TB, malaria, and tropical diseases. Studies estimate that over 900 million people in developing countries have high blood pressure, though only one third of them (300 million) are aware of their disease, and only one third of those aware (100 million) are currently on treatment. Unlike with most infectious diseases, people can live for years with high blood pressure, diabetes, or early stages of cancer without symptoms. Many in the developing world lack access to primary care, and so their first contact with a doctor may only occur when their conditions escalate. In this way, weak health systems turn  preventable and treatable chronic diseases into silent killers. Tackling NCDs requires universal primary health systems that provide prevention, screening, and treatment services to entire populations, not just to the few identified with a particular disease. Health systems also matter for lowering traffic fatalities. Road traffic accidents cause over 1.24 million deaths per year worldwide. In the developing world, an injured person lying on the roadside often depends on bystanders for transport to the nearest hospital, which is unlikely to provide surgical care. A robust health system would enable coordination between health, law enforcement, and public policy leaders to reduce traffic fatalities. Take Rwanda for example. In 2001, the country had one of the highest traffic fatality rates in the world. To address this problem, the government passed mandatory seat belt and helmet laws, increased enforcement of speed limits, and implemented a public awareness campaign. Drivers of motorcycle taxis, a popular method of transport, are even required to carry an extra helmet for their passengers, which they sling over their elbows while looking for customers. As a result, road traffic deaths fell by over 30 percent. On a recent trip to Kigali, I was impressed to see near universal helmet use among motorcycle drivers and passengers. The absence of adequate health systems can permit novel, unexpected infectious disease outbreaks to escalate and spread. The recent Ebola epidemic in West Africa—often cited as an example of the failure of the World Health Organization (WHO)—is first and foremost a failure of the national health systems of the three countries most affected by the disease. Guinea, Liberia, and Sierra Leone’s inability to effectively respond to the initial outbreak led directly to the spread of the disease. Too few hospitals and clinics, a dearth of doctors and nurses, and limited public outreach capacities contributed to a climate of misinformation and a breakdown of public services. Preventing future outbreaks will require more than a WHO emergency fund; it will require national health systems capable of detecting, treating, and isolating a surge of sick and exposed patients. Now, as we determine the scope of the SDGs, we have an opportunity to strengthen health systems. National governments should be encouraged to provide basic health services to their populations. The global health community can support this effort by financing health management training and an expanded health provider workforce. To quote the UN Secretary General’s report on the SDGs, meeting these goals by 2030 will require that we “…act, boldly, vigorously and expeditiously, to turn reality into a life of dignity for all, leaving no one behind.”    

This is the third post of a new series on the Development Channel, "This Week in Markets and Democracy." Each Friday, CFR’s Civil Society, Markets, and Democracy Program, will highlight the week’s noteworthy events and articles. Anticorruption Campaign in China This Thursday, China’s anticorruption campaign reached a new level, sentencing for the first time a former member of the Politburo Standing Committee, the Communist Party of China’s executive body. Zhou Yongkang, also ex-domestic security chief, received a life sentence for accepting $118,000 in bribes and leaking state secrets. Since 2012, over 400,000 high- and low-ranking Chinese officials have been disciplined and over 200,000 prosecuted for graft related infractions. The U.S. Department of State has even agreed to extradite about 150 Chinese officials wanted for corruption. President Xi Jingping has explicitly outlined bribery prohibitions for bureaucrats and required officials and their families to disclose financial assets and income. Anticorruption efforts date back to the founding of the People’s Republic of China in 1949. But, as CFR’s Elizabeth Economy points out, Xi’s campaign is singular; it has been swift and broad reaching. With bribery and influence peddling endemic, Xi’s campaign has the potential to reduce graft. Yet, the reforms are also a means for Xi to consolidate political power. Mediterranean Migration Crisis The European Union (EU) announced this week that it will delay its formal comprehensive response to the Mediterranean migration crisis until the fall. In the last six months, over 100,000 refugees and migrants traversed the Mediterranean to Europe. So far, nearly 2,000 have perished en route (including 1,000 who drown off the coast of Italy in April), and the International Organization for Migration predicts the number could rise to 30,000 by year end. The sticking point seems to be how to redistribute migrants across EU member-states, reducing the disproportionate burden that Mediterranean countries such as Italy and Greece bear. Eastern countries, including Poland and the Czech Republic, argue that they don’t have the state capacity and resources to take in and attend to refugees. France and other more affluent states are concerned that redistribution quotas won’t take into account migrant and refugee populations already living within their borders. With no resolution, naval search and rescue patrols are left to stave off further tragedies. World Day Against Child Labor Today, the International Labor Organization (ILO) marks World Day Against Child Labor with calls for governments to deliver free, quality education for children and to enforce minimum employment age laws. Currently, over 100 million primary and secondary school age children are out of school, and 168 million are child laborers. Excluded partially or wholly from education, child laborers are more likely to face difficult employment prospects later in life, a recent ILO study shows. Previous research has identified household poverty as a primary driver of child labor, compounded by conflict and crisis. As long as poverty and conflict persist, so too will these practices. Turkish Election Results On Sunday, predictions that President Recep Tayyip Erdogan’s Justice and Development Party (AKP) would win Turkey’s parliamentary election, paving the way to constitutional reforms that would concentrate more political power in Erdogan’s hands, failed. Instead, the AKP lost its majority in Parliament, beat by pro-Kurdish and nationalist parties. This loss is particularly notable as it seemed that nothing would stop Erdogan’s bid to consolidate power. For insight into how the electoral upset will play out in Turkey, read Hasib J. Sabbagh Senior Fellow for Middle Eastern Studies Steven Cook’s analysis.

This is the second post of a new series on the Development Channel, "This Week in Markets and Democracy." Each Friday, CFR’s Civil Society, Markets, and Democracy Program, will highlight the week’s noteworthy events and articles. 1. Updated Rule of Law Index The World Justice Project (WJP) released its annual Rule of Law Index this week. The Index scores and ranks 102 countries based on their performance on eight categories including levels of corruption, constraints on government powers, and regulatory enforcement. The scores are based on 2,400 expert testimonies and over 100,000 household surveys. Predictably, Denmark, Finland, and other European states top the list, while Venezuela, Afghanistan, and Zimbabwe bring up the rear. Corruption is a huge drag for emerging economies. It costs developing countries an estimated $1 trillion annually. As the Rule of Law Index shows, corruption mostly comes from governments—whether a police officer extorting a payment or a public official asking for money to provide basic public services. Good governance and robust rule of law are critical to economic growth and democratic consolidation in emerging countries. As the Rule of Law Index suggests, there is much room for reforming judiciaries, police, and public administrations in the developing world. 2. Corporate Tax Evasion Deprives Developing Countries In advance of the Group of Seven (G7) annual summit in Germany, international and civil society organizations are urging international tax reform. According to the International Monetary Fund, corporations evade over $200 billion in taxes to developing countries, depriving them of critical domestic revenue. Through using tax havens alone, corporations deprive developing countries of $100 billion in annual revenues. Trade mispricing—when subsidiaries or branches of the same corporation artificially “over-price imports or under-price exports” in internal transactions and thus shift taxable profits elsewhere—is another popular method. Oxfam’s “Africa: Rising for the Few” report shows that in 2010, G7 multinational corporations avoided paying $6 billion to African governments through trade mispricing—three times the amount needed to deliver healthcare in West Africa’s Ebola-affected countries. Loopholes in the international tax system enable this evasion. And weak regulation and little leverage over large multinationals makes developing countries particularly susceptible to these practices. Oxfam has joined with several other organizations and charities to form the Independent Commission for the Reform of International Corporate Taxation (ICRICT), and they call for international tax policy reform, demanding that OECD efforts to curb tax dodging extend beyond advanced economies to developing nations. 3. Electoral Transition and Democratic Consolidation This week marked an important moment for democracy advocates. Despite postponing the election, struggling to distribute smart voter cards to eligible voters, and fighting off a violent insurgency that displaced many communities in the northeast, Nigeria bid farewell to President Goodluck Jonathan and swore in the opposition candidate Muhammadu Buhari on Monday. This marked the country’s first alternation of power between civilians of different political parties. Quick on the heels of this momentous occasion, Amnesty International released a damning report exposing human rights abuses committed by the Nigerian security service dating back to 2009. While Buhari’s election signals a positive step toward democratic consolidation and was dubbed by the U.S. assistant secretary of state for the bureau of African affairs as a “beacon for democracy”, the Amnesty report underscores that electoral transition is a necessary but not sufficient indicator of political freedom. For analysis of the Amnesty findings, read John Campbell’s recent blog post. Turkey’s democracy will also be put to the test on Sunday, when voters go to the polls to elect a new parliament. Many expect the election to serve as a referendum on President Tayyip Erdogan’s tenure and his authoritarian policies—including censoring the media, infringing on the judiciary, and cracking down on civil protests. If Erdogan’s party wins—as expected—he will be given license to dilute further Turkey’s democracy.

When President Obama and his fellow Group of Seven (G7) leaders convene this weekend at the Bavarian retreat of Schloss Elmau, they will face two tasks. The most obvious is to formulate common positions on a global agenda so sweeping that it will strain even the lengthiest communiqué. Their more subtle challenge is to signal that their advanced market democracies remain not only an anchor of order in a turbulent world but also a potential engine to drive global governance reform. The reconstitution of the G7 last year coincided with a proliferation of global crises, from the Russian seizure of Crimea and the advent of the Islamic State to the Ebola outbreak in West Africa and heightened tensions in the South and East China Seas. Meanwhile, the rise of new powers and alternative groupings, such as the Group of Twenty (G20) and the BRICS, has threatened the G7 with irrelevance. Given these trends, G7 leaders must recognize that they cannot solve the world’s most pressing challenges alone. However, as a coalition of leading industrialized democracies, the G7 does play an unparalleled role as a global agenda-setter, convener, standard-bearer, and champion of the rules and norms underpinning world order. In this context, the Elmau summit will test the G7’s ability to balance what German Chancellor Angela Merkel has deemed “crisis diplomacy” with the longer-term challenges that will shape the twenty-first century. Four issues in particular bear watching at this summit. Tackling Global Growth: Economic issues will be at the forefront of the G7 summit—just as they were in 1975, when the leaders of what were then six advanced industrial democracies met for their first annual meeting at Chateau Rambouillet in France. But a lot has changed in the past forty years, particularly on the economic front. Today’s G7 nations represent only one-third of global GDP—a sizeable share, to be sure, but dwarfed by the G20’s 85 percent. Indeed, some of the most important engines of global growth are—and for the foreseeable future will be—non-G7 members, such as China, India, and Brazil. This explains, in part, why the G20 is now considered the world’s premier forum for global economic coordination. As if to underscore the G7’s economic vulnerability, the possibility of a Greek exit—or “Grexit”—from the eurozone has dominated news coverage of the upcoming summit, even though it is not on the official agenda. Merkel, for her part, is determined to prevent the Greek debt crisis from overshadowing the event, which she views as a golden opportunity to demonstrate the G7’s continued relevance and make headway on equally pressing challenges like poverty and global warming. Supporting Sustainable Development and Combating Climate Change: The Elmau summit offers a chance to build momentum behind three major UN gatherings during the second half of 2015: the Financing for Development summit in Addis Ababa in July, the launch of the Sustainable Development Goals in New York in September, and the twenty-first Conference of Parties to the UN Framework Convention on Climate Change (UNFCCC) in Paris in November and December. Despite the rise of new donors like China, G7 nations remain the largest providers of official development assistance (ODA), accounting for 70 percent of total net ODA in 2013. Since 2011, the G7’s major development initiative has been the so-called Deauville Partnership, intended to assist liberal political transitions in the Middle East and North Africa in the wake of the so-called “Arab Spring.” The G7 nations will also showcase new climate change initiatives, with an eye toward the Paris conference. On May 7, the German government announced the G7 initiative on Climate Risk insurance, which aims to increase the resilience of developing countries against climate-induced (and other natural) disasters. Another promising development was the agreement [PDF] by G7 energy ministers on May 12 that all the G7 countries’ initiatives should support a global climate treaty. Meanwhile, a coalition of 120 business leaders has sent an open letter [PDF] to the G7 finance ministers, urging them to support a long-term global emissions reduction goal in the Paris agreement and submit short- to medium-term national emissions pledges and country-level action plans. Strengthening Maritime Security: One of the novel additions to this year’s agenda (if incongruous in the alpine setting) will be maritime security. In April, G7 foreign ministers adopted a Declaration on Maritime Security outlining their concerns regarding the territorial disputes in the South and East China Seas; the problem of illegal, unreported, and unregulated fishing; piracy and human trafficking at sea; and the conservation of marine biodiversity. Although the declaration does not explicitly refer to China by name, there is no doubt about its primary target. Reportedly, Japan had appealed to its partners in the G7 to take a stronger stance on China’s maritime assertiveness—and the document drew the ire of some in the Chinese media for its condemnation of “unilateral actions, such as large scale land reclamation,” and its opposition to “any attempt to assert territorial or maritime claims through the use of intimidation, coercion or force.” Like last year’s decision to eject the Russia, this development suggests that the G7 could be returning to its Cold War roots as a vehicle to defend the Western liberal order against potential geopolitical adversaries. Bolstering Global Health: Finally, Merkel has emerged as an eloquent advocate for reforming the World Health Organization (WHO), most recently delivering a powerful speech at the opening of the World Health Assembly last month. At Schloss Elmau, the G7 will pick up the three issues that she raised in that address: distilling lessons from the Ebola epidemic; combating poverty-related neglected tropical diseases; and tackling increased antibiotic resistance. Merkel has affirmed that the world needs a strong WHO, but she also understands that other actors—e.g., the private sector, public-private partnerships, and NGOs—play an increasingly vital role in protecting global health security. Given the financial resources and technical expertise at its disposal, the G7 is uniquely positioned to mobilize and maintain global support for outbreak preparedness and scientific research and development. Inherent in Merkel’s summit agenda is a paradox: the G7 is taking up a growing number of challenges that are global in scale, and yet it remains an exclusive club of advanced democracies. From economics and health to maritime security and climate change, all of the issues to be discussed at the summit are beyond the capacity of the G7 to resolve. What the G7 does provide is a platform to rally support for more comprehensive global efforts. Refreshingly, the chancellor herself recognizes this constraint:   The G7 cannot meet these challenges alone; we will need many other partners. Nevertheless, I am convinced that the G7 can be, indeed must be, the driving force for a world worth living in, in the long term. … That is the value-added that can be expected from G7 summits. And that is the standard against which we should measure our actions.   The G7 retains enormous symbolic value as a likeminded coalition of market democracies dedicated to the international rule of law. But to remain relevant, it must leverage its diplomatic clout and unmatched resources to drive reform in other global bodies. And indeed, this is the summit’s greatest opportunity for breakthrough. For the G7 cannot afford to become a gated retirement community in a chaotic world.

This post marks the launch of a new feature on the Development Channel, "This Week in Markets and Democracy." Each Friday, CFR’s Civil Society, Markets, and Democracy Program, will highlight the week’s noteworthy events and articles. 1. Rampant Corruption at FIFA On Wednesday, Swiss police raided a Zurich hotel and arrested several top officials of the global soccer governing body FIFA with plans to extradite them to the United States. The U.S. Department of Justice is charging them, along with former FIFA officials and top sports marketing executives, with corruption, money laundering, conspiracy, and racketeering. “These individuals and organizations engaged in bribery to decide who would televise games, where the games would be held, and who would run the organization overseeing organized soccer worldwide,” said U.S. Attorney General Loretta E. Lynch. The Department of Justice estimates that officials received$150 million in bribes and kickbacks since the early 1990s. FIFA has long been mired in inconclusive corruption scandals. Now the United States and the Swiss government—which is investigating bribery allegations in Russia and Qatar’s bids for the 2018 and 2022 World Cups—are unveiling the rampant, systematic corruption plaguing the international organization. The arrests have received overwhelming support from the global soccer fandom. Even senior soccer officials have expressed support. In a statement, the European soccer federation (UEFA) said, “These events show, once again, that corruption is deeply rooted in FIFA’s culture. There is a need for the whole of FIFA to be ‘rebooted’ and for a real reform to be carried out.” These investigations not only offer an opportunity to clean up soccer’s international governing body, but they are also a boon for anti-corruption organizations and activists—illustrating how domestic laws and courts can help change even the most opaque and powerful international organizations. 2. FAO 2015 Report shows chronic hunger reaches record lows This week, the Food and Agriculture Organization of the United Nations (FAO) released its annual hunger report, which monitors global food deprivation and security. According to FAO estimates, chronic hunger worldwide fell below 800 million for the first time since FAO began tracking it. The FAO also reports that the majority of the 129 monitored countries achieved the 2015 Millennium Development Goal of halving domestic undernourishment. Developing regions, however, missed the MDG target, though narrowly (by less than one percentage point). FAO Director General José Graziano da Silva optimistically stated, “The near-achievement of the MDG hunger targets shows us that we can indeed eliminate the scourge of hunger in our lifetime. We must be the Zero Hunger generation. That goal should be mainstreamed into all policy interventions and at the heart of the new sustainable development agenda to be established this year." These gains are particularly impressive given they occurred in the face of economic recessions, volatile commodity and food prices, extreme weather and natural disasters, and political instability—all of which aggravate food insecurity. Yet, progress has been uneven across world regions. Over the past few decades, East and Southeast Asia as well as Latin America and the Caribbean significantly reduced hunger within their borders. Sub-Saharan Africa and South Asia, on the other hand, lag behind, and the two regions are now home to over half of the chronically hungry. Breaking with the global trend, the undernourished population in Sub-Saharan Africa actually increased by 25 percent since 1990-92. For these laggards, the FAO calls for inclusive economic growth, agricultural investments, and expanded social protection as the ways to reduce hunger. 3. It’s possible to lift people out of poverty Poverty eradication is the first goal of the sustainable development framework, the proposed successor of the Millennium Development Goals. World leaders have committed to ending extreme poverty by 2030. The problem donors, multilaterals, nonprofits, and private sector partners confront is that poverty is a complex, multidimensional issue—which encompasses lack of access to health, education, financial services, capital, and markets. Programs often suffer from shoddy implementation, prove difficult to replicate across countries, achieve results in one aspect of individuals’ lives but not the others, or fail to deliver benefits that last. Against this backdrop, a new study published in the May 2015 issue of Science offers if not a panacea, certainly hope. Authored by several development economists, including MIT’s Abhijit Banerjee and Esther Duflo and Yale’s Dean Karlan, the paper presents findings from six randomized control trials (RCTs) implemented in Ethiopia, Ghana, Honduras, India, Pakistan, and Peru. In five of the six countries, it finds that multipronged poverty reduction programs—which they call graduation programs—can deliver sustainable benefits. By providing a productive asset, training, access to savings, health care, regular home visits, and food or cash for a few months to a year, they find that household income and consumption not only increased during the intervention, but continued after. This suggests that a concentrated approach can raise people out of poverty in the long term, good news indeed.

It has become axiomatic in international development that increasing economic opportunities for women contributes to economic growth. Organizations from the World Bank to the Organisation for Economic Cooperation and Development (OECD) have concluded that women’s participation in the economy is linked to poverty reduction and gross domestic product (GDP) growth. Today, the question is not whether women’s economic participation matters—rather, it is how to promote this goal most effectively. The Millennium Challenge Corporation (MCC), a U.S. foreign aid organization, has been at the forefront of answering this question. Last week, Dana Hyde, the chief executive officer of MCC, spoke at the Council on Foreign Relations about MCC’s innovative approach to reducing poverty and promoting growth around the world—including through the advancement of gender equality. MCC is a young agency, celebrating its tenth anniversary just this year, and it governs a relatively small share of the U.S. government’s foreign assistance budget. Nevertheless, MCC has had an outsized impact, and has been heralded internationally for its commitment to results-based, data-driven foreign assistance. MCC employs a competitive selection process, partnering only with countries that meet a set of rigorous policy indicators conducive to promoting economic growth. Once countries are selected, the organization works with in-country actors to identify priorities and facilitate local management, thereby fostering both country ownership and sustainability. It also insists upon comprehensive and transparent monitoring and evaluation as programs are implemented. Critical to MCC’s economic growth strategy is its commitment to advancing gender equality. In 2006, MCC enacted a robust Gender Policy that requires consideration of gender inequalities in development, implementation, and evaluation of programs. Five years later, MCC expanded its guidance by introducing Gender Integration Guidelines, which provide specific operational instructions on how to integrate gender into development work, including through the recruitment of gender specialists in partner countries and the creation of country-specific gender integration plans. To build on this progress, in 2012, MCC revised its country selection criteria to assess the degree to which potential country partners provide women the same legal capacity to work as men. This indicator assesses whether married and unmarried women can engage in ten different economic activities, including holding a job, registering a business, signing a contract, opening a bank account, and serving as a head of household. By adopting this indictor, MCC has not only changed its own practice—it has also sent a powerful message that ensuring an equal playing field for women and men in the economy is both a precondition of economic growth and a factor in whether a country will be entitled to partner with the U.S. government. The addition of a gender equality indicator as a condition of MCC partnership is already paying dividends. The government of Cote d’Ivoire, for example, approached MCC to find a way to improve its laws on gender equality in order to bolster its competitiveness for U.S. assistance. Soon after, the country enacted a new law to give women the same rights as men to determine where they live, work, and travel. Such policy changes are sorely needed: according to the World Bank’s Women, Business and the Law report, 128 out of 143 countries today have at least one legal difference between men and women that restricts women’s economic opportunities. In 54 countries, women face five or more limitations. Though MCC’s focus on legal reform to promote women’s economic participation is promising, there are a range of other gender inequalities that undermine growth and could be considered as well. One example is gender-based violence, which inhibits women’s economic participation and exacts significant costs: a World Bank report estimated the cost of this violence to range between 1.2 to 3.7 percent of GDP, depending on the country. Or consider the issue of child marriage, which is negatively correlated with girls’ education and economic potential: surely this factor should be considered as MCC develops a compact with Niger, which has the highest overall child marriage prevalence rate in the world. MCC’s emphasis on fair and equal legal capacity as a condition of economic growth is significant both as a matter of policy and practice. To leverage funding even more effectively, MCC should consider incorporating other indicators of gender equality, in addition to legal equality in the economic sector, when evaluating whether potential partner countries have created environments conducive to poverty reduction and economic growth.

It has become axiomatic in international development that increasing economic opportunities for women contributes to economic growth. Organizations from the World Bank to the Organisation for Economic Cooperation and Development (OECD) have concluded that women’s participation in the economy is linked to poverty reduction and gross domestic product (GDP) growth. Today, the question is not whether women’s economic participation matters—rather, it is how to promote this goal most effectively. The Millennium Challenge Corporation (MCC), a U.S. foreign aid organization, has been at the forefront of answering this question. Last week, Dana Hyde, the chief executive officer of MCC, spoke at the Council on Foreign Relations about MCC’s innovative approach to reducing poverty and promoting growth around the world—including through the advancement of gender equality. MCC is a young agency, celebrating its tenth anniversary just this year, and it governs a relatively small share of the U.S. government’s foreign assistance budget. Nevertheless, MCC has had an outsized impact, and has been heralded internationally for its commitment to results-based, data-driven foreign assistance. MCC employs a competitive selection process, partnering only with countries that meet a set of rigorous policy indicators conducive to promoting economic growth. Once countries are selected, the organization works with in-country actors to identify priorities and facilitate local management, thereby fostering both country ownership and sustainability. It also insists upon comprehensive and transparent monitoring and evaluation as programs are implemented. Critical to MCC’s economic growth strategy is its commitment to advancing gender equality. In 2006, MCC enacted a robust Gender Policy that requires consideration of gender inequalities in development, implementation, and evaluation of programs. Five years later, MCC expanded its guidance by introducing Gender Integration Guidelines, which provide specific operational instructions on how to integrate gender into development work, including through the recruitment of gender specialists in partner countries and the creation of country-specific gender integration plans. To build on this progress, in 2012, MCC revised its country selection criteria to assess the degree to which potential country partners provide women the same legal capacity to work as men. This indicator assesses whether married and unmarried women can engage in ten different economic activities, including holding a job, registering a business, signing a contract, opening a bank account, and serving as a head of household. By adopting this indictor, MCC has not only changed its own practice—it has also sent a powerful message that ensuring an equal playing field for women and men in the economy is both a precondition of economic growth and a factor in whether a country will be entitled to partner with the U.S. government. The addition of a gender equality indicator as a condition of MCC partnership is already paying dividends. The government of Cote d’Ivoire, for example, approached MCC to find a way to improve its laws on gender equality in order to bolster its competitiveness for U.S. assistance. Soon after, the country enacted a new law to give women the same rights as men to determine where they live, work, and travel. Such policy changes are sorely needed: according to the World Bank’s Women, Business and the Law report, 128 out of 143 countries today have at least one legal difference between men and women that restricts women’s economic opportunities. In 54 countries, women face five or more limitations. Though MCC’s focus on legal reform to promote women’s economic participation is promising, there are a range of other gender inequalities that undermine growth and could be considered as well. One example is gender-based violence, which inhibits women’s economic participation and exacts significant costs: a World Bank report estimated the cost of this violence to range between 1.2 to 3.7 percent of GDP, depending on the country. Or consider the issue of child marriage, which is negatively correlated with girls’ education and economic potential: surely this factor should be considered as MCC develops a compact with Niger, which has the highest overall child marriage prevalence rate in the world. MCC’s emphasis on fair and equal legal capacity as a condition of economic growth is significant both as a matter of policy and practice. To leverage funding even more effectively, MCC should consider incorporating other indicators of gender equality, in addition to legal equality in the economic sector, when evaluating whether potential partner countries have created environments conducive to poverty reduction and economic growth.

Emerging Voices features contributions from scholars and practitioners, highlighting new research, thinking, and approaches to development challenges. This article is by Elizabeth Littlefield, president and chief executive officer of the Overseas Private Investment Corporation, the U.S. government’s development finance institution. This month marks the 70th anniversary of Victory in Europe Day—when Nazi Germany surrendered to the allied powers and World War II ended in Europe. This occasion is an important opportunity to reflect on how the postwar reconstruction plan shapes our current model of economic engagement with the developing world and to consider expanding the role of the private sector in these efforts. The postwar consensus came together at Bretton Woods. To rehabilitate a ravaged Europe, representatives of the allied powers agreed on a few basic lessons from the war: (1) advanced nations, especially the United States, need to engage with the world; (2) economic instability breeds conflict; and (3) military and economic preparedness of individual nations alone can’t provide stability. These beliefs have informed U.S. post-war policies and led to the creation of the International Monetary Fund (IMF) and World Bank. For decades after, multilateral institutions and national governments led the investment in the developing world. In the early 1970s, official development assistance dwarfed private capital flows into emerging nations. The Bretton Woods consensus continues to shape the approach to economic development. Today, developing countries receive IMF and Bank loans as well as aid from donor governments. But development assistance is no longer the primary source of international capital. For every $1 in official flows, $7 in private investments flow into the developing world. (Official flows are $134 billion, while private flows are $778 billion). Yet, the need remains, and the private sector is well positioned to deliver where aid efforts have fallen short—in meeting immediate demands, especially creating jobs, building infrastructure, and stimulating the economy. The Overseas Private Investment Corporation (OPIC) was established in 1971 as a mechanism to help companies enter emerging markets. The U.S. government spun this development finance institution (DFI) out of the U.S. Agency for International Development. OPIC provides financing and political risk insurance to private investors seeking to work in emerging markets. By leveraging U.S. private sector capital and capacity to address critical needs in development countries, OPIC advances U.S. foreign policy and national security objectives. Today, OPIC’s global portfolio totals $18 billion in financing and insurance, supporting development projects in over 100 countries. Yet, OPIC’s capacity to support these investments doesn’t meet the scale needed today. Nearly $800 billion in global foreign direct investment (FDI) goes to developing economies, but the world’s least-developed countries receive less than 4 percent of global FDI flows. Aid will not satisfy the unmet needs of the world’s least developed regions. Currently, less than 1 percent of the U.S. budget is allocated to foreign assistance, and it is difficult to imagine this figure will drastically increase. Rather, increased private sector investment is the answer. Numerous U.S. companies are ready to invest their capital in emerging markets, but they need support to meet the business challenges and risk common to such environments. OPIC has already played an important role, providing loans and guarantees to mobilize investments and insurance to protect against unforeseen events But, the United States lags behind in economic engagement in developing countries. To expand U.S. private sector engagement, it will be necessary to redouble OPIC’s efforts. It is time for the United States to lead once more in the effort to spread peace and prosperity to the developing world—as we did post-World War II.

Emerging Voices features contributions from scholars and practitioners highlighting new research, thinking, and approaches to development challenges. This article is by Deirdre White, chief executive officer of PYXERA Global. In January, the United Nations put forward the Open Working Group proposal for the Sustainable Development Goals (SDGs): a set of seventeen goals, along with 169 associated indicators. This proposal will be voted on by the United Nations General Assembly this September. While it has many merits, it doesn’t, in the end, help practitioners make the most progress in bettering people’s lives. First, the SDG proposal is overwhelming. Not only are there too many goals, but each one is also quite expansive. For example, the first goal to “end poverty in all its forms everywhere” is both broad and ambiguous. Many of the other SDGs such as “ensure healthy lives and promote well-being for all at all ages,” and “provide access to justice for all… at all levels” are similarly far-reaching. Because of their breadth, these goals will be difficult for development organizations to operationalize. For example, the first SDG—“end poverty”—does not translate easily into a specific set of interventions on the ground. Additionally, the SDGs approach human development in a piece-meal fashion, addressing poverty, food security, education, health, employment, and sanitation as stand-alone challenges. This isolationist approach is detrimental because it discounts the systemic nature of development challenges and thus makes the task of tackling them larger. Effective and efficient sustainable development requires coordinated rather than independent campaigns on all fronts. While it may be too late to reconceptualize the SDGs, framing them differently would help development organizations overcome their shortcomings. We at PYXERA Global have examined the seventeen SDGs and distilled them, as shown in the below graphic, into four lead focus areas: health, human rights, natural/human environment, and economic opportunity/employment. Click to enlarge: PYXERA Global four lead focus areas. Reframing the SDGs makes them more accessible and digestible for practitioners. By consolidating the overwhelming volume of goals, PYXERA’s framework enables organizations to concentrate on a specific focus area that they are well-suited to address. Additionally, the framework allows practitioners to recognize areas of overlap among different development objectives and to design programs that address their systemic nature. By taking into consideration the interrelatedness of the goals, practitioners will be able to address societal challenges more quickly and sustainably. For example, when addressing community health, one must consider not just health alone, but also issues of water and sanitation (goal six), food security (goal two), and the promotion of healthy lives at all ages (goal three) to ensure long-lasting change. Yet, it’s not enough to create an actionable development framework. It is critical that the United Nations and proponents of the SDGs also emphasize a tri-sector approach. While goal seventeen encourages global partnerships, a cross-sector approach explicitly brings together different sectors. Public, private, and social sectors all contribute unique strengths and tools. Each has a role to play in creating the systemic change needed to make sustainable and real progress on human development. Social sector organizations build legitimacy and trusted relationships at a local level. They also ensure that efforts deliver meaningful impact to the most vulnerable communities. Government, on the other hand, creates the enabling environment necessary for social change to be effective, providing infrastructure, educational facilities, and social services. And whereas the public sector rarely has a tolerance for failure, the private sector experiments with solutions to weed out inefficiencies, provide financial resources, and drive critical technological innovations. In my own work at PYXERA Global, I have seen how tri-sector partnerships align the strengths of different sectors to achieve better results. The Joint Initiative for Village Advancement (JIVA), for example, is a community development program aimed at enhancing livelihoods in three rural villages in Rajasthan, India. The program is a partnership between the residents of the three villages, the John Deere Foundation, PYXERA Global, and the community-based NGO Jatan Sansthan. Each partner brings complementary competencies and specific expertise in agriculture, community development, and gender. These contributions have translated into integrated interventions in agriculture, income security, education, and infrastructure. After two and a half years, JIVA has contributed much to these three villages: over half of households adopted at least one new agriculture practice, leading 50 percent of farmers to substantially increase their profits. JIVA’s after-school program enrolled 100 percent of primary school drop-outs across all of the villages, helping 84 percent of them reintegrate into formal schooling. At the same time, JIVA’s educational intervention helped students across the villages improve test scores. While the SDGs articulate our highest hopes for human progress, our efforts must be grounded in an integrated, tri-sector approach to truly ensure realistic, sustainable progress against today’s development challenges.

Emerging Voices features contributions from scholars and practitioners highlighting new research, thinking, and approaches to development challenges. This article is by Leora Klapper, lead economist for the World Bank’s development research group. On a recent visit to Dhaka, Bangladesh, I toured garment factories and spoke with factory workers about the financial challenges they face. In my conversations with female employees, I learned that although they own bank accounts, many don’t use them for an important transaction: paying their children’s school fees. Instead, these women pay in cash, costing them time and money. They take two long, expensive bus rides across town to the school. They take the day off from work, meaning a day without pay. Even the women’s employer isn’t happy with the situation; he’d rather they were able to work. Owning a bank account is a vital first step toward financial inclusion—a step these women have taken. But the real benefits come from frequent account use, meaning they have not reaped the full reward of account ownership. In this, these factory workers are not alone. Across Bangladesh, 10 million adults with bank accounts pay their children’s school fees in cash. And in developing economies globally, more than 500 million adults with an account do the same. The 2014 Global Findex database, an update of the world’s only comprehensive gauge of global progress on financial inclusion, tracks these figures. The World Bank—with funding from the Bill & Melinda Gates Foundation and in partnership with Gallup Inc.—launched the Global Findex in 2011. Like the first edition, the data for the 2014 update was collected from interviews with nationally representative and randomly selected adults aged fifteen and older. Nearly 148,000 people were surveyed in 143 economies during the 2014 calendar year. The 2014 data show that in East Asia and the Pacific, Latin America and the Caribbean, and the Middle East more than 60 percent of adults with an account pay utility bills or school fees in cash. In South Asia, 42 percent of adults with an account have left it unused for a year or more. In developing economies globally, almost 90 percent of adults who pay utility bills and 85 percent of those who make payments for school fees do so in cash. Yet the same cannot be said for high-income, OECD economies: among adults in those countries who pay utility bills, the majority makes such payments digitally, either directly from an account at a financial institution or via mobile phone. Why the discrepancy? Perhaps individuals in developing economies are not aware of an existing electronic payment option. Maybe those schools do not have electronic payment systems in place. If so, it is up to banks, mobile money service providers, and others to make the technology available to end users, like schools and utilities. Yet there is more that governments and the private sector can do to boost account use among adults worldwide. For example, both the private and public sectors can pay wages and other transfers, such as unemployment benefits, digitally instead of in cash—which could add over 400 million new account holders. Governments and the private sector can also encourage account holders to use digital services, such as remittance payments. Currently, 355 million adults with an account send or receive domestic remittances in cash or through a money transfer operator. But digital transfers could be even easier and cheaper for workers and their families. Governments and financial institutions can work together to support the transition to digital payments—governments through regulations permitting correspondent bank agents, and financial institutions by developing networks of mom and pop shops that make sending and receiving digital payments more convenient. For example, in China, over 800,000 small merchants disburse government payments made to accounts. However, digitizing payments and shifting cash payments into accounts is not without challenges. For account use to increase, governments and the private sector must make upfront investments in payments infrastructure and guarantee a reliable and consistent digital payment experience. New account owners need to be educated on the basic interactions involved in a digital payment system – using and remembering PINs, understanding how to deposit and withdraw money, and knowing what to do when something goes wrong. By presenting data on how adults globally save, borrow, make payments, and manage risk, the Global Findex quantifies the gaps in financial inclusion—and the market opportunities—and  reveals how governments and the private sector can help underserved populations benefit from financial services.

Emerging Voices features contributions from scholars and practitioners highlighting new research, thinking, and approaches to development challenges. This article is by Leora Klapper, lead economist for the World Bank’s development research group. On a recent visit to Dhaka, Bangladesh, I toured garment factories and spoke with factory workers about the financial challenges they face. In my conversations with female employees, I learned that although they own bank accounts, many don’t use them for an important transaction: paying their children’s school fees. Instead, these women pay in cash, costing them time and money. They take two long, expensive bus rides across town to the school. They take the day off from work, meaning a day without pay. Even the women’s employer isn’t happy with the situation; he’d rather they were able to work. Owning a bank account is a vital first step toward financial inclusion—a step these women have taken. But the real benefits come from frequent account use, meaning they have not reaped the full reward of account ownership. In this, these factory workers are not alone. Across Bangladesh, 10 million adults with bank accounts pay their children’s school fees in cash. And in developing economies globally, more than 500 million adults with an account do the same. The 2014 Global Findex database, an update of the world’s only comprehensive gauge of global progress on financial inclusion, tracks these figures. The World Bank—with funding from the Bill & Melinda Gates Foundation and in partnership with Gallup Inc.—launched the Global Findex in 2011. Like the first edition, the data for the 2014 update was collected from interviews with nationally representative and randomly selected adults aged fifteen and older. Nearly 148,000 people were surveyed in 143 economies during the 2014 calendar year. The 2014 data show that in East Asia and the Pacific, Latin America and the Caribbean, and the Middle East more than 60 percent of adults with an account pay utility bills or school fees in cash. In South Asia, 42 percent of adults with an account have left it unused for a year or more. In developing economies globally, almost 90 percent of adults who pay utility bills and 85 percent of those who make payments for school fees do so in cash. Yet the same cannot be said for high-income, OECD economies: among adults in those countries who pay utility bills, the majority makes such payments digitally, either directly from an account at a financial institution or via mobile phone. Why the discrepancy? Perhaps individuals in developing economies are not aware of an existing electronic payment option. Maybe those schools do not have electronic payment systems in place. If so, it is up to banks, mobile money service providers, and others to make the technology available to end users, like schools and utilities. Yet there is more that governments and the private sector can do to boost account use among adults worldwide. For example, both the private and public sectors can pay wages and other transfers, such as unemployment benefits, digitally instead of in cash—which could add over 400 million new account holders. Governments and the private sector can also encourage account holders to use digital services, such as remittance payments. Currently, 355 million adults with an account send or receive domestic remittances in cash or through a money transfer operator. But digital transfers could be even easier and cheaper for workers and their families. Governments and financial institutions can work together to support the transition to digital payments—governments through regulations permitting correspondent bank agents, and financial institutions by developing networks of mom and pop shops that make sending and receiving digital payments more convenient. For example, in China, over 800,000 small merchants disburse government payments made to accounts. However, digitizing payments and shifting cash payments into accounts is not without challenges. For account use to increase, governments and the private sector must make upfront investments in payments infrastructure and guarantee a reliable and consistent digital payment experience. New account owners need to be educated on the basic interactions involved in a digital payment system – using and remembering PINs, understanding how to deposit and withdraw money, and knowing what to do when something goes wrong. By presenting data on how adults globally save, borrow, make payments, and manage risk, the Global Findex quantifies the gaps in financial inclusion—and the market opportunities—and  reveals how governments and the private sector can help underserved populations benefit from financial services.

Emerging Voices features contributions from scholars and practitioners highlighting new research, thinking, and approaches to development challenges. This article is by Dr. Khalid Koser, executive director of the Global Community Engagement and Resilience Fund (GCERF) and a nonresident senior fellow in foreign policy at the Brookings Institution. In his rallying cry for action to counter violent extremism (CVE) at the World Economic Forum in Davos a few weeks ago, U.S. Secretary of State John Kerry concluded, “The bottom line is we need everyone involved—governments, foundations, philanthropists, NGOs, corporations, faith leaders, the private sector.” Of these groups, it is the last one—the private sector—that holds the most promise, but is also the most challenging to engage; the private sector has typically been leery of participating directly in initiatives related to security and especially counterterrorism. For example, the private sector tends to abstain from engaging in local political or social issues, so when threats of violence materialize or a security situation disintegrates,  the chief concern for corporations becomes the vulnerability of their assets on the ground. Over the last few months, I have worked to bring the private sector in to support the Global Community Engagement and Resilience Fund, the first global effort to support community-level initiatives aimed at strengthening resilience against violent extremist agendas. I have learned these five lessons: 1. Make the Business Case Countering violent extremism goes beyond the remit of corporate social responsibility for most companies. Instead, encouraging private sector involvement can be accomplished by making a more direct business case. This is perhaps easiest for those sectors already invested in parts of the world vulnerable to extremism, for example the extractive industries. Yet a business case can also be made for companies seeking to tap into new markets. Extremism poisons talent pools, disrupts supply chains, blocks the movement of goods and people, thwarts small and medium sized enterprises, and lowers the return on investment in entire regions. An investment in countering violent extremism is an investment in future growth in those regions. 2. Focus on Outcomes While the Global Community Engagement and Resilience Fund uses development tools to achieve security outcomes, a comprehensive approach to countering violent extremism includes military, security, and intelligence measures as well. Other than for those companies working directly in these fields, this makes the private sector nervous. Rather than emphasizing those approaches to CVE, pitches to private sector actors should highlight the outcomes of these programs: stabilizing economies and unleashing the potential of communities. 3. Start Local In my experience, it is both easier and more fruitful to engage local private sector actors in affected countries. Local firms ultimately have most to lose from the growth and spread of violent extremism, and though their room to maneuver through political constraints may be limited, they can be valuable assets. Yet this does not refer to small businesses alone. The national branches of multinational companies are likely to be more knowledgeable and more invested in countering violent extremism than their global headquarters, to whom extremism may seem like a smaller or more distant problem. 4. Seek Core Competencies, Not Capital While companies are unlikely to invest equity in CVE projects, they can certainly contribute skills and competencies that complement those of government and civil society. These competencies include operational, technical, and financial expertise; access to business and political leaders; and convening power in affected regions. 5. Widen the Focus Although the ISIS conflict in Syria and Iraq is undoubtedly the current epicenter of violent extremism, such extremism manifests itself in myriad ways—and not just in association with religion. Quick wins are required for the private sector to engage, and these are to be had in sub-Saharan Africa and Southeast Asia, for example. It is certainly in the interest of the global effort to counter violent extremism to engage the private sector in these programs. In order for them to succeed, it should be made clear to the private sector that it is in their interest, too.

Coauthored with Daniel Chardell, research associate in the International Institutions and Global Governance program. This weekend, leaders of the Group of Twenty (G20) states gather in Brisbane, Australia, for their annual summit. To maintain the G20’s credibility, President Obama and his counterparts need to demonstrate that it is capable of taking concrete steps to restore global economic growth. Designated the world’s “premier forum” for international economic cooperation in the wake of the 2008 financial crisis, the G20 is widely credited with staving off a global depression. No mean feat, by any estimation. Its more recent performance has been disappointing. Many commentators, noting the still-tepid global recovery, the G20’s failure to implement past commitments, and its members’ diverging interests, question its credibility and capacity to effect real change. The forum’s best days, they suggest, are behind it. That judgment is premature. The G20 remains a mainstay of global economic coordination, for reasons both symbolic and practical. The world is experiencing an unprecedented shift in global economic power. At such a fluid (and potentially volatile) moment, the world urgently needs a high-level steering group that convenes leaders of the most important advanced and emerging countries. Unlike the more exclusive and homogeneous Group of Seven (G7), the G20’s large and diverse composition gives its decisions more heft and greater legitimacy. It provides a potentially flexible framework in which to hammer out consensus on chronic challenges—as well as respond to urgent crises. Aware that many are treating the Brisbane summit as a test of the G20’s relevance, the Australian government—which holds the G20’s rotating chair—has crafted a narrow agenda focused on restoring global economic growth. Earlier this year, G20 finance ministers and central bank governors agreed to develop policies to lift global GDP 2 percent above the business-as-usual scenario over the next five years. This weekend, G20 leaders will present their national strategies to realize this target, as part of what is being called the Brisbane Action Plan. Reaching this new growth target will require new member state commitments in several policy areas–all of which are on the Brisbane agenda. These include redoubling investment in global infrastructure, combating corporate tax evasion, strengthening financial regulation, and implementing long-deferred governance reforms in international financial institutions. Investing in infrastructure: In September, G20 finance ministers and central bank governors agreed to launch the Global Infrastructure Initiative (GII) as a knowledge-sharing platform that seeks to match potential investors with projects. The GII will complement the Global Infrastructure Facility, established in October by the World Bank Group to facilitate public-private partnerships to finance infrastructure in the developing world. In Brisbane, G20 leaders should announce demonstration projects to illustrate the concrete benefits of these matchmaking initiatives. Curtailing tax evasion: Effective, transparent, and fair tax systems are vital to inclusive economic growth. In Brisbane, leaders will announce new steps to combat base erosion and profit-shifting (BEPS), which occurs when multinational corporations funnel profits to low- or no-tax jurisdictions to avoid taxation where business activity actually occurs. Last year in St. Petersburg, Russia, G20 leaders endorsed the OECD’s Action Plan on BEPS, intended to lead to a single set of international rules on tax evasion by the end of 2015. The battle against tax evasion was given a boost last week by the leak of documents showing that more than three hundred major multinationals channeled their profits to Luxembourg, allegedly saving them billions in taxes. President Obama can leverage the international outrage at these revelations to press for prompt adoption of the OECD Action Plan by G20 members. Ending the era of “too big to fail”: This week, the Financial Stability Board (FSB) released new rules that aim to end taxpayer bailouts of banks deemed “too big to fail.” The FSB will present the rules at Brisbane this weekend. President Obama and other G20 leaders are expected to endorse the proposal, a critical step to bolster public confidence in the G20. Trickier for President Obama will be pressing for full implementation of the governance reforms of the International Monetary Fund (IMF). In 2010, the United States engineered a historic agreement  to double the IMF’s quota—essentially, its lending capacity—and shift voting weight and representation (largely from Europe) to emerging economies. Unfortunately, the U.S. Congress has failed to approve these reforms, even though they will neither increase U.S. financial commitments nor endanger Washington’s veto over major IMF decisions. Congressional Republicans, the source of the opposition, are unlikely to budge, especially given their triumph in last week’s midterms. To circumvent the gridlock in Washington, the BRICS countries (Brazil, Russia, India, China, and South Africa) are expected to propose “alternative solutions” in Brisbane, such as breaking up the 2010 reform package into smaller parts. Despite this potential work-around, Congress’s failure to ratify IMF reform carries tangible financial and reputational costs for the United States. Since World War II, the Fund has been the principal multilateral forum to promote global financial stability, just as the World Bank has served as the world’s main development agency. Frustrated with U.S. intransigence, the BRICS are starting to set up alternative institutions to rival the IMF and World Bank: the Contingency Reserve Arrangement and the New Development Bank, respectively. Though not yet operational, these new institutions could presage a fragmented global economic order. For all the talk on Capitol Hill about President Obama’s indecisive leadership, Congress’s own inaction on IMF reform should be considered a national embarrassment. Notably absent from the Brisbane summit agenda, finally, is climate change. Despite pressure from the United States and Europe, Australia resisted including it as an item for discussion, and the final summit communique is expected to devote a mere paragraph to the issue. To be sure, climate change is politically sensitive for Australian Prime Minister Tony Abbott, who in July repealed the country’s carbon tax, earning the dubious distinction of the “first developed nation” to do so. Many experts, moreover, argue that climate change has no place on the agenda, since it would dilute the G20’s purely economic mandate. Alas, the world is not so neatly compartmentalized. As recent reports from the Intergovernmental Panel on Climate change (IPCC) and a coalition of prominent business executives underline, the fate of the global economy and the global climate are inextricably linked. Extreme weather, rising sea levels, the health consequences of air pollution, and other consequences of climate change pose astronomical risks to the economy. In the long-run, the cost of mitigating climate change is negligible compared to the cost of inaction. In short, a G20 “growth agenda” that ignores climate change is nothing of the sort. And if climate change demands immediate and concerted action among developed and developing countries alike (as this week’s ambitious U.S.-China climate change pact shows it does), there is no more fitting venue than the G20, which already includes all seventeen members of the Major Economies Forum (MEF) of major emitting countries. Merging the MEF into the G20 would simply elevate the former to the leaders’ level. The scope of the G20’s mandate has been the topic of a running debate since it was elevated to a leaders’ level forum six years ago. The dilemma is that the G20 may not survive the addition of new issue areas—but can it afford to ignore the most urgent global challenges? One way to square the circle, as this blog has noted, is to create a parallel foreign ministers track, alongside that headed by finance ministers and central bank governors, to address a broader suite of global issues not adequately addressed in the narrow G7, the two-tiered UN Security Council, and the unwieldy UN General Assembly. Last month, IMF Managing Director Christine Lagarde called for a “new multilateralism” based on “a renewed commitment to the global public good.” She may be overly sanguine about the willingness of independent nations to subordinate their interests to cosmopolitan purposes. But the world does need a new multilateralism, where sovereign states can bargain and horse-trade to realize broadly shared common ends. The G20 must be at the heart of this effort—in Brisbane and beyond.