Abstract

This note, prepared as background for the G20 submission, explores the potential for Multilateral Development Banks (MDBs) to increase the volume of climate financing by leveraging and intermediating resources, through two main avenues: leveraging shareholder capital through the MDBs non-concessional windows, by raising debt from capital markets to finance climate investment; and mobilizing and 'pooling' concessional flows to support climate investment beyond the MDBs own balance sheets. The note is organized along these two lines, with the aim of providing some insights into the feasibility for MDBs to mobilize resources to leverage a significantly larger volume of climate financing assistance. The next section of this note provides information on how MDBs can support concessional flows to climate investments through pooling of external concessional flows beyond traditional balance-sheet capital. Leveraging shareholder capital and mobilizing and-pooling concessional flows are two potential avenues through which MDBs can leverage and intermediate resources to ultimately increase the volume of climate financing. The experience gained by the MDBs and their clients and donors from implementing these financing arrangements should provide helpful lessons for the development community as it considers how to develop the green climate fund and other future climate change initiatives. Document type: Book

Abstract

This paper proposes a new measure of public expenditure force that policy makers and budget analysts should track in detail over time in routine fiscal monitoring. The paper suggests that adopting the measure will not only warn policy makers of possible impending fiscal pressures, but will help them to differentiate between those budgetary pressures that are temporary and those that may require reforms. The main utility of the expenditure force measure will be in country fiscal analysis. Measuring force across the entire budget allows practitioners to monitor and decompose the micro drivers of public spending pressure, watch out for rapidly expanding spending lines, and identify priorities for reform before these pressures lead to macro fiscal problems. Yet by its construct, spending force is internationally comparable, and independent of expenditure levels or spending types. This could allow global monitoring comparisons and global research into the drivers of public spending force across particular types of country characteristics and economic conditions. In time, and as more data become available, researchers can use the force measure to compare and contrast the dynamics of expenditure types across countries. For example the measure can be used to explore what gives some spending types an initial impulse; whether underlying factors cause different public spending categories to grow faster than average, or to accelerate over time; and what successful countries have done to manage rising force without damaging public services. Since force seems to be a decent predictor of fiscal episodes, it is suggested that “speed limits” for spending might be a feasible component of fiscal rules. Document type: Book

Abstract

This study briefly summarizes the development experiences of special economic zones in China and Africa, the lessons that Africa can learn from China, and the preliminary results of the Chinese investments in special economic zones in Africa. The study makes recommendations on how to unleash the power of special economic zones and industrial zones in Africa through strategically leveraging the Chinese experiences. The success factors of Chinese special economic zones include the strong and long-term commitment of the government, a conducive business environment in the zones, strategic locations, technology upgrading and skills training, and strong linkages with the local economy. However, the Chinese experiences highlight some pitfalls to avoid, such as the “mushroom approach” and high-level overlaps at the later stage, environmental degradation, and the unbalance between industrial development and social dimensions. This calls for a bigger role for the market. Sub-Sahara Africas experience with traditional economic zones has been relatively poor, except in a few countries, such as Mauritius. The key challenges include the poor regulatory and institutional framework, lack of effective strategic planning, weak governance and implementation capacity, and inadequate infrastructure, among others. Since 2006, China has implemented special economic zone projects globally, including in four countries in Sub-Saharan Africa. It is still too early to conduct a full assessment of these projects; however, the evidence shows that some zones have begun to attract investments and make important contributions to the local economy. The main challenges include access to land, regulatory barriers, resettlement and coordination issues, and lack of external infrastructure. Document type: Book

Abstract

Transport infrastructure is deemed to be central to development and consumes a large fraction of the development assistance envelope. Yet there is debate about the economic impact of road projects. This paper proposes an approach to assess the differential development impacts of alternative road construction and prioritize various proposals, using Nigeria as a case study. Recognizing that there is no perfect measure of economic well-being, a variety of outcome metrics are used, including crop revenue, livestock revenue, non-agricultural income, the probability of being multi-dimensionally poor, and local gross domestic product for Nigeria. Although the measure of transport is the most accurate possible, it is still endogenous because of the nonrandom placement of road infrastructure. This endogeneity is addressed using a seemingly novel instrumental variable termed the natural path: the time it would take to walk along the most logical route connecting two points without taking into account other, bias-causing economic benefits. Further, the analysis considers the potential endogeneity from nonrandom placement of households and markets through carefully chosen control variables. It finds that reducing transportation costs in Nigeria will increase crop revenue, non-agricultural income, the wealth index, and local gross domestic product. Livestock sales increase as well, although this finding is less robust. The probability of being multi-dimensionally poor will decrease. The results also cast light on income diversification and structural changes that may arise. These findings are robust to relaxing the exclusion restriction. The paper also demonstrates how to prioritize alternative road programs by comparing the expected development impacts of alternative New Partnership for Africas Development projects. Document type: Book

Abstract

With most of the global population and capital goods concentrated in urban areas, cities are key to social development and economic prosperity. They are drivers of national economic growth and innovation, and act as cultural and creative centers. Many development partners and other organizations are active on the topic of resilience in cities, and there has been a recent upswing in the development and promotion of innovate programs, tools, and initiatives. Arup International and the Rockefeller Foundation have developed the city resilience framework, which provides a lens through which the complexity of cities and the numerous factors that contribute to a city’s resilience can be understood. The framework is being used to facilitate agenda-setting sessions in cities selected to participate in the 100 resilient cities challenge. Within this global context, the city strength diagnostic was developed to help World Bank staff apply this new holistic approach to urban resilience to operations. It was designed to help facilitate a dialogue among stakeholders (for example, government, civil society, residents, and the private sector) about risks, resilience, and the performance of urban systems. The city strength diagnostic results in the identification of priority actions and investments that will enhance the city’s resilience as well as increase the resilience building potential of planned or aspirational projects. It stresses a holistic and integrated approach that encourages cross-sectoral collaborations to more efficiently tackle existing issues and to unlock opportunities within the city.

Abstract

Cambodia’s rice harvests have been rising significantly since 2005, powered by improved and expanded irrigation and attractive farm gate prices. In 2010, the Cambodian government announced an export target of 1.0 million tons of milled rice by 2015. This analysis, which updates reports prepared in 2009 and 2011, seeks to identify short-term policy measures that can assist Cambodian exporters in boosting exports in the near term. This report examines new and expected investments in the larger rice mills and polishing factories, export trends, recent changes in milling costs, and provides a look at logistical costs and some alternatives. Additionally, import trends are examined in two current markets - the European Union (EU) and Russia, and in three other key markets - Indonesia, the Philippines, and China. Finally, an analysis is provided of the current Thai rice policy which impacts on local prices and investment interests by Thai rice exporters.

Abstract

Developed at the request of the Mexican G20 Presidency for consideration by the Finance Ministers and Central Bank Governors at the G20 Leaders' Summit in Mexico, and jointly prepared with the Asian Development Bank, this policy paper positioned green transport in the context of cities development. Urban transport determines the shape of a city and its ecological footprint. Many cities in low and middle income countries are at a crossroads. Policy decisions taken now, while car use is still relatively low and cities retain a relatively transit friendly, compact urban form, will affect how people will live in their cities for many decades into the future. A new paradigm of urban transport can be part of the solution to reversing the deteriorating situation in some cities of developing countries, and supporting others to embark on a sustainable, low carbon, green growth path: developing a city for people rather than cars, and including public and mass transport as a major component of the modal structure. Implementing such a new paradigm can be truly transformational. This joint World Bank and Asian Development Bank paper lays out six aspects, which are most difficult to align, yet, are critical to ensure the sustainability of urban transport systems, visionary leadership, integrated strategy for land use and urban transport, coordination among agencies, domestic capacity, adequate cost recovery, and private participation in the operation and construction of urban transport systems. The paper proposes a set of new initiatives for G20 leaders' consideration, including the development of an umbrella toolkit to guide policy makers in charge of urban planning to make transport decisions best suited to their local contexts.

Abstract

Turkey’s demographic and economic transformation has been one of the world’s most dramatic, with urban growth and economic growth proceeding hand in hand. Distinguishing Turkey from many other developing countries has been the pace, scale, and geographical diversity of its spatial and economic transformation. Fast-growing secondary cities bring added challenges that define Turkey’s second-generation urban agenda. New and differentiated service standards will need to be established across both dense urban built-up areas and small villages and rural settlements within the newly-expanded metropolitan municipality administrative area. These developments make planning, connecting, and financing important policy principles for Turkey’s second-generation urban development agenda. This policy brief frames a second-generation urban development agenda to support Turkey’s transition from upper middle income to high income.

Abstract

This report seeks to shed light on the ways in which the services sector has contributed to Lao PDR’s competitiveness and integration into the global marketplace. It focuses on two complementary roles that the services sector plays: first, as an avenue for export diversification and growth and, second,by providing inputs into other productive sectors of the economy, such as the manufacturing sector. As economies grow, the importance of the services sector generally increases, but its role as an enabler of other sectors of the economy in moving up the value chain is frequently overlooked. However, the services sector is critical in raising competitiveness of these other sectors to boost growth and create better quality jobs. The main policy recommendations that emerge from this report are aimed at increasing competition in the services sector, reducing distortive regulations, and opening up the sector to foreign participation, building up skills, both at the individual and at the firm level, and investing in hard and soft infrastructure to promote the development of the sector.

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.