Tag Archives: development

Time to Re-Think Development in Africa?

Naledi Modisaatsone is a CIPE-Atlas Corps Think Tank LINKS Fellow at the Urban Institute.

Africa is in the news. The U.S.-Africa Leaders’ Summit is being held in August, the first of its kind. President Obama will be welcoming leaders from across the African continent to the nation’s capital in less than two months. The summit holds many promises; it could mark a turning point in U.S-Africa relations.

While there are many issues that can be discussed, not all of them should be on the agenda for this summit. To achieve the maximum benefits, it is very critical for African leaders to prioritize just what to put on agenda, and what to leave out. It is tempting to want to bring all the issues, but highly focused interactions are more successful. Topics for discussion should reflect the most critical issues regarding African economies and address challenges to sustainable growth and development.

One important issue is private sector development. Development finance and private sector entrepreneurship are powerful, but under-utilized, assets for development in Africa. While most countries have set goals for inclusive growth, they will not be achieved without better harnessing private sector resources that are ultimately the drivers of development.

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Four Key Ingredients for Accountable Decentralized Government in Lebanon

Under the new law, each village would have representation proportional to its size.

Under the new law, each village would have representation proportional to its size.

Sami Atallah is the Executive Director of the Lebanese Center for Policy Studies, a CIPE partner. This post also appeared on LCPS’s Featured Analysis Section.

Lebanon’s new decentralization draft law may not solve all the country’s ills but, if implemented, could provide the answer to many of the country’s development challenges. The importance of the draft law lies in its ability to strengthen decentralization by transforming the Qadas, the administrative districts, into key developmental actors.

Instead of being headed by central government appointed Qaimmaqams (governor), Qadas will now have a council directly elected by the people. In addition, the Qadas will be endowed with a mandate to provide a wide range of services as well as the fiscal resources to do so.

The Qadas will now be responsible for developing their regions. This will include launching development projects in the sectors of infrastructure, transportation, environment, and tourism, among others. Many of these functions have been re-assigned from the central government because they are more compatible with the geographical area of the Qadas, and because the latter can better realize the economies of scale in the provision of services.

This does not mean that the central government becomes irrelevant, but that it merely shares these functions with other tiers of government. The central government’s role is now focused on policy making and regulation, while regional administrations take charge of service delivery.

The expanded mandate proposed for regional administrations is unworkable if it is not complemented with the required fiscal resources. Since several of the central government functions have been transferred to the Qada, it is natural that a portion of central government resources are transferred to the Qada level as well. To address this, the draft law has re-allocated property tax, a portion of the income tax, real estate registration fees, and other taxes and fees to the Qada in a way that provides the latter with an appropriate level of fiscal resources and autonomy.

The draft law goes further to provide a new source of revenues for the Qada, mainly the Decentralization Fund which replaces the Independent Municipal Fund. This created fund enjoys a new governance structure, more resources and equitable distributional criteria to both Qadas and municipalities.

Qadas with wide mandates and fiscal resources are a necessary but not sufficient criterion for delivering effective development. A key condition is political accountability. The draft law attempts to put in place the appropriate incentives and constraints in order to shape the behavior of local politicians and compel them to deliver more and better services. To this end, the main ingredients of the draft law that aim to achieve political accountability are as follows:

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The Push for Evidence-Based Policymaking in International Development

doing-business-2014

Some central questions in international development are how to measure progress, make sound cross-country comparisons, and build the case for political and economic reforms. Multilateral institutions such as the World Bank play the role of repositories of credible, accessible, and up-to-date information that serves as an international benchmark for progress. Access to information is the basis for evidence-based policymaking and can serve as a catalyst for necessary reforms.

The World Bank recently convened a conference to present research around its  Doing Business index at my alma mater Georgetown University. The keynote speaker, Tim Besley of the London School of Economics, discussed the importance of World Bank data that is publicly available and internationally recognized as a reliable source of evidence-based policymaking.

The Doing Business Survey focuses on two main sets of indicators: regulations and legal institutions. The regulation indicators are the number of procedures, time, and cost involved in starting a business, to obtain a construction permit, getting access to electricity, registering property, paying taxes, and the ability to trade across international borders.

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The Private Sector’s Vested Interest in Citizen Security

Armed security at a Walmart store in Costa Rica, (Photo: La Nacion)

Armed security at a Walmart store in Costa Rica, (Photo: La Nacion)

Security is a fact of life that many of us in the developed world take for granted. I feel fairly confident that I can go about my life on a daily basis with nearly zero contact with crime or violence. Thanks to that security, I feel confident enough to shop, go out to eat, and generally spend time outside of my home and workplace, adding to the local economy. Thanks to this security, my city is growing and developing and life is generally getting better for most people, despite the recent economic recession. Imagine if that were not the case.

At the second level of Maslow’s Hierarchy of Needs lies safety – the security of body, employment, resources, morality, family, health and property. Intuitively we know that our basic needs must be met before we can endeavor to improve our self, our livelihood, our families, or our communities. Without the feeling of safety, people are less able to act freely in a market – to buy products, start businesses, or invest – limiting a country’s potential for development.

It is with this logic that a recent United Nations Human Development Report argues in favor of increasing measures in citizen security in the Latin America region. In this region more than 100,000 homicides are registered per year. The World Health Organization considers these levels epidemic and they are much higher than most other regions of the world today. The report’s authors state, “The level of insecurity many experience impedes human development.”

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The Case for Economic Equality and International Development

At the recent World Economic Forum summit in Davos, Switzerland, global inequality was identified as a "top global risk."

At the recent World Economic Forum summit in Davos, Switzerland, global inequality was identified as a “top global risk.”

Economic inequality has been a growing concern in recent years. The huge gap between the “haves” and the “have-nots” is clearly illustrated by a recent Oxfam report which show that the 85 wealthiest individuals in the world own half of the global wealth. Inequality was also on the top of the World Economic Forum agenda in Davos, Switzerland earlier this year.

There are many reasons to be alarmed by these statistics, but perhaps most importantly we should understand that behind the figures are real people from all walks of life who lack the opportunities to advance their lives and improve their communities. It is also important to remember that the private sector plays a vital role in providing solutions to economic inequality.

At a recent Brookings event “Promoting Shared Societies,” a distinguished panel of experts shared their thoughts on the implications of growing global inequality and the Millennium Development Goals.

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Why Trade is Vital for International Development

container-ships-passing

We live in a globalized world where goods and services are traded across international borders and consumers are able to purchase products with components produced in several countries. What is the role then of international trade in development?

Economists such as Adam Smith and David Ricardo articulated the economic advantage of free trade, which was primarily driven by the idea of “comparative advantage.” A country with a comparative advantage can produce certain goods and services more efficiently and cheaply than others. In terms of international trade, countries with comparative advantage will export goods and services they can produce more efficiently, while importing those they produce relatively less efficiently.

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Investing in Governance for Lasting Growth

Amid the lingering effects of the global financial crisis, there has been an ongoing debate regarding the strategy behind international aid. The question is whether to continue with traditional projects that seek to alleviate poverty through the provision of basic human needs such as health care, education, and food security, or to refocus efforts on building the capacity of local governance thereby making developing countries capable of addressing these issues on their own.  While this debate has been around for at least two decades, current budgetary constraints in donor countries have brought the conversation back into focus.

Speaking in terms of policy, there has long been consensus on the fact that better governance leads to more vigorous economic growth.  Regardless of rhetoric, however, donor agencies have continued to channel the majority of their resources toward areas like infrastructure, agricultural development, and education.  This must change if the development community wants to meet its goals.

On a panel at the Center for Strategic International Studies, Executive Director of the Center for International Private Enterprise (CIPE) John Sullivan joined three other discussants – including a World Bank VP and U.S. Ambassador – to talk about the nexus between governance and growth. The panelists unanimously agreed that governance, specifically democratic governance, is a crucial element of moving developing countries off of foreign aid.  Good governance is an enabler that allows developing countries to better utilize donor funding and develop sustainable, local solutions to challenges.

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