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June 2016

Why Zambia’s 6 cents is more significant than Dubai’s 3 cents

Gevorg Sargsyan's picture


Last week Zambia set a new price record for utility-scale solar-generated energy in Africa with the support of the World Bank Group’s (WBG) Scaling Solar initiative. The auction for 100 MW (2x50 MW) resulted in a price as low as 6 cents/kWh.
 
This is good news for the country, which much like the rest of Sub-Saharan Africa faces acute electricity shortages. Nearly 700 million people in Sub-Saharan Africa don’t have access to electricity.
 
Zambia’s solar auction result followed a series of headline-making auctions in India, Mexico, Peru, and Dubai. In Dubai’s case, the price was as low as 3 cents/kWh -- the lowest price ever offered for solar power. Solar auctions are effectively a competitive bidding process to build power plants and supply a specific quantity of electricity at a pre-agreed price over a specified period of time.

Harnessing Stitches for Riches in South Asia

Gladys Lopez-Acevedo's picture
Stitches to Riches? The Potential of Apparel Manufacturing in South Asia

In the coming years and decades, China is expected to slowly relinquish its lead position in the global apparel market, opening the door to other competitors. This is a huge opportunity for South Asia to create at least 1.5 million jobs that are “good for development” – of which half a million would be for women – according to a new World Bank report Stitches to Riches?  But those numbers could be much higher if the region moves quickly to tackle existing impediments and foster growth in apparel, which will also yield dividends for other light manufacturers (like footwear and toys).
 
How South Asia fits in the global apparel market
Currently, China holds by far the largest share of global apparel trade – at 41 percent, up from 25 percent in 2000, with about 10 million workers. But as China continues to develop, it is likely to move up the global value chain into higher-value goods (like electronics, and out of apparel) or switch production among sectors in response to rising wages. A 2013 survey of leading global buyers in the United States and European Union (EU) found that 72 percent of respondents planned to decrease their share of sourcing from China over the next five years (2012-2016).
 
Already, the top four apparel producers in South Asia – Bangladesh, India, Pakistan, and Sri Lanka – have made big investments in world apparel trade, now accounting for 12 percent of global apparel exports (see figure). In terms of apparel export value, Bangladesh leads the pack (at $22.8 billion), followed by India ($12.5 billion), Sri Lanka ($4.4 billion), and Pakistan ($4.2 billion).
 
China dominates global apparel trade
(Country share of global apparel exports)


Source: Stitches to Riches?
 
Why apparel jobs are “good for development”
When we think of jobs that are “good for development,” the main yardstick is whether they will help translate growth into long-lasting poverty reduction and broad-based economic opportunities. Apparel fits the bill for numerous reasons. 

Discovering the Bank’s Archives: Conversation with a researcher

Elisa Liberatori Prati's picture

Giovanni Zanalda is director of the Duke University Center for International Studies/Global Areas.June 9 is International Archives Day, and I would like to mark this day by reflecting on the contribution of the World Bank Group Archives to the “memory” of the development community. As such, I am talking with Giovanni Zanalda, director of the Duke University Center for International Studies/Global Areas. Giovanni is a faculty member in the Departments of Economics and History at Duke and specializes in financial history, history of development, and emerging markets. He has been a user of the WBG Archives in different phases of his career and with different focuses, and we have asked him to share his user perspective.

Chart: A Fast Fall in Growth Among Commodity Exporters

Tariq Khokhar's picture

In 2016, emerging markets and developing economies are forecast to grow by 3.5% - slightly lower than the recent average. Within this group, trends vary between commodity exporters and importers. In 2016, importers are expected to see steady 5.8% growth, but exporters are struggling to adjust to persistently low commodity prices and are forecast to grow only 0.4%. Read more in the The June 2016 Global Economic Prospects report.
 

Thomas Piketty on inequality in developing countries (great, but still not enough on politics)

Duncan Green's picture

I heard econ rock star Thomas Piketty speak for the first time last week – hugely enjoyable. The occasion was the annual conference of the LSE’s new International Inequalities Institute, with Piketty headlining. He was brilliant: original and funny, riffing off traditional France v Britain tensions, and reeling off memorable one liners: ‘meritocracy is a myth invented by winners’; ‘It’s difficult to be an honest country in today’s world. Britain used to be an honest country.’

He started with a mea culpa for the lack of attention in his best selling Capital in the 21stCentury to inequality in developing countries. The good news is that he is now putting that right, with research under way on inequality in South Africa, Brazil, the Middle East, India and China. He gave us a preview on the first three.

His overall conclusion? "Official measures vastly underestimate inequality". The most common reason for this is that inequality stats are drawn from household surveys, but samples of households typically miss the few megarich ones, and so underestimate the money at the top. He prefers to use tax and income data, which he has now got access to from governments because of his newfound fame. Even that data doesn’t tell the whole story, as it misses tax evasion, for example, but it’s a step in the right direction.

The things we do: Can computer games contribute to HIV prevention?

Roxanne Bauer's picture
Also available in: Español

Preventing and controlling HIV is essential to ensuring that everyone can lead healthy, productive lives. It is essential to address this disease if everyone is to share in global prosperity.  The international community has made significant gains in fighting the spread of HIV as well as in increasing the survival rate of those already infected.

However, women- and in particular young women- remain vulnerable to contracting the disease.  According to The Gap Report from UNAIDS, adolescent girls and young women account for one in four new HIV infections in sub-Saharan Africa.  Globally, there are about 16 million women aged 15 years and older who are living with HIV, and 80% of them live in sub-Saharan Africa.  Within this region, women acquire HIV infections at least 5–7 years earlier than men, primarily through heterosexual transmission. While there is some research that younger women are more physiologically vulnerable to HIV, the evidence also points to several non-physiological factors that help account for gender inequalities, including inequalities in education and economic opportunities, vulnerability to intimate partner violence, and women having sex with older men.

In West Africa, education = jobs and jobs = development

Adaiah Lilenstein's picture
Job creation is a crucial aspect of development. And broad-based, high-quality education is crucial for inclusive development. Worryingly low levels of education quality and quantity show that there is a crisis of education in some West African countries. If inclusive growth is to pull people into the labor market and out of poverty, this must be addressed. Getting education right is a crucial first step on the road to creating better employment and reducing poverty. It must be considered a priority by national governments and donors alike.
 

The cost of renewable energy public-private partnerships in developing countries

Jeff Delmon's picture
Also available in: Español

 Tomislav Georgiev /World BankAltruistic and marketing motives aside, a private operator of infrastructure (in particular in an arrangement as highly structured as PPP) is likely to implement renewable energy technology only if profitable and/or mandated in the PPP arrangements. Critics are often angry that private operators think first about the bottom line, rather than make decisions based on the best interests of the environment. This is unfair to some extent, as private companies are often committed to climate friendly efforts (whether truly altruistic or for marketing opportunities). But as a general premise, the private sector will do what you pay it to do.

Three Key Ideas for Creating Effective Investment Policies

Roberto Echandi's picture
Attracting, promoting and retaining foreign investment is a complicated matter – especially for a developing economy. Evidence shows a compelling case for foreign direct investment (FDI): foreign investors can create jobs, bring capital and technologies, create knowledge spillovers, help local companies integrate with global value chains, and drive economic growth in general.

Pathways to Prosperity: An e-Symposium

Urmila Chatterjee's picture
Pathways to Prosperity Banner

 

Blog #5: The low income, low growth trap

India is home to the largest number of poor people in the world, as well as the largest number of people who have recently escaped poverty. Over the next few weeks, this blog series will highlight recent research from the World Bank and its partners on what has driven poverty reduction, what still stands in the way of progress, and the road to a more prosperous India.

We hope this will spark a conversation around #WhatWillItTake to #EndPoverty in India. Read all the blogs in this series, we look forward to your comments.

While India’s economy has grown more rapidly in recent decades, the gains have been unevenly spread, and some regions have fallen further behind the rest of the country. In particular, India’s seven ‘low-income’ states have struggled to shake off the legacy of high consumption poverty, low per capita incomes, poor human development outcomes and the persistence of poverty among tribal populations. The fact that these states are yet to catch-up with the rest of the country illustrates that ‘where you live’ largely determines ‘how well you live'. Addressing this geographic dimension of poverty and well-being will therefore hold the key to improving the lives of millions of Indians.


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