Ethiopia’s vaunted economic success may falter

2018 ◽  
Keyword(s):  
Foreign Currency ◽  
Policy Support ◽  
Middle Income ◽  
Content Type ◽  
Public Investments ◽  
Income Status ◽  
Rapid Economic Growth ◽  
Official Policy ◽  
Slow Progress ◽  
Economic Outlook

Subject Ethiopia's economic outlook Significance The IMF in January raised its assessment of Ethiopia’s risk of external debt distress from ‘moderate’ to ‘high’ after exports failed to take off as anticipated, and foreign currency reserves fell further below prudential levels. This could tarnish the image of the country’s economic miracle, symbolised by its sustained rapid economic growth and ability to attract comparatively high levels of foreign direct investment (FDI) into non-resource sectors. Operationally, the downgrade reduces the scope for further commercial borrowing and could dampen momentum by curtailing public investments over the medium term without official policy support. Impacts Ethiopia's scheduled WTO accession in November could be derailed by slow progress in liberalising the economy. Ethiopia’s hitherto resilient sovereign ratings may come under pressure in the wake of the debt reclassification. With per capita GDP at 707 dollars and growth slowing, the country may struggle to reach lower middle-income status by 2025.

Long-term challenges cloud Ethiopia’s economic reforms

2019 ◽  
Keyword(s):  
Foreign Currency ◽  
Economic Reforms ◽  
Sharp Drop ◽  
Content Type ◽  
Economic Output ◽  
Gender Parity ◽  
Public Investments ◽  
Macroeconomic Imbalances ◽  
Gulf States

Subject Outlook for Ethiopia's economic reforms. Significance Prime Minister Abiy Ahmed has taken advantage of political goodwill following his election to consolidate difficult policies correcting macroeconomic imbalances. Inflation is expected to continue falling despite a late-2017 currency devaluation, as will debt and the fiscal deficit. However, this will be balanced by slower GDP growth, reflecting a sharp drop-off in public investments and a still-emerging private sector. Impacts Electricity exports could generate 1 billion dollars by 2022, surpassing coffee as the largest foreign currency earner. The push for gender parity in politics and beyond could raise economic output by 24% in the long term. More aid could come from Gulf states if Ethiopia resolves its conflict with Egypt over the Grand Ethiopian Renaissance Dam.

Slow reform may hurt West African monetary bloc's rise

2017 ◽  
Keyword(s):  
Regional Integration ◽  
Business Environment ◽  
West African ◽  
Sub Saharan Africa ◽  
Economic And Monetary Union ◽  
The West ◽  
Middle Income ◽  
Content Type ◽  
Income Status ◽  
Sub Saharan

Subject Prospects for the West African Economic and Monetary Union (WAEMU) Significance Economic growth in WAEMU reached 6.1% in 2016, outperforming peer regional blocs including its closest rival, the East Africa Community (EAC), which (excluding South Sudan) grew by 5.8%. However, business environment reforms lag those of the rest of sub-Saharan Africa, which could dampen longer-term growth. Impacts Despite recent progress, growth rates need to increase above 7% for at least 20 years for the zone to reach middle-income status. The structural depreciation of Nigeria's naira could erode regional integration as importing within the zone becomes more expensive. Security fears in Ivory Coast could shift investors' focus to Senegal -- despite Yamoussoukro's recent eurobond success.

Rwandan agriculture strategy unlikely to be replicated

2017 ◽  
Keyword(s):  
Agricultural Sector ◽  
National Level ◽  
National Development ◽  
Severe Drought ◽  
Vision 2020 ◽  
East African ◽  
Middle Income ◽  
Content Type ◽  
East African Community ◽  
Income Status

Subject Rwandan agricultural interventions. Significance On May 15, the IMF completed its latest Article IV consultation and review with Kigali, predicting a return to growth of 6.2% per annum. According to the Fund, the main driver of this rebound is the agricultural sector, which is rapidly recovering from a severe drought in 2015-16. President Paul Kagame’s ambitious national development plan, Vision 2020, aims for the country to achieve middle income status by 2025, with transformation of the agricultural sector crucial to this. Impacts The government’s drought response will boost Kagame’s popularity among poorer rural households. However, if Kagame steps down after his next term in office, this could create disorder across many sectors. National-level disaster responses will prove more effective than their East African Community (EAC) equivalent.

A Discursive Trap?: The Power and Danger of the Middle-income Trap Discourse

2018 ◽  
Vol 2018 ◽  
Author(s):  
Nicole Curato
Keyword(s):  
Discourse Analysis ◽  
Middle Income Country ◽  
Income Country ◽  
Alternative Possibilities ◽  
Middle Income ◽  
Rhetorical Devices ◽  
Income Status ◽  
Rapid Economic Growth ◽  
Key Policy ◽  
Middle Income Trap

The “middle-income trap” has gained currency in the past decade among economists and development practitioners. The term draws attention to countries that have experienced rapid economic growth but failed to break through the high-income status. This article critically examines the underlying discursive logics behind the vocabulary of the middle-income country trap. The term may seem technical and benign, but its ontology, assumptions, rhetorical devices, and conception of economic actors privilege a sequential view of economic development bereft of normative considerations and ethical standpoints. This article argues that the middle-income country trap narrative posits a worldview that promotes a growth agenda using the experience of the industrialized North as a benchmark. The term “trap,” particularly, posits an imperative for growth where being “stuck” in the middle-income status is pathologized and demands for economic intervention is legitimized. This discourse is formed by a range of rhetorical devices that evoke urgent responses to the impending threat of lagging behind. Motives for using this vocabulary may not be malicious—well-meaning, even—but the taken-for-granted status of these knowledge claims warrants a critical engagement. Discourses have consequences in economic planning and policy formulations for they provide the vocabulary for desirable economic trajectories. To analyze the middle-income trap discourse, therefore, is to stimulate a systematic process of critique that can potentially open spaces for alternative possibilities for the current economic order. These observations are based on a qualitative discourse analysis of key policy documents and punditry on the puzzles and perils of countries trapped in the middle-income status. Using Dryzek’s (1997) approach to discourse analysis, this article seeks to interrogate and de-naturalize dominant economic agendas and offer a critical sociological language that can lay bare the underpinnings of a technocratic discourse. Overall, this article argues for a reflective take on technical vocabularies to break free from emerging discursive traps.

HealthKeepers Network: financial sustainability in emerging market sociopreneurship

2020 ◽  
Vol 10 (4) ◽  
pp. 1-21
Author(s):  
Mathew Tsamenyi ◽  
Nana Yaa A. Gyamfi
Keyword(s):  
Emerging Market ◽  
Business Management ◽  
Social Enterprises ◽  
Financial Sustainability ◽  
Middle Income ◽  
Content Type ◽  
For Profit ◽  
Academic Level ◽  
Income Status ◽  
Trade Offs

Learning outcomes Students should be able to appreciate the exigencies of managing social enterprises in a largely profit-oriented economic domain; understand the interplay of choice and trade-offs in business management and be equipped to make optimal choices; and appraise new, creative and profit-making approaches for sustaining social enterprise. Case overview/synopsis Daniel Mensah and his team were to deliberate on options available for ensuring financial sustainability of HealthKeepers Network (HKN), a not-for-profit organization focused on community health and grassroots capacity development. As the economy of Ghana moved towards middle-income status, funding from global organizations had begun to decline. To ensure HKN’s continuity, Mensah needed to re-engineer HKN’s finances and consider options available for ensuring cash inflows to support the organization’s operations. Each of the available options involved specific setbacks or challenges for HKN to overcome to achieve financial sustainability. Mensah and his team were to engage in a brainstorming session analyse the available options and map the way forward for HKN. Complexity academic level This case is suitable for undergraduate and graduate-level programmes in business management. Supplementary materials Teaching Notes are available for educators only. Subject code CSS 3: Entrepreneurship.

Cambodia will see development challenges in 2016

2016 ◽  
Keyword(s):  
Low Income ◽  
Political Institutions ◽  
Value Chain ◽  
Economic Value ◽  
Middle Income ◽  
Content Type ◽  
Industrial Base ◽  
Income Status ◽  
Social Tensions

Subject Cambodia economic challenges and reform outlook. Significance Cambodia will graduate to lower-middle- from low-income status in 2016. However, the country faces challenges moving further up the economic value chain, including social tensions, corruption and weak political institutions. Funding needed to remove industry bottlenecks and create a more diversified manufacturing base is being diverted into populist programmes. Impacts Cambodia will struggle in the long term to avoid the 'middle-income' trap unless it broadens its industrial base. Proposed investment reforms appear promising, but need better enforcement measures. The garment sector faces further strikes, potentially hitting competitiveness.

The Great Exodus

2018 ◽  
Vol 10 (1) ◽  
pp. 3-15 ◽  
Author(s):  
Fang Cai
Keyword(s):  
Economic Growth ◽  
Labor Productivity ◽  
Allocative Efficiency ◽  
Chinese Economy ◽  
Growth Effect ◽  
Middle Income ◽  
Content Type ◽  
Labor Reallocation ◽  
Surplus Labor ◽  
Income Status

Purpose The purpose of this paper is to review the process of rural labor reallocation and unfolds its growth effect through sufficiently supplying human resources, preventing diminishing return to capital, and increasing labor productivity. Design/methodology/approach The author surveys literature and statistics related to the subject to comprehensively picture the 40-year course of the shift and reallocation of agricultural surplus labor. Findings In the past 40 years, reforms in relevant areas have eliminated institutional barriers deterring labor mobility and allowed agricultural laborers to exit from low-productivity farming employment, migrate beyond rural-urban boundary and across regions, sectors, and ownerships, and enter higher productivity employment in non-agricultural sectors. As a result, resources allocative efficiency has been substantially improved, contributing a significant part to labor productivity growth and thus economic growth of the Chinese economy as a whole. Social implications To sustain this source of economic growth as far as China completes its transition from upper-middle income status to high-income status, deepening reforms is urgently needed. The author provides policy suggestions for further reform. Originality/value This paper enhances people’s understanding of the Chinese economic reform and its nature of efficiency and inclusion.

Kenyan infrastructure gains will mask slippage risks

2017 ◽  
Keyword(s):  
West African ◽  
Structural Reforms ◽  
Infrastructure Development ◽  
Robust Performance ◽  
Middle Income ◽  
Content Type ◽  
Macroeconomic Variables ◽  
Income Status ◽  
Government Financing ◽  
External Conditions

Subject Kenyan fiscal pressures. Significance Economic headwinds will culminate in slower GDP growth this year as drought, slowing credit and pre-election uncertainty weigh on activity. Growth is forecast to decelerate to 5.3%, from 6.0% in 2016, but could pick up pace again to 5.8% next year, as infrastructure development boosts productivity. Benign external conditions, along with policy prudence, has helped stabilise macroeconomic variables and consolidated the government's credibility. However, the elevated fiscal deficit remains a source of vulnerability. Impacts Despite robust performance, growth is still significantly below the 8% needed to lift Kenya to upper-middle income status by 2030. Interest in the planned Eurobond could surpass levels achieved by West African peers this year given better progress on structural reforms. While Kenya's first mobile bond or 'M-Akiba' proved successful, institutional lenders will remain the main source of government financing.

Downgrades highlight Chile's weak economic outlook

2017 ◽  
Keyword(s):  
Foreign Currency ◽  
Terms Of Trade ◽  
Fiscal Impact ◽  
Content Type ◽  
Rate Of Increase ◽  
Standard And Poor's ◽  
Trading Partners ◽  
Weak Growth ◽  
Economic Outlook

Significance On August 11, Fitch Ratings downgraded Chile’s long-term foreign currency rating to ‘A’ from ‘A+’, its level since 2011. This followed a downgrade by Standard and Poor’s to 'A+' from 'AA-' in mid-July. Both agencies cited weak growth, lower copper prices and their fiscal impact. Impacts Growth remains weak this year despite Chile’s improved terms of trade and higher growth in its trading partners. It is the rate of increase of government borrowing, rather than its level, that is a concern. Whatever its colour, the next government will have little room to increase spending without putting additional pressure on borrowing.

scholarly journals Vietnam's Development Success Story and the Unfinished SDG Agenda

2020 ◽  
Vol 20 (31) ◽  
Author(s):  
Anja Baum
Keyword(s):  
Economic Growth ◽  
Sustainable Development Goals ◽  
Success Story ◽  
Middle Income ◽  
The Sustainable Development ◽  
Income Status ◽  
Developmental Progress ◽  
Rapid Economic Growth ◽  
Development Goals ◽  
Electricity Infrastructure

Despite starting as one of the poorest countries in the mid-1980s, Vietnam has achieved rapid developmental progress, reaching lower middle-income status in 2010. In line with rapid economic growth, Vietnam has achieved impressive progress towards the Sustainable Development Goals (SDGs) during this time. This paper sheds light on some elements of Vietnam’s success story, highlighting crucial policies in education and electricity sectors. It undertakes a forward-looking costing exercise that focusses on five sectors – education, health, roads, water, and electricity infrastructure. Achieving the remaining SDGs in Vietnam will be a challenge, with total annual additional spending needs in the 5 subsectors estimated at 7 percent of GDP by 2030.

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