Sector/Thematic Studies

6,525 items available

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http://hdl.handle.net/10986/2110

Economic and Sectoral Work are original analytic reports authored by the World Bank and intended to influence programs and policy in client countries. They convey Bank-endorsed recommendations and represent the formal opinion of a World Bank unit on the topic. This set includes the sectoral and thematic studies which are not Core Diagnostic Studies. Other analytic and advisory activities (AAA), including technical assistance studies, are included in these sectoral/thematic collections.

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Equitable Growth, Finance & Institutions Insight

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The Potential Implications of Economic and Social Rights for Sovereign Debt Investing

(World Bank, 2023-05-24) Gratcheva, Ekaterina ; Gurhy, Bryan ; Wang, Dieter ; Brook, Anne-Marie ; Clay, K.Chad ; Randolph, Susan

This paper discusses both the relevance of economic and social rights (ESRs) for environmental, social, and governance (ESG) investing in the sovereign debt asset class and how to start incorporating these rights into the investment process in a practical way. Many in the investment industry recognize the potential role that investors can play in influencing a country’s decisions on environmental and social issues, including human rights. Investors are also increasingly acknowledging the potential to influence a sovereign’s actions on social issues, such as ESRs, given the state’s direct role in providing a pathway to social advancement for its citizens. The rest of this paper is organized as follows. Section 2 explains the relevance of ESRs to the sovereign debt asset class. Section 3 introduces the income adjusted ESR dataset, and section 4 illustrates the insights that this dataset can provide for sovereign debt investors. Section 5 provides one practical example of how sovereign debt investors could use such a dataset in practice. Section 6 presents our conclusions.
Scaling Up to Phase Down: Financing Energy Transitions in the Power Sector

(Washington, DC: World Bank, 2023-04-20) World Bank

The Scaling Up to Phase Down approach is a contribution by the World Bank to the ongoing debate on how to accelerate energy transition in low- and middle-income countries (LICs and MICs)—as called for by the 2015 Paris Agreement on climate change—while simultaneously widening access to the reliable and affordable energy that underpins countries’ development goals. The approach is intended to be a bridge between the challenges facing World Bank clients who are seeking to transition their power sectors and the development partners supporting their efforts. The energy transition is the process of shifting the global energy system away from the consumption of fossil fuels and toward low-carbon technologies in order to support international goals of limiting climate change. In the next decade, much of this transition will first occur in the power sector because solutions using newer technologies have the potential to become cost competitive with appropriate interventions, and also because the power sector is a powerful pathway for decarbonizing other sectors—most notably transport, buildings, and industry. The power sector is therefore the focus of this report. The power sector transition will advance energy efficiency and decarbonize the energy supply by expanding renewable energy and strengthening electricity networks in order to integrate renewable energy, demand-side management, and end-use electrification. In LICs and MICs, this transition aims to meet the rapidly growing demand for energy in a way that supports inclusive development consistent with net-zero global emissions by mid-century, and builds resilience to the changing climate. A just transition in the power sector should address the needs of workers and communities who are affected by the shift away from fossil fuels; provide modern energy access to millions of people; and protect vulnerable customers from unaffordable energy prices. For the first time, the World Bank has outlined a vision for how the international community can support LICs and MICs to overcome critical barriers that are paralyzing the power sector transition. Drawing on findings of the first set of Country Climate and Development Reports produced by the World Bank, and decades of engagement with energy sector development, this approach distills understanding of the unique challenges that LICs and MICs face in undertaking this transition at the scale and pace required to meet their development and climate needs. The approach may help both World Bank clients and development partners in preparing a roadmap to catalyze and sustain a virtuous cycle that unleashes urgently needed investment in power sector transition. Chapter 1 explains that the capital-intensive nature of clean energy investments, combined with the lack of access to affordable capital, have a disproportionate and distorting effect on the power sector transitions of LICs and MICs. Even where renewable energy has the potential to provide a more affordable energy supply and improve energy security and health, the up-front capital costs that must be borne leave LICs and MICs locked into using costly fossil fuels. Chapter 2 discusses additional barriers to the scaling up of clean energy and the concomitant phasing down of coal. The commitment of governments will be essential in order to foster the policies, regulations, and institutions needed to prepare a pipeline of projects that can attract private capital. This chapter argues that concessional finance is essential in order to overcome the barriers to investments of private capital at the necessary levels. Chapter 3 discusses how public and concessional support must be deployed with a disciplined approach in order to scale up clean energy and energy efficiency. Chapter 4 explains the need to phase down the use of unabated coal, and the instruments to do so in a manner that manages losses and protects the most vulnerable. Chapter 5 concludes the paper with a discussion of how larger and sustained volumes of concessional capital could be more effectively structured within country-based programmatic approaches and technology demonstration partnerships in order to scale up the financial resources and political momentum for transitioning the power sector.
Readiness for Resolving Nonperforming Loans in Central Asia

(World Bank, Washington DC, 2023-04-18) Todoroki,Emiko ; Ahmad Fontan,Ismael ; Dancausa,Fernando ; Iavorskyi,Maksym

The COVID-19 crisis combined with the global repercussions from the Russian invasion of Ukraine exacerbated the stress on financial systems around the world. More than 150 countries introduced policy measures to support the financial sector amid the COVID-19 pandemic. Such measures included debt moratoria, loan forbearance, and the relaxation of classification and provisioning rules, a truly unprecedented response in its scale and speed. Central Asia is no exception. Policy makers in the region introduced temporary measures to support the financial sector during the COVID-19 pandemic. But even before one crisis is contained, the region faces another crisis stemming from the repercussions of the Russian war in Ukraine. Central Asian countries have strong economic and financial ties with Russia, which have, in turn, affected trade, remittances, the subsidiary operation of Russian banks, corresponding banking relationships, payment channels, among other systems. The compounded effect of the two crises has increased the pressure on both the repayment capacity of borrowers and the financial management of banks and other creditors. This report assesses the NPL resolution framework in four Central Asian countries (Kazakhstan, the Kyrgyz Republic, Tajikistan, and Uzbekistan) and provides recommendations for improving it. Chapter 1 discusses the current trend in NPLs in Central Asia. Chapter 2 assesses how assets are classified and covered. Chapter 3 reviews the NPL reduction workout techniques practiced in Central Asia. Chapter 4 investigates supervisory measures that can be adapted to reduce NPLs. Chapter 5 reviews the role that the insolvency and creditors’ rights framework play in this process. The report concludes in chapter 6 with specific recommendations for enhancing the readiness of banks and insolvency regimes for dealing with NPLs. Table 1 summarizes these recommendations.
Pacific Economic Update, February 2023

(Washington DC, 2023-03-14) World Bank

This publication is the inaugural edition of the future publication series on Pacific Economic Update (PEU). It consists of two parts. Part A analyzes the recent economic developments in Pacific Islands. Based on these developments, the PI EU summarizes the outlook for the region’s economies and risks to this outlook. Second, the PEU provides an in-depth examination of a public debt issues in the Pacific and proposes policy recommendations to address public debt related challenges. The PEU is intended for a broad set of audience, including regional forums, policy makers, business leaders, international donors and the community of analysts and professionals engaged in the economies of Pacific Island countries. In dealing with the challenges of rising inflation, tepid recovery from the pandemic and global slowdown, the PICs should strike a balance between supporting livelihoods and reducing future public debt risks. The need for fiscal support during the current environment of high inflation and tepid economic recovery is understandable as it provides the much needed relief for vulnerable households and businesses to navigate the crisis. Nonetheless, these support measures create significant fiscal burdens, and are unsustainable, particularly if the high energy and food prices persist longer than envisaged. Most PICs already face low capacity to finance unexpected shocks which would be further tested by a natural disaster event. Therefore, PICs should tread a delicate balance between fiscal support measures and achieving fiscal sustainability. Any forthcoming fiscal support should be well-targeted, time-bound, and deficit-neutral. Over the medium-term, fiscal efficiency gains and ongoing donor support is critical to finance key development challenges and climate adaptation. Revenue-based fiscal consolidation measures could include improving the efficiency of tax collections and eliminating tax exemptions. On the expenditure side, PICs have limited room to sharply cut spending given the expected modest growth and ongoing development needs. Therefore, it becomes imperative to improve the efficiency of public spending, to maximize social dividends for every dollar spent. Resulting savings from fiscal consolidation measures could help build sovereign wealth funds to provide added fiscal buffers during shocks and economic downturns. Due to high vulnerability to disasters and climate change, PICs will need to seek ongoing concessional financing for critical climate adaptation and development needs.
Opportunities for All: Brazil Policy Notes 2022

(Washington, DC, 2022-12) World Bank

This package of Public Policy Notes is directed to Brazilian policy makers and society to present the World Bank Group’s overview of key challenges facing the country at this juncture, and possible ways forward to address them. We present an agenda prioritized around four issues of core relevance to Brazil’s recovery and its future resilience. First is the goal of financing development sustainably given the immediate challenge of situating the country’s enormous growth, inclusion and climate action needs within a credible macroeconomic framework and efficient and effective fiscal policies. The second theme addressed in this note is building opportunities through productivity-led growth. With the growing reliance of Brazilians on social assistance policies, it is critical to keep sight of growth and jobs as the most important vehicles for the dignity and upward mobility of the poor. Third is increasing the capabilities and economic inclusion of the poor so that they are better able to capture the opportunities that come with growth. Thefourth theme we address in this note is meeting Brazil’s potential as a as a leader in green and climate friendly development. This document is accompanied by a package of six policy presentations and an underlying set of more detailed policy reports that can be accesses here: https://www.worldbank.org/en/country/brazil.
Unleashing Sustainable Finance in Southeast Asia (November 2022)

(Washington, DC, 2022-11) World Bank ; Institute of Finance and Sustainability

Climate change mitigation and adaptation efforts are urgently needed across Southeast Asia. The financial sector can play a critical role in supporting countries in their journey toward greater resilience and sustainability, but it must adapt to do so effectively. This report shows that while sustainable finance has experienced widespread expansion, sustainable financial markets remain small and unable to meet the funding needs of ASEAN-5 economies for their various sustainability objectives. In fact, the reach of sustainable financial markets is extremely limited, with a sizeable gap especially for small and medium enterprises. Survey evidence reveals that underlying these patterns are marked gaps in climate-related information, capabilities, and investment opportunities. This report highlights the importance of developing the financial architecture for sustainability in financial markets, with emphasis on improving the information environment.
Putting Pandemics Behind Us: Investing in One Health to Reduce Risks of Emerging Infectious Diseases

(Washington, DC, 2022-10) World Bank

The COVID-19 crisis brought home the high costs of pandemics, triggering a historic setback in the fight against poverty. It also reinforced the interconnections between people, planet and economy, calling attention to the zoonotic nature of pathogens spilling over from animals to people. To decrease their burden, we must focus on prevention. The One Health approach proposes a way forward to reduce risk of spillover. Recognizing that the health and well-being of humans, animals, and their shared ecosystems are interdependent, One Health is designed as an integrated, practical, multisectoral framework for pandemic prevention. By stopping infectious diseases from spilling over to people and spreading to become pandemics, One Health provides a solid foundation for global health security and improved development outcomes at much lower societal and economic costs. This report aims to shed light on the benefits of prevention to serve as a wake-up call for policymakers and finance ministers alike. The report also outlines an investment framework and One Health architecture for zoonotic disease prevention. As you will read on these pages, compared to the sky-high cost of bringing pandemics under control, relatively modest investments in prevention will pay huge dividends.
Islamic Finance and the Development of Malaysia’s Halal Economy

(World Bank, Washington, DC, 2022-10) World Bank Group

The halal economy (HE) plays an important role in Malaysia’s economic growth, contributing 7.5 percent to the Gross Domestic Product (GDP) as of 2020. Under the Twelfth Malaysia Plan, 2021-2025 (12MP), one of the key strategies to boost Malaysia’s economic growth is enhancing the competitiveness of the halal industry to capture a more significant share of the global halal market. The term halal refers to anything that is permissible or lawful under Islamic Law that dictates the way of life of a Muslim (a follower of the Islamic faith). Hence, the scope of the HE is broad and can be defined as an industry that is involved in the provision of halal products and services, including food, clothing and fashion, cosmetics and personal care, travel, and financial services. Consequently, Islamic finance is both parts of the broader HE (Hassan et al., 2021) and can facilitate the development of the HE. This report requested by Bank Negara Malaysia (BNM) explores the role of Islamic finance in supporting the development of Malaysia’s HE with the objective of informing policy discourse on enhancing existing strategies to increase access to Islamic finance solutions to underserved HE enterprises. The report comprises the following chapters, (1) the current state of the HE; (2) the financing ecosystem of Malaysia’s HE, (3) enhancing role of Islamic finance for the HE in Malaysia; and concludes in Chapter 4 with a set of recommendations for stakeholders in Malaysia. While the recommendations focus on Malaysia, they may also be relevant for other developing economies where the HE and Islamic finance are prominen
Key Principles for Effective Regulation and Supervision of Credit Reporting Service Providers

(Washington, DC: World Bank, 2022-10-01) World Bank

The first section of this report briefly introduces the topic and explains the role of credit reporting systems in the financial infrastructure. The second section briefly discusses the role of the different types of CRSPs and recognizes alternative credit reporting service providers as emerging players in the industry. It also sheds light on the use of new technologies in credit reporting and their potential implications. The third section discusses GPCR as published by the ICCR in 2011. GPCR represents the only universal set of standards for credit reporting as included under the Financial Stability Board (FSB) noncore compendium of standards for the financial sector. GPCR’s five principles describe the respective roles of key stakeholders, accompanying guidance, and recommendations for effective oversight. The section elaborates on the relevance of GPCR for developing key principles for the effective regulation and supervision of CRSPs. In doing so, it provides numerous examples of how GPCR applies in the regulatory frameworks of different jurisdictions around the globe. The fourth section discusses the major types of risks related to credit reporting systems. These risks are not necessarily mutually exclusive and interrelate in many ways, but they can be termed strategic risk, operational risk, cyber risk, model risk, reputation risk, and legal and compliance risk, among others. The section focuses on the evolving role of credit reporting with a forward-looking approach to identify risks and vulnerabilities. The fifth section discusses the key considerations for regulatory and supervisory principles. The section outlines the preconditions for developing and implementing an effective regulatory and supervisory framework and explains the scope of application of the key principles and the responsibilities of regulatory and supervisory authorities. The sixth section then introduces twelve principles for safe and efficient credit reporting along with the roles and responsibilities of the supervisory authority. The seventh section of the report discusses the suggested approach authorities should adopt in applying the principles. This discussion emphasizes the importance of maintaining holistic oversight of how the credit reporting system functions to ensure that the players in credit reporting activities can manage the risks related to credit information sharing. Finally, the eighth section presents the methodology for assessing the regulatory and supervisory frameworks at the jurisdictional level. The assessment methodology is primarily intended for international financial institutions (IFIs), but it is also helpful for national authorities and other internal and external assessors. Assessment responsibility for observing adherence to the key principles primarily lies with individual countries’ regulatory and supervisory authorities.
Strengthening Hydromet and Multi-hazard Early Warning Services in Uzbekistan: A Road Map

(World Bank, Washington, DC, 2022-08) World Bank Group

The road map presents a potential pathway to strengthen Uzbekistan’s national hydrometeorological (hydromet) and multi-hazard early warning systems and services, based on the needs of the user community. It is based on a technical evaluation and assessment of the needs and capacities of Uzhydromet which, as the main service provider in Uzbekistan, issues meteorological and hydrological information, forecasts and warnings. This road map identifies gaps and challenges in the production and delivery of weather, climate, and hydrological information and services, and proposes a strategy for improving the country’s institutional capacity in support of saving lives, protecting property and livelihoods, and social and economic development