Transitioning from Foreign Aid: Is the Next Cohort of Graduating Countries Ready?

15 Pages Posted: 17 Jul 2019

See all articles by Gavin Yamey

Gavin Yamey

Duke Global Health Institute

Diana Gonzalez-Garcia

Pharos Global Health Advisors

Ipchita Bharali

Duke University - Duke Global Health Institute

Kelly Flanagan

Pharos Global Health Advisors Ltd

Robert Hecht

Pharos Global Health Advisors Ltd

Date Written: July 16, 2019

Abstract

In the coming years, over a dozen middle-income countries (MICs) are likely to transition from multilateral concessional assistance, including assistance from the International Development Association (IDA) and Gavi, the Vaccine Alliance (Gavi). The cohort of upcoming graduates, which includes Nigeria and Pakistan, may find the transition more challenging when compared with the experiences of previous countries that have already graduated. Many upcoming graduates, for example, still have high rates of child and maternal mortality and large proportions of the population living in poverty.

Is the upcoming cohort more vulnerable and less “ready” to transition than those countries that previously graduated? If it is, do multilateral agencies need to adjust their transition policies? To help answer these questions, in this working paper we compared two cohorts of countries: a “previous cohort” that graduated from IDA between 2010 and 2015, and an “upcoming cohort” that is anticipated to graduate from IDA, Gavi, or both in coming years. We compared the two cohorts across five categories of indicators: macroeconomic conditions, health financing, health performance, governance, and overall levels of poverty and inequality.

Overall, our findings suggest that, on average, the countries that graduated from IDA in the previous 2010-15 period had stronger capacity to manage the donor transition than that of upcoming graduates. The upcoming cohort seems to have, on average, lower per capita income, greater indebtedness, weaker capacity to efficiently use public resources, more limited and less effective health systems, weaker governance and public institutions, and greater inequality.

Keywords: transition, graduation, aid, official development assistance

Suggested Citation

Yamey, Gavin and Gonzalez, Diana and Bharali, Ipchita and Flanagan, Kelly and Hecht, Robert, Transitioning from Foreign Aid: Is the Next Cohort of Graduating Countries Ready? (July 16, 2019). Duke Global Working Paper Series No. 2019/08. Available at SSRN: https://ssrn.com/abstract=3420748 or http://dx.doi.org/10.2139/ssrn.3420748

Gavin Yamey (Contact Author)

Duke Global Health Institute ( email )

Trent Hall
310 Trent Drive
Durham, NC 27708
United States

Diana Gonzalez

Pharos Global Health Advisors ( email )

760 Boylston Suite 16J
Boston, MA 02116
United States

Ipchita Bharali

Duke University - Duke Global Health Institute ( email )

310 Trent Drive
Box 90519
Durham, NC 27710
United States

HOME PAGE: http://centerforpolicyimpact.org

Kelly Flanagan

Pharos Global Health Advisors Ltd ( email )

760 Boylston Suite 16J
Boston, MA 02116
United States

Robert Hecht

Pharos Global Health Advisors Ltd ( email )

760 Boylston Suite 16J
Boston, MA 02116
United States

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