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International Monetary Fund. African Dept.

Abstract

Sub-Saharan Africa is struggling to navigate an unprecedented health and economic crisis—one that, in just a few months, has jeopardized decades of hard-won development gains and upended the lives and livelihoods of millions.

International Monetary Fund. African Dept.

Abstract

Sub-Saharan Africa is struggling to navigate an unprecedented health and economic crisis—one that, in just a few months, has jeopardized decades of hard-won development gains and upended the lives and livelihoods of millions.

Mr. Alun H. Thomas
Recent micro level data from East Africa is used to benchmark aggregate data and assess the role of agricultural inputs in explaining variation in crop yields on smallholding plots. Fertilizer, improved seeds, protection against erosion and pesticides improve crop yields in Rwanda and Ethiopia, but not Uganda, possibly associated with lack of use there. With all positive yield determinants in place, wheat and maize yields could increase fourfold. The data hints at the negative effect of climate change on yields and the benefits of accompanying measures to mitigate its adverse impact (access to finance and protection against erosion). The adverse effect of crop damage on yields varies between 12/13 percent (Rwanda, Uganda) to 36 percent (Ethiopia). Protection against erosion and investment financing mitigate these effects considerably.
Ms. Corinne C Delechat
,
Lama Kiyasseh
,
Ms. Margaux MacDonald
, and
Rui Xu
This study analyzes the drivers of the use of formal vs. informal financial services in emerging and developing countries using the 2017 Global FINDEX data. In particular, we investigate whether individuals’ choice of financial services correlates with macro-financial and macro-structural policies and conditions, in addition to individual and country characteristics. We start our analysis on middle and low-income countries, and then zoom in on sub-Saharan Africa, currently the region that most relies on informal financial services, and which has the largest uptake of mobile banking. We find robust evidence of an association between macroprudential policies and individuals’ choice of financial access after controlling for personal and country-level characteristics. In particular, macroprudential policies aimed at controlling credit supply seem to be associated with greater resort to informal financial services compared with formal, bank-based access. This highlights the importance for central bankers and financial sector regulators to consider the potential spillovers of monetary policy and financial stability measures on financial inclusion.
International Monetary Fund. African Dept.
This paper analyzes Uganda’s Request for Disbursement Under the Rapid Credit Facility. The Ugandan economy is severely affected by the coronavirus disease 2019 (COVID-19) pandemic. In order to contain the impact of the pandemic, the authorities have increased health spending, strengthened social protection to the most vulnerable, and enhanced their support to the private sector. The Bank of Uganda has appropriately reduced interest rates and provided liquidity to safeguard financial stability, while maintaining exchange rate flexibility. The weakening economic conditions emanating from the Covid-19 pandemic have put significant pressures on revenue collection, expenditure, reserves and the exchange rate, creating urgent large external and fiscal financing needs. The IMF continues to monitor Uganda’s situation closely and stands ready to provide policy advice and further support as needed. The authorities have also committed to put in place targeted transparency and accountability measures to ensure the appropriate use of emergency financing. The IMF’s emergency financial support under the RCF, along with the additional donor financing it is expected to help catalyze, will help address Uganda’s urgent balance of payments and budget support needs.
International Monetary Fund. African Dept.

Abstract

Sub-Saharan Africa is facing an unprecedented health and economic crisis that threatens to throw the region off its stride, reversing the encouraging development progress of recent years. Furthermore, by exacting a heavy human toll, upending livelihoods, and damaging business and government balance sheets, the crisis threatens to retard the region’s growth prospects in the years to come. Previous crises tended to impact affect countries in the region differentially, but no country will be spared this time.

International Monetary Fund. African Dept.

Abstract

To come when report is received.

International Monetary Fund. African Dept.
Selected Issues
International Monetary Fund. African Dept.
This Selected Issues paper investigates state-owned financial institutions’ (SOFIs) performance in developing economies. It focuses on Sub-Saharan Africa, zooming in on the Togolese experience with SOFIs and privatization, at a time when the Togolese government has decided to further disengage from the financial sector. Typically set up with a public interest and financial inclusion mandate, SOFIs tend to weaken financial stability and fiscal discipline in developing economies, especially if they are not typically regulated and supervised on the same basis as other banks. Togo’s and cross-country experiences suggest that performance improves more after privatization when the government fully relinquishes control, when banks are privatized to strategic investors rather than through share issues, and when bidding is open to all, including foreign banks. The success of privatization also hinges on the business environment for competition, governance, and entry, on banks’ valuation and how policy concerns are dealt with, as well as on owner’s prudential review quality.
The Spring-Summer 2019 issue of the IMF Research Perspectives explores how technology deals with old questions. Articles discuss the ways technological progress and the increased availability of data have helped in some areas, while presenting new challenges for analyzing various matters. The issue also includes an interview with Gita Gopinath, the new director of the IMF Research Department.