Syndicate content

Exporting is easy; the challenge is making it sustainable

In 2009, an EU-based chemical manufacturer opened a plant inside one of FYR Macedonia’s recently-established special economic zones. The plant began production of catalysts, a type of emissions-control component used in automobiles. Two years later, this investment drove chemical products to the third-highest spot on Macedonia’s export list, lessening the country’s reliance on metals and textiles.

In Nicaragua, low labor costs and high security compared to its neighbors have led zonas francas to expand dramatically, attracting producers of electronic wires and medical devices and expanding the country’s exports beyond an already-strong apparel sector. Between 2006 and 2008, for example, ignition wiring sets for vehicles were the country’s fourth biggest export.

These two examples demonstrate a new trend in small economies. Increasingly, as global value chains grow in importance,

Will financial disclosure by public officials mean less corruption?

Financial disclosure systems are attracting increasing attention. Can these systems credibly help to prevent corruption in public office? Can they play a useful role in detecting officials who engage in corrupt behaviors? Could they even assist in the complex global work of tracking and investigating illicit flows?

Credit: Perry French, Flickr Creative CommonsThe recently released  Public Office, Private Interests from the Stolen Asset Recovery (StAR) Initiative with data by the Public Accountability Mechanisms Initiative of the World Bank provides a practical approach to addressing the challenges and requirements of effective disclosure administration.  The overarching message is that effective disclosure is a balancing act. Yes, a disclosure system can make a meaningful contribution to corruption prevention and enforcement. But cannot do so if expected to tackle and apply sanctions for all forms of graft and corruption in public administration.

Requiring that public officials submit a signed declaration of their income, assets and business interests is on the face of it an intuitively simple way of ensuring that they think twice about seeking to profit illicitly from their public duties, or of allowing private interests to influence, appear to influence, or otherwise conflict with their official responsibilities. Fear of detection is the motivating force; a reminder of ethical obligations, and assistance in fulfilling them, the encouragement. In practice, however, this deceptively straightforward idea is very challenging to implement. 

Effects of Licensing Reform on Firm Innovation

Murat Seker's picture

Many studies since the emergence of endogenous growth theory have identified technological innovation as the main determinant of growth. There are structural factors like human and physical capital that contribute to achieving higher innovation rates. However, improving these factors is not sufficient to succeed in innovation. A country’s regulatory environment and investment climate also play important roles in the success of technology adoption strategies and innovation efforts. In a recent paper on the Effects of Licensing Reform on Firm Innovation, I provide an empirical analysis of how the regulatory environment can be crucial for innovation. The paper focuses on regulation of a particular product market that was reformed in India in the mid 1980s and then again in early the 1990s. Before the reform all firms were required to obtain a license to establish a new factory, significantly expand capacity, start a new product line, or change location. Licensing reform meant freedom from constraints on outputs, inputs, technology usage, and location choice as well as easier entry into delicensed industries. Freedom from these constraints allowed firms to take advantage of economies of scale, more efficient input combinations, and newer technologies.

Citizens In Want of Stamina

Sina Odugbemi's picture

This is the age of hopeful citizens where in almost every part of the globe citizens are mobilizing, marching and, often successfully, pushing for change. But this is also the age of increasingly frustrated citizens. In some cases, the frustration is occasioned by the failure to achieve changes in regimes even after an astonishing sequence of heroic efforts and sacrifices by citizens. In other cases, the efforts originally appeared successful. Long-entrenched dictators fell and citizens were ecstatic, believing glorious days were imminent. Yet, in many of these cases, one disappointment is jumping on top of another. Change is proving far more difficult to achieve; it is even proving elusive.

Calling young Egyptians: What YOU THINK matters

David Craig's picture
Kim Eun Yeul | 2011When I last wrote, we were launching a round of consultations out of our World Bank office in Cairo to hear from Egyptian voices on how best we support this great country in the historic transition now underway. Thanks to those of you who joined us in the great wide world of the virtual cafe. In our actual offices (and with real tea and coffee) we had meetings with political parties including the Freedom and Justice Party, the Al-Nour Party, Al-Wafd and the Egyptian Social Democratic Party.

Indonesia: A return to Aceh amidst hopes for peace and prosperity

Dini Djalal's picture

Juga tersedia di Bahasa

My first trip to Aceh was in August 1998, four months after the resignation of former President Soeharto. It was the height of Indonesia's pro-democracy Reformasi movement, and many journalists thought that travel permits were still required, as it had been for decades. My friend and I were venturing as 'tourists'. In many villages, the legacy of repression remained: razed houses, shuttered schools, and households run by widows. Poverty was unavoidable; violence and economic growth are often incompatible.

Exporting is Easy; the Challenge is Making it Sustainable

Catalyst factory in Macedonia. Source: Johnson Matthey Inc.In 2009, an EU-based chemical manufacturer opened a plant inside one of FYR Macedonia’s recently-established special economic zones. The plant began production of catalysts, a type of emissions-control component used in automobiles. Two years later, this investment drove chemical products to the third-highest spot on Macedonia’s export list, lessening the country’s reliance on metals and textiles.

In Nicaragua, low labor costs and high security compared to its neighbors have led zonas francas to expand dramatically, attracting producers of electronic wires and medical devices and expanding the country’s exports beyond an already-strong apparel sector. Between 2006 and 2008, for example, ignition wiring sets for vehicles were the country’s fourth biggest export.

Transforming Plastic Bottles into Classrooms

Myra Valenzuela's picture

Nueva Reforma - almost finished - Photo credit: Hug It Forward on Flickr In the Philippines and Guatemala, local groups have taken the mantra “Reduce, Re-use, Recycle” to a whole new level. MyShelter Foundation and Hug It Forward use discarded plastic bottles as ‘eco-bricks’ to work with local communities to build “Bottle Schools” – providing an innovative response to the problems of plastic waste and the chronic lack of educational infrastructure.

A Perfect Storm for Social Enterprises?

Ignacio Mas's picture

It’s fuzzy, it’s trendy, and it’s not even clear how new the whole concept really is. The passions triggered by the new breed of enterprises we now call social may even appear to some almost cultish.

They operate as private enterprises, often with a strong entrepreneurial and innovation culture, but claim to have a broader purpose than just maximizing financial returns for shareholders. They aim to be sustainable (i.e. commercially viable) though they don’t shun grant money from foundations and aid programs to get them started.

Interest in the social enterprise sector will continue to grow because it lies at the confluence of several powerful trends. There are three inter-linked themes: the search for new approaches to the challenges of development, the spirit of technological innovation, and growing global prosperity and integration.Muhammad Yunus is one of the world's most well known social entrepreneurs. (Credit: World Economic Forum, Flickr)

Donors and multilateral development organizations are increasingly emphasizing private sector development as the preferred path to growth. They have seen that promotion of a stable macroeconomic environment and trade liberalization by themselves may not trigger supply-side responses, and that heavy-handed government action through public enterprises and industrial policies are prone to political capture and often result in a checkerboard of local monopolies. There is therefore much interest in policies that make it easier to do business, remove obstacles to external enterprise financing, and develop a pool of skills that can be readily harnessed by a growing entrepreneurial class.


Pages