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1. Leveraging 4IR for Governance and Urban Development in Johannesburg

Author:
Mmabatho Mongae
Publication Date:
02-2025
Content Type:
Policy Brief
Institution:
Good Governance Africa (GGA)
Abstract:
Johannesburg’s ability to harness the transformative potential of the Fourth Industrial Revolution is hindered by persistent governance and administrative weaknesses. While the city scores well for service delivery and economic development, its poor rankings in planning, leadership, and administration on the Governance Performance Index suggest challenges in execution and institutional efficiency. While Johannesburg has demonstrated foresight in adopting 4IR policies – such as the Smart City Strategy – these efforts risk being undermined if governance bottlenecks remain unaddressed. This briefing highlights the critical role of strong leadership and efficient administration in ensuring that 4IR-driven initiatives do not exacerbate inequality, but instead respond to Johannesburg’s urban challenges. To maximize the benefits of 4IR, Johannesburg must strengthen governance structures, improve policy coordination, and foster equitable implementation, ensuring that technological advancements enhance service delivery, economic growth, and urban resilience for all residents.
Topic:
Governance, Economic Growth, Fourth Industrial Revolution, and Urban Development
Political Geography:
Africa, South Africa, and Johannesburg

2. Ghana’s Pathway to AI Governance and Its Implications for Africa

Author:
Thompson Gyedu Kwarkye
Publication Date:
04-2025
Content Type:
Policy Brief
Institution:
Centre for International Governance Innovation (CIGI)
Abstract:
Artificial intelligence (AI) is transforming various sectors, offering the opportunity for economic growth and societal progress in Africa. However, it poses several risks that may disproportionately impact the continent. African countries are developing governance frameworks to navigate these concerns. Ghana’s 10-year National Artificial Intelligence Strategy emphasizes innovation, talent development and addressing AI-related risks through ethical and regulatory frameworks. It integrates several ethical dimensions to provide a test case for others on the continent. African governments must adopt a more human-centric governance approach, invest in local talent and foster inclusive AI development to avoid technological dependency while mitigating AI risks and maximizing its benefits. The dominance of AI by major technology companies highlights disparities between the more prosperous and resource-poor African countries. Bridging these gaps is crucial to ensuring that Africa can influence the future trajectory of AI development.
Topic:
Development, Governance, Economic Growth, and Artificial Intelligence
Political Geography:
Africa and Ghana

3. Carbon taxation and firm behaviour in emerging economies: Evidence from South Africa

Author:
Johannes Gallé, Rodrigo Oliveira, Daniel Overbeck, Nadine Riedel, and Edson Severnini
Publication Date:
05-2025
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper provides the first comprehensive analysis of how firms in emerging economies respond to carbon taxation, leveraging detailed administrative data from South Africa—a potential trailblazer for other developing countries with limited state capacity amid the growing global push for carbon pricing. We examine the dynamic impacts of the carbon tax on firm-level outcomes—such as profits, sales, capital, and labour inputs—across manufacturing and mining firms, which are key sectors in the context of the carbon tax. Contrary to concerns that carbon taxes may hinder economic growth or reduce employment, our findings show no evidence of negative average impacts on firm performance or jobs. However, this overall result masks significant heterogeneity in the tax’s effects across sectors, driven by the sector-specific design elements of the South African carbon tax. Firms expecting higher effective tax rates may have intensified their use of emission-intensive machinery and depreciated capital in anticipation of the tax. This behaviour appears to stem from firms resolving regulatory uncertainty or seeking to recover costs from stranded assets.
Topic:
Employment, Economic Growth, Carbon Tax, and Emerging Economies
Political Geography:
Africa and South Africa

4. Reversing the resource curse: Advancing good natural resource governance for inclusive growth and sustainable development in Southern Africa

Author:
Sikhululekile Mashingaidze and Stephen Buchanan-Clarke
Publication Date:
02-2024
Content Type:
Special Report
Institution:
Good Governance Africa (GGA)
Abstract:
The International Energy Agency’s Medium-Term Gas Outlook in late 2023 notes that “Africa accounted for nearly 40% of new natural gas discoveries globally in the past decade, mainly in Mozambique, Mauritania, Senegal and Tanzania. However, socio-political instability and security issues make Africa a high-risk environment for the gas industry. This results in a gap between the potential and the actual gas production projects under development.” Nonetheless, the Agency forecasts natural gas production growth of 10% (higher than current levels) by 2026. It had only grown by 2.5% from 2011 to 2021, and currently accounts for roughly 6% of global production.1 Asian and Middle Eastern markets’ demand will continue2 while African governments will bet on Liquefied Natural Gas (LNG). In the longer term, it is critical to phase out fossil fuels due to their exacerbation of global warming and health and environmental risks. Given the imperative for lowercarbon growth trajectories, demand for oil, gas, and coal will likely peak in 2024. Governments and mining investors’ negotiations and contracts should safeguard local populations through ecologically sensitive, responsible mining. Communities’ voices are critical to decision-making from project inception to ensure revenues usher in broad-based growth and increased domestic energy security. In 2022, Good Governance Africa (GGA), with support from the Southern Africa Trust (SAT), explored critical issues surrounding LNG exploration and development in Southern Africa in the context of climate change.3 This intelligence report is a consolidation of key lessons from these LNG projects’ impact on local communities in Mozambique’s Cabo Delgado; South Africa’s Eastern Cape, and Zimbabwe’s Cabora Bassa Basin. Together, these three cases illustrate both the promise and perils of LNG mining in Africa.
Topic:
Development, Natural Resources, Economic Growth, Sustainability, and Inclusion
Political Geography:
Africa and South Africa

5. Climate change prioritization in low-income and developing countries

Author:
Amin Mohseni-Cheraghlou and Henry Evans
Publication Date:
01-2024
Content Type:
Policy Brief
Institution:
Atlantic Council
Abstract:
The World Bank’s 2023 document Evolving the World Bank Group’s Mission, Operations, and Resources: A Roadmap, otherwise known as the “evolution roadmap,” sets a laudable goal to shift more focus and action onto climate change in low-income and developing countries (LIDCs). The language used throughout the report clearly reflects the Bank’s shifting priorities. The word “climate” was mentioned forty times in the evolution roadmap document, “poverty” was mentioned forty-two times, and prosperity was mentioned only twenty-one times. This shows a clear paradigm shift that is expanding from the World Bank’s “Twin Goals” of ending extreme poverty and boosting shared prosperity to also include issues related to climate change and financing. In the evolution roadmap report, the World Bank Group (WBG) rightly identifies that the world has not only stalled, but regressed in achieving the prosperity and development goals set for this decade. Further, the WBG identifies that LIDCs are not prepared to face the development challenges of the modern world. One of the key development issues the WBG identifies is climate change, which has an outsized impact on LIDCs. In this regard, the WBG has already created frameworks to engage climate issues in LIDCs. The WBG’s Country Climate and Development Reports (CCDR) offer a comprehensive resource to support development and climate objectives at the country level. These public reports empower governments, private sector investors, and citizens to prioritize resilience and adaptation and reduce emissions without compromising broader development objectives. These goals can be achieved, the WBG estimates, with an investment averaging 1.4 percent of a given country’s gross domestic product (GDP)— though in some low-income countries that number can be between 5 percent and 10 percent. While the CCDR gives nations the tools to achieve climate objectives without significantly compromising development, it does not bridge the gap between the increasing focus of the WBG and the developed world on climate change and the real priorities of LIDCs.
Topic:
Climate Change, Developing World, Economy, Economic Growth, Inclusion, and Prioritization
Political Geography:
Africa, Indo-Pacific, and Americas

6. Place-based Policies and Household Wealth in Africa

Author:
Matthew Amalitinga Abagna, Cecília Hornok, and Alina Mulyukova
Publication Date:
02-2024
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
This paper provides empirical evidence on the impact of a prominent place-based policy - Special Economic Zones (SEZs) - on the economic well-being of African households. We compile a novel dataset on repeated cross-sections of households living in various distance bands around SEZs in 10 African countries over the period of 1990 to 2020. Exploiting time variation in SEZ establishment, the estimation yields that households in the vicinity of SEZs become significantly wealthier compared to the national average after SEZs are established. The effect is most pronounced for households within 10 km and decays rapidly with distance. We show that this result is not driven by the residential sorting of wealthier households in SEZ neighbourhoods. The rise in wealth is strongest towards the middle of the wealth distribution and goes hand in hand with increased access to household utilities, higher consumption of durable goods, higher levels of education, and a shift away from agricultural activities - patterns that we interpret as indicative of an urbanization trend and the strengthening of the middle class.
Topic:
Migration, Economic Growth, Special Economic Zones, Labor Market, Wealth, Opportunity, and Household Income
Political Geography:
Africa

7. Optimal Investments in Africa’s Road Network

Author:
Sebastian Krantz
Publication Date:
07-2024
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
This paper characterizes economically optimal investments into Africa's road network in partial and general equilibrium - based on a detailed topography of the network, road construction costs, frictions in cross-border trading, and economic geography. Drawing from data on 144 million trans-continental routes, it first assesses local and global network efficiency and market access. It then derives a large network connecting 447 cities and 52 ports along the fastest routes, devises an algorithm to propose new links, analyzes the quality of existing links, and estimates link-level construction/upgrading costs. Subsequently, it computes market-access-maximizing investments in partial equilibrium and conducts cost-benefit analysis for individual links and several investment packages. Using a spatial economic model and global optimization over the space of networks, it finally elicits welfare-maximizing investments in spatial equilibrium. Findings imply that cross-border frictions and trade elasticities significantly shape optimal road investments. Reducing frictions yields the greatest benefits, followed by road upgrades and new construction. Sequencing matters, as reduced frictions generally increase investment returns. Returns to upgrading key links are large, even under frictions.
Topic:
Emerging Markets, Globalization, International Trade and Finance, Infrastructure, Economic Growth, Investment, and Roads
Political Geography:
Africa

8. Promoting the Implementation of the African Continental Free Trade Area (AfCFTA) in Cameroon

Author:
Nkafu Policy Institute
Publication Date:
12-2024
Content Type:
Working Paper
Institution:
The Nkafu Policy Institute
Abstract:
The African Continental Free Trade Area (AfCFTA) represents a transformative opportunity for African nations, aiming to establish a unified continental market for goods and services, enhance intra-African trade, and promote economic growth and development. As Cameroon embarks on this ambitious journey, it is essential to acknowledge the significant role that trade plays in our national development strategy. This report, titled “The Next Decade: Leveraging Trade for Cameroon’s Development,” serves as a comprehensive exploration of the policies, strategies, and partnerships necessary to fully harness the potential of the AfCFTA. In the coming decade, Cameroon has the opportunity to establish itself as a regional leader in trade and economic integration. This report emphasizes the significance of public-private partnerships and foreign direct investment as essential components in achieving this objective. By analyzing successful case studies from other countries, we can extract valuable lessons that will guide our approach to effectively implementing the African Continental Free Trade Area (AfCFTA). Our commitment to strengthening infrastructure, enhancing regulatory frameworks, and promoting local industries will be crucial in creating a favorable environment for trade and investment. As we move forward, it is imperative that all stakeholders—government, private sector, civil society, and academia—collaborate to create a unified strategy that aligns with our national development objectives. Together, we can unlock the immense potential of the African Continental Free Trade Area (AfCFTA), driving sustainable economic growth and improving the livelihoods of all Cameroonians. This report serves as a call to action for all of us to actively engage in shaping the future of trade in Cameroon. Let us seize this moment and work collectively towards a prosperous and integrated African economy.
Topic:
Economic Growth, Free Trade, Regional Economy, and African Continental Free Trade Area (AfCFTA)
Political Geography:
Africa

9. Macro-financial implications of public debt in South Africa: The role of financial regimes

Author:
Theshne Kisten
Publication Date:
06-2023
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper examines the role of financial frictions in the public debt–growth nexus, documenting that a public debt shock has different macro-financial implications dependent on the state of financial markets in South Africa. A non-linear vector autoregression model is estimated which allows the transmission mechanism to be characterized by two distinct financial regimes: stressful versus normal. The empirical results suggest that a public debt shock has a broadly insignificant impact on economic growth over the full sample, reflecting the ineffectiveness of government borrowing in stimulating the economy, and could suggest that the high and growing debt service costs faced by the government reduces funds available for investment purposes. Debt shocks are found to be deflationary in both regimes, lending support to the precautionary savings effect and the existence of a well-developed financial market, while interest rates decline with the immediate impact being moderately larger in the stress regime, providing evidence of the accommodative stance between fiscal policy and monetary policy. In response to a public debt shock, financial conditions show an immediate and transitory improvement in the high-stress regime; however, in the low-stress regime there is an immediate yet negligible improvement in financial conditions. Lastly, the responses evolve over time, with fiscal policy being less effective in stimulating the economy in the post-crisis period, but it has been effective in reducing financial stress in the high-stress regime.
Topic:
Economics, Finance, Economic Growth, and Public Debt
Political Geography:
Africa and South Africa

10. Absolute or relative: perceptions of inequality among young adults in Mozambique

Author:
Giulia Barletta, Ines A. Ferreira, and Vincenzo Salvucci
Publication Date:
02-2023
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Different concepts of inequality lead to different positions in discussions about whether economic growth leads to increasing inequality. This study investigates how over 1,100 young adults in Mozambique perceive inequality and whether their perceptions are based on relative or absolute terms. It follows the line of work which examines attitudes (perceptions and preferences) towards different distributional axioms, and focuses on scale and translation invariance. Most of our respondents believe that inequality in their neighbourhood is too high and that circumstances beyond their control explain why some people are poor. We conclude that, while some respondents think in absolute terms, many do not agree with either the scale-invariance or the translation-invariance axioms, and there is great variation depending on the scenario presented to the respondents. We find some correlation between their way of thinking and gender, but no clear link with level of education and type of employment.
Topic:
Education, Inequality, Economic Growth, Youth, and Gender
Political Geography:
Africa and Mozambique