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Private Sector Development

New Voices in Investment: How Emerging Market Multinationals Decide Where, Why, and Why Not to Invest

Gonzalo Varela's picture

Emerging market multinationals (EMMs) have become increasingly salient players in global markets. In 2013, one out of every three dollars invested abroad originated from multinationals in emerging economies.

Up until now, we have had a limited understanding of the characteristics, motivations, and strategies of these firms. Why do EMMs decide to invest abroad? In which markets do they concentrate their investments and why? And how do their strategies and needs compare to those of traditional multinationals from developed countries?

In a book we will launch tomorrow at the World Bank, “New Voices in Investment,” we address these questions using a World Bank and UNIDO-funded survey of 713 firms from four emerging economies: Brazil, India, Korea, and South Africa.

Notes From the Field: Using Trade Diagnostics to Identify Opportunity in Burkina Faso

Miles McKenna's picture
Members of the Cooperative Agriculture Maraicher for Boulbi, nurture their fields of vegetables, as they water and hoe the fields on November 8, 2013 in Kieryaghin village, Burkina Faso. Source - Dominic Chavez/World Bank

Editor's Note: "Notes From the Field" is an occasional feature where we let World Bank Group professionals conducting interesting trade-related projects around the globe explain some of the challenges and triumphs of their day-to-day work. The views expressed here are personal and should not be attributed to the World Bank Group. All interviews have been edited for clarity.

The interview below was conducted with Mariam Diop, a Senior Economist with the World Bank Group. Mariam is based in the country office in Ouagadougou, the capital of Burkina Faso, where she carries out work in the WBG’s new Macro and Fiscal Management Global Practice. Mariam has been deeply involved with the country’s Diagnostic Trade Integration Studies (DTIS), which has helped to identify a number of key restraints on economic growth and shared prosperity in Burkina Faso. The Trade Post spoke with Mariam about what brought her to the country, where she sees opportunities, and how the DTIS has helped on the ground.
 

Trade and Development Leaders Discuss the Benefits of Global Value Chains

Julia Oliver's picture

Airplane engine. Photo - Doug Zwick/Flickr Creative Commons license.A business processing center in Riyadh that is run by women.

An e-commerce company that helps farmers develop transport companies to deliver packages to remote, rural areas of China.

An airplane engine designed in Turkey, constructed in North America, and used all over the world.

Each of these innovations emerged from a modern trend in trade – global value chains – that was the subject of discussion Friday at “Transforming World Trade: Global Value Chains and Development,” a flagship event of the Annual Meetings hosted by the World Bank Group and the International Monetary Fund. At issue: what are the implications of this trend for poverty and development?

The panelists included World Bank Group President Jim Yong Kim, World Trade Organization (WTO) Director-General Roberto Azevêdo, General Electric Company Vice Chairman John Rice, and Colombian Minister of Finance and Public Credit Mauricio Cárdenas.  Anabel Gonzalez, Senior Director of the World Bank Group’s Trade and Competitiveness Global Practice, moderated the discussion. The vantage points ranged widely, but all panelists seemed to agree: Global value chains hold promise for the poor.

On the Strength of Avocados and Airplane Parts: Making Global Value Chains Work for Development

Daria Taglioni's picture

Also available in: Español

In Chile, producers incorporated procedures that increased the quality of their avocados, thereby increasing their profit margins. Photo - Kristina/Flickr Creative Commons License.By now, developing countries are exporting parts and components used in some of the most sophisticated products on the planet. With the rise of global value chains (GVCs), workers in these countries are no longer just assembling imported parts for local sale, as has been done for decades. They are now participants in international production networks – in factories that cross borders.
 
This change is significant for economic development, as we argue in our forthcoming book, “Making Global Value Chains Work for Development.” GVCs will also be the subject of a discussion by World Bank Group President Dr. Jim Yong Kim, World Trade Organization Director-General Roberto Azevêdo, General Electric Vice Chairman John G. Rice, and Colombia Minister of Finance and Public Credit Mauricio Cárdenas -- and moderated by World Bank Trade and Competitiveness Senior Director Anabel González -- on Friday at “Transforming World Trade: Global Value Chains and Development,” a flagship event of the World Bank-IMF Annual Meetings.

Helping Small Business To Be an Engine of Growth and Employment

Anabel Gonzalez's picture

Man arranging bananas by the road. Malita, Davao City, Philippines. Photo - Kate Bacungco / World BankIn developing countries, small businesses employ a disproportionate share of the population: SMEs comprise two-thirds of formal private sector employment in emerging markets and create 95 percent of jobs in low income countries. They take many forms, from mobile food vendor to technology firm, and they can be incubators of creativity. But, as studies have shown, on average, they account for a smaller share of productivity growth than large firms.

This week I am in Kigali, Rwanda, to participate in the World Export Development Forum. Its theme is: “SMEs: creating jobs through trade.” At this forum, government and business leaders will discuss the role of SMEs in international trade and strategies for increasing their participation. I will speak about the work the World Bank Group is doing to help improve the conditions for SME competitiveness and their integration into the global economy.

Haïti : de l’impact positif des échanges sur le redressement du pays et son essor économique

Calvin Djiofack Zebaze's picture

A busy Haitian market. Source - Glenda PowersL’horizon semble se dégager pour Haïti, qui poursuit son redressement depuis le séisme dévastateur de 2010. Et cela, grâce (en partie) au commerce extérieur.
 
Les autorités haïtiennes le savent qui s’emploient, avec le Groupe de la Banque mondiale et d'autres donateurs, à identifier les obstacles aux échanges pour les démanteler et doper ainsi les secteurs exportateurs.
 
Au début du mois, une équipe de la Banque mondiale s’est rendue à Port-au-Prince pour une semaine de travail avec les principaux acteurs, publics et privés, de la logistique commerciale du pays, notamment des représentants du ministère du Commerce et de l'Industrie. L’objectif ? Discuter de solutions pour renforcer le programme de facilitation des échanges du pays, financé par un fonds fiduciaire multidonateurs conçu pour aider les pays en développement à renforcer leur potentiel économique et à lutter contre la pauvreté grâce au commerce.
 

How Trade Is Helping Haiti Recover and Grow its Economy

Calvin Djiofack Zebaze's picture

 Sun rising behind clouds in Haiti. Source - Yinan ChenThings are looking up in Haiti as the country continues to rebuild from the devastating 2010 earthquake. And part of this progress is a story of trade.

The Haitian government recognizes this, and is working with the World Bank Group and other donors to identify and remove barriers to trade to better promote export growth.

A World Bank team traveled to Port au Prince earlier this month for a week long workshop with the main stakeholders (public and private) intervening on trade logistic in the country, including the Ministry of Commerce and Industry, in order to discuss ways to strengthen the Haitian Trade Facilitation (TF) program. The program is funded through the Trade Facilitation Facility, a multi-donor trust fund dedicated specifically to helping developing countries realize economic development and poverty reduction through trade.
 

Competitiveness is Key to Trade and Development in Africa

Anabel Gonzalez's picture
Textile factories are an important source of employment in Lesotho, which benefits from the AGOA agreement. Photo credit: John Hogg / World Bank. As World Bank President Jim Kim told the African leaders who gathered in Washington for the U.S.-Africa Leaders Summit this week: African countries have enormous potential to increase trade, drive growth, reduce poverty, and deliver jobs. They face constraints, to be sure, but the World Bank Group is working with our African partners daily to improve the competitiveness of their industries and boost the volume and diversity of their trade with the rest of the world.

At a high-level meeting at the World Bank on Monday, African ministers and delegations representing 51 countries had a pressing concern: the renewal and modernization of the African Growth and Opportunity Act (AGOA). A preferential program that enhances the access of qualifying African countries to the US market, the law is due to expire in September 2015.

What Will the Trade Facilitation Agreement Mean for the Aid for Trade Agenda? New e-Book Provides Answers

Jaime de Melo's picture

The world’s 45 Least Developed Countries that are not oil producers (non-oil LDCs) are exporting less and less in the global market place. Between 1985 and 2012, the world market share of non-oil LDCs’ exports of goods and services fell from 1.2 percent to 0.8 percent—all while their share in world population rose from 7.5 percent to 9.9 percent.

The 2005 Aid for Trade (AFT) initiative was designed to arrest this decline. Yet, LDCs’ trade costs continue to fall less rapidly than those of their competitors.

Clearly, it’s time to re-evaluate the AFT initiative.

A new e-book does just that, and, contrary to what some may think, concludes that the initiative has been beneficial. But due to a collective failure to clearly articulate its results, the achievements of the AFT initiative are now at risk as development budgets come under increasing pressure.

Video: Area C and the Future of the Palestinian Economy

Miles McKenna's picture
World Bank trade economist Massimiliano Calì recently broke down how conflict, the destruction of capital, and restrictions can lead fragile states into large trade deficits and aid dependence. He called it "The Fragile Country Tale." The video below illustrates this tale in Area C of the Palestinian West Bank, and shows us how things could be different. Check it out...
 
Area C and the Future of the Palestinian Economy

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