Editor’s note: The findings, interpretations and conclusions expressed herein are those of the authors and do not necessarily reflect the view of the World Bank Group, its Board of Directors or the governments they represent.
For business, the conversation around tax and sustainable development can be tough. Yet
The Update describes the state of the Indian economy, shares its perspective on the Indian growth experience and trajectory over the past two and a half decades, and analyses the near-term outlook for growth, the global economic outlook and its impact on the Indian economy.
The Update, to be formally launched on March 14, features a historic analysis of India’s economic performance in order to assess what it will take India to return to growth rates of 8 percent and higher on a sustained basis.
Blockchain is the subject of considerable hype, thanks largely to the rise (and fall and rise...) of high profile digital currencies. Beyond this spotlight, development experts and innovators are exploring whether the technology behind cryptocurrencies can be leveraged to advance gender equality.
Blockchain is a distributed ledger technology that facilitates peer-to-peer transactions without using an intermediary. (The technology is also notoriously difficult to follow, but we find this brief video helpful and this talk explains blockchain well, if you have a bit more time.) Put simply, the system is maintained by collaboration, code and sometimes competition. Many experts refer to Google Docs to explain the concept: multiple users can access the same document simultaneously and they can all see the changes. This feature potentially makes it suited for validating records and processing financial transactions in the absence of strong institutions.
2018 started with the good news. The World Bank’s Global Economic Prospects and the IMF’s World Economic Outlook both show that the global economy is in a recovery. Furthermore, it is expected that the upturn is broad-based as the growth is increasing in more than half of the world economies. Global Economic Prospects report that in advanced economies, growth in 2017 is estimated to have rebounded to 2.3 percent while emerging and developing economies (EMDEs) were projected to have higher-than-expected growth of 4.3 percent. Overall, global growth is projected to edge up to 3.1 percent in 2018.
Over the last decade debt managers, like the central bankers, fiscal policy managers and regulators, had to deal with the global financial crisis. During this period, while debt levels were increasing in many countries, thanks to the unconventional monetary policies, interest rates went down, maturities lengthen up to 100 years, and portfolio capital flows moved across markets. In the end, those were very unusual times. Now the question is: Is this the end of the global crisis? Are we back to the “normal” times?
Indeed, it doesn’t look so.
In the wake of the Global Financial Crisis (GFC), many wondered whether the strong pre-crisis trend toward greater internationalization in banking would be reversed and, more immediately, whether local state-owned banks had to assume a larger role in restoring banking stability and ensuring the delivery of credit. We revisit those conjectures in the light of new data on bank ownership and research on the post-Crisis period (Cull, Martinez Peria, and Verrier, 2018).
Railways are very capital intensive and increasingly need to attract financing from the private sector to be successful. That is why the World Bank recently updated its Railway Toolkit to include more information and case studies on railway financing. Here, in a nutshell are the key lessons about railway financing from this update.
- Financial Solutions
- maximizing finance for development
- Public Private Partnerships
- private investment
- infrastructure financing gap
- infrastructure financing
- transport financing
- Sustainable Communities
- sustainable transport
- sustainable mobility
- Urban Development
- Public Sector and Governance
- Private Sector Development
- Law and Regulation
- Financial Sector
Like many Sri Lankans across the country, I joined Sri Lanka’s 70th Independence Day festivities earlier this month. This was undoubtedly a joyful moment, and proof of the country’s dynamism and stability.
The country’s social indicators, a measure of the well-being of individuals and communities, rank among the highest in South Asia and compare favorably with those in middle-income countries. In the last half-century, better healthcare for mothers and their children has reduced maternal and infant mortality to very low levels.
Sri Lanka’s achievements in education have also been impressive. Close to 95 percent of children now complete primary school with an equal proportion of girls and boys enrolled in primary education and a slightly higher number of girls than boys in secondary education.
The World Bank has been supporting Sri Lanka’s development for more than six decades. In 1954, our first project, Aberdeen-Laxapana Power Project, which financed the construction of a dam, a power station, and transmissions lines, was instrumental in helping the young nation meet its growing energy demands, boost its trade and develop light industries in Colombo, and provide much-needed power to tea factories and rubber plantations. In post-colonial Sri Lanka, this extensive electrical transmission and distribution project aimed to serve new and existing markets and improve a still fragile national economy.
Fast forward a few decades and . Yet, .
Notably, the current overreliance on the public-sector as the main engine for growth and investment, from infrastructure to healthcare, is reaching its limits. and the country needs to look for additional sources of finance to boost and sustain its growth.
As outlined in its Vision 2025, the current government has kickstarted an ambitious reform agenda to help the country move from a public investment to a more private investment growth model to enhance competitiveness and lift all Sri Lankans’ standards of living.
Now is the time to steer this vision into action. This is urgent as . As it happens, private foreign investment is much lower than in comparable economies and trade as a proportion of GDP has decreased from 88% in 2000 to 50% in 2016. Reversing this downward trend is critical for Sri Lanka to meet its development aspirations and overcome the risk of falling into a permanent “middle-income trap.”
By some estimates it could cost as much as $4.5 trillion a year to meet the Sustainable Development Goals (SDGs), and obviously, we will not get there solely with public finance. And there’s the rub: Countries will only meet the SDGs and improve the lives of their citizens if they raise more domestic revenues and attract more private financing and private solutions to complement and leverage public funds and official development assistance. This approach is called maximizing finance for development, or MFD.
Over the past 15 years, China has emerged as one of the world’s financial inclusion success stories. While much attention has been paid to the rapid innovation and massive scaling of Chinese fintech companies, China’s successes in financial inclusion reach beyond fintech. Account ownership has increased significantly and is now on par with that of other G-20 countries. One of the largest agent banking networks in the world has been established. And a robust financial infrastructure has been developed that underpins these successes.
So what can policymakers in other countries learn from China’s experience? While China is in some ways a unique environment, there are still valuable lessons to be learned from both its successes as well as its remaining challenges.
A new report released last week -– Toward Universal Financial Inclusion in China: Models, Challenges, and Global Lessons - provides a wealth of data and information about the various initiatives and efforts that have contributed to China’s advances in financial inclusion. The report, which was jointly written by the People’s Bank of China and the World Bank Group, also outlines remaining challenges and distills lessons for policymakers in other countries.
Islamic finance has the potential to play a crucial role in supporting the implementation of the Sustainable Development Goals (SDGs). In the face of significant financing needs for the SDGs, Islamic finance has untapped potential as a substantial and non-traditional source of financing for the SDGs.
The growth of Islamic finance has been rapid at 10-12% annually over the past two decades. By 2015, the industry had surpassed US$1.88 trillion in size. Islamic finance has emerged as an effective tool for financing development worldwide, including in non-Muslim countries, and may prove to be an important contributor towards realizing the SDGs.
The Third Annual Symposium on Islamic Finance was held in Kuala Lumpur in November 2017, co-organized by the World Bank Group, Islamic Development Bank, International Center for Education in Islamic Finance (INCEIF) and Guidance Financial Group to explore the potential contributions that Islamic Finance can make to achieving the SDGs.