New paper: ‘Caveat emptor: the Graduation Approach, electronic payments and the potential pitfalls of financial inclusion’

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Paulo dos Santos and I recently published a piece in Policy in Focus 14 (2): 55-57. This is a publication by The International Policy Centre for Inclusive Growth. You can also read the piece on Developing Economics.

New article: Better than Cash, but Beware the Costs

Paulo dos Santos and I recently published Better than Cash, but Beware the Costs: Electronic Payments Systems and Financial Inclusion in Developing Economies in Development and Change. The article dissects and critically evaluates the assumptions behind the policies promoted by the Better Than Cash Alliance.

Here is the abstract:

This article considers current proposals for using electronic payments systems to promote financial inclusion — that is, to widen the availability of financial and monetary services in developing countries. While such systems can generate significant savings in the operation of monetary systems, payment services markets are typically uncompetitive and require regulatory and broader state interventions to ensure those savings are widely distributed. The use of those systems to broaden the reach of for-profit lenders raises a number of concerns, as a growing literature has documented how microcredit initiatives in developing countries have resulted primarily in expansions in consumption credit to households, often under predatory terms. The authors advance two original arguments in this connection. First, the perverse results of many microcredit initiatives reflect the underdevelopment of the areas concerned: without broader development strategies, potentially transformative productive projects are rare and unprofitable to finance. In contrast, widespread unmet consumption needs ensure consumption credit offers lenders a profitable alternative business orientation. Second, and in light of this, electronic payments platforms can contribute to economic development by enabling the establishment of well-regulated or public systems of electronic ‘narrow banks’ restricted from lending, but capable of widening access to affordable payments, savings and insurance services.

Report on Eurobonds in Sub-Saharan Africa

I recently published the report Bond to Happen? Recurring Debt Crises in Sub-Saharan Africa and the Rise of Sovereign Bond Issuance. The report assesses risks and opportunities associated with Eurobond issuance in sub-Saharan Africa. The case studies in the report expose a lack of accountability when it comes borrowing processes in a selection of sub-Saharan African countries. In fact, the process of bond issuance is often plagued by lack of transparency and ultimately legitimacy, from the perspective of the citizens of the issuing country. As this is playing out in the context of a defective framework for sovereign lending and borrowing and a flawed system for debt restructuring, issuing Eurobonds entails many serious risks.

Read some coverage of the report:

New article on Determinants of Borrowing Costs in Sub-Saharan Africa

A paper I wrote with Aleksandr Gevorkyan was recently published in the November 2016 issue of the Review of Development Economics.  The article is Assessing Recent Determinants of Borrowing Costs in Sub-Saharan Africa. Empirically the paper finds that sovereign bond yields are significantly influenced by global volatility, commodity prices and global liquidity—all factors that are out of the control of the sub-Saharan economies in question.

The research was picked up by UN News Centre and the Schwartz Center for Economic Policy Analysis, and we published op-eds on the findings on Interfima, Developing Economics, Chartered Institute of Development Finance, and Seeking Alpha.

Blog post: Why Isn’t The World Bank’s Choice of Chief Economist More Controversial?

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I wrote this piece for The New School Economic Review (NSER) blog.

Continue reading “Blog post: Why Isn’t The World Bank’s Choice of Chief Economist More Controversial?”

New book chapter: “The Changing Character of Financial Flows to Sub-Saharan Africa”

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Financial Deepening and Post-Crisis Development in Emerging Markets Current Perils and Future Dawns (ed. by Aleksandr V.Gevorkyan and Otaviano Canuto) was published recently. In it, I have a chapter on the changing character of financial flows to sub-Saharan Africa (pp. 223-245). Continue reading “New book chapter: “The Changing Character of Financial Flows to Sub-Saharan Africa””

Article in ‘Development Finance Agenda’

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An article I previously published on the blog RightingFinance has been re-published in Volume 2, Issue 1 (2016) of the journal Development Finance Agenda (DEFA), which is published by the Chartered Institute of Development Finance (CIDEF). You can read more about this issue here.