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Moss served as Deputy Assistant Secretary in the Bureau of African Affairs at the U.S. Department of State 2007-2008 while on leave from CGD. Previously, he has been a Lecturer at the London School of Economics (LSE) and worked at the World Bank, the Economist Intelligence Unit (EIU) and the Overseas Development Council. Moss is the author of numerous articles and books, including African Development: Making Sense of the Issues and Actors (2018) and Oil to Cash: Fighting the Resource Curse with Cash Transfers (2015). He holds a PhD from the University of London’s SOAS and a BA from Tufts University.
“An Aid-Institutions Paradox? Aid dependency and state building in sub-Saharan Africa,” with Nicolas van de Walle and Gunilla Pettersson, in William Easterly (ed.) Reinventing Aid, MIT Press, Cambridge, 2008.
“The Ghost of 0.7%: Origins and Relevance of the International Aid Target,” with Michael Clemens, International Journal of Development Issues, Vol. 6, No. 1, 2007.
“Compassionate Conservatives of Conservative Compassionates? US political parties and bilateral foreign assistance to Africa”, with Markus Goldstein, Journal of Development Studies, Vol. 24, No. 1, October 2005.
“Is Africa’s Skepticism of Foreign Capital Justified? Preliminary Evidence from Firm Survey Data in East Africa”, with Vijaya Ramachandran and Manju Kedia Shah, in Magnus Blomstrom, Edward Graham, and Theodore Moran (eds), Does a Foreign Direct Investment Promote Development?, Institute of International Economics, Washington DC, May 2005.
“Irrational Exuberance or Financial Foresight? The Political Logic of Stock Markets in Africa”, in Sam Mensah & Todd Moss (eds), African Emerging Markets: Contemporary Issues, Volume II, African Capital Markets Forum, Accra, 2004.
“Stock Markets in Africa: Emerging Lions or White Elephants?” with Charles Kenny, World Development, Vol. 26, No. 5, May 1998.
“Africa Policy Adrift,” with David Gordon, Mediterranean Quarterly, Vol. 7, No. 3, Summer 1996.
“US Policy and Democratisation in Africa: The Limits of Liberal Universalism,” The Journal of Modern African Studies, Vol. 33, No. 2, June 1995.
For years, the Overseas Private Investment Corporation (OPIC) has been attacked by a handful of organizations as corporate welfare. Most recently, the Heritage Foundation made this argument boldly and loudly when the U.S. Senate was first considering the Energize Africa Act, which was co-sponsored by Senators Menendez (D-NJ), Corker (R-TN), Coons (D-DE), Isakson (R-GA), Markey (D-MA), and Johanns (R-NE). Amongst other things, the legislation included a multi-year reauthorization for OPIC along with a number of reforms to make the agency more effective and accountable. In the end, the OPIC provisions were stripped from the bill and the pared down Electrify Africa Act was passed and signed into law. The saber rattling about OPIC as a boon for large American companies seemingly won the day.
But, were the charges of corporate welfare actually true? My colleague Todd Moss and I spent months looking at the data to get an answer, and here it is: no.
Analyzing the corporate welfare question has been an unnecessarily difficult exercise. Despite major improvements in OPIC’s transparency, there still is no single publicly available dataset that includes comprehensive information about the agency’s portfolio. Yes, OPIC has a searchable project dataset, but it only includes very basic information. Digging deeper requires clicking through hundreds of project descriptions (in PDF format), which very few people are willing to do. This is one reason why the argument by anecdote approach against OPIC has proved so effective over the years.
So along with our colleague Jared Kalow, we built a better dataset, the OPIC Scraped Portfolio dataset. Only after creating this detailed collection of nearly 1,500 OPIC projects over the past fifteen years, we are finally able to shed data-driven light on this debate. (For additional details, see our new CGD paper.) We’ll blog soon about our other major findings, along with the full dataset for public access.
On the corporate welfare critique, here’s what we found:
Between 2000 and 2014, Fortune 500 companies accounted for 30 percent of OPIC project commitments by value.
Two large US financial firms – Citibank and Wells Fargo – account for the vast majority of these Fortune 500-related projects, especially over the last five years.
Yet nearly every Citibank and Wells Fargo project (91 percent of related OPIC commitments) is specifically and solely focused on partnering with local banks in developing counties to increase the availability of capital for traditionally under-served segments (e.g., SMEs and microfinance institutions). In these projects, OPIC typically provides a partial loan guarantee for a limited period of time for demonstration effect purposes.
The U.S. government, and OPIC specifically, has promoted these facilities as a way of expanding economic opportunities and growth in the developing world. This has been especially true in the Middle East and Sub-Saharan Africa, where SMEs and microfinance institutions have very little access to bank lending. And looking at the project descriptions, it’s clear that Citibank or Wells Fargo would not move ahead without OPIC’s engagement, at least in the early stages.
Therefore, if we exclude SME and microfinance lending facilities, less than 8 percent of OPIC commitments over the last five years have involved Fortune 500 companies.
It’s too bad we had to build our own dataset to answer this question, but now we have it clearly: charges that OPIC is a boon to big US businesses are not true.
How much energy do the world’s poor need? The current definition of "modern energy access" sets an extremely low bar. A new CGD paper presents five recommendations for a new standard of energy access that would signify meaningful transformation in households and national economies.
Visit the report page for a full interactive version and video.
“Modern energy access” is finally on the international agenda, but the current common definition of 100 kilowatt-hours (kWh) per capita per year is far too low.
To reflect likely demand and historical trends would require measuring energy usage at higher levels, such as 300 and 1,500 kWh per capita per year.
The Overseas Private Investment Corporation (OPIC) is the US government's development finance institution. Balancing risks, financial needs, and development benefits is riven with numerous tensions, statutory restrictions, and tradeoffs. This raises an important policy question - how well does OPIC’s actual portfolio balance these competing goals? Since much data about the OPIC portfolio is unavailable in an accessible format, we built the OPIC Scraped Portfolio database to address this question.
The African Development Bank almost wasn’t. Twenty years ago, the Bank lost its crucial AAA credit rating and its future was very much in doubt. Yet now it is held up as one of the largest sources of infrastructure finance for the region, a multilateral financing institution owned by 53 African and 25 non-regional governments, akin to a regional World Bank. This turnaround was spearheaded by the then-President Omar Kabbaj who worked to tighten the ship and regain the lost AAA credit rating. And it speaks to the crucial role played by the person leading the AfDB.
Listen to this week's CGD Podcast, where Scott Morris discusses his take AfDB candidate short-list.
After Kabbaj’s rescue, the next phase was rebuilding, a task undertaken with vision and enthusiasm by former Rwandan finance minister Donald Kaberuka, who assumed the Presidency in 2005. Looking back, the task ahead was daunting. But the revival has been remarkable. The Bank’s portfolio shifted toward infrastructure and demand for Bank lending grew. Not only were the finances saved, but more importantly the Bank became a leader and voice for the continent. Kaberuka moved the AfDB from the policy and finance fringes to the center of Africa’s economic surge.
Akinwumi A. Adesina - Nigeria, Minister of Agriculture and Rural Development
Sufian Ahmed - Ethiopia, Minister of Finance and Economic Development
Jaloul Ayed - Tunisia, President, MED Confederation; former Minister of Finance
Kordjé Bedoumra - Chad, Minister of Finance and Budget
Cristina Duarte - Cape Verde, Minister of Finance and Planning
Samura M. W. Kamara - Sierra Leone, Minister of Foreign Affairs and International Cooperation
Thomas Z. Sakala - Zimbabwe, former VP Country and Regional Programs, AfDB
Birma Boubacar Sidibé - Mali, VP Operations, IsDB
Again showing the Bank’s global leadership, it is holding arguably the most open and competitive selection process of any multilateral development bank. In that spirit, here are five questions I hope shareholders ask the candidates, one of whom will have to steer the Bank into a new phase:
Where would you shift the Bank’s lending portfolio and why?
How should the Bank respond to the commodity price downturn?
What more would you do to help attract private capital to the continent and sustain recent high growth rates?
Does the Bank need additional capital and/or more shareholders? If yes, how would you do that?
How can the Bank make progress in the region’s fragile and conflict-affected environments?
Another question we’re really interested in is how the candidates intend to use the platform of the Presidency. Donald Kaberuka has been a major African voice on global issues including global health, food security, taxation—and especially Africa’s needs during the 08-09 crisis. Under his leadership, the AfDB has done a lot more than lend money. So what issues will his successor use the profile of the Presidency to promote?
In another encouraging sign of a truly competitive process, the field appears wide open. The voting system, whereby the lowest vote-getter is dropped in successive rounds, also allows for unpredictable outcomes. The onus is now on shareholders to ask hard questions and ensure that they select the very best candidate to take Kaberuka’s legacy forward—and hopefully the African Bank to the next level.
India’s Ministry of Finance recently released a whopper of an annual Economic Survey. Don’t let the boring title fool you: this is a magnum opus on contemporary development. (Full disclosure: the lead author is Chief Economic Advisor Arvind Subramanian, a friend and senior fellow on leave from CGD.) The Survey contains the usual detailed analysis of the Indian economy. Yet the parts of most interest to developmentistas are likely to be the special chapters on demonetization, low-skill manufacturing, fertility puzzles, urbanization, and more.
“Universal Basic Income: A Conversation With and Within the Mahatma” (Chapter 9) is the one that really caught my attention. It’s a thoughtful, cogent, and thorough discussion of the potential to replace India’s vast complex of subsidies and targeted in-kind benefits to the poor with a guaranteed cash transfer to all citizens. The idea of UBI is simple: instead of providing subsidies for fuel, free meals, and dozens of other welfare benefits, just deposit money directly into the bank account of every citizen to use as they see fit.
The Survey’s assessment begins with quotes from Mahatma Gandhi suggesting both support and objection to the principles of UBI. The chapter then methodically addresses the conceptual pros (e.g., justice, equity, agency, efficiency) and potential cons (e.g., labor disincentives, moral hazard, political objections). It attempts various modeling, including a rough estimate that cutting national poverty in half via UBI would cost just 1.5 percent of GDP, less than the subsidy bill in the 2016-17 budget. For the data nerds, there are seven (!) appendices explaining all the estimates and calculations.
Implications of the UBI and its effect on poverty and vulnerabilitySource: NSS 2011-21, Budget 2016-17, Survey Calculations
For followers of CGD’s Oil-to-Cash initiative, the survey also highlights the fascinating case of the state of Goa (page 297), where a 2012 judgement by the Supreme Court of India created the Goa Iron Ore Permanent Fund. A group of citizens, the Goenchi Mati Movement, are now fighting for the expansion of the fund and the distribution of cash dividends, akin to the Alaska Permanent Fund dividend, which pays out an equal share of half the five-year average earnings from the state’s sovereign wealth fund to each resident.
So, should India go for UBI or not? In the end, the Survey concludes, with its characteristic blend of charming caution and righteous audacity:
…UBI is a powerful idea whose time even if not ripe for implementation is ripe for serious discussion. One can easily imagine the Mahatma as fair mediator, deliberating and examining both sides of the argument carefully. The Mahatma as the embodiment of universal moral conscience would have seen the possibility of UBI in achieving the outcomes he so deeply cared about and fought for all his life. But the Mahatma as moralist would have had doubts because of seeing uncompensated rewards as harming responsibility and effort. As a fiscal conservative he would permit UBI only if convinced that macro-economic stability would not be jeopardized. Recognizing the difficulty of exit, the Mahatma as astute political observer would have anxieties about UBI as being just another add-on government programme. But on balance he may have given the go-ahead to the UBI.
Bill Easterly calls Moss's new introduction to Africa "compulsively readable and accessible" and "a masterpiece of clear thinking." Each chapter is organized around three fundamental questions: Where are we now? How did we get to this point? What are the current debates?
Power Africa has the potential to be transformative for millions of poor people and be the single biggest legacy in Africa for President Barack Obama. Observers now have roughly three years to reflect on the initiative: on what’s progressing well, what’s not, and where future risks may lie. While it is still too early to provide a complete analysis of outcomes, this report card provides a timely assessment at the close of this administration and an input to the next one. While the judgments of Power Africa are largely positive, the coming months will be crucial to keeping the effort on a positive trajectory.
Todd Moss, Caroline Lambert, and Stephanie Majerowicz offer a well-argued explanation of how oil-to-cash transfers could help countries overcome the corruption, economic volatility, and lack of government accountability that too often plague countries with rich resources but weak institutions.
It’s only a matter of time before Nigeria passes South Africa as the continent’s largest economy. At one level, this is an irrelevant technical exercise and I’m sure Morten Jerven will (rightly) point out that the numbers are all wrong.
But I also suspect this will be a watershed psychological moment. South Africa, and much of the world, seems to think of that country as the natural regional leader and representative in part because of the size of its economy (estimate from World Bank: $384 billion in current dollars). It is also, I suspect, because Johannesburg feels like a major modern commercial hub and Cape Town is one of the most wonderful cities to visit. Because of this implicit status, South Africa is usually given added stature at major international summits and invited to groups like the BRICS and G-20.
This no doubt grates at Nigerians, which also view their country (even while fully aware of their own shortcomings) as the natural leader for the continent. Lagos, by contrast, is booming but a very difficult city for foreign visitors. Disrespect from things like the portrayal of Nigerians in the South African sci-fi film District 9 adds fuel to the fire.
But Nigeria (GDP: $263 billion) has been catching up fast. But when will it pass South Africa? Using World Bank estimates and IMF projections, the answer is… 2028 (see figure). This makes sense given that Nigeria’s growth rate has been and is expected to remain more than double South Africa’s pace.
But here’s an interesting twist. Nigeria hasn’t rebased its GDP since 1990 and will soon release updated figures. Expectations are that the statistical update will boost the estimate of Nigerian GDP by about 40%. (Ghana’s 2010 rebasing resulted in a 63% jump.) That would mean Nigeria will be larger than South Africa in… 2018.
Here we are, deep in the throes of summer, which hopefully means you have finished your planned holiday books and are in need of another good read or two! But what should you choose? We asked CGD experts to share their recommendations. Check out the list below to find what fits your mood, whether that's a deep dive into migration policy, a surprising look into Machiavelli's life, or a techno-utopian, time-traveling adventure (I know what gets my vote!).
If you'd like to get more reading recommendations from CGD, you can also sign up for our weekly Friday "What We're Reading" newsletter.
"A love story set amidst the colonial evils of Dutch-ruled Indonesia. Transcribed from stories the author told his fellow inmates while a political prisoner in the 1970s, and beautifully translated. At once vivid historical fiction and haunting social commentary." – Jonah Busch
"This book makes the migration policy crisis comprehensible through the epic journalistic feat of personally accompanying one Syrian man from Egypt all the way to Sweden. If you have policy ideas about how to address the crisis, see if they survive reading Kingsley's deeply engaged account." – Michael Clemens
"Beckert explores the early stages of globalization and the industrial revolution through the lens of the cultivation, processing, and trade of cotton and cotton textiles. He also focuses on the links to the slave trade in the early days of the cotton trade, and the changing fortunes of India, China, and other developing countries as their roles in the 'cotton empire' shifted over the centuries." – Kimberly Ann Elliott
"I'm not normally a fan of sci-fi, so I wasn't expecting to get into this time-travel/alternate-reality book, but I did. In this novel, Tom Barren runs into a time-travel mishap when he leaves his techno-utopian, idealistic 2016 world of flying cars and moving sidewalks behind and changes history so that he ends up stranded in our 2016. Mastai's piece is a thought-provoking, funny, and entertaining novel that's a perfect read for any vacation." – Rebecca Forman
"Fictional short stories about people haunted by abrupt failure in the wake of rapid success. The most famous story concerns Lonesome Rhodes, who rises from itinerant Arkansas guitar picker to local media rabble-rouser to TV superstar and political king-maker. Whether you read the book or not, you must see the movie, A Face in the Crowd, directed by the amazingly talented Elia Kazan, which underscores the role of the media in electing our most prominent politicians and invites viewers to draw parallels to the current situation in the United States." – John Hurley
"Alexievech documents ordinary Russia after the fall of the Soviet Union and their experience with revolution, capitalism, and Putin. It reads less like a history book and more like an oral history—unassuming, frank, and raw. It's a fascinating investigation into modern Russia, and it contains all these insightful nuggets on democracy, capitalism, and revolution that are surprisingly relevant for American politics." – Jared Kalow
"A fascinating account of Machiavelli's life and lifelong struggle to restore Florence as a republic. He emerges as a more complex figure than you might think from reading The Prince—as interested in justice, freedom, and the rule of law as in power. On his deathbed, he is said to have claimed he'd rather be in hell with Plato, Plutarch, and Tacitus than in a heaven that banished them." – Nancy Lee
"The late-night TV host tells the stories of his childhood in the slums of Johannesburg where, being racially mixed, he belonged to no group. He finds his way through to his teenage years through tenacity, the unwavering support of his mother, and a preternatural sense of the absurdity of societal norms. It is a very funny and touching book. I listened to the book, rather than read it. Noah himself narrates and his theatrical vocal presence was the icing on the cake. Great for a long car trip!" – Mark Plant
"Haasse tells the remarkable story of Charles d'Orléans, a celebrated medieval French poet and prominent nobleman. Head of a family caught up in bitter dynastic strife at thirteen, English prisoner of war at twenty-one, Charles spends much of his life struggling against forces far beyond his control. And yet, even as his life's joys are snatched from him and his freedom denied for 25 years, the poet finds a way to live his life with dignity and grace. A stunning meditation on nothing less than the meaning of life itself, Haasse's work presents the vibrant, tumultuous world of the later Middle Ages with rare compassion and understanding." – Mallika Snyder
In the twelve months to June 2016, nearly 1.3 million Kenyan households were connected to the grid for the first time. This impressive feat pushed Kenya’s national electricity connectivity rate to 55 percent from just 27 percent in 2013, one of the fastest connection increases recorded in the region. These latest connections illustrate the Kenyan government’s commitment to a goal of achieving universal energy access by 2020 (at least as measured by number of connections by Kenya Power and Lighting Corporation (KPLC), the national utility that owns and operates most of the electricity transmission and distribution system).
This is impressive. The jump from 27 percent to 55 percent took Kenya a little over three years. That same achievement took the United States about eight years during the height of the push to expand household electrification.
Now, Kenya aims to move from 55 percent to a ‘near universal’ access rate of 95 percent in just four more years—a leap that took the United States nearly twenty-six years. Yes, the U.S. is larger in size and population, but Kenya’s ambitions are still tremendous. In order to reach its goal, Kenya aims to hit 6.5 million connected households by July 2017, their most ambitious annual connections target yet. As of the end of last month, they are just about halfway there and roughly on track.
All this highlights Kenya as an example of extremely fast progress in electrification. So, what is Kenya’s strategy?
Invest heavily: In 2015, the Kenyan government and KPLC announced the Last Mile Connectivity Project, an initiative to connect one million customers per year. The government has already secured over $600 million from various international donors, and aims to connect over 814,000 households, measured as four million Kenyans, over the next four years.
Promote ‘under grid’ connections: Many Kenyans continue to live ‘under the grid,’ meaning the grid infrastructure is near where they live, but they are not connected. In response, many of Kenya’s connectivity programs, including the Last Mile project, have made an effort to leverage existing infrastructure in order to connect nearby populations as quickly as possible. For example, Phase I of the Last Mile project is focused on connecting under grid households within 600 meters of existing KPLC transformers.
Address demand side constraints: Two major policy adjustments in the last year reflect the government’s awareness of demand-side barriers to access. The government reduced the connection charge by over 50 percent and offered customers the option to pay the charge in installments. KPLC also scrapped a cumbersome application process, which was evidently skewed in favor of literate and wealthier households.
Will Kenya reach 95 percent by 2020? Due to KPLC’s remarkable transparency on progress on household connections, we can follow along in nearly real-time. Check it out, here.