With the ink barely dry on the Sustainable Development Goals, naturally the just-completed Open Government Partnership annual summit focused on how greater openness can accelerate progress toward the goals.
The open government agenda is most closely linked to the ambitious Goal 16 on Peace, Justice and Strong Institutions, which among other targets includes the objective of ensuring “responsive, inclusive, participatory and representative decision-making at all levels.” Though progress in this area is maddeningly difficult to quantify, evidence increasingly shows that participation, the next transparency frontier, matters to development outcomes. Making the target explicit, it is hoped, will galvanize efforts in the right direction.
There are many issues one could propose to tackle with citizen engagement strategies, but to narrow the topic of discussion, let’s consider just one: enabling smart growth in the world’s exploding cities and megacities.
Public Sector and Governance
Cross posted from the End Poverty in South Asia blog
It has been a season ripe with new ideas and shifts in the open data conversation. At the Cartagena Data Festival in April, the call for a country-led data revolution was loud and clear. Later in June at the 3rd International Open Data Conference in Ottawa there was an emphasis on the use of open data-beyond mere publishing.
Mulling on these takeaways, a logical question to ask may be: what would a country-focused data project that aims to put data to use look like?
Urbanization provides the countries of South Asia with the opportunity to transform their economies to join the ranks of richer nations. But to reap the benefits of urbanization, nations must address the challenges it poses. Growing urban populations put pressure on a city’s infrastructure; they increase the demand for basic services, land and housing, and they add stress to the environment.
Of all these congestion forces, one of the most serious for health and human welfare is ambient air pollution from vehicle emissions and the burning of fossil fuels by industry and households, according to the World Bank report, “Leveraging Urbanization in South Asia: Managing Spatial Transformation for Prosperity and Livability.”
Particularly harmful are high concentrations of fine particulate matter, especially that of 2.5 microns or less in diameter (PM2.5). They can penetrate deep into the lungs, increasing the likelihood of asthma, lung cancer, severe respiratory illness, and heart disease.
Data released by the World Health Organization (WHO) in May 2014 shows Delhi to have the most polluted air of any city in the world, with an annual mean concentration of PM2.5 of 152.6 μg/m3 . That is more than 15 times greater than the WHO’s guideline value and high enough to make Beijing’s air—known for its bad quality—look comparatively clean.
But Delhi is far from unique among South Asia’s cities.
Russia’s economic woes continue: the recession deepened in the first half of 2015, severely impacting households, while the economy continued to adjust to the 2014 terms-of-trade shock, which saw oil prices being halved within a few months. In addition, investment demand has contracted for a third consecutive year.
Economic policy uncertainty, arising from an unpredictable geopolitical situation and the ongoing sanctions, caused private investment to decline rapidly as capital costs rose and consumer demand evaporated.
The record drop in consumer demand was driven by a sharp contraction in real wages, which fell by an average of 8.5% in the first six months of 2015 - illustrating the severity of the recession. The erosion of real incomes significantly increased the poverty rate and exacerbated the vulnerability of households in the lower 40% of the income distribution.
So, if oil prices remain low, how can Russia grow out of its recession?
Also available in: French
This week, officials from finance ministries and leaders of the accounting profession from across Francophone Africa will gather in Dakar, Senegal from Oct 28 to 30 to chart a path forward in their countries’ development. They will focus on an area that is often ignored, but is vital to national success and prosperity: public financial management. They will focus on financial reporting, which is also known as “the way governments keep track of your money.”
This topic is important to you, citizens of the world, of the African continent. How governments manage their taxes, their borrowing, their spending, and the ways they account for these forms of transactions – income, borrowing and expenditure – are essential to economic growth, to poverty-reduction, and to ensuring that the region’s poorest can improve their lives.
In many parts of Francophone Africa, accounting practices have a lot of room to improve. In particular, financial reporting and auditing need reforms, according to ongoing research by the World Bank and others. Policy-makers do not always have accurate information about the money available to provide vital and quality public services, such as school-teachers or the construction of health clinics or roads.
All of the parties involved in public-private partnership (PPP) transactions – including both governments and project developers – frequently express concern over the time and expense involved in creating the legal agreements that are at the center of every PPP project. Everyone recognizes the importance of PPP contracts, since they are the documents that set out how the partnership will work – but there are constant calls for making the contractual drafting process quicker and less expensive.
In response, World Bank Group (WBG)’s PPP Group has launched the Recommended PPP Contractual Provisions Initiative, with the aim of developing recommended language on certain key provisions found in virtually every PPP contract. Under this initiative, the WBG’s PPP Group has produced the Report on Recommended PPP Contractual Provisions, 2015 Edition (the 2015 Report). The 2015 Report was recently submitted to, and endorsed by, the G20 Infrastructure and Investment Working Group – the committee established by the G20 Group of major economies that focuses on the financing of infrastructure projects.
Does governance matter?
Yes. Intuitively to many development practitioners, the link between governance and growth is established in the literature. But, what about hard-nosed financial investors? Is there a link between governance and financial returns? Initial cutting-edge research suggests that there is a link. And investors are increasingly paying attention to governance.
According to a study conducted by Global Evolution, an asset manager that specializes in emerging and frontier market sovereign investments, shows that governance may be a significant driver of sovereign bond returns. According to Ole Hagen Jørgensen, Research Director of Global Evolution, “improvements in a country’s Environmental, Social, and Governance (ESG) scores – and particularly the “G” of governance – significantly correlate to pricing of risk, credit ratings and return generation of sovereign bond funds in emerging and frontier markets.”
Cities are the future. They are where people live and work. They are where growth happens and where innovation takes place. But they are also poles of poverty and, much too often, centers of unemployment.
How can we unleash the potential of cities? How do we make them more competitive? These are urgent questions. Questions, as it turns out, with complex answers – that could potentially have huge returns for job creation and poverty reduction.
Cities vary enormously when it comes to their economic performance. While 72 percent of cities grow faster than their countries, these benefits do not happen uniformly across all cities. The top 10 percent of cities increase GDP almost three times more than the remaining 90 percent. They create jobs four to five times faster. Their residents enjoy higher incomes and productivity, and they are magnets for external investment.
We’re not just talking about the “household names”among global cities: Competitive cities are often secondary cities, many of them exhibiting success amidst adversity – some landlocked and in lagging regions within their countries. For instance, Saltillo (Mexico), Meknes (Morocco), Coimbatore (India), Gaziantep (Turkey), Bucaramanga (Colombia), and Onitsha (Nigeria) are a few examples of cities that have been competitive in the last decade.
So how do cities become competitive? We define competitive cities as those that successfully help firms and industries create jobs, raise productivity and increase the incomes of citizens. A team at the World Bank Group spent the last 18 months investigating, creating and updating our knowledge base for the benefit of WBG’s clients. In our forthcoming report, “Competitive Cities for Jobs and Growth,”* we find that the recipe includes several basic ingredients.
In the long term, cities moving up the income ladder will transform their economies, changing from “market towns” to “production centers” to “financial and creative centers,” increasing efficiencies and productivity at each stage. But economic data clearly shows there are large gains to be had even without full-scale economic transformation: Cities can move from $2,500 to $20,000 in per capita income while still remaining a “production center.” In such cases, cities become more competitive at what they already do, finding niche products and markets in tradable goods and services. Competitive cities are those that manage to attract new firms and investors, while still nurturing established businesses and longtime residents.
What sort of policies do competitive cities use? We find that leading cities focus their energies on leveraging both economy-wide and sector-specific policies. In practice, we see how successful cities create a favorable business climate and target individual sectors for pro-active economic development initiatives. They use a combination of policies focused on cross-cutting issues such as land, capital markets and infrastructure, while not losing focus on the needs of different industries and firms. The crucial factor is consultation, collaboration and partnerships with the private sector. In fact, success also involves building coalitions for growth with neighbors and other tiers of government.
- urban competitiveness
- sustainable cities
- Trade and Competitiveness
- Private sector competitiveness
- competitive cities
- Competitive Sectors
- Competitive Industries
- Financial Sector
- Labor and Social Protection
- Public Sector and Governance
- Social Development
- Urban Development
- Private Sector Development