By Steven M. Radil, U.S. Air Force Academy, Olivier Walther, University of Florida, Nicholas Dorward, University of Bristol, Matthew Pflaum, University of Florida and Marie Trémolières, Sahel and West Africa Club (SWAC), OECD
Political violence is moving away from cities in North and West Africa, even as urban populations continue to grow at an unprecedented pace in the region. More than half of the violent events observed in 2021 took place in rural areas, against 20% a decade ago. The emergence of Jihadist insurgencies in the Sahel and its southern peripheries explains this ruralisation of conflict that affects a growing number of civilians and border regions.
By Aathira Prasad, Director, Macroeconomics and Nasser Saidi, President, Nasser Saidi & Associates
“My dear, here we must run as fast as we can, just to stay in place. And if you wish to go anywhere you must run twice as fast as that.”
Lewis Carroll, Alice in Wonderland
The well-known “natural resource curse” comes from the observation that economic growth in nations with an abundance of natural resources tends to be lower and more volatile. A number of empirical regularities characterise these countries: (a) resource-abundant countries tend to underperform their resource-poor counterparts, with evidence of a negative relationship between real GDP growth per capita and resource exports; (b) resource-based economies’ exposure to adverse external shocks leads to macroeconomic instability and higher economic risks; (c) non-resource based activities get crowded out; and (d) institutions tend to be weak and anarchic.
By Yeo Dossina, Head of Economic Policy and Research, African Union Commission, Arthur Minsat, Head of the OECD Development Centre’s Unit for Africa, Europe and Middle EastandRodrigo Deiana, Consultant, OECD Development Centre
Africa’s value chains hold the key to unlocking its productivity, deepening its economic integration, and strengthening its resilience to shocks. Yet regional value chains accounted for just 2.7% of Africa’s total value chain participation in 2019, compared to 26.4% in Latin America and the Caribbean and 42.9% in developing Asia according to the latest edition of Africa’s Development Dynamics, a joint report by the African Union Commission and the OECD Development Centre.
By Dr Debapriya Bhattacharya, Distinguished Fellow at the Centre for Policy Dialogue (CPD) and Member, United Nations Committee for Development Policy & Ms Mamtajul Jannat, Programme Associate at CPD
The recent experience of a significant number of least developed countries (LDCs) graduating from that category has generated a certain level of interest in the development discourse. The Commonwealth Secretariat’s latest report is a welcome addition to that. It presents a cogent picture of the accomplishments and challenges that the 14 Commonwealth LDCs have experienced over the past decade. Five of these LDCs, Bangladesh, Kiribati, Solomon Islands, Tuvalu and Zambia, are poised to graduate in this decade.
The COVID-19 pandemic has shaken the world unlike any other crisis in recent history. During 2020, world gross domestic product (GDP) fell by 3.3%, the deepest global recession in 70 years, with an estimated loss of 255 million full-time employment jobs and an additional 97 million people falling into poverty. The effects were especially severe in developing and emerging industrial economies, which suffered an average estimated output loss of 7.7% compared to 3.9% for industrialised economies, according to the UNIDO Industrial Development Report 2022. Within countries, SMEs were more likely to shut down operations than large firms and suffered larger declines in sales and profits. Across workers, women experienced greater labour-market losses than men.
By Jonathan Papoulidis, Global Director of Fragility and Resilience, Food for the Hungry Inc., Fellow, Columbia World Projects
Today, fragile contexts are the centre of the global development crisis and poised to bear the worst of the pandemic and climate change. Even before COVID-19, some 80% of the world’s poorest were estimated to live in fragile contexts by 2030—the end of the Sustainable Development Goals (SDGs).
Africa is a resource-rich continent, specialising in fuel, mineral and agricultural exports. Statistics on revealed comparative advantage (RCA) show that Africa exports proportionally more primary products than most other regions. Crude materials, which include ore, metal, wood, cotton and other raw textiles, are the continent’s dominant product category, followed by tobacco, various agricultural products and fuel. One consequence of specialising in primary product exports is that other countries get to enjoy the benefits of the value they add to these raw materials. These benefits can range from higher profits for their corporations to a more diversified industrial base and consequently better insulation from economic shocks, as well as a more highly skilled, higher-earning workforce.
By Anthony Black, Professor of Economics at the University of Cape Town
With a large and growing middle class, Africa has huge potential as an automotive market. Vehicle ownership rates across the continent are low, at just 45 per 1 000 persons compared with a global rate of 203 per 1 000. Even more striking is the low level of production: the continent accounts for less than 1% of global vehicle output. Outside South Africa and Morocco, production is minimal: most small national markets are supplied by imports, consisting mainly of used cars shipped primarily from Europe, Japan and the US.
By Eyerusalem Siba, Economist and international expert in private sector development, spatial industrial policies and sustainable urbanisation
The Covid-19 pandemic and associated containment measures hit businesses hard, exposing them to record levels of uncertainty, disrupting value chains, and reversing countries’ hard-earned progress in economic and social development. The knock-on effects of these disruptions on GDP, foreign direct investment (FDI), trade and industrial production have been highest among globally integrated economies that have smaller domestic markets, rely heavily on vulnerable sectors and have limited capacity to adjust.