scholarly journals External debt sustainability in West African countries

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Douglason Omotor
Keyword(s):  
Sovereign Debt ◽  
External Debt ◽  
West African ◽  
African Countries ◽  
Debt Sustainability ◽  
Content Type ◽  
Current State ◽  
External Borrowing ◽  
Solvency Ratio ◽  
Sustainability Framework

Purpose This paper aims to apply the debt sustainability framework using various ratios to review the current state of sovereign debt of Economic Community of West African States (ECOWAS) member countries. Design/methodology/approach Debt sustainability framework using various ratios (which include the present value approach, Country Policy and Institutional Assessment debt policy assessment ranking and solvency ratio of external debt) for the period 2010 and 2017 were used for the analysis to determine external debt sustainability and solvency of ECOWAS members. Findings The findings indicate that most ECOWAS countries are already turning at the unsustainable debt path and may renege in their debt obligations, thus creating a vicious cycle of external borrowing that could lead to capital flight. Originality/value This paper offers the empirical evidence to identify which of the ECOWAS countries are already at the threshold of external debt stress, and in the likelihood to renege on their debt obligations.

Jihadist expansion into West Africa will take time

2021 ◽  
Keyword(s):  
West Africa ◽  
Ivory Coast ◽  
West African ◽  
African Countries ◽  
Content Type ◽  
Cross Border ◽  
Intelligence Sharing ◽  
Joint Operations ◽  
Hit And Run ◽  
Security Assistance

Significance While the overall number of incidents is fewer than a dozen since the rise of the region's jihadist insurgencies in the early 2010s, the trend lends credence to growing warnings about the jihadist threat to coastal West African countries. Concern has focused on Ivory Coast and Benin, but there is also nervousness about Ghana, Togo and even Senegal. Impacts Western governments will boost security assistance to coastal states. Intelligence sharing and joint operations will not forestall cross-border hit-and-run attacks. Most regional states will resort to security-focused responses whose abuses drive jihadist recruitment.

Illicit Financial Flows, Sovereign Debt, and Human Rights

2018 ◽  
pp. 317-336
Author(s):  
Cephas Lumina ◽  
Mulesa Lumina
Keyword(s):  
Sustainable Development ◽  
Human Rights ◽  
Sovereign Debt ◽  
Poverty Reduction ◽  
External Debt ◽  
Legal Framework ◽  
Financial Flows ◽  
Illicit Financial Flows ◽  
External Borrowing ◽  
The Impact

In recent years, there has been increasing attention to the problem of illicit financial outflows—broadly defined as funds that are illegally earned, transferred and utilized outside the country of origin in contravention of that country’s relevant legal framework. Illicit financial outflows divert resources away from activities that are essential for poverty reduction, sustainable development and the realisation of all human rights. They also contribute to the accumulation of external debt as governments that lack domestic resources as a result of these flows may resort to costly external borrowing. This chapter examines the nature of illicit financial flows, the factors that facilitate them and the measures taken by states, individually and collectively, to tackle them. It also discusses the impact of these flows on the realisation of human rights in the countries of origin and proposes concrete measures by which to curb illicit financial flows.

Review of the Debt Sustainability Framework for Low Income Countries

Policy Papers ◽  
2017 ◽  
Vol 17 ◽  
Author(s):  
Keyword(s):  
Low Income ◽  
Stress Test ◽  
External Debt ◽  
Low Income Countries ◽  
Debt Sustainability ◽  
Debt Burden ◽  
The Core ◽  
Sustainability Framework ◽  
Test Scenarios ◽  
Capacity Estimates

The Debt Sustainability Framework for Low-income Countries (LIC DSF) has been the cornerstone of assessments of risks to debt sustainability in LICs. The framework classifies countries based on their assessed debt-carrying capacity, estimates threshold levels for selected debt burden indicators, evaluates baseline projections and stress test scenarios relative to these thresholds, and then combines indicative rules and staff judgment to assign risk ratings of external debt distress. The framework has demonstrated its operational value since the last review was conducted in 2012, but there are areas where new features can be introduced to enhance its performance in assessing risks. Against the backdrop of the evolving nature of risks facing LICs, both staff analysis and stakeholder feedback suggest gaps in the framework to be addressed. Complexity and lack of transparency have also been highlighted as causes for concern. This paper proposes a set of reforms to enhance the value of the LIC DSF for all users. In developing these reforms, staff has been guided by two over-arching principles: a) the core architecture of the DSF—model-based results complemented by judgment—remains appropriate; and b) reforms should ensure that the DSF maintains an appropriate balance by providing countries with early warnings of potential debt distress without unnecessarily constraining their borrowing for development.

Staff Guidance Note on the Application of the Joint Bank-Fund Debt Sustainability Framework for Low-Income Countries

Policy Papers ◽  
2013 ◽  
Vol 2013 (41) ◽  
Author(s):  
Keyword(s):  
International Development ◽  
World Bank ◽  
Low Income ◽  
External Debt ◽  
Low Income Countries ◽  
Debt Sustainability ◽  
Guidance Note ◽  
Bank Staff ◽  
Development Objectives ◽  
Sustainability Framework

Low-income countries (LICs) face significant challenges in meeting their development objectives while at the same time ensuring that their external debt remains sustainable. In April 2005, the Executive Boards of the International Monetary Fund (IMF) and the International Development Association (IDA) endorsed the Debt Sustainability Framework (DSF), a tool developed jointly by IMF and World Bank staff to conduct public and external debt sustainability analysis in low-income countries. The DSF aims to help guide the borrowing decisions of LICs, provide guidance for creditors’ lending and grant allocation decisions, and improve World Bank and IMF assessments and policy advice.

Revisiting the Debt Sustainability Framework for Low-Income Countries

Policy Papers ◽  
2012 ◽  
Vol 2012 (98) ◽  
Author(s):  
Keyword(s):  
World Bank ◽  
Low Income ◽  
External Debt ◽  
Low Income Countries ◽  
Bank Debt ◽  
Debt Sustainability ◽  
Analytical Work ◽  
Grant Allocation ◽  
Sustainability Framework ◽  
Allocation Decisions

Introduced in 2005, the joint IMF-World Bank Debt Sustainability Framework (DSF) is a standardized framework for conducting public and external debt sustainability analysis (DSA) in low-income countries (LICs). It aims to help guide the borrowing decisions of LICs, provide guidance for creditors‘ lending and grant allocation decisions, and improve World Bank and IMF assessments and policy advice. The framework was previously reviewed in 2006 and 2009. This paper provides a comprehensive review of the framework to assess whether it remains adequate in light of changing circumstances in LICs. It reviews the DSF‘s performance to date, presents the results of recent analytical work by IMF and World Banks staffs, and discusses a number of areas in which the framework could be improved.

Beyond prohibition: responses to illicit drugs in West Africa in an evolving policy context

2020 ◽  
Vol 20 (2) ◽  
pp. 123-133
Author(s):  
Ediomo-Ubong Nelson ◽  
Isidore Obot
Keyword(s):  
Drug Use ◽  
West Africa ◽  
Drug Policy ◽  
Illicit Drugs ◽  
West African ◽  
Policy Environment ◽  
African Countries ◽  
Content Type ◽  
Policy Interpretation ◽  
United Nations General

Purpose The purpose of this paper is to discuss priorities for effective responses to illicit drugs in West Africa in a changing international policy environment. Design/methodology/approach The paper analyzes published research, technical papers and reports on drug use and policy responses in West Africa and opines on priorities for drug policy in the region within the post-United Nations General Assembly Special Session (UNGASS) 2016 policy environment. Findings Drug use and related harms continue to increase in West African countries despite efforts to reduce drug trafficking and use through legal prohibition. The UNGASS 2016 outcome document enables flexibility in policy interpretation and implementation, which provides an opportunity for governments to prioritize national needs in drug policy. West African countries should prioritize and support research and data collection, prevention, treatment and harm reduction and sustainable livelihoods. Originality/value The paper emphasizes the need for West African countries to seize the opportunity created by the ineffectiveness and weakening of the prohibition regime as well as new treaty flexibility following UNGASS 2016 to reform drug policies to prioritize regional and national needs.

A full public debt restructuring overhaul is unlikely

2021 ◽  
Keyword(s):  
Public Debt ◽  
Sovereign Debt ◽  
External Debt ◽  
Poor People ◽  
Debt Restructuring ◽  
Content Type ◽  
Monetary Expansion ◽  
Lost Decade ◽  
Legal Difficulties ◽  
Complete Overhaul

Significance The stock of EM debt has multiplied since 2000, accompanied by legal difficulties for borrowers falling into distress. Some economists are calling for a complete overhaul of the system to handle sovereign debt crises, including the creation of an independent international organisation to manage it. Impacts By eroding tax bases and raising domestic and external debt repayment costs, COVID-19 will have a lasting impact on EM output. Together with collapsing exports, the fiscal blow from the crisis could trigger a wave of distressed governments to default on their debts. EM’s limited recourse to fiscal and monetary expansion could result in a lost decade for hundreds of millions of already poor people.

Impact of economic growth on carbon emissions in selected West African countries, 1980–2019

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Richard Osadume ◽  
Edih O. University
Keyword(s):  
Economic Growth ◽  
Carbon Emissions ◽  
Secondary Data ◽  
West African ◽  
World Bank Group ◽  
Economic Activities ◽  
African Region ◽  
African Countries ◽  
Content Type ◽  
The Impact

PurposeThis study investigated the impact of economic growth on carbon emissions on selected West African countries between 1980 and 2019. Simon-Steinmann's economic growth model provides the relevant theoretical foundation. The main objective of this study was to ascertain whether economic growth will impact carbon emissions.Design/methodology/approachThe study selected six-sample countries in West Africa and used secondary data obtained through the World Bank Group online database covering the period 1980–2019, employing panel econometric methods of statistical analysis.FindingsThe outcome indicates that the independent variable showed a positively significant impact on the dependent variable for the pooled samples in the short-run, with significant cointegration.Research limitations/implicationsThe study concluded that economic growth significantly impacts the emissions of carbon, and a 1% rise in economic growth will result to 3.11121% unit rise in carbon emissions.Practical implicationsPolicy implementation should encourage the use of energy efficient facilities by firms and government and the establishment of carbon trading hubs.Social implicationsFailure by governments to heed the recommendations of this research will result to serious climate change issues on economic activities with attendant consequences on human health within the region and globally.Originality/valueThis is one of the comprehensive works on subject covering the West African region within the continent.

Persistence of bribery in West African countries

2020 ◽  
Vol 27 (2) ◽  
pp. 651-662
Author(s):  
Sani Abubakar Saddiq ◽  
Abu Sufian Abu Bakar
Keyword(s):  
Design Methodology ◽  
West African ◽  
Risk Matrix ◽  
Government Officials ◽  
African Countries ◽  
Data Set ◽  
Content Type ◽  
The Matrix ◽  
Policy Measures ◽  
Methods Of Moments

Purpose The purpose of this paper is to empirically test persistence of bribery transactions in West African countries in spite of combative policy measures put in place by various governments in the sub-continent. Design/methodology/approach Data for this paper is obtained from the data set of Trace International’s Bribery Risk Matrix covering 2016 to 2018. The matrix is used to allow firms to determine risks associated with contact with government officials in a particular country. The data set is used to test this paper’s hypotheses. The generalize methods of moments (GMM) was used to estimate panel data of 16 West African Countries in STATA 14.0. Findings The result of the estimations reveals that in spite of combative policy measures put in place and millions of dollars spent, bribery is on the increase in West African countries. Originality/value Prior studies tend to focus on prevalence and pervasiveness of bribery transactions across the globe. This paper is one of the few that focuses on persistence of bribery particularly in West African countries.

Do sovereign credit rating announcements influence excess bond and equity returns in Africa?

2018 ◽  
Vol 13 (6) ◽  
pp. 1522-1537 ◽  
Author(s):  
Misheck Mutize ◽  
Sean Joss Gossel
Keyword(s):  
Financial Markets ◽  
Information Exchange ◽  
Sovereign Debt ◽  
Credit Rating ◽  
Relevant Information ◽  
African Countries ◽  
Content Type ◽  
Sovereign Credit ◽  
Study Techniques ◽  
Sovereign Credit Rating

Purpose The purpose of this paper is to examine whether new sovereign credit rating (SCR) changes are valuable, and relevant information is provided to bond and equity markets in 30 African countries that received an SCR during the period 1994–2014. Design/methodology/approach This study applies a combination of GARCH models and event study techniques. Findings This study shows that the financial markets do not significantly react to SCR announcements, possibly because these African markets are already perceived to be risky. Research limitations/implications At last, a significant portion of Africa’s sovereign debt is held by foreign investors (Arslanalp and Tsuda, 2014) who commonly preclude asset managers from investing in low SCR grades. Thus, an unfavorable SCR announcement could lead to a withdrawal of these funds, which could significantly alter both fiscal and monetary policies in the economy. Practical implications SCRs is immaterial to investors holding African securities. Social implications Although financial markets are weakly responsive to SCR announcements, they appear to be informationally important in the operation of stocks and bond markets in Africa. Therefore, governments should appreciate the long-term information exchange between investors and borrowers, and the consequential nature of credit ratings in Africa’s nascent financial markets in order to proactively manage the risks of negative ratings. Originality/value Studies on credit rating effects on Africa markets are rare.

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