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Reforms Sri Lanka needs to boost its economy

Idah Z. Pswarayi-Riddihough's picture
 Joe Qian/World Bank
The Colombo Stock Exchange. Credit: Joe Qian/World Bank

Many Sri Lankans understand the potential benefits of lowering trade costs and making their country more competitive in the global economy. The majority, however, fear increased competition, the unfair advantage of the private sector from abroad and limited skills and innovation to compete.

Yet, Sri Lanka’s aspirations cannot be realized in the current status quo.  

While changes in trade policies and regulations will undeniably improve the lives of most citizens, I’m mindful that some are likely to lose. However, many potential gainers of the reforms who are currently opposed to them are unaware of their benefits.

Implementing smart reforms means that government funds will be used more effectively for the people, improve access to better healthcare, education, basic infrastructure and provide Sri Lankans with opportunities to get more and better jobs. Let me focus on a few reforms that I believe are critical for the country.  First, Sri Lanka needs to seek growth opportunities and foreign investment beyond its borders.    

First, Sri Lanka needs to seek growth opportunities and foreign investment beyond its borders.

Experience shows that no country in the world today has been able to create opportunities for its population entirely within its own geographic boundaries. To succeed in this open environment, Sri Lanka will need to improve its skills base, better understand supply and demand chains as well as produce higher quality goods and services

Experience shows that no country in the world today has been able to create opportunities for its population entirely within its own geographic boundaries. To succeed in this open environment, Sri Lanka will need to improve its skills base, better understand supply and demand chains as well as produce higher quality goods and services.

Horticulture offers hope for growth and jobs in rural Afghanistan

World Bank Afghanistan's picture
Until the late 1960s, Afghanistan was a major exporter of horticulture products, particularly dried fruits. Photo Credit: World Bank

Afghanistan is struggling with unemployment and poor economic performance because of drastic reductions in foreign aid and continued social instability. While efforts have been made to improve the private sector, including several sectors like mining and manufacturing, the gains have been modest as Afghanistan remains beset by conflict and instability.
 
Yet investments in agriculture, particularly horticulture, have produced tangible returns as unique weather conditions are favorable to growing produce that are in-demand in local and regional markets. 

An example can be found in Mullah Durani, a farmer from Mohammad Ali Kas village in Qarghaee district in eastern Laghman Province, who converted his field to growing grapes for fruit consumption in 2015 that is paying off in creating jobs and boosting income. “My land has generated eight times higher returns, while I can use the local workforce on my own farm instead of sending them to cities to work for others,” says Mullah Durani. “I have also been able to create seasonal jobs for a number of villagers during harvesting.”
 
The key to his success, he says, was choosing the right variety of grapes instead of grains. “My recently established vineyard produces grapes at a time when there are almost no domestic fruits in the market and in return, I get higher market prices,” he points out. “This year I sold about $4,000 worth of grapes from 2,000 square meters of land.”
 
By converting his field to growing grapes, Mullah Durani received investment support and technical assistance from the Afghanistan Ministry of Agriculture, Irrigation and Livestock under its National Horticulture and Livestock Project (NHLP). The project is funded by the Afghanistan Reconstruction Trust Fund (ARTF) and helps farmers in selected districts adopt better production practices.

Chart: What Are the World's Wettest Countries?

Tariq Khokhar's picture

Africa has the world’s least developed weather, water, and climate observation network, with half of its surface weather stations not reporting accurate data. Hydrological and meteorological (“hydromet”) hazards are responsible for 90% of total disaster losses worldwide. Being able to understand, predict, and warn citizens about natural hazards and disasters drives the ability of governments to reduce economic risks and save lives.

The World Bank’s research shows that annually, countries can save US$13 billion in asset losses alone by investing in hydromet services. This week, Africa’s first-ever ministerial level Meteorology Hydromet Forum formally recognizes the role hydromet services play in development.

Leaving no one behind – achieving disability-inclusive disaster risk management

Charlotte McClain-Nhlapo's picture
Southern, Thailand - January 9, 2017: a volunteer helps a man with a disability get through the flood in his wheelchair. Photo: issara anujun / Shutterstock.com
Natural hazard events can occur in any country, at any time.  At present, India, Bangladesh, and Nepal are dealing with the aftermath of some of the worst monsoon flooding in years, which has left more than 1,200 people dead and millions homeless.  At the same time, North America and the Caribbean region are responding to some of the strongest hurricanes on record.

At such times of peril, individual and community resilience is at a premium, and we cannot afford to miss opportunities to bolster that resilience wherever possible. This is especially true with respect to certain groups – such as persons with disabilities – who have historically been disproportionately affected by natural hazards.

While some strides have been made in addressing the needs of persons with different disabilities in response and recovery efforts, fewer efforts are aimed at incorporating lessons into long-term disaster and climate risk management at a systemic and/or policy level.  

More needs to be done to create disability inclusion for all – a topic that will be discussed during a Facebook Live chat on September 19 at 10 am ET: facebook.com/worldbank

Innovation: A meaningless “catchword” or something more useful?

Alanna Simpson's picture
Can innovation be more than just a gimmick? © DFID
Can innovation be more than just a gimmick? © DFID

Challenges in development are growing at unprecedented rates, driven by complex human crises: refugees, rapid and unsustainable urbanization and climate change, failure to meet basic infrastructure needs, youth unemployment and disengagement, and stubbornly poor health and education outcomes, to name a few. Set against a backdrop of political and public pressure to do more with less – and see results faster than ever – even the most optimistic among us are likely to view the glass half empty. 

Africa Hydromet Forum: Improving climate and weather forecasting to build disaster resilience

Ede Ijjasz-Vasquez's picture

Photo: JC McIlwaine / UN Photo

There is no doubt that extreme weather events are increasing in frequency and severity. In Africa alone, 90% of all disasters in recent decades have been driven by weather and climate. While we cannot stop them from striking, we can tell people about them, managing the risk that they present – by advancing our work in hydromet.

Hydromet is the union of hydrology and meteorology, combining water, weather, and climate studies as a formidable force in a government’s ability to accurately understand, forecast, and communicate storms and hazards. This means that something as simple as an accurate weather forecast, or the monitoring of river levels could make the difference between a farmer losing his/her entire crop or a fisherman knowing when best to head out to sea.  

Because of the lack of high-quality hydromet services, countries suffer GDP losses every year from flooding, cyclones, and other storms. Madagascar and Nigeria, for example, each lost more than 1 percent of GDP in a single year from storms.

However, instead of looking at potential future damages, we must look at how hydromet services can help cities and communities flourish with greater resilience today:

Fresh thinking on economic cooperation in South Asia

Nikita Singla's picture
 Aamir Khan/ Pakistan, Sreerupa Sengupta/ India, Sanjay Kathuria/ World Bank, Mahfuz Kabir & Surendar Singh/ Bangladesh) Photo By: Marcio De La Cruz/ World Bank
Young Economists sharing the stage with Sanjay Kathuria, Lead Economist and Coordinator, Regional Integration (Left to Right: Aamir Khan/ Pakistan, Sreerupa Sengupta/ India, Sanjay Kathuria/ World Bank, Mahfuz Kabir & Surendar Singh/ Bangladesh) Photo By: Marcio De La Cruz/ World Bank


That regional cooperation in South Asia is lower than optimal levels is well accepted. It is usually ascribed to – the asymmetry in size between India and the rest, conflicts and historical political tensions, a trust deficit, limited transport connectivity, and onerous logistics, among many other factors.

Deepening regional integration requires sufficient policy-relevant analytical work on the costs and benefits of both intra-regional trade and investment. An effective cross-border network of young professionals can contribute to fresh thinking on emerging economic cooperation issues in South Asia.

Against this background, the World Bank Group sponsored a competitive request for proposals.  Awardees from Bangladesh, India, and Pakistan, after being actively mentored by seasoned World Bank staff over a period of two years, convened in Washington DC to present their new and exciting research. Research areas included regional value chains, production sharing and the impact assessment of alternative preferential trade agreements in the region.

Young Economists offer fresh thoughts on economic cooperation in South Asia

Mahfuz Kabir, Acting Research Director, Bangladesh Institute of International and Strategic Studies and Surendar Singh, Policy Analyst, Consumer Unity Trust Society (CUTS International) presented their research: Of Streams and Tides, India-Bangladesh Value Chains in Textiles and Clothing (T&C). They focus on how to tackle three main trade barriers for T&C: a) high tariffs for selected, but important goods for the industries of both countries; b) inefficient customs procedures and c) divergent criteria for rules of origin classification.

Sreerupa Sengupta, Ph.D. Scholar at Centre for Economic Studies and Planning, Jawaharlal Nehru University, New Delhi discussed Trade Cooperation and Production Sharing in South Asia – An Indian Perspective. Reviewing the pattern of Indian exports and imports in the last twenty years, her research focuses on comparing the Global Value Chain (GVC) participation rate of India with East Asian and ASEAN economies. Barriers to higher participation include a) lack of openness in the FDI sector; b) lack of adequate port infrastructure, and long port dwell times; and c) lack of Mutual Recognition Agreements (MRAs).

Aamir Khan, Assistant Professor, Department of Management Sciences, COMSATS Institute of Information Technology, Islamabad presented his work on Economy Wide Impact of Regional Integration in South Asia - Options for Pakistan. His research analyzes the reasons for Pakistan not being able to take full advantage of its Free Trade Agreement (FTA) with China, and finds that the granting of ASEAN-type concessions to Pakistan in its FTA with China would be more beneficial than the current FTA arrangement. The work also draws lessons for FTAs that are currently being negotiated by South Asian countries.

Ecological restoration, critical for poverty reduction

Joaquim Levy's picture
© Mauricio Rios
© Mauricio Rios/World Bank

Why is ecological restoration so critical to the World Bank’s mission of reducing poverty and boosting shared prosperity? Quite simply, because environmental degradation is devastating to the most vulnerable communities and perpetuates poverty around the world.

Some 42 percent of the world’s poorest live on land that is classified as degraded. The situation becomes worse every year, as 24 billion tons of fertile soil are eroded, and drought threatens to turn 12 million hectares of land into desert.

Cat DDOs: More than emergency lending for disaster relief

Ede Ijjasz-Vasquez's picture
Disasters can strike anywhere and anytime. As climate change intensifies, extreme weather events, for example, are on the rise around the world, and countries are increasingly seeking to improve both their physical and financial resilience to all kind of disasters. An important dimension of sustainability in urban and rural areas is resilience–resilience for the natural disasters of today and those of tomorrow.   

One way to better prepare for disasters is securing access to financial resources before a disaster strikes through financial instruments such as the Cat DDO. 

Cat DDO stands for “Catastrophe Deferred Drawdown Option.” It is an innovative contingent line of credit that can provide immediate liquidity to countries in the aftermath of a disaster resulting from an adverse natural event. The World Bank has made it available to countries since 2008, to make it possible for them to have quick access to financial resources upon the declaration of state of emergency in the aftermath of a disaster, following an adverse natural event and in accordance with local legislation. The funds that provide liquidity to the countries are preapproved based on a sound disaster risk management program and an adequate macroeconomic framework. 

[Read: Disasters, funds, and policy: Creatively meeting urgent needs and long-term policy goals]

Why are Cat DDOs an important disaster risk financing instrument for countries?
  • It serves as an early financing tool while funds from other sources such as government reallocations, bilateral aid, or reconstruction loans/credits become available.
  • It allows the countries to address the emergency without distracting resources from their social and development programs.
  • It enhances the countries’ financial capacity to prepare for disasters.
  • It also generates or consolidates a dialogue on disaster risk management between the countries and the World Bank to learn from experience and apply good practices.

What are some of the examples of “Cat DDOs in action”? How will this innovative tool evolve to better manage increasing disaster risks? Watch a video with World Bank Senior Director Ede Ijjasz-Vasquez (@Ede_WBG) and Senior Disaster Risk Management Specialist Armando Guzman to learn more. 


 

Practicing what you preach: Mozambique’s natural resource management

André Rodrigues de Aquino's picture
The World Bank is supporting an increase in rural jobs and investment while promoting sustainable land management to conserve Mozambique’s natural wealth. Photo: Andrea Borgarello/World Bank

As my plane lands in Maputo, I am welcomed home by blankets of turquoise waters edged in creamy ribbons of sand, and swaths of greens in every shade, from scrubby mangroves to unique coastal forests endemic to Maputaland. But I also see rapidly sprawling human settlements and degraded areas where forests once flourished.


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