Economic Growth In Sub-Saharan Africa Research Articles

Intervention Options for Enhancing Smallholder Compliance with Regulatory and Market Standards for High-Value Fruits and Vegetables in Rwanda and Zambia

Agriculture is vital for economic growth in sub-Saharan Africa. In Rwanda and Zambia, the sector drives economic output, particularly the horticulture sector, which has emerged as a significant contributor to export revenue and employment for resource-poor rural communities. As agri-food value chains become globally connected, there are increasing concerns about food safety and both the social and environmental sustainability benefits of production, which has underscored the need for producers to comply with certain regulatory standards. This paper uses a value chain analysis approach to assess the factors influencing compliance among smallholder fresh fruit and vegetable (FFV) producers in Zambia and Rwanda, and identify practices essential for achieving widespread compliance, to enhance the competitiveness of the sector. The data were gathered from 340 FFV farmers and key informants using structured questionnaires. The results reveal that the value chains for target FFVs are still traditional, predominantly targeting local markets. These markets pose low barriers to entry for smallholders, and often with few safety and quality requirements. As such, there remains a paucity of understanding of market needs and regarding quality and safety standards amongst smallholders, which, coupled with low-input, low-technology farming methods, and inadequate pre- and post-harvest handling, limit the market potential. To bridge these gaps, this study recommends organising farmers into legally recognised entities, to enable access to compliance information, reduce transaction costs, and provide access to high-quality niche markets through public–private partnerships. Countries also need to develop industry codes of practice and quality management systems and support farmers to adhere to them.

On the fiscal deficit and economic growth in sub-Saharan Africa: A new evidence from system GMM.

Using a two-step approach GMM, this study examines the short- and long-term effects of fiscal deficit on the economic growth of 42 Sub-Saharan African nations between 2011 and 2021. The World Development Index, the most reliable source, is where the panel data is taken from. Using the Levin-Lin-Chu and Hadri LM tests for unit root, it was determined that there is no risk of a random walk in the data. The study's findings indicate that while the fiscal deficit has short-term, positive, and significant benefits on the economic growth of SSA countries, it has long-term, negative repercussions. According to the system GMM's results, an increase in the fiscal deficit of SSA countries is linked to a short-term increase in economic growth of 0.036 percent, while an increase in the fiscal deficit of one percentage point is linked to a long-term decline in economic growth of SSA countries of 0.013 percent, holding all other factors constant. The study's findings also showed that the budget deficit has a larger positive short-run coefficient than a negative long-run coefficient. The study also revealed that while real effective exchange rates and inflation short-term hinder economic growth, gross fixed capital creation and real interest rates are the primary drivers of economic expansion. Long-term economic growth in the SSA countries is also found to be positively and significantly impacted by gross fixed capital formation. According to the study, SSA nations should manage their fiscal deficits and, in the long run, provide more funds for gross fixed capital development.

The Non-linear effect of Inflation on Economic Growth in Sub-Saharan Africa: Does Democracy Matter?

The Non-linear effect of Inflation on Economic Growth in Sub-Saharan Africa: Does Democracy Matter?

Factor Productivity nexus Economic Growth in Sub-Saharan Africa: Symmetric and Asymmetric Panel Approaches

This study examines the effect and role of total factor productivity with other major determinants on economic growth in the Sub – Saharan Africa(SSA) It employs the data obtained from the World Bank Development Indicators spanning from 1990 to 2022 using panel ARDL, GMM and their extended asymmetric non-linear (NARDL) and (NGMM) models. The NARDL and NGMM are more superior to the counterpart ARDL and GMM symmetric models in the long-run than the short-run estimation, ensuring more efficient and reliable information regarding the effects of productivity on economic growth analysis. Finally, the robust dynamic inter-temporal Granger causality tests show that asymmetrically there is bi-directional causality between the growth rate of an upward movement in total factor productivity and real GDP. There is also bi-directional causality of a downward movement in the growth rate of the terms of trade and real GDP growth rate. The empirical findings of the study are extremely important indicators for sustained economic growth in the SSA region. Hence, this research work recommends that governments should enhance total factor productivity and terms of trade through job-trainning provision and promote trading among themselves as policy tools.

Towards economic growth in Sub-Saharan Africa: is there a synergy between insurance market development and ICT diffusion?

ABSTRACT This study contributes to the literature by investigating the intervening role of information and communication technology (ICT) diffusion on insurance and economic growth in Sub-Saharan Africa (SSA). This study uses the generalized method of moments technique based on 36 countries, spanning 2007–2020. First, the empirical findings reveal that insurance penetration (i.e. total, life and nonlife) and ICT diffusion induce economic growth in SSA. Second, the evidence suggests that ICT boosts the role of insurance in affecting economic growth. Third, the individual ICT variables such as fixed broadband, telephone and internet propel the impact of total and life penetration on growth. Additionally, fixed broadband was remarkable in enhancing the effect of nonlife penetration on growth. The findings imply that though insurance enhances economic growth, its impact is more revealing through the intervening role of ICT infrastructure. Therefore, insurers must embrace technology and leverage ICT development to improve their performance on growth.

Financial globalization, governance and economic growth in Sub-Saharan Africa

Purpose The study aims to assess the interplay between financial globalization, effective governance and economic growth in sub-Saharan African (SSA) economies. Design/methodology/approach This study uses the Generalized Method of Moment Estimation and the Panel Quantile Regression techniques to analyze how financial globalization and governance impact sub-Saharan African economies. Findings The results show that governance is vital to the region's economic development. In order to achieve significant growth, sub-Saharan African economies must prioritize actions that promote good governance. Research limitations/implications The study is limited to sub-Saharan African economies. Practical implications It is crucial for the sub-Saharan Africa economies to concentrate on strengthening governance frameworks in order to realize its full economic potential because improvements in governance quality would have a favorable effect on economic growth. Social implications The findings indicate that both capital inflows and governance dynamics are essential for fostering economic growth in SSA economies. Also, balancing globalization's benefits with effective governance is crucial for promoting sustainable growth in SSA. Originality/value This paper fills a gap in literature by using the KOF financial globalization index to assess the impact of financial globalization and governance on economic growth in sub-Saharan African economies.

Public institutions and infrastructure: the interactive effect on economic growth in sub-Saharan Africa

Public institutions and infrastructure: the interactive effect on economic growth in sub-Saharan Africa

Volatile capital flows and economic growth in sub-Saharan Africa: the role of transparency

Volatile capital flows and economic growth in sub-Saharan Africa: the role of transparency

Harmonizing renewable energy and economic growth in Sub-Saharan Africa: the transformative potential of ICT

Harmonizing renewable energy and economic growth in Sub-Saharan Africa: the transformative potential of ICT

Investment Uncertainties and Economic Growth in Sub-Saharan Africa

Abstract This study investigated the effect of uncertainties, segmented into macroeconomic and political components, on investment in sub-Saharan Africa, with thirty-one countries represented. The analyses were further nuanced to trace the investment-growth link within this set of countries. Two investment types—private and foreign direct—were covered in separate analyses. The sample of countries was chosen through stratified sampling to include oil-exporting, other resource-intensive, and nonresource-endowed countries. The Jorgenson investment model, which explicitly incorporates uncertainty into the investment decision-making process using adaptive and extrapolative approaches, was adopted for the study, and augmented with the partial adjustment model to address the assumption that the user cost of capital adjusts instantaneously. For the two investment types considered, the impartial contract and foreign investment model and the country risk and private investment model were adopted, respectively. The two-way system generalized method of moments technique was employed for estimation. The results showed that foreign direct investment (FDI) in oil-exporting and other resource-intensive countries was only sensitive to macroeconomic uncertainty, while FDI in nonresource-intensive countries was vulnerable to both macroeconomic and political uncertainties. This finding strengthens the belief that, regardless of political instability, natural resources are a major attraction for foreign investors in sub-Saharan Africa. Finally, the study revealed that private investment in the resource-intensive region was primarily affected by macroeconomic uncertainty, whereas its political vulnerability was mainly observed in the oil-exporting and nonresource-intensive regions. To mitigate investment uncertainties in sub-Saharan Africa, it is crucial to focus on minimizing the volatility of interconnected price variables, requiring collaborative efforts.

How Is Institutional Quality Moderating the Effect of Terrorism on International Tourism, Trade, Foreign Aid Inflow and Economic Growth in Sub-Saharan Africa?

This study examines how international tourism, foreign aid inflow, international trade and economic growth are responding to terrorism in Sub-Saharan Africa (SSA), and how institutions are moderating these interactions. To answer these questions, we examined a panel of 40 SSA countries for the period 2010–2020 based on the system generalised method of moments framework. Our results revealed that: (a) terrorism impacts adversely on tourism, foreign aid inflow, trade and overall economic growth in SSA; and (b) institutional quality has not been effective in mitigating the adverse effects of terrorism on tourism, foreign aid inflow, trade and economic growth in SSA. Policy implications are discussed. JEL Codes: C33; F10; F35; F43; L83; N20

On the government revenue on economic growth of Sub-Saharan Africa: Does institutional quality matter?

As studies report inconclusive results, the linkage between government revenue and economic growth remains a topic of debate in economic literature. This study investigates the effect of government revenue on the economic growth of Sub-Saharan African countries with the main objective of whether institutional quality matters. The panel data for 43 SSA countries were obtained from dependable data sources: World Development Indicator and Heritage Economic Freedom Index for the period of 2012–2022. The result from system GMM estimation reveals that government revenue adversely affects economic growth while institutional quality positively enhances economic growth before interacting with each other. However, the interactive coefficient of government revenue and economic growth positively affected the real GDP growth rate of SSA countries over the study periods. Precisely, before interacting with institutional quality, a percentage change in government revenue, keeping all other things constant, leads to a 0.0866% decline in economic growth while it marks a 0.2329% upsurge in economic growth in the presence of institutional quality. The result of the study further revealed that government revenue promotes the economic growth of the region when combined with institutional quality. On the other hand, foreign direct investment and openness to trade were the key sources of economic growth whereas the population growth rate adversely impacted economic growth in SSA countries during the study period under consideration. The policy implication of the study is that SSA needs to strengthen government revenue management. Further, the finding of the study implies that SSA countries need to improve institutional quality through promoting efficiency of the regulatory quality and the size of the SSA governments. In addition to this, the fast real GDP growth rate of SSA countries demands improved institutional quality indicators such as the rule of law and extended access to the open market.

The impact of unemployment on economic growth in Sub-Saharan Africa

The impact of unemployment on economic growth in Sub-Saharan Africa

The contribution of health outcomes and nutrition to economic growth in Sub-Saharan Africa

The contribution of health outcomes and nutrition to economic growth in Sub-Saharan Africa

Gender disparity in access to education, under-5 mortality, and economic growth in sub-Saharan Africa.

This paper empirically analyses the impact of gender disparity in access to education and under 5 mortality on economic growth in selected sub-Saharan African (SSA) countries from the period 2005 - 2020. The study engaged a panel data of 17 selected SSA countries sourced from the World Development Indicators (WDI) and the United Nations Institute for Statistics (UNIS) and applied the instrumental variable generalised method of moments analytical approach. The result shows that the interaction between gender parity in access to education and primary school enrolment has a significant impact on economic growth. The study concludes that policies to promote gender parity in access to education would be of paramount importance to increase economic growth towards the actualisation of sustainable development goal related to inclusive and equitable quality education and the promotion of lifelong learning opportunities (SDG4) in SSA countries.

Effect of Unemployment, Inflation and Foreign Direct Investment on Economic Growth in Sub-Saharan Africa

Effect of Unemployment, Inflation and Foreign Direct Investment on Economic Growth in Sub-Saharan Africa

Effect of government revenue on economic growth of sub-Saharan Africa: Does institutional quality matter?

Following the approval of sustainable development goals at the global level, the link between fiscal policy, institutional quality, and economic growth has attracted special attention in economic literature. This study scrutinizes the effect of government revenue-institutional quality interaction on the economic growth of 43 Sub-Saharan Africa countries for the period of 2012-2022. Methodology-wise, the study employed the System Generalized Method of Moment (SGMM) to analyze the panel data gained from dependable data sources; the World Development Indicator and the Heritage Economic Freedom Index. The novelty of this study emanates from the estimation technique designated and the introduction of revenue-institutional quality into the economic growth model of SSA. The result of the study reveals that government revenue adversely affects economic growth while institutional quality positively enhances economic growth before interacting with each other. However, the interactive coefficient of government revenue and economic growth positively affected the real GDP growth rate of SSA countries over the study periods. Precisely, before interacting with institutional quality, a percentage change in government revenue, keeping all other things constant, leads to a 0.0866 percent decline in economic growth while it marks a 0.2329 percent upsurge in economic growth in the presence of institutional quality. The result of the study further shows that government revenue promotes the economic growth of the region when combined with institutional quality. On the other hand, foreign direct investment and openness to trade were the key sources of economic growth whereas the population growth rate adversely impacted economic growth in SSA countries. The policy implication of the study is that SSA needs to strengthen government revenue management. Further, the finding of the study implies that SSA countries need to improve institutional quality through promoting efficiency of the regulatory quality and the size of the SSA governments. In addition to this, the fast real GDP growth rate of SSA countries demands improved institutional quality indicators such as the rule of law and extended access to the open market.

Fiscal policy and economic growth in Sub-Saharan Africa: Do governance indicators matter?

This study investigated the linkage between fiscal policy-governance indicators interaction and economic growth in 36 Sub-Saharan Africa (SSA) countries from the periods of 2011-2021 inclusive. The study employed two-step system Generalized Method of Moment (GMM) estimation technique due to its practical relevance in panel data analysis. The data obtained from World Bank and World governance indicator was checked for unit root through the help of Im Pesaran Shin and Levin-Lin-Chu unit-root tests, and the result revealed that data was stationary and safe for further analysis. The result of the study also presented that direct economic effect of fiscal policy is negative and significant in SSA countries. However, the interaction of fiscal policy with governance indicators has positive and significant effect on economic growth. Accordingly, before interacting with governance indicators, a percentage change in fiscal policy leads to a 0.20 percent decline in economic growth of SSA countries. Contrary to this, the interactive coefficient of fiscal policy and government effectiveness (0.019) and interactive coefficient of fiscal policy and corruption control (0.0046) are found to be positive and significant. Further, the finding of the study revealed that fiscal policy-voice and accountability interaction coefficient (0.011) and interactive coefficient of fiscal policy-regulatory qualities (0.014) are positively and significantly affecting economic growth of SSA countries. The policy implication is that policy makers in SSA countries should encourage economic policies that improve government effectiveness, strong corruption control, clean public services and better regulatory qualities.

Does Financial Development in Relation to Remittances influence Economic Growth in Sub-Saharan Africa?

Abstract This study investigates the influence of financial development on the relationship between remittances and economic growth within the Sub-Saharan Africa region. The study utilised panel data encompassing 42 countries, spanning the time frame 1980 to 2021. The research employed a cross-sectional augmented panel unit root test, as well as the Im-Pesaran-Shin unit-root test, to conduct the unit root analysis. The regression estimations employed the Pooled Mean Group and Mean Group/ARDL methodologies. The research findings demonstrate a significant association between the development of financial systems and sustained economic growth over an extended period. The findings from the empirical analysis indicate that there exists a substitutive relationship between financial development and the association between remittances and economic growth. The study proposes that it would be advantageous for financial policies in the Sub-Saharan Africa (SSA) region to give priority to the implementation of efficient financial reforms with the goal of improving the overall depth of the financial sector. Keywords: Remittances, Financial development, ARDL, Economic growth, Sub-Saharan Africa.

Impact of Export Diversification on Economic Growth in Sub-Saharan Africa (SSA)

This study investigated the impact of export diversification on the economic growth of countries in Sub-Saharan African (SSA). Trade Data are gathered from the World Integrated Trade Solution (WITS), and UN Comtrade database, using a 6-digit level range of the Standard International Trade Classification (SITC) and the Harmonised System (HS) for the Countries. Export diversification Indices data are proxies from the Herfindahl Hirschman Index (HHI) which represents the level of export product diversification for all forty-eight (48) SSA Countries between 1995 and 2020. The Panel Autoregressive Distributed Lagged Model (P-ARDL) was applied in the study. Other analysis including correlation analysis, multicollinearity, and Unit Root tests were used to achieve the objective of the study. The findings showed that export diversification has not really benefitted the SSA Countries; also, exporting raw materials and other primary products does not benefit the region, and therefore, the countries should continue leveraging on the potential of diversifying their exports and exploring sectors such as the manufacturing to attain more economic gains. To achieve export gains, oil/minerals products should be exported as finished products, not as raw materials, especially, from those nations that are resources endowed. These raw materials should be best used domestically to aid production into finished/refined products for subsequent exports.