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In answer to the call expressed within the Addis Ababa Action Agenda to mobilise all available resources – domestic and foreign, public and private – in support of the Sustainable Development Goals, the Development Co-operation Directorate develops a new work stream on transition finance to explore the evolution and interaction of public (official development assistance and other official flows) and private (foreign direct investments and remittances) sources of finance across the development continuum – studying multiple stages of development: low income countries, middle income countries, fragile contexts, and different regions of the world. Its ultimate objective is to advise the Development Assistance Committee (DAC) in preparing countries for transition (outlining the optimal financial mix and offering policy recommendations) and in building resilience.

This paper introduces the concept of transition finance and initiates research to advise the DAC on its role as a major provider of development assistance among other public and private providers of financing for the 2030 Agenda.

The Zambia country pilot study was conducted by the OECD Development Assistance Committee (DAC) to explore the challenges of transition finance for a commodity-based Least Developed Country (LDC). In particular, debt sustainability concerns are viewed within the context of the shifting financing for sustainable development landscape of Zambia following its re-classification to Lower Middle Income Category (LMIC).

In line with the Addis Ababa Action Agenda (AAAA), the pilot study proposes a new “ABC” approach targeted to assess all available sources of financing (official development finance, private investment, domestic resources, and remittances), identify emerging SDG financing gaps and promote better alignment of resources with national financing for sustainable development strategies.

Building on the evidence collected through seven country pilots, this Transition Finance Compendium concludes that more could be done to build the resilience of ODA. The analyses carried out suggests that official development assistance (ODA) trends should not be observed in isolation of other sources of financing for sustainable development since transition finance is about the progressive substitution of external financing by domestic public resources and private investment mobilised. It finds that further planning and co-ordination of DAC members’ exit and phasing-out strategies or decisions could generate ODA efficiency gains and resilience; that the increasing complexity of the financing for sustainable development (FSD) landscape creates not only opportunities for access to additional sources of financing, but also risks; and concludes on emerging recommendations for the DAC to better prepare transition, e.g. good practices/relevant standards and tools for transition finance. It ends suggesting how the DAC can move from transition finance diagnostics to implementation.

Based on the “ABC” approach targeted to assess all available sources of financing (official development finance, private investment, domestic resources, and remittances), the Viet Nam country pilot study explores the challenges of transition finance in a middle-income country in the Asia-Pacific region. After launching a series of successful reforms beginning in the late 1980s, Viet Nam has undergone an impressive transformation, which turned the country from a centrally planned to a market-oriented economy and from a low-income to a lower middle-income country. At the same time, Viet Nam is moving from a relatively high reliance on ODA and other external sources towards non-concessional sources and domestic sources. Through evolving partnerships, development partners can align their support with newly arising needs, actively supporting Viet Nam overcome the middle-income trap and move towards a trajectory for more sustainable development.

Transition finance offers a flexible approach for development partners to respond to the changing financial needs of developing countries undergoing transition. The transition finance ABC methodology, part of the transition finance toolkit, provides methodological guidance, metrics, data references and analytical interpretation for users to conduct transition finance diagnostics and country studies.

The paper is organised along the sections: assessing, benchmarking and counselling. The first section, assessment, outlines an economic and socio-political mapping of the country and helps to identify the specific transition a country is undergoing. Benchmarking, section two, helps to form country peer groups and contrast development finance to these countries. Building on the analytical results from the first two sections, the last section on counselling gives exemplary policy guidance to respond to the observed transition challenges.

Through the ABC framework developed under the OECD’s transition finance work stream, the present country pilot strives to shed light on Chile’s official development assistance graduation experience. Its main objective is to understand the challenges related to this graduation, analyse the measures (positive or otherwise) taken prior to this transition stage, and learn from the Chilean experience to identify and react to the transition challenges faced by recent and future ODA graduates. The policy recommendations and conclusions proposed in this report aim to help development partners better approach graduation under similar conditions, i.e. in countries approaching graduation from ODA.

This study investigates transition finance in Lebanon, an upper middle-income country in the MENA region transitioning from a significant adverse shock. Lebanon’s development path has been historically non-linear and, most recently, the Syrian conflict adversely affected the country’s development path. The Syrian conflict compounded pre-existing deficits and challenges in Lebanon, calling for increased international assistance.

DAC donors increased official development assistance (ODA) to Lebanon to preserve stability and promote refugee protection. Donors also created special financing instruments such as the Global Concessional Financing Facility (GCFF) to foster the provision of multilateral concessional financing to Lebanon. Official development finance in Lebanon is high in comparison to its peers, particularly on a per capita basis and for humanitarian assistance. The country also attracts high amounts of FDI and remittances. Overall, domestic credit dominates the financing landscape and public debt is high.

DAC members and other donors can strengthen the humanitarian-development-peace nexus, address long-standing country needs to promote self-sufficiency, and re-design partnerships driven by mutual accountability and appropriate incentive structures.

With only a decade left to reduce emissions drastically, the scale, pace and extent of global transformation needed is truly demanding. Long-term emission goals and the nature of the low-emission transition in each country will be a function of its unique socio-economic priorities, capabilities, resource endowment, vision for post 2050 economic structure, and social and political acceptability of what constitutes a just transition. As we enter the “decade for delivery”, a whole of economy approach is needed to realise the low-emission transition. This includes focusing not only on upscaling zero and near-zero emitting technologies and businesses but also supporting, to the extent possible, the progressive lowering of emissions in high emitting and hard to abate sectors. In this context, “transition finance” is gaining traction among governments and market participants. To identify the core features of transition finance, this paper reviews 12 transition relevant taxonomies, guidance and principles by public (Japan, Singapore, Malaysia, Russia, European Union, EBRD) and private actors (Climate Bonds Initiative, International Capital Markets Association, Research Institute for Environmental Finance Japan, AXA Investment Managers and DBS), as well as 39 transition relevant financial instruments (vanilla transition bonds, key performance indicator-linked fixed income securities). This paper does not aim to define transition finance, but rather to review emerging approaches and instruments to highlight commonalities, divergences as well as issues to consider for coherent market development and progress towards global environmental objectives. Based on the review, this paper puts forth two preliminary views. First, that the essence of transition finance is triggering entity-wide change to reduce exposure to transition risk; second, that transition finance may be better understood as capital market instruments with a set of core functions/attributes rather than a specific format or label.

The transition from school to work can be a difficult period associated with spells of unemployment. Data show that those who leave school early have comparatively low skills and low educational attainment and face the greatest challenges in the labour market compared to their peers who stayed in education longer. Efforts should be made to ensure that people remain in education until they complete at least upper secondary education – considered the minimum threshold for successful entry into the labour market. Remaining in education not only leads to higher educational attainment, but also fosters the skills needed to ensure a successful transition into the labour market.

French

This report examines how cities can manage the transition to shared mobility services. It expands on two earlier studies that looked at the citywide impact of replacing private cars with shared services, but did not address the question of implementation. Based again on mobility data for the city of Lisbon, Portugal, this report assesses issues around the scaling up of shared mobility services to the whole of the Metropolitan area and of their stepwise introduction. It also analyses the impacts of these services on the use of existing high-capacity public transport and on access to jobs, schools or health facilities across the whole study area, and explores how shared mobility can improve accessibility for users with impairments.

The work for this report was carried out in the context of a project initiated and funded by the International Transport Forum's Corporate Partnership Board (CPB). CPB projects are designed to enrich policy discussion with a business perspective. Led by the ITF, work is carried out in a collaborative fashion in working groups consisting of CPB member companies, external experts and ITF staff.

Globalisation has brought benefits to the economies in the Black Sea Economic Co-operation (BSEC) and Central Asia (CA), but compounded volatility and uncertainty associated with the transition to market economy. Labour markets have been put under pressure, as BSEC-CA countries compete on the international arena. One important form of labour market adjustment has been a large amount of migration flows within the BSEC-CA region and to the neighbouring countries.
French

In recent years, considerable analytical work has been done on issues of economic reform in countries undertaking adjustment. Less attention has been devoted to the social costs of adjustment and the transitional problems during the period from reform to growth. The Egyptian economic adjustment since 1991 is a good case in point, as Egypt is facing difficult transitional problems, of both social and financial nature.

The first part of this paper discusses Egypt's newly established social fund (1991), notably the adequacy of its core programmes and targeting mechanism for providing an appropriate "social safety net" in the medium term. The second part of the paper deals with Egypt's financial intermediation system, which is unable to convert large amounts of liquid savings into long-term real capital, hence increasing the time-lag between reform and growth.

It is concluded that an efficient system of financial intermediation and a comprehensive social safety net are needed to ...

A changing climate is threatening livelihoods and economic activity in Greece and the world. Transitioning to a green economy – mitigating the causes of climate change and adapting to its effects, while sustaining activity and improving well-being – is among the greatest policy challenges of the coming decades. In Greece, legacies of high emission intensity, limited fiscal space and scarce private financing amplify the challenge. Greening Greece’s energy system is at the core of this transition. This entails swiftly developing its large potential for renewable energies and adapting energy consuming sectors. A well-chosen mix of policies – including carbon pricing, public infrastructure investments, and gradually tightening regulations on minimum energy efficiency standards, while providing financial support and protecting vulnerable households – would minimise the cost of this transition. Developing insurance coverage can better protect households and firms from damages resulting from a warming climate, while limiting fiscal exposure. Engaging all stakeholders and supporting those affected by the transition will help build the consensus for implementing these policies into the long-term.

Young people have been hit hard by unemployment during the Irish recession. While much research has been undertaken to study the effects of the recession on overall labour market dynamics, little is known about the specific effects on youth unemployment and the associated challenges. This paper attempts to fill this gap by comparing the profile of transitions to work before the recession (2006) and as the economy emerged from the recession (2011). The results indicate that the rate of transition of the youth from unemployment to employment fell dramatically. The fall is not due to changes in the composition or the characteristics of the unemployed group but to changes in the external environment, which implied that the impact of certain individual characteristics changed over the course of the recession. In particular, for youth, education and nationality have become more important for finding a job in Ireland.

Using panel data for Indonesia, Malawi, Peru and South Africa, this paper investigates the relationship between transitions to formal employment and workers’ labour income. It shows that transiting from informal to formal employment increases the probability of improving workers’ labour income in both absolute and relative terms. However, income gains from formalisation do not accrue to all workers equally. Switching to formal employment has the greatest potential to improve the labour income of the richest workers. The chances of improving the labour income of the poorest workers through formalisation are slim. Transitions between formal and informal employment affect income gains and losses differently for men and women, older and younger workers, and workers with different levels of schooling. The effects of labour market transitions on income changes are considerably greater in magnitude than other life events such as a births, separation, or death of a partner or spouse.

This paper explores modalities, enablers, and political moments that could help to translate the outputs of the global stocktake (GST) into an outcome that informs and enhances national and international actions as intended in the Paris Agreement. How to move from the collective outputs of the GST to desired outcomes is critical but not straightforward. Drawing on lessons learnt from previous international assessment and review processes under the UNFCCC and beyond, this paper sets out insights on modalities, outputs and enabling factors that could help ensure the GST leads to action on the ground. The paper concludes that achieving the outcomes of the GST requires a well-designed process that effectively engages Parties and non-Party stakeholders in separate but sequenced technical and political discussion tracks. The paper also finds that specific, actionable outputs that target different actors can facilitate subsequent follow-up. The paper identifies different enabling factors that could support the translation of GST outputs formulated at the collective level into national processes to update and enhance actions and support. It also highlights the importance of leveraging different political moments and building linkages with parallel processes, both within and outside the UNFCCC context, to maintain momentum on the GST and ensure operational action follows over time so that collective efforts are in line with the long-term goals of the Paris Agreement.

The international instruments of the Teaching and Learning International Survey (TALIS) require national adaptations and translation before data collection processes begin. This paper provides an assessment of the processes used in TALIS 2018, based on an analysis of the documentation available, as well as countries’ descriptions of the processes and challenges undergone during that cycle. The author starts by identifying several positive aspects, highlighting the work of the international contractor, the national centres and national project managers but also suggests areas for improvement. Finally, the paper looks at the new translatability assessment in the current cycle (TALIS 2024) and how it could be even more effective, as well as recommending a series of proposals that could support adaptation and translation processes in future cycles.

The emergence of a resistant pathogen reduces the effectiveness of antibiotics in preventing or treating an infection caused by a micro-organism, thus increasing morbidity and mortality and leading to higher economic costs to livestock producers. An understanding of the underlying disease dynamics is crucial in finding appropriate solutions to containing the rise in antimicrobial resistance. This report synthesises the evidence on the potential modes of transmission of antimicrobial resistance between humans and animals and vice versa. In particular, the important role of the environment in the transmission chain is discussed as well as practices to break this link. This report also illustrates some of the commonly shared antibiotic classes that are used in human medicine and animal production, and the overall trends in the usage of these antibiotics. While information on transmission of resistance is sparse, the report highlights several priority areas where future research could focus in order to bring a greater understanding of these interactions.

Transnational organised crime (TOC) refers to a fluid and diversified industry that engages in illicit activities ranging from drug and human trafficking to drug smuggling, piracy and money laundering. Although it may affect strong states, conflict-affected and fragile states are especially vulnerable to the dynamics of TOC and may provide more favourable conditions for its development. The implications for those states are many and serious. This paper outlines the ways in which TOC has evolved in recent years and how policy might be adapted to take account of this evolution. It emphasises that TOC today is less a matter of organised cartels established in producer or end-user states, but increasingly characterised by fluid, opportunistic networks that may for example specialise in transport and logistics. The paper recommends tackling the problem through a comprehensive approach that considers TOC as but one element within a greater complex of cause and effect. This would entail a re-evaluation of many current assumptions about TOC and a reformulation of current policies.
Lack of regulatory transparency is a major and recurrent obstacle for businesses seeking to trade internationally. This study finds that transparency mechanisms applied at different stages of the design, finalisation and implementation of domestic regulation have allowed countries to reduce administrative burdens, generate savings both for the administration and for the private sector and maintain a relation of confidence conducive to a smoother enforcement of related policies. They have also helped them enhance the readability of laws and regulations and the predictability of their enforcement (thus further reducing indirect business costs), and prevent potential frictions with trading partners. The resulting improvements in terms of potential business costs can strongly influence the attractiveness of the country for foreign investors.
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