Growth

This paper explores the changing power capabilities of Algeria, Egypt, Ethiopia, Nigeria, and South Africa (the ‘Big Five’) over the next 25 years. Of these countries, Ethiopia and Nigeria are forecast to increase their power capabilities, whereas Algeria, Egypt and South Africa are expected to stagnate or decline. Of the Big Five, two currently punch above their weight – one that is rising, Ethiopia, and another whose growth is stagnant, South Africa. If Nigeria were able to take the necessary steps that would see far-reaching changes to the governance issues and social challenges that currently beset the country, it could become Africa’s lone superpower.

Using updated population forecasts, this paper presents alternative growth scenarios for South Africa up to 2035, and their implications for employment, politics and poverty. ‘Bafana Bafana Redux’ is the expected current trajectory. This scenario takes into account the impact of policy incoherence and the electricity supply crisis on South Africa’s long-term prospects. With concerted effort and much greater focus, an improved future, dubbed 'Mandela Magic Lite’, is possible – but neither scenario has a significant impact on structural unemployment. South Africa will only achieve long-term stability and prosperity with a leadership committed to inclusive political and economic practices.

Africa is at a tipping point in 2016. Despite all the success the continent has achieved in recent years, new and old dangers—economic, political, and security-related—threaten to derail its progress. With sound policymaking, effective leadership, and enough foresight, however—Africa can meet and defeat these challenges as well as the many more to come.

In this year's Foresight Africa, the Africa Growth Initiative and its colleagues discuss six overarching themes that place Africa at this tipping point and give their view on what they perceive to be key areas for intervention to keep Africa on its current rising trajectory. This year's format is different from years past, encompassing viewpoints from high-level policymakers, academics, and practitioners, as well as utilizing visuals to better illustrate the paths behind and now in front of Africa.

The Global Risks Report 2016 features perspectives from nearly 750 experts on the perceived impact and likelihood of 29 prevalent global risks over a 10-year timeframe. The risks are divided into five categories: economic, environmental, geopolitical, societal and technological.

The report also examines the interconnections among the risks, and through that analysis explores three areas where global risks have the greatest potential to impact society. These are the concept of the “(dis)empowered citizen”, the impact of climate change on food security, and the potential of pandemics to threaten social cohesion.

The report also takes an in-depth look at the how the global security landscape could evolve in the future; sharing the outcomes of a year-long study to examine current trends and possible driving forces for the future of international security.

This book addresses the rising productivity gap between the global frontier and other firms, and identifies a number of structural impediments constraining business start-ups, knowledge diffusion and resource allocation (such as barriers to up-scaling and relatively high rates of skill mismatch).

Analysis based on micro and industry-level data highlights the importance of reallocation-friendly policies, including well-functioning product, labour and risk capital markets, efficient judicial systems, bankruptcy laws that do not excessively penalise failure, housing policies that do not unduly restrict labour mobility, and improvements in public funding and organisation of basic research which do not excessively favour applied vs basic research and incumbents vs young firms.

The present Report offers ideas on how to shape the forthcoming period of Community support beyond the year 2020. The analysis builds on the report “The future of Cohesion policy – Report I” which reflected on the challenges and developments at the local and regional level, focusing mainly on the efficiency and effectiveness of implementing Cohesion Policy (CP). The present Report looks at concepts and models of CP (mainly its territorial dimension) and points out the main current challenges that are most likely to shape the future economic, social and territorial structures.

This second Report in the study series offers ideas on the future of CP. It is structured around two main parts, the first on models of growth, cohesion and well-being, and the second on new ideas and choices for EU CP. Thus projections and assumptions – in particular in the third section of the Report – are of a long-term nature. The present Report largely builds on an extensive desk research including a comparative literature review as well as relevant analyses and reports carried out by the authors of this paper. In addition, the analysis is fed by the results of an online survey carried out with stakeholders who took part in the seminars on the future of CP. Finally, independent interviews were carried out with relevant stakeholders with deep insight and considerable experience in the field of CP.

Although African trade flows are accelerating at a healthy rate, most African governments have struggled to diversify their economies and to achieve inclusive, sustainable growth. “As Africans, we should be proud of our recent economic growth performance,” noted African Union (AU) Commissioner for Trade and Industry Fatima Haram Acyl in 2014, “but there should be no room for complacency.”
Increased trade could transform the African continent, which is home to thirty-three of the world’s least developed countries (LDCs) and accounted for only 3 percent of global trade in 2014. African nations that have implemented reforms supporting the free movement of goods, capital, and people have reaped a substantial development dividend and are ranked among the fastest growing economies in the world.
This report examines the current state of trade in Africa, identifies obstacles hindering economic diversification and growth, and offers policy recommendations based on these findings. It addresses the economic and geopolitical implications of the global collapse of commodity demand and China’s recent slowdown, as well as how regional trade agreements and regional economic communities (RECs) offer better opportunities for African economies to unlock growth.

This Agenda is a plan of action for people, planet and prosperity. It also seeks to strengthen universal peace in larger freedom. We recognise that eradicating poverty in all its forms and dimensions, including extreme poverty, is the greatest global challenge and an indispensable requirement for sustainable development. All countries and all stakeholders, acting in collaborative partnership, will implement this plan. We are resolved to free the human race from the tyranny of poverty and want and to heal and secure our planet. We are determined to take the bold and transformative steps which are urgently needed to shift the world onto a sustainable and resilient path. As we embark on this collective journey, we pledge that no one will be left behind. The 17 Sustainable Development Goals and 169 targets which we are announcing today demonstrate the scale and ambition of this new universal Agenda. They seek to build on the Millennium Development Goals and complete what these did not achieve. They seek to realize the human rights of all and to achieve gender equality and the empowerment of all women and girls. They are integrated and indivisible and balance the three dimensions of sustainable development: the economic, social and environmental.

While California’s four-year drought is forcing the most severe mandatory water restrictions in the state’s history, another water crisis is brewing that will affect far more people and a much greater territory – the planet at large.

According to a global study by the International Food Policy Research Institute and Veolia, the world is on a path toward rapidly deteriorating water quality in many countries. The first-of-its-kind study indicates that up to 1 in 3 people will be exposed to a high risk of water pollution in 2050 from increased amounts of nitrogen and phosphorous. Up to 1 in 5 people will be exposed to a high risk of water pollution reflected by increased levels of biochemical oxygen demand (BOD).

Even using the most optimistic socio-economic models, water quality is projected to rapidly deteriorate over the next several decades which, in turn, will increase risks to human health, economic development and thousands of aquatic ecosystems in developed and developing economies alike.

After a surge in prosperity over the past decade fueled by rising oil prices, Saudi Arabia’s economy is at an inflection point. We see a real opportunity for the country to inject new dynamism into its economy through a productivity- and investment-led transformation that could help ensure future growth, employment, and prosperity. In a new McKinsey Global Institute report, Saudi Arabia beyond oil: The investment and productivity transformation, we discuss how the country has significant opportunities to transform its economy to become more sustainable and less dependent on oil. Among our findings:

- The oil price boom from 2003 to 2013 fueled rising prosperity in Saudi Arabia, which became the world’s 19th-largest economy. GDP doubled, household income rose by 75 percent, and 1.7 million jobs were created, including jobs for a growing number of Saudi women. The government invested heavily in education, health, and infrastructure and built up reserves amounting to almost 100 percent of GDP in 2014.
- The country can no longer rely on oil revenue and public spending for growth, in the face of a changing global energy market and a demographic transition that will significantly increase the number of working-age Saudis by 2030. The current labor participation rate is 41 percent, and productivity growth of 0.8 percent annually from 2003 to 2013 trailed many emerging economies.
- Our model integrating Saudi Arabia’s economic, labor-market, and fiscal perspectives shows that even if the country responds to these challenging conditions with policy changes such as a budget freeze or immigration curbs, unemployment will rise rapidly, household income will fall, and the fiscal position of the national government will deteriorate sharply.
- However, a productivity-led economic transformation could enable Saudi Arabia to double its GDP again and create as many as six million new jobs by 2030 (exhibit). We estimate this would require about $4 trillion in investment. Eight sectors—mining and metals, petrochemicals, manufacturing, retail and wholesale trade, tourism and hospitality, healthcare, finance, and construction—have the potential to generate more than 60 percent of this growth opportunity.