Philanthropy in Developing World ‘Resilient’
Thursday, 13th May 2010 at 1:47 pm
Despite the global recession, private giving and remittances are helping developing countries weather the economic storm, according to the new 2010 Index of Global Philanthropy and Remittances published by Hudson Institute’s Center for Global Prosperity (CGP).
The 2010 Index shows that U.S. philanthropy to developing countries—which includes contributions from foundations, corporations, private and voluntary organisations (PVOs), individual volunteers, religious organisations, and colleges and universities—held steady at $37.3 billion, compared to $36.9 billion in 2007.
Remittances from the United States to developing countries reached an estimated $96.8 billion in 2008, the largest U.S. outflow to developing countries. (Remittances are personal cash or in-kind transfers by overseas or migrant workers to their home countries. Remittances often far exceed aid transfers to countries and constitute a large source of revenue for many developing countries.)
Carol Adelman, director of Hudson Institute’s Center for Global Prosperity says the index documents how private resources are transforming developing countries and challenging foreign aid to be more effective and collaborative.
This marks the fifth anniversary of the Index of Global Philanthropy and Remittances.
CGP says five years ago, the foreign aid establishment downplayed the importance of private giving but now, almost every major international economic institution–from the U.S. State Department to the IMF and the World Bank–recognizes that private development aid is critical to prosperity in the developing world.
The Index covers 13 countries outside the United States: Denmark, Finland, France, Italy, Luxembourg, the Netherlands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom.
The report says the philanthropic environments of donor countries such as Australia, New Zealand and Japan are significantly ahead of China and India. The Charities Aid Foundation in Australia reports that the amount given by individual donors has increased by about 88% since 1997—12.5% on average per year. On the other hand, New Zealand’s $1.2 billion philanthropic sector receives proportionately few funds from private individuals. Only 20% of Not for Profit funding comes from direct individual donations.
Overall, CGP says the most important trends in international philanthropy outside of the United States are growth and dynamism. What have traditionally been very different philanthropic cultures are increasingly converging. This convergence is bringing more innovation in the philanthropic sector. A good example is the emergence of social stock exchanges in Brazil and South Africa. These exchanges work much like traditional for-profit capital markets to facilitate the flow of philanthropic capital, demonstrating that innovation in philanthropy is now being imported to as well as exported from the United States.
To download the Index of Global Philanthropy and Remittances go to: www.hudson.org/files/pdf_upload/Index_of_Global_Philanthropy_and_Remittances_2010.pdf