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CGD in the News

The Economic Case for Wiping Out Ebola (Bloomberg Businessweek)

8/25/14

On Aug. 22, the World Health Organization announced a draft strategy to combat the West African Ebola outbreak over the next six to nine months. That’s a sign that the global health body isn’t optimistic about a rapid end to an epidemic that has killed around 1,300 people so far. An extended outbreak of such a feared disease would have mounting economic costs: Already quarantines and concerns for worker safety have delayed mining projects and slowed rubber and palm oil output in Liberia, as well as cocoa, peanut, and rice production in Sierra Leone. Ebola helps illustrate the economic burden of infectious disease—particularly on countries in the developing world, but with affects felt worldwide. All of which suggests why increased support to fight infection in developing countries would have considerable global economic benefit.

Earthquakes Cost More in Rich Countries but Devastate Poor Ones (Bloomberg Businessweek)

8/25/14

Northern California suffered its strongest earthquake in 25 years on Sunday, and although 120 people were injured, not a single fatality was reported. Meanwhile, the U.S. Geological Survey put initial estimates of economic losses at $1 billion. Both the low human cost and high economic cost illustrate constants in natural disasters: They are far more expensive—and far less deadly—in rich countries.

Earthquakes are more expensive in rich areas because there’s more to break. A barrel containing $16,000 worth of pinot noir, for example, fell and smashed at Dahl Vineyards on Sunday. North America accounted for one out of six global catastrophes in 2013, according to an analysis by insurance firm Swiss Re. But it accounted for only 1 percent of the victims, compared with as much as 23 percent of the economic loss. (Perhaps of most interest to an insurance company: It accounted for 42 percent of the insured losses worldwide.)

Meet Arvind Subramanian, the Man Who Could Be India’s Next Chief Economic Adviser (Wall Street Journal)

8/22/14

Economist Arvind Subramanian is the front-runner to become chief economic adviser to India’s finance ministry, a hotly anticipated appointment for the country’s new government given its pledges to tame inflation and kickstart the economy.

He isn’t likely to harbor any illusions about the profound obstacles that stand in the government’s way.

Mr. Subramanian—a fellow at the Peterson Institute for International Economics and at the Center for Global Development, both of them in Washington—previously worked for the International Monetary Fund. He was assistant director of its research department and the fund’s resident representative in Cairo. He has also taught at Harvard University and Johns Hopkins. Early in his career, he worked at the General Agreement on Tariffs and Trade, during the Uruguay Round of trade talks in the late 1980s and early ’90s. (That particular experience could come in handy amid India’s current tussle with the GATT’s successor body, the World Trade Organization.)

His academic work has focused on trade and its effects on developing countries. His writings on India’s economic emergence since the 1980s have tried to deepen simplistic conventional narratives. In a 2005 paper written with economist Dani Rodrik, he argued that the real catalysts of the country’s recent decades of fast growth came a decade before 1991 reforms that liberalized investment and production.

India Poised to Appoint Arvind Subramanian as Economic Adviser (Financial Times)

8/22/14

US-based economist Arvind Subramanian is poised to become chief economic adviser to the government of prime minister Narendra Modi, in a move likely to be welcomed by those pushing India to adopt a fresh round of market-oriented political reforms.

A widely respect thinker in trade and development economics, Mr Subramanian would take over a position that has been unfilled since the departure of Raghuram Rajan to head India’s central bank last year.

If appointed, Mr Subramanian would become the most senior economist in India’s government at a crucial moment of policy development, as Mr Modi plans potentially controversial reforms in areas ranging from taxation to labour market regulations.

A Clearing in the Trees (The Economist)

8/21/14

In a new study* for the Centre for Global Development (CGD), a Washington think-tank, Jonah Busch and Kalifi Ferretti-Gallon look at 117 cases of deforestation round the world. They find that two of the influences most closely correlated with the loss of forests are population and proximity to cities (the third is proximity to roads). 

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Frances Seymour of the CGD says this may be one reason why Brazil has quieted the chainsaws and Indonesia has not: democracy in Brazil began earlier and has gone further. Since Indonesia banned new logging and plantation concessions in primary forest in 2011, deforestation has actually risen. Land concessions continue to be issued by the Forestry Ministry, rated the most corrupt among 20 government institutions by Indonesia’s Corruption Eradication Commission in 2012. Some within government are hostile to anti-deforestation schemes, which they see as “foreign”, says Ade Wahyudi of Katadata, an Indonesian firm of analysts. Perhaps the biggest problem is the lack of a single, unified map including all information on land tenure and forest licensing: efforts to create one have been slowed by unco-operative government ministries and difficulties created by overlapping land claims.

But in the longer term, says Ms Seymour, the link between democratisation and slowing deforestation gives reason for hope. In Brazil it was not until well after military rule ended that the voices calling for protection of the Amazon had grown loud enough that the government had to take heed. Luiz Inácio Lula da Silva, who was elected president in 2002, in the country’s fourth election after the end of dictatorship, made anti-deforestation a priority. Indonesia has just had its second free presidential election since the fall of Suharto and politicians across the spectrum say illegal logging must be eradicated (though so did Suharto’s successor).

 

Alza del Costo del Financiamiento Puede Atrasar Decisiones de Inversión (Gestión)

8/21/14

In this interview for Gestión, CGD senior fellow Liliana Rojas-Suarez talks about the world economy and the core issues deterring sustained economic growth in Peru.

La Economía de Estados Unidos se Recupera y la China se Complica (La Hora)

8/20/14

Liliana Rojas-Suarez discusses how monetary policy and growth prospects in the US, as well as the situation of the European and Chinese economies, affects Latin American countries.

How to Prevent the Next Ferguson (Bloomberg Businessweek)

8/18/14

The clash between police and citizens in Ferguson, Mo., highlights an American dilemma about law enforcement. After the Missouri State Highway Patrol took over policing on Thursday night, the streets of Ferguson became considerably more peaceful than they had been under the watch of St. Louis County police.

As the crisis has starkly illustrated, we’ve been increasing the power of every police force in terms of weapons, authority, impact, and indemnity. But the quality of policing hasn’t always kept up with the elevated power—nor has our ability to test and improve that quality. The U.S. should look to other countries for techniques of measuring police probity and foster reforms to strengthen the caliber of the nation’s law enforcement system.

Military-style SWAT teams were deployed 45,000 times across the U.S. last year, and thanks to Department of Defense donation programs, the police have access to ever more heavy equipment. Some 500 law enforcement agencies—including Ohio State University—are now proud owners of Mine Resistant Ambush Protected (MRAP) vehicles, for example. The enhanced weaponry has contributed to the increasing lethality of U.S. law enforcement: The FBI estimates that 410 people were killed by U.S. law enforcement officers in the line of duty in 2012. The same statistic for the U.K. is one person.

Africa’s Necessary Data Revolution (Project Syndicate)

8/13/14

Since the term “data revolution” was introduced, there has been a flurry of activity to define, develop, and implement an agenda to transform the collection, use, and distribution of development statistics. That makes sense. Assessing the international community’s next development agenda, regardless of its details, will be impossible without accurate data.

Yet, in Sub-Saharan Africa – the region with the most potential for progress under the forthcoming Sustainable Development Goals – accurate data are severely lacking. From 1990 to 2009, only one Sub-Saharan country had data on all 12 indicators established in 2000 by the Millennium Development Goals. Indeed, of the 60 countries with complete vital statistics, not one is in Africa. While most African countries have likely experienced economic growth during the last decade, the accuracy of the data on which growth estimates are based – not to mention data on inflation, food production, education, and vaccination rates – remains far from adequate.

US Anti-Coal Dominoes Hit BRICS Wall, Other Skeptics (Reuters)

8/13/14

U.S. officials have floated proposals at multilateral forums such as the G20 but have been rebuffed by Japan and Germany. U.S. Treasury officials have also discussed with China the role that public funds can play in developing less carbon-intensive energy sources.

Scott Morris, a former Treasury official for development finance, said the rapid change the United States has hoped for was never realistic.

"It's harder to be pure, whether on climate or any other issue, in the face of domestic commercial interest," said Morris, now a senior associate with the Washington, D.C., think tank Center for Global Development.

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