nep-afr New Economics Papers
on Africa
Issue of 2022‒08‒22
five papers chosen by
Sam Sarpong
Xiamen University Malaysia Campus

  1. Economic Consequences of the COVID-19 Pandemic on Sub-Saharan Africa: A historical perspective By Anthony Enisan Akinlo; Segun Michael Ojo
  2. Financial liberalization and its implications for private savings in sub-Saharan Africa By Elizabeth Asiedu; Fafanyo Asiseh; Theresa Mannah-Blankson; Jones Arkoh Paintsil
  3. Boosting African cities' resilience to climate change: The role of green spaces By Brilé Anderson; Jorge Eduardo Patiño Quinchía; Rafael Prieto Curiel
  4. Russia and the rise of Islamic terrorism in Sub-Saharan Africa By Kohnert, Dirk
  5. Resisting Social Pressure in the Household Using Mobile Money: Experimental Evidence on Microenterprise Investment in Uganda By Emma Riley

  1. By: Anthony Enisan Akinlo; Segun Michael Ojo
    Abstract: This paper examined the economic consequences of the COVID-19 pandemic on sub-Saharan Africa (SSA) using the historical approach and analysing the policy responses of the region to past crises and their economic consequences. The study employed the manufacturing-value-added share of GDP as a performance indicator. The analysis shows that the wrong policy interventions to past crises led the sub-Saharan African sub-region into its deplorable economic situation. The study observed that the region leapfrogged prematurely to import substitution, export promotion, and global value chains. Based on these experiences, the region should adopt a gradual approach in responding to the COVID-19 economic consequences. The sub-region should first address relevant areas of sustainability, including proactive investment in research and development to develop homegrown technology, upgrade essential infrastructural facilities, develop security infrastructure, and strengthen the financial sector.
    Date: 2022–07
  2. By: Elizabeth Asiedu; Fafanyo Asiseh; Theresa Mannah-Blankson; Jones Arkoh Paintsil
    Abstract: This paper employs data from 103 developing countries between 1981 and 2012 to examine the determinants of private savings in sub-Saharan Africa (SSA), with a focus on the effect of financial liberalization on private savings. It also analyses why the savings rate for SSA countries is lower than for other developing countries, by examining whether the determinants of private savings in SSA differ significantly from non-SSA countries.
    Keywords: Developing countries, Financial liberalization, Saving, Sub-Saharan Africa
    Date: 2022
  3. By: Brilé Anderson; Jorge Eduardo Patiño Quinchía; Rafael Prieto Curiel
    Abstract: The next few decades will bring an era of rapid urbanisation and unprecedented climate stress in African cities. Green spaces can boost the resilience of cities to heat waves, floods, landslides, and even coastal erosion, in addition, to enhancing sustainability by improving air quality, protecting biodiversity, and absorbing carbon. All of which can enhance well-being. Yet, data on the availability of green spaces in African urban agglomerations is scarce. This analysis fills the gap by combining new and novel data sources to estimate the availability of green spaces in 5 625 urban agglomerations with 10 000 inhabitants and above. The rest of the report then uses this novel dataset to first evaluate the dynamics between urbanisation and green spaces, and second, explore the potential of green spaces to boost the resilience and sustainability of cities in the future. The results show that as urban agglomerations become larger and more compact, green spaces disappear, exacerbating their vulnerability to climate change and deteriorating liveability. However, building taller buildings (i.e., growing vertically), offers a way for cities to grow whilst minimising loss of green space. Results show that more green space can boost sustainability by significantly lowering air pollution in African cities, which could be vital for public health in the future since outdoor air pollution is rising. The potential for green spaces to enhance resilience to climate events, like heat waves, depends on the location of green spaces throughout the city and the percentage of the population that lives close to a green space (i.e., within 300 metres). Green spaces may play a limited role in coping with heat waves in a city like Khartoum where only 3% of the population lives close to a green space, but could be a nature-based solution to heat waves in a city like Abuja, where 55% of the population can benefit from its cooling effects. Moving forward, local actors have clear evidence of the power of green spaces to build a sustainable and resilient future. Still, the report reveals that local actors need support from regional and national actors to realise the potential of green spaces.
    Keywords: Africa, Cities, Ecosystem-services, Green spaces, Nature-based solutions, Resilience, Sustainability
    JEL: Q53 Q54 Q56 Q57 R14 R15 R52
    Date: 2022–07–31
  4. By: Kohnert, Dirk
    Abstract: Russia and China challenge the liberal order and rule of law on a global and regional level. The Trump administration has facilitated the support of the move away from the liberal international order and the ‘Westphalian’ system of states that America had defended for centuries. Extremism is thriving around the world, including in sub-Saharan Africa, fuelled by the aftermath of colonialism, poverty and Islamist ideologies. Regions with limited statehood became failed states where violent conflicts threatened regional security and stability. Russia benefited from the resulting power vacuum. Moscow focused on countries that were formerly French and Portuguese colonies, which Moscow believed are easier to infiltrate. Under these conditions, Putin is free to exploit the political and social contradictions in Africa and destabilize the Western order, even at the risk of the rise of Islamic terrorism. Terrorist criminal pipelines and corrupt states have been exploited by Russian arms dealers across Africa for decades. These included notorious support for the Taylor regime in Liberia in the early 2000s, including the infamous Russian arms dealer Viktor Bout, dubbed the ‘merchant of death’. The cooperation was based on state control of ports of entry and exit for criminal organizations to safeguard profit-sharing, diplomatic passports, including associated immunity, and the rule of law, which ensured the smooth marketing of these companies. Today, Russia benefits primarily from providing ‘security’ to autocratic leaders, including arms sales, advice and training in counterinsurgency and counterterrorism operations against Islamic terrorism in exchange for access to African resources and markets. Aside from Al-Quida, the Islamic State (ISIS), Boko Haram and Al-Shabaab other local Islamic organizations are fuelling terrorism in SSA. Moscow is particularly interested in the Horn of Africa to control important trade routes of global importance.
    Keywords: Russia; Vladimir Putin; Sub-Saharan Africa; global power; African resources; fragile state; poverty; extremism; Islamist terrorism; Boko Haram; ISIS; arms deals; arms industry; Eritrea; Nigeria; Ghana; Senegal; Mali; Burkina Faso; Mozambique; Somalia; Kenya; South Sudan; Horn of Africa; Postcolonialism; Westphalian sovereignty; fake news; Françafrique; African Studies;
    JEL: E26 F13 F35 F52 F54 H56 N17 N47 O17 P16 P26 Z13
    Date: 2022–06–14
  5. By: Emma Riley
    Abstract: Intra-household sharing pressure has been shown to be a key constraint on female enterprise growth in developing countries. However, the growth of digital financial services offers a new way to reduce this sharing pressure. In this paper, I examine whether changing the form that a microfinance loan is disbursed in, from cash to directly onto a digital account, enables female microfinance borrowers to grow their businesses. Using a field experiment of 3,000 female borrowers in Uganda, I compare the disbursement of a loan as cash to the disbursement of a loan onto a mobile money account. After 8 months, women who received their microfinance loan on the mobile money account had 11% higher levels of business capital and 15% higher business profits compared to a control group who received their loan as cash. Total household income and consumption were also higher. Impacts were greatest for women who experienced pressure to share money with others in the household at baseline, suggesting that providing the loan in a digital account reduces sharing of the loan with others, to the benefit of both the woman's business and household. This indicates that widespread mobile money services can be utilised to counteract the negative impact of sharing pressure on the performance of female-owned enterprises.
    JEL: O12 O16 D13 D14 C93 J16
    Date: 2022–05–10

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