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on Project, Program and Portfolio Management |
| By: | Gernot Pehnelt (School of Busniess and Economics, Friedrich-Schiller-University Jena, Germany.) |
| Abstract: | In recent years, China has become a major power on the African continent, not only with respect to trade and investment, but also as a donor of development aid. Although there is no accurate measure of the exact size of China’s aid program, since China rather underestimates the volume in official statistics, estimates on the basis of press releases, official announcements and assessments of major projects in Africa suggest that China has already overtaken the World Bank in lending to Africa. In this article, we analyze China’s aid policy in Africa from a political economy perspective. We show that China is using (tied) aid and loans in order to reach specific economic and political goals and that Beijing has been quite successful in doing so. The impressing success of China in getting access to African countries can be explained by comparative advantages of the People’s Republic, especially in unstable nations and "rough" states. China’s engagement in Africa causes some serious problems with traditional donors. We discuss these conflicts and provide a critical assessment of China’s role in Africa. Finally, we discuss the policy implications for the donor community. |
| Keywords: | China, Africa, development aid, political economy |
| JEL: | O16 O19 F35 F50 |
| Date: | 2007–08–22 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2007-051&r=ppm |
| By: | Skees, Jerry; Mahul, Olivier |
| Abstract: | This paper describes the index-based livestock insurance program in Mongolia designed in the context of a World Bank lending operation with Government of Mongolia and implemented on a pilot basis in 2005. This program involves a combination of self -insurance by herders, market-based insurance, and social insurance. Herders retain small losses, larger losses are transferred to the private insurance industry, and extreme or catastrophic losses are transferred to the government using a public safety net program. A syndicate pooling arrangement protects participating insurance companies against excessive insured losses, with excess of loss reinsurance provided by the government. The fiscal exposure of Government of Mongolia toward the most extreme losses is protected with a contingent credit facility. The insurance program relies on a mortality rate index by species in each local region. The index provides strong incentives to individual herders to continue to manage their herds so as to minimize the impacts of major livestock mortality events; individual herders receive an insurance payout based on the local mortality, irrespective of their individual losses. This project offered the first opportunity to design and implement an agriculture insurance program using a country-wide agricultural risk management approach. During the first sales season, 7 percent of the herders in the three pilot regions purchased the insurance product. |
| Keywords: | Insurance & Risk Mitigation,Insurance Law,Hazard Risk Management,Debt Markets,Banks & Banking Reform |
| Date: | 2007–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:4325&r=ppm |
| By: | G. Cornelis van Kooten; Brent Sohngen |
| Abstract: | Carbon terrestrial sinks are seen as a low-cost alternative to fuel switching and reduced fossil fuel use for lowering atmospheric CO2. In this study, we review issues related to the use of terrestrial forestry activities to create CO2 offset credits. To gain a deeper understanding of the confusing empirical studies of forest projects to create carbon credits under Kyoto, we employ meta-regression analysis to analyze conditions under which forest activities generate CO2-emission reduction offsets at competitive ‘prices’. In particular, we examine 68 studies of the costs of creating carbon offsets using forestry. Baseline estimates of costs of sequestering carbon are some US$3–$280 per tCO2, indicating that the costs of creating CO2-emission offset credits through forestry activities vary wildly. Intensive plantations in the tropics could potentially yield positive benefits to society, but in Europe similar projects could cost as much as $195/tCO2. Indeed, Europe is the highest cost region, with costs in the range of $50-$280 per tCO2. This might explain why Europe has generally opposed biological sinks as a substitute for emissions reductions, while countries rush to finance forestry sector CDM projects. In Canada and the U.S., carbon sequestration costs range from a low of about $2 to nearly $80 per tCO2. One conclusion is obvious: some forestry projects to sequester carbon are worthwhile undertaking, but certainly not all. |
| Keywords: | climate change, Kyoto Protocol, meta-regression analysis, carbon-uptake costs, forest sinks |
| JEL: | Q2 Q25 H43 C19 |
| Date: | 2007–04 |
| URL: | http://d.repec.org/n?u=RePEc:rep:wpaper:2007-02&r=ppm |
| By: | ARIMOTO Yutaka; KONO Hisaki |
| Abstract: | Recent empirical studies reveal that effectiveness of aid on growth is ambiguous. This paper considers aid proliferation - excess aid investment relative to recurrent cost - as a potential cause that undermines aid effectiveness, because aid projects can only produce sustainable benefits when sufficient recurrent costs are disbursed. We consider the donor's budget support as a device to supplement the shortage of the recipient's recurrent cost and to alleviate the misallocation of inputs. However, when donors have self-interested preferences over the success of their own projects to those conducted by others, they provide insufficient budget support relative to aid which results in aid proliferation. Moreover, aid proliferation is shown to be worsened by the presence of more donors. |
| Date: | 2007–08 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:07051&r=ppm |
| By: | David R. Skeie |
| Abstract: | Vesting of equity payments to an entrepreneur, which is a form of time-contingent compensation, is very common in venture capital contracts. Empirical research suggests that vesting is used to help overcome asymmetric information and agency problems. We show in a theoretical model that vesting equity to an entrepreneur over a long period of time acts as a screening device against a bad entrepreneur type. But incomplete contracts due to hold-up by the venture capitalist imply that equity compensation, in the form of either short-term or long-term vesting, cannot provide standard contractible equity incentives for the entrepreneur to take an unobservable action involving effort. We introduce a new model of effort based on a verifiable choice of an effort-intensive project, for which the short-term vesting of equity can provide incentives, but which results in a trade-off between incentives and screening. Contingent control rights are a substitute for short-term vesting and provide the largest incentives for effort by fully protecting the entrepreneur from hold-up. We also show that a new link between equity cash flow claims and control rights is that residual equity control rights over the firm are necessary to protect residual equity claims from hold-up. |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednsr:297&r=ppm |
| By: | Schmukler, Sergio L.; Gozzi, Juan Carlos; de la Torre, Augusto |
| Abstract: | Interest in access to finance has increased significantly in recent years, as growing evidence suggests that lack of access to credit prevents lower-income households and small firms from financing high return investment projects, having an adverse effect on growth and poverty alleviation. This study describes some recent innovative experiences to broaden access to credit. These experiences are consistent with an emerging new view that recognizes a limited role for the public sector in financial markets, but contends that there might be room for well-designed, restricted interventions in collaboration with the private sector to foster financial development and broaden access. The authors illustrate this view with several recent experiences in Latin America and then discuss some open policy questions about the role of the public and private sectors in driving these financial innovations. |
| Keywords: | Debt Markets,Banks & Banking Reform,,Emerging Markets,Bankruptcy and Resolution of Financial Distress |
| Date: | 2007–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:4326&r=ppm |