Transforming finance in the Middle East and North Africa

By Rabah Arezki, Chief Economist for Middle East and North Africa Region at the World Bank and Lemma W. Senbet, The William E. Mayer Chair Professor of Finance, Robert H. Smith School of Business, University of Maryland, and Immediate Past Executive Director/CEO, African Economic Research Consortium

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To overcome current challenges and seize the opportunity to leapfrog, the Middle East and North Africa (MENA) region needs to simultaneously embrace the technological tide transforming the global economy and clean energy development. This transformation calls for a dual transition: (a) decarbonisation of the economy—moving away from the use of fossil fuel as the main source of energy toward renewable energies; and (b) digitalisation— the digital transformation of traditional activities and the advent of new digital activities. To achieve the transition, MENA needs hundreds of billions of dollars of investment in quality projects, including in renewable energy and telecom sectors. MENA should aggressively join the global momentum for the use of clean, renewable energy (e.g., wind, solar, geothermal) to combat climate change. Likewise, it should aggressively develop the digital infrastructure that is also essential for the development of a digitised financial economy.

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Ongoing debt restructuring must involve Africa’s new creditors

By Arthur Minsat, OECD Development Centre and Yeo Dossina, African Union Commission[i]


This blog is part of a series on tackling COVID-19 in developing countries. Visit the OECD dedicated page to access the OECD’s data, analysis and recommendations on the health, economic, financial and societal impacts of COVID-19 worldwide. This blog is also a part of a thread looking more specifically at the impacts of the COVID-19 crisis in terms of capital flows and debt in developing countries.


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The global recession caused by the COVID-19 pandemic calls for a cancellation or restructuring of African countries’ debt. The crisis has triggered a double fiscal shock of soaring government expenditure and slumping revenues. Restoring African borrowing capacity is essential to fighting a loss of fiscal space.

Prior to the shock, Africa had already shown signs of vulnerability. Although the African continent boasted the world’s second highest economic growth rate at 4.6% on average between 2000 and 2018, it had started to slow down from a peak of 6.8% in 2012 to 3.2% in 2019. In 2020, Africa’s growth is likely to fall between -2.1% and -4.9%, significantly reducing the fiscal space of all countries. Overall, financing for development has dropped since 2010 in per capita terms. For both domestic revenues and external financial inflows, the amount of financing per capita has decreased by 18% and 5% respectively throughout 2010-2018. A less favourable global economy and persistently high demographic growth in most African countries have driven this downward trend.

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COVID-19: A threat to food security in Africa

 By Paul Akiwumi, Director, UNCTAD Division for Africa, Least Developed Countries and Special Programmes


This blog is part of a series on tackling COVID-19 in developing countries. Visit the OECD dedicated page to access the OECD’s data, analysis and recommendations on the health, economic, financial and societal impacts of COVID-19 worldwide.


Africa-covid-19The International Monetary Fund has projected a deep coronavirus-induced global recession, which threatens a nearly 4% drop in world GDP and could drag the GDP of African economies into a fall of about 1.4%, with smaller economies facing a contraction of up to 7.8%. This decline is mainly a result of export adjustments affecting primary commodity exporters and associated tax revenue losses. This in turn, reduces governments’ capacity to extend the public services needed to respond effectively to the crisis. Overall, UNCTAD estimates a regional average of about 5% in public revenue losses in Africa. Total merchandise exports are expected to contract by about 17% in 2020. These losses will have repercussions on Africa’s progress towards the Sustainable Development Goals and Africa’s Agenda 2063. With at least 60% of the African population dependent on agriculture for their livelihoods and access to food, any trade-related distortions to the sector can threaten the food security of the continent’s poor. In addition to the impact of extreme climate shocks on agricultural productivity, there is a strong positive correlation between economic recession and food insecurity in Africa. Despite the continent’s huge resource endowments (including a wide availability of arable land, and a young, growing labour force, among other factors), the continent’s agricultural production alone, hampered by distribution, access, and affordability challenges, is insufficient to meet its food security needs. Continue reading

How COVID-19 is affecting Egypt’s migrants and refugees

By the Centre for Migration and Refugee Studies (CMRS), the American University in Cairo (AUC)


This blog is part of a series on tackling COVID-19 in developing countries. Visit the OECD dedicated page to access the OECD’s data, analysis and recommendations on the health, economic, financial and societal impacts of COVID-19 worldwide.
This blog is also a part of a thread looking more specifically at the impacts of and responses to the COVID-19 crisis on migration and developing countries.


Egypt-covid-19Egypt has one of the highest numbers of cases of COVID-19 in the African continent and as of August 5th, reported 94,875 cases, 4,930 deaths, and 47,182 recoveries. To curb the spread of the virus, borders and entry and exit pathways quickly closed in March, as international airports shut down to most air traffic, as did the land border crossing with Sudan. Since then Cairo International airport has re-opened as of July 1st. Egypt is a country of 100 million people with around 259,900 refugees and asylum-seekers officially registered with the United Nations High Commissioner for Refugees (UNHCR). It also hosts an unspecified large number of unregistered asylum-seekers and refugees. Many of these refugees see Egypt as a transit country until they have the means to make an onward journey or to be resettled in the EU, US, Australia, or Canada. However, many of them end up staying in Egypt for years, contributing to the local economy. One impact of COVID-19 is that many of those waiting to be resettled, have now been left in limbo in their country of asylum. While the International Organisation for Migration (IOM) and UNHCR recently announced the re-opening of international resettlement, many travel restrictions remain in place.

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Moratoire sur la dette des pays africains : tout le monde doit participer !

Par Najat Vallaud-Belkacem, directrice France de l’ONG ONE


Ce blog fait partie d’une série sur la lutte contre le COVID-19 dans les pays en voie de développement. Visitez la page dédiée de l’OCDE pour accéder aux données, analyses et recommandations de l’OCDE sur les impacts sanitaires, économiques, financiers et sociétaux de COVID-19 dans le monde.


NajatAlors que le monde est confronté à une pandémie mondiale d’une ampleur sans précédent depuis des décennies, les pays africains ont un besoin urgent de ressources financières pour répondre à la crise COVID-19 et à ses retombées économiques, sanitaires et sociales. La Banque mondiale estime que le continent connaîtra sa première récession depuis 25 ans. Les experts de la communauté internationale sont donc confrontés à un problème majeur : comment libérer de manière rapide et à grande échelle les financements nécessaires à la lutte contre la pandémie dans les pays les plus pauvres du monde ?

Il apparait aujourd’hui qu’une des meilleures solutions pour libérer rapidement des ressources financières supplémentaires est d’alléger la dette. En effet, le poids de la dette constitue un problème récurrent auquel doivent faire face de nombreux pays africains. A titre d’exemple, la Gambie alloue neuf fois plus de ressources au remboursement de sa dette extérieure qu’à ses dépenses de santé publique. La place qu’occupe le remboursement de la dette au sein des budgets nationaux des pays pauvres est colossale : en 2020, ce sont 22 milliards de dollars du service de la dette qui sont détenus par d’autres gouvernements, 12 milliards de dollars par des bailleurs multilatéraux, et près de 13 milliards de dollars par créanciers privés (investisseurs et banques commerciales). C’est donc un poids financier qui ne pourra être diminué que si tous les créanciers travaillent ensemble à un allègement généralisé des dettes publiques et privées. Continue reading

Impulsando la industrialización de África por medio del empuje del COVID-19

Por Toyin Abiodun, asesor de Industria y Comercio de Rwanda, Maudo Jallow, analista de Industria y Comercio de Ghana y Jonathan Said, jefe de Crecimiento Económico Inclusivo de África, Instituto Tony Blair


Este artículo es parte de una serie sobre cómo abordar COVID-19 en los países en desarrollo. Visite la página específica de la OCDE para acceder a los datos, análisis y recomendaciones de la OCDE sobre los impactos sanitarios, económicos, financieros y sociales del COVID-19 en todo el mundo.


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Imagen cortesía del Instituto Tony Blair

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África importa cada año productos manufacturados por un valor neto de 232.000 millones de dólares, mientras que exporta productos básicos por un valor neto de 174.000 millones de dólares. Aunque la economía de África creció en promedio un 5,5% anual en los últimos 15 años, la industria manufacturera ha seguido siendo un aspecto estático, que sigue representando sólo el 10% del PIB.

El impacto que COVID-19 está teniendo en las cadenas mundiales de suministro y en el comercio mundial, y la inmensa presión económica que está ejerciendo sobre África -no sólo en la disponibilidad de equipos médicos, sino también de alimentos y otros bienes- indica la importancia de la industrialización del continente. Si bien COVID-19 está creando una importante crisis económica y sanitaria, también presenta una oportunidad para “coger el toro por los cuernos” y acelerar la industrialización de África. Continue reading

Negotiating a royalty pricing agreement: lessons from Liberia

By Stephen E. Shay, Lecturer at Harvard Law School; Iain Steel, independent economics consultant; Gabrielle Beran, Governance and Program Manager, International Senior Lawyers Project-UK (ISLP-UK); Olumide Abimbola, Business Development Lead, CONNEX Support Unit.

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Mount Nimba, Liberia: an abandoned mining site and the highest point in West Africa

Countries often collect royalties on the sale of their natural resources, but how can they be sure that the price is right when a mining company sells iron ore to its own steel mills? This was the problem faced by Liberia with its largest iron ore mine – and a common problem around the world in mining and many other sectors.

Sales between “related parties”, where the companies share a common owner and are therefore not independent of each other, use a “transfer price[i]” that is supposed to reflect fair market value – the price two independent firms would have agreed transacting at arm’s length. In this article, we describe how governments can make use of pricing agreements with companies to determine transfer prices by reference to international benchmarks, and the importance of reviewing these agreements to ensure they remain fit for purpose over time. We also draw lessons for revenue authorities, host governments and donor partners from the recent renegotiation of a pricing agreement in Liberia. Continue reading

Middle East and North Africa: The challenge of a long-term strategy for oil exporting countries

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By Rahmat Poudineh, Senior Research Fellow and Director of Research, the Oxford Institute for Energy Studies


This blog is part of a series on tackling COVID-19 in developing countries. Visit the OECD dedicated page to access the OECD’s data, analysis and recommendations on the health, economic, financial and societal impacts of COVID-19 worldwide.


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Oil refinery plant in Qatar

There is no single successful strategy to shield oil-exporting countries of the Middle East and North Africa (MENA) from the long-term risks of an oil price crash, exposing them to serious long-term challenges.

Diversification for example, works only when it reduces risk by pooling uncorrelated income streams and sectors. If countries diversify only into sectors that rely on hydrocarbon infrastructure and where relationships (tangible and non-tangible) exist across fossil and non-fossil fuel businesses, they cannot build resilience. On the other hand, if they diversify into substantively different areas that have little in common with their current primary industry, which is the core of their comparative advantage, they run the risk of not being competitive. Moreover, the cost of reducing the long-term risks and increasing resilience of their core sector is to accept lower expected return on existing hydrocarbon assets, for instance, by investing in measures that align their hydrocarbon sector with low carbon scenarios. This lowers the overall return but reduces the risk of disruption in the long run. Continue reading

Fighting COVID-19 in Africa’s informal settlements

By Maimunah Mohd Sharif, Executive Director, United Nations Human Settlements Programme (UN‐Habitat)


This blog is part of a series on tackling COVID-19 in developing countries. Visit the OECD dedicated page to access the OECD’s data, analysis and recommendations on the health, economic, financial and societal impacts of COVID-19 worldwide.


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Kibera informal settlement in Nairobi, Kenya. Photo: Boris Golovnev/Shutterstock

The COVID-19 pandemic has cost hundreds of thousands of lives in the world’s richest cities but poses an even greater threat to cities in the developing world. There are now more than 150,000 confirmed cases of coronavirus across Africa, in all 54 countries, with South Africa and Egypt the worst affected.

One of the most pressing concerns for Africa is that over half the population (excluding in North Africa) live in overcrowded informal settlements. In these areas where several people have to share one badly ventilated room, diseases such as COVID-19 spread fast and it is impossible to practice physical distancing whether in homes or outside. Continue reading

COVID-19, révélateur de la valeur de la vie humaine pour la société ?

Par Joseph Brunet-Jailly, Économiste, Paris School of International Affairs, SciencesPo Paris


Ce blog fait partie d’une série sur la lutte contre le COVID-19 dans les pays en voie de développement. Visitez la page dédiée de l’OCDE pour accéder aux données, analyses et recommandations de l’OCDE sur les impacts sanitaires, économiques, financiers et sociétaux de COVID-19 dans le monde.


COVID-19-sahelLa pandémie que nous vivons marque l’apparition inopinée d’une valeur de la vie humaine dans les préoccupations de l’humanité.

Certes, nous étions habitués aux proclamations solennelles selon lesquelles la valeur de la vie humaine serait absolue. Mais de là à considérer que la vie humaine devrait être l’aune à laquelle tout progrès se mesurerait, il y avait un grand pas qu’on ne voulait pas franchir. Il était tellement plus important de s’enrichir en biens matériels que la vie humaine elle-même y a été asservie : esclavage, servage, misère ouvrière, guerre, racisme, phobie des migrants, etc., autant de termes pour dire des vies humaines méprisées. Continue reading