Economics

Study Notes

Sub Saharan Africa Development Report 2018

Level:: AS, A-Level, IB

Board:: AQA, Edexcel, OCR, IB, Eduqas, WJEC

Last updated 21 May 2018

Here is a selection of tweets drawing on my reading of the 2018 IMF Report on Sub Saharan Africa. James hall (All About Africa) is also superb to follow for contextual examples.

Development Context: Sub- Saharan Africa has historically the lowest level of private investment as a share of GDP among regions with similar levels of development - what are the main barriers holding back domestic and inward private sector development? #econ4
— Tutor2u Geoff (FRSA) (@tutor2uGeoff) May 20, 2018

IMF (2018) Egypt, Indonesia, Sri Lanka, Morocco, Philippines, Thailand, & Vietnam have all managed to grow from low-income to middle-income status without sizeable commodity exports. Can many Sub Saharan countries do the same? Vietnam now 24th largest global exporter. pic.twitter.com/iqWgRBvyVI
— Tutor2u Geoff (FRSA) (@tutor2uGeoff) May 20, 2018

Will robotics hold back growth & development in SSA? IMF (2018): "The rapid robotization of manufacturing and the risk of a wave of inward- looking policies may make it more difficult for sub-Saharan African countries to compete in manufacturing."
— Tutor2u Geoff (FRSA) (@tutor2uGeoff) May 20, 2018

Trade:
Low intra-industry trade: In 2016, only 18% of Africa’s trade conducted within the continent
Low complexity: Manufactured goods were only 19% of Africa’s exports to rest of the world
High tariffs: Tariffs & non-tariff barriers remain high; SSA average -14.5%
— Tutor2u Geoff (FRSA) (@tutor2uGeoff) May 20, 2018

Counter-intuitive for some students - increasing tax revenues as share of GDP widely regarded as essential for inclusive/sustainable development. Since the mid-1990s, 15 SSA countries have lifted tax-to-GDP ratios >13% - min ratio seen as pre-condition for growth & development
— Tutor2u Geoff (FRSA) (@tutor2uGeoff) May 20, 2018

Median revenue-to-GDP ratio among all emerging market and developing economies is 23 percent, 5 percentage points higher than for sub-Saharan Africa. Taxes help pay for public & merit goods and finance basic welfare provision.
— Tutor2u Geoff (FRSA) (@tutor2uGeoff) May 20, 2018

IMF argue that VAT is more growth friendly than other types of taxes, especially direct taxes (IMF 2015a) especially as an emerging middle class increases per capita spending, but distributional impacts need addressing
— Tutor2u Geoff (FRSA) (@tutor2uGeoff) May 20, 2018

The composition of wealth fundamentally changes with economic development, as countries transition from a reliance on natural capital to investing in human capital https://t.co/UkdCZjMvJE pic.twitter.com/nzuL5FRy38
— World Bank Poverty (@WBG_Poverty) May 20, 2018