Transcript Recovery from crisis: Projected GDP growth

Africa Open for Business
Vincent Palmade
World Bank
Recovery from crisis: Projected GDP growth
Africa as the next growth pole?
2
Growth has been widespread
Source: Africa Action Plan
Progress in Human Development in Africa
Population living under $1.25/day
Child mortality rates
Primary school enrollment rates
Maternal mortality ratio
Africa has come a long way in terms of
improving financial stability . . .
Source: Laeven and Valencia (2010)
Business climate is improving across the continent
WORLD BANK’S DOING BUSINESS RANKINGS 2011
Source: Doing Business 2011
 Rwanda was the world’s top doing business reformer in 2009
 SSA was the most active among all regions in enacting reforms aimed at
facilitating start-ups and registering property in 2010
 SSA had some of the most comprehensive investor protection reforms e.g.
Botswana, Mozambique, Rwanda, Sierra Leone, Swaziland, Tanzania
Dynamic and Transformative Private Sector
5 game-changers
3
Greater macro stability
and increased voice
makes Africa more
attractive for investors
Democratic elections gaining
ground; conflicts steadily
declining
1
2
New heavy-hitting
investors offer
critical mass
Regionalization is
creating new largescale markets
Brazil, China, Brazil;
private investors,
foundations
Intra-regional trade
growing; new regional
common markets
4
5
Spread and growth
of ICT offer significant
productivity gains
Climate change
creates opportunities
for a green economy
World’s fastest mobile
phone penetration
Africa has low carbon
legacy; chance for green
leadership
6 Key Export Industries
Mining
•
Mining resources could finance power and
transport infrastructure
Construction
•
Urban development to fuel economic
transformation, not slums
Agribusiness
•
Africa to become the world’s food basket
 75% of cultivable land unused
ICT
•
ICT to play a transformative role (remote
services, e-government)
Light manufacturing
•
Wages five times lower than in China –
manufacturing could come
Tourism
•
Unique cultural and natural tourism assets
waiting to be leveraged
Leveraging Mining
• Expanding established areas –
e.g. Zambia, Nigeria
• Large new emerging areas – e.g.
Mozambique, Guinea, DRC
• Good prospects – e.g. Burkina
Faso, Cameroon
• Opportunity to develop
infrastructure through mining
Africa’s Infrastructure Gap
Normalized units
Paved Road Density
Total road density
Main line density
Mobile density
Internet density
Generation Density
Electricity Coverage
Improved water
Improved sanitation
Sub Saharan Africa- Other Low
Low Income
Income
Countries
Countries
31
137
10
55
2
37
16
60
34
134
211
78
76
3
326
41
72
51
Growth in Agricultural Productivity
Real Agricultural GDP
(28 countries value weighted)
5.0
4.0
3.0
# of countries > 5%/yr
2.0
1.0
3
4
2000-04
2001-05
8
5
4
0.0
2002-06
2003-07
2004-2008
Kenya horticulture story
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Smart Support: Government facilitated
arrival of strategic investors.
700
607
570
600
•
•
•
Spillovers: Success of foreign companies
in floriculture led to entry of other
investors, including Kenyans.
Deregulations: Compared to the highly
regulated agricultural sector
Trade Logistics: Leverage of Kenya Airways
Exports, million US$
538
479
500
528
Coffee, tea, matï and
spices.
473
424
Cut flowers and other
plants
403
400
300
350
299
283
Edible vegetables and
certain roots
245
196
200
166
100
2002
2003
2004
211
2005
2006
2007
Source: WITS, and Whitaker and Kolavalli, “The how to technological change
for faster growth in floriculture in Kenya, October 2004 .
Lesotho apparel story
•
Key bottleneck: Land acquisition for foreign
investors is difficult and cumbersome.
5000
4500
4000
•
Policies to address the bottleneck: Industrial
zones and serviced factory shells.
On the job training of workers: Similar
productivity at lower wages than in Asia.
3500
Million Maloti
•
3000
Non-manufactured
exports
Manufactured exports
(of which 60% on
average are apparels)
2500
2000
1500
1000
500
•
Trade Logistics: Leverage of Durban port
0
95 996 997 998 999 000 001 003 004 005 006
19
1
1
1
1
2
2
2
2
2
2
Source: Mallika Shakya, A note on Lesotho
success story .
14
Gorilla tourism in Rwanda
Opportunities in Health
World Bank Group
International Bank for
Reconstruction and
Development (IBRD)
1944
International Development
Association (IDA)
1960
International
Finance
Corporation
1956
Multilateral Investment Guarantee
Agency
1988
International Center for the
Settlement of Investment Disputes
1966
World Bank’s Support to Africa
Partnerships
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-Governments
-AfDB, AU, RECs
- Civil society
- Private sector
- Development
partners
Knowledge
•Link analysis to
policy
•Political economy
•Evidence to
nourish public
debate
Finance
Leveraging:
•Domestic res.
•IDA, IBRD,
IFC,MIGA
•PCGs, enclaves,
etc.
Focusing World Bank Support on
Main Opportunities
1
Business environment reforms:
Reduce cost and risk of doing business
2
Public-private partnerships (PPP)
Address the infrastructure deficit
3
Entrepreneurship, knowledge and
skills: Raise productivity and create
new markets
4
Finance for development: Increase
access to finance and supply long-term
capital, especially for SMEs
The World Bank - AFTFP 2010
Regional solutions
High-impact projects:
• West Africa Power Pool
• Inga 3 hydro-project
• North-South Corridor
Beyond Infrastructure:
•Agricultural research
•Health
•Trade integration
Public Health Laboratory
Network in East Africa