Editor's Note: Below is a viewpoint from Chapter 6 of the Foresight Africa 2018 report, which explores six overarching themes that provide opportunities for Africa to overcome its obstacles and spur inclusive growth. Read the full chapter on the changing nature of Africa's external relationships here.
. The compact brings together interested African countries with the World Bank Group, the International Monetary Fund, the African Development Bank, and other multilateral and bilateral partners to develop and support policies and actions that are essential for attracting private investment. To date, 10 countries have signed up for the initiative and outlined their aspirations and reform programs under a framework adopted by the G-20 finance ministers in March 2017.
Download the January 2018 Global Economic Prospects report.
The 2014-16 collapse in oil prices was driven by a growing supply glut, but failed to deliver the boost to global growth that many had expected. In the event, the benefits of substantially lower oil prices were muted by the low responsiveness of economic activity in key oil-importing emerging markets, the effects on U.S. activity of a sharp contraction in energy investment and an abrupt slowdown in key oil exporters.
Biggest drop in oil prices in modern history
Between mid-2014 and early 2016, the global economy faced one of the largest oil price declines in modern history. The 70 percent price drop during that period was one of the three biggest declines since World War II, and the longest lasting since the supply-driven collapse of 1986.
Real oil prices
Source: World Bank.
Notes: Real oil prices are calculated as the nominal price deflated by the international manufacturers unit value index, in which 100=2010. World Bank crude oil average. Last observation is November 2017.
A new project combining skills across the World Bank Group and IFC is taking advantage of disruptive advances in the energy and finance sectors to address these longstanding challenges for SMEs.
Current access to electricity remains woefully low and is a major impediment to economic growth. More than half of Africa’s population isn’t connected to the energy grid and has no access to reliable power. At the same time, fewer than 50% of adults have an account with a formal financial institution.
In recent years, however, two important developments have made it possible to begin addressing these challenges:
- Off-grid energy solutions—notably solar power—have fallen dramatically in price with new business models working to scale them
- New digital-based financing mechanisms, such as crowdfunding, cryptocurrencies, peer-to-peer lending, psychometric testing, big data, and blockchain have emerged as tools for under-served finance markets.
There are strong parallels in these advances for both sectors. Whereas both energy and finance are traditionally provided by large-scale, centralized service providers—state-owned electricity utilities and large commercial banks, respectively—new solutions have effectively decentralized and democratized the provision of these services. Now a range of smaller,
How does my pension fund invest my money? More and more people around the world are asking this question. As the global population ages, it has becoming increasingly important to ensure that pension funds are efficiently and effectively managed so they can deliver a secure income in retirement.
At the same time, countries require more investment in productive areas such as infrastructure, housing and new businesses to continue to grow.
Globally, pension funds have some US$38 trillion in assets under management; the world’s 300 largest pension funds manage around $16 trillion. This ranges from the Government Pension Investment Fund (GPIF) in Japan -- the largest pension fund in the world with $1.3 trillion in assets -- to funds such as the Government Institutions Pension Fund (GIPF) in Namibia which, though smaller in absolute terms (owning $7 billion), constitutes almost 70% of domestic Namibian GDP.
When we talk about the future of work, it is important to include perspectives, ideas and solutions from young people as they are the driving force that can shape the future. As we saw at the recent Youth Summit 2017, the younger, digitally-savvy generations —whether they are called Millennials, Gen Y, or Gen Z— shared solutions that helped tackle global challenges. The two-day event welcomed young people to discuss how to leverage technology and innovation for development impact. In this post, we interviewed —under a job-creation perspective—finalists of the summit's global competition.
- private sectors
- Social Entrepreneurship
- Youth Summit
- Agriculture and Rural Development
- Labor and Social Protection
- Information and Communication Technologies
- Global Economy
- Financial Sector
- Climate Change
- Latin America & Caribbean
- South Asia
- East Asia and Pacific
- South Africa
I had the privilege recently to spend an unscheduled hour of discussion with a group of young Tunisians who were visiting our offices. As often, on these occasions it is hard not to get captured by the energy and impatience of the young people in this region. It gives hope that entrepreneurial spirit is really alive and well in a country where reliable private sector services remain otherwise hard to come by, let alone public ones. If one combines the energy of youth with the message in a recent (equally energetic) speech by the Minister of Development to a large group of investors, one gets a sense that Tunisia is, indeed, looking ahead and not to the past.
Yet, as always, reality is far more complex, and often we are confronted with a much gloomier picture of a country that is perceived as, economically, turning inward. This is the case even more so now, as Tunisia is coming under immense pressure to get its public finances in order. This has generated some decisions that go right against the message of openness and dynamism that one gets when meeting with young Tunisians. It all begs the question, for a newcomer like myself, which of the parallel universes is the real one, and, as in a movie, which one ultimately will prevail.
Public credit guarantees have become a popular instrument to expand lending to small and medium enterprises (SMEs). More than 30 percent of credit guarantee schemes around the world have some form of state ownership. Public credit guarantee schemes are particularly important in developing countries, where they are the main type of guarantee scheme.
Tomorrow, on December 12, 2017, exactly two years after the signing of the historic Paris Agreement, the government of France will be hosting the One Planet Summit in Paris to reaffirm the world’s commitment to the fight against climate change.
At the summit, mayors from cities around the world, big and small, will take center stage with heads of state, private sector CEOs, philanthropists, and civil society leaders to discuss how to mobilize the financing needed to accelerate climate action and meet the Paris Agreement goals.
A slew of programs announced in recent years have fostered a more favorable business environment for financial technology – or fintech – models to emerge in the MSME lending space – in India.