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on Africa |
| By: | Wim Naudé |
| Abstract: | It is increasingly apparent that, despite earlier hopes, the global economic crisis will have a significant impact on the economies of Sub-Saharan Africa. In order to co-ordinate and craft the most appropriate responses for African economies to withstand and recover from the crisis, it is necessary to identify the degree to which the continent, as well as the individual African countries, is at risk of being negatively impacted. This depends on both vulnerability to trade and financial shocks, as well as the resilience of countries to cope with these shocks. Accordingly, vulnerability and resilience indices are constructed for the continent and individual countries. It is shown that, of all developing regions, Africa is the most at risk from the crisis: it has higher vulnerability to trade and financial shocks, and it has the least resilience of all regions. Based upon a vulnerability-resilience matrix, the African countries most at risk are the Democratic Republic of the Congo, Burundi, Côte D'Ivoire, Liberia, Angola, the Sudan, Chad, Guinea-Bissau, Guinea, Zimbabwe, Somalia, Kenya, Mali, Nigeria, Ghana, Cape Verde and Mauritania. With a few notable exceptions, such as Kenya and Ghana, these are all 'fragile states'. Based upon the distinction between vulnerability and resilience, an action guide is proposed. This makes a distinction between short-term and longer-term actions, in particular be-tween actions aimed at mitigating the impact of the external shocks, assisting countries to cope, and actions aimed at reducing risk. |
| Keywords: | Global financial crisis, Africa, vulnerability, resilience, fragile states. . |
| Date: | 2010–01–29 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2010/27&r=afr |
| By: | Nicolas Berman and Philippe Martin |
| Abstract: | In the early stage of the 2008-2009 financial crisis, the conventional wisdom was that financial under-development of sub Saharan African economies may have been a bless-ing in disguise because it insulated them from the direct effects of the crisis. This paper argues that this may also make African exporters, dangerously more dependent on the health of financial institutions in countries where they export. In the 2008-2009 financial crisis, we find that African exports to the US have been hit more than other countries. On past financial crises (1976-2002), we find that African exporters are more vulnerable to recessions in partner countries. Hence, African countries seem more affected by the income effect of financial crises. In addition to this income effect, we find that, for the average exporter, the disruption effect due to a financial crisis in the partner country is moderate (a deviation from the gravity predicted trade of around 2 to 8%) and long lasting (around 7 years). We find however that the disruption effect is much larger for African exporters as the fall in trade (relative to gravity) is at least 20% more than for other countries in the aftermath of the crisis. Only a part of the vulnerability of African exports comes from a composition effect as primary exports are hit more than manufac-turing exports. We also provide evidence that African countries more dependent on trade finance are hit more badly |
| Keywords: | International trade, financial crises, trade collapse, Africa |
| Date: | 2010–01–29 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2010/15&r=afr |
| By: | Paul Alagidede (Department of Economics, University of Stirling); Theodore Panagiotidis (Department of Economics, University of Macedonia) |
| Abstract: | The extent to which the stock market provides a hedge to investors against inflation is examined for African stock markets. By employing parametric and nonparametric cointegration procedures, we show that the point estimates of the elasticities of stock prices with respect to consumer prices range from 0.015 for Tunisia to 2.264 for South Africa, evidence of a positive long-run relationship. Further, the time path of the response of stock prices to innovations in consumer prices exhibits a transitory negative response for Egypt and South Africa, which becomes positive over longer horizons: important indication that the stock market tends to provide a hedge against rising consumer prices in African markets. |
| Keywords: | Stock Prices, Inflation, Fisher Effect, African Stock Markets, Cointegration |
| JEL: | G10 G15 C32 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:mcd:mcddps:2010_06&r=afr |
| By: | Richard Black (Development Research Centre on Migration, Globalisation and Poverty and Sussex Centre for Migration Research, University of Sussex); Jon Sward (Development Research Centre on Migration) |
| Abstract: | This paper focuses on the specific question of how Poverty Reduction Strategy Papers (PRSPs) address migration and its potential to enhance human development at the national level. Based on a review of PRSPs completed since 1999, it argues that migration often remains poorly recognised or analysed in poorer countries in terms of its impacts on poverty reduction, whilst attitudes towards migration in these countries are often highly negative and/or based on limited evidence, especially in relation to internal migration. Analysis of how both internal and international migration are treated in PRSPs is also placed in the context of a broader understanding of the purpose of, and constraints faced by the PRS process. The paper goes on to highlight the extent to which in Sub-Saharan African countries, successive drafts of PRSPs have shown increasing attention to migration. It also considers how analysis of the problems and opportunities associated with different types of migration are converted into policy initiatives, highlighting the lack of good practice in terms of the incorporation of migration into human development policy. |
| Keywords: | Poverty Reduction Strategy Papers (PRSPs), internal migration, international migration, sub-Saharan Africa, analysis of migration |
| JEL: | O1 O15 F22 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:hdr:papers:hdrp-2009-38&r=afr |
| By: | Andrew Mold and Annalisa Prizzon |
| Abstract: | Sub-Saharan Africa's export performance over recent decades has typically been por-trayed as poor compared to other regions in developing countries. This paper takes a new look at the record, using data on the volume rather than the value of African ex-ports. When analysed in volume terms a different picture of African export performance emerges. Despite being confronted by sharply declining prices, between 1995-2001 Afri-can exports expanded by an average of 5.9 percent annually. The picture changes quite significantly during the post-2002 commodity price boom period, with increases of 5.2 per cent per annum in average volumes. By using a dynamic panel of 36 Sub-Saharan countries, the aim of this paper is to analyse this apparent paradox, using data available from UNCTAD. Specifically, we investigate the price-elasticity response of African ex-porters in the light of dramatically shifting unit prices. In the context of the EDR project, we also specifically look at the question of whether countries classified as ´fragile states´ have been especially disadvantaged in terms of their export performance. |
| Keywords: | export determinants, Sub-Saharan Africa, export performance, commodity prices |
| Date: | 2010–01–29 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2010/21&r=afr |
| By: | Franklin Allen and Giorgia Giovannetti |
| Abstract: | This paper analyses the channels through which the economic and financial crisis of 2008-2009 is transmitted to fragile countries in Sub-Saharan Africa. Trade stands out as the main direct channel, even though intra-Africa remittances play a relevant role, given that most migrants in Sub-Saharan Africa fragile countries cannot afford the cost of mi-grating to Europe or to the United States and stay close, remaining in the continent. Whether reduced aid flows also act as a crisis transmission channel remains an open question, even though preliminary estimates suggest that, at least in the medium run, OECD countries are likely to lower aid, with potentially very damaging effects on fragile countries. The paper also shows that fragile countries are characterised by very low re-silience and capacity to cope with shocks. It concludes, by highlighting how Sub-Saharan Africa fragile countries' policymakers' room for manoeuver is limited in periods of crisis because of low fiscal space and limited institutional capacity. It advocates that the right response to the crisis would be to mobilise domestic resources, although this will require functional institutions able to offset the potential trade-offs between adverse short-term shocks and a long-term perspective. |
| Keywords: | financial crisis, Sub Saharan Africa, real transmission channels. JEL Classification F0 O1. |
| Date: | 2010–01–29 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2010/13&r=afr |
| By: | Andrew Mold and Annalisa Prizzon |
| Abstract: | Sub-Saharan Africa's export performance over recent decades has typically been por-trayed as poor compared to other regions in developing countries. This paper takes a new look at the record, using data on the volume rather than the value of African ex-ports. When analysed in volume terms a different picture of African export performance emerges. Despite being confronted by sharply declining prices, between 1995-2001 Afri-can exports expanded by an average of 5.9 percent annually. The picture changes quite significantly during the post-2002 commodity price boom period, with increases of 5.2 per cent per annum in average volumes. By using a dynamic panel of 36 Sub-Saharan countries, the aim of this paper is to analyse this apparent paradox, using data available from UNCTAD. Specifically, we investigate the price-elasticity response of African ex-porters in the light of dramatically shifting unit prices. In the context of the EDR project, we also specifically look at the question of whether countries classified as ´fragile states´ have been especially disadvantaged in terms of their export performance. |
| Date: | 2010–03–15 |
| URL: | http://d.repec.org/n?u=RePEc:erp:euirsc:p0239&r=afr |
| By: | Jonathan Crush (Southern African Migration Project (SAMP) and Southern African Research Centre (Queen’s University)); Sujata Ramachandran (Southern African Migration Project (SAMP)) |
| Abstract: | In the continuing discussion on migration and development, the vulnerability of all migrant groups to exploitation and mistreatment in host countries has been highlighted along with an emphasis on protecting their rights. However, xenophobia has not yet received explicit attention although anti-migrant sentiments and practices are clearly on the rise even in receiving countries in developing regions. Despite gaps in existing empirical work, research and anecdotal evidence exposes pervasive forms of discrimination, hostility, and violence experienced by migrant communities, with the latter becoming easy scapegoats for various social problems in host countries. This study attempts to insert xenophobia in this debate on migration and development by examining the growth of this phenomenon in host countries in the South. It provides short accounts of xenophobia witnessed in recent times in five countries including South Africa, India, Malaysia, Libya, and Thailand. The ambiguity surrounding the concept is discussed and crucial features that define xenophobia are outlined. A variety of methods to study it are likewise identified. Using a wide range of examples from diverse contexts, the paper explores possible reasons for the intensification of xenophobia. The final sections of the paper briefly outline the developmental consequences of rampant xenophobia for migrant and host populations while examining policy options to tackle it. |
| Keywords: | Xenophobia; anti-immigrant prejudice; violence; intolerance; social exclusion; discrimination; migrant vulnerability; policy; South Africa, India, Libya, Thailand, Malaysia |
| JEL: | O1 O15 Z1 F22 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:hdr:papers:hdrp-2009-47&r=afr |
| By: | Edward Miguel (Center of Evaluation for Global Action, University of California, Berkeley); Joan Hamory (Centre of Evaluation for Global Action, University of California) |
| Abstract: | This study exploits a new longitudinal dataset to examine selective migration among 1,500 Kenyan youth originally living in rural areas. We examine whether migration rates are related to individual “ability”, broadly defined to include cognitive aptitude as well as health, and then use these estimates to determine how much of the urban-rural wage gap in Kenya is due to selection versus actual productivity differences. Whereas previous empirical work has focused on schooling attainment as a proxy for cognitive ability, we employ an arguably preferable measure, a pre-migration primary school academic test score. Pre-migration randomized assignment to a deworming treatment program provides variation in health status. We find a positive relationship between both measures of human capital (cognitive ability and deworming) and subsequent migration, though only the former is robust at standard statistical significance levels. Specifically, an increase of two standard deviations in academic test score increases the likelihood of rural-urban migration by 17%. Accounting for migration selection due to both cognitive ability and schooling attainment does not explain more than a small fraction of the sizeable urban-rural wage gap in Kenya, suggesting that productivity differences across sectors remain large. |
| Keywords: | Migration, selection, human capital, ability, urban-rural wage gap, productivity |
| JEL: | O1 O15 C3 C33 F22 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:hdr:papers:hdrp-2009-45&r=afr |
| By: | Bart de Bruijn |
| Abstract: | In the study of international mobility, refugees make up a very specific population. In contrast to most migrants, forcibly displaced persons have little opportunity for expanding livelihoods, and are usually faced with realities that deny them a dignified life and fulfilment of their capabilities. In many situations, people who left their homes to escape from persecution, armed conflict or violence face restrictive policies of the countries in which they found refuge and become critically dependent on humanitarian assistance. This paper describes living conditions and wellbeing of refugees – and more particularly camp-based refugees – in six countries with protracted refugee conditions: Tanzania, Uganda and Kenya in Africa, and Nepal, Bangladesh and Thailand in Asia. It primarily draws on UNHCR’s ‘Standards and Indicators’ data. Thematic areas covered in the paper include legal protection, gender-related issues, food security and nutritional status, health, education, and refugee livelihoods and coping strategies. The assessment of refugees’ living conditions proceeds along two different perspectives. The first is a gap analysis based on UNHCR standards, which are largely in line with SPHERE standards. The second is a comparison of refugees’ living conditions with those of host populations in the country of asylum and with those of populations on the country of origin. The available data lead to the conclusion that the living conditions of refugees vary across thematic areas and are strongly contextualised, depending on a complex of social, economic, political and attitudinal factors. There is also evidence that despite often grim conditions, at times the targeted efforts of humanitarian assistance and own coping strategies produce situations for refugees that are relatively better than that of the local hosting communities or the population in the region of origin. |
| Keywords: | human development, human mobility, migration, poverty |
| JEL: | O1 I3 O15 F22 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:hdr:papers:hdrp-2009-25&r=afr |
| By: | Philip Verwimp (University of Antwerp); Tom Bundervoet (Vrije Universiteit Brussel) |
| Abstract: | Child health during and after violent conflicts has been a priority for both policymakers and academics, as ill-health in early life can be impossible to make up for in later life, and has important effects on education and adult wages. In order for policy interventions to mitigate health impacts, it is essential to understand the channels through which conflict impacts on child health. This briefing uses empirical results of research in Burundi and Rwanda to identify these channels. It outlines the policy implications of these findings, arguing that policymakers should prioritise interventions to rebuild agricultural capacity and improve sanitation conditions and nutrition in displacement camps. |
| Keywords: | violent conflict; child health; Burundi; Rwanda; policy |
| JEL: | C78 D72 D74 D83 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:mcn:polbrf:6&r=afr |
| By: | Janvier D. Nkurunziza |
| Abstract: | The financial sector in Burundi has had a very limited effect on the country's development. High political and economic risks have prevented banks from engaging in long-term lending, constraining long-term investment. Moreover, the industrial organisation of the financial sector is not conducive for development lending because the sector is used more as a source of rents than development finance. As a result, the financial sector has been unable to address the needs of the core drivers of growth in Burundi, namely, agriculture and industry. Therefore, increasing the financial sector's participation in Burundi's economic development will require an improvement in political and macro-economic stability, as well as an increase of financial institutions' long-term re-sources. Most particularly, development banking should play its role of fostering the development of agriculture and the rural economy. In addition, more competition in the financial sector should be encouraged with the aim of diversifying financial services and pushing the sector's boundaries beyond the traditional urban market to embrace the rural economy where most economic activities take place. |
| Date: | 2010–03–15 |
| URL: | http://d.repec.org/n?u=RePEc:erp:euirsc:p0243&r=afr |