Fragile Economy Research Articles

Judicial Activism in Pakistan and its Impacts on Tripartite Governance: Lessons from the US Constitutional Construct

The judiciary played a significant role in the evolution of democracy in Pakistan. Throughout history, the military remained at the core of politics and as an avoidable stakeholder influenced the judiciary in validating its extraconstitutional actions. However, after 2009, the judiciary emerged as exceptionally independent invalidating extraconstitutional actions and stretching its authority to take up matters else within the jurisdictional province of the other state organs, resulting in judicial overstretch. Excessive judicial activism had evident adverse impacts on the equilibrium of the state organs, imposed financial liabilities, and compromised its dignity. By employing qualitative research methodology, this article considers the judiciary as a double-edged weapon and critically examines the cases where the judiciary deviated from the international treaty obligations, leaving the fragile economy of Pakistan to a blow of penalties. Lastly, the research contributes to what Pakistan can learn from the US Constitutional construct.

Empowering energy access: Exploring financial inclusion's impact on energy poverty in the fragile five economies

Energy poverty is a major issue that deepens economic challenges, especially in the five fragile states of Turkey, Brazil, South Africa, India, and Indonesia. The objective of this study is to examine the impact of financial inclusion on energy poverty, as removing financial barriers to energy access and utilisation is critical for sustainable development. The study hypothesizes that financial inclusion plays a decisive role in alleviating energy poverty. The study analyses the second generation panel methods such as AMG, Driscool-Kraay, and FMOLS using annual data from 2000 to 2021 and examines the causal relationships between variables using Dumitrescu-Hurlin panel causality test. The findings reveal that financial inclusion, low carbon technology trade, energy efficiency, economic growth, and human capital play a central role in alleviating energy poverty in these economies. On the other hand, a unidirectional causal relationship was found between financial inclusion and low carbon technology trade, human capital, energy efficiency, and energy poverty. In contrast, a bidirectional causal relationship was observed between economic growth and energy poverty. These findings provide important insights for policymakers and stakeholders; understanding the complex dynamics between financial inclusion and energy poverty can help design targeted strategies to increase energy access and promote inclusive economic development in fragile economies.

Sustainability of the Current Account in Developing Countries: A Fourier Wavelet-Based Unit Root Test

The sustainability of the current account balance for five fragile economies—Brazil, Argentina, South Africa, India, and Türkiye (namely, BASIT)—is investigated. These countries’ economies operate under a time current account deficit almost all the time, a condition that causes fragility to external shocks; the following fallout from these shocks may risk not only the domestic economy but also the international economy, such as by clogging trade and income distribution. In this study, the sustainability of the current account in BASIT countries is examined via wavelet-based Kapetanios, Shin and Snell (WKSS) and Fourier wavelet-based KSS (FWKSS) unit root tests, in conjunction with linear unit root tests. Even though traditional unit root tests generally support the sustainability of a current account deficit for all countries, a non-linear unit roots test confirms the traditional tests for only India and South Africa. Results from the wavelet transform of non-linear unit root tests indicate the unsustainability of the current account balance, except in the case Türkiye. Moreover, the FWKSS test confirms WKSS.

Direct Effect of Terrorism on Economic Growth

The objective of this article is to study the effect of terrorism on economic growth and the transmission mechanisms of this effect. To do this, a simultaneous equation model was applied to panel data for a sample of 31 countries (18 developing and 13 developed). The results of this study show the following: Terrorism has a significant negative impact on economic growth in the case of the entire sample; Unemployment also has a significant negative effect on economic growth in the case of the entire sample; Investment and FDI have positive and significant effects on economic growth in the case of the entire sample; For developed countries, we see that terrorism has no significant effect on economic growth; FDI had a positive and significant impact on economic growth in the case of developed countries; Unlike the case of developing countries, we note that terrorism has a positive and significant impact on economic growth; Unemployment, investment and FDI have a positive and significant impact on economic growth in the case of developing countries. It can be said that terrorism threatens fragile economies more and poses no problem in advanced economies.

Sovereign Credit Risk in Saudi Arabia, Morocco and Egypt

The purpose of this paper is to assess and predict sovereign credit risk for Egypt, Morroco and Saudi Arabia using credit default swap (CDS) spreads obtained from the DataStream database for the period from 2009 to 2022. Our approach consists of generating the implied default probability and the corresponding credit rating in order to estimate the term structure of the implied default probability using the Nelson–Siegel model. In order to validate the prediction from the probability term structure, we calculate the transition matrices based on the implied rating using the homogeneous Markov model. The main results show that, overall, the probabilities of defaulting in the long term are higher than those in the short term, which implies that the future outlook is more pessimistic given the events that occurred during the study period. Egypt seems to be the country with the most fragile economy, especially after 2009, likely because of the political events that marked the country at that time. The economies of Morocco and Saudi Arabia are more resilient in terms of both default probability and credit rating. These findings can help policymakers develop targeted strategies to mitigate economic risks and enhance stability, and they provide investors with valuable insights for managing long-term investment risks in these countries.

Analyzing the impact of an MDG-Fund program on childhood malnutrition in Timor-Leste

BackgroundTimor-Leste’s food insecurity, propelled by political conflicts, a fragile economy and biophysical limitations that characterize mountainous Small Island Developing States (SIDS), is expressed in a high incidence (50%) of stunted children. Hence, the Millennium Development Goals Achievement Fund’s Joint Program’s (MDG-F JP) in 2009 was a timely intervention to reduce prevalence of underweight among under-fives. Since the impact of the program remains largely unclear, the current study investigates the contributions of the MDG-F JP on improving children’s nutritional status in Timor-Leste, in order to inform policymakers on how to make future programs more effective.MethodsUsing bivariate analyses and multiple linear regression models we analyzed Demographic and Health Survey (DHS) data from under-fives in 2009–2010 and 2016, combined with spatially explicit data from geographic information systems (GIS). The analyses generated trends and factors associated with undernutrition, which were used in a quasi-experimental setting to compare districts that received the MDG-F JP with similar districts that did not receive MDG-F JP interventions.ResultsA comprehensive set of factors dependent on seasons, locations, and individuals determine undernutrition in Timor-Leste. A positive impact of the MDG-F JP was found for the average severity of wasting, but not for stunting and underweight.ConclusionsThe findings reinforce the pressing need for integrated and cross-sectoral programs, aimed especially at agricultural workers, mothers, and children. The agricultural challenge is to sustainably select, produce and conserve higher-yield and nutrient-rich crops, and educational enhancement should be aligned with local practices and research.

Availability of the current and future water resources in Equatorial Central Africa: case of the Nyong forest catchment in Cameroon.

To anticipate disasters (drought, floods, etc.) caused by environmental forcing and reduce their impacts on its fragile economy, sub-Saharan Africa needs a good knowledge of the availability of current water resources and reliable hydroclimatic forecasts. This study has an objective to quantify the availability of water resources in the Nyong basin and predict its future evolution (2024-2050). For this, the SWAT (Soil and Water Assessment Tool) model was used. The performance of this model is satisfactory in calibration (2001-2005) and validation (2006-2010), with R2, NSE, and KGE greater than 0.64. Biases of - 11.8% and - 13.9% in calibration and validation also attest to this good performance. In the investigated basin, infiltration (GW_RCH), evapotranspiration (ETP), surface runoff (SURQ), and water yield (WYLD) are greater in the East, probably due to more abundant rainfall in this part. The flows and sediment load (SED) are greater in the middle zone and in the Southwest of the basin, certainly because of the flat topography of this part, which corresponds to the valley floor. Two climate models (CCCma and REMO) predict a decline in water resources in this basin, and two others (HIRHAM5 and RCA4) are the opposite. However, based on a statistical study carried out over the historical period (2001-2005), the CCCma model seems the most reliable. It forecasts a drop in precipitation and runoff, which do not exceed - 19% and - 18%, respectively, whatever the emission scenario (RCP4.5 or RCP8.5). Climate variability (CV) is the only forcing whose impact is visible in the dynamics of current and future flows, due to the modest current (increase of + 102 km2 in builds and roads) and future (increase of + 114 km2 in builds and roads) changes observed in the evolution of land use and land cover (LULC). The results of this study could contribute to improving water resource management in the basin studied and the region.

A framework for developing and implementing FIT policies for renewable energy based on local economic conditions

Energy policymakers of developing countries are striving to provide adorable, reliable, and cleaner energy for all the sectors of their economies. Feed-In Tariff (FIT) policies have played an important role in attracting independent power producers to invest in energy generation from renewable sources in developed and some developing countries. However, the development and application of the FIT policy framework are not autonomous of national and local fiscal and socio-economic policies. Financial modeling of FIT which considers local economic conditions and the state of the energy sector at the national level can contribute to the development of FIT policies that are relevant, realistic, and sustainable to investment in energy generation from renewable energy sources at the local level. This paper outlines the financial modeling of the FIT rates using a solar farm in Malawi as a case study. The results show that a shift from a fixed price model to a fixed price model with full or partial inflation adjustment considering the volatile inflation rate and macroeconomic risks in a fragile economy can effectively attract and increases private investments in the energy sector. Consequently, the financial modeling of FIT can enhance the generation of strategic information that can be used for the development of FIT policies that are relevant, realistic, and sustainable in the context of local economic conditions.

Kırılgan Piyasa Ekonomileri Arasında Döviz Kurları Yakınsıyor mu? LM ve RALS-LM Birim Kök Testlerinden Yeni Kanıtlar

Global financial integration causes the economic consequences of economic crises, wars, or pandemics to be felt more in developing countries and triggers high exchange rate volatilities in these economies. In such an integrated financial environment, it is an interesting research domain how and why the exchange rate volatilities of countries are not affected similarly but tend to diverge from each other. This study investigates whether the exchange rate volatilities of fragile market economies converge in the stochastic convergence framework. To answer this question, we analyzed the stochastic behavior of the series using the traditional and structural break unit root tests besides RALS unit root tests, which consider the information of non-normal errors. The discussions regarding the size and power properties of test procedures in the unit root testing literature have formed a crucial part of the implications of the test results. In light of these discussions, we conclude that the stochastic convergence assumption is valid for Brazil, South Africa, India, and Hungary, whereas it is not valid for Argentina, Mexico, and Türkiye. The policy implications of our findings are that fragile market economies have different fragility levels among themselves and countries with high fragility levels show higher volatility than others.

Examining the linkages among financial inclusion, economic growth, poverty, and inequality reduction in Africa

The study examined the nexus between financial inclusion and economic growth, poverty, and inequality in Fragile and Post-Conflict African economies based on data sourced from 2004 to 2021. The study employed the system GMM and dynamic threshold model within the context of the Tunnel and Joneses effects to analyze the data generating set. The study noted that financial inclusivity enhances growth, and reduces poverty and inequality in the studied economies. The results of robustness tests reveal that our model is appropriate, this suggests the validity of the Tunnel effect in the studied economies. The threshold dynamic result suggests that the optimal influence of financial inclusion on economic growth, poverty, and inequality is at 42% for the studied economies. The study offered some policy implications.

Time Management and its Impact on Business Growth: A Study of Public Holidays and Work Stoppages in Nigeria

This article provides a nexus between time management, public holidays and other work stoppages in Nigeria. It looks at the negative consequences of having too many public holidays and work stoppages in a fragile and dependent economy like Nigeria. Too much of everything is bad it is said. Any action that leads to the stoppage of work activities is detrimental to the growth of businesses. Nigeria observes too many works stoppages in a calendar year, and research shows that intermittent and frequent works stoppages can cause damage to the efforts designed to make a country’s financial and capital markets catch up with global trends. Further researches also show that Nigeria’s financial system handles a large amount of transaction that principally involves all banks in the country. In turn, these institutions facilitate the transactions of all economic agents. This study treats all holidays as works stoppage; all off duty activities such as strikes that consumes economic or man-hour is referred to as work stoppage (strike inclusive).

Criticism of Multilateral Development Banks Operating Reflections During Covid-19 Pandemic - From the Perspective of the Sovereign Debt

The problem of sovereign debt crises has a long history at the international level, especially in the face of global crises such as the global financial crisis of '08 and the recent COVID-19 pandemic. In the face of the negative social impacts of these emergencies, the state apparatus of each country needs help with relying on domestic channels such as tax revenues and investment returns to maintain efficient operations. It would, therefore, finance other countries in non-domestic currencies, and such a solution would exacerbate countries' sovereign debt crises. Countries have done well in restructuring their sovereign debt in response to sovereign debt crises, especially in Europe and Africa. The International Development Association provided some debt relief to those countries with fragile economies, but the crisis is still present today. In order to expand sustainable financing and maintain economic stability, new multilateral development banks have been established in some regions. These MDBs have been restructuring since the Great Depression, and their lending policies have indeed eased countries' sovereign debt crises to some extent. However, their financing rules have also influenced other countries' policies, making them widely criticised internationally. In the context of COVID-19, both the strengths and weaknesses of MDBs are exposed, so they still have a long way to go before they can become international institutions that can pay attention to disadvantaged countries and help them develop.

Factors affecting the application of management accounting of revenue, costs, and business results

The effective management accounting of revenue, costs, and business results holds significant importance in enterprise management accounting, particularly for businesses situated in countries with fragile economies such as Vietnam. However, the current situation of applying accounting of revenue, costs, and business results at enterprises, in general, and electricity enterprises in Northern Vietnam, in particular, still has many limitations. Therefore, this article aims to promote the level of effective management accounting for revenue, costs, and business results. A quantitative study was undertaken, involving the distribution of questionnaires to 57 companies within the electricity sector in Northern Vietnam. The collected data was then analyzed using Excel and Statistical Package for the Social Sciences (SPSS) 22 software. The findings of the study reveal that there are six elements influencing the management accounting of revenue, costs, and business results in electricity enterprises, including 1) the amount of financial accounting information provided; 2) enterprise size; 3) corporate culture; 4) qualifications/quality of accounting staffs; 5) level of awareness of business managers, and 6) availability of information technology. Therefore, the article proposes a recommended solution to ameliorate the management accounting of revenue, costs, and business results in electricity enterprises in Vietnam.

A Hybrid Approach for the Supply Chain Risk Assessment of the Construction Industry During the COVID-19 Pandemic

COVID-19 is an epidemic threat to human health caused by a novel coronavirus. Different countries are still struggling with whether to extend lockdown policies considering economic recession outcomes or lift the lockdown and recover the fragile economy. This research narrows the knowledge gap by applying a decision-making approach in a fuzzy environment to consider the uncertainties in the supply chain risk assessment of the construction industry during the COVID-19 pandemic. Besides, risk factors (RFs) are identified and interrelationships between RFs are depicted. RFs are categorized using expert panel surveys and literature reviews. The interdependencies between different RFs are evaluated using a combination of interval-valued intuitionistic fuzzy numbers, decision making trial and evaluation laboratory, and the Choquet integral to allow a strong interrelationship between the sum of rows and the sum of columns of RFs in structural correlation analysis. Next, priorities of RFs are obtained by considering interdependencies between different RFs using a combination of the technique for order preference by similarity to the ideal solution (TOPSIS) method with the intuitionistic fuzzy set. An intuitionistic fuzzy weighted average operator is utilized to aggregate individual opinions of decision makers for rating the importance of RFs. Results reported that the scarcity of material and financial resources due to movement restrictions with overall weights of 0.0614 and 0.413 are the most prominent RFs in the supply chain due to the COVID-19 pandemic. The results of this research can assist decision-makers in developing strategic policies to prevail over the risk challenges and subsequently aid experts in redesigning supply chains.

‘Peacefully’ at ‘War’: An Analysis of the Southern African Development Community’s Institutional Framework’s Failure to Respond Adequately to the Ongoing Conflict in Swaziland

The Kingdom of Swaziland is well known for being a peaceful nation. This historical claim is supported by the fact that the little kingdom is situated between two nations that at some point engaged in armed conflict, the Republic of South Africa and the Republic of Mozambique. When tensions in the two states mentioned above were at their worst, Swaziland served as a haven for those fleeing the violence. However, the little kingdom has recently been embroiled in internal conflict as demands for democratic reforms grow, and the King rebuffs attempts to overthrow his absolute authority. The Southern African Development Community (SADC) framework for resolving regional conflicts is analysed in this article, together with the ongoing conflict in the Kingdom of Swaziland. The many fact-finding missions and SADC organs’ visits to Swaziland are discussed in this article, along with how their inaction is sustaining a protracted, intense internal conflict. The study also looks at the role that state-sponsored terrorism has played in the response to the conflict by His Majesty King Mswati III's administration. The tiny kingdom is at a turning point because SADC has failed to impose its authority and because the King, despite his undertaking, has actively avoided political engagement. Furthermore, the study argues that the protracted violence in Swaziland will have detrimental effects on South Africa, which already has a fragile economy and is trying to manage the refugee surge. It concludes by positing that it would be ideal to prevent a dangerous scenario for the region if SADC intervened by asserting its authority and demanding a proper dialogue in Swaziland among all stakeholders with clear terms of reference.

What are the impacts of climate change and the Ukrainian war on the sustainable development goals? A case study for Burkina Faso

AbstractRepeated shocks to fragile economies call into question the feasibility of the achievement of the sustainable development goals. This study uses a gender‐dynamic computable general equilibrium model linked to a micro model to assess the impacts of the war in Ukraine and climate shocks on SDG1, SDG2, SDG5 and SDG8 for Burkina Faso's economy. The results reveal negative impacts on economic growth with an increase in food insecurity and household poverty. Urban households are the most affected by food insecurity, while unskilled men are most likely to lose their jobs in the short run. In the long run, however, women experience more job losses than men.

Renewable Rush in Syria Faces Economic Crisis

<p><span lang="EN-US" style="font-size: 12pt; font-family: verdana, geneva, sans-serif;">Since 2011, the conflict in Syria left the country with a devastating energy sector and fragile economy. The residents struggle daily to live with only two hours a day of electricity. The crisis encouraged some Syrians to assemble photovoltaic (PV) panels to generate energy. Unfortunately, the geopolitical risks, the inflation, and displacement are making the situation worse. The geopolitical risks are complex and multifaceted due to the ongoing war and the involvement of various regional and international actors. In this letter, we focus on the situation in war-torn Syria, its economy, and the opportunities for renewable energy development in the country. We also give some recommendations for academics and policy makers.</span></p>

Harnessing the power of education for social change

It cannot be overthrown that South African education - basic and higher - plays a central role in generating constructive social impact. Global education is no exception to this endeavor given that each country’s education system is interlaced with the global standards and norms. In the same vein, it cannot be downplayed, that South Africa’s education has been characterized by colonial and apartheid structures that sought to advance social injustices, such as the exclusion of underprivileged communities, Black South Africans and indigenous languages, among many other determinants. In view of this fact, it remains consequential to recurrently re-visit this system in a bid to underline some of the intricacies that exist within it, while attempting to solve any identified challenges. Bearing this in mind, this article aims to harness the power of South African education in respect of social change; and illustrate how and why it remains a vehicle that can be regarded and utilized to create social change, cohesion and consciousness. Argumentative research technique is employed herein, while critical pedagogy as a theoretical framework is applied to advance the discussions of the article. The principal findings and discussions, among others, underscore that learners and students should be provisioned with an education system that contests and addresses contemporary social injustices, such as gender-based oppression, unemployment, poor healthcare system and fragile economy, among other challenges. In this way, this significant component of social and human existence becomes more inclusive and pertinent in contemporary terms. The closing remarks underscore the necessity to continue debating issues that pertain to education in an attempt to lucidly outline its constructive outcomes

Investigation of electricity distribution, shortages in the Gaza strip, and the role of renewable energy technologies for addressing the electricity crisis

This study examines the electricity crisis in the Gaza Strip and its impact on public well-being. Adopting a sequential exploratory mixed-methods approach, data were collected from 350 households and key institutions. The research assesses the current state of renewable power technologies applicable to the region and develops a performance matrix to identify the most suitable technology for providing clean and affordable electricity. The findings highlight solar energy as the most viable solution for addressing the electricity shortage in the Gaza Strip. Moreover, the study underscores the adverse effects of electricity shortages on vital services, including health, water, and sanitation, as well as the fragile economy. The research recommends strategic investments in solar energy as a reliable and cost-effective solution that is readily accessible to meet the energy needs of the Gaza Strip and Palestine at large. This study provides a valuable resource for national and international NGOs, offering insights into the strengths, weaknesses, opportunities, and threats within the Gaza Strip's electricity sector.

Causality between Foreign Direct Investment Outflows and Economic Fragility: A Study on Eight Fragile Economies

Bu çalışmanın amacı, kırılgan sekiz ekonominin (Arjantin, Brezilya, Çin, Kolombiya, Hindistan, Güney Afrika, Tayland, Türkiye) doğrudan yabancı yatırım çıkışları ile ekonomik kırılganlık göstergeleri arasındaki nedensellik ilişkisini araştırmaktır. 1995-2021 dönemini kapsayan çalışmanın veri seti, doğrudan yabancı yatırım çıkışları ile ekonomik kırılganlık göstergesi olarak belirlenen; tüketici fiyat endeksi, merkezi hükümet borçları/gayrisafi yurt içi hâsıla, toplam rezerv/dış borç, M2/gayrisafi yurt içi hâsıla, cari işlemler dengesi/ gayrisafi yurt içi hâsıla, bankalar tarafından sağlanan yurtiçi özel sektör kredileri/ gayrisafi yurt içi hâsıla ve toplam borç/ihracat değişkenlerinden oluşmaktadır. Kónya (2006) tarafından geliştirilen bootstrap panel nedensellik analizi sonuçlarına göre; ekonomik kırılganlığı temsil eden değişkenler ile doğrudan yabancı yatırım çıkışları arasında nedensellik ilişkisi en çok Tayland’da, en az Çin’de görülmektedir. Araştırma sonuçları, ekonomik kırılganlık göstergeleri ile doğrudan yabancı yatırım çıkışları arasındaki nedensel ilişkinin yönü konusunda güçlü bir fikir birliği olmadığını göstermektedir. Çalışmanın bulgularına dayanarak her ülkenin kendi iç dinamiklerine uygun politika geliştirmesi önerilmektedir.