African Economies Research Articles

External debt and economic growth in selected African economies: A heterogeneous dynamic panel data analysis

The nexus between external debt and economic growth of Ghana, Kenya, Morocco, Nigeria, Rwanda, Tunisia and Zimbabwe from 1981 to 2021 was examined in this study. For analysis, the Pooled Mean Group Heterogeneous Dynamic Panel Data Approach and the Toda Yamamoto Granger causality tests technique were deployed. The results indicated that external debt had a negative effect on economic growth. Moreover, debt service exerted a positive impact on economic growth. The findings of the causality tests showed that there is no causal link between external debt and economic growth. Furthermore, no causal link was established between debt service and economic growth. As a result, the study suggests that the capacity of these economies in terms of revenue generation and debt servicing should be reinforced by their governments through the channelling of external debt into long-term productive investments for the realization of positive economic growth. Moreover, the policies on debt servicing in these economies should be sustained since it is yielding the desired results. Furthermore, thoroughly assessed projects of high significance should be the only yardstick for the contraction of foreign loans in these economies. Also, the policy objectives of external debt, debt service and economic growth can be pursued separately from one another in this group of economies in Africa.

International ownership and SMEs in Middle Eastern and African economies

AbstractEmpirical evidence on the benefits of international ownership for small and medium‐sized enterprises (SMEs) financial performance is either not available for most African and Middle Eastern countries or presents mixed results. In this paper, we investigate this further by examining the effects of ownership structure on firm performance, using financial data covering SMEs in 60 African and Middle Eastern countries, for the years 2006–2015. Results from pooled ordinary least squares and random‐effects estimations indicate that international ownership is significantly positively correlated with firm performance for (most of) Africa and the Middle East. Examining the interaction of international ownership with capital resources, we find that internationally owned firms do not use capital more efficiently than locally owned firms, implying that internationally owned firms use international resources—other than capital—more efficiently.

Reviews on the Strategies Employed in Implementing the 'Push-Pull' Approach to Integrated Pest Management

Abstract: For small-holder maize farmers in Africa, the push-pull strategy is outlined as an alternate ecological management technique to traditional insecticide-based integrated pest management for the control of the spotted stem borer Chilo partellus and the autumn armyworm Spodoptera frugiperda. Push-Pull Technology (abbreviated PPT) is a unique integrated pest management method developed by the International Centre of Insect Physiology and Ecology (ICIPE) and its partners. This tactic involves influencing the behavior of natural enemies and insect pests by strategically deploying stimuli that make the resource under protection unappealing or inappropriate for the pests (the "push"). Additionally, the pests are drawn to an alluring source the pull, from which they are then eliminated

Load Shedding and Its Crippling Effect on The South African Economy: An Entrepreneurial Perspective

The country has experienced industry shutdowns, decreased productivity, educational setbacks, increased unemployment rates, and negative healthcare outcomes. Load-shedding in South Africa is primarily caused by inadequate maintenance, internal mismanagement, corruption, and a lack of skills. This issue has had a significant impact on small businesses, as they often lack the necessary resources to handle power surges, equipment damage, and the costs associated with replacing stock. This paper explores how load-shedding has impacted the South African economy from an entrepreneurial perspective. The research is qualitative and exploratory in nature, and it was found that load-shedding has had a significant impact on businesses' finances, resources, and performance. Load-shedding in South Africa has had a severe impact on the daily lives of people, causing disruptions in businesses, households, and the overall economy. Eskom, the primary supplier of energy in South Africa, has been facing significant challenges in meeting the growing demand for electrical energy, leading to job losses, decreased productivity, and a loss of billions of rands. Small businesses have been particularly affected, with an estimated 75% of them failing after being operational for less than three years due to load-shedding. To ensure small businesses have electricity to operate during load-shedding it is recommended that small businesses adopt alternative energy sources like solar power to increase the businesses’ independence and mitigate the effects of load-shedding. The South African government should also encourage and support small businesses to collaborate with successful renewable energy companies.

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

PurposeThe study aims to assess the interplay between financial globalization, effective governance and economic growth in sub-Saharan African (SSA) economies.Design/methodology/approachThis 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.FindingsThe 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/implicationsThe study is limited to sub-Saharan African economies.Practical implicationsIt 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 implicationsThe 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/valueThis 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.

South African Basic Education System: Colonial Legacies in the Curriculum Design and a Way Forward

The South African Basic Education System does little to provide skills, needed to survive outside the schooling system, for those who do not wish to pursue post-secondary school education. The education system produces secondary school graduates who are poised, as content carriers and an un-employable labour force. A research question grappled with in this paper is whether this secondary school curriculum design inherited from the colonial formal education system is beneficial for South African learners? The paper argues that the continuation of the provision of this curriculum is tantamount to contributing very little to the national educational strategic goals of creating a skilled workforce needed to run the South African economy. Additionally, this also contributes to the exacerbation of the unemployment in South Africa. From a decolonial point of view, the paper provides a comprehensive overview of the basic education curriculum from the colonial period until the contemporary period and shows how it has contributed to huge numbers of job-seekers visa-versa employees and subservient of the curriculum design and schooling system. Methodologically, this paper is informed by a qualitative research approach in the form of document review. The research revealed four major important elements in decolonization of the school curriculum namely; history lesson, social justice and self-determination, formulation and execution of the protection of indigenous knowledge systems and promoting the significance of indigenous languages and use.

Artificial intelligence and skilled employment in South Africa: Exploring key variables

The discourse surrounding artificial intelligence (AI) and its repercussions on skilled employment merits careful consideration. While AI technologies have the potential to result in job displacement within specific sectors, they concurrently usher in new employment opportunities, especially for individuals possessing advanced skills. The primary objective of this paper is to thoroughly evaluate the impact of AI on skilled employment within the South African economy. To achieve this objective, the study employs the Autoregressive Distributed Lag (ARDL) model and Granger causality analysis, spanning from 2012Q1 to 2021Q4. The results derived from the ARDL estimation reveal a substantial and positive contribution of artificial intelligence to skilled employment in South Africa, a trend observed in both the long and short run. However, two structural breaks were identified in the data, hence a re-estimation of the ARDL model. The re-estimated ARDL model revealed a negative and significant relationship between AI and skilled employment. In light of these findings, this study advocates implementing regulations and labor market policies that promote the responsible deployment of AI technology while safeguarding workers’ rights and job security. This could include establishing guidelines for AI deployment in the workplace, ensuring transparency and accountability in AI systems, and implementing social safety nets to support workers during job transitions.

Re-validating the Phillips Curve hypothesis in Africa and the role of oil prices: A mixed-frequency approach

This paper investigates the relationship between unemployment and inflation in 29 African economies by re-examining the Phillips Curve hypothesis and evaluating the role of global oil prices in predicting inflation. Existing studies often use uniform-frequency variables, which can lead to biased results by omitting information from high-frequency series. We employ a mixed data sampling regression model to analyze inflation in selected African countries by regressing monthly inflation rates on annual unemployment rates and daily oil price returns. Our findings show that the Phillips Curve hypothesis holds in a few countries across Central Africa (Cameroon, the Central African Republic, Chad, and Republic of the Congo), East Africa (Rwanda), North Africa (Algeria), Southern Africa (Botswana and Malawi), and West Africa (Burkina Faso and Mauritania). In the other countries, the hypothesis does not hold, potentially indicating a predominance of cost-push inflation. Our analysis demonstrates that global oil prices impact inflation differently across these countries. Additionally, daily oil price data significantly enhance inflation forecasting compared to monthly data. Incorporating additional economic variables, such as exchange rates and interest rates, further improves forecast accuracy. We recommend targeted monetary policies to mitigate the impacts of oil price fluctuations and unemployment on inflation.

Tourism capacity and economic growth in selected African economies

Tourism capacity and economic growth in selected African economies

Genome Size Variation in Sesamum indicum L. Germplasm from Niger.

Sesamum indicum L. (Pedaliaceae) is one of the most economically important oil crops in the world, thanks to the high oil content of its seeds and its nutritional value. It is cultivated all over the world, mainly in Asia and Africa. Well adapted to arid environments, sesame offers a good opportunity as an alternative subsistence crop for farmers in Africa, particularly Niger, to cope with climate change. For the first time, the variation in genome size among 75 accessions of the Nigerien germplasm was studied. The sample was collected throughout Niger, revealing various morphological, biochemical and phenological traits. For comparison, an additional accession from Thailand was evaluated as an available Asian representative. In the Niger sample, the 2C DNA value ranged from 0.77 to 1 pg (753 to 978 Mbp), with an average of 0.85 ± 0.037 pg (831 Mbp). Statistical analysis showed a significant difference in 2C DNA values among 58 pairs of Niger accessions (p-value < 0.05). This significant variation indicates the likely genetic diversity of sesame germplasm, offering valuable insights into its possible potential for climate-resilient agriculture. Our results therefore raise a fundamental question: is intraspecific variability in the genome size of Nigerien sesame correlated with specific morphological and physiological traits?

Agribusiness Supply Chain Collaboration: Role of Innovation Capacity and Business Process Agility as Antecedents of Supply Chain Performance

This article examines the role of innovation capacity and business process agility (BPA) in the relationship between supply chain collaboration (SCC) and supply chain performance (SCP) of smallholder agro-based enterprises (SAEs). Based on the relational view and dynamic capability theories and the survey research design, the author used questionnaires to gather data from 226 SAEs who were sampled from agribusiness associations in four regions of Ghana via the quota sampling technique. Smart PLS-SEM 4.0 was used as the statistical method to analyze the data. The results showed that SCC has a significant and positive relationship with SCP, innovation capacity, and BPA. Innovation capacity significantly mediates the relationship between SCC and SCP. Furthermore, BPA fully mediates the relationship between SCC and innovation capacity, with innovation capacity also influencing SCP. This study integrates relational and capability-based views to propose a comprehensive theoretical model showing the inter-relational effect of SCC, BPA, and innovation capacity on SCP. The empirical findings widen the context of SCC literature to include SAEs from emerging economies in sub-Saharan Africa. The empirical findings enrich the understanding of how SAEs can manage their SCCs to develop and use specific capabilities that positively impact SCP. The uniqueness of this article rests in the proposed model and new empirical knowledge, which extends the scope of the relational and capability-based views and SCC literature to include innovation capacity, BPA, and SCP of SAEs in emerging markets.

Commodity markets and the global macroeconomy: evidence from machine learning and GVAR

Based on a strongly data-intensive machine learning approach, this study first identifies the most essential globally traded commodities in view of their role for the global macroeconomic performance. At the second stage we estimate a global vector autoregressive model to assess in more detail these global reactions. Our results from the first stage indicate that of the 55 analyzed commodity markets, only four are revealed as the most important. At the second step, our GVAR analysis indicates that the commodity market effects on macroeconomic activity are neither unanimous across the commodities nor across macrovariables. As an overall result, the commodity market exposure is clearly stronger among the advanced countries such as the euro area, other developed economies, and China, compared to the emerging economies of Africa, Asia, and Latin America, at both the country and regional levels. This puts a lot of pressure on economic policies aimed at reducing, e.g., the depriving effects of commodity market price development on aggregate economic performance of these countries.

Why developing countries need a new central bank paradigm: Evidence from the Middle East and North Africa region

This study utilizes a panel of Middle Eastern and North African (MENA) economies to argue that developing countries need a new central bank paradigm. The study measures central bank independence in the MENA region. We leverage this measure of central bank independence to analyze its impact on inflation rates, economic growth rates, and unemployment rates. Our robust empirical results reveal that central bank independence has no effect on inflation rates, plays no role in economic growth, and does not contribute to job creation. The findings suggest that fixed exchange rates—rather than central bank independence—have been responsible for price stability in the MENA region over the past three decades. The prevailing central bank paradigm assumes that achieving and maintaining price stability would encourage private investment, which would subsequently promote sustained economic growth and job creation in the long term. As developing countries have failed to sustain economic growth and create decent jobs over the past thirty years, the study argues that price stability cannot be maintained, and central bank independence in these countries is likely to diminish. Consequently, the study calls for a new central bank paradigm that empowers central banks to play a more active role both in financing short-term government needs and in creating decent jobs in developing countries.

Public Health Expenditure and Sustainable Health Outcomes in 45 Sub-Saharan African Countries: Does Government Effectiveness Matter?

This paper examines the interaction between health expenditure and health outcomes with due consideration for government effectiveness across developing African economies. The rich data for this study draw from forty-five Sub-Saharan African (SSA) countries covering the period 1960 to 2022. The analysis follows a country-specific comparative manner using the Autoregressive Distributed Lag (ARDL) model as the major estimation technique. The results indicate that poor health outcomes are not due to inadequate budgetary allocations alone. Specifically, this study found a cointegrating relationship and strong adjustment of health outcomes deriving from the shocks and dynamics of not just health expenditures, but also government effectiveness. It is therefore recommended that strong institutions and safety nets be created to guard against corruption and leakages that derail the beneficial impact of public health spending. Also, government expenditures should be focused more on cottage and primary health dimensions to better mitigate adverse health conditions in SSA countries.

Exchange rate movement and stock returns in most capitalised economies in Sub-Saharan Africa

In line with the extant literature that financial markets do mutually cooperate, this study investigates the nexus between exchange rate movement and stock returns in the six most capitalised economies in Sub-Saharan Africa (SSA). The study ascertains the relevance of the traditional or portfolio adjustment theory to sub-Saharan Africa’s financial markets. The study accounted for heterogeneity and dependence among the cross-sections and applied the Driscoll and Kraay and the Feasible Generalised Least Square econometric procedures on Bloomberg (2023) monthly datasets spanning between 2000:1 and 2022:12. The study findings reveal the nexus between the variables flows from stock returns to the exchange rate in SSA and some consistency with the argument of the portfolio adjustment theory. Estimates of Dumitrescu-Hurlin's (2012) Granger non-causal test also reveal a unidirectional causal relationship between both variables in the most capitalised economies in SSA. Macroeconomic policies that vitiate the limitations of both variables in SSA are recommended.

Developing a PmSLP3-based vaccine formulation that provides robust long-lasting protection against hemorrhagic septicemia-causing serogroup B and E strains of Pasteurella multocida in cattle.

Pasteurella multocida is a bacterial pathogen that causes a variety of infections across diverse animal species, with one of the most devastating associated diseases being hemorrhagic septicemia. Outbreaks of hemorrhagic septicemia in cattle and buffaloes are marked by rapid progression and high mortality. These infections have particularly harmful socio-economic impacts on small holder farmers in Africa and Asia who are heavily reliant on a small number of animals kept as a means of subsistence for milk and draft power purposes. A novel vaccine target, PmSLP-3, has been identified on the surface of hemorrhagic septicemia-associated strains of P. multocida and was previously shown to elicit robust protection in cattle against lethal challenge with a serogroup B strain. Here, we further investigate the protective efficacy of this surface lipoprotein, including evaluating the immunogenicity and protection upon formulation with a variety of adjuvants in both mice and cattle. PmSLP-3 formulated with Montanide ISA 61 elicited the highest level of serum and mucosal IgG, elicited long-lasting serum antibodies, and was fully protective against serogroup B challenge. Studies were then performed to identify the minimum number of doses required and the needed protein quantity to maintain protection. Duration studies were performed in cattle, demonstrating sustained serum IgG titres for 3 years after two doses of vaccine and full protection against lethal serogroup B challenge at 7 months after a single vaccine dose. Finally, a serogroup E challenge study was performed, demonstrating that PmSLP-3 vaccine can provide protection against challenge by the two serogroups responsible for hemorrhagic septicemia. Together, these data indicate that PmSLP-3 formulated with Montanide ISA 61 is an immunogenic and protective vaccine against hemorrhagic septicemia-causing P. multocida strains in cattle.

The Applicability of Design Thinking in the Tourism Sector, Kwazulu-Natal, South Africa

One of the most significant corporate trends nowadays is design thinking, which gives firms the ability to develop their strategic thinking capabilities in order to tackle difficult problems. The goals of design thinking are to transform enterprises, encourage imaginative abilities, pinpoint needs and opportunities, and provide fresh ideas and scenarios for the company. South Africa's economy can grow as much as is desired by including all of these aspects. Design thinking is a capability that may deliberately assist the South African tourism industry in attaining its aspirational goals of increasing visitor arrivals, accelerating job development, and unleashing entrepreneurial prospects across sub-sectors that are closely related to the tourism sector. Tourism industry stakeholders must be aware of the evolving consumer demands. Understanding whether design thinking might be applied to the tourism sector in KwaZulu-Natal, South Africa, and whether doing so may be effective and advantageous for this sector, was the study's primary objective. Purposive sampling was used in this study's qualitative research approach. Eleven members of the tourism industry participated in a design thinking workshop, a focus group, and interviews in August and September 2021. The main conclusions showed that design thinking would be an effective technique to support improvements and innovation in the tourism sector, as all participants confirmed and agreed. The study's findings have led to various factors that can help design thinking improve tourism industry business. It is recommended that though design thinking can boost business in the tourism industry, a number of contributing factors must be properly implemented.

Adaptation through Climate-Smart Agriculture: Examining the Socioeconomic Factors Influencing the Willingness to Adopt Climate-Smart Agriculture among Smallholder Maize Farmers in the Limpopo Province, South Africa

Agriculture contributes to the South African economy, but this sector is highly vulnerable to climate change risks. Smallholder maize farmers are specifically susceptible to climate change impacts. The maize crop plays a crucial role in the country’s food security as is considered a staple food and feed. The study aimed at examining the socioeconomic factors influencing smallholder maize farmers’ willingness to adopt climate-smart agriculture in the Limpopo Province, South Africa. It was conducted in three different areas due to their specific agro-ecological zones. A multipurpose research design was used to gather data, and multistage random sampling was used to choose the study areas. Subsequently, 209 purposefully selected farmers were interviewed face-to-face using structured questionnaires and focus discussion groups. Descriptive results revealed that 81%, 67%, and 63% farmers in Ga-Makanye, Gabaza, and Giyani were willing to adopt CSA. Using the double-hurdle model, the t-test was significant at 1%, Prob &gt; chi2 = 0. 0000, indicating a good model. At a 5% confidence level, education, crop diversification, and information about climate-smart agriculture (CSA) positively influenced adoption, while household size and agricultural experience negatively influenced it. It is recommended that the Department of Agriculture, Land Reform, and Rural Development provide CSA workshops and educational programs to farmers to enhance their knowledge and decision-making processes regarding adaptation strategies.

Achieving Sustainable Development Goal Four (4) in Africa: Spotlighting the role of quality education and innovation orientation

The novel coronavirus (COVID-19) has damaged the global economy and business ecosystem. Also, quality education and skills mismatch have become critical in today’s working environment post-COVID-19. Furthermore, one of the 17 Global Goals comprising the 2030 Agenda for Sustainable Development is quality education, yet Africa pays less attention to this and its impact in the workplace and organizations. This study, therefore, examined the effects of quality education on the innovation orientation of selected consumer goods companies listed in Nigeria and their role in achieving SDGs in Nigeria, the most populous and largest economy in Africa. Findings showed that quality education had a significant effect on innovation orientation. This study recommends that management and stakeholders consider the benefits of quality education in innovation and innovation orientation and, therefore, channel resources to achieve and align with Sustainable Development Goal 4.

The vulnerability to climate change in Africa: Does industrial development matter?

AbstractIn a context marked by an upsurge in the scale of climate change and its consequences in Africa, this article explores ways to increase the resilience of African economies. It aims to analyze the effect of industrialization on the continent's vulnerability to climate change (VCC). The sample used for this purpose consists of 41 African countries from 2010 to 2021. A dynamic panel model is estimated using the system generalized method of moments. Results show that industrialization reduces the VCC in African countries. It reduces their sensitivity to climate change while increasing their adaptive capacity. Furthermore, results show that industrialization is more likely to reduce the VCC in sectors such as ecosystems, habitat, health, and infrastructures whereas it increases vulnerability to climate change in the food and water sectors. The results, however, reject the environmental Kuznets curve hypothesis between industrialization and VCC. These results are robust to the change in industrialization measures. Therefore, African countries would benefit from pursuing their industrial development through greater use of renewable energy. This can help them to sustainably reduce their VCC. In addition, they need to implement specific measures to adapt to climate change in the food and water sectors.