- Sure, that intervention delivered great results in a well-managed pilot. But it doesn’t tell us anything about whether it would work at a larger scale.
- Does this result really surprise you? (With both positive results and null results, I often hear, Didn’t we already know that intuitively?)
Not so long ago, 15 years to be exact, I remember when people in the districts of Kandahar used animals to transport their agricultural harvest to the provincial center. There were a few, if any, motorable roads, and we had a limited number of health centers and schools in the province. Most of the infrastructure laid in ruins. But worst of all, the economic condition of the average Afghan was quite bad with little or no access to income, opportunities, and facilities.
Things have changed since 2003. While many development projects have been implemented in Kandahar Province, the National Solidarity Programme (NSP) has been one of the most popular and high impact. Running from 2003 to 2016, NSP was implemented in 16 of 17 districts and set up 1,952 Community Development Councils (CDCs), which implemented over 3,300 projects.
In Kandahar, communities are very conservative, and, overall, the province is highly traditional. When the program was launched, people in Kandahar were not interested in establishing CDCs through holding elections at the village level.
Compared to their investment needs, developing countries have very limited concessional financing available to them. International commercial banks are constrained in terms of the size and tenors of credits to Emerging Markets and Developing Economies. A key challenge therefore, is to channel large savings and capital into productive investments in developing countries, partly by ‘de-risking’ investments and borrowings. Pakistan is at the forefront of these efforts, recently making use of two World Bank guarantees to access over 1 billion US dollars in two international commercial loan financings.
A $420 million IBRD Policy Based Guarantee (PBG) was approved by the World Bank Board alongside a $500 million IDA credit in June 2016. The PBG guarantee partially takes over the risk of a commercial bank’s loan to a government. The PBG and the IDA credit supported a program of reforms including the adoption of a new and more inclusive poverty line, efforts to broaden the tax base, enhanced transparency of State Owned Enterprises, improved debt management and a significant overhaul of the regulatory framework of the financial sector. Improved access to international financing through the PBG will reduce the government’s dependence on domestic financing and free up resources for private sector investment. The guarantee also signals the World Bank’s confidence in Pakistan’s economic reforms program – a signal that is particularly important after the successful completion of the IMF program. The government used the US$420 million PBG to partly guarantee a 10-year US$700 million loan, extending tenor significantly and achieving cost savings.
In his “The People of the Abyss,” novelist Jack London describes in grim detail a devastating storm that rocked London in the early 20th century. Residents suffered terribly—some losing as much as £10,000, a ruinous sum in 1902—but none lost more than the city’s poorest.
Natural disasters are devastating to all affected; however, not everyone experiences them the same way. A dollar in losses does not mean to a rich person what it does a poor person, who may live at subsistence level or lack the means to rebound and rebuild after disaster strikes. Be it a drought or flood, the poor are always hit harder than their wealthier counterparts.
This disparity was closely examined in the Global Facility for Disaster Reduction and Recovery (GFDRR) report, Unbreakable: Building the Resilience of the Poor in the Face of Natural Disasters. Unbreakable recommended a range of policies to help countries reduce poverty and build resilience, providing cutting-edge analysis on how disaster risk management (DRM) and well-designed development can alleviate poverty and risk in 117 countries.
This post is co-authored with Tim Wainwright, Chief Executive, WaterAid and Neil Jeffery, Chief Executive Officer, Water & Sanitation for the Urban Poor and was originally published on the Financial Times’ BeyondBrics Blog.
Mollar Bosti is a crowded slum in Dhaka, Bangladesh, home to 10,000 people: garment workers, rickshaw drivers, and small traders, all living side-by-side in tiny rooms sandwiched along narrow passageways.
With the land subject to monsoon flooding, and no municipal services to speak of, the people of Mollar Basti have been struggling with a very real problem: what to do with an enormous and growing amount of human faeces.
Traditionally, their ‘hanging latrines’ consisted of bamboo and corrugated metal structures suspended on poles above the ground, allowing waste to fall straight down into a soup of mud and trash below. Residents tell stories of rooms flooded with smelly muck during monsoons; outbreaks of diarrhoea and fever would quickly follow.
But conditions have improved for much of the slum. With help of a local NGO, the residents negotiated permission for improvement from a private landowner, and mapped out areas of need. Today, they proudly show visitors their pristine, well-lit community latrines and water points. They report fewer problems with flooding and disease.
When people spend money, their decisions are often influenced by the desire to signal wealth and attain social status. This insight is not entirely new – even Adam Smith, in the Wealth of Nations, complains that his contemporaries spend too much on “status goods” that are not a necessity of life, and which they most likely can’t afford.
Social signaling motives in consumption seem to be present in many different economic settings, and may in fact be so widespread that they can be linked to larger economic phenomena, such as inequality and persistent poverty. Studies using household surveys show, for example, that the poor around the world spend a strikingly large share of their income on visible expenditures, which may have negative implications for asset accumulation, household indebtedness, and investments in education.The same pattern has been shown to hold for ethnic minorities in the Unites States – so much so, that a recent study argues that differences in conspicuous consumption may account for as much as one third of the wealth gap between Whites and African Americans
A new report by the World Health Organization (WHO) shares some good news: Six in 10 people worldwide are now protected by at least one of the WHO Framework Convention on Tobacco Control (FCTC)-recommended demand reduction measures, including taxation. The report, launched on the sidelines of the UN high-level political forum on sustainable development, also makes clear that raising taxes to increase tobacco product prices is the most cost-effective means to reduce tobacco use and prevent initiation among the youth. But it is still one of the least used tobacco control measures.
As we discussed in our previous post, Global Value Chains can lead to the creation of more, inclusive and better jobs. . However, there is a potential trade-off between increasing competitiveness and job creation, and the exact nature of positive labor market outcomes depends on several parameters. Given the cross-border (and, therefore, multiple jurisdictive) nature of GVCs, national policy choices to strengthen positive labor outcomes are limited. However, national .
Last week, I represented the World Bank Group at the United Nations Security Council on the famine response in Nigeria, Somalia, South Sudan and Yemen. In these four countries, more than 20 million people face famine or the risk of famine over the coming six months, and urgent action is needed to prevent the situation from deteriorating further.
The Security Council may appear to be an unusual place to find a development institution such as the World Bank, especially regarding a humanitarian crisis like famine.