Publication:
CPIA Africa, June 2024: Structural Reforms for a Vibrant Private Sector

Loading...
Thumbnail Image
Files in English
English PDF (3.94 MB)
7,130 downloads
Other Files
French PDF (4 MB)
5,698 downloads
Date
2024-07-15
ISSN
Published
2024-07-15
Author(s)
Editor(s)
Abstract
The CPIA Africa report highlights policy trends, best practices, and key changes in Sub-Saharan Africa, following the World Bank's annual Country Policy and Institutional Assessment (CPIA). The analysis is designed to assess the elements of policies and institutional arrangements within a country's control for promoting sustainable growth and poverty reduction. Discussion is limited to countries eligible for financing from the International Development Association (IDA), the part of the World Bank that supports the world’s poorest countries. With government investment and spending in Sub-Saharan Africa currently constrained, there is an urgent need for the private sector to accelerate. This year's CPIA Africa report focuses on reforms across policy areas that bolster private sector growth and highlights the policy trends that have been instrumental in supporting business development in 2023. The CPIA 2024 report for Africa underscores several key developments. First, the region has made significant strides in economic management and policies for social inclusion and equity, surpassing the global IDA average. However, the slower improvement in the governance cluster remains a concern. Second, the region has implemented reforms to enhance resilience to international economic shocks, particularly in central bank independence and transparency. Nonetheless, exchange rate pressures have posed challenges for countries actively managing exchange rate fluctuations. Third, the growing debt service obligations in the region limit the amount of resources available for public-sector investment. Public spending is especially constrained in countries with heightened concerns about external debt distress with some countries resorting to increased arrears and monetary financing. Finally, the report highlights two major trends offering hope for private sector growth: digital technology and increased intraregional trade. These trends have the potential to be transformational and provide significant opportunities for increased competition, FDI inflows, and economic diversification.
Link to Data Set
Citation
World Bank. 2024. CPIA Africa, June 2024: Structural Reforms for a Vibrant Private Sector. © World Bank. http://hdl.handle.net/10986/41830 License: CC BY-NC 3.0 IGO.
Associated URLs
Associated content
Report Series
Other publications in this report series
Journal
Journal Volume
Journal Issue

Related items

Showing items related by metadata.

  • Publication
    CPIA Africa, August 2020
    (World Bank, Washington, DC, 2020-08-12) World Bank
    The 2020 Africa Country Policy and Institutional Assessment (CPIA) report covers the period from January to December 2019. The addition of Somalia brought the number of the region’s International Development Association (IDA)–eligible countries to 39. The overall CPIA score for the region’s 39 IDA-eligible countries came in at 3.1, the same as in the previous three years, in a context of moderating per capita growth. The average scores for most of the CPIA clusters trended down in 2019. While the average score for the economic management cluster was unchanged from last year’s assessment, the average scores for the other three clusters—structural policies, social inclusion, and public management and institutions—declined, indicating that the quality of policies and institutions in the region’s IDA countries weakened in 2019. The weakening of structural policies was reflected in the decline in the quality of trade policy, uneven improvements in the regulations affecting factor and product markets, and further deterioration of the financial sector performance. In the area of social inclusion, many countries experienced a decrease in the quality of service delivery that affects access to and quality of health and education services. In the broader area of governance, limited progress was made in strengthening property rights, and transparency and accountability. In addition, the quality of public administration declined, and financial management systems and revenue mobilization capacity weakened in many countries.
  • Publication
    CPIA Africa, November 2021
    (World Bank, Washington, DC, 2021-11) World Bank
    The Country Policy and Institutional Assessment (CPIA) 2021 Africa report provides an assessment of the quality of policies and institutions of International Development Association (IDA); eligible countries in Sub-Saharan Africa in calendar year 2020, at the height of the COVID-19 pandemic. The report analyzes the CPIA scores for 2020 to assess the extent to which the policies and institutions of the region's IDA countries are fostering sustainable growth, poverty reduction, and the effective utilization of development resources. The CPIA scores quantify the level of performance of each country against 16 criteria that represent the policy and institutional arrangements of an effective poverty reduction and growth strategy. The criteria are grouped into four clusters: economic management, structural policies, policies for social inclusion and equity, and public sector management and institutions. Countries are rated on a scale between 1 and 6, with high and rising scores signifying stronger policy and institutional frameworks.
  • Publication
    CPIA Africa, October 2022
    (Washington, DC, 2022-10) World Bank
    The Country Policy and Institutional Assessment (CPIA) Africa 2022 report provides an assessment of the quality of policies and institutions for the calendar year 2021 in all 39 countries in Sub-Saharan Africa that are International Development Association (IDA)–eligible. The overall average score for these countries remained unchanged from the previous year at 3.1. Similarly, no changes were observed at the subregional level, where average scores were unchanged at 3.2 and 3.0 for West and Central Africa and East and Southern Africa, respectively. However, at the country level, the overall CPIA scores changed in 11 countries, including an increase in seven countries and a decline in four. Among the countries that increased their CPIA scores, nearly 70 percent has done it on account of better policies for social inclusion and equity. Among the four countries with decreased CPIA scores, three are assessed with weakened performance in macroeconomic management. Countries with below average scores (under 3.0) are mostly fragile and conflict-affected cases. Section 1 of this report evaluates the impact of the pandemic on economic performance in Sub-Saharan Africa’s IDA-eligible countries, particularly focusing on key macroeconomic outcomes. Section 2 of the report presents the CPIA assessment results by clusters, by criteria, as well as by countries, while distinguishing between fragile and non-fragile countries. Section 3 provides the individual country CPIA pages.
  • Publication
    CPIA Africa, September 2023
    (Washington, DC: World Bank, 2023-09-12) World Bank
    The Country Policy and Institutional Assessment (CPIA) for Africa is an annual diagnostic tool for Sub-Saharan African countries that are eligible for financing from the International Development Association (IDA), the part of the World Bank that helps the world’s poorest countries. The CPIA Africa 2023 report provides an assessment of the quality of policies and institutions in all 39 IDA-eligible countries in Sub-Saharan Africa for calendar year 2022. The average overall CPIA score for Sub-Saharan Africa remained unchanged at 3.1 in 2022. Economic and social resilience continues to be tested in all countries in Sub-Saharan Africa amid tight global credit markets, as institutional capacity for restoring stability and delivering sustained growth remains a challenge. Such resilience is also fundamental to responding to global climate change and the expected market shifts as the world economy transitions to green energy. The recovery of economic activity in the region following the slowdown caused by COVID-19 has been multispeed, with wide variation across countries. Global events that diverted attention away from longer-term development priorities marked 2022. Inflation was the predominant form in which international pressures translated to domestic economies in Sub-Saharan Africa, resulting in stress on social policies and government budgets, on account of divergent responses by governments and private sector competition. In some countries, this has led to significant stress on debt sustainability, highlighting the importance of debt management, budgetary oversight, and financial soundness. An opportunity for regrouping on policy reforms arose in the second half of 2022, as gas prices declined after a mild European winter and China lifted health-related restrictions. Despite global economic challenges, more countries in Sub-Saharan Africa saw improvements in their overall CPIA scores compared to the previous year. In Western and Central Africa (AFW), the overall score increased for eight countries—Benin, Cabo Verde, Côte d’Ivoire, The Gambia, Guinea, Guinea-Bissau, the Republic of Congo, and Togo. The overall score increased for four countries in Eastern and Southern Africa (AFE)—Burundi, the Democratic Republic of Congo, Mozambique, and Zambia. In contrast, the overall score decreased for eight countries—Chad, the Comoros, Eritrea, Ethiopia, Ghana, Malawi, São Tomé and Príncipe, and Sudan. The countries with improved scores made notable advancements in the economic management, policies for social inclusion, and governance clusters. Conversely, the countries with declining scores faced economic management and governance challenges. For the most part, the countries that received downgrades were positioned toward the lower end of the scale, while the upgraded countries generally had overall scores above 3, indicating a growing divergence in scores across the region in 2022.
  • Publication
    CPIA Africa, June 2013
    (Washington, DC, 2013-06) World Bank
    This report is the second in a series of annual reports describing the progress African countries are making on strengthening the quality of policies and institutions that underpin development. It presents Country Policy and Institutional Assessment (CPIA) scores for the 39 African countries that are eligible for support from the International Development Association (IDA). The development literature identifies the components of the CPIA as being broadly relevant for sustaining growth and reducing poverty. The data provide some support for this association. All country groups exhibit similar patterns across the four CPIA clusters. The gap in scores between the macroeconomic management cluster and the governance cluster is just as pronounced for fragile as for non-fragile states. In contrast, the gap between the economic management cluster and the social policies and structural policies clusters is small. Overall, the macroeconomic policy stance in Sub-Saharan Africa was supportive of growth, with monetary policy focused on managing inflation and fiscal policy focused on pro-poor spending and infrastructure development. Inflation declined in 2012, thanks to a moderation in food and fuel prices and prudent monetary policy. However, an expansive fiscal policy translated into a weakening of fiscal balances. Debt levels also edged up, although they remained moderate. As the policy areas in this cluster are closely related, there tends to be co-movement in the scores for monetary and fiscal policy.

Users also downloaded

Showing related downloaded files

  • Publication
    FY 2024 Dominican Republic Country Opinion Survey Report
    (Washington, DC: World Bank, 2024-10-22) World Bank
    The Country Opinion Survey in the Dominican Republic assists the World Bank Group (WBG) in better understanding how stakeholders in the Dominican Republic perceive the WBG. It provides the WBG with systematic feedback from national and local governments, multilateral/bilateral agencies, media, academia, the private sector, and civil society in the Dominican Republic on 1) their views regarding the general environment in the Dominican Republic; 2) their overall attitudes toward the WBG in the Dominican Republic; 3) overall impressions of the WBG’s effectiveness and results, knowledge work and activities, and communication and information sharing in the Dominican Republic; and 4) their perceptions of the WBG’s future role in the Dominican Republic
  • Publication
    Latin America and the Caribbean Economic Review, October 2024: Taxing Wealth for Equity and Growth
    (Washington, DC: World Bank, 2024-10-09) Maloney, William; Zambrano, Jorge Andres; Vuletin, Guillermo; Beylis, Guillermo; Garriga, Pablo
    The report highlights the progress made on inflation and, despite some resistance in the last mile, the resulting fall in interest rates that will ease pressures on debt service and investment. However, growth is projected to remain low, debt remains high, private and public investment is depressed, and the region appears to be missing the boat on nearshoring FDI. The need to generate more fiscal space, reduce the high corporate tax burden, and mitigate persistent inequality have moved wealth taxes to center stage. But traditional wealth taxes on financial assets face challenges due to the ease of moving and hiding assets which will be difficult to control without elusive global coordination. A viable alternative is a tax on real estate which is less mobile, easier to track, and less of a distortionary burden on economic activity, given the low initial rates. Property taxes also have the potential to reduce the excessive dependence of subnational governments on federal transfers. For property taxes to play a greater role, there must be improvements in property valuation which can be engineered through the use of digital platforms and centralized land registries.
  • Publication
    Dominican Republic Poverty Assessment 2023
    (Washington, DC: World Bank, 2023-11-08) World Bank
    In recent decades, economic growth in the Dominican Republic (DR) has been steady. However, growth has not occurred in such a way as to make the benefits widely and evenly available. In fact, although the DR economy grew faster than that of other LAC countries before the Covid-19 pandemic, its poverty rates and social outcomes remain broadly similar to them. This report seeks to explain this conundrum, as well as to expand the knowledge base to improve the effectiveness of ongoing poverty reduction policies in the DR. The Poverty Assessment draws primarily on new analytical work conducted in the DR, structured around four background notes on: (i) trends in monetary poverty and inequality, as well as the key drivers of those changes; (ii) nonmonetary poverty and its spatial dimensions; (iii) social assistance programs and their role in mitigating poverty; and (iv) climate change and its interaction with poverty. By helping to reduce the evidence gap in each of these areas, our analysis hopes to inform government policies and the national dialogue on poverty reduction. In addition, the note integrates existing analytical work and evidence produced inside and outside the Bank, including from its operations in the country.
  • Publication
    Business Ready 2024
    (Washington, DC: World Bank, 2024-10-03) World Bank
    Business Ready (B-READY) is a new World Bank Group corporate flagship report that evaluates the business and investment climate worldwide. It replaces and improves upon the Doing Business project. B-READY provides a comprehensive data set and description of the factors that strengthen the private sector, not only by advancing the interests of individual firms but also by elevating the interests of workers, consumers, potential new enterprises, and the natural environment. This 2024 report introduces a new analytical framework that benchmarks economies based on three pillars: Regulatory Framework, Public Services, and Operational Efficiency. The analysis centers on 10 topics essential for private sector development that correspond to various stages of the life cycle of a firm. The report also offers insights into three cross-cutting themes that are relevant for modern economies: digital adoption, environmental sustainability, and gender. B-READY draws on a robust data collection process that includes specially tailored expert questionnaires and firm-level surveys. The 2024 report, which covers 50 economies, serves as the first in a series that will expand in geographical coverage and refine its methodology over time, supporting reform advocacy, policy guidance, and further analysis and research.
  • Publication
    Pastoralism Development in the Sahel
    (World Bank, Washington, DC, 2016-05-04) De Haan, Cees; Dubern, Etienne; Garancher, Bernard; Quintero, Catalina
    The World Bank’s Global Center on Conflict, Security, and Development, currently the Fragility, Conflict, and Violence Cross-Cutting Solutions Area (FCV CCSA), in 2014 commissioned this note to enhance understanding of the connection between pastoralism and the recent increase in instability and violence in the Sahel, as well as the conditions under which the development of the pastoralist economy can actually enhance regional stability. The note seeks to offer guidance to international, national, and local decision makers on the drivers of conflict and instability that are most related to pastoral communities, as well as possible measures to reduce violence and enhance stability in the Sahel.