What will fuel Africa’s economic growth and development? Will urban centres be the spark? Will agricultural areas drive productivity? The answer is both.
As negotiations near conclusion on the Sustainable Development Goals (SDGs), countries are honing in on what it will take to implement them. There are currently 17 goals on the table, and by the time the UN summit to launch the goals takes place in September, the much-emphasised “transformative” nature of the goals could gain traction, as could the “revitalised global partnership” called for under Goal 17.
"Most of our problems are based on finances. Money is always an issue. I have to still provide for both my parents who are not working and make sure they are fed; I must pay their insurance policies because they no longer have the ability to pay them. I don’t earn enough money to afford all of that."
Joacquim is a subsistence farmer from Etatara in Mozambique. At 46 years old, he is his family’s sole breadwinner, responsible for supporting his wife and three orphaned grandchildren. He lives in a traditional house, which he is unable to use as collateral, and grows maize, sorghum, cassava and beans. They consume a lot of the produce themselves, and what is not consumed is sold. Joacquim earns US$300-500 per month depending on the season and his produce.
Access to financing can contribute to inclusive social and economic development. How might digital transactions help? Here’s how.
Women are consumers, business owners, farmers, employees and entrepreneurs. They are dependent on market systems and need access to finance to manage their livelihoods.
“To eradicate poverty we need to direct more development assistance and concessional loans to the poorest nations and mobilise much more private finances for development.” Official development assistance (ODA) reached an all-time high of $135.2 billion in 2014. Even so, not all developing countries rely on ODA to the same extent, and to some of them it may seem like a drop in the bucket compared to other international financial flows. However, for the least developed countries, such assistance represents over 70% of available external finance and more than one-third of their total public revenue and expenditure. This highlights the importance of the target set by the United Nations in 1970: for donors to allocate 0.7% of their gross national income as ODA.
Investment has been hit hard by the crisis, yet is vital for a sustainable recovery and future well-being. In 2008-14 private investment ran at some 25% below pre-crisis forecasts. From infrastructure and green energy to improving education and health care, all countries depend on investment in physical and human capital.
Meeting budgetary targets is hard enough in any country, but for developing countries struggling to lift their economies to a higher stage of development, it can seem a near impossible task. Nevertheless, governments and local authorities everywhere in the world have a duty to provide proper public and social services for their citizens, and infrastructure that will attract investors. Tax revenues are therefore vital for meeting public demands as well as development aspirations. As a general rule of thumb, a stable and predictable budgetary framework helps foster growth and, in the longer term, reduces dependence on foreign financing, be it public or private. Taxation is a bedrock of “good government” and a driving force for wider reforms. However, devising the right framework and approach to tax is not easy, from getting the tax levels right to ensuring skills are in place to devise and implement them.
Most people probably scratch their heads when it comes to filling out their tax returns. But whatever
challenges ordinary taxpayers face are nothing compared to what tax officials must confront, particularly when dealing with multinational firms.
Wealthy individuals have sustained their vast riches particularly through a few important economic sectors, including finance, pharmaceuticals and health care. Billionaires with activities in these sectors increased their collective net worth by 47% between 2013 and 2014. Companies from these sectors spend millions of dollars every year on lobbying to create a policy environment that enhances their interests. Other than the obvious unfairness and absence of moral integrity of this phenomenon, should ordinary people of the world–the other 99%–care? In a word, yes, because it is corroding what lies at the heart of functioning societies in which people’s rights are safeguarded and opportunities for all must be encouraged, rather than thwarted.
|“What is the city but the people?” asked Shakespeare in Coriolanus. All city planning focuses on people and the quality of life. The big cities in Brazil took shape from the 1950s, when the country’s population amounted to approximately 52 million inhabitants, only 36.2% of whom lived in cities. The development focus during the post-war period, led by the modernist canons that guided the conception of Brasília, spread across numerous cities where the automobile was the leading actor, and was supported by investments all over the country to build roads and other infrastructure, such as ports, railroads and electric power plants.|
Since democracy was restored in 1999, Nigeria has engaged in ambitious reforms towards greater market liberalisation and economic openness. By far the most populous country of the continent–with more than 170 million people Nigeria is home to 18% of Africa’s population–it now claims to be the largest
economy in Africa, with an estimated nominal GDP of US$510 billion. Its GDP growth has never been below 5% since 2003, and since 2009, it has become the preferred destination for foreign direct investment (FDI) in Africa, ahead of South Africa.
A warming planet and a flat world economy have propelled the issue of investment in clean energy to the top of the policy agenda. The question has become all the more crucial in view of the landmark global summit on climate change to be held in Paris in December 2015.
International trade is a key driver of development. But high trade costs prevent a large number of developing countries from fully exploiting the opportunities that the global market offers: increased development, stronger growth and more jobs.
The People’s Republic of China joined the OECD Development Centre on 1 July, in a move described as an important step in support of China’s transformation and transition to a new growth model.
The financial landscape has changed considerably in Africa since 2000. Private external flows in the form of investment and remittances now drive growth in external finance, according to the African Economic Outlook 2015. Foreign investments are expected to reach US$73.5 billion in 2015, underpinned by increasing greenfield investment from China, India and South Africa.
In my first climate change lecture, nearly two years ago, my key message was that meeting the challenge of climate change required us to achieve zero net greenhouse emissions globally by the end of this century.
At a time of great fragility and uncertainty, compounded by ever-growing appalling conflict and humanitarian tragedy, I am more concerned than ever before that our collective demands on the earth are outstripping what our planet can sustainably supply, and that if we are to avoid further unpleasant consequences we will need to make fundamental changes to how we approach growth and development. The Magna Carta–the 800th anniversary of whose signing in England we celebrate this year–established some of the central principles of human rights and individual liberty that hold today. Such a totemic document has proved extraordinarily valuable over the years and, in the same vein, I cannot help wondering if the Sustainable Development Goals and the climate agreement in 2015 could form the basis for a similarly long-standing contract for the earth and humanity's relationship to it. There is, after all, an immense amount at stake, and that is why the focus of this year's OECD Forum on these issues could not be more welcome.
In July we will meet in Addis Ababa to agree on a comprehensive financing framework for the future development agenda. In September leaders will converge in New York for the United Nations special summit for the adoption of a universal and transformative post-2015 development agenda. And in December, governments will gather in Paris for COP 21 on climate change, where they have pledged to forge a new path forward and adopt a meaningful, universal climate change agreement.
The world looks very different today. Emerging markets now account for more than half of global GDP and the number of people living in extreme poverty is down to one billion. This Millennium Development Goal has been reached, and that is good news. There is still a formidable challenge ahead, however, in the areas of poverty reduction, sustainability and inclusivity.
These remarks by Klaus Schmidt-Hebbel, then OECD chief economist, were made in October 2008, a month after Lehman Brothers fell. His assessment reflected the mood well. As the former chief economist warned, the crisis would last a long time indeed. OECD Secretary-General Angel Gurría acted promptly, and by January 2009 our organisation had launched a strategic response to the crisis. Governments also acted swiftly and in a concerted fashion to save the financial system (“the lifeblood of our economies”, as Mr Gurría described it), slash interest rates and apply fiscal stimuli.
How to improve water systems is one challenge; financing them is another. Public authorities in most countries play the main role in implementing and funding water infrastructure, but it is a model that is under increasing pressure, with government budgets stretched and banks still prudent about issuing credit.
Water holds huge potential for economic, social and individual betterment. There are challenges to confront, but also opportunities. With the right approach, water could be a harbinger of progress.
Poverty has been halved in less than 25 years worldwide. The enormous progress over the past few decades is mainly due to rapid economic growth in the South. China’s economy grew by 10% for decades and 600 million people were consequently brought out of poverty.
This will be “the mother of all years for summits on international development,” says Kevin Watkins*, Executive Director of the UK’s Overseas Development Institute (ODI). He’s not wrong.
Would you like to smell like Zinedine Zidane? A few years ago, a French perfume maker thought many of us would, and paid the football star to sell its manly mixture.
Not much good has come from the Ebola crisis, save this: It has raised awareness of the fact that we already have a weapon in our hands that could help fight such epidemics – our mobile phones.
Although South Africa has had an impressive track record among emerging economies, it has recently hit economic difficulties. We asked FEDUSA General Secretary, Dennis George, what have been the effects, and what steps the G20 and South African government must take to return to the path of healthy growth.
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