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31. Electric Vehicles and the Changing Automotive GVC: A Window of Opportunity for African Countries?

Author:
Tobias Wuttke
Publication Date:
03-2023
Content Type:
Policy Brief
Institution:
Centre for Business and Development Studies (CBDS), Copenhagen Business School
Abstract:
Only two African countries have successfully integrated with the automotive GVC to date: South Africa and Morocco. Their experiences, compared to other even more successful developing and emerging economies with automotive industries, highlight both the opportunities as well as the limitations of automotive GVC participation as an economic development engine. Scale in vehicle production, facilitated by government industrial policy, is the key prerequisite for successful participation with localisation benefits. These fundamentals do not change with the shift to electric vehicles. Governments in Africa and elsewhere need to attract FDI in electric vehicle production and from there can support the development of a local component and materials value chain. Once these basics are covered, governments and local firms can aim for making use of the technological window of opportunity by investing in EV-related technology, mainly battery technology, to potentially capture more value from automotive GVC participation than has traditionally been possible in the ICE vehicle value chain.
Topic:
Development, Industrial Policy, Foreign Direct Investment, Global Value Chains, Automotive Industry, and Electric Vehicles
Political Geography:
Africa

32. Current Capabilities and Future Potential of African Textile and Apparel Industries

Author:
Lindsay Whitfield and Chema Triki
Publication Date:
01-2023
Content Type:
Policy Brief
Institution:
Centre for Business and Development Studies (CBDS), Copenhagen Business School
Abstract:
The textile and apparel industry is a globalised industry characterised by a high degree of dependency and fragmentation in global supply chains. From the mid-20th century, cotton textile and apparel manufacturing production relocated from industrialised to developing countries, particularly in Asia, and was quickly followed by the emergence of the petrochemical industry and synthetic fibre production in East Asian countries, while South Asia continued to focus on cotton and natural fibres. China, Bangladesh, and Vietnam are currently the central players in global apparel supply chains, with China and increasingly Vietnam having vertically integrated industries with access to a diverse range of fabrics and thus a large product portfolio. The largest apparel consumer markets are concentrated in Europe, North America, and other wealthy countries such as Japan, as they have higher purchasing power and economically larger markets. Large emerging economies such as China and India largely supply their domestic markets but have not yet become major destination consumption markets for other developing economies. Changes in international trade over the past 30 years fostered the textile and apparel global value chain dynamic. These changes were marked by opening trade borders, lowering tariffs, tax breaks or subsidies offered by various governments, and free trade agreements. Low labour costs and lower production costs have shaped the decisions of global actors to relocate their operations from one country to another. Current global trends are set to transform the global value chains of textiles and apparel again. These trends include increasing production costs in China, the drive to shorten supply chains post-Covid pandemic through nearshoring and seeking countries with yarn-to-garment (or vertical) production capabilities, and a sustainability shift. These trends are leading global apparel buyers to diversify their sourcing away from China and Asia more generally and to consider new supply bases. These structural trends in the industry, together with the AfCFTA, represent a window of opportunity for African countries. African industry actors and their governments should build new textile and apparel industries that seek to participate in global and regional markets and engage with global technologies and international partnerships. Attracting foreign firms with the necessary technical, organisational, and managerial capabilities is essential. The AfCFTA represents a powerful tool to respond to the verticality need of the industry, considering the current production levels of raw materials, but also an opportunity to increase the number of African countries with industrial capabilities in textile and apparel. The ongoing negotiations on rules of origin will significantly impact the continent's potential to create synergetic regional value chains.
Topic:
Development, Industrial Policy, International Trade and Finance, Business, Supply Chains, and Textile Industry
Political Geography:
Africa

33. Climate Change Mitigation for Late Industrialisers: The Role of Technology Intensity in Manufacturing

Author:
Elvis Korku Avenyo and Fiona Tregenna
Publication Date:
02-2023
Content Type:
Policy Brief
Institution:
Centre for Business and Development Studies (CBDS), Copenhagen Business School
Abstract:
Many developing countries now have a renewed focus on industrialisation and industrial policy. This is based on the recognition that industrialisation is a key driver of long-term economic progress and is the central route to improve the well-being of citizens in developing countries (Chenery, 1955; Tregenna, 2016; United Nations Industrial Development Organization [UNIDO], 2016). At the same time, the climate crisis poses an existential threat to the global economy and to humanity and has emerged as a challenge to the industrial development prospects and pathways of developing countries. This is because industrialisation is an important contributor to global warming, specifically to anthropogenic emissions of cardon dioxide (CO2.) (Adom et al., 2012; Han & Chatterjee, 1997). Late industrialisers thus face a dual challenge: industrialising while mitigating climate change (Altenburg & Rodrik, 2017). Hence, there is now a degree of tension as to how late industrialisers can achieve long-term economic development under paths involving heavy or intensive industrialisation, while mitigating emissions and environmental damage more broadly. An emerging discourse recognises the critical need for developing countries to push towards industrial development that, while generating growth in productivity and jobs, is also environmentally sustainable. This is especially important, as poorer countries are particularly vulnerable to the immediate effects of the climate crisis (Altenburg & Rodrik, 2017; Padilla, 2017). Thus, transforming towards sustainable production systems and green industrial policies offers developing countries opportunities to industrialise in an environmentally sustainable way while contributing to job creation and economic prosperity (Altenburg & Rodrik, 2017; Padilla, 2017; Rodrik, 2014). However, the high ‘green premia’ and new access barriers to the ‘green’ energy technologies from advanced economies directly threaten this potential sustainable industrial development pathway in developing countries.
Topic:
Climate Change, Development, Science and Technology, Manufacturing, Industrialization, Sustainability, and Carbon Emissions
Political Geography:
Global Focus

34. EU Development Cooperation Policy Shifts from Charity to Self-interest

Author:
Patryk Kugiel
Publication Date:
06-2023
Content Type:
Working Paper
Institution:
The Polish Institute of International Affairs
Abstract:
In recent years, the EU’s development cooperation policy has evolved, moving away from an approach based on poverty eradication and the needs of partner countries to focusing more on its own interests. This change is supported by the majority of EU members. This gives the EU the opportunity to exert strategic influence in the world but risks the loss of its unique identity as an altruistic donor and attractive partner in development cooperation. The change in the Union’s approach is consistent with the position of Poland, which can use it to reform and strengthen its development aid system.
Topic:
Development, Regional Cooperation, European Union, and Development Aid
Political Geography:
Europe and Poland

35. Financing Loss and Damage at Scale: Toward a Mosaic Approach

Author:
Michael Franczak
Publication Date:
05-2023
Content Type:
Policy Brief
Institution:
International Peace Institute
Abstract:
The historic decision on loss and damage (L&D) at the 2022 UN Climate Change Conference (COP27) calls for a new fund and funding arrangements focused on addressing L&D. It also tasks a Transitional Committee to prepare recommendations on the new fund and funding arrangements for adoption at the 2023 UN Climate Change Conference (COP28) in Dubai. This decision reflects a recognition that existing funding arrangements are grossly inadequate to address the escalating scale of L&D. Addressing L&D will require both enhancing these existing arrangements and creating a new fund and funding arrangements, forming a mosaic of solutions across countries, institutions, and markets. This paper aims to aid the Transitional Committee and other stakeholders by providing an initial sketch of that mosaic. First, it examines existing arrangements, modalities, and sources of funding for addressing L&D from UN humanitarian agencies, multilateral development banks and international financial institutions, and insurance and bond markets. Second, it proposes reforms to existing arrangements that would address key finance gaps and bottlenecks. Third, it identifies elements of a new L&D fund that would complement existing arrangements and make use of innovative finance (including levies and bond issuances) to operate at scale. With roughly six months left until COP28, the Transitional Committee will need to work efficiently to achieve its mandate, which includes determining the fund’s institutional arrangements, modalities, structure, governance, sources of funding, and coordination and complementarity with existing funding arrangements. To this end, the paper recommends that it should: Begin securing financing before COP28, particularly innovative financing, which takes longer to secure than traditional donor contributions; Consult with the private sector to determine its role, including in the use of insurance mechanisms and risk pools, frontloading, and connections between L&D and jobs; Determine the form and role of triggers, including for slow-onset events; Consider how to address noneconomic losses, including displacement and forced migration; and Identify the actions, mechanisms, and institutions required to operationalize the fund, including an internal or external coordination mechanism.
Topic:
Climate Change, Development, United Nations, and Finance
Political Geography:
Global Focus

36. Global Inequality in Well‐​Being Has Decreased across Many Dimensions: Introducing the Inequality of Human Progress Index

Author:
Chelsea Follett and Vincent Geloso
Publication Date:
06-2023
Content Type:
Policy Brief
Institution:
The Cato Institute
Abstract:
The world has seen dramatic, global human progress across a broad range of indicators in recent decades, but have those gains been widely shared? The Inequality of Human Progress Index (IHPI) measures relative gaps in global development. It surveys international inequality across a greater number of dimensions than any prior index. By analyzing inequality in a multidimensional way, the IHPI takes inequality more seriously than those indexes that focus on income inequality alone. The IHPI considers material well‐​being and seven additional metrics: lifespan, infant mortality, adequate nutrition, environmental safety, access to opportunity (as measured by education), access to information (as measured by internet access), and political freedom. Across all but two of those dimensions, the world has become more equal since 1990. Globalization and market liberalization over the past few decades have not only raised absolute living standards but also reduced overall inequality.
Topic:
Development, Inequality, Economy, and Well-Being
Political Geography:
Global Focus

37. Southeast Asia Aid Map - Key Findings Report

Author:
Alexandre Dayant, Grace Stanhope, and Roland Rajah
Publication Date:
06-2023
Content Type:
Commentary and Analysis
Institution:
Lowy Institute for International Policy
Abstract:
Official development finance plays an important role in financing Southeast Asia’s development, equivalent to around 10% of total government development spending in the region. China is Southeast Asia’s single largest development partner and leads infrastructure financing. Yet, implementation problems have seen the scale of China’s financing decline in recent years. Traditional development partners collectively still dominate development financing in Southeast Asia at 80% of the total. The multilateral development banks lead the way, followed by Japan, Europe, and South Korea. The United States and Australia are mid-sized players. India and the Middle East have become notable sources of non-traditional development finance, with the Islamic Development Bank playing an important role. Climate development finance is increasing, but Southeast Asia will need more support if it is to transition towards resilient, low-carbon development. Intraregional development cooperation is growing, but only makes up a small part of development finance in Southeast Asia.
Topic:
Climate Change, Development, Humanitarian Aid, Finance, and Economy
Political Geography:
Asia and Southeast Asia

38. Assessing Community Sensitivity to Cross-Border Security in Ghana

Author:
Mawusi Yaw Dumenu, Newton Yaw Norviewu, Balaarah Abdulai, and Nana Kwabena Aborampah Mensah
Publication Date:
03-2023
Content Type:
Research Paper
Institution:
Ghana Center for Democratic Development
Abstract:
Strengthening the integrity of Ghana’s borders is essential for the welfare of the nation and its people. National efforts to prevent illegal cross-border activities, including illicit goods, persons and activities require full involvement of all Ghanaians, especially those living in border areas. This has become even more important considering the regional insecurity posed by terrorist groups and violent extremists. It is therefore imperative that residents be sensitized to potential threats associated with irregular cross-border activities that have a potential to facilitate activities of criminal gangs such as terrorists and violent extremist groups. Furthermore, as violent extremism and terrorist activities have become more prevalent in the West African sub-region it is crucial that these threats are considered when examining the functionality of Ghana’s border security. In an effort to improve awareness among border communities, the Center initiated the project entitled “Enhancing citizen participation in border security”. As part of the project strategies, a baseline survey was conducted within selected border communities to assess the level of awareness regarding border-related threats and gather information on the relationship between border residents and security agencies. The baseline survey was intended to inform the direction and interventions of the broader project. Both border residents and staff of some security agencies were interviewed in each of the 10 regions within where Ghana’s land borders are located. The findings of this survey are contained in this report.
Topic:
Security, Development, Terrorism, Borders, Smuggling, and Survey
Political Geography:
Africa and Ghana

39. Institutionalizing Downward Accountability: The Bangladesh Experience

Author:
Shaheen Anam
Publication Date:
02-2023
Content Type:
Commentary and Analysis
Institution:
East Asia Institute (EAI)
Abstract:
In this issue briefing, Shaheen Anam, Executive Director at Manusher Jonno Foundation, explores the challenges of institutionalizing downward accountability and assesses how such difficulties are projected in development projects of various sizes. Anam argues that effective bottom-up planning requires expertise of stakeholders, strong political will from above, and most importantly, active participation of the local community. Through a Bangladesh case study, Anam offers a successful example of the civil society taking advantage of social accountability tools to channel its voice and improve the transparency of the authorities.
Topic:
Civil Society, Development, Government, Accountability, Institutions, and Transparency
Political Geography:
Bangladesh and South Asia

40. Who Learns More from Afar? Spatial Empirical Evidence on Manufacturing and Services

Author:
Nina Vujanović
Publication Date:
02-2023
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
This paper investigates spatial dependence of FDI knowledge spillovers in manufacturing and services using spatial panel techniques applied to the 2006-2014 Bureau Van Dijk’s Amadeus firm-level dataset for Croatia and Slovenia. The paper finds diverse results across the two sectors. The distance between regions does not hinder the absorption of foreign knowledge in manufacturing despite the strong market-stealing effects operating within regions as well as spatially. On the other hand, FDI knowledge spillovers decrease service productivity within regions, because of market-stealing effects operating strongly across a smaller geographical scale. However, its impact is lost as knowledge spillovers from more distant neighbours are accounted for, because the poaching of local labour is impeded by distance due to rising costs of labour mobility. The research indicates that for knowledge absorption, geographic distance plays differing roles in manufacturing and services, due to the different nature of the production process.
Topic:
Development, International Trade and Finance, Foreign Direct Investment, Manufacturing, Econometrics, and Competition
Political Geography:
Europe, Croatia, and Slovenia