Financial Crisis
Submitted by Shanta on Wed, 07/01/2009 - 10:17.  A friend sent this photograph, with the following caption: “Don't let the recession take the flame out of your romantic lives! There's always sunshine in Africa! Resourcefulness at its best.... Anything to keep the wheels turning!”
The picture and caption reminded me of the song “Girl, your marginal benefits…” which could be viewed as a painless way to learn microeconomics, or a quirky love song.
 So far the dialogue between the main political parties has failed to produce an agreement on the way forward for a return to a democratic Government. For the time being, the economy continues to deteriorate but has shown some resilience due to two factors;
(i) Fiscal Policy: The strict fiscal policy pursued by the authorities has helped stabilize key financial indicators (interest rates, inflation, and the exchange rate)
Submitted by Shanta on Tue, 06/09/2009 - 09:08.
While my blog posts seemed to elicit a fair number of comments, I had been wondering how many of them, if any, were coming from my World Bank colleagues. Last Friday, I got to find out. Our Internal Communications department ran a story on the Bank’s intranet with the headline “The effects of the global recession on Africa will be permanent, says Africa Chief Economist.” The story then linked to my blog post, “Why aid to Africa must increase”. My first reaction to some of the comments was “Ouch!”
Submitted by Shanta on Mon, 05/25/2009 - 15:15.
Dans les pays riches, lorsque le taux de croissance économique diminue de 3 ou 4 points, les individus perdent leur emploi et, probablement, leur maison, mais ils les retrouvent lorsque la reprise économique intervient. Dans les pays pauvres d’Afrique, les enfants sont retirés de l’école — et sont privés de la possibilité de devenir plus tard des adultes productifs. Dans certains cas, les enfants meurent avant d’avoir eu la chance d’aller à l’école. Si l’effondrement actuel de la croissance s’apparente à ceux qu’a connus l’Afrique par le passé, 700 000 enfants africains supplémentaires mourront probablement avant leur premier anniversaire.
Submitted by Shanta on Mon, 05/25/2009 - 15:14.  In rich countries, when economic growth declines by three or four percentage points, people lose their jobs and possibly their houses, but they regain them when the economy rebounds. In poor African countries, children get pulled out of school—and miss out on becoming productive adults. In some cases, children die before they have a chance to go to school. If the current growth collapse is typical of the ones Africa has experienced in the past, an additional 700,000 African children may die before their first birthday.
Submitted by Shanta on Thu, 05/14/2009 - 11:43. I flinched when, at a recent BBC World Debate Zeinab Badawi asked Bob Zoellick why, when there are so many economists at the World Bank, they couldn’t do anything about protecting developing countries from the impact of the global crisis. Were we asleep at the wheel? Montek Ahluwalia gave us temporary respite by pointing out that the economists in the industrialized countries didn’t see the global recession coming even in their own countries, much less that it would spread to poorer countries.
But this begs the question of why economists didn’t forecast the global financial and economic crisis. Recently there have been two thoughtful pieces addressing this question.
Submitted by Shanta on Tue, 05/05/2009 - 09:04. Lors d’une mission en Europe, j’ai assisté à un séminaire à l’Institut Français des Relations Internationales IFRI. J’ai parlé des quatre canaux de transmission de la crise en Afrique, et la réponse de la Banque Mondiale. Le débat qui a suivi mon discours était très riche et intéressant. Les questions étaient diverses—sur la relation entre la croissance et la pauvreté, les solutions régionales et les états fragiles. Vous pouvez lire le compte rendu de la conférence ici.
Submitted by Shanta on Wed, 04/29/2009 - 10:11.  The seminar mentioned here went off very well. You can watch the video here. The main messages were:
(i) Economic policy should strive for flexibility, as the future is uncertain. Emmanuel Tumusiime-Mutabile said this was why he had allowed the Ugandan shilling to depreciate, although the deputy governor of the central bank of Sudan questioned whether an exchange rate depreciation would lead to inflation, and there was an interesting exchange on whether the alternative, holding the exchange rate fixed during a difficult period, wouldn’t be even worse.
 Following weeks of political turmoil, President Marc Ravalomanana resigned on March 17, 2009. The leader of the opposition, Andry Rajoelina, ex-Mayor of Antananarivo, became “President of the Transition Authority” with the support of the army. The transition – increasingly being referred to as a coup by the international community – marks the culmination of a pitched power struggle that began in mid-January 2009, has put development on hold, and taken over 150 lives. Political uncertainty is nonetheless likely to remain until a clear consensus on the way forward emerges among the political forces in the country – and its subsequent recognition by the international community.
Submitted by Shanta on Tue, 04/21/2009 - 10:30. On Thursday, April 23, 2009, we are holding a seminar on “Economic policy in Africa in light of the global crisis.” The speakers include Emmanuel Tumasiime-Mutabile, the Governor of the Central Bank of Uganda; Lamine Zeine, Minister of Finance of Niger; and Ali Mansoor, Secretary of Finance of Mauritius. I encourage you to send in your questions to this group by 11 a.m. (Washington time) on Thursday, April 23rd. We will read out at least five of the questions received from the blog during the seminar, and report back (on the blog) the answers and comments
The motivation for the seminar is as follows:
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