Building Integrated Economies in West Africa
Back Matter

Back Matter

Author(s):
Alexei Kireyev
Published Date:
April 2016
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Index

Note: Page numbers followed by b indicate box, f figure, and t table.

A

  • Agence UMOA-Titres. See WAEMU Securities Agency
  • Agricultural sector
    • export quality, 69
    • growth trends, 68, 69f
    • insurance, 291, 292f
    • Mali’s, growth inclusiveness and, 90–92
    • policies to improve trade competitiveness, 76–77b
    • policies to promote inclusive growth, 98–99
    • policies to reduce vulnerability to shocks, 3
    • poverty reduction through regional integration of, 361, 362–363
    • productivity, 76b
    • rationale for structural reforms, 28–29, 70
    • regional integration, 361–362
    • regional policy coordination, 363
    • structural reforms to promote growth, 29, 44, 74, 75–77b
    • trade patterns, 77b
    • trade restrictions, 362
  • Alcohol taxes, 167, 168, 174
  • Asymmetric macroeconomic shocks
    • current shock-smoothing mechanism, 124f
    • definition, 44
    • fiscal federalism rationale, 141
    • fiscal rule cyclicality and, 114
    • frequency, 122
    • policy response, 57
    • rationale for coordinated fiscal policy response, 44
    • regional risk-sharing mechanism, 122, 141–142, 143
    • regional stabilization mechanism, 122, 124f
    • supply shock convergence, 60, 61f
    • synchronization in WAEMU, 135, 136t
  • ATMs, 287, 288f

B

  • Bailouts, 57
  • Banking sector
    • access, 7–8, 98, 256, 287–291, 288f, 289f, 309
    • asset concentration, 276f
    • barriers to entry, 240
    • capital adequacy ratios, 27f, 263f, 265
    • capital concentration risk, 303
    • Central Bank oversight, 22
    • competition in, 273
    • contract enforcement, 284–286
    • cross-border flows, 260–262
    • current commercial bank deposits, 256
    • current liquidity positions, 24, 25
    • current structural characteristics, 7, 256, 260–262, 261f
    • deposit and payment modes, 287–291, 290f
    • distribution of excess liquidity, 206
    • foreign assets, 205
    • foreign ownership, 256
    • government securities holdings, 235, 236f, 240
    • liquidity-associated risks, 235
    • microfinance institutions, 8, 256, 259, 265, 266f, 271
    • mobile market, 8–9, 257–258, 302
    • nonperforming loans, 263f, 303
    • prudential standards compliance, 13
    • regional groups, 9, 25, 257, 260, 261f, 301, 304
    • regional integration prospects, 364
    • reserve requirements, 207–208, 208t, 305–306
    • reserves, 205–206, 205f, 206f, 206t, 208f
    • resolution framework, 8, 257, 301, 306–308, 307t
    • return on assets, 277, 279f
    • return on equity, 277, 279f
    • soundness, 262–265, 262b, 263f, 264t
    • supervision, 2, 7, 8, 22, 28
    • WAEMU objectives, 256
    • See also Financial sector; Liquidity injections, BCEAO; Prudential standards
  • Basel II/III standards, 7, 8, 28, 256, 257, 304
  • BCEAO. See Central Bank of West African States
  • Benin
    • bank reserve requirements, 207
    • financial sector depth, 273
    • foreign aid flows to, 48
    • growth benefits of infrastructure investment, 147
    • inflation in, 221
    • interest rates, 221, 232
    • microfinance institutions in, 265
    • public spending, 155
    • shock effects in, trade flows and, 336
    • tax revenue, 150, 152, 166, 175, 181–182
    • total factor productivity, 49
    • trade, 322, 324, 326, 328–329, 332, 334, 336, 344–346b
    • See also WAEMU
  • Bond markets
    • constraints to regional financing, 110–111
    • current efforts to develop, 28, 103–104
    • investor guarantees, 302
    • ratings, 302
    • See also Securities market, WAEMU
  • Bourse Régionale des Valeurs Mobiliéres, 266–269, 270f, 275, 303
  • Burkina Faso
    • bank reserve requirements, 207
    • business cycle synchronization, 59
    • foreign aid flows to, 48
    • growth, 47
    • inflation in, 221, 242
    • interest rates, 232
    • tax revenue, 152, 175, 181
    • total factor productivity, 49
    • trade, 165, 322, 324, 326, 328–329, 332, 334, 336, 337, 341, 359
    • See also WAEMU
  • Business climate, 29, 301
    • current environment, 52f
    • growth and, 51, 53, 67–68, 68f
    • right to establishment in WAEMU, 367
  • Business cycle synchronization, 59, 59t, 271

C

  • Cape Verde, 318
  • Capital income taxation, 164
  • Capital markets, 52
    • regulatory control, 200–201
    • in trilemma conditions, 199
  • Central African Economic and Monetary Community (CEMAC), 12, 358, 363, 364t
  • Central Bank of West African States (BCEAO), 2, 16
    • banking sector supervision, 22
    • commercial bank borrowing, 6–7, 24, 27f
    • control of capital transactions, 200–201
    • correlation of reserve money and net foreign assets, 202
    • effectiveness of inflation control policies, 197–198, 211–214, 213t, 241–243
    • effectiveness of monetary policy, 196–197, 199, 211, 214
    • effectiveness of monetary policy transmission through interest rates, 227–233, 229–231t
    • emergency liquidity assistance from, 306
    • euro area policy rates and, 201, 202t, 215–218, 216f, 217t
    • foreign assets, 196
    • future of fiscal-monetary policy coordination, 13, 31
    • indicators of monetary policy independence, 201–203
    • inflation control policies, 6, 7, 241
    • interest rate policy, 204–205, 204b, 219–221
    • monetary policy challenges and opportunities, 5–7
    • Monetary Policy Committee, 22, 33, 196, 200, 219
    • monetary policy framework, 200
    • monetary policy objectives, 21, 196
    • monetary policy transmission mechanisms, 6, 62, 196–197, 199, 203, 208–210, 209f
    • refinancing operations, 24
    • in regional securities market, 102–103, 112
    • reserves coverage, 24, 200
    • reserves policy, 12, 207–208, 208t
    • responsibilities and authorities, 1, 12, 18b, 21–22, 33, 37
    • role in fiscal-monetary policy coordination with Ministries of Finance, 38–40, 41–42
    • structure, 21
    • See also Liquidity injections, BCEAO
  • Central Deposit and Settlement Organization, 102, 103
  • Child mortality, 78f, 155
  • China, 59, 60t
  • Common external tariff, 15, 153, 165, 180, 319
    • adoption, 164, 341
    • macroeconomic implications, 9–10, 341, 348, 348t, 349f
    • objectives, 29
    • potential trade outcomes, 341, 344–346, 347f
    • rates, 357
    • regional trade integration and, 9–10, 358
    • revenue implications, 10, 179, 341, 342f, 346–348, 347f
    • structure, 29, 164–165, 343, 343t
  • Communauté Financière Africaine (CAF), 12, 16f, 200, 201
  • Community solidarity levy, 360–361
  • Conférence Interafricaine de la Prévoyance Sociale, 302
  • Conference of Heads of State and Government, 15, 16, 18b, 20
  • Corporate income taxes, 169–171, 175, 176t, 179, 180–181, 181f, 184
  • Corruption, 51
  • Côte d’Ivoire
    • bank reserve requirements, 207
    • consumption patterns, 24
    • credit market, 284–286
    • inflation in, 242
    • interest rates, 221, 232
    • migration patterns, 367
    • regional trade, 9
    • shock effects in, trade flows and, 336–337, 340
    • social stability, 370
    • tax revenue, 150, 152, 180
    • total factor productivity, 49
    • trade, 165, 318, 321, 322, 324, 326, 327, 329, 332–334, 336, 358
    • See also WAEMU
  • Council of Ministers, 16, 17, 18b, 33, 41
  • Court of Auditors, 17, 18b
  • Court of Justice, 17, 18b
  • Credit markets
    • access, 256, 283, 296
    • current characteristics, 260, 261f
    • deposit and payment modes, 287–291, 290f
    • depth of WAEMU financial sector, 277, 278f, 284–286
    • effectiveness of BCEAO inflation control policies, 197–198, 249–249
    • information on borrowers, 283, 284–286, 301
    • loans to firms, 291, 293f, 296
    • microfinance institutions in, 259
    • private sector credit gaps, 291, 294f
    • private use of loans, 292f
    • regional market characteristics, 266–269
    • transmission of monetary policy through, 62, 209–210
  • Credit-to-GDP ratios, 7–8, 291, 294f
  • Current account, 318
    • financing sources, 26f
    • future prospects, 25, 26f
    • patterns and trends, 2, 23, 24, 48–49, 50f, 238
  • Customs duties, 20, 164–166, 361

D

  • Debt-to-GDP ratio, 17–19, 23, 127–128, 273–275
  • Deficit bias, 117, 118f
  • Demographic trends, 74–80, 78f
    • access to financial services, 287, 289f
    • mobile banking use, 312f
  • Dependency ratio, 79b
  • Deposit insurance, 8, 308

E

  • Ebola, 23, 25
  • Economic Community of Western African States (ECOWAS), 318
    • common external tariff, 9–10, 15, 29, 357
    • WAEMU trade patterns, 341–342, 342f
  • Economic Partnership Agreements, 179, 357
  • Education, 67–68, 291, 292f
    • gender inequality outcomes in, 93
    • for poverty reduction, 369
    • public spending efficiency, 155, 156, 156f, 157t
  • Employment
    • demographic trends and, 74–77, 79f, 80
    • gender participation, 92, 93f
    • labor market reforms to promote inclusive growth, 98
    • sectoral distribution, 75b
  • Energy infrastructure, 368
  • Equity markets, 211, 269, 302
  • Euro area
    • cointegration of WAEMU interest rates with, 203, 215–218, 216f, 217t
    • fiscal balance criterion, 130
    • inflation in WAEMU and, 203, 251
    • policy rates, 201, 202t
    • WAEMU business cycle synchronization, 59, 60t
  • European Central Bank, 201, 202t
  • Excess Deficit Procedure, 131
  • Exchange rates
    • BCEAO resources for defense of, 200
    • as constraint to dealing with macroeconomic shocks, 57
    • constraints to fiscal and monetary policy, 35
    • historical adjustments, 12
    • international reserves and, 24
    • patterns and trends, 50
    • policy challenges and opportunities, 6
    • role of monetary policy in fixed rate systems, 196, 199
    • transmission of monetary policy through, 210
    • WAEMU policy, 1, 12, 318
  • Excise taxes, 167–169, 168t, 174–175, 174t

F

  • Fertility rates, 74–77, 78f, 80
  • Financial sector
    • access, 7–8, 98, 256, 257, 275, 276f, 277, 287–291, 288f, 289f, 293f, 309, 366
    • central bank borrowing, 6–7, 24, 27f
    • constraints to inclusion, 296
    • cost of financing, 52
    • crisis prevention, 8, 257, 301, 305, 306–308
    • current efforts to deepen, 28
    • current level of development, 273–277, 274f, 276f
    • current structure, 7, 256, 257, 259–260
    • data collection and dissemination needs, 303, 304, 305
    • determinants of depth, 277–286
    • determinants of financial inclusiveness gaps, 291, 295f
    • future challenges and opportunities for WAEMU, 1, 25–28
    • growth benefits from development of, 365–366, 366f
    • international comparison of development in, 257, 273, 275f, 277, 279–283, 282t
    • liquidity provisions, 6
    • obstacles to growth and development, 52–53, 301
    • poverty reduction through regional integration of, 364–366, 366f
    • rationale for deepening, 128
    • regional and national coordination, 303
    • regional groups, 101
    • regional markets, 266–269
    • resources for financing growth, 3–4, 45, 101, 111–112
    • risk management, 25–28, 269–271
    • stability, 271
    • strategies to improve access, 257, 296, 297–299f, 302–303, 309
    • strategies to promote foreign investment, 10
    • strategies to promote inclusive growth, 98
    • strategies to promote market discipline, 128–130
    • strategies to promote stability and growth, 7–9, 302–303
    • structural trends, 256, 259
    • transmission of monetary policy through, 210–211, 224, 234
    • See also Banking sector; Regulation and supervision, financial sector
  • Financial Stability Board, 306–308
  • Financial Stability Committee, 196, 271
  • Financial Stability Council, 305
  • Financial Stability Fund, 308, 353
  • Fiscal balances
    • causes of deficits, 237–238
    • convergence criteria, 130
    • convergence criteria compliance, 117, 118f, 127–128
    • cyclical flexibility of fiscal rules for, 140–141
    • exclusion of foreign-financed expenditures, 130, 139–140
    • fiscal-monetary policy coordination on, 37–38
    • future prospects, 4, 13, 25, 26f, 38
    • inflation and, 251
    • patterns and trends, 2, 23–24, 26f, 39f, 130f, 237–238, 237f
    • procyclicality of fiscal policy and, 136–139
    • projections, 38
  • Fiscal consolidation, 240
    • future challenges and opportunities, 2, 4, 13
    • projections, 38
    • rationale, 23
  • Fiscal councils, 118f, 121–122
  • Fiscal-monetary policy coordination, 2, 13
    • BCEAO independence and, 36–37
    • current institutional framework for, 33, 41
    • current status, 41
    • implementation challenges, 32
    • implementation efforts to date, 31, 32
    • key areas of, 37–38, 38f
    • mutual effects of macroeconomic policies, 36, 36f
    • objectives, 33–34, 34f
    • rationale, 13, 31
    • recommendations for, 41–42
    • relations between BCEAO and Ministries of Finance in, 38–40, 40f
    • statutory provisions, 32–33, 32b
    • strategies for implementation, 31
    • types of instruments for, 34–35
  • Fiscal policy
    • achieving market discipline in absence of central fiscal authority, 125
    • constraints to, 35
    • convergence criteria, 4, 15, 17–19, 117, 119, 127, 129t
    • convergence criteria compliance, 19, 19t, 127–128
    • countercyclical rules, 114, 120–121
    • current institutional structure for, 37–38, 37f, 114
    • cyclical effects of fiscal rules, 139–140
    • cyclical patterns, 136–139, 137t, 138t
    • definition and scope, 114
    • design of regional rules, 125
    • effectiveness of current regional rules, 117
    • federalism, 141, 143
    • future challenges and opportunities, 4–5
    • as impediment to growth, 120
    • monetary policy overlap and interactions, 31–32, 36–37, 36f, 38–40
    • objectives, 31, 33–34
    • obstacle to addressing shocks, 57
    • opportunities for improving fiscal rules and compliance, 119–120
    • to reduce impact of macroeconomic shocks, 44, 57
    • regional coordination, 40, 57, 114
    • regional market discipline and, 114
    • regional risk-sharing, 122, 134, 141–142, 143
    • regional surveillance, 114
    • risk management, 4–5
    • role of regional rules, 125
    • rule flexibility, 120–121
    • significance of, for maintaining stability in WAEMU, 114, 117
    • strategies for promoting regional rule compliance, 121–122
    • time scale, 35
    • tools of, 31, 34
    • See also Fiscal-monetary policy coordination; Fiscal rules
  • Fiscal rules
    • budget deficit, 134
    • considerations for future revision of, 119–120
    • convergence criteria and, 117, 127
    • current compliance, 117, 120, 127–128
    • current effectiveness, 114, 117
    • design, 125
    • effects on cyclicality of fiscal policy, 136, 138, 139–140
    • flexibility rationale, 120–121, 142
    • to mitigate shock risk, 133, 134
    • options for allowing cyclical flexibility, 140–141
    • procyclicality of public investment and, 114, 134, 142
    • public debt ceiling, 130
    • quality of fiscal policy and, 134
    • rationale, 4, 114, 117, 125, 133–134, 142
    • role of fiscal councils in promoting adherence to, 121–122
    • strategies for promoting compliance, 120, 121
  • Fiscal space
    • challenges for WAEMU, 147
    • opportunities for enlarging, 147
    • to promote sustainable growth, 5, 115
    • raising tax revenue to enlarge, 148–153
    • for scaling up public investment, 147
    • tax coordination to create, 115
  • Foreign aid
    • cyclicality, 142
    • debt relief, 147
    • patterns and trends, 48, 49f
  • Foreign investment
    • bank ownership, 256
    • communication issues constraining, 353–354, 355
    • current state, 319
    • in government debt. See Foreign ownership of government debt
    • patterns and trends, 48, 49f
    • recommendations for regulation, 8
    • strategies to promote, 10, 319
    • WAEMU control of capital transactions, 200–201
  • Foreign ownership of government debt
    • benefits to governments, 355
    • current, 351
    • impediments to, 351, 352–355
    • strategies for encouraging, 351, 355–356
  • France, 12, 200

G

  • Gambia, 318
  • Gender inequality, 67f
    • growth and, 45, 93–94, 94f, 95–97f, 99
    • labor force participation, 92, 93f
    • trends, 92, 93f
  • Ghana, 242, 257, 273, 277, 318
    • government debt market, 351, 352f, 353
  • Gini coefficient, 85
  • Goods and services taxes, 148, 149, 152, 154f, 160t, 167
  • Governance
    • constraints to private investment, 53, 301
    • current institutional quality, 51, 52f
    • depth of financial sector and, 278–279, 281–283
    • quality of, growth and, 51, 54
  • Growth
    • benefits of infrastructure investment, 147
    • benefits of WAEMU membership, 369
    • causes of divergence within Africa, 44, 47
    • causes of WAEMU underperformance, 52–54
    • constraints to regional financing, 110–111
    • demographic factors, 74–80
    • determinants of, 47–51, 65–68, 148f
    • differences within Africa, 44, 47, 48f, 65
    • effects of macroeconomic shocks, 44
    • emerging threats, 25
    • export diversification to promote, 44, 70–74, 73f
    • financial sector development and, 283–284, 365
    • financing challenges, 3–4
    • fiscal deficit and, 118f, 120
    • fiscal policy as impediment to, 120
    • future prospects, 25, 26f
    • gender inequality and, 45, 93–94, 94f, 95–97f, 99
    • income distribution, 83–84, 92
    • inflation and, 364
    • international comparison of low- and middle-income countries, 135, 135t
    • in Mali, 87
    • monetary policy objectives, 196
    • obstacles to, in WAEMU, 44
    • policy recommendations to sustain, 2–4, 30
    • possible effects of common external tariff, 341
    • poverty reduction and, 83, 84f, 97–98
    • public investment and, 135, 135t, 137
    • resources for financing, 3–4, 45, 101, 111–112
    • sectoral distribution, 68, 69f
    • social conflict and, 370
    • structural transformation and, 44
    • in Sub-Saharan countries, 44, 135
    • trade integration and, 359–360
    • trends and patterns, 2, 23, 24t, 26f, 30, 44, 47, 48f, 65, 66f, 360
    • variation within WAEMU, 135
    • volatility, 135
    • See also Inclusive growth
  • Growth incidence curve
    • Mali’s, 87–90, 89f
    • Senegal’s, 86–87, 88f
  • Guinea-Bissau, 59, 318, 332, 334
    • bank reserve requirements, 207
    • financial sector depth, 273
    • foreign aid flows to, 48
    • interest rates, 221, 232
    • shock effects in, trade flows and, 336, 337
    • tax revenue, 152, 175, 181
    • total factor productivity, 49
    • trade, 165, 322, 324, 326, 328, 329, 336, 337, 341–342
    • See also WAEMU

H

  • Health community policies, 368–369
  • Health spending, 155–156, 157f, 158t, 291, 292f
  • Hirsh index, 322
  • Human capital accumulation, 65–67

I

  • Inclusive growth
    • current status, 7–8
    • definition, 84
    • future challenges and opportunities, 8–9
    • institutional support for, 98
    • in Mali, 87–94, 89f
    • measurement, 84–85
    • rationale, 3, 94–98
    • regional integration and, 357
    • in Senegal, 85–87
    • strategies for promoting, 45, 81, 98–99
    • trends, 81
  • Income
    • financial sector development and, 283–284
    • trends, 44, 65
  • Income distribution
    • future challenges and opportunities, 3
    • growth and, 45, 83–84, 92
    • measurement, 84–85
    • patterns in Senegal, 85, 85t
    • socio-political outcomes, 92
    • trends, 81
    • See also Inclusive growth; Poverty reduction
  • Income tax, 148, 149, 152, 154f, 160t
    • corporate, 169–171, 175, 179, 180–181, 181f, 184
    • portfolio income, 171, 171t, 173, 175–176
  • Inflation
    • asymmetric transmission of monetary policy within WAEMU, 219, 221
    • BCEAO objectives, 241
    • BCEAO’s calculation of, 221
    • effectiveness of BCEAO policies, 197–198, 241–243
    • effectiveness of interest rate policies in controlling, 225–226, 241, 242, 244, 244f, 249
    • fiscal deficit and, 251
    • fiscal-monetary policy coordination, 13, 39, 40, 41–42
    • forecasting, 200
    • future policy challenges and opportunities, 2, 6, 7, 25, 26f
    • growth and, 364
    • imported, 251
    • influence of economic variables and policies on, 246–251
    • intra-African comparison, 363, 364t
    • modeling of monetary policy determinants, 244–246
    • modeling of monetary policy transmission, 226–227
    • monetary policy objectives, 196, 221
    • output gap and, 249–251, 249f
    • poverty outcomes, 363–364
    • public debt and, 197–198
    • terms of trade and, 26f
    • transmission of cental bank monetary policies to control, 6
    • trends and patterns, 2, 23, 48, 50f, 220f, 221, 243, 243f, 363, 364t
    • volatility, 363
    • WAEMU and euro area, 203, 251
    • WAEMU target levels, 364
  • Inflation expectations, 210
  • Infrastructure investment
    • financial depth and, 283
    • future challenges and opportunities, 2, 13, 23
    • growth and, 23, 147
    • poverty reduction and, 10, 368
    • shortcomings in WAEMU, 135
    • for structural reform, 29
    • transportation, 362
  • Insurance market, 274f, 275, 276f, 291, 292f
  • Interbank market, 199, 203
    • current characteristics, 206–207, 211, 227–228, 239f, 259, 260t, 266, 267f
    • lending rates, 204–205, 219–221, 266, 267f
    • obstacles to further development, 239
    • strategies for development of, 302
  • Interest rates
    • asymmetric transmission of monetary policy within WAEMU, 219, 221, 227–233, 229–231t
    • cointegration of euro area and WAEMU, 203, 215–218, 216f, 217t
    • determinants of, 45, 127, 128t
    • effectiveness of BCEAO inflation control policies, 197–198, 211–213, 213t, 241, 242, 244, 244f, 251
    • euro area policy rates vs. WAEMU, 201, 202t
    • fiscal policy coordination in WAEMU, 4
    • government debt market, 351, 352
    • liquidity injections to control, 205, 206–207
    • modeling of monetary policy transmission, 226–227
    • monetary policy, 204–205, 204b
    • patterns and trends, 220f, 221, 222f, 223f, 238f, 268f
    • policy challenges and opportunities, 6
    • rate setting in BCEAO, 219–221
    • regional control, 196
    • securities market, 106–110
    • transmission of monetary policy through, 62, 210, 224–226, 225f, 228t
  • Intermediation rules, 311
  • International Finance Corporation, 103, 104, 111
  • International Financial Reporting Standards, 7
  • Internet coverage, 283
  • Investment codes, 164, 176–179, 178t, 184

K

  • Kenya, 257, 273, 277, 311
  • Kola bonds and bills, 103, 104, 111

L

  • Legal system, 1–2, 281–283
    • contract enforcement, 284–286
    • regional integration, 367
  • Liberia, 318
  • Life expectancy, 155
  • Liquidity injections, BCEAO
    • associated risks, 197, 207, 235, 238–239
    • to control interbank interest rates, 205, 206–207
    • crisis management, 306
    • as obstacle to development of interbank market, 207
    • as percentage of commercial bank reserves, 205–206, 206f, 206t
    • rationale, 205, 207
    • risk prevention, 197, 235, 239–240
    • transmission of monetary policy through, 210–211, 214
    • trends, 235–238, 236f
  • Liquidity requirements, 6, 25
  • Literacy rates, 92, 93f

M

  • Macroeconomic performance
    • convergence criteria to promote, 4
    • depth of financial sector and, 278, 281
    • effects of common external tariff, 348, 348t, 349f
    • instability evolution, 360, 361t
    • trends and patterns, 2
  • Macroeconomic policy
    • financial sector development and, 284
    • to promote foreign investment, 10
    • to reduce vulnerability to shocks, 2–3
  • Macroeconomic shocks
    • centralized fiscal smoothing mechanism, 122, 124f
    • convergence, 60, 60b, 61f
    • current shock-smoothing mechanism, 124f
    • diffusion in trade network, 337–339
    • effective smoothing mechanisms, 62–64, 62f
    • effects on growth, 44, 47–48, 57
    • policy response options, 44, 57
    • public investment response, 138–139, 139t, 142
    • regional fiscal risk-sharing, 122, 133, 134, 141–142, 143
    • regional integration to reduce vulnerability to, 369
    • significance of, for WAEMU, 57
    • WAEMU vulnerabilities to, 58f, 59
    • See also Asymmetric macroeconomic shocks
  • Macroprudential regulation, 304–306
  • Mali, 332, 334
    • agricultural sector, 90–92
    • bank reserve requirements, 207
    • business cycle synchronization, 59
    • consumption patterns, 90, 90t
    • foreign direct investment, 48
    • growth incidence curve, 87–90, 89f
    • growth patterns, 87
    • inclusive growth in, 87–94, 89f
    • inflation in, 221, 242
    • interest rates, 232
    • poverty reduction in, 87, 90, 91f
    • sectoral distribution of growth, 92
    • shock effects in, trade flows and, 336, 337, 340
    • tax revenue, 152, 181
    • total factor productivity, 49
    • trade, 322, 324, 326, 327, 329, 336, 341
    • urban–rural differences, 90
    • See also WAEMU
  • Manufacturing sector
    • export growth, 51f
    • export quality, 69
    • growth trends, 68, 69f
    • Mali’s, 92
    • policies to reduce vulnerability to shocks, 3
    • share of GDP, 51f
    • structural reforms to promote growth, 44, 70
  • Microfinance institutions, 8, 256, 259, 265, 266f, 271, 275, 276f
  • Microprudential regulation, 8, 257, 301, 303–304, 305t
  • Migration flows, 367
  • Mining, 164, 170, 177
  • Mobile banking, 8–9, 257–258, 302
    • benefits of, 309
    • costs, 311, 313f
    • current market, 309, 310f, 315f
    • demographic patterns in, 312f
    • growth of, 309, 310–311, 310f
    • interoperability, 311
    • obstacles to, 309, 311
    • oversight, 311–314
    • strategies for promoting, 309–310, 314
    • transaction insurance, 314
  • Monetary policy
    • asymmetric transmission within WAEMU, 219, 221, 227–233, 229–231t
    • constraints to, 35, 214
    • current institutional structure for, 37–38, 37f
    • effective shock-smoothing mechanisms, 62–64, 62f
    • effectiveness of inflation control policies, 211– 214, 213t, 241–243
    • effectiveness of interest rate channel for transmitting, 224–226
    • effectiveness of transmission mechanisms, 196–197, 199
    • fiscal policy overlap and interactions, 31–32, 36–37, 36f
    • in fixed exchange rate regime, 196, 199
    • future challenges and opportunities, 1, 5–7, 214
    • institutional framework, 196
    • interest rate adjustments, 204–205, 204b
    • limitations of WAEMU’s, 196
    • macroeconomic framework, 200
    • measures of independence, 201–203
    • modeling of transmission dynamics, 226–227
    • multilateral surveillance, 19–20
    • objectives, 21, 31, 34, 196
    • poverty reduction through regional integration of, 363–364
    • recent patterns and trends, 24
    • to reduce impact of macroeconomic shocks, 57
    • refinancing rate, 24
    • regional integration, 6
    • reserve requirements, 207–208, 208t
    • response to macroeconomic shocks, 62
    • strategies for improving transmission of, 234
    • time scale, 35
    • tools of, 31, 34–35
    • transmission mechanisms, 6, 62, 203, 208–210, 209f, 224, 225f
    • transmission through financial markets, 210–211
    • in trilemma conditions, 199
    • WAEMU administrative structure, 21–22
    • See also Fiscal-monetary policy coordination
  • Monetary Policy Committee, 22, 33, 196, 200, 219
  • Monetary unions, generally
    • in franc zone, 12
    • member’s capacity to respond to shocks, 133
    • rationale, 133
    • role of fiscal rules in, 133–134
  • Money supply, inflation and, 242, 243, 243f, 249–249
  • Morocco, 260
  • Mortality risk, 92, 93f
  • Mortgage refinancing, 302
  • Mozambique, 284–286
  • Multilateral Debt Relief Initiative, 117
  • Multilateral tax treaty, 171–173, 172t

N

  • National Credit Councils, 22, 33
  • New Partnership for Africa’s Development, 363
  • Niger, 332, 334, 337
    • bank reserve requirements, 207
    • financial sector depth, 273
    • foreign aid flows to, 48
    • foreign direct investment, 48
    • inflation in, 221, 242
    • interest rates, 221, 232
    • tax revenue, 152, 175, 181
    • total factor productivity, 49
    • trade, 322, 324, 328, 329
    • See also WAEMU
  • Nigeria, 242, 260, 318
    • government debt market, 351, 353
  • Nonperforming loans, 25, 27f, 263f, 303

O

  • Oil prices, 25
  • Organization for the Harmonization of Business Law in Africa, 367

P

  • Pan-African banking groups, 9, 25, 260, 261f, 301, 304
  • Per capita GDP, 47, 48f, 83, 84f
    • growth benefits of infrastructure investment, 147
    • growth trends, 65, 66f
  • Petroleum products
    • oil prices, 25
    • subsidies, 169
    • taxes, 169, 177
  • Political functioning
    • deepening of regional integration, 366–367
    • effects on growth, 53, 54
    • financial depth and, 283
    • social conflict, 51, 52f, 53–54, 370
    • See also Governance
  • Poverty gap, 82
  • Poverty line, 82
  • Poverty reduction
    • agricultural sector integration and, 361–363
    • benefits of WAEMU membership, 369–370
    • community policies for, 368–369
    • deep integration in WAEMU and, 366–370, 371f
    • education promotion for, 369
    • financial integration and, 364–366, 366f
    • future challenges and opportunities, 3
    • growth and, 83, 84f, 97–98
    • inflation effects, 363–364
    • in Mali, 87, 90, 91f
    • monetary integration and, 363–364
    • regional integration and, 10, 319, 357
    • in Senegal, 81–84, 83f, 83t
    • strategies to promote, 10, 357
    • trade integration and, 358–361, 360f
    • trends, 81, 82f
    • WAEMU performance to date, 2
  • Private bonds, 105–106
  • Private investment
    • effects on growth, 52
    • financing costs, 52
    • loans to firms, 291, 293f, 296
    • patterns and trends, 53f
    • return on investment, 52–53
    • securities market financing, 102
    • tax policy, 171, 171t
  • Productivity
    • agricultural sector, 76b
    • strategies to reduce vulnerability to shocks, 3
  • Program for Infrastructure Development, 368
  • Property rights, 51, 301
  • Prudential standards
    • current compliance, 2, 13, 23, 25, 27f, 256, 259, 263f, 265
    • opportunities for improving compliance, 8, 25–28
    • reserve requirements, 207–208
    • WAEMU objectives, 256
  • Public debt
    • ceilings, 120, 130, 134
    • convergence criteria compliance, 117, 118f, 127–128
    • current fiscal rules, 134
    • deficit bias contributing to, 117, 118f
    • fiscal-monetary policy coordination on, 37–38
    • future prospects, 25, 26f
    • holdings of, 237f, 268f, 269, 273–275
    • inflation and, 198
    • market characteristics, 352, 354f
    • patterns and trends, 23, 39f, 117, 119t, 149f
    • projections, 38
    • See also Foreign ownership of government debt
  • Public investment
    • convergence criteria, 133
    • cyclical patterns, 5, 114, 133, 134, 136–139, 139t, 142
    • efficiency, 68f, 115, 147, 154–156
    • fiscal deficits and, 23
    • fiscal space for, 5, 115, 147
    • growth and, 23, 30, 54, 67–68, 135, 135t, 137
    • international comparison of low- and middle-income countries, 135, 135t
    • opportunities for creating fiscal space for growth, 147
    • patterns and trends, 49, 50f
    • policies to promote sustainable growth, 5
    • recent patterns and trends, 23–24
    • response to external shocks, 138–139, 139t, 142
    • safeguards, 5
    • securities market financing, 102
    • strategies for improving efficiency of, 157

R

  • Real estate markets, 210, 211
  • Regional Council for Public Savings and Financial Markets, 16, 102, 103, 201, 271
  • Regional Economic Program, 368
  • Regional integration
    • in absence of central fiscal authority, 125
    • agricultural policy, 363
    • banking sector, 260–262
    • budget centralization, 141
    • business cycle synchronization, 59, 271
    • convergence criteria, 4, 15, 17–19
    • deep, 366–370, 371f
    • distributive effects, 357
    • financial, 364–366
    • fiscal policy coordination, 40, 114
    • fiscal policy to promote, 4–5
    • freedom of movement, 20, 21, 367
    • future challenges and opportunities for WAEMU, 1
    • legal, 367
    • lessons from trade network analysis, 340
    • monetary policy, 6, 196, 363–364
    • poverty reduction and, 10, 319, 357
    • securities market, 101–102
    • tariff policy, 9–10
    • WAEMU objectives, 15–16, 29
    • See also Tax coordination; Trade integration
  • Regional Stock Exchange, 102, 103
  • Regulation and supervision, financial sector
    • barriers to entry, 240
    • capital mobility, 200–201, 352–353
    • constraints to foreign investment in government debt, 352–353
    • crisis management, 306
    • of cross-border groups, 304
    • current efforts to improve, 25–28
    • future challenges and opportunities, 2, 7, 8, 12, 23, 257, 301
    • intermediation rules, 311
    • macroprudential, 304–306, 305t
    • microfinance institutions, 265
    • microprudential, 8, 257, 301, 303–304, 305t
    • mobile banking, 311–314
    • obstacles to mobile banking, 311
    • regional banking groups, 301, 304
    • regional vs. national, 271, 303
    • securities market, 112
    • See also Prudential standards; Surveillance
  • Remittances, 309, 310f, 314f
  • Return on investment, 52–53, 277, 279f
  • Risk assessment and management
    • banking sector, 262–265, 262b, 264t, 303–304
    • challenges to financial sector stability and growth, 301
    • countercyclical fiscal rules, 114, 134
    • data collection and dissemination to enhance, 304, 305
    • financial crisis prevention, 8, 257, 301, 305, 306–308, 366
    • financial sector development, 25–28, 259
    • fiscal, 4–5, 122, 133, 141–142, 143
    • liquidity injections by BCEAO, 197, 207, 235, 238–240
    • mobile banking, 314
    • recovery and resolution, 306–308, 307t
    • in securities market, 111
    • strategies for improving, 301, 303–306
    • systemic, 269–271

S

  • Sanctions regime, 19–20, 121, 128
  • Savings-investment gap, 24, 26f
  • Securities market, WAEMU, 259, 268f
    • auctions, 190, 302
    • borrowing costs, 127
    • commercial bank holdings of government securities, 235, 236f, 240
    • constraints to regional financing, 110–111
    • educational and outreach activities, 192
    • encoding of securities, 191
    • enhancing capacity to finance regional growth in, 111–112, 187
    • future prospects, 187
    • government debt issues, 104–105, 105f, 106t, 125–127, 126t, 187–188, 193t, 194t
    • growth financing from, 3–4, 45, 101, 102
    • institutional framework, 102–103, 102f, 112, 188–189
    • interest rate determinants, 106–110, 127, 128t
    • investment instruments, 103–104
    • investor base, 110, 111, 191, 302
    • issuance maturity trends, 192, 192f
    • issuance procedures, 103, 190, 191
    • lessons from WAEMU experience, 188–189
    • long-term issues, 105–106, 107t, 110, 111, 112
    • need for standardization of issuances, 188
    • obstacles to development of, 115, 187
    • operations, 104–106, 105f
    • opportunities for future development of, 115–116
    • origins and growth of, 101–102, 125–127, 187
    • Primary Dealers System, 191
    • principal component analysis, 109–110, 109f
    • regional activity, 266–269
    • regulation, 112
    • role of WAEMU Securities Agency, 187, 189–190, 189b
    • secondary market, 110–112, 115, 188, 302, 352
    • strategies for enhancing function of, 190–192, 302
    • systemic risk in, 111
    • transmission of monetary policy through, 211
    • transparency in, 111, 191
  • Securitization, 302
  • Senegal, 59, 332, 334
    • agricultural sector policies, 98
    • bank reserve requirements, 207
    • consumption patterns, 85, 86f
    • financial sector depth, 273
    • growth benefits of infrastructure investment, 147
    • growth incidence curve, 86–87, 88f
    • growth trends, 83, 84f
    • income distribution patterns, 85–87, 85t
    • inflation in, 221, 242
    • interest rates, 221, 232
    • microfinance institutions in, 265
    • ownership of government debt, 351, 352f
    • policies to promote inclusive growth, 98
    • poverty patterns in, 81–84, 83f, 83t
    • regional trade, 9
    • shock effects in, trade flows and, 336–337, 340
    • tax revenue, 152, 175, 182, 361
    • total factor productivity, 49
    • trade, 165, 318, 321, 322, 324, 326, 327, 329, 358
    • See also WAEMU
  • Service sector
    • growth trends, 50, 68, 69f
    • regional integration, 367–368
  • Sierra Leone, 318
  • Small and medium-sized enterprises, 29, 283, 302–303
  • Smuggling, 168
  • Social conflict, 51, 52f, 53–54, 370
  • Stock markets, 256, 259–260, 266–269, 270f, 274f, 275
    • access for small and medium-sized enterprises, 302–303
    • transmission of monetary policy through, 210
  • Structural reforms
    • demographic trends and, 80
    • growth and, 44, 50–51, 65, 70–74, 73f
    • obstacles to, 65
    • rationale, 28–29
    • recommendations for policies to promote, 65, 74, 74b
    • to reduce vulnerability to shocks, 3
    • strategies, 29
    • trade competitiveness, 50–51, 318
    • WAEMU commitment to, 29
  • Sub-Saharan Africa
    • financial sector development, 273
    • growth, 44, 47, 48f, 65, 81
    • inflation in, 242, 363, 364t
    • tax revenues, 148, 181
  • Subsidies, petroleum products, 169
  • Supervision. See Regulation and supervision, financial sector
  • Surveillance, 2
    • compliance with regional tax directives, 184
    • current convergence criteria compliance, 127–128
    • current regional macroeconomic framework, 127
    • data collection, 130–131
    • fiscal behavior, 114
    • fiscal policy coordination, 4
    • fiscal rule compliance, 121
    • sanctions procedure, 19–20, 121, 128
    • strategies to promote market discipline, 128–131
    • WAEMU administration, 19–20
    • See also Regulation and supervision, financial sector

T

  • Tariffs
    • current practice, 341, 342
    • current revenue, 342
    • Harmonized System classification, 165
    • to promote regional integration, 9–10
    • regional coordination, 164–166
    • tax transition goals, 179
    • See also Common external tariff
  • Tax coordination, 5
    • adherence among WAEMU members, 173–179, 184
    • capital income taxation, 164
    • competition and, 164, 170–171
    • corporate income taxes, 169–171, 175, 176t, 184
    • current, 115, 163
    • customs duties, 20, 164–166, 361
    • to encourage foreign investment in government debt, 356
    • to enlarge fiscal space, 115
    • evolution in WAEMU, 163–164
    • excise taxes, 167–169, 174–175, 174t
    • future prospects, 179, 184
    • harmonization and, 115, 163–164, 184
    • implementation challenges, 183–184
    • lessons from WAEMU experience with, 5, 115, 163, 183–184
    • to mobilize revenue, 179–183
    • multilateral tax treaty, 171–173, 172t
    • objectives, 163, 164
    • portfolio income, 171, 171t, 173, 175–176
    • special tax regimes, 176–179, 184
    • value-added tax, 166–167, 173–174
  • Tax policy
    • collection efficiency, 154f
    • constraints to foreign investment in government debt, 355
    • convergence criterion, 148
    • credibility of institutional framework, 184
    • exemptions for Kola bills and bonds, 104, 111
    • government debt market, 302
    • harmonization, 5, 115, 163–164
    • indirect rates, 148
    • opportunities for creating fiscal space for growth, 147
    • policymaking structure in WAEMU, 114
    • to promote sustainable growth, 5
    • raising revenue to enlarge fiscal space, 148–153
    • reliance on trade taxes, 115, 147
    • revenue collection trends, 148–150, 149f, 150f, 151–153, 153f, 180, 180f, 182f, 183f, 185t
    • revenue implications of common external tariff, 341, 342f, 346–348, 347f
    • revenue implications of regional integration, 360–361
    • revenue potential, 150–151, 159–160t
    • transition, 179
    • See also Tariffs; Tax coordination
  • Tax revenue-to-GDP ratio, 19, 23
  • Tax-to-GDP ratio, 148, 180
  • Tobacco tax, 167, 168, 174
  • Togo, 332, 337
    • bank reserve requirements, 207
    • business cycle synchronization, 59
    • financial sector depth, 273
    • foreign direct investment, 48
    • inflation in, 221, 242
    • interest rates, 221, 232
    • public spending, 155
    • shock effects in, trade flows and, 336–337
    • tax revenue, 149, 181
    • total factor productivity, 49
    • trade, 165, 322, 324, 326, 328–329, 334, 358
    • See also WAEMU
  • Total factor productivity
    • obstacles to growth in, 49–50, 65–67, 67f
    • patterns and trends, 49, 50f
  • Trade
    • export diversification to promote growth, 44, 70–74, 73f
    • export patterns and trends, 58f
    • export quality, 69, 70b, 72f
    • export trends, 68–69, 70b
    • obstacles to growth, 50–51
    • tax revenue from, 148, 150f, 152, 153, 154f, 159t
    • tax transition goals, 179, 180
    • WAEMU vulnerability to macroeconomic shocks, 58f, 59
    • See also Trade, intraregional; Trade network, WAEMU
  • Trade integration
    • agricultural, 361–363
    • constraints to, 358
    • global trade and, 358–359
    • growth and, 359–360
    • international food price fluctuations and, 362–363
    • objectives, 358
    • poverty and, 358–361, 360f
    • services, 367–368
    • tax revenue and, 359, 360–361
  • Trade, intraregional
    • agricultural products, 362
    • ban on trade restrictions within WAEMU, 20–21
    • common market objectives of WAEMU, 20–21
    • community solidarity levy, 360–361
    • comparative openness, 50, 51f
    • coordination of customs tariffs, 164–166
    • current import duties, 342, 342f
    • current structure, 9, 50–51, 51f, 318, 321
    • econometric analysis, 358
    • efficiency, 358
    • excise taxes, 167–169, 168t
    • export concentration, 358
    • growth potential, 9, 318
    • informal, 348
    • lessons from trade network analysis, 340
    • patterns and trends, 9, 50–51, 51f, 165–166, 165f, 318, 321, 322, 326, 341–342, 342f, 358
    • potential impact of common external tariff, 319
    • price elasticities of import demand, 343–344, 343t, 344t
    • revenue from import duties, 342, 342f
    • strategies for promoting, 29
    • trends, 58f
    • WAEMU objectives for promoting competitiveness in, 20, 21
    • WAEMU policy goals, 321
    • See also Common external tariff; Trade integration; Trade network, WAEMU
  • Trade network, WAEMU, 318
    • clique structure, 329
    • cohesion properties, 322–323, 323t
    • cohesion properties dynamics, 323–324, 324f
    • core-periphery structure, 326–329, 328t
    • dependency matrix, 336, 336t
    • graphic representation, 321–322, 322f
    • hierarchical clustering, 329–332, 330f, 331t, 333t, 334t
    • implications for regional integration, 340
    • network effects, 335–337, 337t, 339
    • overall architecture, 332–335, 335f, 339
    • patterns of trade in, 322, 323
    • power properties, 324–326, 325t, 327f
    • shock diffusion in, 337–340
    • signal diffusion, 335–336, 339–340
  • Transparency, 8, 35, 111, 121–122, 179, 257, 301
  • Transportation system, 362, 368
  • Treasury bills, 23, 103, 104, 105f, 108–109, 108f, 110, 125–127, 126t, 187–188, 188f, 211, 268f, 269
  • Treasury bonds, 103, 104, 108, 187–188, 188f, 268f
  • Trilemma, 199

U

  • Urban–rural differences
    • agricultural product trade and prices, 363
    • income distribution, 81, 90

V

  • Value added tax, 152, 166–167, 173–174, 182

W

  • WAEMU Banking Commission, 16, 271, 303, 304, 306–308
  • WAEMU Commission, 2, 7, 17, 18b, 29, 41, 114, 121, 184, 368
    • fiscal-monetary policy coordination and, 32b, 33
    • future of fiscal-monetary policy coordination, 13
    • surveillance program, 19–20
  • WAEMU Parliament, 17, 18b
  • WAEMU Securities Agency, 10, 28, 41, 112, 115, 187, 189–190, 189b, 192, 319, 355
  • WAEMU Treaty, 15, 16, 17, 32–33, 32b, 128, 163
  • Wages and salaries-to-tax revenue ratio, 19
  • Watts index, 85
  • West African Development Bank, 16, 105, 368
  • West African Economic and Monetary Union (WAEMU)
    • access to financial services, 256, 287–291, 288f, 289f
    • accomplishments to date, 12–13, 15
    • benefits of membership in, 369–370
    • budget, 17
    • business cycle synchronization, 59, 59t, 271
    • Central Bank. See Central Bank of West African States (BCEAO)
    • convergence criteria, 17–19
    • convergence criteria compliance, 19, 19t
    • cost of electronic payments, 313f
    • cross-border flows, 260–262
    • financial sector depth, 273–277
    • future challenges and opportunities, 1–2, 13, 15
    • gender inequality patterns, 92, 93f
    • growth variation within, 47, 135
    • interest rate patterns, 220f, 221, 222f, 223f, 238f, 268f
    • international comparison of growth in low- and middle-income countries, 135, 135t
    • macroeconomic instability evolution, 360, 361t
    • membership, 1, 12. See also specific country
    • objectives, 1, 12, 15–16, 17, 256
    • obstacles to growth, 44, 47–54, 57, 65–68, 101
    • operating principles, 12
    • origins, 12, 15
    • private sector credit, 291, 294f, 296
    • public spending efficiency, 154–157
    • right of free movement in, 20, 21, 367
    • securities market. See Securities market, WAEMU
    • structure, 12, 16–17, 18b, 37–38, 37f
    • tax revenue collection trends, 148–150, 149f, 150f, 151–153, 153f, 179–183, 182f, 185t
    • See also Trade, intraregional
  • West African Monetary Union (WAMU), 12, 16–17

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