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BRIEF July 26, 2021

Office of the Chief Economist, Africa Region (AFRCE)

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DEMYSTIFYING AFRICAN DEBT FEATURING CARMEN REINHART, WORLD BANK GROUP CHIEF ECONOMIST  

Today we are tackling an issue that is on the minds of every African policy maker, and one that has captured international discussions for several years: African Debt. Debt can be an incredibly useful tool for governments when managed transparently and correctly, and when it is used to fund investments that pay off in the long term. It can fill important funding gaps that development assistance and domestic resource mobilization cannot. But several countries have found themselves in a vicious cycle of debt, effectively mortgaging their people’s futures by agreeing to riskier and less transparent terms that hold their fiscal space hostage. Civil society groups in many places have rightly become increasingly vocal in opposition to borrowing for large projects, advocating for more prudent spending and greater transparency. Host Albert Zeufack, Chief Economist for Africa at the World Bank, discusses this and more with Carmen Reinhart, the World Bank Group’s Chief Economist and an expert on global debt.
Podcast


The Office of the Chief Economist in the Africa Region (AFRCE) generates timely and relevant knowledge on policy and institutional reforms in Sub-Saharan Africa. It produces research articles and reports on the most pressing development issues facing the continent, and fosters a community of economists interested in Sub-Saharan Africa, within the World Bank and on the continent.



Publications

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Africa's Pulse

SPRING 2021

Economic growth in Sub-Saharan Africa is estimated to have contracted by 2.0% in 2020, closer to the lower bound of the forecast in April 2020, and prospects for recovery are strengthening amid actions to contain new waves of the pandemic and speed up vaccine rollouts, according to the World Bank’s biannual economic analysis for the region.

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CPIA

OCTOBER 2020

The 2020 Africa Country Policy and Institutional Assessment (CPIA) report covers the period January to December 2019. The addition of Somalia brought the number of the region’s International Development Association (IDA)–eligible countries to 39. The overall CPIA score for the region’s 39 IDA-eligible countries came in at 3.1, the same as in the previous three years, in a context of moderating per capita growth. The average scores for most of the CPIA clusters trended down in 2019. While the average scores for the economic management cluster was unchanged from last year’s assessment, the average scores for the other three clusters—structural policies, social inclusion, and public management and institutions—have declined, indicating that the quality of policies and institutions in the region’s IDA countries weakened in 2019.

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Accelerating Poverty Reduction in Africa

OCTOBER 2019

This report looks beyond the traditional entry points of macroeconomic stability and growth to ask what more can be done to speed up poverty reduction in Sub-Saharan Africa and where policy makers should focus their attention. This policy agenda requires growth where the poor work and live, and as such, this report centers on what it will take to increase the productivity and earnings of poor and vulnerable people and the financing necessary to make this happen.

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The Future of Work in Africa

Harnessing the Potential of Digital Technologies for All

The report examines how the adoption of digital technologies may change the nature of work in sub-Saharan Africa. It concludes that African countries can turn the promise of digital into reality by enabling entrepreneurship, enhancing the productivity of the informal sector, and extending social protection coverage. Policy makers and private sector partners need to make bold choices and investments today that will allow the next generation of African workers, entrepreneurs, and innovators to thrive.

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Profiting from Parity

Unlocking the Potential of Women's Business in Africa

Sub-Saharan Africa has the highest rate of entrepreneurship in the world, with approximately 42 percent of the non-agricultural labor force classified as self-employed or employers. Yet most entrepreneurs are unable to grow their businesses beyond small-scale subsistence operations, impeding their contribution to poverty reduction and shared prosperity. This is particularly so for women.

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The Skills Balancing Act in Sub-Saharan Africa

Countries face hard choices to strike the right balance between investing in skills that meet the needs of today's highly informal and agrarian economies and investing in the skills needed to foster economic transformation; and between investing in the skills for the current generation and in those for upcoming ones. This report presents rigorous evidence on interventions that work to improve learning, and Sub-Saharan Africa is often at the frontier of these innovations.


Initiatives

Africa Gender Innovation Lab (GIL)

The Gender Innovation Lab identifies scalable solutions for women’s economic empowerment in Africa through impact evaluations that generate evidence on how to close the gender gap in earnings, productivity, assets, and agency.

Think Africa Partnership (TAP)

The Think Africa Partnership bridges the gap between evidence and policy in order to support economic transformation and growth across Africa. TAP brings together an exceptional network of African young professionals, scholars and universities, domestic and regional 'knowledge to policy' think tanks, and a network of over 30 Chief Economic Advisors to Heads of State throughout sub-Saharan Africa.

The Chief Economists of Government Network

This initiative convenes and supports a peer network of chief economic advisors to presidents and prime ministers. It aims to strengthen knowledge-based policymaking in African countries to promote economic growth and transformation.

AERC/World Bank Visiting Scholars Program

The World Bank/African Economic Research Consortium (AERC) Visiting Scholars Program offers four-month research placements for AERC scholars to join the World Bank and its partners to work on African economic policy issues.

CHIEF ECONOMIST, AFRICA REGION

Albert G. Zeufack

Chief Economist

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State of the Africa Region





AFRONOMICS

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AUDIO

Demystifying African Debt Featuring Carmen Reinhart, World Bank Group Chief Economist

Today we are tackling an issue that is on the minds of every African policy maker, and one that has captured international discussions for several years: African Debt. Debt can be an incredibly useful tool for governments when managed transparently and correctly, and when it is used to fund investments that pay off in the long term. It can fill important funding gaps that development assistance and domestic resource mobilization cannot. But several countries have found themselves in a vicious cycle of debt, effectively mortgaging their people’s futures by agreeing to riskier and less transparent terms that hold their fiscal space hostage. Civil society groups in many places have rightly become increasingly vocal in opposition to borrowing for large projects, advocating for more prudent spending and greater transparency. Host Albert Zeufack, Chief Economist for Africa at the World Bank, discusses this and more with Carmen Reinhart, the World Bank Group’s Chief Economist and an expert on global debt.
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