A Delegation from Fund For Innovation (FID) Visited PSI

A delegation from the Fund for Innovation (FID) visited the Policy Studies Institute on April 18, 2024. The purpose of their visit was to assess the progress and results of various projects that the organization had previously funded in Ethiopia.

Founded in 2021 and led by Esther Duflo, who was awarded the Nobel Prize in Economics in 2019, the Fund for Innovation (FID) is a pioneering development finance mechanism. It was officially launched in December 2020 at the meeting of the Presidential Council for Development. The main focus of the fund is to fight poverty and gender inequality.

At the heart of the FID approach is the creation of synergies between innovation and research teams with the aim of testing and evaluating the impact of projects using rigorous scientific methods. FID aims to contribute to long-term public policy change by supporting the dissemination of proven innovations in the fight against poverty and gender inequality.

During the discussion, H.E. Professor Beyene Petros, Director General of the Policy Studies Institute (PSI), informed the delegation that PSI was formed from the merger of two former government think tanks. The Institute officially adopted the name PSI in 2018 but has been operating for almost 25 years.

H.E. Professor Beyene stated that the core principle of the Institute is to conduct evidence-based policy research. In addition, it provides advisory and consultancy services to the government and other stakeholders. The Institute proposes revisions and even replacements of existing policies based on rigorous research. PSI also conducts impact assessments, feasibility studies, cost-benefit analysis, and other research commissioned by international organizations and doners, such as the ongoing evaluation of the Agricultural Growth Program (AGP) and Home-Grown Economic Reform I(HGER 1).

Professor Beyene also emphasized that PSI is accountable to the Ministry of Planning and Development, pointing out that the Institute's researchers are highly qualified and are even now nominated by the government to evaluate the performances of various ministries on-site and face-to-face.

H.E. Professor Beyene explained that the PSI is divided into two major sectors: one focusing on the economic aspect and the other on the social aspect. Each sector is headed by a Deputy Director General.  The Institute also comprises six research centers and 14 research departments specializing in different areas, including gender, education, environment, climate, ICT, macroeconomics, finance, peace, health, industry, agriculture, governance, trade and more.

H.E. Professor Beyene explained to the delegate that each research department ideally consists of eight researchers, ranging from junior to senior level. In cases where the Institute lacks experts, it collaborates with other institutions to achieve critical mass.

On funding, Professor Beyene said PSI is funded by the government, finance from consultancy services and through participation in national and international grant calls such as UNICEF, the World Bank, FDI and others. He also informed the delegation about various important research projects carried out by PSI, including the economic costs of violence and the causes of conflict in Ethiopia.

The delegation then gave an overview of their organization, the Fund for Innovation (FID). Amina and her colleague explained that FID accepts proposals throughout the year from teams working on solutions for low-income countries. 

While the FID supports initiatives in the areas of education, health, gender equality, climate and projects from the 19 priority countries of French development policy, it is open to proposals from developing countries in any geographical map.

The delegates said the FID emphasized the importance of evidence-based and rigorous research that can inform policy decisions. They said it invited researchers, academics and think tanks from Ethiopia to apply for grants ranging from 50,000 to 4 million dollars, depending on the type and stage of the proposal.

Amina and her colleague emphasized that FID funds innovation that addresses the challenges of poverty and gender inequality and aims to make policies that impact the most vulnerable populations as effective as possible. It offers various types of grants to successful applicants and evaluates proposals based on their potential for impact, cost-effectiveness and scalability. The delegation also emphasized the importance of strong research teams in evaluating proposals.

The delegates said the FID held different interpretations of innovation, including technical, social, incremental and radical innovation. They emphasized that they were open to innovative concepts and encouraged applicants to think creatively in their proposals based on the different concepts of innovation mentioned above.

The visit of the delegation from the Fund for Innovation (FID) to the Policy Studies Institute marked an important milestone in fostering collaboration and knowledge exchange. The discussions held between the two organizations shed light on the valuable work undertaken by PSI in evidence-based policy research, consultancy services, and impact assessment. The FID, with its focus on supporting innovative solutions for poverty alleviation and gender equality, showcased its commitment to promoting research-backed interventions.

Overall, this visit not only strengthened the bond between FID and PSI but also opened doors for potential partnerships and funding opportunities in the pursuit of transformative development initiatives. Both organizations left the meeting with a shared vision of harnessing innovation, research, and rigorous methodologies to drive meaningful change and address pressing global challenges.

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