Key issues
The key issues surrounding economic development in FCAS identified through the literature and case studies are summarised below.
Conflict trap: Poor economic development processes and outcomes and conflict are mutually reinforcing. Breaking this trap presents a significant challenge, and operating within it means that donor interventions can have unintended negative consequences.
FCAS-specific implementation challenges: Specific challenges need to be addressed when planning economic development programmes in FCAS. These challenges may require the flexibility to adapt to changing circumstances, additional capacity-building efforts, and larger budgets and longer time-frames.
Trade-offs: Difficult trade-offs must often be made as the aims of inclusive and transformational economic growth and state-and-peacebuilding are not necessarily mutually reinforcing.
Inclusion: Inclusion and sensitivity to the needs of populations across gender, ethnic, regional, income and other groups is crucial for growth strategies and peacebuilding.
Resource paradox: Natural resources can be a blessing and a curse, with continuing challenges in how to channel the funds they generate, in a way that supports inclusive and transformational growth and well as statebuilding and peacebuilding.
Lack of evidence: Much of the literature guiding economic development interventions in FCAS lacks robust evidence of impact, specifically on wider statebuilding and peacebuilding objectives. This leads to a lack of evidence-based policy.
Failure to include wider objectives in programme design: Economic interventions in FCAS often fail to adequately and explicitly incorporate conflict sensitivity, and statebuilding and peacebuilding objectives, into programme design and frameworks for monitoring and evaluation.
Difficulty measuring impact: The time involved in economic development programming and the changing dynamics of conflict makes it difficult to see whether donor interventions contribute to growth, poverty-reduction, peacebuilding and statebuilding, particularly in the short-term.
Lessons
Five lessons have emerged from the key issues outlined above.
Lesson 1: It is important for economic development interventions to incorporate conflict-sensitivity into programme design, implementation and evaluation.
Economic development interventions risk exacerbating conflict if conflict dynamics are not overtly addressed through political economy and conflict analysis (Alinovi et al. 2007). Environments with valuable natural resources are particularly prone to some of these risks. Therefore, interventions need to be context-specific, addressing the local political economy and conflict dynamics (UNDP 2008; World Bank 2011). Programming needs to incorporate these issues so that its implementation can anticipate and minimise any potential negative consequences (USAID 2009). Conflict sensitivity can be monitored and evaluated; a range of tools exist for this purpose (see Goldwyn and Chigas 2013). See also GSDRC Conflict Sensitivity Topic Guide for tools and approaches to apply conflict sensitivity to interventions.
Lesson 2: Trade-offs between inclusive growth, transformational growth, peacebuilding and statebuilding need to be understood and considered in programme design and implementation.
Inclusive growth, transformational growth, peacebuilding and statebuilding objectives are not always mutually reinforcing, which requires prioritisation and trade-offs. Trade-offs that arise include prioritising the: urgent vs. legitimate; effective vs. efficient, short-term vs. long-term; and window of opportunity vs. absorptive capacity (USAID 2009). In situations where all programming and reforms are important but capacity and resources are low, interventions require prioritisation and sequencing (Herbert 2014). A key difference between economic development in FCAS and economic development elsewhere lies in these trade-offs.
Lesson 3: Attention to gender and horizontal group disparities.
The early stages of statebuilding do not prioritise gender equality, and increasing women’s voice, in political, social, and economic development. Issues related to gender relations, women’s rights, participation and relationship to the state are often overlooked or inadequately addressed when designing interventions (Kangas et al. 2014).
Lesson 4: Stronger evidence of what works for economic programming in FCAS is needed.
The relationship between conflict and growth remains uncertain, lacking nuance and specificity (Mallett and Slater 2012). The majority of programmatic evidence suffers from unclear empirical foundations. Very few case studies, including those reviewed in this Topic Guide, provide robust impact assessments, particularly of long term aggregate-level impact. A consistent criticism is that there is very little robust evidence on the impact of interventions. Furthermore, many evaluations emphasise results against outputs rather than impacts on intended beneficiaries see, for example(Sinha et al. 2012), or focus on economic impacts without considering other objectives such as peacebuilding and statebuilding or conflict-sensitivity (see Box 1).
Lesson 5: Economic interventions in FCAS should incorporate statebuilding and peacebuilding objectives in programme design and monitoring and evaluation frameworks.
Incorporating wider objectives into programme design and monitoring and evaluation frameworks should both bring greater focus towards achieving these objectives, but also help to fill the evidence gap identified above, ultimately leading to improved interventions and evidence. A number of resources exist to help achieve this aim.
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