Machine Learning in Uganda Brings the Power of Risk Financing to Strengthen Refugee and Host Community Resilience

Uganda

Sub-Saharan Africa

26 January 2021

“We have to recognize that there cannot be relationships unless there is commitment, unless there is loyalty, unless there is love, patience, persistence.”

This statement, by Professor Cornell West, drives a more difficult question: how do we measure and support ‘commitment’ between social groups so that a relationship’s loyalty, love, patience, and persistence is fostered?

In conflict-affected and fragile settings, the fostering of inter-group relationships, particularly those between refugee and host communities, is critical to the prevention of violent conflict. The cost of responding to violent conflict rather than preventing it is staggering. A recent joint United Nations-World Bank study found that a prevention approach in just five countries would save approximately $34 billion in lost gross domestic product per year. With the increased economic vulnerability of many countries due to the impacts COVID-19, preventing violent conflict, and its costs, is now more important than ever.

Beyond the financial cost, violent conflict threatens the World Bank’s Twin Goals of ending extreme poverty and promoting shared prosperity, by forcibly displacing people from their homes creating refugees and internally displaced persons (IDPs). Global forced displacement, which surpassed 80 million at mid-2020, is now occurring at levels not seen since the Second World War.

A critical challenge of forced displacement is the management of pressures on local host communities so that relationships with refugees are strong. There is global consensus that host communities often face enormous pressures particularly in relation to access to public services that increases their vulnerability. This can be a key driver/contributor to the outbreak of violent conflict. Therefore, to work towards achieving the $34 billion of savings per year, it is critical for both refugee and host communities, as particularly for the ‘commitment’ of the relationship between them, that public services are supported during a displacement shock. A commitment to adequate public service access informs part of a commitment necessary for the loyalty, love, patience, and persistence described by Professor West that fosters social cohesion and peaceful co-existence.

In Uganda, the World Bank’s community-driven development approach, via the Development Response to Displacement Impacts Project (DRDIP), shifts the paradigm of displacement response through the provision of critical public services in refugee-hosting communities . Under DRDIP, a new approach is supporting the government’s response to future displacement shocks: the Displacement Crisis Response Mechanism (DCRM – information leaflet here).

The DCRM is the Government of Uganda’s response to demands for innovative and government-led development finance that sees refugees as a development opportunity. The DCRM’s objective is to foster inclusion and cohesion within and between refugee and host communities by monitoring and maintaining key public service levels for both groups.

In Uganda, the DCRM supports rapid scale-up of public service provision in locations impacted by a refugee-related displacement shock. The DCRM is part of the WBG’s broader support to Uganda’s progressive approach to hosting the fourth highest number of refugees in the world and the largest in Africa.

The DCRM is based on the best practice principles of crisis and disaster risk financing. It is a pre-planned and pre-financed mechanism for shock response. The pre-planning consists of three key factors: First, the process of disbursing resources from the DCRM is agreed in advance. The government selects indicators of public service provision that will be monitored over time. If the indicators drop below threshold levels, the DCRM rapidly and automatically disburses resources. Secondly, the public service investments to be made with DCRM resources are pre-agreed, and include the development of school, water and health care facilities. Finally, it is pre-financed with $4.5 million held in the DRDIP project allocated to make these investments. This pro-active, pre-planned approach represents a sea change from the status quo.

Clearly, the development impact of the DCRM will be driven by the accuracy and efficacy of the indicators the Ugandan government collects to monitor levels of public service provision. Accuracy is important precisely because exclusion of host and refugee communities from public services constitutes one sphere of multidimensional risk of violence driven by a range of complex and interrelated factors. With this in mind, the World Bank is supporting the Government of Uganda to adopt a variety of information gathering methods including perception surveys, civil society analysis, as well as the latest in innovation for data gathering and analytics. This may include use of artificial intelligence to interpret sentiment in public discourse before, during, and after displacement shocks.

Monitoring access to services and equitably and rapidly responding to pressure placed on them by displacement is a new concept for development finance but goes to the heart of ‘commitment’ envisaged in a healthy relationship between social groups. As part of the design, we have consulted colleagues in the field, government, and leading authorities on what best represents ‘need’, and what methods are optimal for measuring ‘need’ in data-scarce and fluid environments accompanying displacement. That said, we acknowledge the first iteration of DCRM implementation will require honing and adaptation. Consequently, the government, with support from the World Bank are adopting a careful, empirically informed ‘learning by doing’ approach.

Multiple low- and middle-income countries are facing increased risk of multiple and potentially simultaneous shocks that can mobilize group-specific grievances to violence. However, by considering the latest data modeling and artificial intelligence techniques, the DRCM seeks to develop a new approach to financing and implementing responses to displacement shocks. Fostering inclusive access to services when displacement shocks occur, constitutes a new and inclusive approach when and where it’s most needed: in support of Africa’s ‘example of solidarity’ with refugee communities.

Photo Credit: Dorte Verner

You can find the original World Bank Group blog here.

Relevant Reading: Data-Driven Development Response to Displacement Crisis in Uganda: The Displacement Crisis Response Mechanism

Chris Mahony

Lawyer and Political Scientist

Chris Mahony is a lawyer and a political scientist.

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He is co-founder and CEO of Peloria, a public benefit company that uses social science-informed data science to forecast, explain, and advise on change in social phenomena. He also works with multiple World Bank practices, including Finance, Competitiveness, and Innovation; Social Development; Macroeconomics, Trade and Investment; Fragility Conflict and Violence; and Poverty and Equity, advising on the utility for development policy and operations of emergent data sources and methods.

During his 20-year career, he has worked in the World Bank's Finance Competitiveness and Innovation Global Practice on social risk finance, developing the world's first human displacement risk financing mechanism. He also evaluated country engagement strategy, development policy operations practice, and governance projects in the Independent Evaluation Group and worked on criminal justice and citizen security policy in the Governance Global Practice.

Dr. Mahony also worked for the United Nations Development Programme (UNDP) on Strategic Policy and Rule of Law, including as Global Focal Point on Transitional Justice and as faculty and founding Deputy Director of the New Zealand Centre for Human Rights at Auckland University Law School. He has taught Law and International Relations at Peking University, Oxford University, and Auckland University. In 2008, he directed the design of Sierra Leone’s domestic witness protection program.

He was admitted to the High Court of New Zealand bar in 2006, where he appeared for the Crown in criminal and refugee matters. In 2003, he worked in Sierra Leone and Liberia, where, among other work, he drafted the Sierra Leone Truth and Reconciliation Commission’s recommendations on governance and corruption and its ‘Historical antecedents to the conflict’ chapter.

Dr. Mahony holds a Bachelor of Commerce (B.Com) degree and a Bachelor of Laws (LL.B.) from the University of Otago, as well as a Master’s in African Studies (M.Sc.) and a D.Phil. in Political Science from the University of Oxford. While studying, he played rugby professionally in New Zealand and the UK, including for the Auckland NPC side (winning the 2007 NPC). He won four rugby Blues for Oxford University. Chris has authored, co-authored and co-edited 26 peer reviewed publications including four books across the disciplines of Law, International Relations, Refugee Studies, Development Economics, and Psychology.

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Co-Authors

Barry Maher

Bio :

Barry is a senior financial sector specialist working in the Finance, Competitiveness, and Innovation (FCI) Global Practice based in Pretoria, South Africa where he coordinates the work of the Worl

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d Bank on Crisis and Disaster Risk Financing in the Africa region. Barry is a qualified actuary with experience in the non-life insurance sector, the carbon and renewable energy markets, financial inclusion, social protection, the MSME sector, and disaster risk financing. His career includes experience working with a Lloyds of London reinsurance syndicate, as a chief actuary in an insurance agency, and with the UN where he led the expansion of micro-insurance in the Pacific. Since joining the World Bank, Barry has led the work on developing public-private sector partnerships to support agriculture insurance in Kenya, Bangladesh, Uganda, Rwanda, South Africa and India. He spearheaded the work on developing financing strategies to support shock-responsive safety nets, which has now grown into a global portfolio in Africa, Asia and the Pacific. He also provided technical support to actuarial work of Crisis and Disaster Risk Finance Global Team of the World Bank, including the financial modeling of the Pacific Catastrophe Risk Assessment and Financing Initiative, which provides Pacific Islands with insurance protection against tropical cyclone and earthquake events. More recently in the Africa region, Barry has been expanding the use of risk financing tools and principles in FCI and more broadly the Equitable Growth, Finance and Institutions Vice Presidency unit of the World Bank. As countries emerge from the health and fiscal impacts of the Covid-19 pandemic, Barry is focusing on strengthening the resilience of key sectors for economic growth and job creation to shocks, including in particular MSMEs.

Barry holds a Bachelor’s Degree in Actuarial and Financial Studies from the University College of Dublin and a Masters in Statistics from the University of Oxford, both with distinction.

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Zewditu Haile

Bio :

Zewditu Haile is a consultant with the World Bank currently working on Uganda and South Sudan.

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She is an African feminist lawyer with extensive experience working in Fragile, Conflict, and Violence (FCV) affected contexts in the non-profit, humanitarian, and development sector with a focus on forced displacement, refugee protection, human rights and atrocity prevention. Zewditu holds a Master of Laws (LL.M) degree in International Law from the University of Groningen (the Netherlands).

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