In 2014, the World Bank issued a highly relevant and timely report titled Risk and Opportunity: Managing Risk for Development. This report analyzed the growing number of heterogenous risks and opportunities affecting developing countries. A clear challenge in finding a consistent risk management strategy stems from the sharp differences in the risks faced by developing countries; for example, commodity price shocks, financial crises, and natural disasters have all different defining characteristics. While we could tailor risk management strategies to each one of these types of risks, not having the benefit of a unifying framework can lead to mistakes and mismanagement of the scarce resources available to developing nations to deal with these potentially disastrous events. Five years after the publication of the report, in a time of growing macroeconomic headwinds for emerging markets and higher exposure to natural disasters, understanding the risks faced by these economies and how to effectively manage them continues to be a key policy challenge.
If, like me, you’re a firm believer in New Year’s resolutions, early January ushers in the prospect of renewed energy and exciting opportunities. And as tradition has it, it’s also a time to enter the prediction game.
To sum up:
Notably, and despite increasing conflicts and growing fragility, Afghanistan is expected to increase its growth to 2.7 percent rate this year.
In this otherwise positive outlook, Pakistan’s growth is projected to slow to 3.7 percent in fiscal year 2018-19 as the country is tightening its financial conditions to help counter rising inflation and external vulnerabilities.
However, activity is projected to rebound and average 4.6 percent over the medium term.
In the Africa Chief Economist’s Office, we seek to generate knowledge on key development issues around the continent. We also host the Gender Innovation Lab, which – as the name suggests – specifically generates evidence on how to close the gender gap in Africa. Over the course of 2018, we’ve produced a range of products (regional reports and updates), but we also produce academic articles and book chapters seeking to answer key, specific development questions.
Institutional investors increasingly hold the world’s purse strings, with a growing share of private savings. What will it take for financiers to allocate more of that capital in ways that align with development goals—in the long-term investments, particularly in infrastructure, that are needed to help lift more people out of poverty and boost shared prosperity?
To answer that question, the World Bank Group and the Government of Argentina convened the first ever Investor Forum on the eve of the G20 Summit in Buenos Aires. The Investor Forum brought together investors holding over $20 trillion dollars of assets, finance experts, government representatives, and development partners for a frank and practical conversation.
“Private capital is often an important source of sustainable finance. Public finance alone may not be sufficient to meet the demands for sustainable finance as the global economy continues to grow and poses increasing burdens on our resources and ecosystems. Mobilizing private investment in areas such as sustainable infrastructure, sustainable technologies and business model innovations, among others, can deliver substantive environmental, social, and economic benefits.”
This summary from the G20’s Sustainable Finance Synthesis Report was at the heart of the discussion at the Investor Forum, which was held on the sidelines of the G20 Summit in Buenos Aires in November. The event – hosted by the World Bank and the Government of Argentina – brought together investors holding over $20 trillion of assets as well as stakeholders and representatives from G20 governments. The goal was to identify steps for boosting long-term, sustainable, private-sector investments that tackle development challenges and promote economic growth in parts of the world that need it most.
In October, hundreds of representatives of civil society organizations, public and private sector representatives, journalists and international organizations gathered in Copenhagen for the 18th International Anti-Corruption Conference. This annual conference is viewed by many as a leading forum in the field of anti-corruption.
The irony was hard to miss.
Last month, leaders from the public and private sectors, civil society, international organizations, academia, and the media met at the International Anti-Corruption Conference (IACC) in Copenhagen.
Sustainability is the holy grail of development. There are many interventions that yield positive results in the short term but somehow fail to be sustained over time. This is why the experience in Guatemala that we are about to describe is worth paying attention to. In short, it shows that behavioral insights can lead to lasting change.
It all began in 2012 in the United Kingdom, with simple changes in the reminder letters sent to taxpayers that were late in their income tax payment. The changes were very successful, inducing payments of 4.9 million pounds (around $6.5 million) in a sample of almost 120,000 delinquent taxpayers, which would not have been raised without the intervention. The then-nascent institution called the "Behavioral Insights Team" (BIT) became known around the world with this effective and very low-cost intervention that was based on modifying the messages of the letters sent to delinquent taxpayers. The message that was most effective said: "Nine out of ten people in the U.K. pay their taxes on time. You are currently in the very small minority of people who have not paid us yet."
Tech startups and business angels are not what comes to mind when thinking of the Czech Republic (CR). Instead, this small central European country is known for its beer, scenic bridges crossing the Vltava river, and existential writers. Not so easy to add “vibrant entrepreneurial hub” to the list as it celebrates the 100th anniversary of Czechoslovakia. Nevertheless, that's exactly what the CR policymakers intend to do.
CR has what it takes to be an entrepreneurial hub for Central Europe