Presentation by Steve Radelet Chief Economist for USAID Median - PowerPoint PPT Presentation

Presentation by Steve Radelet Chief Economist for USAID

Median Real Income, Sub- Saharan Africa 390 370 350 (in constant 2000 USD) 330 310 290 270 250

Growth in GDP per capita,1996 - 2008 Emerging Countries Other Countries Oil Exporters Botswana 4.1 Burundi -0.8 Angola 7.6 Burkina Faso 2.8 Central African Republic -0.5 Cameroon 1.7 Cape Verde 4.0 Comoros -0.3 Chad 3.4 Ethiopia 4.1 Congo, Dem. Rep. -1.1 Congo, Rep. 1.3 Ghana 2.6 Cote d'Ivoire -0.9 Eq. Guinea 23.6 Lesotho 2.3 Djibouti -0.4 Gabon -0.7 Mali 2.5 Eritrea -1.7 Mauritania 1.1 Mauritius 3.7 Gambia, The 1.5 Nigeria 2.3 Mozambique 5.4 Guinea 1.7 Sudan 4.7 Namibia 2.4 Guinea-Bissau -2.3 Rwanda 3.7 Niger 0.6 Sao Tome and Principe 5.0 Madagascar 0.9 Seychelles 2.6 Somalia n.a. South Africa 2.0 Swaziland 1.9 Tanzania 3.0 Togo 0.2 Uganda 3.8 Zimbabwe -2.9 Zambia 1.8 Threshold Countries Benin 1.3 Kenya 2003-08 2.4 Liberia 2005-08 3.1 Malawi 1.2 Senegal 1.4 Sierra Leone 2003-08 3.7

Average Per Capita Income 160 Average GDP per capita (1977=100) 140 120 100 80 60 40 1960 1962 1964 1966 1968 1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 Emerging Oil-Exporters Other SSA

Growth in Per Capita Income 1961-1977 1978-1995 1996-2008 4.00 Average GDP per capita growth 3.00 2.00 1.00 0.00 -1.00 -2.00 Emerging Oil Exporters Other SSA

Gross Capital Formation, 1995=100 (Investment) Gross Capital Formation 100 150 200 250 300 50 0 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 1975 1976 Emerging 1977 1978 1979 1980 1981 1982 1983 1984 Other SSA 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

T otal Trade, 1995=100 100 150 200 250 300 350 50 0 Total Trade 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 Emerging 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 Other SSA 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Productivity Growth T otal Factor Productivity Growth in SSA (3 year rolling average) 3.0 2.0 Productivity growth (%) 1.0 0.0 -1.0 -2.0 -3.0 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Emerging Countries Other SSA

Constant USD, 1988=100 110 130 150 170 190 50 70 90 Agricultural Production 1970 1971 1972 1973 1974 1975 1976 1977 1978 Other SSA 1979 1980 1981 1982 1983 1984 1985 1986 Oil-Exporters 1987 1988 1989 1990 1991 1992 1993 1994 Emerging 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Infant Mortality 120 110 Infant Mortality Rate (per 1,000 live births) 100 90 80 70 60 1980 1985 1990 1995 2000 2005 Emerging Oil-Exporters Other SSA

Primary School Enrollment 85 80 Net Primary Enrollment (%) 75 70 65 60 55 50 1999 2001 2003 2005 2007 Emerging Not Emerging Oil-Exporters

Population Growth Rate 4.00% 3.50% 3.00% Population Growth Rate 2.50% 2.00% 1.50% 1.00% 0.50% 0.00% 1962 1966 1970 1974 1978 1982 1986 1990 1994 1998 2002 2006 Emerging Oil-Exporters Other SSA

Poverty Rates in the Emerging African Countries Share of population with incomes less than $1.25/day 70 60 Percent Below the Poverty Line 50 40 30 20 10 0 1981 1993 2005

Changes in Commodity Prices 200 180 160 erms of Trade (2000=100) 140 120 100 80 T 60 40 1980 1985 1990 1995 2000 2005 Emerging Oil-Exporters Other SSA

Five Fundamental Changes 1. The Rise of Democracy and Improved Governance 2. Stronger Economic Policies 3. The End of the Debt Crisis and Improved Donor Relations 4. The Rise of New T echnologies 5. The Emergence of a New Generation

Major Changes in the Emerging Countries: Economic Policy Reform, Political Change, and Per Capita Income 20 15 Policy Reform: Number of 10 Anti-Growth 5 Syndromes 0 1 2 Democracy: 3 Political Rights 4 and Civil Liberties 5 6 160 7 140 Economic 120 Performance: 100 Income per capita 80 (1977=100) 60 1960 1962 1964 1966 1968 1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008

African Democracies 30 25 Number of Democracies 20 15 10 5 0 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010

Freedom House Scores Average of Political Rights and Civil Liberties Scores 1 2 Freedom House Scores 3 4 5 6 7 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 Emerging countries Other SSA

Freedom House and Polity IV Scores Freedom House Polity IV Score 7 = worst score -10 = worst score 1 = best score +10 = best score Emerging Countries 1989 2008 1989 2008 Botswana 1.5 2 7 8 Burkina Faso 5.5 4 -7 0 Cape Verde 5.5 1 N/A N/A Ethiopia 7 5 -8 1 Ghana 5.5 1.5 -7 8 Lesotho 5.5 2.5 -7 8 Mali 6 2.5 -7 6 Mauritius 2 1.5 10 10 Mozambique 6.5 3 -7 6 Namibia 3.5 2 6* 6 Rwanda 6 5.5 -7 -3 Sao Tome and Principe 5.5 2 N/A N/A Seychelles 6 3 N/A N/A South Africa 5.5 2 4 9 Tanzania 6 3.5 -6 -1 Uganda 5 4.5 -7 -1 Zambia 5.5 3 -9 7 Threshold Countries Benin 7 2 -7 7 Kenya 6 3.5 -6 6 Liberia 5.5 3.5 -6 6 Malawi 6.5 4 -9 6 Senegal 3.5 3 -1 8 Sierra Leone 5.5 3 -7 7

Incidence of Domestic Conflict Average number of incidents per year per country group 30 26 25 21 20 20 15 12 10 9 5 5 0 Emerging Non-emerging Oil exporters 1980-1995 1996-2008

African Leaders Departure From Power Source: Daniel N. Posner and Daniel J. Young, 2007, “The Institutionalization of Political Power in Africa,” Journal of Democracy 18 -3 (July), pp. 128.

Governance Indicators Source: World Bank Institute Rule of Law Regulatory Quality Year Emerging Non-emerging Emerging Non-emerging 1996 -0.47 -0.77 -0.49 -0.64 2008 -0.24 -0.99 -0.25 -1.01 Government Effectiveness Political Stability Emerging Non-emerging Emerging Non-emerging 1996 -0.46 -0.71 -0.39 -0.40 2008 -0.29 -1.10 0.01 -0.84 Control of Corruption Voice & Accountability Emerging Non-emerging Emerging Non-emerging 1996 -0.49 -0.55 -0.10 -0.69 2008 -0.15 -0.80 0.03 -1.19

2. Stronger Economic Policies Prevalence of “Anti - Growth Syndromes” 25 20 number of syndromes 15 10 5 0 Emerging Oil Exporters Other SSA

Currency Overvaluation: The Real Exchange Rate 450 400 350 Real Exchange Rate (2000=100) 300 250 200 150 100 50 0 1970197219741976197819801982198419861988199019921994199619982000200220042006 Emerging Oil-Exporters Other SSA

Average Import Tariff Rates 30.0 26.6 25.0 25.0 22.2 19.2 20.0 18.7 17.4 15.8 15.4 15.0 11.4 10.0 5.0 0.0 Emerging Oil-Exporters Other SSA 1981-1995 1996-2003 2004-2007

Changes in Agricultural Policies: The Nominal Rate of Assistance 0 otal Agriculture) -0.02 -0.04 -0.06 Nominal Rate of Assistance (T -0.08 -0.1 -0.12 -0.14 -0.16 -0.18 -0.2 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Emerging Other SSA

Costs of Starting a Business 400% 350% 300% % of income per capita 250% 200% 150% 100% 50% 0% Emerging Oil-Exporters Other SSA 2003 2009

3. The End of the Debt Crisis and Change in Donor Relationships 1000% 900% External Debt/Exports 800% 700% 600% 500% 400% 300% 200% 100% 0% 1970 1975 1980 1985 1990 1995 2000 2005 Emerging Oil-Exporters Other SSA

Official Financing for the Emerging African Countries 12000 10000 in constant 2008 USD, millions 8000 6000 4000 2000 0 1988 1998 2008 Non-Concessional Loans Concessional Loans Grants

4. The rise of new T echnologies: Mobile Subscriptions (per 100 people) 40 35 30 25 20 15 10 5 0 2000 2007 Emerging Oil Exporting Other SSA

Internet Subscriptions (per 100 people) 9 8 7 6 5 4 3 2 1 0 2000 2007 Emerging Oil Exporting Other SSA

5. The Emergence of a New Generation