The Nordic Africa Institute – Publications

In recent decades, Egypt has experienced rapid internal migration movements triggered by urbanization, socioeconomic development, and environmental changes. From a literature perspective, few scholarly studies have empirically examined the drivers and welfare impacts of internal migration in Egypt, despite the increasing recognition of its inextricably links to urban sustainability. The present study utilized data from two waves of an Egyptian Labor Market Panel Survey (ELMPS) conducted in 2012 and 2018 and consisting of 63,909 observations to examine factors that determine internal migration decisions and their subsequent welfare effects. The results of the two-stage Heckman selection model indicate that both the determinants of internal migration decisions and welfare outcomes differ appreciably depending on migration stream as well as the socioeconomic characteristics of the migrants. In particular, females were found to be more likely to migrate from rural to urban areas, lending support to the growing literature on the “feminization of migration” in developing countries. The OLS regression results, after correcting for self-selection, make a strong case for the positive welfare gains from internal migration in Egypt. Specially, we found that the welfare gains for older and female migrants are much higher than other age and gender groups. A comparison of the welfare effects between different migration streams shows that all migratory movements were associated with positive and statistically significant welfare gains, except for rural-to-urban migration that was surprisingly found to be associated with significant welfare loss for the migrants. Urban-to-urban migration was found to have the strongest welfare enhancing effects on all migrant groups. The empirical findings underline a number of research and policy implications for a sustainable management of internal migration in Egypt and other countries with similar internal migration trends.

The Covid-19 pandemic has posed unprecedented challenges to small and medium agri-food enterprises (SMAEs) in developing countries. However, research investigating what risks Covid-19 posed to these firms, how they responded, and what business opportunities emerged to SMAEs from the pandemic remains scanty. Drawing on a sample of 166 specialist SMAEs in Egypt, this study addressed these entwined questions by using multiple indicators and multiple causes (MIMIC) and mediation analysis. Our results point out that the Covid-19 pandemic exposed Egyptian SMAEs to complex and multidimensional risks, and caused profound effects on both upstream and downstream stages of their supply chains. In general, Egyptian SMAEs adopted a ‘wait-and-see’ approach to cope with such Covid-19 risks and impacts, which was attributed to their lack of sufficient financial resources to develop risk management strategies and formalize structures to deal with unexpected events. Interestingly, the results showed that several business opportunities emerged from pandemic; but SMAEs' resource disadvantages constrained their capacity to seize and exploit these opportunities. Moreover, we found that mitigation strategies adopted by SMAEs present a mediating factor between perceived Covid-19 risks and perceived business opportunities. Overall, our findings call for a paradigm shift in relation to enterprise risk management in developing countries' SMAEs toward more holistic frameworks to enhance their preparedness to future shocks, make mature operational and strategic management decisions, and exploit strategic opportunities.

Nearly half of Africa’s economies are on the brink of debt distress. Unlike previous debt crises, the current one is characterised by a shift from multilateral to commercial and bilateral creditors, notably China, and the proliferation of Eurobonds. Pressured by heavy debt burdens, there is a risk that African governments divert funds from essential sectors such as education, health care and agriculture, causing a vicious cycle of stalled development, food insecurity and an elevated risk of socio-political instability.

Purpose – A better understanding of the determinants of demand through accurate estimates of the elasticityof import demand can help policymakers and exporters improve their market access and competitiveness. This study analyzed the EU’s demand for imported potato from major suppliers between 1994 and 2018, with the aim to evaluate the competitiveness of Egyptian potato.

Design/methodology/approach – This study adopted an import-differentiated framework to investigatedemand relationships among the major potato suppliers to the EU’s. To evaluate the competitiveness of Egyptian potato on the EU market, expenditure and price demand elasticities for various suppliers werecalculated and compared.

Findings – The empirical results indicated that as income allocation of fresh potatoes increases, theinvestigated EU markets import more potatoes from other suppliers compared to imports from Egypt. The results show that EU importers may switch to potato imports from other suppliers as the import price ofEgyptian potatoes increases, which enter the EU markets before domestically produced potatoes are harvested.

Research limitations/implications – Due to data unavailability, the present study relied on yearly data onquantities and prices of EU potato imports. A higher frequency of observations should allow for consideringseasonal effects, and thereby providing a more transparent picture of market dynamics and demand behaviorof EU countries with respect to potato import from various sources of origin.

Originality/value – The study used a system-wide and source differentiated approach to analyze importdemand. In particular, the empirical approach allowed for comparing different demand models (AIDS,Rotterdam, NBR and CBS) to filter out the superior and most suitable model for that data because the suitabilityand performance of a demand model depends rather on data than on universal criteria.

The generally held belief is that government spending on education and research and development is to bring about direct impacts on the advancement and sustainability of an economy. Nonetheless, this evidence is not prevalent within industrialized and third-world economies, particularly among the foremost ten carbon dioxide releasing economies. Therefore, the OLS and the DEA are used to estimate the relationship between government public spending on research and development plus green economic advancement, utilizing data from several countries between 2008 and 2018. The findings reveal a varying green economic expansion indicator, which is a result of inadequate government programs to deliver results. Subsequently, for types of expenditure where formal juxtaposition can be made, such as RE compared with conventional energy, the authors detect that multipliers on green cost are almost twofold their traditional sources. The point approximate of the multipliers is 1.1–1.7 for green energy financing and 0.4 and 0.7 for conventional energy financing, depending on time and modeling. These results passed all the required sensitivity analyses. They provided backing to the bottom-up analysis, which reveals that controlling global warming, including preventing biodiversity extinction, works hand in hand with creating economic development and advancement. 

Pan-Africanism was a vital force in the decolonisation and liberation struggles of the African continent. Today, some regional integration initiatives are part of the legacy of Pan-Africanism. Nevertheless, a retreat in Pan-Africanist consciousness justifies the on-going reform of the African Union and other related platforms for African regional integration, peace and development.

This paper provides an empirical analysis of the determinants of the bank lending rate in Ghana using annual time series data from 1970 to 2013. We found evidence of a long-run equilibrium relationship between the average lending rate charged by commercial banks and its determining factors. In the long run, bank lending rates in Ghana are positively influenced by nominal exchange rates and Bank of Ghana’s monetary policy rate but negatively with fiscal deficit, real GDP and inflation. We also find positive dependence of the bank lending rate on exchange rates, and the monetary policy rate both in the short and long run. Specifically, our findings reveal that the Bank of Ghana’s monetary policy rate and the exchange rate, by far, show strong contemporaneous effects on the average bank lending rate in Ghana.

This study is a contribution to the empirics of climate change and its effect on sustainable economic growth in Sub-Saharan Africa (SSA). Using data on two climate variables: temperature and precipitation, and employing panel cointegration econometric technique of the long- and short-run effects of climate change on growth, we establish that temperatures beyond 24.9 °C would significantly reduce economic performance in SSA. Furthermore, we show that the relationship between real GDP per capita on one hand and temperature on the other is intrinsically nonlinear.

This volume reports on the findings of an international research project on aid effectiveness in Africa. Research teams in eight African countries in collaboration with northern research institutes conducted field work to seek to understand why aid often failed to promote development and how it could be improved. The volume provides evidence that Africa's economic crisis has had a devastating effect on aid effectiveness and that too often, donors dominate aid decisions, leaving governments without any sense of ownership over their own development efforts. The volume concludes that to become more effective in the future, aid to Africa will have to find ways to develop more effective public institutions that are able to fully take charge of the development process.

Migrant remittances – money and gifts sent to relatives back home – have attracted increasing international attention. The flow of remittances has become a major source of revenue for developing countries, exceeding the volume of aid. Three recent studies at Uppsala University bring this issue to light in the context of Sweden’s Policy for Global Development.

Very little has so far been known about the flow of remittances from Sweden; official data indicate an amount exceeding 4 billion kronor in 2006. The real flows are most likely higher; Swedish and international studies estimate that real remittances are 30-50 per cent above the officially recorded amounts. Statistics Sweden (SCB) is recommended to enhance its records of remittances in terms of desirable scope and reliability, for instance regarding specification of the amounts remitted to different countries.

Remittance flows from Sweden are linked to the remitters’ incomes and, hence, vary with the business cycle. Experience suggests that the ongoing world economic crisis will have a negative impact on remittance flows also from Sweden.

It is suggested that enhanced knowledge in Sweden about available remittance services and their costs and measures to promote a better functioning remittance market could increase the net value of these money.

Liberia has a long history of non-inclusive development with dire consequences for its population, in terms of poverty and conflict. This research explores recent trends in the post-war Liberian cocoa market that suggest a possible break with the past. Structural changes in the cocoa market are found to have strengthened the bargaining power of smallholder farmers and increased their market participation on increasingly beneficial terms in a number of ways – such as a larger share of the world-market price and better access to inputs and services. The cocoa market has become more inclusive. The research explains how a series of institutional changes – changes in the formal and informal rules of the game – have contributed to this process and suggests why. It identifies four major causal mechanisms that help us better understand the role that institutions can play in making agricultural markets more inclusive – in Liberia and beyond.

The business environment for smallholder cocoa farmers in Liberia has improved. Game-changing efforts by the government have increased competition among cocoa buyers and led to higher producer prices. Farmers are also encouraged by new investors to improve the quality of cocoa, for which they earn more. In addition, famers organisations have strengthened their bargaining power. However, policy-makers must be alert to a possible backlash if competion is not ensured, and from elite capture of farmers’ organisations.

This paper evaluates the carrying capacity of cultivated land in Guangdong Province,China, using the entropy weight method. Ecological and environmental pressuresignificantly impacts capacity, while economic and social factors are stable.Production pressure fluctuates and rises. To improve capacity, we must reduce ecologicaland environmental pressure, protect cultivated land resources, develop andpromote green technology, and maintain water conservation facilities. The resultsindicate that reducing ecological and environmental pressure is essential to improvethe carrying capacity of cultivated land in Guangdong Province. In conclusion, thisstudy highlights the importance of balancing economic growth with environmentalsustainability in developing regions like Guangdong Province. It suggests that aholistic approach that considers ecological, economic, and social factors is necessaryto ensure long-term food security and sustainable land use practices.

The potential link between child-related cash transfers and increased fertility is often raised asan issue of concern when debating their use. Old-age pension is a form of cash transfer wheretheory would suggest the opposite impact, i.e. pensions equal decreasing fertility. A handful ofSub-Saharan African countries have introduced non-contributory social pensions that cover thegreat majority of the older population. It makes them into a distinct group in relation to the rest ofthe region where public old-age security arrangements, if existing at all, are largely reserved forthe formal sector. This paper attempts to trace any impact these high-coverage pensionschemes may have had on fertility. Findings suggest that there has been such an impact, in therange of 0,5 to 1,5 children less per woman depending on model specification.

There is a striking variation in the prevalence of the human immunodeficiency virus (HIV) among countries and regions of the world, with a distinct geographical pattern. This paper explores the link between income inequality and HIV. It presents empirical evidence—a meta-study and additional cross-country regression results—that clearly support the argument that such a link exists. The interpretation of this link is an open issue. Four different hypotheses are discussed, each one pointing out a transit route from income inequality to HIV. The paper presents preliminary evidence on these routes and identifies potential areas for future research.

The forecast of economic growth in Sub-Saharan Africa have repeatedly been revised downwards over the last 6 months. It has now reached 2% which is close to a third of what it was a year ago, implying negative growth in per capita terms. Considerable uncertainties remain in these forecasts. Oil- and mineral exporters are likely to take a severe first hit, as collapsing commodity prices translate to reduced export revenues and foreign direct investments are paralyzed. Two additional flows that connect Africa to the global economy, where impact is harder to predict, are aid and remittances. This note explores how these flows have reacted in OECD countries during previous episodes of severe financial crises. It is shown that if these past episodes serve as a guide to the present, then a considerable reduction is to be expected. Remittances would react immediately, while the impact on aid would be lagged but being more prolonged. Given that projection, the critical need for more of accountability in international aid commitments is discussed.

In many African countries it is a known fact that a person belonging to the same ethnic group as the president is less likely to be treated unfairly by the government. The same is valid for people living in the president’s home region, regardless of their ethnic affiliation. Ethnic and regional favouritism are two distinct but parallel problems. This Policy Note, drawn from data involving 20 000 citizens in 15 African countries, explore the scope of favouritism and its implications for citizens and democratic attitudes.

This study examines how non-farm entrepreneurship influences rural household energy poverty and explores caste-based heterogeneities in outcomes in India. The study used different quasi-experimental econometric methods to analyse panel data from the waves 1 and 2 (2015 and 2018) of the Access to Clean Cooking Energy and Electricity Survey of States (ACCESS) in India. The overall results across all estimation methods show that households' engagement in non-fam entrepreneurship significantly contributes to a reduction in their energy poverty levels and the probability of being energy poor. The sizes of the reduction vary across the four castes (General Caste, Scheduled Tribe, Scheduled Caste, and Other Backward Caste). The energy poverty reducing effect of non-farm entrepreneurship is particularly high among members of the Scheduled Tribe. Further mediation analyses reveal that non-farm entrepreneurship potentially affects rural households' energy poverty through their accumulation of financial (savings) and durable assets which possibly enable them to access cleaner energy sources for lighting and cooking. We encourage governments to pay attention to policies that promote non-farm entrepreneurship which has the potential to enhance asset accumulation and reduce rural energy poverty in the process.

The current global green mineral boom is driving increased mining exploration in Africa. The African Union has outlined shared visions to leverage the continent’s mineral reserves and youth boom in pursuit of sustainable development and socio-economic transformation. Achieving these goals requires mineral-rich African economies to transition from commodity export to manufacture of higher value-added products. To do so, they need to invest in their youthful population, and in research and innovation.

Overcoming the gender gap in agriculture is nowadays one of the focal points of major international institutions, governments and development agencies. In this paper, we discuss some effects of international aid in rural contexts on gender dynamics and women’s empowerment. Through the analysis of some small-scale projects in Northern Senegal – implemented within a wide rural development aid program in West Africa - we develop some reflections on the observed women-oriented projects: we stress the risk that women end up being “locked” into pre-defined roles, namely in small-scale food processing activities, by a standardized logic of aid projects. We develop an analysis of the practices that may lead to this outcome and of the characteristics of such “women roles” in value chains. We discuss this observation in the light of the gendered division of tasks in primary products value chains and of the literature on the integration of “gender” in development thinking. By means of this analysis, we draw some reflections on the discrepancy between explicit empowerment goals and unintended outcomes of aid.

Handel kan bidra till en långsiktig ekonomisk tillväxt genom att ge företag tillgång till ny teknologi. Handel ger också möjligheter till ett fördjupat deltagande i regionala och globala värdekedjor, vilket minskar afrikanska ekonomiers beroende av råvaruexport. Detta kan leda till fler jobb, ökade inkomster, minskad fattigdom och mildra globala chockers effekter på ekonomin. En handelsbaserad utvecklingsagenda bör integreras med ländernas övergripande utvecklingsstrategier. En förutsättning för att uppnå positiva effekter av ökad handel är att reformer för att underlätta handeln kompletteras med breda reformer som stärker den institutionella miljön och produktionskapaciteten i afrikanska länder. 

One of the most efficient ways of promoting long-term inclusive development is to ensure domestic financing through a stable, broad-based and fair tax system. At the present moment, as policy makers across the world are preparing post-pandemic policies, there is an opportunity to open the way to tax reform and to boost inclusive development in many African countries – provided the correct measures are chosen.

The Coronavirus crisis hit Africa at a time when many of the continent’s economies were already at risk of debt distress. Multiple shocks caused by the pandemic have increased their need for new loans. The increasing complexity of the loan market makes it hard to achieve debt relief settlements. The way forward is instead diversification of the export industry, reform of the tax systems, investment in human development and closing the digital divide.

As public debts are increasing in many African countries, we see a new type of debt distress, where short-term commercial loans and bonds have replaced some of the long-term multi- and bilateral loans. This policy note highlights two topical questions: what lies behind increasing levels of debt in Africa, and what are the challenges when financing development projects through loans?

Policy recommendations (in short):

• Debt transparency
• Better maturity matching
• Balance revenues and costs
• Prioritise investment projects and beware of white elephants
• Reject pro-cyclical fiscal policies

How can African governments mobilise additional tax revenue in support of an inclusive development agenda? Improved tax revenue performance goes hand-in-hand with broader development of the economy. A well-designed tax system can support a structural transformation process that includes job creation and higher incomes. Conversely, poor tax system design can tilt this process towards generating low-paid jobs.

In order to ensure that social protection programmes can be sustained over time, with less dependence on aid, this report recommends a systematic approach to tax design reform. While heterogeneity between African countries, both in terms of administrative structure and fiscal capacity, means that tax policy advice must be highly contextualised, there are a number of lessons to be learnt from past successes and mistakes.

Africa’s countries have agreed to form the world's largest free trade area, the African Continental Free Trade Area (AfCFTA). The purpose is to create a single market by eliminating trade and labour barriers. This is expected to increase trade both within Africa and with other regions. However, past trade reforms have not been very successful. Moreover, the effects of the AfCFTA may vary greatly from country to country due to differences in political will, capacity and economic structure. The key to making it work is to facilitate trade and reduce non-tariff trade barriers, while taking into account the diversified political and economic context.

Afrikanska länder söder om Sahara har de senaste två decennierna haft en relativt god ekonomisk tillväxt. Även om andelen fattiga i befolkningen minskade från 56 procent till 36 procent mellan åren 2000 och 2022, kommer emellertid fler än hälften av Afrikas länder misslyckas med att nå målet att halvera fattigdomen till 2030. I den här artikeln diskuterar vi hur den ekonomiska tillväxten kan bli mer fattigdomsinriktad. I stora drag handlar det om grundläggande faktorer som ökad produktivitet och investeringar i humankapital och realkapital, vilket i kombination med väl fungerande institutioner kan påskynda Afrikas strukturomvandling. Men Afrikas 54 länder har olika förutsättningar att lyckas.  

Background: Gender disparities in access to inputs, markets, financial inclusion, and participation in strategic value chains are major developmental challenges in emerging economies. Participation in the edible insect value chain has become an essential source of income, food, and nutrition in some African countries. This paper uses a bivariate probit model to examine the gender differentials for primary mopane worm harvesters' participation in primary processing and market participation during COVID-19 in South-Eastern Zimbabwe. Using a structured questionnaire, the data was gathered from 393 primary harvesters in five purposively selected wards in the Gwanda District of Zimbabwe. This study examines the gender differentials for primary mopane worm harvesters' participation in primary processing and market participation during COVID-19 in south-Eastern Zimbabwe.

Results: Results show that women are likelier to participate in primary value addition to preparing for the lean season opportunities. There are gender differentials in the participation in markets during COVID-19. Results show a significant negative relationship between participants' ages and female engagement in mopane processing and a positive correlation with female involvement in lean COVID-19 season marketing. Male harvesters' participation in the lean market during the COVID-19 pandemic was significantly correlated positively with age and education level, while the choice to participate in the lean market was negatively correlated with the dependency ratio.

Conclusions: Collaborative, community-centric, and gender-accommodative development of the mopane worm value chain is important. Focal issues are on supporting primary value addition for lean season market participation and during market shocks such as COVID-19. This can be a leap towards gender equality and improving livelihoods of women and men in mopane harvesting areas. The study recommends marketing and district-specific policies explicitly addressing mopane worm harvesting and marketing affects market participation and primary value-addition decisions.

This paper evaluates the effects of the government's COVID-19 economic stimulus and relief package (emergency/one-off income grant of ND750) on household food security in Namibia during the period of the lockdown. The analysis reveals that a household that received the income grant ($42 equivalent) experienced about 11%−17% reduction in food insecurity compared to their non-recipient counterparts. We also found that the effect was relatively higher in female-headed households than in male-headed households. The positive effect is supported by a higher proportion (53%) of the beneficiary households who were satisfied with the policy. These findings underscore the need for the government of Namibia to institutionalise and sustain the income grant policy as a safety net and extend it to cover other vulnerable households in the post-pandemic. Such a programme should be gender-responsive and targeted at household heads who make decision over food consumption and other household arrangements for a bigger impact.

Measuring sustainability at farm level is a priority for both research and policy and requires sustainability indicators to track progress. Indicators make the sustainability concept more concrete and guide farm level decisions, playing a decisive role in determining food system impacts on societies and the environment. Data availability is often a limiting factor when choosing indicators, but not enough attention is paid to the role of data in indicator construction and assessment results. This paper assessed the critical role of data in indicator construction and the potential limitations that current data availability imposes on farm-level sustainability assessments, using the example of dairy farms in Sweden. To do so we used a five-step approach consisting of a literature review, an inventory of data sources, an expert consultation, a matching and gap analysis, and a critical assessment. We found that 20 indicators categorized under 12 out of 20 sustainability themes had measurement issues due to missing scope, temporary data, or additional data requirements. At least some indicators were measurable within all themes in the social and economic dimensions while all indicators for pesticides, non-renewable energy, and soil quality in the environmental dimension had measurement issues. In the critical assessment, we argue that for some indicators, there are trade-offs between data availability and issues of comprehensibility and analytical validity. Furthermore, we found that no single data source could be used to measure all themes; which means that merging of different data sets is needed for a broader on-farm sustainability assessment. Our findings are relevant for the discussion on sustainability indicators and will inform future programs aimed at collecting sustainability data at farm level, which should consider the broad data needs identified and the potential to merge data to enable holistic sustainability assessments.

In this report, the challenges and opportunities arising from the growing ties between two key “Rising Powers,” China and India, and Africa are more fully explored. This trend has given rise to speculative, exaggerated and ideological responses and a mixture of anxiety and hope. What is needed is an interdisciplinary political economy study to investigate the ways in which global, regional and national linkages in the relationship impact on the prospects of sustainable development in Africa. The necessity for this is underscored by the growing influence of the BRICS group (Brazil, Russia, India, China and South Africa) in reshaping the world.In this frame, the focus is on the nature of the shift in China’s and India’s strategic vision of Africa in terms of politics, ideology and economic development. This shift impinges on trade and investment and, in turn, the scope for inducing structural economic change in the context of colonial and postcolonial tensions. Comparative observation of countries in Eastern and Southern Africa, particularly Ethiopia in the former, illustrates their capacity to cope with the new powers. This is a critical aspect of the continent’s complex interplay with states and institutions within and beyond its borders. Ultimately, African nations have to individually and collectively confront the challenges and opportunities stemming from their evolving relationships with these Rising Powers.

Micro, Small and Medium frms’ credit access remains a dilemma though the fnancial sector has been liberalized. This paper investigates the factors infuencing credit rationing and how variations in the characteristics of frms owned by diferent genders contribute to credit rationing. The study utilizes probit estimation with marginal efects, Fairlie counterfactual and decomposition analysis to analyze both credit rationing and the extent to which the credit rationing gap is infuenced by diferences in gender endowments and discrimination using 1,430 frms’ owners’ loan applications randomly selected from eight (8) commercial banks. Our results show that borrowers having more years of experience, external market access, proximity to lender, being older and being male are not likely to experience credit rationing. Borrowers in the agricultural sector, with long term loans, who lack formal education, run labor-intensive frms, have joint ownership, and operate small businesses face the probability of being credit rationed. A decomposition and counterfactual analysis reveal a credit rationing gap largely infuenced by discrimination favoring male owned frms rather than diferences in gender endowments. Our fndings have implications for policy.

This article discusses barriers to women’s economic empowerment and opportunities for households headed by women to diversify incomes in the rural parts of Kenya. The study analyzes the full range of income-generating activities at the household level and also accounts for the different types of female-headed households, each of which face different constraints. The findings show that not only do female-headed households diversify and combine their incomes differently than male-headed households but also that there are differences among different groups of female-headed households.