Annex B. Supplemental data on financial flows to fragile states and economies

This annex elaborates on some of the findings in the main body of this report, providing additional statistical data particularly for Chapter 3 and Chapter 4. It also summarises supplemental data on financial flows to fragile states compared to other developing countries, provides country by country snapshots of per capita and percentage gross domestic product (GDP) flows, and provides details on the major providers of development co-operation and foreign direct investment.

Development co-operation in fragile states

Chapter 3 noted the uneven distribution of official development assistance (ODA) across fragile states, where it is often allocated to situations of geopolitical importance to development co-operation providers. Figure B.1 illustrates both of these points, showing flows to Iraq peaking dramatically in 2005 at over USD 9 billion and decreasing just as sharply while ODA flows to Afghanistan steadily increased throughout the period to 2012. When ODA allocation is politically driven, the countries that benefit often also suffer from volatility in those flows.

Figure B.1. Aid to select fragile states and economies, 2000-12
ODA excluding debt relief, constant 2012 USD billion
picture

Source: OECD (2014a), “Detailed aid statistics: ODA official development assistance: Disbursements”, OECD International Development Statistics (database), http://dx.doi.org/10.1787/data-00069-en.

 http://dx.doi.org/10.1787/888933185222

ODA, even excluding debt relief, includes elements such as humanitarian aid that can vary significantly from year to year. Country programmable aid (CPA) can give a better picture of aid flows. CPA is the portion of aid donors’ programme for individual countries, and over which partner countries could have a significant say. It excludes, among other things, spending which is inherently unpredictable or entails no flows to the recipient country. Table B.1 presents CPA between 2003 and 2012. Some fragile states, such as Afghanistan, which received the largest amount of CPA in 2012 among those on the fragile states list, show a strong increase in CPA over the decade. Others, such as Bosnia and Herzegovina, received far less in 2012 than they did in 2003. Another group of fragile states and economies, among them Timor-Leste, received about the same amount of CPA in 2012 as in 2003.

Table B.1. Country programmable aid to fragile states and economies, 2003-12
Constant 2012 USD million

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

Afghanistan

1463

2205

2851

2886

4920

3968

5745

5696

5923

6094

Bangladesh

1995

1924

1893

1817

1897

2463

1808

1909

2030

2748

Bosnia and Herzegovina

611

741

532

562

612

412

396

485

376

321

Burundi

151

259

244

299

377

403

433

537

466

457

Cameroon

332

447

325

500

572

526

637

538

548

559

Central African Republic

46

108

86

177

161

163

188

162

184

159

Chad

300

300

329

240

198

242

263

258

245

216

Comoros

24

23

18

26

37

37

44

65

42

55

Congo

60

141

117

116

99

127

81

114

160

97

Côte d’Ivoire

188

163

106

214

187

679

869

620

1200

698

Democratic People’s Republic of Korea

46

58

41

26

52

90

26

47

62

49

Democratic Republic of the Congo

645

909

1132

868

727

1175

1744

1592

1729

1584

Egypt

1768

2196

1664

1389

1706

2337

1639

1385

995

1819

Eritrea

202

179

206

98

128

104

98

126

110

124

Ethiopia

1011

1411

1297

1520

2089

2110

3051

2590

2669

2536

Guinea

278

266

233

209

242

245

176

216

305

331

Guinea-Bissau

87

81

61

78

111

111

133

116

100

58

Haiti

219

224

441

524

578

678

903

1287

1047

902

Iraq

1693

4225

8552

5688

4306

3010

2393

1994

1594

1192

Kenya

737

715

850

863

1273

1209

1629

1584

2186

2413

Kiribati

30

23

36

36

34

31

34

18

61

63

Kosovo

745

576

576

516

Liberia

33

80

105

136

644

649

355

457

462

453

Libya

19

34

14

78

43

38

58

97

Madagascar

550

855

673

728

779

797

392

439

352

331

Malawi

564

560

583

600

685

855

742

958

701

1039

Mali

693

692

817

846

891

921

974

1040

1213

695

Marshall Islands

68

60

66

59

57

57

63

96

84

77

Mauritania

241

218

188

201

313

408

352

375

351

361

Micronesia

141

103

123

122

127

100

128

132

135

114

Myanmar

130

106

127

124

146

175

194

284

275

379

Nepal

607

528

502

585

670

712

920

928

899

833

Niger

455

422

460

456

478

495

381

437

441

537

Nigeria

388

661

875

1056

1111

1338

1791

2091

1903

2031

Pakistan

1505

1990

1795

2542

2647

1982

3058

2380

2508

2300

Rwanda

358

495

570

562

689

873

903

975

1206

841

Sierra Leone

253

338

313

287

288

335

416

420

379

400

Solomon Islands

172

208

308

318

344

293

291

371

332

304

Somalia

90

77

79

110

115

176

185

238

270

412

South Sudan

-

586

701

Sri Lanka

1129

874

1036

1103

923

1032

1076

922

970

892

Sudan

464

326

652

863

813

1164

1119

1175

616

588

Syrian Arab Republic

346

288

236

192

224

306

268

251

396

183

Timor-Leste

239

207

224

236

263

267

228

277

243

271

Togo

60

66

74

75

103

321

221

218

252

164

Tuvalu

10

11

10

21

14

19

21

13

27

23

Uganda

1116

1263

1178

1366

1509

1324

1630

1634

1450

1560

West Bank and Gaza Strip

1286

1156

981

1121

1351

2058

2078

2110

1732

1529

Yemen

321

339

401

386

354

543

518

703

375

538

Zimbabwe

142

160

177

177

243

233

355

499

511

805

Source: OECD (2014b), “Detailed aid statistics: Country programmable aid (CPA)”, OECD International Development Statistics (database), http://dx.doi.org/10.1787/data-00585-en.

 http://dx.doi.org/10.1787/888933185237

Remittances to fragile countries and economies

While development co-operation is critical for many states, remittances are an even larger aggregate financial flow to fragile situations (see Chapter 3). Both fragile and non-fragile developing countries have received increasing remittance flows per capita, but remittance inflows per capita to fragile states have outpaced those to other developing countries consistently since 2000 as shown in Figure B.2.

Figure B.2. Remittances per capita, 2000-12
Constant 2012 USD
picture

Sources: World Bank (2014c), “Personal remittances, received (current USD)”, World Development Indicators (database), available at: http://data.worldbank.org/indicator/BX.TRF.PWKR.CD.DT; World Bank (2014d), “Population total”, World Development Indicators (database), available at: http://data.worldbank.org/indicator/SP.POP.TOTL.

 http://dx.doi.org/10.1787/888933185242

Remittances are also shown on a per capita and percentage GDP basis in Table B.2 and Table B.3. Countries and economies depend on remittance inflows to varying extents. Haiti, Nepal, and the West Bank and Gaza Strip all received remittance inflows worth more than 20% of their total GDP for the year in 2012. That is significant, especially considering these flows go directly to households.

Foreign direct investment and other official flows to fragile situations

Fragile states receive more ODA and remittances per capita than other developing countries. The opposite is true in regard to foreign direct investment (FDI) inflows (Figure B.3). In 2012, on average, fragile states received per capita inflows that were only one-fifth of those of other developing countries.

Separating flows by fragile and other developing economies underscores the extreme volatility of FDI between 2000 and 2012 to all developing countries. Developing countries, fragile states included, received increased flows in the 2000s, but these dropped sharply during the financial crisis of 2008 and 2009. FDI to non-fragile developing states then steadily recovered, and reached near pre-crisis levels by 2012. However, FDI to fragile states has continued to steadily decline.

Figure B.3. Foreign direct investment per capita, 2000-12
Constant 2012 USD
picture

Sources: World Bank (2014a), “Foreign direct investment, net inflows (% of GDP)”, World Development Indicators (database), available at: http://data.worldbank.org/indicator/BX.KLT.DINV.WD.GD.ZS; FDI as a percentage of GDP converted to USD using World Bank (2014b), “GDP (current USD)”, World Development Indicators, available at: http://data.worldbank.org/indicator/NY.GDP.MKTP.CD; World Bank (2014d), “Population total”, World Development Indicators (database), available at: http://data.worldbank.org/indicator/SP.POP.TOTL.

 http://dx.doi.org/10.1787/888933185256

Nonetheless, FDI remains an important financial flow for many fragile states. As an example, Cameroon receives almost as much FDI per capita (USD 24.43) as it does ODA (USD 27.47). In the Republic of the Congo, FDI inflows per capita (USD 635.90) are far greater than ODA per capita (USD 31.08) (Table B.2).

This report also examines non-concessional other official flows (OOF). OOF are transactions by the public sector with developing countries which do not meet the conditions for eligibility as ODA, either because they are not primarily aimed at development or because they have a grant element of less than 25%. As with FDI, considerably more OOF per capita flows to non-fragile developing countries than to fragile states, as seen in Figure B.4. It may be more challenging for fragile states to seek and/or be offered OOF.

While OOF to fragile states tends to be much smaller in magnitude, in several fragile states, such as Guinea, Liberia, Mauritania and the Solomon Islands, OOF inflows consisted of more than 2% of GDP in 2012.

Figure B.4. Other official flows per capita, 2000-12
OOF excluding debt relief, constant 2012 USD
picture

Sources: OECD (2014c), “Detailed aid statistics: Other official flows OOF”, OECD International Development Statistics (database), http://dx.doi.org/10.1787/data-00075-en; World Bank (2014d), “Population total”, World Development Indicators (database), available at: http://data.worldbank.org/indicator/SP.POP.TOTL.

 http://dx.doi.org/10.1787/888933185263

Relative financial flows to fragile states by country

As Table B.2 and Table B.3 demonstrate, there is a degree of variation in the individual per capita and percentage GDP flows to each fragile state and economy. Afghanistan received far more in ODA than any other flow per capita in 2012; at the same time, the Republic of the Congo and Egypt received far more in FDI and remittances respectively. A few states, such as Guinea and Mauritania, received significant OOF when measured in terms of both per capita and percentage GDP. These variations underscore the importance of assessing financial flows to individual fragile states, which can shift dramatically from one point in time to another, as well as looking at the overall picture of financial flows to fragile states.

Table B.2. Financial flows per capita by fragile state or economy
2012 USD

Foreign direct investment inflows

Official development assistance (excluding debt relief)

Other official flows (excluding debt relief)

Remittance inflows

Afghanistan

3.15

225.44

1.81

12.91

Bangladesh

9.53

13.91

2.21

91.27

Bosnia and Herzegovina

91.19

148.97

56.95

482.23

Burundi

0.06

53.00

0.00

4.71

Cameroon

24.23

27.47

4.97

9.70

Central African Republic

15.73

50.04

Chad

27.54

38.40

2.91

Comoros

14.46

90.29

Congo

635.90

31.08

0.50

Côte d’Ivoire

16.23

30.46

Democratic People’s Republic of Korea

4.85

3.86

0.09

Democratic Republic of the Congo

44.01

33.69

0.68

0.19

Egypt

34.66

21.58

12.88

238.30

Eritrea

6.75

21.82

Ethiopia

3.04

35.51

1.06

6.81

Guinea

52.87

25.43

11.54

5.79

Guinea-Bissau

3.98

47.16

Haiti

15.33

125.27

0.96

158.48

Iraq

104.36

39.93

8.32

Kenya

5.99

61.06

6.11

28.11

Kiribati

8.43

41.56

8.33

Kosovo

162.25

314.14

0.75

586.04

Liberia

234.96

136.25

8.95

Libya

231.53

14.15

Madagascar

36.44

16.97

1.40

Malawi

8.14

73.77

1.78

Mali

26.79

67.31

0.00

Marshall Islands

65.19

1446.29

0.76

Mauritania

364.44

107.46

86.07

Micronesia

7.74

1112.63

15.38

Myanmar

42.48

9.54

0.03

2.41

Nepal

3.35

27.81

0.16

174.47

Niger

49.03

52.52

0.17

Nigeria

42.06

11.35

0.94

122.21

Pakistan

4.79

11.18

5.11

78.18

Rwanda

13.95

76.64

6.16

15.92

Sierra Leone

91.67

74.04

6.98

10.20

Solomon Islands

124.19

554.91

63.26

31.24

Somalia

10.53

97.95

South Sudan

145.61

Sri Lanka

46.30

23.98

16.46

295.14

Sudan

62.18

26.43

1.69

10.79

Syrian Arab Republic

74.62

0.72

Timor-Leste

17.47

246.37

1.70

98.95

Togo

14.12

28.57

11.17

Tuvalu

2483.77

20.28

Uganda

33.16

45.54

4.03

25.05

West Bank and Gaza Strip

44.38

497.03

7.58

508.96

Yemen

0.60

29.74

Zimbabwe

29.11

72.95

1.62

Sources: ODA excl. debt and OOF from OECD (2014a), “Detailed aid statistics: ODA official development assistance: Disbursements”, OECD International Development Statistics (database), http://dx.doi.org/10.1787/data-00069-en and OECD (2014c), “Detailed aid statistics: Other official flows OOF”, OECD International Development Statistics (database), http://dx.doi.org/10.1787/data-00075-en; remittances and FDI inflows, population data from World Bank (2014d), “Population total”, World Development Indicators (database), available at: http://data.worldbank.org/indicator/SP.POP.TOTL.

 http://dx.doi.org/10.1787/888933185279

Table B.3. Financial flows as a percentage of GDP in fragile states and economies, 2012

Foreign direct investment inflows (%)

Official development assistance (excl. debt relief) (%)

Other official flows (excl. debt relief) (%)

Remittance inflows (%)

Afghanistan

0.5

32.8

0.3

1.9

Bangladesh

1.3

1.9

0.3

12.2

Bosnia and Herzegovina

2.1

3.4

1.3

11.0

Burundi

0.0

21.1

0.0

1.9

Cameroon

2.0

2.3

0.4

0.8

Central African Republic

3.3

10.4

Chad

2.7

3.7

0.3

Comoros

1.7

10.9

Congo

20.2

1.0

0.0

Côte d’Ivoire

1.3

2.4

0.2

Democratic People’s Republic of Korea

Democratic Republic of the Congo

10.5

8.1

0.2

0.0

Egypt

1.1

0.7

0.4

7.3

Eritrea

1.3

4.3

0.0

Ethiopia

0.7

7.6

0.2

1.5

Guinea

10.7

5.2

2.3

1.2

Guinea-Bissau

0.8

9.5

Haiti

2.0

16.2

0.1

20.4

Iraq

1.6

0.6

0.1

Kenya

0.6

6.5

0.7

3.0

Kiribati

0.5

37.0

0.5

Kosovo

4.5

8.8

0.0

16.4

Liberia

56.8

32.9

2.2

Libya

1.7

0.1

Madagascar

8.2

3.8

0.3

Malawi

3.1

27.7

0.7

Mali

3.8

9.7

0.0

Marshall Islands

2.0

43.9

0.0

Mauritania

34.9

10.3

8.3

Micronesia

0.2

35.3

0.5

Myanmar

Nepal

0.5

4.0

0.0

25.0

Niger

12.4

13.3

0.0

Nigeria

1.5

0.4

0.0

4.5

Pakistan

0.4

0.9

0.4

6.2

Rwanda

2.2

12.3

1.0

2.6

Sierra Leone

14.5

11.7

1.1

1.6

Solomon Islands

6.8

30.5

3.5

1.7

Somalia

South Sudan

0.0

14.9

0.0

Sri Lanka

1.6

0.8

0.6

10.1

Sudan

3.7

1.6

0.1

0.6

Syrian Arab Republic

Timor-Leste

1.5

20.9

0.1

8.4

Togo

2.4

4.8

1.9

Tuvalu

0.0

61.4

0.5

Uganda

6.0

8.3

0.7

4.5

West Bank and Gaza Strip

1.8

19.6

0.3

20.1

Yemen

0.0

2.2

Zimbabwe

3.2

8.0

0.2

Sources: ODA excl. debt relief and OOF excl. debt relief from OECD (2014a), “Detailed aid statistics: ODA official development assistance: Disbursements”, OECD International Development Statistics (database), http://dx.doi.org/10.1787/data-00069-en and OECD (2014c), “Detailed aid statistics: Other official flows OOF”, OECD International Development Statistics (database), http://dx.doi.org/10.1787/data-00075-en; remittance and FDI inflows, GDP from World Bank (2014a), “Foreign direct investment, net inflows (% of GDP)”, World Development Indicators (database), available at: http://data.worldbank.org/indicator/BX.KLT.DINV.WD.GD.ZS; FDI as a percentage of GDP converted to USD using World Bank (2014b), “GDP figures (in current USD)”, World Development Indicators (database), available at: http://data.worldbank.org/indicator/NY.GDP.MKTP.CD; World Bank (2014c), “Personal remittances, received (current USD)”, World Development Indicators (database), available at: http://data.worldbank.org/indicator/BX.TRF.PWKR.CD.DT.

 http://dx.doi.org/10.1787/888933185288

Providers of development co-operation and foreign direct investment to fragile states and economies

Most of this report explored financial flows from the recipient perspective. It is also important, however, to look at the source of such flows. Figure B.5 shows the top providers of ODA to fragile states and economies in 2012. This list largely comprises OECD countries as well as some non-OECD aid donors who choose to voluntarily report their ODA contributions to the OECD.

OECD donors provide the largest amount of aid to fragile states, with the United States topping the list, followed by EU institutions and the United Kingdom. Other bilateral donors and multilateral organisations are also playing a key role in providing development co-operation to fragile states.

Table B.4 shows the largest providers of FDI to fragile states. It is important to note that these figures only present data on OECD member countries for which there is matched FDI data, so this dataset excludes most non-OECD FDI investors in fragile states. Figures for the average FDI investment between 2008 and 2012 were used as year-on-year point estimates and vary quite significantly. Nonetheless, the picture looks similar to that of the ODA donors with some exceptions.

The United States outpaces other top FDI investors in fragile states, followed by the United Kingdom, France and Italy. FDI in fragile states from France and Italy was larger in 2012 than public aid flows from those two countries, which underscores the significant investments made by their private sectors.

Figure B.5. Providers of official development assistance to fragile states and economies
picture

Source: OECD (2014a), “Detailed aid statistics: ODA official development assistance: Disbursements”, OECD International Development Statistics (database), http://dx.doi.org/10.1787/data-00069-en.

 http://dx.doi.org/10.1787/888933185294

Table B.4. Top 10 OECD foreign direct investors in fragile states
Average 2008-12, USD million

Average foreign direct investment

United States

4067.80

United Kingdom

1935.30

France

1514.87

Italy

1240.98

Luxembourg

1214.87

Korea

775.41

Germany

725.89

Japan

492.79

Belgium

412.56

Switzerland

255.58

Source: OECD (2014d), “Foreign direct investment: Flows by partner country”, OECD International Direct Investment Statistics, (database), http://dx.doi.org/10.1787/data-00335-en.

 http://dx.doi.org/10.1787/888933185306

References

OECD (2014a), “Detailed aid statistics: ODA official development assistance: Disbursements”, OECD International Development Statistics (database), http://dx.doi.org/10.1787/data-00069-en.

OECD (2014b), “Detailed aid statistics: Country programmable aid (CPA)”, OECD International Development Statistics (database), http://dx.doi.org/10.1787/data-00585-en.

OECD (2014c), “Detailed aid statistics: Other official flows OOF”, OECD International Development Statistics (database), http://dx.doi.org/10.1787/data-00075-en.

OECD (2014d), “Foreign direct investment: Flows by partner country”, OECD International Direct Investment Statistics (database), http://dx.doi.org/10.1787/data-00335-en.

World Bank (2014a), “Foreign direct investment, net inflows (% of GDP)”, World Development Indicators (database), available at: http://data.worldbank.org/indicator/BX.KLT.DINV.WD.GD.ZS.

World Bank (2014b), “GDP (current USD)”, World Development Indicators (database), available at: http://data.worldbank.org/indicator/NY.GDP.MKTP.CD.

World Bank (2014c), “Personal remittances, received (current USD)”, World Development Indicators (database), available at: http://data.worldbank.org/indicator/BX.TRF.PWKR.CD.DT.

World Bank (2014d), “Population total”, World Development Indicators (database), available at: http://data.worldbank.org/indicator/SP.POP.TOTL.

ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT

The OECD is a unique forum where governments work together to address the economic, social and environmental challenges of globalisation. The OECD is also at the forefront of efforts to understand and to help governments respond to new developments and concerns, such as corporate governance, the information economy and the challenges of an ageing population. The Organisation provides a setting where governments can compare policy experiences, seek answers to common problems, identify good practice and work to co-ordinate domestic and international policies.

The OECD member countries are: Australia, Austria, Belgium, Canada, Chile, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea, Luxembourg, Mexico, the Netherlands, New Zealand, Norway, Poland, Portugal, the Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Turkey, the United Kingdom and the United States. The European Commission takes part in the work of the OECD.

OECD Publishing disseminates widely the results of the Organisation’s statistics gathering and research on economic, social and environmental issues, as well as the conventions, guidelines and standards agreed by its members.

OECD PUBLISHING, 2, rue André-Pascal, 75775 PARIS CEDEX 16

(43 2015 01 1 P) ISBN 978-92-64-22178-9 – 2015

States of Fragility 2015

MEETING POST-2015 AMBITIONS

Contents

Chapter 1. Fragility in the post-2015 framework

Chapter 2. The changing face of fragility and its implications post-2015

Chapter 3. Taking stock of financing to address fragility

Chapter 4. Moving from fragility to resilience post-2015

Consult this publication on line at http://dx.doi.org/10.1787/9789264227699-en.

This work is published on the OECD iLibrary, which gathers all OECD books, periodicals and statistical databases. Visit www.oecd-ilibrary.org for more information.

ISBN 978-92-64-22178-9

432015011P