scholarly journals Capital flight and external borrowing in Sub-Saharan Africa

2020 ◽  
Author(s):  
Isaac Kwesi Ampah
Keyword(s):  
Sub Saharan Africa ◽  
Capital Flight ◽  
Sub Saharan ◽  
External Borrowing

Welfare implications of external debt and capital flight in Sub-Saharan Africa (Evidence using panel data modelling)

2021 ◽  
Vol 71 (2) ◽  
pp. 347-367
Author(s):  
Isaac Kwesi Ampah ◽  
Gábor Dávid Kiss
Keyword(s):  
External Debt ◽  
Estimation Method ◽  
Sub Saharan Africa ◽  
Capital Flight ◽  
Poor Countries ◽  
The People ◽  
General Welfare ◽  
Heavily Indebted Poor Countries ◽  
Sub Saharan ◽  
External Borrowing

AbstractThe countries in Sub-Saharan Africa (SSA) have experienced a positive growth rate of over five per cent per year, on average, since their transition from the Heavily Indebted Poor Countries Initiative in 1996 and the Multilateral Debt Relief Initiative in 2006. Despite this growth, poverty and inequality are still very high. Employing the Driscoll – Kraay standard panel estimation method and dataset from 1990 to 2015, this paper sets out to examine the implications of external debt and capital flight on the general welfare of the people. The estimation results reveal that both external debt and capital flight have a welfare inhibiting effect, suggesting that increases in external borrowing or capital flight may lead to a reduction in the welfare of the people in the sub-region. The study, therefore, recommends to policymakers and government in the sub-region the need to tackle the revolving nature of external borrowing and capital flight and take steps to halt all channels through which deservingly acquired capital leaves the sub-region.

Corruption, institutions and capital flight: evidence from Sub-Saharan Africa

2018 ◽  
Vol 45 (1) ◽  
pp. 59-76 ◽  
Author(s):  
Eric Osei-Assibey ◽  
Kingsley Osei Domfeh ◽  
Michael Danquah
Keyword(s):  
Portfolio Choice ◽  
Rule Of Law ◽  
Good Governance ◽  
Sub Saharan Africa ◽  
Capital Flight ◽  
Positive Sign ◽  
Institutional Variables ◽  
Content Type ◽  
Sub Saharan ◽  
The Relationship

Purpose The purpose of this paper is to investigate the effect of corruption and institutional governance indicators on capital flight in Sub-Saharan Africa. Design/methodology/approach Using a Portfolio Choice Framework, the study employs two different estimation techniques as Generalized Method of Moment and Fixed Effect Regression on panel data sets of 32 countries in Sub-Saharan Africa over the period 2000-2012. Findings The variable of interest, corruption, retains its expected positive sign and statistically significant across all the estimations. The relationship remains very strong even when other equally important institutional variables such as regime durability, rule of law and independence of the executive are taken into account. This suggests that a higher perception of corruption among public authorities as in bribery, kickbacks in public procurement, embezzlement of public funds, among others facilitates an increase in capital outflow from SSA. The findings further indicate that regime durability and rule of law are important institutional variables that also significantly influence capital flights in SSA. Practical implications The findings imply that institutional reforms should be encouraged if SSA is to win the war against corruption and by extension against capital flight. There should be a creation of democratic environment and good governance practices that foster stronger governance institutions, decline in corruption and better domestic investment climate to help reverse the high spate of capital flight in the region. Originality/value The main value of this paper is using the portfolio choice framework to analyze the relationship between capital flight and corruption in the Sub-Saharan African context.

Background to Migration

2018 ◽  
pp. 22-43
Keyword(s):  
Economic Growth ◽  
Human Development ◽  
Informal Sector ◽  
Single Unit ◽  
Sub Saharan Africa ◽  
Capital Flight ◽  
Wide Range ◽  
Independent States ◽  
Out Of Africa ◽  
Sub Saharan

Although the Sub-Saharan Africa (SSA) is not a monolithic entity but a collection of 48 independent states, the SSA's economy is analyzed as though it were a single unit in this chapter. This is because the SSA as a whole is confronted with a wide range of interlinked economic and socio-cultural problems that include high levels of unemployment and poor infrastructural challenges. Thus, this chapter evaluates issues of governance, institution, infrastructure, demography, capital flight, corruption, and the informal sector associated with economic growth and human development. These issues are deemed useful constructs to understand the “desperation” and “struggle” for emigration out of Africa by many Black Africans.

African indebtedness is critical but still reversible

2019 ◽  
Keyword(s):  
Large Scale ◽  
Debt Crisis ◽  
Sub Saharan Africa ◽  
Content Type ◽  
Lost Decade ◽  
Sub Saharan ◽  
The Republic ◽  
External Borrowing ◽  
Imminent Risk ◽  
The Imf

Subject African debt crisis? Significance Two decades after large-scale debt cancellation began in Sub-Saharan Africa, around one-third of the region’s countries have returned to, or are at imminent risk of, debt distress, according to the IMF. This has increased concerns of a repeat of a 1980s-style debt crisis, which ushered in the region’s fabled ‘lost decade’. Impacts The Republic of the Congo's prospects of restructuring its commercial debts have increased after its recent bailout agreement with the IMF. A speedy resolution to Mozambique’s debt crisis is unlikely after a recent domestic court ruling against its Eurobond-related debt. The recent fall in external borrowing reflects tightened market conditions more than reduced debt appetite, and may reverse in better times.

Sign in / Sign up

Export Citation Format

Share Document