Country Economic Memorandum
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Publication
Tajikistan Country Gender Assessment
(World Bank, Washington, DC, 2021-11-30)Tajikistan has a lot to show in terms of creating an enabling policy framework for gender equity, yet large gendered challenges remain. The global COVID-19 outbreak is impacting economies around the world, including Tajikistan, in an unprecedented manner and aggravates existing gender challenges. This report is presenting achievements made and challenges still to be addressed in view of gender-equity in Tajikistan, based on a desk study covering using most recent material from Tajikistan national sources, the World Bank, development partners and others. It is oriented towards key strategic objectives of the World Bank Group (WBG) Gender Strategy for the period of FY17-FY23 with relevance for the Tajikistan context. -
Publication
Lake Chad Regional Economic Memorandum: Technical Paper 3. Estimating the Spillover Economic Effects of Foreign Conflict - Evidence from Boko Haram
(World Bank, Washington, DC, 2021-11-12)Violent conflicts present a formidable threat to regional economies. Throughout the world, border regions in many countries are possibly impacted by the cross-border economic effects of regional insurgencies in neighboring countries or national state failures, i.e. "bad neighbors". This raises two questions. First, what is the magnitude of the spill-over economic effects of foreign conflict and what are the channels through which they operate Second, what policies can governments adopt in the potentially exposed regions to mitigate such spill-over effects. In this paper, we adopt a difference-in-difference (DiD) framework leveraging the unexpected rise of the Boko Haram insurgency in Northeastern Nigeria in 2009 to study its economic effects in neighboring areas in Cameroon, Chad and Niger that were not directly targeted by Boko Haram activities. We find strong cross-border economic effects that are likely driven by reduced trade activities, not the diffusion of conflict. Factors of local economic resilience to this foreign conflict shock then include trade diversification and political and economic securitization. More generally, conflicts, if they have regional economic effects, may necessitate regional responses. -
Publication
Lake Chad Regional Economic Memorandum: Development for Peace
(World Bank, Washington, DC, 2021-11-09)This report sheds light on the interlocked long-term territorial development challenges and the recently realized systemic risks affecting the Lake Chad region. It summarizes the findings of seven technical papers, each investigating different aspects of the interlinked challenges faced by the region. These studies are accompanied by complementary research on labor market and geospatial socioeconomic trends, as well as by a review of the thin literature on economic development across the region. In addition to presenting the main results of the technical papers, the report positions the findings in the broader context of an analytical framework depicting the feedback mechanisms between the region’s territorial development gaps and the self-reinforcing link to shocks, namely, violent conflict and climate change. This analytical framework is presented in Section 1.2. The rest of the report is structured as follows. Section 1.3 describes the main social and economic trajectories in the region. It reviews long-term demographic trends, suggesting. Section 1.4 argues that the low-growth, high-poverty equilibrium observed in the region is closely linked to the region’s economic geography. Section 1.5 discusses how the impact of climatic variation and violent conflict experienced in the region interlink with and exacerbate the territorial development challenges. Section 1.6 presents policy directions structured around four crosscutting themes: infrastructure, trade, governance, and natural resource management. The crosscutting nature of these themes encourages the exploration of potential synergies across challenge areas. The discussion in the section aims to inform policy-making efforts to strengthen territorial development and mitigate the impacts of conflict and climate change. Such endeavors can increase the likelihood of breaking free from the self-reinforcing negative mechanisms and boost the potential return of the region to a path of stability and inclusive economic development. -
Publication
Aiming High: Navigating the Next Stage of Malaysia’s Development
(World Bank, Washington, DC, 2021-02-02)Malaysia is likely to make the transition from an upper-middle-income economy to a high-income economy within the next five years, despite thesetback of the COVID-19-induced recession in 2020. This transition represents an important milestone in Malaysia’s development, having transformed living standards in less than a generation, slashing the extreme poverty rate to less than one percent of the population, and ending the country’s long tenure in the “middle-income trap”. However, Malaysia has been severely affected by COVID-19 and it will take several years beforethe scars of the pandemic are fully erased. The country experienced a “triple shock”: the direct health impact of the virus; the economic impact of movement restrictions; and the growth impact of a global recession. With Malaysia on the verge of achieving this transition, it is an opportune time to address a number of questions regarding the speed of Malaysia’s growth, its quality, and its sustainability. Malaysia is growing slower thanmany countries that achieved high-income status in recent decades. In addition, compared to many other countries that have graduated from middle-income status, it has a lower share of employment at high skill levels and higher levels of inequality. And, compared to countries in the OECD, Malaysia collects less in taxes, spends less on social protection, and performs relatively poorly in terms of measures related to environmentalmanagement and the control of corruption. Many of these fault lines have become exposed during the pandemic. Most significantly, there is a growing sense that despite economic growth, the aspirations of Malaysia’s middle-class are not being met and that the economy hasn’t produced enough well-paying, high-quality jobs. There is a widespread sense that the proceeds of growth have not been equitably shared and that increases in the cost-of-living are outstripping incomes, especially in urban areas, where three-fourths of Malaysians reside. Policies and institutions that have worked in the past may no longer be appropriate for the next stage of Malaysia’s development, with a different set of policies and institutions required at higher levels of income and development. The policies that enabled Malaysia to successfully make the transition from low- to middle-income need to be adapted to meet the challenges it will face in the future. At an earlier stage of its development, factor accumulation was a key driver of Malaysia’s growth. As it makes the transition, it will increasingly need to depend upon more knowledge-intensive and productivity-driven growth, closer to the technological frontier and with a greater emphasis on achieving inclusive and sustainable development. As Malaysia positions itself for the next phase of its development and beyond the pandemic, many of the issues related to this transformation are being addressed and discussed, including through the 12th Malaysia Plan and the Shared Prosperity Vision 2030. With the impact of the COVID-19 pandemic and its potential to depress growth into the future, issues related to Malaysia’s readiness for the future have become even more significant. The analysis in this report suggests that for Malaysia to fulfil its potential, to transition successfully to high-income and developed country status, and to sustain equitable growth beyond that point, reforms are needed in six broad and inter-linked areas: (i) revitalizing long-term growth; (ii) boosting competitiveness; (iii) creating jobs; (iv) modernizing institutions; (v) promoting inclusion; and (vi) financing shared prosperity. -
Publication
Escaping the Low-Growth Trap: Guinea-Bissau Country Economic Memorandum
(World Bank, Washington, DC, 2020-11-02)Guinea-Bissau’s massive economic potential has not so far translated into better livelihoods for its population. Growth per capita has averaged less than 1 percent per year over 2000-2019. This chapter provides an in-depth analysis of the factors behind the economic stagnation. An interplay of three constraints have impeded sustained high growth. First, the low and volatile growth performance is linked to fragility and political instability, which, together with a poorly diversified economy, with raw cashew nuts accounting for 95-98 percent of export earnings, help explain the stop-go growth cycle. Second, human capital accumulation remains low. An acute shortage of a skilled workforce is a major constraint to inclusive growth. The education system is marked by alarmingly low levels of learning. Third, private investment is particularly low—the second lowest in Africa. Years of underinvestment in infrastructure, energy, and human capital are holding the country back from achieving strong, enduring and inclusive growth. The chapter concludes by highlighting how the COVID-19 crisis exacerbates these constraints and discusses areas that could support sustainable growth. The chapter is organized as follows: section 1.1 presents a brief overview of the political and social context. Section 1.2 puts recent growth into historical and comparative perspective. Section 1.3 presents analysis that helps explain the low-growth trap and identifies possible areas that Guinea-Bissau could pursue to escape this trap. Finally, Section 1.4 discusses the economic impact of COVID-19 and potential pathways to recovery. -
Publication
Lessons from Poland, Insights for Poland: A Sustainable and Inclusive Transition to High Income Status
(World Bank, Washington, DC, 2017)This report discusses Poland’s experience along five dimensions. These five dimensions - a pentagon of policies and institutions are governing, sustaining, connecting, growing, and including. The main lessons from Poland and the key insights for its future, based on this pentagon, are presented in the lessons and insights summarized in this report. Poland’s experience underlines the importance of a shared vision to sustain continuing reforms. Poland’s rapid economic ascent created new challenges: the creative destruction on which the growth process was based, successfully, caused massive social change. The report addresses two sets of questions. First, what are the lessons from Poland’s remarkable transition to high income?; what policies were behind Poland’s economic achievements?; why was Poland able to achieve high-income per capita so fast, while many other countries remained in the upper-middle-income range for decades - trapped middle-income countries (MICs)?; what policies were similar to those pursued by other new high income countries (HICs) and what were specific to Poland?, and second, what are the insights for Poland going forward? Given international experience and Poland’s characteristics, what policies can it adopt to continue its ascent and reach the much higher incomes of countries that have been high income for a considerable period - the established HICs?