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Economic Brief - Is there a Case for Reforming the Country Policy and Institutional Assessment (CPIA) as an Aid Allocation Tool?
The way countries finance their development has been a matter of debate for a very long time. This debate seeks to curve out socio-economic and political spaces for policy development. In Sub-Saharan Africa (SSA), the World Bank and the African Development Bank (AfDB), which are the major players in multilateral aid, have been re-defining aid conditionality since the early 1980s. There has been a move away from emphasis on structural adjustment where finance was provided in return for the promise of policy reforms to disbursement of funds conditional on the actual reforms that a country has achieved. The new practice is known as aid ‘selectivity’ or performance-based aid premised on the CPIA (Kararach, et al. 2012). Some commentators have even urged for the abolition of the CPIA tool altogether (Alexander, 2010).