January 2008

A new CGAP/DFID paper addresses the policy implications of branchless banking. Regulating Transformational Branchless Banking: Mobile Phones and Other Technology to Increase Access to Finance is based on assessments of policy and regulation in seven key countries, including interviews with more than 500 people from governments, the private sector, and international organizations in Brazil, India, Kenya, Pakistan, the Philippines, Russia and South Africa.

While much of the current buzz is around mobile phones, other branchless banking applications are gaining traction as well. Brazil's increase in access to finance has been accomplished largely through the more than 95,000 banking "correspondents"—local merchants and post offices that act as agents for banks, equipped with card-swipe and barcode-reading point-of-sale (POS) terminals. In Russia, a broad network of bank ATMs, POS terminals, and online e-money providers offer transaction services outside of traditional branch offices.

Want to know more? Read the full report and access country-by-country information.

Based on surveys from Bogotá, Colombia took a 66th position out of 178 in the Doing Business 2008 report and became this year's top reformer. But as the subnational report (en español) released today shows, there are vast discrepancies on the ease of doing business among the county's 12 main cities.

Municipal requirements make up 7 of the 19 procedures required to start a business in Neiva, but only 1 of 13 in Villavicencio—the city with the fewest start-up procedures.

The graph below shows the time required to enforce contracts across 12 Colombian cities:

A new paper compares changes in financing by international banks to domestic banks after the 1998 Russian debt crisis. The author finds that financing increased to banks with international equity holders when compared with their purely domestic counterparts.

Financial liberalization can make you more resilient to global credit shocks, but only if you invite foreigners rather than just borrow their money.

Can information and communication technologies (ICT) foster critical and entrepreneurial thinking at the bottom of the pyramid? This was one of the key themes that emerged from the GK3 conference last month.

Take for example the One Laptop for Child initiative. Interestingly, the debate did not center around the long-term sustainability of the project, but whether it can help move education systems in emerging markets away from the hierarchical, rule-memorizing approach.

Once you start seeing users of ICT in developing countries as creative contributors, a whole new world of opportunities emerges. Backed by InfoDev, the Equinox project allows teachers, trainers and companies in emerging markets to build and share e-learning curricula.

In light of a record labor force growth in parts of the Middle East, some question the ability of Arab countries to accommodate this demographic bulge and create enough jobs for the population.

Haward Pack and Marcus Noland – the authors of "The Arab Economies in a Changing World" - argue that relying oil hefty revenues alone won't solve the problem.

Becoming more globally competitive is the way for the future, they say, but it won't be easy given China's established dominance in the manufacturing and India's in the services industry and the region's overall difficult business climate.

Though most agree that taxes are important and necessary, the question: "how to best design them?" remains.

Rapid Response has added a SME tax toolkit with advice for policymakers on how to bring and keep small business in the formal economy.

When most people think about Sabang, they think about diving. For good reason – the diving spots here are among the best in the world. But there’s more to Sabang than diving, as I discovered by chance. It also has biker chicks.

After yet another fabulous weekend of diving, I took the minibus to Balohan, where the ferry port is. But for the first time ever, I could not get a ticket. Normally you can get on the boat by slipping some cash to the crew. But this time it was impossible. When the boat pulled away from the dock, there were people literally hanging off the railings. Definitely a game for younger people than myself.

Luckily, my Indonesian is now good enough to get me through situations like this. I found a little hotel nearby for only 60,000 Rp, leaving just enough for the return ticket and a few meals. Then I decided to go for a good long walk. I was quite a sight – a foreigner huffing along on foot, gushing with sweat. My biggest problem was turning down offers for rides. Saya jalan-jalan saja, I explained. I'm just going for a walk.

Prof. Barbara Fraumeni will present her online course "National Income Statistics" from Feb. 29 - March 21 at statistics.com.  Participants can interact with Prof. Fraumeni over a period of 3 weeks via a private discussion board.

This course covers the essentials of how National Accounts statistics are compiled. Participants will learn what Gross Domestic Product (GDP) and Gross National Income (GNI) and their components are, and what they mean. Underlying concepts will be explained. Major GDP components include consumption, investment, government expenditure and net exports. In addition, the various accounts:  household, business, financial and balance sheet, and general government, will be covered.  Examples will be used from the national accounts of a number of countries.

Registration and details

Econsense created an interactive database for all-things climate. Much like our Do-Your-Own-Analysis, it allows to compare and contrast data across countries, in this case, on topics such as greenhouse gas emissions, fuel tax, emissions trading and biofuel production.

Ceres, a coalition of investors, environmental groups and other public interest organizations, believes that the financial services industry – with nearly $6 trillion in market capitalization – should play a role in combating climate change.

Most recently, Ceres released a first comprehensive assessment of how the world's 40 largest banks fulfill their commitments to the reduction of greenhouse gas emissions.

The study found that, despite an overall widespread positive trend, only 12 banks made climate change a governance priority; only 6 said they were calculating carbon risk in their portfolio and "no bank has set a policy to avoid investments in carbon-intensive projects such as coal-fired power plants."

As usual on Fridays, based on Raj Nallari and Breda Griffith's lecture notes.

 
Gender and Macroeconomics

Gender disparities are far from static and often change quite rapidly in response to changing socioeconomic conditions. Public policy that promotes gender equality can play an active role in bringing about successful growth and development.  Moreover, other aspects of an individual’s economic decision-making that is gender specific and/or that responds to public policy may also lead to different outcomes for macroeconomic aggregates. As noted by Stotsky (2006), public policies may enhance women’s employment possibilities with implications for taxation policy, social insurance, spending and other regulatory policies and structural reforms.  The improvement and reduction of gender inequalities summarized in Goal 3 of the Millennium Development Goals seeks to “promote gender equality and empower women”.  Moreover, gender equality lies behind two further goals in seeking equality in primary and secondary education with full enrollment of girls in primary education and improvements in maternal health.  Failing to acknowledge gender issues in macroeconomic policies can lead to unintended consequences as the experience with the structural adjustment policies attests.