Abstract

This paper includes three parts: external economic environment, part one includes: global environment, regional environment, and risks. Vietnam's recent economic development, part two includes: a relatively stable macroeconomic situation, growth at record low, booming exports despite a slowing economy, sharp turnaround in external accounts, inflation dynamics, monetary policy, fiscal policy, and near-term outlook. Structural reforms and medium-term outlook, part three includes: context, restructuring of state-owned enterprises, banking Sector development, and poverty reduction. Document type: Book

Abstract

The experience of countries in transition from a planned to a market-oriented economy has varied greatly. The clearest differences are between the East Asian countries, China and Vietnam, and the countries of Central and Eastern Europe (CEE) and the former Soviet Union (FSU). China and Vietnam have contained inflation and benefited from continued high growth in GDP since the beginning of their reforms, while all CEE and FSU countries have experienced large declines in output, and most have experienced hyperinflation. But even in CEE and the FSU, differences are marked. Some countries have lost over half of their GDP, and growth performance in a number of countries is still poor, while others are growing strongly. Some are still suffering from high inflation while others have successfully reduced annual inflation. What determines this divergence of outcomes across transition countries? No study so far has analyzed the interaction of all factors, including initial conditions, political change, and reforms, in a unified framework including CEE, the FSU, China, and Vietnam. The authors examine these broader interactions, but focus first on the role of initial conditions, such as initial macroeconomic distortions and differences in economic structure and institutions, which have been emphasized less in the literature. They find that initial conditions and economic policy jointly determine the large differences in economic performance among the 28 transition economies in the sample. Initial conditions dominate in explaining inflation, but economic liberalization is the most important factor determining differences in growth. But reform policy choices are not exogenous. They depend, in turn, on both initial conditions and political reform, with political reform the most important determinant of the speed and comprehensiveness of economic liberalization. Other findings provide additional insight into these relationships. Results show that liberalization has a negative contemporaneous impact, but a stronger positive effect on performance over time. The results also show that macroeconomic and structural distortions are negatively related to both policy and performance. Regarding the former, unfavorable initial conditions discourage policy reforms but do not diminish their effectiveness once they are implemented. The authors find some evidence that the influence of initial conditions diminishes over time. This is in part because many of the initial conditions are themselves modified in the course of transition. Monetary overhangs are dissipated through inflation, industrial overhang is eroded as plants shut down, and market memory returns through experience. Document type: Book

Abstract

The Malaysian economy decelerated as solid domestic demand was not sufficient to offset a weakening external environment. Private consumption growth continued at a healthy pace. Favorable rubber and palm oil prices drove up incomes of smallholders while continued employment and wage growth supported urban incomes. In contrast, fixed investment was more volatile, with private investment showing signs of picking up while public investments lagged. Malaysia's overall balance of payments recorded a larger surplus in the first half of the year reflecting a widening current account surplus and substantial net financial inflows. Malaysia's open economy is expected to slow further in the remainder of 2011 and into early 2012 mainly due to the deterioration in the outlook for external demand. Cities are central to Malaysia's aspiration to become a high-income economy. Smart cities are skilled and innovative. They play a crucial role in catalyzing economic growth by generating productivity gains through agglomeration economies. Smart cities are green and sustainable. They ensure a high quality of life to all citizens and the sustainability of economic gains. Finally, smart cities are resilient.

Abstract

The devastating civil war in Syria is arguably one of the major civil conflicts in recent times. The conflict started with protests in March 2011 and soon after escalated to a violent internal war with no end in sight to this date. The conflict has by the end of 2014 caused well in excess of 150,000 fatalities, and 6 million internally displaced people (UN), and led 3 million refugees to move out of the country (UNHCR). Beyond the human tragedy, the conflict has disrupted the functioning of the economy in many ways. It has destroyed infrastructure, prevented children from going to school, closed factories and deterred investments and trade. The economic effects of the war extend beyond the country’s borders affecting also the neighboring countries. In particular trade is one of the main channels through which the effects of the crisis are transmitted to neighboring countries. For example, the demand for goods and services in Syria is likely to have fallen thus affecting the many exporters to Syria in neighboring countries. Moreover, to the extent that Syria has become harder to cross, the war may have made trade through Syria more difficult. At the same time producers in neighboring countries may have replaced Syrian producers in Syria and in other markets as their productive assets in Syria were destroyed. This report examines the effects of the Syrian war on the Lebanese economy via one of the most important channels through which the economic impact of the war occurs, i.e. the trade channel. In doing so, it partly updates and extends the previous economic assessment of World Bank (2013b) carried out last year. Focusing specifically on trade allows us to examine in more depth the trade effects than that report was able to do. Indeed, we go beyond the effects on aggregate and sectoral imports and exports to also examine the effects on exports at firms’ level, comparing the effects in Lebanon with those in other neighboring countries, including Jordan, Turkey and Iraq.

Abstract

This Country Partnership Framework (CPF) presents the World Bank Group (WBG) program and the associated results framework for Lebanon for the period FY17-FY22. In a fragile and conflict-prone environment, this CPF aims at mitigating the immediate, and potentially long-lasting impact of the Syria crisis on Lebanon, while strengthening state institutions, addressing existing vulnerabilities, and bolstering efforts on longer term development challenges, all through interventions that foster inclusion and shared prosperity. The CPF will work through two focus areas as a way to renew the social contract between the state and the citizens: (i) expand access to and quality of service delivery; and (ii) expand economic opportunities and increase human capital. Through these two focus areas, the WBG will help Lebanon mitigate the economic and social impact of the Syria crisis, safeguard the country’s development gains, and enhance the prospects for stability and development in the coming years. The CPF will contribute to strengthening the relationship between the state and its citizens, a critical ingredient for peace and stability. The CPF will contribute to strengthening the relationship between the state and its citizens, a critical ingredient for peace and stability. The CPF benefited from a series of stakeholder consultations, including those held in connection with the Systematic Country Diagnostic (SCD) and the WBG Gender Strategy.

Abstract

Despite the recent slowdown, the underlying growth of the global economy remains solid. After a 4 percent growth in 2010, Russia's real output is expected to grow 4.4 percent in 2011, increasingly driven by domestic demand. Russia's households have absorbed the food price shock thanks to a combination of higher wages and pensions, and resort to private and public safety nets. The country emerged from the global recession with lower unemployment and poverty than feared. But global risks and uncertainties increased with the new oil shock. Although the short-term impact will be positive for Russia's export and fiscal revenues, there is no room for complacency. Macroeconomic policy should focus on the short-term objective of controlling inflation and medium-term fiscal adjustment towards long-term, sustainable level of non-oil fiscal deficit. Improving the efficiency of public expenditure to create fiscal space for productive infrastructure and strengthening the investment climate for the private sector remain among key long-term challenges. The ongoing rethinking of the government's long-term strategy and a period of high oil revenues provide an opportunity to focus on these long-term issues more forcefully than during the global crisis.

Abstract

The country partnership framework (CPF) for Azerbaijan covering the period FY2016-20, sets out the World Bank Group (WBG) support to the country on its path toward a sustainable, inclusive, and private sector-led growth underpinned by a diversified asset base. The country’s strategic goals are laid out in its development strategy - Azerbaijan 2020: vision for the future and other strategic documents that aim at reducing Azerbaijan’s dependence on oil and gas revenues and strengthening its resilience to external shocks through investments into diversified human capital, physical infrastructure, and stronger institutions. The CPF builds on the WBG systematic country diagnostic (SCD) for Azerbaijan and aligns its objectives with the constraints and priorities identified in the SCD. Over the past decade, Azerbaijan has made remarkable progress toward reducing poverty and boosting shared prosperity. In response to the emerging challenges and the mounting depreciation pressures, the government devalued the national currency and committed to fiscal consolidation. The CPF takes into account the government’s intention to optimize the external borrowing over the medium term as part of the ongoing effort to maintain fiscal sustainability. The CPF lending program will help Azerbaijan in meeting its development objectives through engagement in priority areas where the country’s ownership is strong, where the WBG has a comparative advantage and where the potential impact on the WBG twin goals is substantial. The CPF will address the SCD connectivity agenda through investments into the development of the county’s transport and transit corridors as well as improvement of local infrastructure at the community level. The CPF results are grouped around two focus areas and eight objectives that aim at improved public sector management and service delivery, and enhanced economic competitiveness.