This week in development…
- USAID has announced that they will tap into an emergency trust fund – one that has not been touched since the global food price spike and crisis in 2008 – to respond to the extreme food insecurity in South Sudan. “The scale of the suffering and humanitarian need there is shocking, and the threat of famine is real,” said National Security Advisor Susan Rice in a statement profiling the $180 million that will be drawn from the fund. The account being drawn upon is specifically allocated to Food for Peace programming, and intended to meet emergency or unanticipated food aid needs.
- August 18 is the 500 day milestone until the target date to achieve the United Nations Millennium Development Goals. The questions of “were the MDGs successful?” and “where do we go from here?” have begun to dictate the discussions and work of the development community, as attention shifts towards the post-2015 development agenda. Brandon Stanton, the photographer behind the acclaimed street photography blog Humans of New York, has partnered with the UN to take a 50-day “World Tour” to raise awareness of the MDGs and informally track their progress.
By Sarah Carson
On July 20, President Ninoy Aquino signed a law removing a longstanding 60 percent ownership cap on foreign banks. Previously, only ten banks were permitted to have fully owned operations in country, including Bank of America and Citigroup.
On a broad scale, this new banking liberalization policy has enormous potential to help the Philippines become the next “economic miracle in Asia.” The reform agenda will likely result in increased foreign investment but also new livelihoods, technologies, and capacity for the Philippines ahead of the ASEAN Banking Integration Framework (ABIF), which will open Philippine banks to competition from within ASEAN starting in 2015. In this regard, the reform may help remedy the Philippines’ persistently poor performance relative to comparable ASEAN neighbors in terms of FDI and employment rate.
Major shifts lie ahead for the Philippine financial sector, but one of the most important changes likely to occur is the influx of foreign direct investment (FDI). Historically, FDI in the Philippines has hovered between $2-4 billion per year. Many regional neighbors, such as Malaysia, Thailand, Vietnam, and Indonesia have been much more successful in this domain, partly due to less restrictive policies regarding foreign banks.
Data Source: World Bank Continue reading