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Health, education, climate, the United nations, the.
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World bank, private actors, locally rooted institutions, locally rooted experts.
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What we're really talking about is a very complex ecosystem. How do we find the interlinks to innovate and come up with the best solutions to actually rethink what we do as a broader development community?
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You're listening to the CGD podcast where we explore smart policies for a better world.
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Each episode highlights an important development topic hosted by a CGD researcher and featuring experts from around the globe. Tune in to learn how independent research.
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Can bring global prosperity.
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Hello and welcome to the CGD podcast. I'm Anita Cappelli, Director of Policy Outreach Europe at the Centre for Global Development. Today we're talking about the Commitment to Development Index.
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The CDI ranks the world's leading economies on how their policies affect the life of people in poor countries. I'm joined by Ian Mitchell, senior policy Fellow at CGD and lead author of the cdi. Ian, over the last few years, lots of the established donors have stepped back from providing aid, a lot of them to fund their own geopolitical priorities. They've also stepped back from multilateral commitments, most drastically the US The Commitment Development Index, however, looks at much more than just how much aid countries give. What can you tell us about the cdi, how it's measured and why it's important?
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Hi Anita. Yeah, glad to. So the CDI is a tool to assess countries and what their policies are doing for international development, and particularly what they do for people in the poorest countries in the world. So it measures eight policy areas. One of those is development, finance or aid. We also cover issues like migration, trade, investment, technology, environment, security and health.
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Great. Okay, so the 2025 update is just out and what overall trends are we seeing? I saw you wrote blog which is called the Forgotten Policies that Still Matter for Development. Do you feel like the 2025 edition is particularly important given the country stepping back from aid?
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I think for the first time that we're seeing is a real step back from the majority of countries that we assess. So we look at 38 countries and we think 24 of them are doing less than our last assessment in terms of their contributions to international development. That effect is perhaps strongest among the top 10, where nine of the countries we assess are doing less on the key indicators. So countries that have previously been development leaders are absolutely stepping back in their contribution. And that's not just in aid. That's across policies from security, trade and migration and other areas. I think there is a tendency for People that are really interested in development and who care about what happens in poor countries to focus on aid, and understandably because it can have really big impacts. But I think it does mean that other policies are neglected and that sometimes opportunities are missed to focus on things that could really matter. So in this year's edition, for example, we look at harmful subsidies. So we track agriculture subsidies, which can make it difficult for low income country farmers. We look at fossil fuel subsidies, which are particularly bad for the climate. And we look at fishery subsidies, which exacerbate overfishing and are also unhelpful environmentally. So what we see there is a kind of mixed picture, actually. There was some progress on fishing subsidies in the period since we looked at this last, there was a WTO World Trade Organization agreement on those. But on fossil fuels, in the period we looked at, partly because of Russia's invasion of Ukraine, there was a big increase in fossil fuel subsidies. And even though energy prices are now coming down, we're not seeing those subsidies come down as quickly as they could. And we think this is an area, for example, that progress could be made at the G7 and at the G20.
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So overall, obviously listeners are probably very interested to know, apart from the areas that you just mentioned, which country comes top, who is leading. You mentioned the G20 countries, the G7 countries. Are there any countries that stood out this year?
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Let's talk about the countries that do best. We'll come on to the fact that they've stepped back. On the whole, those are still the countries that are doing the most to accelerate global development. So we assess Sweden as the top country. Their contribution fell in five of the eight areas we assess, but they still managed to maintain an environment that was stronger than others. They're very good on migration, in particular the integration of migrants into their country. They've also got strong environmental policies, including for example, a high carbon price. So they're still at the top of our index. Germany comes second. So that puts Germany as the top G7 and the top G20 country. They're strong on investment standards, they've made important contributions on migration, and they have quite open trade policies. That's why they do well. And then third is Norway, who have strengths in development, finance and also in health and investment. They've got some room for improvement on trade and environment. People obviously know they are a big fossil fuel producer. But Norway, we're actually the only country in our top 10 who increased their contribution between this edition of the CDI and the last one. So I think they're in a leadership role at the moment, Norway. And they deserve credit for their third place placing.
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And as far as I understand, the CDI doesn't reflect the latest aid cuts that we've seen this year. And you say that some countries are stepping back from multilateral commitments and we're always seeing a backsliding on aids. Why, when you've mentioned all the other policies that really matter for development, why then do you think is it that aid really actually does still matter? So what would you say to those voices perhaps would say that, well, aid is not relevant to poor countries these days and it's all about trade and other policies for economic growth.
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I think one of the issues is that developing countries, which covers three quarters of the world and the vast majority of the world's population, is too broad a group. And I think there are countries in that group that, as you say, really what matters to them is the trade environment, is their ability to borrow money from the multilateral banks or from other countries or markets and their policies. But for the poorest countries, say the poorest 50 countries, I think aid really matters. Sometimes when people are thinking about aid, they're thinking about the money that goes to middle income countries, to relatively well off countries. But I think if you're thinking about the very poorest countries in the world, the poorest 50, then the impact that grant aid can have in those countries is enormous. Whether it's health interventions that save the lives of children, mothers, whether it's nutrition and helping people develop fully, or water and sanitation. I think these things still have public support and I think that they still have a transformational effect on the lives of people that are reached with that support. They support security as well. I think we're kind of making a, a false economy, if you like, by cutting those aid budgets now because in years to come, the impacts that money would have had will not happen and will be in a less safe, less secure world.
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And a few years back you start to include a lot of T20 countries in the CDI. Originally it measured the policies of more of the, let's say, traditional donors, the European donors or the northern donors. And now we have all the G20 countries in the CDI all. Also a country like South Africa, which is a dual country, so a country that is both on the receiving end of aid and is also providing cooperation. What can the traditional countries learn from these G20 countries like Brazil also has the cop host that goes beyond those aid policies you just discussed.
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We brought these countries in just because their policies matter. So Much as well to partners and part, I would say as a group, that group, especially the middle income countries, they don't provide much in aid. And actually given some of their income levels, South Africa is a good example. We wouldn't expect South Africa to provide much aid because of the size and the income level of its economy. As you say, it should be a recipient. So where do we see them offering some examples to the other countries. So certainly on climate, India for example, has emissions that are somewhere around 2 tons of carbon dioxide equivalent per head in India across 1.4 billion people. Whereas in Europe it's more like 7 tonnes per head. In Australia and the US and Canada it's more like 18 to 20 tons per head. So obviously that's partly about where they are in development. But even if you look at their energy mix, they're on a more sustainable pathway than many of the high income countries. I think South Africa are our best scoring middle income country. They've actually performed strongly on migration partly because of the countries they're next to. They've accepted refugees from those countries. And we give credit where not many of the northern European countries accept refugees from the conflicts in Africa or outside of Europe. And that's one of the trends we've seen. Obviously Ukrainian refugees have gone up, but refugees from lower income countries definitely not go up to the same degree. So that's another area where those countries contribute. It's maybe worth the word on China as well, who are in our index and we don't actually assess them as performing very strongly, even though of course their finance matters hugely. The Belt and Road Initiative is China's flagship international development policy and it involves a series of financial loans to countries all around the world to improve their ability to trade and develop. Particularly of course, with China itself, we find that first their finances aren't as concessional or grant based as many countries. And so once you account for that, then the Belt and Road Initiative is not as big as it seems in terms of the face value. And as most people know, the transparency of China's efforts are really still lacking. It's very difficult to get the detail of the projects and the countries that it's working in. And we think that's important. And so we reward countries that are transparent about those things.
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What about smaller countries? Listeners might now think, okay, we've talked about China, we've talked about India. What are perhaps some examples of smaller countries who stood out positively that can teach basically lessons to other policymakers about what they can do for poor people in other countries. Any positive surprises that stood out this year?
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We haven't mentioned Finland, who ranked fourth in the index and they performed quite well across all of the areas. They're particularly strong on development finance and focusing that where it matters most. We also had some of the biggest movers with kind of smaller countries in the index this year. Luxembourg and Ireland Both moved up four places in the index. Luxembourg ranking 10th, Ireland ranking 19th. Luxembourg have got really strong development finance. They exceed the odor target that was agreed at the UN of 0.7% of GNI on official development assistance. And when you look at the quality of that finance as well, we think it's very strong. It's focused in the countries that need it, it's transparent and it supports multilateralism. So they get a lot of credit for that. They improve their peacekeeping contributions this year, which many countries haven't. I guess because of the other pressures on security elsewhere, peacekeeping contributions have gone down, which is unfortunate. But Luxembourg have bucked that trend. Ireland as well, they've also improved their migration policies and accepted a larger number of migrants than when we last looked at them. They've also increased a little bit on development finance. We think they could do more on quantity of development finance. Ireland are actually a very high income country now and so for them to rank 19th, there is still room for improvement. They don't provide a lot of research and development funding, for example, and they've got relatively high emissions per head as well, which might surprise some people. So we're glad to see Ireland moving up the index and we think there's.
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More they can do to perhaps take up on this last point. The emissions per head. The emissions per head have been declining in the last few years, which is obviously very, very positive trend. However, there's a couple of countries that have increased their emissions, which kind of brings us back to what you said in the beginning with the fossil fuel subsidies. Why do they matter so much to development and what's something that you feel like will be perhaps a quick win on the environment that countries really can do to do better?
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I think the emissions finding is really interesting and probably is counter to what most people would expect. The emissions reductions plans are basically disappointing, but actually in the 38 countries we look at, the vast majority of them have reduced their emissions and their emissions per head in the past two years. The only problem, I guess is that those reductions in most countries were outweighed by the increase in emissions in China and China at a different point in their development. I think their emissions will be peaking soon. But I think what it demonstrates is you absolutely need the big countries to be reducing their emissions as well. Emissions is kind of an outcome of many policies. I think one of the important ones is the amount of subsidies that countries give to fossil fuels. Many of the countries we're looking at are struggling economically and fiscally. They're looking for budget savings. But globally we're spending hundreds of billions of dollars on subsidizing fossil fuels. So we're making the climate worse and we're essentially wasting money on those industries. So we've highlighted this as an area of potential improvement. One of the interesting things about this is whilst it's hard to imagine the current US administration having climate ambition is actually not one of the worst offenders on fossil fuel subsidies. So it's quite a small portion of the US budget that's spent on fossil fuel subsidies. So as they take the G20 chair, could there be an alliance where they say, well, look, we don't want to see other countries wasting their money on fossil fuel subsidies. And for the other countries, it's a chance to improve their environmental performance, if you like. So with energy prices coming down, maybe there's a chance for France's G7 share and us as G20 chair to make some progress on this issue and accelerate the reduction of those subsidies.
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I think a lot of listeners are probably curious about the US and their results. So are there any other areas where you feel like the US could lead the way next year as a G20 chair? And see the data, they reflect a lot of the decisions that were taken under the Biden administration. But if you can tell us a bit more about the US results and where they might be able to be delay next year.
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Nearly all of our data reflects the Biden administration for the us. But even with that being the case, the US fell two places, actually. Its development finance went down before the Trump administration came in and we ranked it 28th out of the 38 countries that we look at. So, you know, in our framework and our assessment, we didn't feel as though the US was doing a huge amount for global development even before Trump arrived. And now those cuts in aid are very steep, very damaging, as most listeners will know. So I think even though other countries are reducing their aid budgets, when we come to do it again, then the US will certainly be falling down the index. I guess we've highlighted one area that the fossil fuel subsidies, where we think there's a positive contribution. I think also the US in the top half on investment standards. It tends to be quite careful about corruption and is reasonably transparent in some areas. It does have some issues with financial secrecy. It's not perfect in that respect. I have had some conversations with U.S. officials in the past and they said, well, our main contribution is on security and we find that so, for example, the US provides a lot of protection to sea lanes and that's very relevant at the moment. Although the tariffs are making trade more difficult for most countries, actually keeping trade open and ensuring that it can pass through sea lanes is important. The US make a major contribution to that that is sometimes forgotten. Security, I suppose, is one area where the US does have some strengths.
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Are there any other countries that stood out, perhaps that also the U.S. leadership that they could work together with, who have actually countries that have reduced their subsidies despite the pressure on a cheap prices that we've seen since the Russian invasion of Ukraine?
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Yeah, the fossil fuel story is interesting because in response to Russia's invasion of Ukraine, energy prices spiked. Countries responded by subsidizing fossil fuels to help their consumers, but now that energy prices are dropping back, it should open the door to reductions. In fact, some countries have already started to reduce their fossil fuel subsidies. And those countries include Argentina, that have made a big reduction, also Australia, Indonesia, Turkey and Brazil. So those countries, in spite of relatively high energy prices, have been able to cut back fossil fuel subsidies. And I think that demonstrates it is.
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Possible to stay on the subsidies. You also look at fishing subsidies in the cdi. Can you just explain why these are harmful or the way the countries provide them are harmful and which countries are actually leading the way?
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So in terms of fishery subsidies, we look particularly at harmful subsidies. And the reason we do that is many countries have struggled with overfishing and clearly there's only a limited supply of fish that needs to be shared among nations. And what we find is if countries are subsidizing their fisheries to bringing extra fish or on the basis of landings, then that can lead to overfishing and it can really harm the countries that share those waters. And so for those subsidies that encourage fishers to go out and take more than they need, we penalise countries for those subsidies. There are other subsidies that we think are more valuable, for example, that cover research and development. And some countries actually pay fishermen to leave fish in the sea. And so we don't penalise for those. What we find is two examples of countries that do particularly well in this indicator. New Zealand and Chile. Those countries don't need to provide subsidies to their fishing industries for them to be successful, and they're a Good example to others really of the need to reduce them. The World Trade Organization recently made an agreement on fisheries to reduce the level of subsidy. And again, it's one of these areas where if countries do it together, it's much easier. It's an easier sell to your industry to say, well, everybody is reducing their subsidies, so your competitors will also be losing their subsidies than it is just to do it as an individual country. And I guess shows the value of some international agreements do still work.
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So one other area you measure in the CDI is research and development or R and D. Why is it relevant to people in poor countries? Obviously you could say that investing in R and D, be it private investment or public investment, primarily supports your local industry and academia and perhaps tech companies, et cetera. So how does it affect other people's lives and which countries are standing out are doing particularly well on this component?
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Yeah, good question. I think with research and development, a lot of people refer to that as a global public good. So even research that happens in your own country probably has some relevance to other countries. If, for example, you were doing education research, it might discover something that's useful to everybody. I guess the sorts of research that we particularly appreciate and value in development are the ones that tackle problems in lower income countries. So for example, vaccines that tackle diseases that are prevalent in low income countries, but also health research more generally obviously benefits everybody. So that's the thing that we look at in the cdi we say, are countries investing in research and development through their government? Are they incentivizing their companies to invest in research? Maybe a good example of that might be solar technology, which I think most people credit to some research that started in Germany that is now benefiting everybody in the form of cheap energy prices and tackling climate change. So that's what we look at in the CDI and that's what we value. And maybe that's one of those areas as well where I said at the top of the program, the aid advocates could be too focused on the amount of money their governments send overseas. Research and development budgets are very significant. They run to hundreds of billions a year. There are multiple of the aid budget. I think we're focused on tackling global problems which have affected nearly all of us in recent years. Whether it's Covid or energy prices or the financial crisis going back even further. Those are really global problems. And if R and D was targeting those global problems more than the domestic problems, then maybe that would mean more prosperity for all of us.
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Coming back to Sweden, the leading country in this year's cdi. You mentioned earlier that Sweden is doing particularly well on migration and on migration integration. So integrating refugees and migrants. Are there any other countries that are standing out on this component? And also, why do you differentiate between refugees and migrants? And how are migrants, as in labor migrants? How does that contribute to global development?
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I think it's worth starting from saying migration is really important to global development. When people move between countries, not only do they benefit themselves and often the country that is receiving them, they also send back money in the form of remittances. Those remittances are used in the part of the country. And I think CGD research over a period of time has shown that it's a mutual benefit and it's a big driver of progress in lower income countries. So that's why we measure it. And then as you highlight, we look at several aspects of this actually, and one of them is just the broad number of people and whether they're coming from lower income countries, you know, the general level of migration and then the sort of more acute issue of refugees and whether countries are accepting refugees. And it's that second category, I guess, where we've seen the big increases in numbers and that is partly driven by the war in Ukraine, where many of our countries in the CDI have accepted quite large numbers of refugees from Ukraine. So that has, you know, I mean, that's not an improvement in the world in the sense that there are more people fleeing war, but it is increasing the contribution of those countries. I think also the other thing that we look at is how well countries integrate migrants into their society. And actually Sweden, who top the index score extremely well on that. So this looks, for example, whether migrants are given language training, whether they can get access to education and the labor market so that they can make a contribution immediately after their arrival and start to integrate with their communities. And I guess that's one of the lessons. You see a very wide variation in performance on that indicator in the index. And, and I'm sure that's one of the reasons that you're seeing a backlash against migration in many of the countries that we cover, partly because that integration hasn't been done well enough.
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And to perhaps zoom out a bit, you've just kind of like talked about overall trends in some of our countries and recent policy developments. How would listeners who perhaps work in global development or study global development, how should they use the cdi or what would you advise? How can we use this index? And the same thing for policymakers, if you know, policymakers who perhaps work in global development, they might say, okay, great, I might know where my country stands on aid, but there's not much I could do on trade or migration. What would you advise our listeners on how to use the cdi?
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I think what we want from policymakers and advocates is to use the index like a tool and think about in the country where you operate, where is there political space for improvement on these policy areas? So maybe the aid debate is settled in the country that you work in for the coming years. But what about trade? What about research and development? What about technology and support for foreign students? Are these policy agendas that there's political space to advance and for countries to do more on? I think for policymakers in particular, we often say when we speak to officials, please use the CDI as a prompt when you talk to other departments. So if you're in a development ministry or a foreign ministry, you can see, you know, we're evidence based quantitative assessment of countries policies. And you can take that to other ministries as an objective basis to say, look, we're not doing as well as other countries. Maybe in the trade department, we're risking on losing out on markets, on relationships, on trade, maybe the same investment in the investment component With Treasuries and finance ministries, we think that it can start a conversation based on evidence. So that's how I'd encourage people to use it. And you know, we do detailed country reports on all 38 countries that highlight their strengths and weaknesses. And even though maybe it doesn't have the perfect policy answer in the cdi, it can point you towards the right area. We sometimes say don't take it literally, but take it seriously.
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So really kind of encouraging a race to the top. Ideally, this is not your first cdi and I'm kind of wrapping up now with one of our standard CGD podcast questions. If you could wave a magic wand and change one single policy or policy area, ideally one that is actually captured in the cdi, what policy would you choose and why?
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I would like to see a serious economic framework around carbon emissions. So that would mean carbon prices, carbon trading, and using economic tools to tackle climate change. I think there's far too much focus on climate finance and I think there's far too much focus on small initiatives. I think to tackle climate change we need to tax carbon emissions and we can't afford to spend our way through it. Subsidies would be too expensive. And so until a majority of the world's countries start doing that and working out how we trade between those countries, then I think we're not going to defeat climate change. And that's why key policy ask.
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Excellent. Thanks so much Ian for joining me today. And thank you to you, our listeners, for staying with us for learning more about the cdi. Please do explore the CDI on our website and don't hesitate to send us comments and feedback.
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Thanks for listening to the CGD podcast.
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You can learn more about the topics discussed on our website at cgdev.org@cgdev.org see you next time.
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Sam.