Last week, the U.N. Conference on Trade and Development (UNCTAD) released its semi-annual report on FDI flows, which reflected generally dismal results: global FDI declined by 8 percent, with a 5 percent decrease for the developing world in particular. I found it interesting that South Africa’s significant decline in FDI seemed to catch a good deal of media interest. Yes, the continent’s darling and the usually one of the highest recipients of FDI saw a drastic drop (by 43%); admittedly this deserves more than a glance. But I wonder why Finland and Ireland’s numbers, at 96.2 and 42.8 percent respectively, didn’t make much news. South Asia’s inflows also fell by 40 percent as a result of declines across nearly all countries in the subcontinent. In India, inward FDI fell from US$18 billion to US$10 billion. Why South Africa? In my opinion, the flow of investment to sub-Saharan Africa is often reported as a sign that the doors of the last frontiers are being approached.
At a time when all decision-makers around the world can think about is the state of their country’s economy, debt, spending and fiscal stability, one phrase attempts to sum it all up: it’s arithmetic.
In Armenia, it is all about arithmetic too.
Despite the volatility of Armenia’s economy in the twenty years since the country gained independence, effective government reforms led to double-digit growth rates from 2001 to 2007. That ended with the global financial crisis in 2008.
Caution – this blog is almost as long as the soon-to-be commissioned Niagara Tunnel.
Often I can hide it – posing maybe as an economist, risk manager, a finance-guy, public-policy wonk; I’ve even once been complimented as an urban planner. But every now and then I revert to form and it slips out that I’m an engineer. This week was a classic – a ‘boy and his toys,’ my wife warned.
I went to Niagara Falls not to see the falls, or visit the casino, but to tour Ontario Power Generation’s (OPG) Niagara Tunnel and Adam Beck Hydroelectric Power Station! Well worth a ‘!’ as getting to visit these two big civil engineering works was a bit like Christmas coming early; and they provide important lessons.
India today is the fourth largest economy in the world. But for the country to sustain a growth rate of close to 6%, it remains vulnerable to the vicissitudes of global investors. It’s time to ponder: why it is not the other way round? How can India reach a position where we not only follow the rise and fall of global economic forces but also lead the way in sustaining the global economy? This is my dream.
Improving Ongoing Flagship Programs:
-The monitoring of all flagship projects should be improved right from the Gram Panchayat level to the state and central level.
-Models need to be developed for every flagship program, success factors studied, and implementation aligned with the specific needs of each state.
-All program implementation officers should be trained by those who have worked in successful programs. Pay should be linked with performance.
-Resource reallocation should depend on progress and work load.
-All unsuccessful programs should be analyzed to understand the main causes for failure and alternatives planned.
-Benchmark studies should be conducted to identify critical indicators for development in education, health and infrastructure and year on year progress checked.
Available in Bahasa
The new airport in Banda Aceh was as magnificent as the Taj Mahal—bright, with endless marble floors and beautiful domes. You can almost imagine a reflecting pool, maybe a garden…OK, I might be getting a little carried away. But if you had ever travelled through the old airport—something like a Greyhound bus station in a rust-belt city with a runway attached—you’d understand my excitement.
That was more than four years ago. Since then, the entire city has transformed. Just take the roads. I used to bike all over the city, so I know from first-hand experience that many of the roads were in bad shape, with huge potholes and puddles as big as lakes. But now? You might think you were driving in Germany. Every road is perfectly paved, even the narrow, single-lane ones. When it rains, the water just drains away.
Africa’s infrastructure deficit is no secret. Several recent studies by the World Bank and others have confirmed that across the continent, roads are inadequate, railways in poor condition and waterways limited. While the problems are most obvious at the national level, they are more acute along routes connecting countries. Lack of resources contributes to the patchy state of infrastructure connectivity between African countries. But it is not the only hurdle. A key question is: given limited resources, how should infrastructure be planned, prioritized and financed?
Sixteen countries in Sub-Saharan Africa are landlocked. To trade goods in overseas markets, they must cooperate with their coastal neighbors, working together to plan roads, transport goods to port and keep borders open. This is harder than it sounds. While numerous regional organizations exist to coordinate infrastructure planning in Africa, in practice they are made up of representatives with interests rooted in their own countries. Decisions by these bodies are often political and driven by members’ desire to see projects in their home territories.
As a graduate student in Cambridge, Massachusetts living outside my home country Philippines for the first time, attending Boston Red Sox games at Fenway Park marked the beginning of my initiation into American life — and that most American of pastimes: baseball. Fenway Park (the country’s oldest ballpark) turned 100 years old last Friday (April 27, 2012). It is a wonderful icon of the enduring nature and magnetic power of cities.
Fenway Park (like the city of Boston) is small, expensive, and still has infrastructure from 1912. The bathrooms, parking, and other amenities don't always work (again, like many great cities). But overall, this urban gem is the best place to watch a baseball game — despite the 86-year drought in World Series championships.
Why 13 governments, 10 ministers and 270 people decided to gather for policy discussions on infrastructure in the Middle East and North Africa (MENA) and the role of the private sector. (And no, it wasn’t the fact that the forum was in Marrakech because none of us left the hotel). I was really inspired by the enthusiasm generated by the March launch in Rabat of the Affiliated Network for Social Accountability – Arab World. The event brought civil society people from across MENA together and demonstrated a real ability to shape and further a debate around the issues of participation and youth.
At the World Bank Spring Meetings last week, there was a very interesting discussion, moderated by Femi Oke, on the topic of “Investment, Infrastructure, and Integrity,” On the panel were a few worthies from the private sector, Karan Bhatia, of General Electric, Peter Solmssen of Siemens AG, and Julio Rojas of Standard Chartered Bank, along with Rashad Kaldany and Janmitra Devan of the World Bank. They were joined by the Minister of Finance of Indonesia, Agus Martowardojo, and the Secretary of Finance of the Philippines, Cesar Purisima.
The issue is a prickly one: How to promote clean business in large infrastructure projects? It is unavoidable for the World Bank, the private sector and governments to be involved in infrastructure, so it is essential that the reputation of the infrastructure sector be tied to integrity. At the same time, the response to corruption has to be pragmatic. The challenge is to figure out the balance and respond appropriately and make “risk-based” decisions, versus “rules-based” decisions. The panelists alluded to the role of knowledge and the open dissemination of knowledge on private-sector business dealings and in government contracting and procurement to spur accountability and governance in this arena. There was agreement that the World Bank’s open agenda would be helpful in pushing this forward.
The panel was asked to share their individual “principles” to achieve integrity.