LATAM: Pandemic status and outlook
Covid-19 caseloads have been dropping across Latin America and the Caribbean in recent weeks. During October, South America has accounted for under 6% of new global daily cases versus 35-40% in June. The improving picture is encouraging but there are several challenges … Become a member to read the rest of this article Username […]
Navigating the debt legacy of the pandemic
COVID-19 has left a legacy of record-high debt and shifted the trade-offs between benefits and costs of accumulating government debt. How do these trade-offs manifest themselves? And how does the current debt boom compare with previous episodes? We argue that the debt legacy of the pandemic is exceptional by historical standards in a way that warrants prompt policy action.
The pandemic’s debt legacy
The recent fiscal deterioration in advanced economies and emerging market and developing economies (EMDEs) stands apart over the past half-century. Output collapses and government spending to keep economies afloat triggered a massive increase in global debt levels. In 2020, global government debt increased by 13 percentage points of GDP to a new record of 97 percent of GDP. In advanced economies, it was up by 16 percentage points to 120 percent of GDP and, in EMDEs, by 9 percentage points to 63 percent of GDP.
Even before the pandemic, the global economy experienced an unprecedented wave of debt accumulation that started in 2010—the largest, fastest, and most broad-based of four global debt waves since 1970. In EMDEs, the accompanying widening of fiscal deficits and the speed at which both government and private debt rose far exceeded changes in previous waves of debt.
This rapid increase in debt is a major cause for concern because of the risks associated with high debt. Previous waves of debt ended in widespread financial crises, such as the Latin American debt crises in the 1980s and the East Asian financial crisis in the late 1990s.
Trade-offs of debt accumulation
The pandemic has vividly illustrated the benefits of accumulating debt in the role of large fiscal support programs during the 2020 global recession. They were a critical policy response to avoid worse economic outcomes. They supported household incomes, kept businesses afloat, and helped stabilize financial markets.
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However, as the initial recovery from the pandemic gives way to a new normal, the balance of benefits and costs of debt accumulation is increasingly tilting toward costs. The costs of debt include interest payments, the possibility of debt distress, constraints that debt may impose on policy space and effectiveness, and the possible crowding out of private sector investment (Figure 1).
As the global economy strengthens, financial conditions are likely to tighten, whether because central banks begin to normalize monetary policy or because investors expect higher inflation. In EMDEs, this may be accompanied by depreciations that put pressure on debt sustainability in those countries with a large share of foreign currency-denominated debt. Even where foreign currency-denominated debt is limited, rising borrowing cost may erode debt sustainability, especially if growth fails to rebound strongly. Record-high EMDE debt makes countries vulnerable to financial market stress. Meanwhile, a recovery in domestic demand and closing output gaps may make additional fiscal stimulus unhelpful.
Ongoing debt booms
And many EMDEs are now particularly vulnerable to financial stress. More than two-thirds of EMDEs are currently experiencing debt booms. Their median government debt boom currently underway is similar in magnitude to, but has already lasted three years longer than, the median past debt boom (Figure 2). Current booms have been accompanied by a considerably larger fiscal deterioration than past booms (Figure 3). And booms currently underway have also been associated with slower output, investment, and consumption growth than in previous episodes.
Historically, about half of such booms in EMDEs were associated with financial crises either during the boom itself or in the two years after the end of the boom. Government debt booms associated with financial crises featured significantly weaker macroeconomic outcomes than booms without crises.
Low-income countries (LICs) are particularly at risk of debt distress, both because of high debt levels and because of a fragile composition of debt. In LICs, government debt rose by 7 percentage points, to 66 percent of GDP, in 2020. The composition of LIC debt has become increasingly non-concessional over the past decade as they have accessed capital markets and borrowed from non-Paris Club creditors. Since the end of April 2021, about one-half of LICs have been classified as being at high risk of debt distress or already in debt distress.
What to do?
National policymakers, as well as the global community, need to act urgently to address debt-related risks. Unfortunately, there is no easy policy fix that EMDE policymakers can implement to overcome these risks. For these economies, containing the potential risks associated with accumulating debt may mean resorting to alternatives for borrowing, including better spending and revenue policies, in an improved institutional environment. Spending can be shifted toward areas that lay the foundation for future growth, including education and health spending as well as climate-smart investment to strengthen economic resilience. Government revenue bases can be broadened by removing special exemptions and strengthening tax administrations. Business climates and institutions can be strengthened to support vibrant private sector growth that can yield productivity gains and expand the revenue base.
The global community can play a significant role in supporting a return to fiscal sustainability in EMDEs. In the near term, this includes supporting the vaccine rollout in these economies, where it has lagged and has weighed on the recovery. In the medium term, this includes fostering an open and rules-based trade and investment climate that has been a critical growth engine for many economies in the past. For some EMDEs, and LICs in particular, additional support may be needed to return debt to manageable levels, including debt relief.
Navigating the debt legacy of the pandemic
COVID-19 has left a legacy of record-high debt and shifted the trade-offs between benefits and costs of accumulating government debt. How do these trade-offs manifest themselves? And how does the current debt boom compare with previous episodes? We argue that the debt legacy of the pandemic is exceptional by historical standards in a way that warrants prompt policy action.
The pandemic’s debt legacy
The recent fiscal deterioration in advanced economies and emerging market and developing economies (EMDEs) stands apart over the past half-century. Output collapses and government spending to keep economies afloat triggered a massive increase in global debt levels. In 2020, global government debt increased by 13 percentage points of GDP to a new record of 97 percent of GDP. In advanced economies, it was up by 16 percentage points to 120 percent of GDP and, in EMDEs, by 9 percentage points to 63 percent of GDP.
M. Ayhan Kose
Nonresident Senior Fellow – Global Economy and Development
Franziska Ohnsorge
Manager, Prospects Group – World Bank
Naotaka Sugawara
Senior Economist, Prospects Group – World Bank
Even before the pandemic, the global economy experienced an unprecedented wave of debt accumulation that started in 2010—the largest, fastest, and most broad-based of four global debt waves since 1970. In EMDEs, the accompanying widening of fiscal deficits and the speed at which both government and private debt rose far exceeded changes in previous waves of debt.
This rapid increase in debt is a major cause for concern because of the risks associated with high debt. Previous waves of debt ended in widespread financial crises, such as the Latin American debt crises in the 1980s and the East Asian financial crisis in the late 1990s.
Trade-offs of debt accumulation
The pandemic has vividly illustrated the benefits of accumulating debt in the role of large fiscal support programs during the 2020 global recession. They were a critical policy response to avoid worse economic outcomes. They supported household incomes, kept businesses afloat, and helped stabilize financial markets.
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However, as the initial recovery from the pandemic gives way to a new normal, the balance of benefits and costs of debt accumulation is increasingly tilting toward costs. The costs of debt include interest payments, the possibility of debt distress, constraints that debt may impose on policy space and effectiveness, and the possible crowding out of private sector investment (Figure 1).
As the global economy strengthens, financial conditions are likely to tighten, whether because central banks begin to normalize monetary policy or because investors expect higher inflation. In EMDEs, this may be accompanied by depreciations that put pressure on debt sustainability in those countries with a large share of foreign currency-denominated debt. Even where foreign currency-denominated debt is limited, rising borrowing cost may erode debt sustainability, especially if growth fails to rebound strongly. Record-high EMDE debt makes countries vulnerable to financial market stress. Meanwhile, a recovery in domestic demand and closing output gaps may make additional fiscal stimulus unhelpful.
Ongoing debt booms
And many EMDEs are now particularly vulnerable to financial stress. More than two-thirds of EMDEs are currently experiencing debt booms. Their median government debt boom currently underway is similar in magnitude to, but has already lasted three years longer than, the median past debt boom (Figure 2). Current booms have been accompanied by a considerably larger fiscal deterioration than past booms (Figure 3). And booms currently underway have also been associated with slower output, investment, and consumption growth than in previous episodes.
Historically, about half of such booms in EMDEs were associated with financial crises either during the boom itself or in the two years after the end of the boom. Government debt booms associated with financial crises featured significantly weaker macroeconomic outcomes than booms without crises.
Low-income countries (LICs) are particularly at risk of debt distress, both because of high debt levels and because of a fragile composition of debt. In LICs, government debt rose by 7 percentage points, to 66 percent of GDP, in 2020. The composition of LIC debt has become increasingly non-concessional over the past decade as they have accessed capital markets and borrowed from non-Paris Club creditors. Since the end of April 2021, about one-half of LICs have been classified as being at high risk of debt distress or already in debt distress.
What to do?
National policymakers, as well as the global community, need to act urgently to address debt-related risks. Unfortunately, there is no easy policy fix that EMDE policymakers can implement to overcome these risks. For these economies, containing the potential risks associated with accumulating debt may mean resorting to alternatives for borrowing, including better spending and revenue policies, in an improved institutional environment. Spending can be shifted toward areas that lay the foundation for future growth, including education and health spending as well as climate-smart investment to strengthen economic resilience. Government revenue bases can be broadened by removing special exemptions and strengthening tax administrations. Business climates and institutions can be strengthened to support vibrant private sector growth that can yield productivity gains and expand the revenue base.
The global community can play a significant role in supporting a return to fiscal sustainability in EMDEs. In the near term, this includes supporting the vaccine rollout in these economies, where it has lagged and has weighed on the recovery. In the medium term, this includes fostering an open and rules-based trade and investment climate that has been a critical growth engine for many economies in the past. For some EMDEs, and LICs in particular, additional support may be needed to return debt to manageable levels, including debt relief.
JAPAN: TINA, turnout, and structural advantages make LDP the best electoral bet
Mistrust of the opposition, down-trending turnouts, and structural advantages in the electoral system all help make the LDP a safe bet in the 31 October general election. Opposition parties’ hopes depend on improved turnout and a coordination pact, but they don’t have stro… Become a member to read the rest of this article
Renforcer les capacités en lecture et calcul des enfants en Côte d’Ivoire
Avant même que la COVID-19 ait laissé 1,6 milliard d’élèves non scolarisés au début de 2020, des millions d’enfants et de jeunes dans le monde n’avaient pas accès à l’éducation de qualité dont ils avaient besoin pour mener une vie saine, sure et productive. Pire encore, les enfants les plus pauvres et les plus marginalisés continuent d’être les plus touchés par cette crise de l’apprentissage, perdant ainsi leur droit à l’éducation. Cette situation est lourde de conséquences pour les générations à venir, notamment en termes de pauvreté, d’inégalités, de changement climatique et de santé publique.
Il est urgent d’agir pour élargir rapidement et durablement l’accès à des possibilités d’apprentissage de qualité pour tous les enfants. Bien entendu, la question est de savoir “comment?” S’il existe de nombreuses innovations qui améliorent l’apprentissage des enfants, la grande majorité ne touche qu’une petite fraction des enfants qui en ont besoin. Par conséquent, il existe une demande croissante pour plus de probations et de conseils sur la manière d’identifier, d’adapter et d’étendre des politiques et des pratiques rentables qui aboutiraient à l’apprentissage de millions d’enfants supplémentaires.
Laboratoire de Mise à l’Echelle en Temps Réel de la Côte d’Ivoire : Accompagner les efforts pour générer des changements durables et significatifs dans l’apprentissage fondamental des enfants
En réponse, le Centre pour l’Education Universelle (CEU) de Brookings a étudié les efforts visant à mettre à l’échelle et à soutenir les initiatives fondées sur des preuves et conduisant à des améliorations à grande échelle dans l’apprentissage des enfants. Le CEU a mis en oeuvre une série de Laboratoires de Mise à l’Echelle en Temps Réel (RTSL), en partenariat avec des institutions locales dans plusieurs pays, afin de produire des preuves et de fournir des recommandations pratiques autour du processus de mise à l’échelle dans l’éducation mondiale – encourageant un lien plus fort entre la recherche et la pratique. Ce rapport porte sur l’un des laboratoires de mise à l’échelle en Côte d’Ivoire – lancé en 2019 en collaboration avec le programme Transformer l’Education dans les Communautés du Cacao (TRECC) et le Ministère de l’Education Nationale et de l’Alphabétisation (MENA).
Il est articulé autour du processus de mise en oeuvre, d’adaptation et de mise à l’échelle du Programme d’Enseignement Ciblé (PEC), dirigé par le gouvernement, à travers une approche de rattrapage scolaire visant à améliorer la lecture et le calcul en début de scolarité et adapté de l’approche Teaching at the Right Level (TaRL). Bien que le laboratoire se soit concentré sur l’expérience du PEC à ce jour, ce programme sert d’étude de cas pour des questions plus larges sur la manière dont une initiative basée sur des preuves peut progresser vers une échelle nationale durable, avec des leçons qui sont transférables au-delà du PEC et de la Côte d’Ivoire.
La première section du rapport fournit un bref historique du cas, y compris une vue d’ensemble du Laboratoire de Mise à l’Echelle en Temps Réel et de l’écosystème de l’éducation en Côte d’Ivoire, ainsi qu’une brève description des principaux acteurs et initiatives engagés dans le PEC. La deuxième section détaille le parcours de la mise en oeuvre, de l’adaptation et de l’expansion du PEC en Côte d’Ivoire à ce jour, en explorant les facteurs critiques, les opportunités et les défis liés à sa conception, sa mise en oeuvre, son financement et son environnement favorable. La troisième section propose des leçons et des recommandations ciblées organisées autour de quatre thèmes clés qui sont apparus comme essentiels pour renforcer l’expansion continue du PEC, ainsi que pour informer les futurs efforts de mise à l’échelle de l’éducation en Côte d’Ivoire et au-delà.
Le parcours de passage à l’échelle du PEC: Une confluence de facteurs avantageux
A bien des égards, le PEC représente le « scénario idéal » pour le passage à l’échelle et la pérennisation d’une initiative au sein d’un système éducatif formel. Le PEC a bénéficié d’une confluence de facteurs en sa faveur – dont certains ont été orchestrés de manière stratégique et systématique, et d’autres ont émergé de manière fortuite. L’approche de TRECC axée sur les problèmes a favorisé le développement de l’adhésion du gouvernement au PEC dès le début et a contribué à sa forte appropriation par le gouvernement. La simplicité de l’approche, le fait qu’elle rejoint les príncipes théoriques que les enseignants apprennent au cours de leur formation initiale, son pilotage par la prestation directe du gouvernement, ses résultats convaincants et sa trajectoire précise pour la mise à l’échelle dans le système éducatif ont également favorisé l’engagement du gouvernement et facilité l’expansion du PEC.
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Les partenariats noués dans le cadre du modèle TRECC ont été d’autres facteurs importants pour susciter le soutien au PEC, notamment la possibilité d’expérimenter différentes solutions potentielles avant d’en retenir une, le rôle d’une tierce partie neutre évaluant les résultats des projets pilotes, le soutien technique d’organisations ayant initialement développé et étudié l’approche TaRL, et l’existence d’un laboratoire de mise à l’échelle réunissant diverses parties prenantes pour la réflexion et l’apprentissage par les pairs. Le PEC a également réussi à obtenir un soutien de haut niveau au sein du MENA, avec des personnes influentes qui le défendent. Ce soutien essentiel a été maintenu malgré les changements politiques et les changements dans l’environnement éducatif plus large, incluant une pandémie mondiale. Enfin, la disponibilité d’un financement pour le PEC au-delà de la phase pilote initiale – y compris un financement pour une adaptation et une expansion supplémentaires et un accès potentiel à un financement quinquennal par la création d’un fonds commun public-privé – a été essentielle pour que le PEC dépasse le stade de projet éphémère et devienne une approche que le gouvernement a l’intention d’étendre au sein du système.
Néanmoins, malgré les nombreux facteurs en sa faveur, l’expansion et le maintien du PEC en Côte d’Ivoire ne sont pas garantis et des défis critiques demeurent, notamment la capacité limitée du gouvernement à incorporer et à pourvoir le modèle dans les systèmes existants avec qualité, la persistance d’une mentalité de projet chez certains acteurs clés impliqués, et une attention insuffisante à l’engagement des parties prenantes de l’éducation au niveau local (y compris les enseignants et les communautés). D’autres contraintes potentielles à l’expansion future et au maintien du PEC incluent des retards dans le lancement du nouveau fonds commun et des difficultés à identifier et à garantir un financement national durable.
Les leçons à tirer pour renforcer l’expansion du PEC et informer les futurs efforts de mise à l’échelle
En accompagnant le parcours de mise à l’échelle de PEC, des leçons ont été tirées du cas centré autour de quatre thèmes clés qui ont été déterminants pour le succès de la mise à l’échelle de PEC à ce jour, et qui continueront à jouer un rôle essentiel dans les efforts futurs. Ces thèmes sont: 1) l’institutionnalisation comme voie vers une mise à l’échelle durable; 2) les partenariats et les champions; 3) les coûts et le financement; et 4) l’adaptation et l’apprentissage continu. Chacun de ces thèmes offre des leçons tirées du cas du PEC et des recommandations ciblées, non seulement pour soutenir les progrès en cours afin d’étendre et d’approfondir l’impact du PEC, mais aussi pour informer les efforts de mise à l’échelle d’autres initiatives d’éducation basées sur des preuves. Un bref aperçu de chacune des leçons est présenté ci-dessous, avec des recommandations ciblées pour les responsables de la mise en oeuvre, les décideurs politiques, les bailleurs de fonds et les chercheurs, lesquelles sont plus amplement détaillées dans le rapport complet.
1. L’institutionnalisation comme voie à la mise à l’échelle dans l’éducation
Assurer sans relâche dès le départ une concentration sur qui va livrer à grande échelle : Le pilotage d’une initiative avec le gouvernement demande plus de temps et de capacités au départ, mais il favorise également l’adhésion, détermine ce qui est faisable et démontre le potentiel de fonctionnement d’une solution dans le système.
Se concentrer sur la scalabilitéa d’une innovation dans le contexte local : S’il est tentant de rechercher des innovations qui bouleversent considérablement les méthodes de travail existantes ou qui testent des technologies de pointe, il est essentiel de se concentrer sur l’aspect pratique de la mise à l’échelle d’une innovation dans un contexte particulier, notamment sur la meilleure façon de l’intégrer durablement et équitablement dans les systèmes existants. Souvent, les innovations ayant le plus grand potentiel d’impact à grande échelle sont celles qui sont les plus faisables à supporter par le système.
Créer des structures de coordination dotées de capacités suffisantes et d’un mandat gouvernemental fort : Le passage à l’échelle par l’institutionnalisation nécessite une structure de coordination dotée d’un mandat de haut niveau pour prendre des décisions, harmoniser les efforts et s’assurer de l’avancement du travail de mise à l’échelle – en particulier lorsque l’institutionnalisation progresse au-delà de la description de poste
d’un individu ou d’un département.
Maintenir un pied sur l’accélérateur, et l’autre sur les freins : Même avec l’adhésion substantielle du gouvernement à la mise à l’échelle, il est important que toutes les parties prenantes comprennent la nécessité d’une approche à plus long terme et progressive de la mise à l’échelle, en mettant l’accent sur les questions de qualité et d’équité, et en équilibrant les compromis inévitables au cours du processus de la mise à l’échelle.
2. Partenariats et collaboration pour la mise à l’échelle dans l’éducation
Catalyser l’action collective, et repérer le point de rendement décroissant: L’engagement du gouvernement dans le processus de mise à l’échelle peut être essentiel pour étendre et soutenir une initiative d’éducation, mais une action collective est néanmoins nécessaire pour apporter des perspectives, des ressources, des expertises et des rôles différents. En même temps, une attention suffisante doit être accordée à la clarification de la motivation et des incitations de chaque partenaire, de la valeur ajoutée, de la vision de la mise à l’échelle et du succès, et de la tolérance au risque.
Soutenir les intermédiaires pour favoriser les partenariats et aligner les intérêts: Les organisations intermédiaires ou tierces – y compris les bailleurs de fonds – peuvent jouer un rôle essentiel de passerelle pour aligner des incitations disparates, développer des approches innovantes pour tirer parti des forces et perspectives uniques de chaque acteur, et rassembler les parties prenantes pour défendre un objectif commun.
Cultiver une ligue de champions de la mise à l’échelle: La création des conditions nécessaires à la diffusion de solutions efficaces requiert des champions de la mise à l’échelle à tous les niveaux au sein et en dehors du gouvernement, des salles de classe et des communautés, ainsi que la création délibérée d’un espace pour travailler ensemble différemment – appelé à perturber les modèles existants de collaboration et de prise de
décision. Le recours à une approche d’apprentissage collaborative, telle que le Laboratoire de Mise à l’Echelle en Temps Réel, est un moyen permettant de “rassembler les éléments du système dans la réunion” et à instaurer une nouvelle façon de travailler.
Soutenir un changement d’état d’esprit et de comportement pour la mise à l’échelle: L’identification et la mise en place d’un cadre de leaders et d’agents du changement pour la mise à l’échelle ne se limite pas à obtenir le soutien des parties prenantes pour la mise à l’échelle d’une initiative particulière: elles requièrent une sensibilisation aux principes clés de la mise à l’échelle, l’encouragement de l’application de ces principes par des actions concrètes et un changement de comportement, ainsi que le renforcement des compétences et des aptitudes nécessaires à la mise à l’échelle de l’impact.
3. Coûts et financement de la mise à l’échelle
Faire la lumière sur le financement public à long terme : Pour beaucoup d’innovateurs et de praticiens, les processus budgétaires et les filières du gouvernement restent opaques, et davantage de clarté est indispensable sur la méthode d’alignement ou d’intégration dans ces processus pour mobiliser des ressources à long terme pour une échelle durable.
Augmenter le soutien pour faire des projections de coûts solides à l’échelle: Il existe un besoin important de renforcer l’expertise et les capacités locales pour collecter, analyser et utiliser les données sur les coûts afin d’informer les projections à l’échelle. Des incitations sont nécessaires pour soutenir la collecte, l’analyse et le partage de ces données, et pour encourager une plus grande transparence et des opportunités d’apprentissage.
Tirer parti du potentiel du financement commun pour franchir la “vallée de la mort”: La collaboration des donateurs et le financement groupé peuvent fournir un financement relais important pour la mise à l’échelle, en aidant les initiatives à effectuer la difficile transition du stade pilote à la mise en oeuvre à grande échelle, mais il faut en apprendre davantage sur les avantages et les défis de ces mécanismes.
4. Adaptation et apprentissage collaboratif dans le processus de mise à l’échelle
Intégrer un processus d’apprentissage continu dans les systèmes gouvernementaux: L’intégration d’une approche d’apprentissage continu, telle que le Laboratoire de Mise à l’Echelle en Temps Réel, dans les systèmes gouvernementaux présente des avantages tangibles pour soutenir la mise en oeuvre, l’adaptation et la mise à l’échelle, avec des circuits de retours d’informations rapides et des possibilités de réflexion et de corrections de trajectoire. Le leadership gouvernemental d’un processus de type laboratoire peut conférer l’autorité nécessaire pour développer, tester et affiner une stratégie de mise à l’échelle avec les décideurs concernés.
Renforcer la capacité d’adaptation pour répondre à des environnements évoluant rapidement: Trop souvent, les adaptations testées dans le cadre du processus de mise à l’échelle ne sont pas systématiquement planifiées ou bien documentées, et l’apprentissage est perdu ; des approches plus systématiques pour planifier et tirer des enseignements des changements anticipés et spontanés sont nécessaires.
Investir du temps et des ressources dans l’apprentissage et l’échange entre pairs: De nombreuses initiatives en cours de mise à l’échelle travaillent de manière isolée et, malgré les différences contextuelles, peuvent bénéficier d’une plus grande collaboration pour partager leurs expériences, réfléchir aux défis et opportunités communs et résoudre les problèmes collectivement. L’apprentissage par les pairs doit aller au-delà d’occasions ponctuelles et doit être soutenu en tant qu’un aspect intrinsèque du travail qui bénéficie de suffisamment de temps, de capacités et de ressources.
Bien qu’elle n’en soit qu’à ses premiers chapitres, l’histoire du PEC est instructive à bien des égards. Plus que tout, le récit du PEC a mis en lumière les efforts inlassables et inspirants de tant de parties prenantes de l’éducation en Côte d’Ivoire qui s’efforcent d’améliorer les résultats de l’apprentissage pour les enfants, en particulier les plus vulnérables.
Et pourtant, le cas du PEC souligne également, que même avec ce scénario de scalabilité et d’opportunité « quasi idéal », l’augmentation de l’impact sur l’éducation reste une entreprise difficile et à long terme qui ne peut être considérée comme acquise. On peut dire que le PEC entre maintenant dans son chapitre le plus difficile, à savoir la phase intermédiaire delicate de la mise à l’échelle, car il dépasse le stade d’un projet pilote à petite échelle pour s’intégrer davantage dans les opérations gouvernementales et atteindre un nombre beaucoup plus important d’enfants.
Cette phase nécessitera une adaptation et une expérimentation continues, la collecte de données et leur utilisation dans des cycles d’apprentissage rapides afin de s’assurer que l’efficacité du PEC est maintenue à mesure qu’il se développe. Indépendamment de ce que l’avenir nous réserve, les efforts du gouvernement ivoirien pour mettre à l’échelle et soutenir le PEC – en partenariat avec divers acteurs – continueront à fournir de riches enseignements sur la mise à l’échelle et le changement systémique pour la Côte d’Ivoire et de nombreux pays dans le monde.
Télécharger le rapport complet ou les conclusions sommaires.
Credit photo: TaRL Africa
Improving children’s reading and math at large scale in Côte d’Ivoire
Even before COVID-19 left as many as 1.6 billion students out of school in early 2020, millions of children and youth around the world did not have access to the quality education they needed to lead healthy, safe, and productive lives. Even worse, the poorest and most marginalized children continue to be most affected by this learning crisis, losing out on their right to education. This situation has far-reaching consequences for generations to come, including on poverty, inequality, climate change, and public health. Urgent action must be taken to rapidly and sustainably expand access to high-quality learning opportunities for all children. Of course, the question is “how?” While there exist many innovations that improve children’s learning, the vast majority only reach a small fraction of children in need. As a result, there is growing demand for more evidence and guidance on how to identify, adapt, and scale cost-effective policy and practice that lead to millions more children learning.
In response, the Center for Universal Education (CUE) at Brookings has been investigating efforts to scale and sustain evidence-based initiatives leading to large-scale improvements in children’s learning. CUE has been implementing a series of Real-time Scaling Labs (RTSL), in partnership with local institutions in several countries, to generate evidence and provide practical recommendations around the process of scaling in global education—encouraging a stronger link between research and practice.
This report focuses on one of the scaling labs in Côte d’Ivoire—launched in 2019 in collaboration with Transforming Education in Cocoa Communities (TRECC) and the Ministry of National Education and Literacy (MENA). It centers around the government-led process of implementing, adapting, and scaling the Programme d’Enseignement Ciblé (PEC), a remedial education approach to improving early grade reading and math adapted from Teaching at the Right Level (TaRL). While the lab has focused on the experience of PEC to date, it serves as a case study into larger questions of how an evidence-based initiative can achieve progress toward national sustainable scale, with lessons that are transferable beyond PEC and Côte d’Ivoire.
PEC’s scaling journey: A confluence of advantageous factors
In many ways, PEC represents the “ideal scenario” for scaling and sustaining an initiative within a formal education system. PEC benefitted from a confluence of factors in its favor—some of which have been strategically and systematically orchestrated, others which have serendipitously emerged. TRECC’s problem-driven approach supported the development of government buy-in for PEC from the beginning and contributed to strong government ownership. The simplicity of the approach, the fact that it resonates with theoretical principles that teachers learn during initial training, its pilot through direct government delivery, its convincing results, and its clear pathway for scaling in the education system also fostered government engagement and facilitated PEC’s expansion.
The story of PEC has highlighted the tireless and inspiring efforts of so many education stakeholders in Côte d’Ivoire striving to improve learning outcomes for children, especially the most vulnerable.
The partnerships forged in the TRECC model were other important factors in generating support for PEC, including the opportunity to experiment with different potential solutions before settling on one, the role of a neutral third-party assessing pilot results, technical support from organizations that originally developed and studied the TaRL approach, and the existence of a scaling lab bringing together diverse stakeholders for reflection and peer-learning. PEC has also had success in gaining senior-level support within MENA, with key influential individuals championing it. This critical support has been maintained despite political turnover and shifts in the broader education environment, including a global pandemic. Finally, the availability of financing for PEC beyond an initial pilot phase—including funding for additional adaptation and expansion and potential access to five years of financing through the creation of a public-private pooled fund—has been essential for moving PEC beyond a short-lived project to an approach that the government intends to scale within the system.
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Nonetheless, despite the many factors in its favor, scaling and sustaining PEC in Côte d’Ivoire is not guaranteed and critical challenges remain, including limited government capacity to incorporate and deliver the model in existing systems with quality, the persistence of a project mentality among some key actors involved, and insufficient attention to the engagement of education stakeholders at local levels (including teachers and communities). Other potential constraints to future expansion and sustaining of PEC include delays encumbering the launch of the new pooled fund and challenges around identifying and securing sustainable national financing.
Lessons to strengthen PEC’s expansion and inform future scaling efforts
Through accompanying the scaling journey of PEC, lessons emerged from the case centered around four key themes that were consequential to PEC’s scaling success to date, and which will continue to play a critical role in future efforts. These themes are: 1) institutionalization as a pathway to sustainable scale; 2) partnerships and champions; 3) costs and financing; and 4) adaptation and continuous learning. Each of these themes offers lessons from the case of PEC and targeted recommendations not only to support ongoing progress to expand and deepen the impact of PEC but also to inform scaling efforts of other evidence-based education initiatives. Below is a brief overview of each of the lessons with targeted recommendations for implementers, policymakers, funders, and researchers that are further detailed in the full report.
1. Institutionalization as a path to scaling in education
Ensure a relentless focus on who will deliver at large-scale from the start: Piloting an initiative with government takes more time and capacity up front, but also fosters buy-in, determines what is feasible, and demonstrates potential for a solution to work in the system.
Focus on the scalability of an innovation in the local context: While it is tempting to seek innovations that significantly disrupt existing ways of working or test cutting-edge technology, it is critical to focus on the practicality of scaling an innovation in a particular context, including how best to infuse it sustainably and equitably into existing systems. Often, the innovations with the most potential for large-scale impact are those that are most feasible for the system to bear.
Create coordinating structures with sufficient capacity and a strong government mandate: Scaling through institutionalization requires a coordinating structure with a high-level mandate to make decisions, harmonize efforts, and ensure the work of scaling moves forward—particularly once institutionalization progresses beyond any individual’s or department’s job description.
Maintain one foot on the gas, and one foot on the brakes: Even with significant government buy-in for scaling, it is important that all stakeholders understand the need for a longer-term, phased approach to scaling, with a laser focus on quality and equity issues, balancing inevitable trade-offs during the scaling process.
2. Partnerships and collaboration for scaling in education
Catalyze collective action, as well as recognize the point of diminishing returns: Government engagement in the scaling process may be critical for expanding and sustaining an education initiative, but collective action is nonetheless required to bring different perspectives, resources, expertise, and roles. At the same time, sufficient attention must be given to clarify each partner’s motivation and incentives, value addition, vision of scaling and success, and risk tolerance.
Support intermediaries to foster partnerships and align incentives: Intermediary or third-party organizations—including funders—can play a critical bridging role in scaling to align disparate incentives, develop innovative approaches to leverage the unique strengths and perspectives of each actor, and gather stakeholders together behind a shared goal.
Cultivate an alliance of scaling champions: Creating conditions for effective solutions to spread requires scaling champions at all levels within and outside government, classrooms, and communities, and deliberately creating space to work together differently—disrupting existing patterns of collaboration and decisionmaking. Leveraging a collaborative learning approach, such as the RTSL, can help to “bring the system into the room” and build a new way of working.
Support a mindset shift and behavior change for scaling: Identifying and building a cadre of scaling leaders and change agents requires more than getting these stakeholders to support scaling a particular initiative—it requires raising awareness of key scaling principles, encouraging application of these principles through concrete action and behavior change, and strengthening the competencies and skills needed to scale impact.
3. Costs and financing for scale
Shed light on long-term government financing: For many innovators and implementers, government budgetary processes and pipelines remain opaque, and more clarity is needed on how to align with or integrate into these processes to mobilize long-term resources for sustainable scale.
Increase support to make sound cost projections at scale: There is significant need to build local expertise and capacity to collect, analyze, and use cost data to inform scaling projections. Incentives are needed to support its collection, analysis, and sharing, and encourage greater transparency and opportunities for learning.
Leverage the potential of pooled financing to cross the “valley of death:” Donor collaboration and pooled funding can provide important bridge financing for scale, helping initiatives make the challenging transition from pilot to large-scale implementation, but more learning is needed on the benefits and challenges of these mechanisms.
4. Adaptation and collaborative learning in the process of scaling
Integrate a continuous learning process within government systems: There are tangible benefits to infusing a continuous learning approach, such as the RTSL, into government systems to support implementation, adaptation, and scaling, with quick feedback loops and opportunities for reflection and course corrections. Government leadership of a lab-like process can confer the necessary authority to develop, test, and refine a scaling strategy with relevant decisionmakers.
Strengthen adaptive capacity to respond to rapidly changing environments: Too often adaptations being tested in the scaling process are not systematically planned for or well documented, and the learning is lost; more systematic approaches to planning for and learning from anticipated and spontaneous changes are needed.
Invest time and resources in peer learning and exchange: Many initiatives in the process of scaling are working in isolation, and in spite of contextual differences, can benefit from greater collaboration to share experiences, reflect on common challenges and opportunities, and problem-solve collectively. Peer learning must go beyond one-off occasions and should be supported as an intrinsic aspect of the work that receives sufficient time, capacity, and resources.
Though still in its early chapters, PEC’s scaling story is instructive on many levels. More than anything, the story of PEC has highlighted the tireless and inspiring efforts of so many education stakeholders in Côte d’Ivoire striving to improve learning outcomes for children, especially the most vulnerable.
And yet the case of PEC also underscores that even with this almost “best case” scenario of scalability and opportunity, scaling impact in education remains a challenging and long-term endeavor that cannot be taken for granted. PEC is arguably now entering its most challenging chapter—navigating the tenuous middle phase of scaling—as it pushes beyond a small-scale pilot to become further embedded in government operations and reach significantly more children. This phase will require continued adaptation and experimentation, collecting data, and using them in rapid learning cycles to ensure PEC’s efficacy is sustained as it expands. Regardless of what the future holds, the Ivorian government’s efforts to scale and sustain PEC—in partnership with various actors—will continue to provide rich insights into scaling and system-wide change for Côte d’Ivoire and many countries around the world.
Read the full report or the summary findings (forthcoming).
Photo credit: TaRL Africa
Climate Change Costs Rise as Interest Rates Fall
Michael D. Bauer and Glenn D. Rudebusch
Policymakers must enable consumer data rights and protections in financial services
After years of inactivity, momentum is gathering for policy action on issues related to consumer financial data in the United States. In July, the president issued an executive order encouraging the Consumer Financial Protection Bureau (CFPB) to enable data portability in financial services. The CFPB issued an advance notice of proposed rulemaking last year and expects to commence a rulemaking process in spring 2022. Congress has shown interest in the subject as well, most recently by holding a Task Force on Financial Technology hearing on consumers’ right to access financial data.
Such momentum is long overdue. Data portability in financial services has the potential to help consumers in their choice of financial service provider and enable innovation by new entrants seeking to offer a better deal or a novel product or service. While data portability is necessary to realize a more competitive and innovative financial services sector, other consumer data rights and protections are also needed. Our research indicates that consumers are demanding greater control than the current legal and regulatory framework governing financial data provides. To be responsive to these important interests, both regulatory and legislative action is needed to ensure that consumers have appropriate data rights and protections.
Background
In the wake of the global financial crisis and the ensuing public outrage over the behavior of “too big to fail” banks, policymakers in the early 2010s found themselves looking for ways to promote competition in financial services. While many debated the merits of breaking up large banks or a new Glass-Steagall Act to separate retail and investment banking, others looked for ways to promote competition from the ground up. Around the world, policymakers began to contemplate data portability measures as a way to loosen banks’ hold on dissatisfied customers.1
In the United States, this responsibility fell to the CFPB. Under Section 1033 of the Dodd Frank Wall Street Reform and Consumer Protection Act of 2010, the CFPB was empowered to prescribe rules to enable data portability in financial services.2 However, with numerous other priorities on the CFPB’s to-do list, rulemaking on Section 1033 never took place. Instead, the CFPB issued non-binding principles for data sharing and closely monitored developments in the market.
Meanwhile, consumer demand for data portability accelerated, driven by the burgeoning fintech revolution. To meet this demand, “data aggregation” companies such as Plaid began to connect consumers’ favorite fintech apps to their bank accounts. Data aggregators often used online banking login credentials shared by consumers to gain entry to consumer accounts and “screen-scrape” data available to consumers via online banking portals. Though this practice is still in use, aggregators have more recently begun to enter into contracts with banks, credit unions, core technology providers, and others to lessen dependence on credential-sharing and screen-scraping in favor of the use of tokenized account access and application program interfaces (APIs).
The financial data sharing ecosystem largely built on this technological framework has given rise to a vibrant fintech market, including many innovative companies who use consumer financial data to design products and services that help consumers improve their financial health. Today, fintechs offer products that use consumers’ financial data to help them avoid costly overdraft fees when their balances dwindle, build emergency savings when their balances grow, and optimize their bill payments to ensure that bills are paid on time without creating a liquidity shortfall. Other fintechs use cashflow data for underwriting purposes, a practice that shows evidence of increasing access to credit among those without a credit history or a credit score and those whose credit scores understate their creditworthiness.3 Still other fintechs use financial data to enable their customers to send money to friends and family within and between countries. These services are widely used, and their popularity has only increased as more and more banking activity moved online during the COVID-19 crisis.
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In early 2021, the Financial Health Network conducted a nationally representative survey to explore consumers’ interactions with, and attitudes towards, the financial data ecosystem. According to our research, more than two thirds of banked consumers are fintech users, having linked financial apps to their checking account. In contrast with banks and credit unions,4 young people and people of color are particularly likely to use fintech apps, with apps used to send money to friends and family being the most common type of fintech app and the type of fintech app used most frequently.
The need for data portability
The lack of a comprehensive legal framework designed to govern the rights and duties of the various players in this ecosystem creates risks for individual consumers, financial institutions, and the functioning of the financial data ecosystem as a whole. Last year, the Financial Health Network partnered with FinRegLab, Flourish Ventures, and the Mitchell Sandler law firm to produce a comprehensive analysis of the legal and regulatory landscape governing consumer financial data. This analysis uncovered numerous open interpretive and policy questions related to Section 1033 as well as older statutes covering a set of interlocking issues including privacy and security under the Gramm-Leach-Bliley Act, accuracy and privacy under the Fair Credit Reporting Act, fairness under the Equal Credit Opportunity Act, and liability under the Electronic Funds Transfer Act.
Unless regulators take action, these open questions will continue to fester and have the potential to impede data portability. Already there are reports of some financial institutions restricting access to consumer data.5 Such restrictions can serve to entrench incumbent institutions and limit competition to the detriment of consumers. These restrictions also are out of step with consumer preferences. According to our research, 62 percent of consumers are in favor of data portability, believing that their bank or credit union should be required to share their personal data with another company (such as a fintech provider) if the consumer directs it to do so.
Importantly, this majority holds across demographic groups, including age, gender, education, race/ethnicity, and household income. Support for data portability in financial services is also bipartisan, with majorities of self-identified Democrats, Republicans, and Independents in favor of it.
Support for data portability holds regardless of the type of institution that serves as a consumer’s primary bank or credit union. This underscores the importance of ensuring that customers of small financial institutions with more limited technological resources have access to secure, affordable solutions to enable data portability.
These results confirm a broad consensus in favor of data portability that has been increasingly apparent for some time. Indeed, at the CFPB’s Symposium on Consumer Access to Financial Records in early 2020, few participants disputed that data portability is a right that should be available to consumers and that rulemaking on Section 1033 should guarantee.6 What they did not agree on was what other rights and protections should be guaranteed and how best to do so.
The data minimization principle
Among the issues dividing large banks, small banks, fintechs, data aggregators, and other market participants at the CFPB’s 2020 Symposium was the question of the scope. What kind of data fields should be able to be shared under Section 1033, and who should decide what kind of data are appropriate for what use case?
In the absence of regulatory guidance, the scope of data available to be shared at a consumer’s direction today varies greatly depending on where a consumer banks. Practically, this means that while some consumers currently enjoy a high degree of data portability, others have a much more limited ability to consistently share their data. As a result, consumers are unlikely to understand the scope of the data they share unless they carefully read complex legal disclosures.
The Financial Health Network asked fintech app users who had connected their fintech app to their checking account how much of their checking account data their fintech app is capable of accessing. 41 percent reported believing it could only access the data it needed, 25 percent reported believing it could access all of their checking account data, and the remaining third of respondents reported that they did not know.
When asked about how much of their checking account data fintech apps should be able to access, 87 percent reported believing that their fintech app should only be able to access the data it needs. Only 11 percent reported believing it should be able to access all the data in their checking account. In other words, consumers know what rules they want, but they are not sure if the current system is aligned with their preferences.
As with data portability, this preference for data minimization holds across demographic groups, including age, gender, education, race/ethnicity, household income, and political party affiliation. Unlike data portability, the preference for data minimization is overwhelming, with support usually in the high 80s to low 90s, with at least 75 percent of each demographic group in favor.
This indicates that while consumers desire the right to data portability, they have a strong preference for discretion as they share their data and do not wish to share any data beyond what is required for a given use case. Some data holding financial institutions (such as banks) have also emphasized this data minimization principle. However, those entities have their own competitive incentives to limit data flows and would not be impartial arbiters of what data are needed for a given use case.
With this market dynamic in mind, the CFPB should use its authority under Section 1033 to determine what data must be accessible, how often they must be made available, how long those data can be accessed for, and to whom they may be made available. If the CFPB does not feel it has the authority to impose data minimization limitations on data aggregators and recipients without impeding data portability, further legislative action may be needed to empower the Bureau to ensure that those entities are only accessing the data they need for a given use case, and are only storing that data for the minimum amount of time necessary. Congress will find strong support for this principle across the political and socio-economic spectrums.
Protecting consumers’ privacy
Consumers’ preference for discretion is not limited to the data they choose to share with fintech apps. Indeed, our research indicates that consumers are equally sensitive to financial or personal data about them being shared without their affirmative consent, no matter what institution is doing the sharing. Just as consumers do not want big tech companies sharing data about their browsing patterns without consent, consumers likewise do not want their bank or fintech app sharing financial data about them without their consent. Our survey shows consumers seem to view these forms of data sharing in much the same way, despite other research indicating that consumers have differing levels of trust for these institutions more broadly.7
Almost 90 percent of consumers (consistent among all demographic groups) expressed a preference for data sharing by their primary bank or credit union to be bound by an opt-in standard rather than an opt-out standard.
This strong preference for an opt-in standard stands in sharp contrast with current legal requirements which cannot be changed without legislative action. At present, consumers who do not want their data to be shared must opt-out, and even their ability to do that is limited. Banks are still permitted under the Gramm-Leach-Bliley Act to share consumer data with non-affiliated third parties if the information sharing is subject to one of the numerous exceptions under the law, regardless of whether a consumer might prefer them not to share.8 In other words, the current law places the burden of protecting privacy on consumers, who are expected to carefully parse complex legal disclosures provided by their financial institution and affirmatively opt-out of any optional data sharing. According to our research, only about 1 in 4 consumers reports having done this. As low as that is, it may under-state how rare it is for consumers to opt-out of data sharing. The plurality of banks interviewed in a 2020 study by the Government Accountability Office reported opt-out rates less than 5 percent.
In order to ensure that privacy protections are reflective of consumers’ preferences, we believe that legislative change is needed. The United States is past due for comprehensive data privacy legislation that not only addresses open issues in financial services but also ensures that consumers are afforded strong and consistent data rights and protections when they interact with tech platforms, healthcare providers, educational institutions, and others. However, if such a comprehensive effort remains beyond the reach of Congress, lawmakers should nevertheless build on the bipartisan consensus among consumers and past interest from both Republicans and Democrats in updating consumers’ data rights and protections in financial services. At the very least, data sharing by financial institutions should be bound by an opt-in standard.
Conclusion
As the financial data ecosystem evolves, regulatory and legislative action to ensure that consumers have strong data rights and protections is increasingly urgent. With momentum for action building and consumers having an unusual level of agreement on the need for data portability, data minimization, and data privacy, policymakers should proceed with the clear goal of ensuring that consumers are the primary beneficiary of the use of their financial data.
Inter-agency coordination bodies and the speed of prudential policy responses to the Covid-19 pandemic
by Michael Brei and Blaise GadaneczThis paper investigates whether the presence of inter-agency coordination bodies for financial stability (IABs) has been associated with faster prudential policy responses to the Covid-19 pandemic.