Mr. Sanjeev Gupta, Ms. Catherine A Pattillo, and Mr. Kevin J Carey
Are improvements in growth in Sub-Saharan Africa (SSA) since the mid-1990s sustainable? What types of growth strategies contribute the most to reducing poverty? This paper examines these questions in four stages. First, it explores the factors contributing to the post- 1995 improvement in growth. Second, to shed some light on factors associated with substantial jumps in growth rates that are sustained in the medium term, an analysis of the correlates of growth accelerations is presented. Third, the paper examines the consistency of the SSA data with some important predictions from the literature directly linking such areas as fiscal policy, financial development, or institutions and growth. Fourth, it reviews recent evidence regarding lessons on the type of growth process that is most effective at raising the incomes of the poor.
SSA, all countries
SSA, benchmark countries
Source: IMF staff estimates.
C. Explaining Public Investment Efficiency
9. This section tries to identify the main factors explaining public investment efficiency in WAEMU . Albino-War et al (2014) , Grigoli and Mills (2014) and Gleb and Grassman (2010) found that countries with weak institutional quality, governments may use capital spending as a vehicle for rent-seeking leading to inefficient public investment. Based on panel
This Selected Issues paper examines growth, structural transformation, and diversification in Mali. At present, the majority of Mali’s population is employed in low-productivity agriculture, and the secondary sector is underdeveloped. Further structural transformation and diversification of output and exports could thus yield significant growth dividends, but will be challenging in the context of a rapid projected increase in the workforce over coming decades, much of which would need to be absorbed by the agricultural sector. Policies could focus on easing the constraints to structural transformation in key areas such as education and the business climate, as well as devising a clear strategy for tackling the challenges posed by rapid population growth.
: Doing Business
10. A thought experiment highlights how the region’s overall ranking would improve if all WAEMU countries caught up in one area to benchmark levels, other things equal . The exercise aims at emphasizing areas in which reform efforts could yield particularly high gains in terms of the relative ranking. To this end, the values of each sub-category of the Doing Business ranking are replaced with better SSAbenchmark country averages for each WAEMU which is lagging behind. The results show that simplifications in taxation and registration of property
This Selected Issues paper on West African Economic and Monetary Union presents external stability assessment report. The current account deficit declined in 2014. Although gross international reserve coverage has increased slightly, part of the current account deficit has been financed by a decline in commercial banks’ net foreign assets. Contingent on the implementation of government’s consolidation plans, and helped by a favorable oil price outlook, the current account deficit would further gradually decline and be matched by enough financial inflows in the medium term. According to various metrics, the real exchange rate appears to be broadly aligned with fundamentals. International reserve coverage should increase to provide stronger buffers against immediate short-term risks. Structural competitiveness and investment efficiency improvements will be essential to ensure that the planned large investment programs translate into growth and export gains as well as increased private inflows into the region.
Program (PAG), 2016–21 encourages the use of innovative financing such as Public-Private Partnerships (PPPs) to ensure project implementation.
4. In addition to the infrastructure gap, however, Benin’s infrastructure is also perceived as being of relatively low quality, and investment efficiency appears low ( Figure 4 ) . The most recent World Economic Forum’s (WEF) Global Competitiveness Indicators ranks Benin behind the SSA average and SSA regional groups. The quality of electricity supply, railroads and roads scored below SSAbenchmark countries’ average as well
point growth gains if export diversification was raised to levels observed in Asian or SSAbenchmark countries. Output growth volatility could be significantly reduced as well.
9. Policies to promote structural transformation and diversification should focus on addressing weaknesses that hinder entry into new lines of economic activity ( IMF, 2014a ). Weaknesses abound in the WAEMU in terms of the provision of infrastructure, the accumulation of human capital, the provision of finance, the establishment of trade networks and functioning of factor markets, the
This Selected Issues paper analyzes the growth, structural transformation, and export diversification in Benin. Although Benin has delivered high economic growth over recent years, it faces critical challenges regarding export diversification and domestic production. Benin’s competitiveness is impaired by structural bottlenecks. Low and stagnant productivity in the agriculture sector is perhaps a primary cause of the limited poverty reduction in rural areas. Policies to promote structural transformation and diversification should focus on addressing weaknesses that hinder entry into new lines of economic activity. Further progress on strengthening the business climate, addressing electricity shortages, and increasing human capital could provide significant benefits.
diversification was raised to levels observed in Asian or SSAbenchmark countries. Output growth volatility could be significantly reduced as well.
Figure 5. Gains from Structural Transformation and Diversification
Sources: IMF (2014a) and staff calculations
8. Policies to promote structural transformation and diversification should focus on addressing weaknesses that hinder entry into new lines of economic activity ( IMF, 2014a ) . Weaknesses abound in Mali in terms of the provision of infrastructure, the accumulation of human capital, the provision of finance