Reaching the marginalized: EFA global monitoring report, 2010; 2010

0120CHAPTER 1Education for All Global Monitoring ReportMuch of whathas beenpresented as‘new andadditional’finance is in factrepackaged orreprogrammedaidThe internationalresponse: missinga human dimensionThe threat that the financial crisis poses tointernationally agreed human development goalsis widely recognized. The G20 communiqué ofApril 2009 acknowledged the ‘human dimensions’of the threat in particularly forthright terms(Group of Twenty, 2009, para. 25):We recognise that the current crisis has adisproportionate impact on the vulnerable inthe poorest countries and recognise our collectiveresponsibility to mitigate the social impact ofthe crisis to minimise long-lasting damage toglobal potential.Subsequent gatherings have reaffirmed theconcern. At the G8 summit in July in L’Aquila,Italy, the governments of the world’s richestnations declared that they remained focused onthe human and social consequences of the crisis.‘We are determined’, their communiqué declared,‘to undertake measures to mitigate the impact ofthe crisis on developing countries, and to continueto support their efforts to achieve the MillenniumDevelopment Goals’ (Group of Eight, 2009c,para. 6). To what extent have political leaders inthe countries that caused the crisis acted on their‘collective responsibility’ to mitigate its effects?Financial resources have been made availableon a large scale, both domestically andinternationally. Advanced economies have spentaround US$10 trillion shoring up their financialsystems by providing capital, loan guarantees,lending and asset protection. That figurerepresents around 30% of their combined GDP.Under the G20 recovery plan, the IMF has beenused to strengthen global liquidity and bolsterfragile financial systems. This national andinternational response has been vital to stavingoff a far deeper global crisis and creating theconditions for recovery. After a severe globalrecession, economic growth has turned positiveas wide-ranging public finance interventions havesupported demand and reduced financial risk.Yet the report card on support for the poorestcountries is deeply unimpressive.Headline figures on global financing have maskedthree problems. First, the poorest countries havebeen largely bypassed (Woods, 2009b). As thepresident of the African Development Bank put it,‘only a small proportion of the resourcesannounced at the G20 summit in London willtrickle down to low-income countries’ (Kaberuka,2009). Second, much of the support that doestrickle down will arrive too late and on termsthat are inappropriate for the financing needsof the poorest countries.The third concern is that much of what has beenpresented as ‘new and additional’ finance is in factrepackaged or reprogrammed aid. This ‘smokeand mirrors’ financial reporting has obscuredthe collective failure of developed countries todecisively deliver resources on the required scale.Some new resources have been made available,principally through the IMF. In the case of theWorld Bank, which G8 and G20 rhetoric placesat the centre of the crisis response for the poorestnations, very few additional resources have beenmobilized (Woods, 2009b). Instead, the institutionhas been left to reconfigure its resources tomount a response.Consolidating current financing for low-incomecountries is problematic because of uncertaintiesover commitments. On an optimistic assessment,new concessional financing potentially available tolow-income countries amounts to between aroundUS$2 billion and US$3 billion annually for the nexttwo to three years. 8 That figure has to be setagainst the annual revenue loss of US$80 billionfor sub-Saharan Africa alone in 2009.It is easy to lose sight of what is at stake for theinternational development goals in education.The everyday concerns of parents struggling tokeep their children in school in a slum in Lusakaor a poor village in Senegal seem far removedfrom the international summits on the globalfinancial crisis. Yet the connections are real. Asrich countries take the first steps towards economicrecovery, the aftershock of the crisis is jeopardizingthe efforts of the world’s poorest households tosecure for their children an education that mightlift them out of poverty. Containing the aftershockwill require a strengthened focus on financingfor human development.8. In the period to 2010, IMF concessional loans could rise by up toUS$8 billion. The estimate for this Report adds US$2 billion for variouscommitments undertaken through bilateral aid programmes andWorld Bank trust funds, though this is almost certainly an overestimate.32