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Future Development Forecasts 2014

Shanta Devarajan's picture

We asked our bloggers and guest bloggers for their predictions for 2014. Here is a summary of seven main themes, which we will re-visit in late 2014 to see how well we did.

1. Global growth will remain robust and tapering by the U.S. Fed will be less consequential to emerging markets than expected (Bhaskaran, Zaman, Raiser).  China will do better than markets predict (Huang), and East Asia will continue to grow with relative stability (Quah). At the same time, the economic policies of some Latin American countries will bring their economies to a breaking point, causing political chaos as well (Gonzalez).  Political turmoil and conflict in the Middle East and North Africa will continue to weigh heavily on these economies, with average growth for the region below 3 percent (Devarajan). 

2. For Europe, 2014 will be a better year. 100 years after the beginning of the First World War, the Balkans will again be the focus of attention but for better reasons. A more pro-European outlook in Germany and a successful launch of negotiations with Serbia will bode well for the EU. Bosnia and Herzegovina, the scene of the assassination of heir apparent Franz Ferdinand which triggered the beginning first world war, will do surprisingly well at the World Cup in Brazil, for which it qualified for the first time ever. The joy, however, will only be short-lived because political infighting will continue to make it one of the least governable states in Europe (Fengler).

3. The steady improvement of both governance and incomes in large parts of Africa will generate greater confidence and dynamism on the continent (Kende-Robb, Quah)The creative arts (film, music, fashion, art), fueled by Africa’s changing demography, will lead the way in trade and regional integration. Congolese music, Nollywood movies and South African soap operas will sweep the continent (Kende-Robb).  However, 2014 will also become the “year of regional conflict”, with significant uptick in violence in border regions spreading out of national conflicts (Hellman).  The African Union and other sub-regional bodies will raise the profile of regional security cooperation, as ASEAN and the European Community did when they started (O'Connell). This will be one example of the potential for achieving success in fragile states (Kharas).

4. Girls in developing countries will outperform boys, especially as they move up the education ladder to secondary schools and universities (Andrabi). The incomes of the bottom 40 percent of Americans will be below that in 2000, and will have fallen in 2014 (Demombynes).

5. Mobile banking and other “leapfrog” technologies will spread widely (Kharas).  Drones (or “unmanned aerial vehicles (UAVs)”) will become a game changer for development, by dropping emergency supplies in conflict and disaster-ravaged areas and vaccines in hard-to-reach regions, not to mention natural resource mapping, surveying and animal conservation, as they are already doing in anti-poaching schemes in Nepal or Indonesia (Sanghi).

 6. As more and more economists point to the primary of politics in development, political scientists will wake up and wonder why they have been left out of the discussion. A new movement of “political contextualists” will be launched (Hellman).

 7. Either Germany (Bundervoet) or Uruguay, repeating history in Brazil (Gonzalez), will win the World Cup in football.

What are your predictions?
 

Comments

Submitted by mariamarrrr on

Hola,

Estoy interesado en el tema "", pero no puedo contestar.

¿Esta cerrado? o algo parecido...

Un saludo.

Submitted by angelica silvero on

Only an economist would assime that Uruguay could win the World Cup ;)

Submitted by Peter Quest on

Kenya's current economy will rise in a minimal margin but if the county devolution is well managed then we will see a steady economy across the country.

Submitted by wamathia on

Kenya is actually striving to attract Foreign Direct Investment inflows on a big scale more so by the Central Government for infrastructure, devolved county municipal governments mainly for expanding social services or supporting small scale county level infrastructure and the Private sector (eg Proparco France lent over KEs3billion to Chase Bank Kenya to expand her SME business , Guaranty Bank Nigeria acquired Fina Bank Kenya for over Kshs8 billon, IFC lent Equity Bank US$100m etc).
Kenya still gets over US$1 billion in remittance inflows from Kenyans in Americas and Europe diasporas.
The Nairobi Stock exchange with almost 50% foreign investor base was one of the best performing stock markets globally in 2013.
The country is targeting to issue a US$1.2 billion sovereign Eurodollar markets bond sometimes this year and this will mark the ultimate test of foreign investors confidence. Most people are optimistic the sovereign Eurodollar markets bond will be oversubscribed.
Given the ICC cases facing the President and Deputy president , the only thing with Kenya is high shift and dependence on nontraditional allies more so East and Central Africa for international trade (now at 40% of total exports from Kenya) as well as China for Infrastructure financing.
Since the ICC seems an affront to Kenya’s independence , the March 2013 General Elections became a Referendum on the ICC and majority of Kenyans voted for the current President and Deputy President in defiance of ICC and international community position on self determination and country sovereignty grounds. Most of those who defied are either aged Mau Mau war of independence veterans or children and grandchildren of Mau Mau with a high regard for self-independence and freedom of choice without the international community policing .
The ICC issue is also now viewed as a race war against Black Africans with her funders pulling strings to determine leadership structures while hidden well in the dark shadows more so after Kenya’s successful lobbying of the African Union and also given the UN Security Council refuised .
As it is Kenyans seems to overwhelmingly support the de-capitulation of the overt or covert colonial legacy exploitation links owing to traditional unfavorable balance of trade positions with Western Europe and America. There is majority support for Look East (to china) AND Loon Inside (to Africa) if Kenya is to achieve the middle income status in the next 6 years to 2020.

Submitted by Ruxandra on

Angelica, sorry, but I am also with Uruguay repeating its last win in Brazil. Signed: a lawyer :)

Submitted by Dr Nilufar Kamo... on

Thank you for sharing this . I also agree with point number 4 that is girls in developing countries outperform from boys and point number 5 mobile banking technology will spread widely.
Dr nilufar

Submitted by Max Edkins on

The global movement for climate action will grow and put pressure on governments (national, regional and local), individuals and the private sector entities to show leadership.

Submitted by Ramesh Kumar Na... on

Any discussion on the future of global Growth predictions is not complete unless we see how the international banking industry will do their business globally. Let's examine this: US and International Banks: Libor rigging allegations still continue to cost well known international banks. So what is in store for the overall banking business going forward and the impact on its sincere customers:
Year 2012/13 saw the opening up of the Pandora’s Box of banking scams (thanks to the exposure of Libor rigging fiasco [news broke in June 2012] by the well known international (sic) Barclays Bank) where many known caught up banks followed suit with the exposure for all possible type of financial rout (including FOREX manipulation) affecting the common man. All the hefty fines paid by various well known international banks (to be still paid) has left a bitter taste on their activity thereby resulting in setback for the ongoing global business and the economy. Essentially, many businesses and consumers will remain wary and uncertain in 2014 and will be reluctant to commit to major spending and investment decisions. The ongoing write down of asset values will continue and banks will have to accept credit losses thereby giving rise to small banks merging to remain sufficiently capitalized. Two types of business focus will arise from the banks:
1. Banks in the developed countries will still continue with restructuring efforts whereas, 2. Banks in developing countries will focus on growth due to the sheer size of the population (the middle class – the target sector). This class of spenders has shown that they have the necessary buying power and this is driving the economy and consumerism. How to go about this: The global banking industry needs to build “customer trust” all over again. To do this, new set of reforms are urgently needed to fundamentally reshape and rebuild the scam ridden banking industry. That there are going to be challenges in reshaping is an understatement for the banking industry, be it in the area of resolution planning, structural reforms and/or disclosure norms, etc will eventually define the approach for banks to win trust and structure their global banking activity in a sustainable and ethical way going forward.

Submitted by Ramesh Kumar Na... on

International Banks have a lot of say in the shaping of the global economy in 2014

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