Armenia as regional financial center via PSD Blog - The World Bank Group
The hidden side of globalization via PSD Blog - The World Bank Group
Congratulations to Slovakia! via PSD Blog - The World Bank Group
A press release just yesterday announced that the Slovak Republic graduated from borrower status with the World Bank. This is a welcome bright note in this dark economic environment. It is worthwhile to remember that not very long ago, Madeleine Albright referred to Slovakia as "the black hole of Europe." Just a decade later, Slovakia has seen impressive achievements in economic reform and growth in incomes.
Ján Počiatek, Minister of Finance of the Slovak Republic, had this to say:Over the past 15 years, the World Bank has assisted us with complex reforms by providing financial, technical and know-how assistance, which was very important to us...Going forward, we would be interested in continuing technical cooperation with the World Bank, especially in human resources and... The private sector vs. poverty via PSD Blog - The World Bank Group
Liberalization and inequality via PSD Blog - World Bank Group
The OECD has just released a massive report on inequality - see the press release, data and related materials, and the report itself, Growing Unequal? (gated). Now that a recession is beating at the gates of most of the rich countries, questions will undoubtedly be raised about how the pain is metted out to various income groups. Calls for re-regulation of many sectors of the rich economies will likely follow. And there's no doubt that financial sector regulation is due for a very close examination.
But it's worth looking at some of the countries that have liberalized the most in the past two decades to see what the consequences have been. Two things strike me in the figure below (taken from the report) concerning inequality in the post-communist countries of eastern Europe.
... China is not the only one courting Africa via PSD Blog - World Bank Group
Stand to the right via PSD Blog - World Bank Group
Newcomers to Washington DC rapidly learn that to stand on the left-hand side of the metro escalator at rush-hour is to risk being run down by an impatient, backpack-wielding local. At an event today in Bishkek to celebrate the Krygyz Republic's appearance at #3 on the Doing Business 2009 list of top reformers, Minister of Economic Development and Trade, Mr Akylbek Japarov, compared reform to an escalator ride where you can choose to ride or to climb. Kyrgyz reformers want to climb. Less active reformers may want to stand to the right.
The Kyrgyz Republic jumped 31 places to the #68 spot in Doing Business this year. A major contributor to this advance was a substantial reform of the construction permitting process - cutting some unneeded procedures, and combining others (notably... Weight-watchers in Tirana via PSD Blog - World Bank Group
Regulatory reform is like losing weight: with some focus and effort, losing the first couple of kilos is relatively easy. As soon as friends and relatives start to notice, they give compliments and encouragement - emboldening you to take it further. The hard part comes later: sustaining a healthy bodyweight over the years requires long-term efforts. Often, a lifestyle change is needed. Reforming a country's business environment is no different. Last Thursday, September 18, 2008, the World Bank/IFC launched Doing Business 2009 in Tirana, Albania, the runner–up reformer this year. Between June 2007 and June 2008, Albania threw off excess weight in the administrative burdens that face small and medium entrepreneurs. The country made an impressive jump of 49 places on the Ease of... The will to reform via PSD Blog - World Bank Group
What does it take to be a top ten Doing Business reformer? I just ran across a survey from World Public Opinion.org that might shed a little light on this question. The populations of both Azerbaijan and Egypt appear to be quite pro-globalization (or at least not very negative about the phenomenon):
Of course, there's always the question of cause and effect, but this is the third year that Egypt has been a top reformer. At the very least, it looks pretty likely that reform didn't turn them off from globalization.... Can Islamic Finance go micro? via PSD Blog - World Bank Group
With more than half-a-trillion dollars in assets and an annual growth rate that has outpaced conventional banks’ by nearly 50 percent, the Islamic finance industry is already making waves among investment fund managers. And this not only applies to the Muslim world: The Banker magazine recently named the United Kingdom to its list of the top 15 countries managing Sharia-compliant assets.
The new CGAP Publication Islamic Microfinance: An Emerging Market Niche argues that the Islamic finance industry, with its unprecedented popularity and growth, may be well-placed to address a critical need in microfinance: reaching the some 72 percent of people in Muslim-majority countries who do not use formal financial services.Much of that gap owes to unmet demand for products that comply with... Doing Business in Belarus via PSD Blog - World Bank Group
It's Tuesday, so this must be Minsk. The Doing Business 2009 roadshow is here because, while last year it took 231 days to transfer property in Minsk, this year it takes just 21 - as a result of comprehensive reforms including a one-stop shop for property registration, simplified procedures and computerization of records. This, together with reforms affecting 5 other DB indicators, made Belarus the #4 reformer in DB09, jumping 30 places overall (to the #85 spot) and a massive 81 places on the "registering property" indicator.
HiThe DB "top reformers" list can get some surprised reactions. But the reality is that an increasing number of countries - like Belarus - are quietly and systematically working away at cutting red tape and expanding e-governance in key areas of regulation... Doing Business in Azerbaijan via PSD Blog - World Bank Group
Doing Business 2009 - Five years of reforms via PSD Blog - World Bank Group
Doing Business 2009 is here! The sixth in the World Bank Group's annual series on business regulations, DB 2009 allows us to take a look at five years of reforms since DB 2004. But before I get to that, let me hit the highlights of DB 2009:
This year's top reformer is...drum roll please...Azerbaijan! Azerbaijan improved on 7 out of 10 of the indicators tracked by DB and moved up 64 slots in the overall rankings.
Two regions - Eastern Europe and Central Asia and Sub-Saharan Africa - accounted for 7 of the top 10 reformers: Azerbaijan, Albania, Kyrgyz Republic, Belarus, Senegal, Burkina Faso, and Botswana. The other top 10 were Columbia, Egypt, and Dominican Republic.
Once again, Singapore tops the rankings, followed by New Zealand, the United States, and Hong Kong, China. ... Integrating Eastern Europe’s Roma via PSD Blog - World Bank Group
I Fox, you Rabbit via PSD Blog - World Bank Group
Kiev, July 2008. The kids jumped all over me as soon as I arrived, my son jabbering excitedly in English and my daughter in Russian. It’s hard to believe they grew up in the same household. This is one of the consequences of my spending two years in Aceh, Indonesia, which was a non-family post when I went there in 2006. While I was there I parked my family in Kiev, where my wife is from. With the school year over, I’m back in Kiev to pick them up and move them to Ulaanbaatar.
The contrast between Ulaanbaatar and Banda Aceh is huge and required a lot of adjustment when I moved there last May. One day I was in a lush, hot, humid, jungle climate, with endless ocean, the next I was wearing jackets and sweaters and surrounded by Soviet architecture. I was astonished that in mid-May there... The spread of the staycation via PSD Blog - World Bank Group
Putin presses for small business reforms via PSD Blog - World Bank Group
The origins of capitalism via PSD Blog - World Bank Group
I spent part of the weekend reading The Captive Mind, a noteworthy book by Czeslaw Milosz. Milosz was a Polish emigre and wrote this book in 1953 - also a noteworthy year, since both Joseph Stalin and Klement Gottwald died in 1953. It's a quick read on the plight of eastern European intellectuals after the Second World War, and well worth the investment of time.
There was one passage that particularly struck me that seems to give a bit of insight into what we might call the origins of capitalism. In a chapter entitled "Man, This Enemy", Milosz had this to say about the petty bourgeoisie in the people's democracies:The petty bourgeoisie, that is the small merchants and craftsmen, cannot be taken so lightly. They constitute a powerful force, one that is deeply rooted in the... Coke vs. kvas via PSD Blog - World Bank Group
I suppose after the attention it got with the Big Mac Index, the Economist couldn't help but continue to rely on mass-produced food items as economic indices. In this week's Economist, there's an article that purports that Coke can serve as an index of happiness. In this case, the analysis is restricted to Africa. The Economist argues that "[a]t a macro-level, when Coke fails, the country whose market it is trying to penetrate usually fails too." By this measure, it predicts a bright future for Africa:...if Coca-Cola's predications are anything to go by, Africa's future is mostly bright. The company expects sales in Africa to grow by an annual 10-13% over the next few years.If we were to extend this index to other parts of the world, we'd find one country experiencing a troubling trend -... Real estate is booming - in Turkmenistan! via PSD Blog - World Bank Group
While real estate has been taking a hit in many parts of the world, there is at least one place that is booming - Turkmenistan. Sebastien Peyrouse, writing in the CACI Analyst, describes the scene in Ashgabat, Turkmenistan's capital:In the city center, expropriations are continuing as former Soviet quarters are razed to make way for grand, green esplanades and new building-lined avenues. Apart from administrative buildings, dozens of residential buildings with marble facades have also materialized.The two big players in this construction boom are French and Turkish firms, and competition is getting stiff. Between construction firms from the two countries, they've managed to take in contracts worth somewhere between 2.3 and 2.5 billion euros. That's a tidy sum. It makes you wonder how... Richest man in Europe? via PSD Blog - World Bank Group
For a long time, the title of richest man in Europe fell to Ingvar Kamprad, the founder of Ikea. It seems, though, that his title may have been taken away. Rinat Akhmetov (pictured), a Ukrainian businessman, may now hold that honor, at least according to an article in the Korrespondent (Hat tip: Ukrainiana). According to the Korrespondent, Akhmetov is worth some $31.1 billion, while Forbes has Kamprad pegged at 'only' $31 billion. If it's true, this development would be consistent with a Merrill Lynch/Capgemini study showing that Western Europe is losing its share of the world's billionaires because of large gains in developing and transition countries. However, Akhmetov is not the only person with a claim to be richest man in Europe. According to Stanislav Belkovsky, a... A simple solution to inflation via PSD Blog - World Bank Group
Russian CSR - no longer a contradiction in terms? via PSD Blog - World Bank Group
Privatizing health care in Georgia via PSD Blog - World Bank Group
Big changes are underway in Georgia's health sector. The central government is taking steps to privatize both publicly owned hospital and health insurance. As it stands, the public health care system inherited from the Soviet era is bloated - only about 30 percent of its hospital beds are being used, and many of the 250 hospitals need renovation. An article in Transitions Online cites the Minister of Labor, Health, and Social Affairs on the current state of things:It is absolutely impossible for [a] state like Georgia to retain...254 publicy owned hospitals...Therefore, private medical insurance and [a] private hospital network [are] something that we think is the only way out of the situation. The Georgian government has chosen not to sell the hospitals through an auction or open bidding... The view from Russian business via PSD Blog - World Bank Group
Russian FDI numbers debunked via PSD Blog - World Bank Group
What a Long Strange Trip It???s Been (for V??clav Klaus) via PSD Blog - World Bank Group
V??clav Klaus, the president of the Czech Republic, has followed a curious path since his days as an employee of communist Czechoslovakia???s state bank. As the remarkably successful leader of the Civic Democratic Party, Klaus brought Czechoslovakia???subsequently, the Czech Republic???back into Europe. During his tenure as prime minister, Klaus hoped that a quick series of liberalizing reforms would set the Czech Republic apart from its peers in eastern Europe, granting it early entry into the European Union. Just yesterday, however, he penned an op-ed denouncing the euro, one of the cornerstones of the European Union. What explains this about-face from a champion of free markets to a foe of the euro, with its inherent requirement of freer labor and capital markets?To explain this turn... Oil Prognostications via PSD Blog - World Bank Group
The sky is falling???or so the head of Gazprom, the state-owned Russian energy giant, would have us believe. Today???s FT reports that Alexei Miller has predicted oil will hit $250 per barrel in 2009. Should we believe such a prognostication? Before you throw all your money into investments in oil companies, let???s remember the backdrop for such a prediction: Russia is courting foreign investors concerned about the security of their investments at the same time as BP and a group of Russian shareholders are fighting over control of the TNK-BP joint venture oil company. Medvedev, Russia???s new president, has been attempting to convince foreign investors that Russia is a safe bet, but Russian shareholders in TNK-BP have been making this look questionable with the trouble they???ve been...
Risky Business via PSD Blog - World Bank Group
For a handful of countries, the rise in oil prices has proven a boon to economic development. Russia is perhaps the most notable example. Bucking the trend in much of the rest of the world, the sale of new cars in 2007 in Russia jumped by 36 percent as a result of large increases in income, according to the latest edition of the Economist. But net oil importers are increasingly faced with a hard set of decisions about how to respond to this difficult environment. A new note in the journal Public Policy for the Private Sector provides guidance on exactly this conundrum.Titled Oil Price Risks, the note lays out a method for measuring the vulnerability of oil importers to further price shocks. A country???s vulnerability is measured by the ratio of its net oil imports to GDP. The authors...