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101. Gendered effects of climate and conflict shocks on food security in Sudan and the mitigating role of social protection

Author:
Aysegül Kayaoglu, Ghassan Baliki, and Tilman Brück
Publication Date:
12-2024
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Climate change and violent conflict are defining challenges of our time. However, it is not yet understood how they interact in shaping human welfare and food security, how their interaction shapes gendered outcomes, or how social protection systems can mitigate their impact. To address these knowledge gaps, we first examine how household food insecurity relates to conflict and climate shocks and whether these associations are gender-sensitive. Second, we test what mechanisms can reduce the negative impacts of these shocks. Our empirical analysis relies on novel survey data of 7,908 rural households collected across 14 states in Sudan in 2022. Sudan currently faces floods, droughts, and violent conflict affecting agricultural production and food supply. We find that climate shocks do not significantly affect food consumption scores (FCS), while exposure to violent conflict leads to a substantial decrease in FCS. Both productive and nonproductive assets increase FCS for all households, especially female-headed households. Longer distances to agricultural input and output markets correlate with lower FCS, particularly for maleheaded households. Women’s social group membership positively impacts on FCS for femaleheaded households. However, women do not receive additional benefits from other social networks during climate and conflict exposure, while male-headed households benefit from all types of social networks. Income diversification is identified as a key strategy for improving FCS, particularly for female-headed households during conflict. Informal cash transfers significantly improve FCS, especially for female-headed households. In contrast, formal cash transfers negatively correlate with FCS, although they positively impact on male-headed households during violent conflict. Overall, we recommend targeted social protection programmes that address gender disparities and enhance resilience among vulnerable populations.
Topic:
Climate Change, Food Security, Conflict, Gender, and Social Protection
Political Geography:
Africa and Sudan

102. Economic impacts of electricity supply shortages in South Africa

Author:
Hiroaki Suenaga
Publication Date:
12-2024
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This study examines the sectoral impacts of electricity supply shortages in South Africa, using the cost share information available from the 2015 social accounting matrix. A simulation conducted under each of two technological assumptions, Cobb-Douglas and Leontief, reveals that a productivity decline in the electricity, gas, steam, and hot water supply (EGSH) sector increases the price of the EGSH sector substantially, while it affects the other sectors marginally due to the small cost shares of the EGSH factor in these sectors. The total cost of supplying the baseline final demand increases by ZAR19 billion or 0.46% of the baseline gross value added (GVA) when EGSH productivity declines by 10%. This cost impact expands to ZAR150 billion or 3.57% of GVA when EGSH productivity is halved. Large shares of these cost increments are incurred by the EGSH and manufacturing sectors, owning to the direct physical impact of productivity decline for the former and a large share of its sectoral GVA in the aggregate economy for the latter. The simulation also indicates that the equilibrium wage should increase by a greater extent for workers with a lower education than for those with a higher education if the baseline final demands are to be met at the higher EGSH output price after the sector’s productivity decline
Topic:
Economy, Manufacturing, Electricity, Supply, and Productivity
Political Geography:
Africa and South Africa

103. The gendered effects of climate shocks on labour and welfare in Zambia

Author:
Alessandra Hidalgo-Arestegui, Patricia Justino, Gabriel Monteiro, Rodrigo Oliveira, and Bruce Sianyeuka
Publication Date:
12-2024
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper exploits several waves of two major nationwide representative surveys to document the impacts of climate shocks on individuals and households in Zambia. We merge these datasets with historical precipitation and temperature data at the district level. First, we show the gendered effects of the shocks, which have a higher negative impact on women. Women have a lower probability of being in the labourforce and fewer hours of work when experiencing shocks. Second, we show that households affected by climate shocks have 16% lower consumption, which is mainly explained by female-headed households. We show that social protection policies mitigate income reduction but not consumption, which may suggest that climate shocks affect households directly by reducing their income, but also indirectly by raising food prices.
Topic:
Climate Change, Labor Issues, Consumption, Gender, and Climate Shocks
Political Geography:
Africa and Zambia

104. Raindrop in the drought? Vulnerability to climate shocks and the role of social protection in Zambia

Author:
Katrin Gasior, Pia Rattenhuber, Adnan Shahir, and Anna Zasova
Publication Date:
12-2024
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Zambia’s reliance on rain-fed agriculture makes its economy and population highly vulnerable to frequent droughts and irregular rainfall. This paper assesses the role of social protection, specifically the Social Cash Transfer (SCT) program, in mitigating drought-induced poverty and consumption declines. Using the MicroZAMOD microsimulation model and districtlevel rainfall data, we find that rainfall shocks significantly increase poverty and reduce household consumption, disproportionately affecting the poorest households. While the current SCT program provides some relief, reforms to eligibility criteria, particularly removing the household composition requirement, could improve targeting, expand coverage, and strengthen resilience against climate-related economic shocks.
Topic:
Agriculture, Climate Change, Tax Systems, Vulnerability, and Social Protection
Political Geography:
Africa and Zambia

105. Tax financing options for new social protection instruments: The equity implications of taxing more to expand the South African social security system

Author:
Maya Goldman and Ntuthuko Hlela
Publication Date:
09-2024
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
In this paper, we use a static fiscal incidence analysis model to evaluate the poverty and inequality impacts of using fiscal policy to finance expanded social spending in South Africa. We assess three methods to enhance the social protection system’s equity objectives: increasing the size and/or coverage of the existing Social Relief of Distress grant and introducing a universal or working-age basic income grant. The implications of financing these reforms are examined using four tax instruments: increasing the value-added tax rate, increasing personal income tax rates, reducing the personal income tax primary annual rebate, and introducing a surcharge on incomes. While we discuss behavioural effects, they are not included in the model. Our analysis indicates that an expansion of the social security system financed through increased taxation could substantially reduce poverty and inequality to varying degrees depending on the taxes and transfers used.
Topic:
Poverty, Inequality, Tax Systems, Fiscal Policy, Social Spending, and Cash Transfers
Political Geography:
Africa and South Africa

106. The sustainability of South African fiscal policy

Author:
Philippe Burger
Publication Date:
09-2024
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The public-debt-to-GDP ratio in South Africa increased from 26 per cent in the 2008/09 fiscal year to 73.9 per cent in 2023/24, raising fears that fiscal policy is not sustainable. This raises the question: did the government take steps to arrest the increase in the debt-to-GDP ratio and regain fiscal sustainability, and if so, why did they fail? Establishing fiscal sustainability can be done directly or indirectly. Doing it directly entails the government increasing the primary balance in reaction to higher debt levels. Hence, this paper presents a fiscal reaction function. The analysis shows that during the period in which the public-debt-to-GDP ratio rose, the primary balance did indeed react to an increased debt burden, but its level remained too low to arrest the increase in the public-debt-to-GDP ratio. The analysis also assesses whether fiscal fatigue set in, wherein the responsiveness of the primary balance to the debt burden is positive but eventually weakens. Some evidence for the presence of fiscal fatigue is present. One indirect approach to establishing fiscal sustainability is through the impact of expenditure and revenue on economic growth. Leaving revenue for further study later, this paper presents an adapted growth equation to investigate the impact on growth of general government investment and consumption expenditure, and of public (and private) corporation investment. While the effect of private sector investment is positive, neither general government nor public corporation investment has a statistically significant impact on growth. Furthermore, government consumption has a negative impact on growth.
Topic:
Investment, Fiscal Policy, Deficit, Sustainability, and Public Debt
Political Geography:
Africa and South Africa

107. Spatial consumption inequality in Mozambique

Author:
Carlos Gradín
Publication Date:
10-2024
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
In this paper, I show that the trend in spatial inequality in Mozambique almost entirely explains the outstanding surge in inequality in the country over the past decade, as well as its decline immediately after the pandemic, in contrast to its secondary role in the earliest years. For this analysis, I use an innovative regression-based decomposition framework based on the Recentred Influence Function to estimate each area’s contribution to inequality and a Blinder– Oaxaca approach to disentangle the nature of their contribution to spatial and non-spatial inequality trends. This rise in inequality was mainly due to a generalized drop in consumption experienced by households in the afflicted rural areas in the north and centre of the country, affected by natural disasters and growing conflict. This was aggravated by disproportionally larger economic growth in two urban areas: the Maputo area, which encompassed the capital, during the expansive phase, and the urban area of coal-rich Tete province during the recession that followed. In more recent years, the crisis disproportionally affected the capital and other urban areas, producing a strong mitigating effect on inequality that might be only temporary. The findings of this research have the potential to significantly inform policy decisions to address inequality in Mozambique, thereby contributing to the country’s economic development substantially.
Topic:
Inequality, Urban, Rural, and Economic Development
Political Geography:
Africa, Mozambique, and Sub-Saharan Africa

108. Spillover effects of the recent US monetary policy shocks on the South African economy: The role of monetary and fiscal policy coordination

Author:
Guangling Liu and Marrium Mustapher
Publication Date:
11-2024
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This study examines how different policy mix regimes affect the impact of recent US contractionary monetary policy on South Africa’s inflation and business cycles. The study uses a small open economy New Keynesian Dynamic Stochastic General Equilibrium model with an integrated fiscal block to analyse these effects. Regime M (active monetary policy) is more effective at containing the spillover effects but leads to higher public debt, requiring larger future fiscal surpluses. The commitment to price stability under Regime M increases real interest rates, raising domestic debt service costs and the debt-to-GDP ratio. Regime F (active fiscal policy), in contrast, stabilizes debt more quickly but at the cost of higher inflation, as it does not use future surpluses to manage public debt. These spillover effects are more amplified under both Regime M and Regime F in the case of a complete exchange rate pass-through and a higher degree of trade openness, with Regime F exhibiting a stronger amplification effect.
Topic:
Foreign Policy, Economics, Monetary Policy, Inflation, and Fiscal Policy
Political Geography:
Africa, South Africa, North America, and United States of America

109. Dancing on the grid: electricity crises, manufacturing energy vulnerability, and jobs in South Africa

Author:
Gideon Ndubuisi, Elvis Korku Avenyo, and Rex Asiama
Publication Date:
06-2024
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
South Africa’s current electricity crises have worsened, placing the country on an uncertain and turbulent economic trajectory. To identify the manufacturing sub-sectors that are most vulnerable to this crises, we use the input–output matrices for the period between 1993 and 2021 to develop a sub-sector energy vulnerability index. Second, we employ the self-constructed energy vulnerability index in a flexible empirical framework to examine the effect of the electricity crises on manufacturing sector jobs in the country. We find that energy vulnerability has a high degree of heterogeneity across manufacturing sub-sectors, highlighting cross-sector differences in the level of exposure and susceptibility to the energy-related crises. Results from the empirical analysis, on the other hand, suggest that electricity crises are associated with significant job destruction, with this adverse effect severe for manufacturing sectors with higher energy vulnerability intensity. The severity of this adverse effect holds irrespective of the nature of jobs, whether formal or informal.
Topic:
Crisis Management, Manufacturing, Electricity, Vulnerability, and Jobs
Political Geography:
Africa and South Africa

110. Economic geography determinants of spatial wage disparities in South Africa: Evidence from a firm‐level panel

Author:
Sanduku Mulumba, Lawrence Edwards, and David Fadiran
Publication Date:
08-2024
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
In this paper, we use the new economic geography (NEG) framework to estimate the extent to which spatial wage disparities in the South African manufacturing sector are an outcome of economic forces such as market access. To test the relationship, we use the anonymized tax data on employers and employees made available by the South African Revenue Service and National Treasury in collaboration with UNU-WIDER. We first document the key stylized facts that characterize the spatial distribution of wages across regions in South Africa using exploratory spatial data analysis (ESDA) techniques. We then test for the existence of a wage structure across South African local and metropolitan municipalities, controlling for individual and firm characteristics using a two-stage estimation method. Consistent with the NEG predictions, we find that wages are higher in municipalities that are closer to large markets, as measured by the Harris market potential index. However, much of the wage effect is driven by the income and employment density of the municipality’s own market, and not that of surrounding areas. These results point to a combination of large spatial rigidities leading to highly localized effects of market potential, together with wage and productivity effects arising from urban agglomeration economies.
Topic:
Economics, Manufacturing, Wages, and Market Access
Political Geography:
Africa and South Africa

111. Factors Influencing the Probability of Being Left Behind: A Multidimensional Poverty Approach for Botswana

Author:
Khaufelo R. Lekobane
Publication Date:
07-2024
Content Type:
Working Paper
Institution:
Botswana Institute for Development Policy Analysis
Abstract:
The Leave No One Behind principle is an important dimension of the 2030 Agenda for Sustainable Development. It recognises data disaggregation as a vital tool to identify the multidimensionally poor (those left behind). Using the 2015/16 Botswana Multi-Topic Household Survey, we investigate factors influencing the probability of being left behind. We define those left behind as the multidimensionally poor. We employed the multidimensional poverty measure to identify those left behind. Our study uses several econometric estimation techniques, such as Tobit, quantile regression and OLS regression models, in addition to the binary logit model commonly used in the empirical literature. The results reveal that an individual’s age, disability status, citizenship, sex of household head, marital status, education, employment status of household head, household wealth status and place of residence are significant factors influencing the probability of being left behind (multidimensionally poor). Policymakers should design context-specific, action-oriented and nationally appropriate policies and programmes that consider factors influencing the probability of being left behind and promote sustainable and inclusive development.
Topic:
Poverty, Sustainable Development Goals, and Regression Analysis
Political Geography:
Africa and Botswana

112. Understanding electricity utilities in sub-Saharan Africa: The role of civil society in improving performance, governance, and accountability

Author:
Peter Twesigye
Publication Date:
08-2024
Content Type:
Working Paper
Institution:
Oxfam Publishing
Abstract:
This report provides a primer on the performance of electricity utilities in sub-Saharan Africa, reflecting on the current landscape of power sector and utility challenges, the reforms undertaken to address performance failures, opportunities for a “utility of the future” amid the global energy transition, governance frameworks available to assess performance (like the infrastructure regulatory system and World Bank’s Utility Performance and Behavior Today [UPBEAT] platform), and the prospects for changing the political economy of state-owned utilities to significantly improve transparency, accountability, and performance. It provides foundational knowledge on how to use financial statements and economic tools so that nonexperts can assess the financial health of a utility for the purposes of demanding greater accountability. It also provides insights on why energy sector power purchase agreements (PPAs) should be made more transparent for greater public accountability. Further, the primer lays out the need for an enhanced role of civil society in advocating for improved transparency and greater civil participation in the governance of state-owned utilities and how regulation can be of further help. The key takeaway is that state-owned enterprises should be subject to commercial governance arrangements, including mandatory and stringent contracts and exposure to some private capital as well as stakeholder annual general meetings, open to the public, similar to those that occur in the private sector. This report complements three other reports published for Ghana, Kenya, and South Africa. Each of those reports focuses on understanding the specific governance conditions surrounding their respective national electricity utilities. All these reports together are intended to build the programmatic and campaigning capacity among civil society actors to enable them to engage in improving the governance of electricity utilities. As such, the intended audience for this report is, first, members of civil society, and then policymakers and energy sector practitioners who are concerned about the operations of their national electricity utilities and who are contemplating advocacy and programming to improve their performance.
Topic:
Civil Society, Climate Change, Governance, Electricity, Utilities, and Energy
Political Geography:
Africa and Sub-Saharan Africa

113. Beyond GDP: A compendium of regional feminist perspectives

Author:
Jennifer Lipenga, Lumonya Faith, Samia al-Botmeh, Nalini Rathnarajah, and Natalia Quiroga Diaz
Publication Date:
12-2024
Content Type:
Working Paper
Institution:
Oxfam Publishing
Abstract:
In this publication, leading feminist thinkers from Africa, the Middle East and North Africa, South Asia, Latin America and the Caribbean, share perspectives on why we must move beyond gross domestic product (GDP) as the primary measure of societal progress. Drawing on regional examples, they demonstrate how the GDP-growth obsession is skewing policy-making towards measures that drive austerity, debt, corporate power, and exploitative labour practices, whilst invisibilising unpaid care and domestic work. In a call to action, the authors highlight Indigenous and feminist alternatives that need to be pursued to catalyse a shift towards economies that centre care of people and the planet.
Topic:
GDP, Feminism, Decolonization, and Systems Change
Political Geography:
Africa, South Asia, Middle East, Latin America, North Africa, and Caribbean

114. UN Support to African Union–Led Peace Support Operations: What Next for Resolution 2719?

Author:
Bitania Tadesse and Jenna Russo
Publication Date:
09-2024
Content Type:
Working Paper
Institution:
International Peace Institute (IPI)
Abstract:
UN Security Council Resolution 2719, passed in December 2023, represents a significant milestone in providing predictable and sustainable financing for African Union (AU)–led peace support operations (PSOs). The resolution allows AU missions to receive up to 75 percent of their budget from UN assessed contributions, regularizing a process that had previously been granted on a case-by-case basis. This resolution strengthens the UN-AU partnership and aims to streamline joint planning and mission authorization processes between the UN Security Council and AU Peace and Security Council. Yet gaps remain when it comes to the interpretation of the resolution, and the two organizations need to do significant work to operationalize the joint efforts it outlines. This policy report considers what comes next for implementing Resolution 2719, including areas of the resolution that require further clarification. It also explores the types of coordination mechanisms and decision-making frameworks needed to effectively operationalize the resolution. Finally, it analyzes potential test cases for implementing Resolution 2719, including Somalia, the Democratic Republic of the Congo (DRC), and Sudan. The paper recommends several steps to strengthen the implementation of Resolution 2719, including finalizing joint planning guidelines, addressing the financing gap, and building the capacity of AU departments responsible for peace support operations. Both the UN and AU should also focus on creating a more efficient joint budgeting process and ensuring that the regulations align with AU-led missions’ needs. These efforts will help ensure that Resolution 2719 becomes a functional and reliable framework for future peace operations in Africa.
Topic:
United Nations, Peacekeeping, UN Security Council, and African Union
Political Geography:
Africa

115. Enhancing Women’s Meaningful Involvement in Reintegration: Lessons from Cameroon

Author:
Evyn Papworth
Publication Date:
12-2024
Content Type:
Working Paper
Institution:
International Peace Institute (IPI)
Abstract:
Gender-sensitive approaches to disarmament, demobilization, and reintegration (DDR) processes tend to focus on the exclusion of women as participants in DDR programs. There has been less attention to including women’s civil society organizations (CSOs) in the design and implementation of DDR programs. One recent effort to involve women’s CSOs in reintegration was a project led by the National Disarmament, Demobilization, and Reintegration Committee (NDDRC) of Cameroon, the International Organization for Migration (IOM), and UN Women. Funded by the Gender and Youth Promotion Initiative (GYPI), this project focused on enhancing women’s roles in the reintegration aspect of DDR. This project highlights both the benefits and the challenges of including women’s CSOs in reintegration processes. This policy paper analyzes the gendered considerations and lessons learned for engaging women’s CSOs in the implementation of reintegration programming in the Far North of Cameroon. Over the course of the project, the engagement of women’s CSOs has evolved as they received capacity building on reintegration and education on the DDR process in Cameroon. Although the long-term impact of the project remains to be seen, this changing engagement has created a potential entry point to facilitate a shift in societal gender dynamics. The paper concludes with recommendations aimed at ensuring that reintegration processes are not only more gender-responsive but also lead to more sustainable outcomes: Develop a gender strategy as part of the overall DDR strategy Establish an infrastructure for systematic and sustained collaboration with civil society Invest in women’s CSOs’ long-term capacity to support reintegration Communicate details on the operationalization of the DDR process so that CSOs are set up for success Consider the role of masculinities when developing DDR gender strategies Anticipate and proactively address safety risks facing women’s CSOs supporting reintegration
Topic:
Disarmament, Reintegration, Peacebuilding, Women, Peace, and and Security (WPS)
Political Geography:
Africa and Cameroon

116. Climate action in Sub-Saharan Africa: Trends in NDCs

Author:
Ole Winckler Andersen and Rasmus Hundsbæk Pedersen
Publication Date:
11-2024
Content Type:
Working Paper
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
All countries in Sub-Saharan Africa have submitted Nationally Determined Contributions (NDCs) as part of their respective commitments to climate action, and it is envisaged that the financing of these NDCs will be an important issue at the negotiations at the upcoming COP29 in Baku. While various analyses have documented and analysed the significant differences in countries’ NDCs, there has only been a limited focus on this aspect of African countries’ NDCs or on the role NDCs play in these countries. This paper addresses this issue by exploring common trends and differences in the NDCs of countries in Sub-Saharan Africa and discusses some potential explanations. The paper argues that the contents of these NDCs are not only influenced by climate-change considerations but also by a complex set of national and international factors. A better understanding of the differences between them in Sub-Saharan Africa is needed, including of the extent to which the NDCs constitute commitment or negotiation positions of the countries.
Topic:
Climate Change, Negotiation, Conference of the Parties (COP), and Nationally Determined Contributions (NDCs)
Political Geography:
Africa and Sub-Saharan Africa

117. Climate finance in East Africa

Author:
Tallulah Cherry-Virdee, Josephine Nyamai Warunge, and Hans Peter Dejgaard
Publication Date:
10-2024
Content Type:
Working Paper
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
Highly vulnerable to climate change and already facing significant climate impacts, the countries of East Africa require both domestic and international climate finance to meet their climate goals, adapt to the impacts of climate change and build resilience. This study analyses the public international climate-related development finance reaching Tanzania, Kenya and Uganda, the three largest countries in the East Africa region, with a focus on the quantity of and trends in commitments of adaptation-related development finance, including the channel of delivery, sectors targeted, type of financial instrument and the grant equivalence of concessional climate loans. The paper is an initial outcome of the four-year research programme (2021-2025) Governing Adaptation Finance for Transformation (GAP) involving collaborating research institutions in Denmark, Kenya and Tanzania. Analysis is based on the OECD’s climate-related development finance dataset for the period 2015-2022. Findings are discussed with regard to the countries’ climatic, economic and sociopolitical contexts including indebtedness and risk of debt distress, climate projections and impacts, and the policies, laws, regulations and strategies that have been developed to direct adaptation and mitigation efforts and mobilise finance to support measures. This leads to five key conclusions regarding the amount of adaptation-related development finance committed, the channel of delivery and degree of devolution, the financial instruments used for adaptation-related development finance, the gender responsiveness of adaptation-related development finance and climate finance tracking and reporting.
Topic:
Environment, Natural Resources, Economy, and Development Policy
Political Geography:
Uganda, Kenya, Africa, and Tanzania

118. New data on climate, mobility and social cohesion

Author:
Francis Jarawura and Lily Salloum Lindegaard
Publication Date:
09-2024
Content Type:
Working Paper
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
We are currently witnessing complex interactions between climate change, development and security challenges, and social relations in many contexts globally. Programming focusing on these issues, especially with a focus on social cohesion, is rapidly expanding. However, data on the linkages between these dynamics is extremely limited. This working paper shares unique data documenting these linkages in Ghana and Niger. The working paper shares data from the study ‘Displacement, climate change and social cohesion: exploring loss and damage dynamics’, a collaboration between the Danish Institute for International Studies and the Danish Red Cross as well as research partners in Ghana and Red Cross partners in Niger. It presents qualitative and quantitative results from data collection in the Upper West Region of Ghana and the Tillabéri Region of Niger, where livelihoods are under pressure due to environmental, development and security challenges and forced mobility is widespread. By sharing these results, we seek to make this unique data available for practitioners and researchers, as well as other interested parties, for further use. The study ‘Displacement, climate change and social cohesion: exploring loss and damage dynamics’ explored changes in social relations and social cohesion in relation to climate change and forced mobility. It took a loss and damage perspective, seeking to understand how those affected by climate change and forced mobility may have experienced losses to social cohesion, and what impacts that has had on their well-being more broadly. Analysis of the data can be found in the DIIS Report Loss, damage and social cohesion: impacts and next steps for policy and programming and the DIIS Policy Brief ‘Losses and damages to social cohesion are overlooked’.
Topic:
Security, Climate Change, Development, Mobility, and Social Cohesion
Political Geography:
Africa, Ghana, and Niger

119. Enhancing Data Sharing Practices Between Government Agencies

Author:
Sone Osakwe
Publication Date:
03-2024
Content Type:
Working Paper
Institution:
Centre for the Study of the Economies of Africa (CSEA)
Abstract:
In today's fast-paced world, access to accurate and timely data is crucial for effective governance and decision-making. Policymakers often struggle to access the data they need to make informed decisions and serve the public effectively. The problem lies not in the lack of available data but in its inaccessibility. Unfortunately, many government ministries, departments, and agencies (MDAs) in African countries face challenges when it comes to sharing and integrating data. This lack of data interoperability hampers collaboration, slows down processes, and prevents the delivery of efficient public services.
Topic:
Governance, Data, Public Service, and Decision-Making
Political Geography:
Africa

120. Debt for Climate and Development Swaps in Nigeria

Author:
Mma Amara Ekeruchera, Chris Heitzig, Oreoluwa Adenuga, Oludele Folarin, and Kashema Bahago
Publication Date:
06-2024
Content Type:
Working Paper
Institution:
Centre for the Study of the Economies of Africa (CSEA)
Abstract:
Africa’s largest economy has found itself in an increasingly vulnerable financial position due to several shocks in the past decade. It relied on private creditors to compensate for revenue shortfalls in 2016 and 2017 after the collapse of commodity prices. The COVID-19 pandemic induced more borrowing, this time from multilateral sources. These events have led to the highest external debt levels in Nigeria since 2004. Increased debt levels clogged financing for key SDG outcomes relating to social welfare sectors more broadly and gender equality and the environment in particular. This paper explored the need for, viability of, and impacts of debt swaps in Nigeria. It focused on two sources of debt that are mostly likely to be involved in a debt swap: Paris Club ODA debt and underperforming private sector debt. These two sources together comprise a sum of more than $3.7 billion whose exchange could free up resources to fund development priorities for facilitators of the debt swap. If the entirety of the eligible debt were to be swapped, it would create an average of nearly $300 million of budgetary resources (per year) for the next six years. Beyond funding development projects, remaining funds could decrease the debt burden, provided they do not beget additional borrowing. The paper also traced the experiences of five countries participating in debt-for-nature swaps.
Topic:
Climate Change, Debt, Development, Economy, Sustainable Development Goals, Commodities, and Revenue
Political Geography:
Africa and Nigeria

121. How Neoliberalism Has Wielded ‘Corruption’ to Privatise Life in Africa

Author:
Tricontinental: Institute for Social Research
Publication Date:
11-2024
Content Type:
Working Paper
Institution:
Tricontinental: Institute for Social Research
Abstract:
In Africa, the leading forces of capitalism have ruthlessly wielded a neoliberal conception of corruption to undermine states’ sovereignty and open the continent to plunder at the hands of Western multinational corporations.
Topic:
Corruption, Privatization, Sovereignty, Capitalism, Neoliberalism, and Multinational Corporations
Political Geography:
Africa

122. What’s Wrong with the DRC Constitution?

Author:
Erik Kennes
Publication Date:
12-2024
Content Type:
Working Paper
Institution:
EGMONT - The Royal Institute for International Relations
Abstract:
Within the DRC a fierce debate is raging about President Tshisekedi’s ambition to modify or to replace the current constitution. But why? And why now? The arguments to justify the change are far from clear. During an August 2023 interview, President Tshisekedi pointed at elements of the constitution which allegedly cause malfunctioning of the state. During a speech held in Kisangani on 23 October President Tshisekedi qualified the 2006 constitution as “written by foreigners” and “not adapted to the situation of the DRC”. In Lubumbashi on 16 November, Tshisekedi again took up the subject and stated that the constitution’s included a provision which, according to the DRC President, “enshrines the sale of our sovereignty to African states” (meaning Rwanda). The current constitution was adopted by referendum on 18-19 December 2005 by an 84,3 % majority of the valid votes cast. In the President’s view, his election in December 2023 with a score of 72% provides him with the necessary legitimacy to replace or at least to modify it. Tshisekedi’s position on the issue of constitutional change evolved from evoking the possibility to an absolute determination to modify or rather to replace the current constitution. He threatened to bring before justice anyone who tried to “manipulate the population” and create conflicts by criticizing his project – suggesting that “manipulation” meant refusing constitutional change. In fact, the push for a modified or new constitution creates conflicts because many consider that there are currently far more important priorities. The weakness of the arguments from the President will be discussed below. Many fear that the real objective of constitutional change is for the current regime to remain in power for decades. This does not imply that a debate about constitutional change is meaningless: there are substantial arguments about possible improvements that may be considered. But the current situation of the country, with important problems of governance and security (including the war in East Congo with occupation of national territory) does not allow for a calm and balanced debate about such fundamental issues.
Topic:
Reform, Constitution, Domestic Politics, and Felix Tshisekedi
Political Geography:
Africa and Democratic Republic of the Congo

123. Factors Influencing the Probability of Being Left Behind: A Multidimensional Poverty Approach for Botswana

Author:
Khaufelo R. Lekobane
Publication Date:
07-2024
Content Type:
Working Paper
Institution:
Botswana Institute for Development Policy Analysis
Abstract:
The Leave No One Behind principle is an important dimension of the 2030 Agenda for Sustainable Development. It recognises data disaggregation as a vital tool to identify the multidimensionally poor (those left behind). Using the 2015/16 Botswana Multi-Topic Household Survey, we investigate factors influencing the probability of being left behind. We define those left behind as the multidimensionally poor. We employed the multidimensional poverty measure to identify those left behind. Our study uses several econometric estimation techniques, such as Tobit, quantile regression and OLS regression models, in addition to the binary logit model commonly used in the empirical literature. The results reveal that an individual’s age, disability status, citizenship, sex of household head, marital status, education, employment status of household head, household wealth status and place of residence are significant factors influencing the probability of being left behind (multidimensionally poor). Policymakers should design context-specific, action-oriented and nationally appropriate policies and programmes that consider factors influencing the probability of being left behind and promote sustainable and inclusive development.
Topic:
Poverty, Sustainable Development Goals, and Regression Analysis
Political Geography:
Africa and Botswana

124. Harnessing Mice for Zambia's Tourism Sector Growth

Author:
Emmanuel Muma, Kalemba Mpandamwike, and Uchinvio Nakazwe
Publication Date:
09-2024
Content Type:
Working Paper
Institution:
Zambia Institute for Policy Analysis and Research (ZIPAR)
Abstract:
MICE (Meetings, Incentives, Conferences, and Exhibitions) tourism represents a critical component of the global tourism industry, with MICE travelers’ spending margins estimated to be 2 to 5 times higher than those of average leisure travelers2 . MICE travelers, often with expenses covered by employers, exhibit greater budget flexibility, leading to higher spending on accommodations, dining and shopping. A global overview of the MICE tourism industry, according to Business Insider, projects it to reach USD 1,439 billion by 2025, growing at a compound annual growth rate (CAGR) of 7.6 percent from 2018 to 20253 . Prioritizing MICE development is essential for stimulating local economies, creating employment opportunities, and enhancing domestic revenue mobilization. This report presents a comprehensive analysis of Zambia’s potential to emerge as a prominent destination for Meetings, Incentives, Conferences, and Exhibitions (MICE). An in-depth analysis has shown that Zambia has the potential to become a successful MICE destination. The total revenues from tourism sources which encompass business tourism (MICE) have shown a strong upward trend, growing from K 178.24 million in 2021, to K 298.55 million in 2023, representing 67.49 percent increase from 2021 to 2023.
Topic:
Tourism, Employment, Economic Growth, and Travel
Political Geography:
Africa and Zambia

125. An Overview of the African Peacebuilding Network’s (APN’s) Contribution to African Peacebuilding Literature

Author:
Godwin Onuoha
Publication Date:
05-2023
Content Type:
Working Paper
Institution:
Social Science Research Council
Abstract:
This working paper surveys, documents, and analyzes the contributions of APN scholars to the knowledge and practice of peacebuilding in Africa against the background of the 10th year anniversary of the APN program. It takes stock of the contributions and impact of the literature produced by APN scholars, particularly how these have brought different interdisciplinary perspectives and novel methodological approaches to bear on African peacebuilding. The paper systematically analyzes African perspectives on peacebuilding, debates between different schools of thought, provides an overview of different publications by APN scholars, and synthesizes the significance of these contributions to discourses on African and global literature on peacebuilding. As part of a broader intellectual project, the publications demonstrate how APN scholars have forged a nexus at which one can explore conflict, peacebuilding, media, gender, youth, boundaries and borderlands, land grabs, migration and refugees, faith-based initiatives, local/ communal cultures, identities, and COVID-19, among other topics. The publications under review transcend the narrow confines of the literature to engage in the complexities and multidimensional nature and contexts of African peacebuilding. In this regard, the publications mainstream African agency and views, particularly in the production of African knowledge in the field of peacebuilding.
Topic:
Conflict, Literature, Peacebuilding, and Transdisciplinarity
Political Geography:
Africa

126. Regional Development and Internal Migration Aspects of Structural Transformation: A Case Study of Senegal

Author:
Askar Mukashov
Publication Date:
10-2023
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
This study investigates regional development and internal migration dynamics within the context of modern structural transformation in Sub-Saharan Africa. We develop a regionalized Computable General Equilibrium model that incorporates regionalized production, endogenous interregional migration, and distinct migrant households. Using this model, we simulate the structural transformation of Senegal as a case study. Our findings demonstrate that agricultural stagnation, exacerbated by global climate change, underlies the economic underperformance of rural regions and amplifies regional income disparities. Furthermore, our analysis shows that outmigration from stagnating rural provinces to a more developed capital region positively influences overall economic growth and mitigates regional income inequality. Nevertheless, these effects are limited, and a proactive approach to addressing income inequality across the nation's regions would require supporting agriculture, as it represents a more equitable policy than promoting nonagricultural sectors in both rural and capital regions.
Topic:
Climate Change, Migration, Economic Growth, Labor Market, and Regional Development
Political Geography:
Africa

127. China as an International Lender of Last Resort

Author:
Sebastian Horn, Bradley C. Parks, Carmen M. Reinhart, and Christoph Trebesch
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
This paper shows that China has launched a new global system for cross-border rescue lending to countries in debt distress. We build the first comprehensive dataset on China’s overseas bailouts between 2000 and 2021 and provide new insights into China’s growing role in the global financial system. A key finding is that the global swap line network put in place by the People’s Bank of China is increasingly used as a financial rescue mechanism, with more than USD 170 billion in liquidity support extended to crisis countries, including repeated rollovers of swaps coming due. The swaps bolster gross reserves and are mostly drawn by distressed countries with low liquidity ratios. In addition, we show that Chinese state-owned banks and enterprises have given out an additional USD 70 billion in rescue loans for balance of payments support. Taken together, China’s overseas bailouts correspond to more than 20 percent of total IMF lending over the past decade and bailout amounts are growing fast. However, China’s rescue loans differ from those of established international lenders of last resort in that they (i) are opaque, (ii) carry relatively high interest rates, and (iii) are almost exclusively targeted to debtors of China's Belt and Road Initiative. These findings have implications for the international financial and monetary architecture, which is becoming more multipolar, less institutionalized, and less transparent.
Topic:
Debt, Emerging Markets, International Trade and Finance, Financial Crisis, Belt and Road Initiative (BRI), and Sovereign Debt
Political Geography:
Africa, China, and Asia

128. Patterns of Global and Regional Value Chain Participation in the EAC

Author:
Sebastian Krantz
Publication Date:
02-2023
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
Using global Multi-Region Input-Output (MRIO) data from 2005-2015, this paper empirically investigates the extent and patterns by which East African Community (EAC) countries have integrated into Global Value Chains (GVCs) and Regional Value Chains (RVCs). Results imply that the foreign content of exports (I2E) and the share of exports being re-exported (E2R) are stably between 10% and 20% in most EAC countries. Trade in intermediates with the rest of the world remains 12-14 times greater in value-added (VA) terms than the trade in intermediates inside the EAC. During 2005-2015, Kenya expanded its role as a regional supplier of manufactured inputs (higher E2R with EAC partners), and Uganda slightly increased its agricultural input to the Kenyan and Rwandan food processing sectors. Overall, however, a downstream shift is evident, by which more VA (both domestic and foreign) is used for the production of final goods while maintaining high levels of exports in primary agriculture and mining. This shift goes alongside a loss of comparative advantage in manufacturing in all EAC countries apart from Kenya. Econometric analysis suggests that higher I2E and E2R shares increase GDP with an average elasticity of ≥ 0.25 over 2 years. Estimates for manufacturing sectors were slightly higher at elasticities ≥ 0.3 in response to E2R shifts. These results imply that policy measures to increase manufacturing competitiveness and promote more horizontal RVCs would benefit EAC economic growth in the medium run.
Topic:
Globalization, Regional Integration, and Global Value Chains
Political Geography:
Africa

129. Africa’s Businesswomen – Underfunded or Underperforming?

Author:
Charles Ackah, Holger Görg, Aoife Hanley, and Cecília Hornok
Publication Date:
03-2023
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
While the recent success of Africa’s ‘Lionesses’ – successful female entrepreneurs - is internationally celebrated, less is known about how liquidity can fuel the success of the ‘Lionesses’ and other businesswomen. Using information from a panel of over 800 male- and female-owned businesses in Ghana (ISSER-IGC survey), we capture a measure of underfunding, in addition to data on supplier credit, equity and other finance sources. Our regressions reveal a female-to-male productivity gap of between -11 to -19 percent, values similar to estimates for other African countries. However, when the relationship between gender and productivity is mediated by financial constraints, the gender performance gap disappears. Accordingly, female business-owners who indicate that funding is not a problem, are associated with higher productivity than males, all things equal. In a finding new to the literature, our regressions reveal the importance of supplier credit for Africa’s businesswomen.
Topic:
Globalization, International Trade and Finance, Women, Business, Productivity, and Liquidity
Political Geography:
Africa and Ghana

130. China’s Provinces as Global Actors: Evidence from China-Africa Relations

Author:
Charlotte Lenz
Publication Date:
01-2023
Content Type:
Working Paper
Institution:
LSE IDEAS
Abstract:
With the launch in the early 2000s of China’s ‘Going Global’ Strategy, Chinese provinces became one group of actors participating in China’s South-South relations. In this Strategic Update, Charlotte Lenz investigates the role of Chinese provinces as foreign policy actors and explains their internationalisation strategies, challenging the prevalent perception of China as a unitary actor on the world stage. Drawing on evidence from Africa-China relations, the report identifies two strategies employed by Chinese provinces in pursuit of their foreign policy interests: (1) Formal and informal “twinning” as a collaborative model between central and local actors, wherein central actors design policies and provincial governments execute projects; (2) and “clustering” according to a sectoral logic of investment and diplomacy in which a certain Chinese province engages a certain foreign country. Despite ongoing bureaucratic centralisation under Xi Jinping, provinces continue to pursue their own internationalisation strategies to help meet local economic and employment targets. Understanding their agency, interests and limitations is thus key to deriving a better understanding of China’s evolving global presence.
Topic:
Foreign Policy, Diplomacy, Bilateral Relations, Investment, and Internationalization
Political Geography:
Africa, China, and Asia

131. Growth Through Inclusion in South Africa

Author:
Ricardo Hausmann, Tim O'Brien, Andrés Fortunato, Alexia Lochmann, and Kishan Shah
Publication Date:
11-2023
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
It is painfully clear that South Africa is performing poorly, exacerbating problems such as inequality and exclusion. The economy’s ability to create jobs is slowing, worsening South Africa’s extreme levels of unemployment and inequality. South Africans are deeply disappointed with social progress and dislike the direction where the country seems to be heading. Despite its enviable productive capabilities, the national economy is losing international competitiveness. As the economy staggers, South Africa faces deteriorating social indicators and declining levels of public satisfaction with the status quo. After 15 years, attempts to stimulate the economy through fiscal policy and to address exclusion through social grants have failed to achieve their goals. Instead, they have sacrificed the country's investment grade, increasing the cost of capital to the whole economy, with little social progress to show for it. The underlying capabilities to achieve sustained growth by leveraging the full capability of its people, companies, assets, and knowhow remain underutilized. Three decades after the end of apartheid, the economy is defined by stagnation and exclusion, and current strategies are not achieving inclusion and empowerment in practice. This report asks the question of why. Why is the economy growing far slower than any reasonable comparator countries? Why is exclusion so extraordinarily high, even after decades of various policies that have aimed to support socio-economic transformation? What would it take for South Africa to include more of its people, capabilities, assets, and ideas in the functioning of the economy, and why aren’t such actions being undertaken already? The Growth Lab has completed a deep diagnostic of potential causes of South Africa’s prolonged underperformance over a two-year research project. Building on the findings of nine papers and widespread collaboration with government, academics, business and NGOs, this report documents the project’s central findings. Bluntly speaking, the report finds that South Africa is not accomplishing its goals of inclusion, empowerment and transformation, and new strategies and instruments will be needed to do so. We found two broad classes of problems that undermine inclusive growth in the Rainbow Nation: collapsing state capacity and spatial exclusion.
Topic:
Inequality, Economic Growth, Unemployment, and Inclusion
Political Geography:
Africa and South Africa

132. A Framework for a Win-Win Europe-Africa Energy and Climate Partnership

Author:
Marc-Antoine Eyl-Mazzega
Publication Date:
07-2023
Content Type:
Working Paper
Institution:
Institut français des relations internationales (IFRI)
Abstract:
North-South tensions are exacerbated at a time of unprecedented turmoil for both Europeans and Africans. European polycrises (geopolitical, energy-related and economic) echo the systematic vulnerability of Africans, which is reinforced by external shocks. Following a dialog of the deaf, with rising discontent, tensions, and misunderstandings on both sides, there is now a new phase of discussion, coordination, and cooperation to achieve very concrete, high-impact actions. Europeans and Africans need each other to advance the European energy transition on the one hand and make decisive and rapid progress toward achieving the SDGs on the other. The urgency and issues at stake are such that this opening window to change the dynamics and achieve major and rapid advances should not be missed. Key priorities for action include debt restructuring, reinforcing funding, de-risking investments into SDGs segments, new priorities for the energy and mining sectors, and fostering private investment. There has been progress on financial and economic issues at recent COPs, and at the June 2023 summit in Paris, calling for a New Global Financial Pact. But Europeans still need to reconsider and consolidate their approach to hydrocarbons, electricity, mining, and biodiversity, taking into account the expectations and needs of the countries concerned. The widespread electrical and energy poverty in sub-Saharan Africa is a mounting factor of instability and now requires a breakthrough and a careful balance between fossil fuels and low-carbon solutions. Would sub-Saharan Africa develop as Europe, Russia, China, or the United States did in the 20th century, all efforts to preserve the planet would be vain. In the electricity sector, given the immense hurdles that lie ahead, a key issue at stake is to de-risk investments, strengthen concessional finance and target it more effectively. Tools can be put in place quickly. States, for their part, need to strengthen their regulatory frameworks and modernize their national companies. Networks are a weak link and deserve to be supported by international financial institutions. In the field of hydrocarbons, where major upstream activity is taking place, increasingly to the benefit of resource holding nations, the challenge is to avoid any new resource curse, to multiply development opportunities, and to minimize social and environmental impacts. Solutions do exist, and all actors must now assume their responsibilities. The mining sector requires infrastructure of all kinds, as well as the progressive implementation of demanding ESG criteria to protect the environment and workers, while fostering local and national development. Europeans need to mobilize capital, build industrial alliances, help train workforces, and structure win-win projects which create jobs and infrastructure. In the field of biodiversity, a huge opportunity for action and development is opening up, provided that the integrity of certification mechanisms and governance at the local level are strengthened, involving all stakeholders in a transparent way. The energy transition envisaged in Europe is in no way transposable to sub-Saharan Africa, where the main challenges concern access to affordable energy and clean cooking, development, youth employment, and adaptation to climate change. A challenge for Europeans is to speed up processes and reinforce the ability to accompany multidimensional projects, and not to be too prescriptive, so as not to lose influence and attractiveness further. The taxonomy, non-financial disclosure rules, or ESG criteria matter of course, but require some flexibility, and to be included in a process or progressive convergence. Priorities should be refocused on rapidly ensuring overall access to clean cooking, which is the mother of all battles and a key to development and environmental preservation. All the required technologies and solutions are available, and Kenya, alongside a few other countries in the region, showcases strong progress. With relatively modest resources, this existential challenge could be decisively addressed. Then comes the issues of transmission and distribution grids, and the wider infrastructure. Against this backdrop, providing public support for hydrogen export projects in the region appears less of a priority for European capitals at this stage. Finally, the success of the current re-engagement between Europeans and Africans will very much also depend on the European Union’s ability to foster the decrease of its greenhouse gas emissions so as to make room for the inevitable rise of emissions in sub-Saharan Africa. Countries in the region need to improve governance and their investment frameworks to foster inclusive, sustainable, and stable economic growth and development, and avoid that all stops soon again. Yet these governments also need to raise the same demands and issues of climate justice to China, Russia, Middle East, or North American countries, which are the world’s largest polluters and are less committed than is Europe.
Topic:
European Union, Partnerships, Ecology, Energy, and Energy Transition
Political Geography:
Africa and Europe

133. Who Finances Energy Projects in Africa?

Author:
Oyintarelado Moses
Publication Date:
11-2023
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
Public and private energy finance to Africa from countries in the Group of Twenty (G20) and multilateral development banks (MDBs) from 2012 to 2021 totaled $345.76 billion, according to this paper’s findings. Amounting to an average of about $35 billion per year, this finance was within the estimated $31.5–$45 billion range necessary to address Africa’s annual energy finance gap. However, it was distributed unevenly, with ten countries receiving 77 percent of all finance over the ten-year period. Some inequity may be a consequence of differing domestic energy demands, investment environments, or natural resource endowments across countries. However, the resulting distribution of energy finance over the past decade was such that many African countries—home to hundreds of millions of people—were left with substantial gaps in their financing necessities. This paper also shows that only a few countries and multilateral financing entities—including China, France, Italy, the United States, and the World Bank Group—supplied the majority of energy finance to Africa between 2012 and 2021. In many ways, this finding is unsurprising; however, it serves as a reminder that significant amounts of energy finance are subject to the policies and priorities of a small number of countries and institutions. To that point, this paper demonstrates a near total retrenchment of funding for coal projects beginning around 2018, reflecting the policy priority among these major funders to stop financing overseas coal projects. Most of the $345.76 billion in energy finance for African countries went to projects with gas/liquefied natural gas (LNG), mixed fossil fuels, and solar energy sources. Of the total energy finance, $197.17 billion (57 percent) came from public institutions, while $148.59 billion (43 percent) came from private corporations. The paper identifies some important similarities and differences between public and private finance. Both streams were highly concentrated in terms of senders and recipients, though the recipients differed slightly. For both streams, gas/LNG projects received the most or nearly the most finance. Public finance was directed to projects with more diverse energy sources, but less of the financing was directed to solar and wind projects. Most of the private finance was directed to fossil fuel projects, but when compared to public finance, a higher proportion of private finance supported solar and wind projects. Overall, the average amount of energy finance commitments that flowed to Africa from 2012 to 2021 may have been within the range of estimated need, but the unequal distribution of this finance risked leaving many countries behind. The small number of major players on the supply side of energy finance also created the potential for volatility, as internal guidance on funding priorities among these senders could evolve over the coming years and decades. Policymakers in financing countries could therefore prioritize finance distribution based on annual demands from historically low-level recipients, diversify financiers by redirecting financing to African regional banks and investors, and use public finance to crowd in private finance to projects with high potential for energy access in Africa.
Topic:
Development, Finance, Investment, and Energy
Political Geography:
Africa

134. The politics of policy reform: Experimental evidence from Liberia

Author:
Wayne Aaron Sandholtz
Publication Date:
07-2023
Content Type:
Working Paper
Institution:
Nottingham Interdisciplinary Centre for Economic and Political Research (NICEP)
Abstract:
Public service reform often entails broad benefits for society and concentrated costs for interest groups. These groups’ political responses determine whether electoral incentives exist to improve public services. This paper examines the electoral effects of a randomized Liberian school reform which increased student learning but antagonized teachers. On average, this policy reduced the incumbent party’s presidential vote share by 3 percentage points (10%). It had no significant impact on legislative races, consistent with correct attribution by voters; information experiments with candidates and voters further suggest a well-informed electorate. The policy also reduced teachers’ job satisfaction by 0.18σ and lowered their participation in political activity by 0.22σ. I use the policy’s pairwise randomization to study how its electoral effects varied across the (orthogonal) distributions of treatment effects on student learning and teacher political activity. The policy increased vote share more where it caused greater student learning, and reduced vote share more where it caused greater political disengagement of teachers. (Treatment effects on student learning and teacher political involvement were uncorrelated.) Back-of-the-envelope calculations suggest that the policy could have won votes on net if the floor on learning effects had been the 27th percentile, and the floor on teacher political involvement effects had been the 30th percentile. This paper shows empirically that electoral rewards correlate with the size of public service improvements, but that politically feasible reforms must balance voter rewards with the costs of alienating interest groups.
Topic:
Reform, Elections, Public Service, and Political Participation
Political Geography:
Africa and Liberia

135. Rewarding allegiance: Political alignment and fiscal outcomes in local government

Author:
Christa N. Brunnschweiler and Samuel K. Obeng
Publication Date:
07-2023
Content Type:
Working Paper
Institution:
Nottingham Interdisciplinary Centre for Economic and Political Research (NICEP)
Abstract:
We examine how local governments’ political alignment with central government affects subnational fiscal outcomes. In theory, alignment could be rewarded for example with more intergovernmental transfers, or swing voters in unaligned constituencies could be targeted instead. We analyze data from Ghana, which has a complex decentralized system that seeks to preclude political alignment effects. District Chief Executives (DCEs) are centrally appointed local administrators loyal to the ruling party, while district Members of Parliament (MPs) may belong to another party. A formula for central transfer distribution aims to limit the influence of party politics. Using a new dataset for 1994-2018 and a close election regression discontinuity design we find that despite this system, there is evidence of politically-motivated local fiscal outcomes. Aligned districts receive lower transfers and have lower district expenditure and internally generated funds, indicating swing-voter targeting. Results suggest that district fragmentations have weakened these effects. We also show strong electoral cycle effects, with mid-term peaks in fiscal outcomes.
Topic:
Elections, Fiscal Policy, Decentralization, and Local Government
Political Geography:
Africa and Ghana

136. Wage inequality, firm characteristics, and firm wage premia in South Africa

Author:
Shakeba Foster
Publication Date:
10-2023
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper investigates the role of firm characteristics in driving wage inequality and firm wage premia in the South African labour market. The Abowd, Kramarz, and Margolis (AKM) and Kline, Saggio, and Sølvsten (KSS) regression-based decomposition methods are applied to matched employer–employee administrative tax data for the period 2011–19. Additionally, the Theil index is used as a comparative tool for estimating wage inequality, given that the variance of logarithms applied in the regression-based decomposition methods has been established as an imprecise measure of inequality. The results show significantly high dispersion in wages, as estimated by both the AKM and the KSS methods as well as the Theil index, reaffirming the extent of high inequality in the country. Worker and firm characteristics account for 35 per cent and 18 per cent of wage dispersion, respectively, with a positive worker–firm covariance accounting for 11 per cent. Firm size, industry, profits, geographical location, and whether firms are locally or foreign-owned are found to be important in driving firm wage premia.
Topic:
Labor Issues, Inequality, Economy, and Wages
Political Geography:
Africa and South Africa

137. A reform option for pension fund contribution as tax expenditure in South Africa

Author:
Ada Jansen, Winele Ngobeni, and Wynnona Steyn
Publication Date:
11-2023
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
South Africa has a progressive broad-based personal income tax system with relatively few tax expenditures. The two most important are the medical contribution plus additional tax credits for medical expenses, and the deductions allowed for retirement contributions. A pertinent question for tax reform in South Africa is whether redistributive gains can be achieved by restructuring expenditures in the personal income tax system. This paper considers the redistributive implications of converting the tax deduction for retirement contributions to a tax credit. This would build on the gains achieved by introducing a medical tax credit system in 2012. We analyse the tax revenue gains/losses of income groups and in total in terms of distributional effects and progressivity outcomes using a static microsimulation model based on data for the 2019/20 tax year. We find a high concentration of taxpayers in terms of taxable income and retirement contributions. The concentration of contributions is highly skewed towards lower- and middle-income earners, whose annual contribution amounts are low compared with higher-income earners. We recommend a conversion rate that considers the current distribution of taxpayers contributing to retirement funds. Converting the pension contribution deduction to a tax credit would raise additional revenue and make the tax system more progressive, benefiting low-income earners with marginal tax rates of less than the proposed conversion rate. The revenue gained would provide increased fiscal space to fund social expenditure or reduce government debt. Further distributional and behavioural analyses are needed on low-income earners and those earning below/above the minimum tax threshold, to refine understanding of the impact on low-and middle-income earners’ contributions to retirement funds.
Topic:
Economics, Reform, Tax Systems, and Pension
Political Geography:
Africa and South Africa

138. Differential bunching impacts across the income distribution: Evidence from Zambian tax administrative data

Author:
Samuel Bryson, Kwabena Adu-Ababio, Evaristo Mwale, and John Rand
Publication Date:
12-2023
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
We investigate the behavioural responses of individual taxpayers to changes in marginal personal income tax rates applying empirical bunching methodology to tax administrative data from Zambia over the period from 2014 to 2021. We find evidence for excess bunching at the first kink in the tax schedule for all years but less evidence of bunching at the second and third thresholds. While bunching is considerable and behavioural responses are observed to changes in the location of the kinks over time, bunching at reference points (‘round-number bunching’) also appears large. Implied elasticities of taxable income are however not remarkable, and comparing actual and estimated counterfactual wage distributions reveal that missed tax revenue arising from the excess bunching is limited. This is consistent with the observed bunching reacting sharply and immediately to changes in the location of the kink points over time, suggesting that observed behavioural change is driven by reporting behaviour rather than real economic responses.
Topic:
Economics, Tax Systems, Income, and Income Distribution
Political Geography:
Africa and Zambia

139. Trust a few: natural disasters and the formation of trust in Africa

Author:
Robert Mackay, Astghik Mavisakalyan, and Yashar Tarverdi
Publication Date:
12-2023
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Individuals are at their most mental plasticity in their impressionable years (ages 18–25 years) forming long-term attitudes and behaviours essential to functioning in a society, such as trust. In this paper we ask how exposure to natural disasters within the impressionable years may affect the formation of trust by matching data from over 1,000 disaster occurrences with data from 88,670 individuals across 36 African nations. Exploiting the frequency of disaster exposure across the impressionable years, we show that disaster exposure has a negative and significant association with generalized trust. Additionally, we show that disasters experienced during the impressionable years have an impact on other dimensions of interpersonal and institutional trust. Our findings are robust to a battery of tests and add to the evidence base on the lasting impacts of natural disasters on individuals and societies.
Topic:
Natural Disasters, Crisis Management, Institutions, and Trust
Political Geography:
Africa

140. The dynamics of formal employment during and after the COVID-19 pandemic in Uganda

Author:
Kyle McNabb, Tina Kaidu Barugahara, and Susan Namirembe Kavuma
Publication Date:
12-2023
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper studies the impact of the COVID-19 pandemic on formal sector employment in Uganda. Utilizing employee-level administrative tax data from the Uganda Revenue Authority, we describe the dynamics of employment as the pandemic evolved, seeking to better understand the various coping strategies undertaken by firms in the face of reduced sales and business activity. We find that over one in ten formally employed workers fully lost their incomes in the immediate aftermath of the onset of the pandemic and associated lockdown restrictions. Of those that remained employed, some 14% saw their salaries fall in the short term (to June 2020), and by March 2021 (a full year after the onset of the pandemic) over 9% of the formal workforce were still earning less than pre-pandemic. We subsequently match these pay-as-you-earn records with firms’ income tax returns to better understand how characteristics such as firm size, sector, and profitability affected the likelihood that different coping strategies were undertaken. We find that firms which were larger and more profitable pre-pandemic were more likely to retain their workforce and less likely to cut salaries throughout the course of the pandemic.
Topic:
Employment, Economy, COVID-19, and Income
Political Geography:
Uganda and Africa

141. Working Conditions in Madagascar’s Apparel Industry: Comparing Export and Domestic Market Firms

Author:
Kristoffer Marslev and Lindsay Whitfield
Publication Date:
06-2023
Content Type:
Working Paper
Institution:
Centre for Business and Development Studies (CBDS), Copenhagen Business School
Abstract:
The apparel export industry in Madagascar is one of the largest in Sub-Saharan Africa, yet limited data exists on the conditions of its 180,000 predominantly female workers. This paper draws on new ILO quantitative and qualitative data generated in 2021 and 2022 to provide a systematic mapping of wages and working conditions in Madagascar’s apparel industry. The analysis shows important variations by end market. While workers in export firms are more likely to do excessive overtime and have inadequate rest time, they earn higher wages and enjoy better social protections such as paid leave, insurance, pension, and maternity. In contrast, nearly half of workers in firms producing for the domestic market earn incomes below the national minimum wage and have limited social benefits. These findings point to a paradox in which workers in export firms are more exploited in terms of their labor power but better off in terms of wages and benefits. The paper attributes these differences to the governance dynamics of global apparel supply chains, in which buyers on the one hand require suppliers to meet certain social standards and to comply with domestic labor laws, but on the other hand impose high flexibility demands that incentivize excessive overtime and work intensification. In both export and domestic market firms, however, wages fall severely below living wage benchmarks. In the context of high levels of absolute poverty in Madagascar and even lower incomes in agriculture, there is not much upwards pressure on wages and working conditions from the labor market.
Topic:
Labor Issues, Global Value Chains, Labor Market, Wages, Garment Industry, Work, and Apparel
Political Geography:
Africa and Madagascar

142. Sustainability in the South African Wine Industry: Status, Opportunities and Challenges

Author:
Reena das Nair, Shingie Chisoro, and Stefano Ponte
Publication Date:
09-2023
Content Type:
Working Paper
Institution:
Centre for Business and Development Studies (CBDS), Copenhagen Business School
Abstract:
South Africa has been a pioneer in developing a variety of sustainability programmes and initiatives from farm to bottle, placing it at the forefront of sustainability in the global wine industry. In addition to global sustainability standards, such as Fairtrade and organics, and standards applied by retailers in the Global North, domestic sustainability initiatives and regulations have also been developed since the late 1990s. The existence of sustainability initiatives however does not automatically entail that they are easing the local environmental impacts of viticulture and winemaking, that working conditions are necessarily improving, or that there has been more inclusive participation and ownership by historically disadvantaged persons (HDPs). In this working paper, we unpack whether, how and to what extent different demands and initiatives on sustainability are reshaping the functioning of the wine industry in South Africa and with what benefits for whom. We examine the various sustainability programmes and initiatives in South African wine and assess the implications for costs, investments and profitability of actors in the value chain. Furthermore, to provide a sense of how South Africa fares in the international arena, we also undertake a comparison with sustainability initiatives in the Italian wine industry. We frame sustainability initiatives in broad terms, covering environmental, social and economic sustainability. The growing effects of climate change globally demand that grape growers adapt from an environmental perspective. The pressure for social sustainability emanates from the highly skewed patterns of ownership by HDPs, legacies of racialised inequalities, and a tainted history of poor worker conditions on farms and cellars. We also cover economic sustainability, as it both affects and is affected by environmental and social sustainability initiatives and is critical for the future of commercial production. The research results presented here are part of a larger project funded by the Danish Independent Research Fund Denmark (Project #0133-00046B) on ‘Power and inequality in global production systems’ (PIPS) that also covers industrial fisheries in South Africa and the salmon and wine industries in Chile (with Stefano Ponte as the PI). This paper is focused on presenting the main empirical findings of this part of the project and is targeted at a broad audience. It is built on feedback we received on an earlier version that was discussed with South African industry actors at a webinar on 28 June 2023. More analytical and theoretical publications will follow in selected academic journals.
Topic:
Environment, Labor Issues, Governance, Business, Sustainability, Production, and Wine Industry
Political Geography:
Africa and South Africa

143. Reformulating Index Insurance to Protect Women’s Assets and Well-being: Evidence from Pastoralist Communities in Kenya

Author:
Julian Arteaga, Michael Carter, and Andrew Hobbs
Publication Date:
08-2023
Content Type:
Working Paper
Institution:
BRAC Institute of Governance and Development (BIGD), Brac University
Abstract:
The novel insurance contracts for crop losses and livestock mortality that have been developed in low income countries typically protect against shocks in the male sphere of economic activity. Often overlooked are women, the particularities of their indirect exposure to this risk, and their socially constructed responsibility to manage family well-being. To fill this lacuna, this paper studies the effect of a low-cost intervention that reformulates a livestock insurance contract so that it directly addresses women's risk and is sold in units that are commensurate with women's expenditure responsibilities. We measure the effect of this contractual reformulation using a randomized trial amongst pastoralist communities in Kenya. Twenty-four percent of previously subsidized households that received the novel contractual formulation purchased insurance (without subsidy), compared to only 13\% of previously subsidized households offered insurance under the standard male-risk formulation. Households that had not received prior insurance subsidies purchased no insurance, irrespective of the framing. Protecting women, their assets and those who depend on them will require a combination of smart subsidies and gender-intentional insurance contract design.
Topic:
Agriculture, Women, Pastoralism, Insurance, and Assets
Political Geography:
Kenya and Africa

144. The Wellbeing Effects of an Old Age Pension: Experimental Evidence for Ekiti State in Nigeria

Author:
María Laura Alzua, Natalia Cantet, Ana C. Dammert, and Damilola Olajide
Publication Date:
12-2023
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
Many countries in the developing world have implemented old-age pensions. Evidence of the impact of such policies on the elderly in sub-Saharan Africa, however, is scarce. We provide evidence from a randomized evaluation of an unconditional old-age pension targeted at the elderly in Ekiti State, Nigeria. Our findings show that treated beneficiaries self-report better quality of life and a more stable mental health. We also provide evidence of spillover effects on the labor outcomes of other household members and of household savings patterns as well as support for interventions aimed at improving the welfare of elderly poor citizens and other household members.
Topic:
Health, Developing World, Aging, Pension, and Well-Being
Political Geography:
Africa, Nigeria, and Sub-Saharan Africa

145. Labor Informality and Market Segmentation in Senegal

Author:
Carlos Rodríguez-Castelán and Emmanuel Vazquez
Publication Date:
10-2023
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
Understanding the selection of workers into informality is a policy priority to design programs to increase formalization across Sub-Saharan Africa, where nine out of ten workers are informal. This paper estimates a model of self-selection with entry barriers into the formal sector to identify the extent of involuntary informality in Senegal, a representative country in terms of levels of informality in West Africa and with one of the most rigid labor markets in the world. Results show that the desire of being formal is greater for workers with formal education, married and with a lower proportion of children under the age of 5 living in the household. The individual’s preference for the formal sector also grows with age at a decreasing rate. Results also show that labor informality is mainly a voluntary phenomenon with 30 percent of informal workers being involuntarily displaced into the informal sector. Results are robust to different model specifications, definitions of labor informality and heterogenous groups of workers.
Topic:
Labor Market, Informal Economy, Informality, and Segmentation
Political Geography:
Africa and Senegal

146. Will Africa be part of the ‘golden decade’ of sustainable finance? Insights from GSSS bonds

Author:
Abel Gwaindepi and Krige Siebrits
Publication Date:
11-2023
Content Type:
Working Paper
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
In the current 'decade of action' for Sustainable Development Goals (SDGs) and climate action, the battleground for success or failure lies in lower-income countries. Equally evident now is that this battle is also won or lost at the doorsteps of development and climate finance and its insertion into the current international financial system. This DIIS Working Paper explores Green Social Sustainability and Sustainability-linked (GSSS) bonds in Africa. These have emerged as main private sector financing tools with recent explosive growth in European markets. Evaluating their current performance, as this study does, is crucial for policy debates and development interventions. It serves as a critical yardstick to gauge the effectiveness of private sector financing in general for advancing SDGs and climate action in developing country contexts. The progress of GSSS bonds in mobilising private sector finance in Africa allows a re-evaluation of which private sector instruments and approaches can thrive in developing country contexts, as their success in Europe does not guarantee success in emerging and low-income markets. Given that GSSS bonds are designated for specific green, social, and sustainable projects, the study's results underscore the need to shift the conversation beyond the novelty of these instruments toward a bottom-up approach that starts with pre-feasibility financing necessary for project pipelines. This approach allows the focus to be rightly put on pipelines of projects followed by deciding suitable public or private financing mechanisms.
Topic:
Climate Change, Development, Environment, Finance, Sustainable Development Goals, and Sustainability
Political Geography:
Africa

147. Gold in Ghana: A Story of Unbalanced Exchange

Author:
Léonce Ndikumana and William Godfred Cantah
Publication Date:
09-2023
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
his paper presents the historical and institutional context of the development of the gold sector in Ghana, which sets the stage for examining the contribution of the sector to the economy and its exposure to capital flight. The analysis sheds light on the important role that the regulatory framework and the fiscal regime that govern the gold sector have played in perpetuating a system of unequal distribution of gains from gold exploitation in terms of tax revenue and foreign exchange earnings in favour of foreign gold companies. The statistical analysis of gold export statistics reveals substantial discrepancies between Ghana’s gold exports and the recorded value of imports by its trading partners. These differences point to export underinvoicing as a conduit of capital flight, while also exhibiting a systematic lack of transparency and inconsistencies vis-a-vis established international conventions governing the recording of trade transactions, especially in the case of gold destined for South Africa which does not show up in the latter’s import statistics. Overall, the analysis suggests that the gains from the gold sector remain much below potential, but that at the same time there may be room for reforms that can improve the benefits from gold exploitation for the country.
Topic:
Development, Regulation, Capital Flight, Exchange Rates, and Gold
Political Geography:
Africa, South Africa, and Ghana

148. Cocoa in Ghana, the ‘Political Crop’: Does State Control Shield the Cocoa Sector from Exposure to Capital Flight?

Author:
Léonce Ndikumana and Kwame Adjai-Mantey
Publication Date:
08-2023
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
Since its introduction into Ghana in the 19th century, cocoa has been considered a strategic crop, over which the post-independence governments have maintained substantial control. Cocoa is indeed referred to as a ‘political crop.’ The cocoa sector is closely regulated by the government through the Ghana Cocoa Board (COCOBOD). This paper aims to investigate whether this special industrial organization structure and the strict regulation help minimize the sector’s exposure to capital flight that would otherwise occur through export misinvoicing and leakage of foreign exchange earnings from cocoa exports. Indeed, compared to the gold sector in Ghana and the cocoa sector in neighboring Côte d’Ivoire, both of which are fully liberalized and dominated by foreign corporations, the cocoa sector in Ghana exhibits relatively little evidence of export misinvoicing. Moreover, cocoa export earnings are fully repatriated as they are in the hands of COCOBOD. The analysis, however, indicates that the gains from the cocoa sector in terms of contributions to GDP, tax revenue, and poverty reduction remain sub-optimal. This suggests that there is substantial room for improvement of these outcomes through targeted reforms and policy interventions at the sectoral level.
Topic:
Political Economy, Reform, Exports, Capital Flight, and Cocoa
Political Geography:
Africa and Ghana

149. Capital Flight from Natural Resource-Dependent African Countries: Updated Estimates and Analysis for the Cases of Cameroon, Ghana, and Zambia, 1970-2021

Author:
Léonce Ndikumana
Publication Date:
08-2023
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
This paper is part of a project that investigates domestic and global drivers and enablers of capital flight from Cameroon, Ghana, and Zambia, three countries that are significantly endowed in natural resources. It presents estimates of capital flight from these three countries and discusses the key drivers of the phenomenon. The results show that as of 2021, estimated total capital flight stood at $71.1 billion for Cameroon, $50 billion for Ghana, and $71.5 billion for Zambia. External borrowing and, in the cases of Zambia and Cameroon, trade misinvoicing, are key correlates of capital flight. While external borrowing directly and indirectly drives capital flight, trade misinvoicing constitutes an important mechanism of unrecorded cross-border capital flows. This study contributes to the efforts to uncover the mechanisms and enablers of capital flight from Africa, with the aim of shedding light on possible strategies to curb further capital outflows in the context of efforts to scale up and diversify development financing to support recovery from global crises, the transition to green growth, and sustainable development in Africa.
Topic:
Development, Political Economy, Natural Resources, Capital Flight, and Trade
Political Geography:
Africa, Zambia, Ghana, and Cameroon

150. The Implementation of Sustainability Taxonomies: The Case of South Africa

Author:
Sören Hilbrich, Kathrin Berensmann, Giovanna Artmann, Sam Ashman, and Theresa Herbold
Publication Date:
01-2023
Content Type:
Working Paper
Institution:
German Institute of Development and Sustainability (IDOS)
Abstract:
In recent years, many jurisdictions have developed sustainability taxonomies that aim to increase transparency of financial markets and redirect capital flows to sustainable investments. Such sustainable finance policies can be important levers because today’s investments shape economic production processes for decades. This case study on South Africa’s Green Finance Taxonomy (GFT) addresses the question of what factors influence the adoption of sustainability taxonomies by potential users. It finds that one year after its publication, the GFT has hardly been used in practice. Important factors hindering an effective implementation are a lack of regulatory embedding, the absence of a legal recognition of the GFT by the European Union (EU), a hesitancy among financial market participants to build capacities to collect the necessary data, and fossil-fuel path dependencies in South Africa’s economy. These findings have important policy implications (e.g. regarding accompanying governance measures) for implementation processes in many countries in the coming years.
Topic:
Development, Economy, Capital Flows, Investment, and Sustainability
Political Geography:
Africa and South Africa