Post on 01-Apr-2015
einstitute.worldbank.org
Emerging Issues in Development Policy
Africa’s emergence and the implications for the aid architecture
January 31, 2013 | 10:00 AM EST
Speaker: Wolfgang Fengler
Lead Economist
World Bank, Nairobi
2
Main messages
o Africa is starting to catch-up but yet to experience economic transformation. Over the last decade Africa experienced a recovery after two lost decades.
o The y-factor explaining Africa’s emergence: Demography, Geography, Technology and Policy.
o Africa’s emergence will have major implications for the future aid architecture. From now on, most of the World’s poor live in fragile states.
3
Africa’s emergence
4
Africa’s three distinct periods of economic performance
5
Africa’s catch-up since 2000
-4
-2
0
2
4
6
8
10
World
Developing
High-income
Sub-Saharan Africa
Africa’s ride to Middle Income
7
Most of the poor now live in fragile states
8
The y-factor
Demography – Geography – Technology – Policy
9
Demography: Africa will experience a demographic dividend
1950 1956 1962 1968 1974 1980 1986 1992 1998 2004 2010 2016 2022 2028 2034 2040 20460
500
1,000
1,500
2,000
2,500Sub-Saharan Africa population trends
Total Population
Working Ages 15-64
Youth 0-14
Older 65+
Po
pu
latio
n in
mill
ion
s
10
… while Europe and North America’s share in global population is declining
1950 1954 1958 1962 1966 1970 1974 1978 1982 1986 1990 1994 1998 2002 2006 2010 2014 2018 2022 2026 2030 2034 2038 2042 2046 20500.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
AFRICA ASIA
EUROPE LATIN AMERICA AND THE CARIBBEAN
NORTHERN AMERICA
11
Geography: Africa is urbanizing rapidly19
90
1995
2000
2005
2010
2015
2020
2025
2030
2035
2040
2045
2050
—
10.00
20.00
30.00
40.00
50.00
60.00
70.00
80.00
90.00
Percentage of population living in Urban areas
Sub-Saharan AfricaWorldKenyaSouth AfricaGhanaAsia
% o
f tot
al p
opul
ation
12
Geography; Example Kenya: Net population growth will be urban
2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 20500
20
40
60
80
100
22 2429 31 33 34 33 32 30 27
22
810
1215
1924
3037 45 53 63
Rural Urban
13
Technology: Today, Africa has more phones than adults
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 20110
20
40
60
80
100
120
140
160
180
200
Kenya
South Africa
Nigeria
Ghana
Tanzania
Uganda
Ethiopia
Cellular subscription as % of population +15
14
Policy, especially macroeconomic management
2006 2007 2008 2009 2010 20112.9
3
3.1
3.2
3.3
3.4
3.5
3.6
3.7
3.8
Macro-economic Management
AFR Average excl. AFR
15
.. but many challenges remain, especially governance
2006 2007 2008 2009 2010 20112.7
2.8
2.9
3.0
3.1
3.2
Public management & institutions
AFR Average excl. AFR
16
Africa’s economies are yet to transformExample: Kenya’s exports
0
10
20
30
40
50
60
70
80
90
25.2
Cambodia
38.0
68.3
Kenya Cambodia Thailand Vietnam
Exp
orts
as
% o
f GD
p
17
The need to deliver aid differently
18
The Old Reality of Aid
19
The New Reality of Aid
20
Since 1992, aid has doubled, mainly due to the emergence of new players
Total Development Assistance from OECD, 1992
Total Development Assistance from OECD, 2008
ODA 95%
NGOs5%
US$ 92 Bln
ODA 63%NGOs
27%
New Bilaterals
10%
US$ 194 Bln
21
The total number of projects has quadrupled while the average size declined sharply (ODA only)
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 20080
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
Average project size
Project count (right axis)
No
of
Pro
jec
ts
22
Aid engagements: Past
Fragile
Stable poor
MIC
HIC
Inte
nsity
of
eng
agem
ent
23
Aid engagements: 2025
Fragile
Stable poor
MIC
Inte
nsity
of
eng
agem
ent
HIC
24
Thank youWolfgang Fengler
wfengler@worldbank.orgTwitter: @wolfgangfengler