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31. Fiscal Policy Letter No5: Improving Financial Inclusion To Broaden The Tax Base In Cameroon

Author:
Jean-Cedric Kouam and L.B. Bongbinsin
Publication Date:
07-2021
Content Type:
Working Paper
Institution:
The Nkafu Policy Institute
Abstract:
For several months, Cameroon has been facing the ravages of the pandemic caused by the coronavirus. To stop the spread of the virus, the Cameroonian authorities in April 2020 announced a series of fiscal easing measures to help companies and households in difficulty. Estimated at more than 114 billion CFA francs according to the Director-General of Taxation, the decisions taken have profoundly impacted public finances. Indeed, well before the pandemic, the country was already facing a high risk of external debt overhang (IMF, 2018) and immense security challenges in the North and the Anglophone regions. Despite this constraining socioeconomic and political context, the state must find the necessary and sufficient resources to ensure its proper functioning and territorial integrity. This fiscal policy letter proposes through analyzes a way for the government of Cameroon to increase its tax revenues in the coming years without penalizing growth: improving financial inclusion. The goal is to eliminate all constraints that exclude the most disadvantaged from full participation in the financial sector. The letter is structured around six key points. First, we provide an overview of Cameroon’s financial inclusion situation. Second, we analyze the factors that explain economic agents’ access to financial services, the transmission mechanisms between the financial and formal sectors, and the barriers to financial inclusion in Cameroon. Our results show that a deepening of the financial system would likely positively affect tax mobilization in Cameroon. Estimates show that a 10% increase in financial assets would lead to a 1.87% increase in tax revenue, equivalent to CFAF 49.70 billion – based on the level of tax revenue projected in the 2021 budget law. Similarly, a 10% increase in the number of secure servers – better access to the internet – would lead to a 1.1% increase in tax revenue, equivalent to CFAF 30.62 billion. This improvement in access to financial services for all economic agents – households, businesses – requires the public authorities to make the current regulations more flexible and increase the banking network’s density. This includes the development of payment systems, the construction of quality infrastructures, the definition of mechanisms to limit massive illicit capital flight, and the multiplication of consumer/investor protection guarantees.
Topic:
Development, Infrastructure, Governance, Finance, and Tax Systems
Political Geography:
Africa and Cameroon

32. Youth Participation In the Local Development Plan In Yaoundé 4: Issues and Roles

Author:
Sonwa Momo Berenice Kylian
Publication Date:
08-2021
Content Type:
Working Paper
Institution:
The Nkafu Policy Institute
Abstract:
Africa is a continent with a predominantly young population. The media and development experts around the world speak of it as a great wealth. Cameroon is one of those countries whose youth is the “driving force”. Lawn°2004/017of 22 July 2004 on the orientation of decentralisation in Cameroon, taken up by Law n°2019/024 of 24 December 2019 on the General Code of Decentralised Territorial Authorities, is quite explicit on the contribution of the population, and in particular young people, to their local development. For the voice of these young people to have a large-scale impact, coordination is needed. In this respect, youth organisations (associations) are likely to provide relevant solutions. This is the case of PIJEDECA (Independent Youth Platform for Democracy and Active Citizenship), which has been working for nearly five (5) years in mobilising youth around social, economic, democracy, citizenship and human rights issues. The ADEV (Association of Development Actors), for its part, “has been working for more than three years with women and young people in Cameroon society. “ From the outset, it is necessary to indicate what an association is in order to identify its role and its challenges in local development. Article 2 of Law No. 90/053 of 19 December 1990 on the freedom of association in the Republic of Cameroon provides that “association is the agreement by which persons pool their knowledge or activities for a purpose other than sharing profits”. This shows that the association has a collective function and does not aim at individual interest. It is in this pooling of skills that youth associations can effectively contribute to the development of their Decentralized Territorial Authorities (CTD). For the Confederation of Youth Organisations (COJ), “”a voluntary association of natural or legal persons that contributes to the development by young people of their personal skills in order to help them become active, responsible and critical citizens within society”. ». These organisations must be supported by young people who are committed to the development of a community, a territory, without neglecting the great contribution of volunteering. Several studies have been carried out on the contribution of young people to the development of their communities both in Cameroon and abroad. This is why it is important to specify the roles and issues of these youth associations in the commune of Yaoundé 4. In view of the above, what could be the roles and stakes of youth organisations in the development of Yaoundé 4? To answer this question is certainly to seek to establish a direct link between the civic commitment of these youth associations and their contribution to the development of Yaoundé 4.
Topic:
Development, Youth, Local, Participation, and Civic Engagement
Political Geography:
Africa and Cameroon

33. Free Trade as an Anchor for Sustainable Development

Author:
Sundjo Fabien and Sunjo Tata
Publication Date:
12-2021
Content Type:
Working Paper
Institution:
The Nkafu Policy Institute
Abstract:
Does trade enhance or jeopardize sustainable development? This brief answers this question by debunking the myth that protectionism is a driver of sustainable development. It then outlines the ways in which free trade can lead to sustainable development. This brief finds that free trade is a boon for GDP growth, value chains, and better productivity. It will equally lead countries to specialize and become more competitive. This brief pithily finds that free trade will anchor sustainable development if countries synchronize trade facilitation measures and lower non-tariff barriers such as indiscriminate checks at land borders.
Topic:
Development, International Trade and Finance, Sustainable Development Goals, Free Trade, and Sustainability
Political Geography:
Africa

34. Crime, inequality and subsidized housing: evidence from South Africa

Author:
Roxana Elena Manea, Patrizio Piraino, and Martina Viarengo
Publication Date:
05-2021
Content Type:
Working Paper
Institution:
Centre for Trade and Economic Integration, The Graduate Institute (IHEID)
Abstract:
We study the relationship between housing inequality and crime in South Africa. We create a novel panel dataset combining information on crimes at the police station level with census data. We find that housing inequality explains a significant share of the variation in both property and violent crimes, net of spillover effects, time and district fixed effects. An increase of one standard deviation in housing inequality explains between 9 and 13 percent of crime increases. Additionally, we suggest that a prominent post-apartheid housing program for low-income South Africans helped to reduce inequality and violent crimes. Together, these findings suggest the important role that equality in housing conditions can play in the reduction of crime in an emerging economy context.
Topic:
Crime, Development, Inequality, and Housing
Political Geography:
Africa and South Africa

35. A Contextual Analysis of Green Micro, Small and Medium Enterprises/Local Green Enterprises in Uganda

Author:
Advocates Coalition for Development and Environment (ACODE)
Publication Date:
12-2021
Content Type:
Working Paper
Institution:
Advocates Coalition for Development and Environment (ACODE)
Abstract:
The Micro, Small and Medium Enterprises (MSMEs) dominate Uganda's economy. They play a pivotal role in production and supply chains, value addition, technology transfer, development and innovation. MSMEs, underpin the country's competitiveness, employment, income and wealth creation and if greened and well harnessed, they have a big potential to facilitate transitioning to an inclusive transformative growth trajectory.The report contributes to a better understanding of the sustainable financial architecture and how it affects the activities and priorities of LGEs in Uganda. It is hoped that the report will guide informed discussions at local and national levels and feed into the development of sustainable finance policy instruments, laws, support systems and standards that improve investment climate for LGEs and consequently promote the greening of MSMEs.
Topic:
Development, Economy, Green Technology, and Green Transition
Political Geography:
Uganda and Africa

36. Oil and Capital Flight: The Case of Angola

Author:
Nicholas Shaxson
Publication Date:
01-2021
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
Angola’s “paradox of plenty,” as a country with rich resources and poor development outcomes, makes it ideal for the study of capital flight. With the fifth largest economy in sub-Saharan Africa, the country is known not for what it has done with its vast natural resource endowment, but what it has failed to do with it. The country features prominently in the literature on the ‘resource curse,' as the discovery and exploitation of petroleum has suffocated the development of other economic sectors while profiting the national elite and its foreign partners. This has been accomplished notably through establishment of a powerful parastatal to manage oil, Sonangol, which observers have described as “an island of competence” yet has been instrumental to wealth extraction. Angola’s oil and diamonds also played a critical role in motivating and financing the country’s prolonged and devastating civil war.
Topic:
Development, Oil, Political Economy, Natural Resources, Conflict, and Capital Flight
Political Geography:
Africa and Angola

37. South Africa: When Strong Institutions and Massive Inequalities Collide

Author:
Brian Levy, Alan Hirsch, Vinothan Naidoo, and Musa Nxele
Publication Date:
03-2021
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
South Africa's economic and social imbalances can no longer be swept under the rug. The country has three choices: muddle through, endure another surge of ethnopopulism, or pursue inclusive development. South Africa was one of the 1990s iconic cases of democratization. Yet starting in the mid-2000s, the country began to experience a disruptive collision between its strong political institutions and massive economic inequality. The collision intensified across the 2010s, resulting in economic stagnation and increasing threats to institutional integrity. Understanding why this collision occurred and worsened over time is relevant not just for other middle-income countries but also many higher-income democracies wrestling with similar tensions between a declining tolerance for high or rising inequality and institutions that seemed strong in the past but find their legitimacy increasingly being questioned. Ideally, ideas, institutions, and growth all reinforce one another in a virtuous developmental spiral. Ideas offer hope by encouraging cooperation and the pursuit of opportunities for win-win gains. Institutions assure that the bargains underpinning cooperation will be monitored and enforced. Together, ideas and institutions provide credible commitment, which fuels economic growth. However, such a benign scenario does not reckon with the ways in which persistent high inequality, accompanied by unresolved tensions between the distribution of economic and political power, can both put pressure on institutions and quickly change hope into anger. The result can be a cascading set of pressures and an accelerating downward spiral. For the first fifteen years of democracy, South Africa enjoyed the advantages of both effective institutions and a shared willingness of stakeholders believed in the power of cooperation. This enabled the country to move beyond counterproductive conflict and pursue win-win outcomes. Growth began to accelerate, which created new opportunities for expanding the middle class. Increased fiscal space made it possible to broaden access to public services and to social grants, which reduced absolute poverty. There were, however, some stark limitations in what was achieved. Gains for the poorest did little to alter their difficult economic and social realities. Less than a quarter of the total population, including essentially all white South Africans, enjoyed a standard of living that was middle class or better. There was ample reason for the majority of South Africans to feel that, notwithstanding the promises of mutual benefit, the deck remained stacked against them. This increased the vulnerability of South Africa’s political settlement.
Topic:
Development, Inequality, and Institutions
Political Geography:
South Africa and Africa

38. Mainstreaming Climate Change in the National Budget: Memorandum of Issues from the Review of the Budget Framework Paper FY2021/2022

Author:
Advocates Coalition for Development and Environment
Publication Date:
03-2021
Content Type:
Working Paper
Institution:
Advocates Coalition for Development and Environment (ACODE)
Abstract:
This policy memorandum analyses the extent to which climate change is integrated in the Uganda National Budget Framework Paper for Financial Year 2021/2022. This will inform policy and the final budgetary appropriations for climate change interventions in key National Development Plan III Programmes.
Topic:
Climate Change, Development, Environment, and Budget
Political Geography:
Uganda and Africa

39. Establishing the empirical basis for tracing the development outcomes of agricultural investments

Author:
Helle Munk Ravnborg, Bernard Bashaasha, Rikke Broegaard, Michael Byaruhanga, Evelyne Lazaro, Festo Maro, Khamaldin Mutabazi, Teddy Nakanwagi, and David Tumusiime
Publication Date:
04-2021
Content Type:
Working Paper
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
This DIIS Working Paper describes the design of a questionnaire survey developed and implemented in order to trace the development outcomes of foreign agricultural investments in six research locations in Tanzania and Uganda. The questionnaire survey was conducted as part of the Agricultural Investors as Development Actors (henceforward AIDA) research programme which, in particular, focuses on development outcomes in terms of employment, migration, food security and wider dynamic economic effects, such as access to technology, infrastructure and markets; land markets and perceived security of land tenure; and water access and security of tenure. The working paper which serves as a methodological reference document describes the approach which was employed for drawing six independent samples of 400 respondents each, as well as the approach developed for computing a foreign agricultural investment exposure index and for computing a locally informed household poverty index.
Topic:
Agriculture, Climate Change, Development, Economics, Emerging Markets, Environment, Poverty, Water, Food, Governance, Inequality, Investment, and Land Rights
Political Geography:
Sub-Saharan Africa and Africa

40. Eliminating child marriage in Ethiopia

Author:
Fana Gebresenbet
Publication Date:
06-2021
Content Type:
Working Paper
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
How can we explain the large gap between national legal and policy commitments to reduce and eliminate gender-based violence (GBV) and the reality and practice of GBV in Ethiopia? Hitherto explanations mainly centre on the conflict between and social and official norms, and the stubbornness of the former. In this new DIIS Working Paper, Fana Gebresenbet tries to go beyond this dichotomy to examine what happens in the ‘in-between spaces’. While the stubbornness of social norms only brings home to us the slow pace of change, it does not tell us what guides the emerging practices that contribute towards change. Instead, ‘practical norms’ are used here as an analytical tool to examine what happens as we move along the continuum from social to official norms. This helps us capture why routinised, coordinated and socially acceptable new practices occur before the major social norms change. This work is part of GLOW (Global Norms and Violence Against Women in Ethiopia), a research programme financed by the Danish Ministry of Foreign Affairs and coordinated by DIIS.
Topic:
Development, Diplomacy, International Organization, Poverty, Children, Women, and Inequality
Political Geography:
Africa and Ethiopia