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on Africa |
| By: | Cleo Rose-Innes (Independent analyst and advisor) |
| Abstract: | The decision to end the use of fossil fuels for energy production by 2050 will result in a permanent collapse in demand for oil. This paper examines the likely effects of this "Africa oil shock" on three large African countries, and whether the International Monetary Fund and the World Bank Group would be able to deliver on their Bretton Woods mandate—avoiding the resulting balance of payments and fiscal crisis. The paper also considers whether the expansion of their mandates to include reducing the risk of climate change and limiting the impact of climate shocks also encompasses actions to minimize or avoid this financing crisis. There are seven recommendations. |
| Date: | 2024–10–07 |
| URL: | https://d.repec.org/n?u=RePEc:cgd:ppaper:342 |
| By: | Andrew AGYEI-HOLMES (University of Ghana - ISSER); Kwadwo Opoku (University of Ghana - ISSER); Richmond Atta Ankomah (University of Ghana - ISSER); Victor Nechifor (European Commission – JRC); Emanuele Ferrari (European Commission – JRC); Ole Boysen (European Commission – JRC); Antti Simola (European Commission – JRC) |
| Abstract: | This study employs the economy-wide model DEMETRA to provide a detailed characterisation of the impacts of the African Continental Free Trade Area on the Ghanaian economy from 2020 to 2035 and how these economy-wide impacts will affect food consumption and affordability. It considers two liberalisation scenarios – tariff-only liberalisation and tariff and non-tariff measures liberalisation – across four potential liberalisation schedules defined by different government revenue, food security and economic development objectives. Results from a continental-level assessment are linked to the DEMETRA model to accommodate changes in international markets as a result of the establishment of the African Continental Free Trade Area. The study shows that tariff-only liberalisation leads to positive effects on trade and that there is a further boost to trade when tariffs are combined with non-tariff measures. A moderate growth in gross domestic product potentially increases capital stock and intermediate goods for manufacturing. Demand for labour in the manufacturing sector also rises, but labour demand in livestock production declines. In terms of food security, prices of processed food generally decline, while prices of cash crops rise. Overall, household consumption of food and other commodities rises. Ultimately, overall government tax revenue falls as a result of a significant reduction in trade taxes, which calls for innovative ways to expand tax collection in country. |
| Keywords: | Trade, Ghana, Africa, general equilibrium model, food security |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc137662 |
| By: | Mounia Boucetta |
| Abstract: | Over the next decade, the energy transition will transform the global economic landscape in terms of regulations, industrial and energy investments, and technological solutions. The African continent is set to play a significant role in this transition while addressing its own sustainable development needs. To fully capitalize on this emerging dynamic, African countries should pursue innovative paths tailored to their specific contexts and constraints. They should also identify strategic levers to advance and accelerate their energy transition, maximizing economic, social, and environmental benefits. |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:ocp:pbcoen:pb_25-24 |
| By: | Malancha Chakrabarty; Karim El Aynaoui; Youssef El Jai; Badr Mandri; Manish K Shrivastava |
| Abstract: | This paper was originally published on t20brasil.org In a global context marked by unprecedented economic and environmental challenges, Africa stands at a crossroads. The rapid rise in public debt, coupled with the climate emergency, imposes a dual constraint on the continent's countries, severely limiting their ability to pursue sustainable development and mitigate the effects of climate change. This critical situation calls for innovative and effective solutions capable of transforming obstacles into opportunities for a more resilient and prosperous future. In the face of this reality, it is imperative to rethink traditional financing mechanisms and explore innovative approaches that promote both debt relief and climate action. In this context, Debt-for-Green Swaps are emerging as a promising strategy, offering a viable path to reduce financial vulnerability while accelerating investments in environmental sustainability. |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:ocp:pbcoen:tf03_st_03 |
| By: | Kirsten, Frederich; Bonga-Bonga, Lumengo; Biyase, Mduduzi |
| Abstract: | The relationship between environmental degradation and poverty has gained importance in the context of the Sustainable Development Goals. While poverty is known to drive environmental degradation, environmental degradation disproportionately affects the poor and reinforces the poverty-environment trap. However, some argue that the poor often display pro-environmental behaviors, environmental stewardship and pro-environmental attitudes that challenge this notion. Understanding how poverty influences individual environmental attitudes is crucial for breaking this cycle. In this study, we examine the non-linear relationship between poverty and environmental concern in Southern African Development Community (SADC) countries, hypothesizing an inverted U-shaped Poverty Environmental Concern Kuznets Curve (PECKC). Utilizing data from the Afrobarometer Round 7 and employing fixed effect polynomial regression model, we confirm that the poverty-environmental concern relationship conforms to an inverted U-shaped PECKC. Specifically, environmental concern is high at low levels of poverty but reaches a poverty threshold beyond which further impoverishment leads to reduced environmental concern. These findings offer policymakers critical insight for designing environmental policies tailored to varying levels of poverty and provide new insight into the poverty reduction and environment degradation discussion. |
| Keywords: | Poverty, Kuznets Curve, Pro-environmental attitudes, SADC, Africa |
| JEL: | C5 D6 Q5 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:122428 |
| By: | Abdelaziz, Fatma; Abay, Kibrom A. |
| Abstract: | Digital innovations hold significant potential to address multiple forms of market failures. However, their adoption remains low and heterogenous across Africa. Smallholder farmers face significant barriers in accessing essential information, limiting their ability to seize market opportunities and enhance profitability. While numerous digital tools have been developed for farmers in the region, most are still in pilot phases. The landscape of digital agricultural innovations in Egypt, the focus of this study, presents a similar outlook, whereby the Egyptian market has an array of innovative digital study, presents a similar outlook, whereby the Egyptian market has an array of innovative digital agricultural tools that offer different services to farmers (including digital advisory agricultural and market services). Several demand and supply-side factors contribute to the low adoption of these digital innovations and their disparities among smallholder farmers in Africa and Egypt. On the supply side, the most important challenges include inadequate public and private investment in complementary infra-structure, unsustainable business models, and a misalignment in the pace of innovation. The most important demand-side challenges include lack of digital literacy, insufficient context-specific needs assessments, digital divide, and accessibility, usability, and user trust. User confidence and trust in digital tools is another important but understudied topic.. However, we lack empirically grounded evidence on alternative supply and demand-side interventions to enhance the adoption and scaling of digital innovations in various contexts, including Egypt. |
| Keywords: | agricultural technology; digital agriculture; digital innovation; smallholders; Africa; Eastern Africa; Northern Africa; Egypt |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:fpr:prnote:152495 |
| By: | Touhami Abdelkhalek; Dorothee Boccanfuso |
| Abstract: | Public policies, particularly those related to taxes and subsidies, should help to reduce poverty and inequality. However, the combination of components of these two systems, as implemented, leads sometimes to an increase in poverty and or inequality without being necessarily anticipated. In this policy brief, based on data from the 2019 wave of the Enquête Panel de Ménage from the Observatoire National du Développement Human from Morocco, we first highlight the influence of taxes and subsidies on household incomes. We derive the income variations relating to the tax burden and gains from subsidies for the different population groups. We then characterize taxes and subsidies in terms of their progressiveness and regressiveness. Finally, using a Shapley decomposition, we determine the contribution of each tax and subsidy to poverty and inequality measures. This analysis is done separately for rural and urban areas, useful to formulate recommendations on this basis. Our results show that the tax and subsidy system, taken all together, is redistributive. We can also conclude unambiguously that this system reduces poverty and inequality. However, the value-added tax is regressive in its current form, unlike income tax, which is progressive. Subsidies for primary and secondary education are highly progressive, while those for higher education are regressive, benefiting the wealthiest quintiles. Finally, explicit subsidies on flour, butane gas, and sugar reduce poverty, although they are not pro-poor.1 |
| Date: | 2023–11 |
| URL: | https://d.repec.org/n?u=RePEc:ocp:pbecon:pb_42-23 |