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Financial Sector

Engaging Egyptians Abroad for Investment: What Will it Take?

Stefanie Ridenour's picture

Engaging Egyptians Abroad for Investment: What Will it Take?

Following the ousting of Hosni Mubarak in 2011, many Egyptian expatriates turned towards their home country with a renewed sense of hope and desire to participate in the change process. As the political and economic transition is underway, many Egyptians abroad are looking for ways to engage in the transition period, and donors and development agencies are trying to effectively channel their efforts to contribute to development outcomes.

 

A Data-driven Perspective on Islamic Finance

Leora Klapper's picture

A Data-driven Perspective on Islamic Finance

To some, Sharia-compliant financial services offer a promising path towards expanding financial inclusion among Muslim adults. To others, these services – which avoid charging interest and seek to conform to Islamic principles of profit- and loss-sharing – do not address the root causes of financial exclusion. But most agree that there is a dearth of empirical research that measures the degree to which Muslims are using Sharia-compliant financial products, their demand for it, and the extent to which they refrain from using conventional financial systems. Without data and related analysis, policymakers and private sector leaders are often speculative in framing the role of Islamic finance within the financial inclusion agenda.

 

'Project Greenback 2.0 – Remittance Champion Cities' Launched in Turin, Italy

Massimo Cirasino's picture

"Project Greenback 2.0 – Remittance Champion Cities" was launched on October 29 in Turin, Italy.

A team from the World Bank's service line on Financial Infrastructure, hosting the launch event, was thrilled to welcome a room full of migrants, market paricipants, public officials, policy researchers and private-sector observers.

Since March 2013, in partnershp with the Turin city government, the World Bank team has been preparing for the launch of Project Greenback 2.0, which aims to foster the development of a sound and efficient market for remittances. The project pursues an important new approach: It focuses on remittance senders, and its priority is meeting their needs.

In the first months of our efforts in Turin, we have been working on a survey among remittance senders, and we have been mapping and monitoring the services that are available to them when they seek to send money home. The survey focused on Romanians, Moroccans and Peruvians – the most numerous immigrant groups in Turin, who together account for more than 60 percent of the city's immigrant population.

Innovation and Insurance: Protection Against the Costs of Natural Disaster

Olivier Mahul's picture

Natural disasters – such as tsunamis, earthquakes, cyclones and floods – are costly to society, in terms of both human destruction and financial losses. Governments ultimately bear the full cost of the havoc wreaked by natural disasters, which can create an enormous strain on limited government budgets, especially in developing countries. This is even before we begin to contemplate the development impact and how the poorest of the poor are disproportionately affected.

Just last week, the world saw the widespread damage that the St. Jude storm inflicted across Europe, and we witnessed its effect on hundreds of thousands of people. Most advanced economies, however, have sufficient capacity to be able to absorb the financial losses inlicted by natural disasters. Higher-income countries enjoy (relatively) efficient public revenue systems and developed domestic insurance markets.

By contrast, developing countries do not have the same degree of access to financial and insurance markets. They face limited revenue streams, limited fiscal flexibility, and limited access to quick liquidity in the wake of an event. This is particularly so for Small Island Developing States (SIDS), such as the Pacific island nations.

Will a return to political stability solve the economic problems in the Middle East and North Africa?

Elena Ianchovichina's picture

Will a return to political stability solve the economic problems in the Middle East and North Africa?

In the three years since the Arab Awakening of late 2010, the Middle East and North Africa (MENA) has seen an increase in conflict and political instability, on the one hand, and a deteriorating economic situation, on the other.  Given the vicious cycle between economic hardship and conflict, it is natural to ask whether a return to political stability will restore prosperity in the region.

The Piracy Money Cycle: ‘Trickle-Round Economics’

Stuart Yikona's picture

Sitting in a safe house, an ocean away, three former pirates reflect on their past lives as ”footsoldiers” aboard  skiffs preparing to attack unsuspecting cargo vessels off the Horn of Africa. Our research team is transfixed by their stories.
 
We listen as they describe to us how they got involved in the piracy business, how much they earned, how they spent their money and, perhaps most interesting, what they know about their ”masters” – the pirate financiers, investors and negotiators.
 
These footsoldiers were merely small fish in a big sea.  They would be sent out to hijack shipping vessels, which would only be returned to the ships’ owners for a hefty ransom.
 
Following research for our report   “Pirate Trails,” studying acts of piracy off the Horn of Africa, we estimate  that between US$339 million and US$413 million was handed over  in ransom payments between April 2005 and December 2012.  The exact amount is very hard to pin down, given the reluctance of the shipping companies and pirates to reveal the cost and rewards of piracy.

Islamic Finance Grabs Headlines in London and Istanbul

Abayomi Alawode's picture

Talk about timing! This week has seen back-to-back initiatives that underscore the growing importance of Islamic finance – and the significant role that the World Bank Group can play in unleashing its potential for financing international development.

This Tuesday, October 29, Prime Minister David Cameron of the United Kingdom announced that the U.K. will become the first non-Muslim country to issue a Sukuk or Islamic bond, with a £200 million issue planned for early 2014. Cameron also announced plans for a new Islamic index on the London Stock Exchange. These initiatives are all part of a grand plan by the U.K. government to turn London into a global capital of Islamic finance.

The very next day, on Wednesday, October 30, World Bank Group President Jim Kim inaugurated the World Bank Global Islamic Finance Center in Istanbul. Envisioned as a knowledge hub for developing Islamic finance globally, the center will conduct research and training as well as provide technical assistance and advisory services to World Bank Group client countries interested in developing Islamic financial institutions and markets.

Getting the remittance system right for Africa?

Soheyla Mahmoudi's picture

The remittances sent home every year by the African Diaspora should create a doorway to still greater opportunities, and the key to this door is financial access. While remittances do impact the living standards of beneficiaries directly, the banks that pay out the remittances month after month should offer recipient families a basic financial package including savings accounts, payment services and small loans for microenterprise.  This should facilitate growth from current levels of remittances saved and invested.  Leveraging of remittances through financial inclusion is certain to increase their development potential.

Running a Horse Race Among Institutions for Investment

Jamus Lim's picture

The variation in investment among developing countries is truly remarkable. Over the course of the 30-year period between 1980--2010---a period of relative calm in the global economy that is often referred to as the "Great Moderation"[*]---the investment rate in developing countries ranged from a whopping 90 percent (Armenia in 1990) to a dismal 1 percent (Liberia in 2003). This variability is more than twice that of variance in economic growth---a topic that has preoccupied many more generations of researchers---and much of this variability stems from the developing world.


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