Policy paper

UK–Middle East and North Africa region development partnership summary, July 2023

Published 17 July 2023

Introduction

The Strategy for International Development (IDS) places development at the heart of the UK’s foreign policy. It sets out a new approach to development, anchored in patient, long-term partnerships tailored to the needs of the countries we work with, built on mutual accountability and transparency. This approach goes beyond aid and brings the combined power of the UK’s global economic, scientific, security and diplomatic strengths to our development partnerships. Our 4 priorities are to deliver honest, reliable investment, provide women and girls with the freedom they need to succeed, step up our life-saving humanitarian work, and take forward our work on climate change, nature and global health. The Integrated Review Refresh (IR23) reiterates that sustainable development is central to UK foreign policy and sets out how the UK will go further and faster on development to reduce poverty and reinvigorate progress towards the SDGs (Sustainable Development Goals). This Country Development Partnership Summary details how the IDS and IR23 will be put into practice with Middle East and North Arica Directorate (MENAD).

Regional context of the Middle East and North Africa (MENA) region

The MENA region is fragile, volatile and geopolitically significant. The last decade has seen a marked increase in conflict, instability and unrest. MENA has three of the world’s most intractable conflicts (Yemen, Syria, Libya) with other countries at high risk of instability, for example Iraq and Lebanon. The region is home to some of the world’s worst humanitarian crisis, which have displaced millions and caused a protracted regional refugee crisis. The region is not uniform and includes Gulf oil producers, important donors in their own right, as well as countries in need of economic reform and conflict-affected states where poverty and human development indicators are amongst the lowest in the world.

There are a range of challenges. There is significant and entrenched gender inequality. There is a burgeoning young population in need of education and jobs. Three quarters of the countries in the region are classed as “Not free” by the Global Freedom Index. The region is particularly vulnerable to climate change, with water scarcity a defining climate and environmental challenge.

Intractable regional issues

Now in its second decade, the conflict in Syria and resulting refugee crisis is protracted in nature, with 5.6 million refugees being hosted by neighbouring countries, primarily in Jordan, Lebanon and Turkey. An inclusive political settlement is highly unlikely within the foreseeable future, limiting the prospect of safe returns for Syrian refugees. Meanwhile, the challenges for refugees and their hosts intensify, further exacerbated by the consequences of the invasion of Ukraine, inflation and rising food costs.

Key partnerships

The MENA Directorate supports and enhances UK strategic economic, defence, security and development partnerships in the MENA region. The Directorate builds and maintains these strong relationships with our development partners, including governments in the region, the UN, other donors and the International Financial Institutions (IFIs).

The Gulf Cooperation Council (GCC) countries are the UK’s fourth largest export market and wield significant investment capacity. They are also significant donors in their own right. MENA Directorate works to strengthen our development and technical engagement with Gulf partners to support shared priorities in the region and further afield, for example the Horn of Africa, particularly on food security, clean energy, agriculture, water and climate science innovations.

COP, climate and energy

The MENA region is highly vulnerable to rising temperatures, sea levels, droughts and floods. It is also critical to reducing global emissions and energy security. Water scarcity, together with agro-ecological conditions and destroyed production capacity in conflict-afflicted states, is a driver of high reliance on food imports. Energy security remains an issue, particularly in the context of Russia/Ukraine, including countries’ ability to meet short to medium term domestic and global energy demands; and the economic diversification and reforms necessary over the longer term.

MENA Directorate leads on our climate policy and approach in the region, which includes the £60 million ‘Pioneering a Holistic approach to Energy and Nature-based Options in MENA for Long-term stability regional climate programme’ (PHENOMENAL), focused on supporting energy transition, showcasing UK green innovation and expertise, while helping vulnerable communities cope with climate shocks and food and water security.

Gender

Despite significant improvements over recent years, MENA remains the region with the widest gender gap in the world, with a lack of economic opportunity and political empowerment remaining significant obstacles to achieving gender equality. On its current trajectory, it will take over 140 years for MENA countries to reach equality between men and women.

MENA Directorate drives a more conscious and consistent approach to tackle gender inequality across MENA, including supporting gender leads at Post, working with the MENA Gender Network and exploring options for new programming.

Food insecurity

MENA is one of the regions most impacted by global food insecurity following Russia’s invasion of Ukraine. In MENA, wheat from Russia and Ukraine represents more than half of that imported into the region (30% and 23% respectively). The World Food Programme sources 50% of its humanitarian response stocks from Russia. Across the region domestic prices have already started absorbing the shock and inflation has grown substantially.

The MENA Directorate monitors domestic food prices to understand how inflation is impacting the region, ensuring the links between food security, sustainable agriculture and climate objectives are acknowledged; working with Posts, other donors and multilaterals to focus on priorities.

Why and how: the UK’s development offer

The UK’s development objectives for the MENA region align with the Integrated Review and focus on economic, defence and security partnerships alongside building resilience, through regional engagement and programming. In support of this, MENA Directorate plays a convening role to support geographic Posts, central FCDO thematic teams with equities in the region and other government departments.

The MENA Directorate’s goals are also closely aligned to the International Development Strategy, with an emphasis on UK economic support, support for women and girls, humanitarian assistance and climate change. In addition, our goals include policy work on shared security, comprising support for tackling irregular migration; peacebuilding, conflict, and instability.

Through senior officials and Ministers, the MENA Directorate manages key relationships with partners, such as NATO and Five Eyes, to strengthen our security partnerships in the region. This collaboration enables us to better comprehend and counter, state threats, reducing risks to the UK from transnational threats and enhancing regional security.

The MENA Directorate leads and supports Posts in leveraging UK convening power to strengthen relationships across the region to help initiatives that increase regional economic integration, achieving UK economic wins; and engaging our partners to provide development finance for clean, sustainable infrastructure and economic growth. The Directorate also liaises with central teams on engagement with International Financial Institutions (IFIs), such as the World Bank, to work through reforms for fiscal and economic sustainability in support of these goals.

The MENA Directorate works closely with central teams and Posts to ensure the UK remains a major partner for the UN (United Nations) and other multilaterals, to ensure we are driving UK policy priorities. We ensure our public humanitarian commitments to Yemen and Syria contribute to increased societal and climate resilience through effective interventions.

The UK has pledged to spend £11.6 billion on International Climate Finance by the end of financial year 2025 to 2026. Given the vulnerability of the region to climate change and with COP 27 and COP 28 being in Egypt and the UAE respectively, the MENA Directorate will focus on the central (Directorate-led) climate focused programme, PHENOMENAL, as well as interventions at Post to deliver increased environmental resilience and accelerate clean energy transitions.

Who we work with

Programming: the Directorate has launched its flagship regional climate programme, PHENOMENAL. Delivery partners include the European Bank for Reconstruction and Development (EBRD), the UK Met Office and the International Water Management Institute (IWMI). The Directorate has also developed a new programme to further regional economic integration and is developing a new programme to support gender from a regional perspective.

The MENA CSSF (Conflict, Stability and Security Fund, and soon to be the Integrated Security Fund) portfolio continues to deliver effective interventions targeting some of the most pressing national security and conflict issues in the region. The Gulf Strategy Fund has helped to strengthen key relationships with partners in the Gulf.

Key programmes

Climate: Pioneering a Holistic approach to Energy and Nature-based Options in MENA for Long-term stability (PHENOMENAL)

The PHENOMENAL, £60 million regional climate programme supports climate action in MENA countries through 4 components:

1. High Impact Partnership for Climate Action (HIPCA): European Bank for Reconstruction and Development (EBRD)

HIPCA supports investments and policy solutions that reduce or prevent greenhouse gas emissions, reduce vulnerability to climate change; and improve environmental outcomes. The UK’s contribution is mobilising private sector money for adaptation and nature including demonstrating proof of concept and bringing pilots to scale through the provision of finance which de-risks investments. These include investing in electric vehicles to support the decarbonisation of public transport systems and deploying new green hydrogen technology.

To date: £25 million has been distributed for 9 projects in Egypt, Jordan, Morocco and Tunisia.

2. Weather and Climate Information Services (WISER) for MENA: UK Meteorological Office

Extreme weather, climate variability, and climate change remain significant and growing threats to sustainable development across MENA. Under PHENOMENAL, the UK’s contribution aims to expand the Met Office’s successful Weather and Climate Information Services in MENA. WISER will support climate decision making at local, national, and regional levels, that build resilience to the impacts of climate change. Activities involve strengthening the capacity of the regional climate centres and working with humanitarian partners to ensure that weather and climate information services support their anticipatory action.

3. Al Murunah: International Water Management Institute (IWMI)

MENA is the most water-scarce region in the world. Throughout the region both surface and groundwater resources, are under pressure and over exploited due to increasing demand. In response to these challenges, this project will increase water security in MENA through the integration of Resilient Nature Based Water Solutions (RNBWS) and Agricultural Water Management (AWM) in the face of climate change and land degradation. The project is developing innovative solutions to NBSW/AWM in Egypt, Jordan, Lebanon, and the Occupied Palestinian Territories. These practical examples will be exchanged via regional knowledge and learning activities to enhance water security and strengthen resilience of communities across the region.

4. Strategic Climate Response Fund (SCRF)

SCRF is as a small demand-responsive policy and analytics fund is to capitalise on strategic opportunities on energy, food and climate security in MENA.

Financial information

Initial allocations have been set internally to deliver the priorities set out in the International Development Strategy (May 2022) and the Integrated Review Refresh 2023, based on the FCDO’s Spending Review 2021 settlement.

The department’s spending plans for the period 2022 to 2023 to 2024 to 2025 have been revisited to ensure HM Government continues to spend around 0.5% of Gross National Income (GNI) on ODA. This was in the context of the significant and unexpected costs incurred to support the people of Ukraine and Afghanistan escape oppression and conflict and find refuge in the UK, and others seeking asylum. The Government provided additional resources of £1 billion in 2022 to 2023 and £1.5 billion in 2023 to 2024 to help meet these unanticipated costs. The Government remains committed to returning ODA spending to 0.7% of GNI when the fiscal situation allows, in line with the approach confirmed by the House of Commons in July 2021.

The country development partnership summaries include the breakdown of programme budgets allocated to individual countries for 2023 to 2024 and 2024 to 2025. These allocations are indicative and subject to revision as, by its nature, the department’s work is dynamic. Programme allocations are continually reviewed to respond to changing global needs, including humanitarian crises, fluctuations in GNI and other ODA allocation decisions.

These figures do not reflect the full range of UK ODA spending in each individual country or region. This is because they do not include spend delivered through core contributions to multilateral organisations, and country allocations do not include regional programmes delivered by the FCDO’s central departments. Other UK Government departments also spend a large amount of ODA overseas. Details of ODA spent by other UK government departments can be found in their Annual Report and Accounts and the Statistics for International Development.

FCDO Official Development Assistance allocation

For this business plan, ODA and non-ODA Financial Portfolio Management covers a relatively small budget allocation (amounts still to be confirmed for FY (financial year) 2022 to 2023 and for FY 2023 to 2024), including CSSF and our regional programmes for Climate, British Investment Partnerships and Gender.

Of ODA spend in 2023 to 2024 totalling £9 million just under 97% (£8,700,000) is focussed on supporting climate action in MENA, with the remaining 3% (£300,000) focussed on Investment Partnerships (economics).

The spend for 2024 to 2025 increases significantly to £19 million.

Allocated ODA budget for financial year 2023 to 2024	Indicative ODA budget for financial year 2024 to 2025
£9,000,000	£19,000,000

Figure 1. MENA Regional 2023 to 2024