PSD Blog - The World Bank Group

Bank privatization and productivity

Two Brazilian researchers have examined the recent history of Brazil’s banking industry, evaluating the impact of privatizations and an increasing trend of mergers and foreign entry. Their conclusion:

.. state-owned banks are less productive than private owned ones.… privatization has had a positive impact on productivity. Moreover, the positive effects of privatization seem to take some time to materialize. Privatization proved also to be a superior strategy than restructuring and keeping the bank under state control.

A new way to house the poor

The Economist reports that the UK has quietly moved towards a new way of housing the poorest:

In the past few years, an increasing proportion [of homeless] have been biding their time in private housing, most of it arranged by local authorities but some leased directly from landlords. Tenants pay rent and recoup the outlay through housing benefit. That is, in some ways, an excellent solution. Private housing is both more flexible than social housing and more dispersed: pockets of deprivation like those found on council estates are less likely to emerge.

Of course, as with many public-private initiatives, the proper alignment of incentives still needs work – some claiming that the current structure actually creates a disincentive for entering the formal workforce.

Private participation in healthcare events

Two events next week for those of you in DC:

On October 4 the Center for Global Development will be having an event on Private Sector Responses to HIV/AIDS: The Case of Debswana, Botswana’s Diamond Company.

On October 5 the USAID funded 'Banking on Health' project will be having a discussion on Strengthening Contracting Out in the Private Sector in Nicaragua.

$100 laptop from Negroponte

Nicholas Negroponte, chairman and founder of the Massachusetts Institute of Technology Media Labs, has been outlining designs for a sub-$100 PC. The laptop will be tough and foldable in different ways, with a hand crank for when there is no power supply.

That's from the BBC. Some commentators worry that the device will be copied by fakers or sold to buy food. Not sure that's such a problem, although it might have been easier to helicopter in some cash than these cool new laptops.

How to understand

Write something to explain what you see in simple language, says Robert Frank:

Over the years, my students have posed and answered literally thousands of fascinating questions. My favorite was submitted by Jennifer Dulski, who asked, "Why do brides often spend thousands of dollars on wedding dresses they will never wear again, while grooms often rent cheap tuxedos, even though they will attend many formal social events in the future?"

The answer is here. I've been writing about economics for a few years now; I couldn't agree more, although I can't claim as much insight as Professor Frank's students. HT Marginal Revolution.

How to spend billions of dollars?

That is the welcome burden facing Roman Abramovich, Britain’s richest man and owner of the Chelsea football club, who yesterday essentially doubled his fortune – making $13.1 billion when he sold his share in Sibneft. The Financial Times asks its readers for suggestions on how he should spend this new bounty. As I write this, only one response so far, but it was nice to see that it was in favor of alleviating poverty - not buying up all of the Serie A and NBA as well. I think we know what Jeffrey Sachs would say. What would you do?

Private pension systems

When you consider that trillions of dollars are now managed by the private pensions industry, it’s extremely important to know how well they have performed in providing high rates of return, secure and reliable benefits and constraining costs.  These continue to be among the most hotly debated pension policy questions in virtually all countries worldwide.

…the words of  Robert Holzmann, World Bank Director of Social Protection. On Monday the World Bank, OECD and ING announced a new joint research partnership that will study how privatized pension systems have performed in developing and transition economies during the past twenty years. They are looking for more potential partners.

2005-06 Global Competitiveness Report

The World Economic Forum has released their annual ranking of worldwide competitive conditions. Finland, the US and Sweden lead the way, with five Nordic countries placing in the top 10.  The WEF praised the solid public institutions and macro economic management of the Scandinavians:

[The results challenge] the conventional wisdom that high taxes and large safety nets undermine competitiveness, suggesting that what is important is how well government revenues are spent, rather than the overall tax burden per se.

Of course, Doing Business would agree,

Just 8 percent of economic activity in Nordic countries occurs in unregistered (informal sector) businesses. The reason is that regulations are simple to comply with and businesses receive excellent public services for what they pay in taxes. For example, Denmark has the world’s best infrastructure... In the Nordic countries, as well as the other top 30, reformers do not have to choose between making it easy to do business and providing social protection. They can do both.

More on the WEF report: download the full report, growth competitiveness index or business competitiveness index.

Update: More coverage at the WEF Blog, and Lawrence White questions what a "competitiveness" ranking really is?

Most expensive US states for doing business

The World Bank’s Doing Business report ranks the US 3rd out of 155 economies globally in terms of the ease-of-doing-business. However, if you want state-specific numbers on the cost-of-doing business, see the latest index from the Milken Institute. For state benchmarking beyond just business costs, see their other indexes. Or are you more interested in China? (ht: Don Iannone)

Green public-private partnerships

Christian Verschueren, the Director-General of CropLife International, believes that expanding public-private partnerships is the best way to achieve a "Green Revolution" for Africa:

It is true that the UN and Bretton Woods institutions must be prepared to step up official development aid to developing countries to make this happen. But, governments must also remember that the private sector has a big role to play, and that a stronger impact can be achieved through co-operation and expansion of successful public-private partnerships.

He goes on to discuss sustainable farming techniques, pest control, the International Rice Genome Sequencing Project, biodiversity…

'Protecting women' in India

We know that well-meaning regulations often damage people they were intended to protect. Strong prohibitions on firing workers, for example, make employers reluctant to hire, and particularly to take a chance on inexperienced workers.
Saddening to hear the news from India, then:

NEW DELHI: Here’s a case of killing a $5.2-billion golden goose with a stick made in 1958. Haryana government has sent notices to Gurgaon-based call centres asking them not to allow women employees on night shifts. As women comprise an estimated 40% of the workforce.

The full story is from the Times of India, and they believe the ruling could seriously damage the call center business. Thanks to the Indian Economy blog.

What is output-based aid?

The Global Partnership on Output Based Aid have a 30-page paper explaining just that:

OBA subsidies are explicit and performance-based. They are explicit because they ensure recognition of why the subsidy is being provided, who is receiving the subsidy and who is providing it, and what is being subsidized... OBA is performance-based because it strongly links the payment of service providers to their delivery of specified "outputs". By contrast, in many other approaches, donors or governments pre-fund "inputs".

Want more? The 'Contracting for Public Services' book contains numerous case studies and is available for free download.

Gary Becker on sustainable development

A recent study (see Becker, Philipson, and Soares, "The Quantity and Quality of Life and the Evolution of World Inequality" American Economic Review, March 2005) shows how to combine improvement in life expectancy with traditional measures of the growth in GDP to measure what we call the growth in "full" income. We demonstrate that the growth in full income since 1965 has been much faster than the growth in material income in essentially all countries, but especially in less developed nations. A better measure of full income that adjusts not only for the growth in life expectancy, but also for changes in the environment, and for the great advance in the mental and physical health of those living, especially of the elderly, almost surely grew at an even faster rate.

Read the rest. His co-blogger, Richard Posner, is more worried about sustainability, because he thinks that the world's population will eventually grow too large.

Towards smarter aid

Lex Reiffel of Brookings writes in The Globalist:

The MCC appears to be drifting toward “more of the same.” Its first four country programs look too much like projects administered by the World Bank and USAID.

Read his full report from Brookings or see our own page on Aid Effectiveness.

Is branding key to generating wealth in the developing world?

In his new book, Brand New Justice, Simon Anholt argues that better understanding the nature and value of brands is essential for poor nations wanting to capitalize on Globalization - since wealth is created on “the last mile” of the commercial process. In his own words:

[The book] shows how marketing is, in fact a powerful tool for economic development, and might make a very worthwhile contribution to the fairer distribution of global wealth… So it makes sense to take a closer look at how these brands multiply money, and see whether their genius for doing so might be transferable to some of the people and places really need it.

For example, he tells us that the intangible assets of the world’s top 100 global brands is roughly equal to the combined GNI of all 63 countries [then] classified by the World Bank as “low income.”

Anholt is also behind the Nation Brand Index we have mentioned before. (Hat tip: Ethan Zuckerman)

A conversation with the World Bank president

This weekend’s edition of the Wall Street Journal carries an interview with Mr. Wolfowitz, including some great praise for the Doing Business report.

His favorite new source book is the World Bank's "Doing Business" report, an annual guide to the obstacles that countries impose on their own entrepreneurs. The 2006 version is just out, and for the first time Mr. Wolfowitz had it rank countries, from 1 to 155, on the "ease of doing business." New Zealand ranked first, and the U.S. third (after Singapore), but African nations held down 25 of the last 30 places.

Take Burkina Faso, a landlocked West African country that came in at . . . 154. "If you were in a food supply business," Mr. Wolfowitz says, "registering a business would require minimum capital equal to nearly five times annual income. Fees alone cost 1 1/2 times income per capita . . . to register your land, you have to pay fees, 16% of the value of the land. So the result is in a country of 12 million people, only 50,000 are in the formal" economy.

The article also discusses some of the main future challenges facing the World Bank Group: its role in middle-income economies, tackling corruption, the future of the IFC and managing our internal culture, operations and ambitions.

Using Doing Business to pick stocks

Forbes have been using 'Doing Business' as a stock-picking guide:

We singled out the five countries, excluding the U.S., that scored above average in all the "Doing Business" criteria. Then we mined our databases for ten reasonably valued, U.S.-listed stocks issued by companies hailing from those countries.

The results were good but not great, and this year they've changed their approach. But really, we should expect that the best-performing portfolio would come from unexpectedly good performers - this year the highest climbers include Serbia and Rwanda. And Doing Business focuses on fairly small domestic companies, while Forbes look at US-listed firms with market capitalization of over $100million.

Forbes got one thing right, though, while looking for an excuse to buy Nokia stocks:

Scandinavia tends to make regulation relatively easy to comply with and worth it in terms of quality infrastructure and public services.

The future of money transfers

Kenyan blogger Bankelele writes about the cash remittance business in Kenya:

Past: Surprisingly, Western Union and Moneygram, which have been recording growing volumes and signing up new banks (like KCB) every month, already represent the past in money remittance. The reason for this is the cost of the transfer... about 15% of amount transferred...

Present: ...I’ll give a friend my Barclays account number, and he’d go to his local Barclays branch, e.g. in Mombasa, or Kisumu, and deposit the money into my account – and I’d be able to withdraw it almost instantly in Eldoret...

Future: The future will be for money transfer via cellphone, as is already taking place in the Philippines and South Africa...

This is important. In our work on the Future of Aid we calculated that a substantial cut in the cost of remittance transfers would raise more money than the entire budget of IDA, the World Bank's concessional lending arm. Here's the graph.

    

The wisdom of Google

Saw the New Yorker's James Surowiecki yesterday, speaking about his book, The Wisdom of Crowds. He praised the effectiveness of 'prediction markets'. For example, Hewlett Packard (internally) sold assets that paid off depending on how big next quarter's printer sales turned out to be. The engineering, marketing, accounts and sales departments each had their own information and traded using it: the results were more accurate sales forecasts.

Since HP have since stopped this experiment, I asked Surowiecki whether he thought the idea would ever catch on. He admitted that organizations do seem to struggle with delegating this kind of deliberation, but was sure it was gathering momentum and would continue to do so.

Well... it turns out that Google have picked up where HP left off. Now let's get the policy wonks from the development establishment to start making some forecasts about the effectiveness of aid programs... [HT: Marginal Revolution]

Against Utopia

Bill Easterly writes in Foreign Policy (free copy available on his website):

If all of us are collectively responsible for a big world goal, then no single agency or politician is held accountable if the goal is not met.

Easterly prefers a piecemeal approach with rigorous evaluation and accountability. Has he been reading The Market for Aid?

Measuring development

That is the title of today’s lead editorial in the Washington Post, in advance of this weeks annual World Bank and IMF meetings. They argue that the new rockstar enthusiasm for helping poor countries is often misplaced.

…debt relief will save poor countries a tiny amount relative to what they can expect by way of aid. Equally, aid gets more attention than other policies that may matter more. Immigration policy is one example: The money sent home by workers from poor countries who hold jobs in the rich world comes to more than all official aid budgets combined, and the correlation between remittances and poverty reduction appears to be stronger than the correlation between aid and poverty reduction. Likewise, aid probably matters less than trade policy, too.

Their suggestion:

…the rich world needs to take a broad view of its interactions with poor countries, factoring in not only aid, trade and migration but also contributions to the poor world's military security, environmental prospects and access to investment capital and useful technology.

They also discuss the pros and cons of the Commitment to Development Index.

Business and the Millennium Development Goals

Last week the WBCSD released Business for Development: Business Solutions in Support of the Millennium Development Goals. A very manageable summary of the main issues and debates. Among their main conclusions:

We have identified three broad priorities: effective legal and regulatory frameworks, support for the small and medium-sized enterprises and investments in core infrastructure… the business community sees these three areas as the foundations of a thriving economy.

Business cannot create the right investment climate. It is for policy makers to follow through their commitments with consistent and effective action. This will require steady, long-term commitment, action and coherent strategies that intimately involve the private sector.

How to measure globalization?

The OECD provides their suggestions in their just released Handbook on Economic Globalisation Indicators. (via New Economist)

Even though the scope of the Handbook is limited to measuring the magnitude of the globalisation process, the task encompasses a potentially large number of areas. Priority is given to those that are considered the mainsprings of globalisation: international trade, foreign direct investment, the activity of multinational firms and the production and international diffusion of technology.

The full 230+ report is available online. Also of interest, the 2005 A.T. Kearney/Foreign Policy Magazine Globalization Index.

Irrepressible entrepreneurship

The BBC reports (via Shashwati's Blog) that Indians with an embarrassingly small guest list can hire extra guests. The service sounds top-notch:

The Best Guests Agency has around 70 people on its books. They can turn up either traditionally dressed or in smart Western clothes, and are briefed on family history and pretend to be friends from the past...

"My people are well-trained...we brief them specifically on each and every point about the family... not one of my guests has ever been found out."

Another example of the irrepressible inventiveness of the entrepreneur...

2006 World Development Report: Equity and Development

The 2006 WDR: Equity and Development was released yesterday. As with all of WDRs it is jam-packed with information, anecdotes and analysis. We will be sure to pass along snippets as we work our way through it.

For example, see Chapter 5: Inequality and investment, which argues for equity improvements that are also efficiency-enhancing:

Third, because investments build wealth and wealth makes it easier to invest in a world where markets do not function very well, a little help can go a long way. Starting the right business might be the biggest challenge: once started, the business might propel itself forward without further help.

Fourth, it is not clear that the beneficiaries from this kind of efficiency-promoting redistribution have to be the poorest of the poor. Because the ideal is to promote productive investments, the targets should be those most likely to make the investments.

Need more: full overview, background papers, press releases, video interviews, or buy it.

African economies can overtake Switzerland

When battling with jet-lag most people take sleeping pills, watch TV, or toss and turn in bed. Economists, however, put their sleepless nights to better use. The IFC’s Chief Economist, Michael Klein, tinkered with the Doing Business database in the middle of a sleepless night in Johannesburg and created a hypothetical African country which adopted the best African practice on each of the Doing Business indicators. (For example, he borrowed Botswana’s credit policies, the hiring and firing practices of Uganda and Mauritius’ tax system...). The result was a country that would rank 15th on the overall ease of Doing Business. So, Africans, learn from your neighbors and Switzerland will soon be behind you.

Grade inflation

Grade inflation is also the product of competition. Competition improves performance and mostly this is good: it leads to lower prices and shorter queues at the checkout. But the process has perverse results when the product is performance measurement, and the buyer is the person whose performance is being measured.

That's John Kay in the Financial Times, on why competition is not always good.

New SME newsletter

The new IFC e-newsletter “Outcomes” showcases IFC advisory work, and that of our partners, in promoting small business development in emerging markets. The focus will be on results sharing - both successes and failures. Subscribe now.

The debut September edition highlights new local banking markets in Bangladesh.

eChoupal: empowering the links in the value chain

The ITC Ltd. developed eChoupal program has beat out 134 other nominees to win the 2005 Development Gateway Award – and the $100,000 that come with it. The program has been praised for leveraging IT to virtually cluster value chain participants, allowing millions of Indian farmers to access all-powerful price and product information regarding their crops.

Since June 2000, over 5,200 eChoupal Internet kiosks have been established to serve 3.5 million farmers in 31,000 villages in India. At the kiosks, farmers learn management techniques, order fertilizer and other supplies less expensively, check market prices, and sell products online. As a result, earnings have increased up to 20%.

Private health insurance in Africa

The New York Times offers us 'Neglected poor in Africa make their own safety nets':

Plans in which neighbors come together and create their own makeshift health coverage are the rage in Africa, particularly in the continent's west. Here, the plans now have a significant presence in 11 countries and membership has grown beyond 200,000 people.

Some of these mutual health organizations, as they are known, include fewer than 100 beneficiaries. The tiny group negotiates with a local clinic and forges a better price for care. Others have linked dozens of community groups to produce sophisticated plans that cover 10,000 or more people and offer an array of services.

The article highlights the difficulty of getting government-run funds to pay out, and while the community 'microinsurance' funds are not without fraud either,

...the funds tend to regulate themselves. One requires members to visit fellow members who are hospitalized, in both a measure of solidarity and a double check that the person in the hospital bed is the one on the insurance card.

No word on how effective these funds really are, but of course they are passing a market test. HT to Marginal Revolution; the full piece is well worth a read. Here is Pablo's earlier post.

Anarchy and Invention

Our most popular discussion ever was sparked by a paper by Tatiana Nenova:

Somalia has lacked a recognized government since 1991 - an unusually long time. In extremely difficult conditions, the private sector has demonstrated its much-vaunted ability to make do. To cope with the absence of the rule of law, private enterprises have been using foreign jurisdictions or institutions to help with some tasks, operating within networks of trust to strengthen property rights, and simplifying transactions until they require neither. Somalia's private sector experience suggests that it may be easier than is commonly thought for basic systems of finance and some infrastructure services to function where govenrment is extremely weak or absent.

The paper is also reprinted in The Market for Aid.

Updated Asian development outlook

The Asian Development Bank has released an updated version of their 2005 Asian Development Outlook - originally released last April. This new version projects regional GDP to grow by 6.6% this year, slightly up from their original 6.5% prognostication. The highlight is an entire new section dedicated to the challenge of higher oil prices in a region of both energy guzzlers and net exporters.

The irresistible case for corporate governance

This is from a new note on the 'irresistible case' from the IFC/World Bank Corporate Governance Department:

Investors say they value corporate governance. And they put their money where their mouths are... Well-governed firms in Korea traded at a premium of 160 percent to poorly governed firms... Brazil-based firms with the best corporate governance ratings garnered 2004 P/E rations that were 20% higher than firms with the worst governance ratings.

Other resources on corporate governance are available.

Where is the Wealth of Nations?

The World Bank recently launched its new report, Where is the Wealth of Nations? - which has been called a “millennium capital assessment.”

Meant to challenge the common assumptions about how nations generate their wealth, the report offers new estimates of a country’s total wealth by including produced capital, natural resources, and the value of human skills and capabilities. The argument being that current wealth indicators fail to capture deteriorations to natural resources and the environment. 

   

The report confirms the worry of many that the world’s poorest countries are not on a sustainable path since they are so dependent upon their decreasing “natural wealth.” Although the companion booklet, Ensuring Environmental Sustainability, highlights some important exceptions – such as Mauritania and Botswana.

See the press release, or interviews with the authors.

Update: Resumen en español.

Low cost, high impact technology: Playpumps

The ultimate source of clean energy: children larking about. Roundabout produces water pumps that double as playground equipment. As children ride on the roundabout, they are pumping clean water into a tank.

IFC is backing the idea. The press release tells us that Roundabout...

...currently has 700 PlayPumps installed in remote communities in South Africa. The firm is now taking its proven model to Mozambique; the first Pump is in the ground with 99 more to be installed over the next year.

They also carry an HIV/AIDS awareness message.

Private education: will Europe be overtaken?

The Economist believe that Europe's state-run universities cannot compete:

America is not the only competition Europe faces in the knowledge economy. Emerging countries have cottoned on to the idea of working smarter as well as harder. Singapore is determined to turn itself into a “knowledge island”. India is sprucing up its institutes of technology. In the past decade China has doubled the size of its student population while pouring vast resources into elite universities. Forget about catching up with America; unless Europeans reform their universities, they will soon be left in the dust by Asia as well.

The idea of charging fees for university places remains hugely controversial in Europe, despite the fact that subsidising higher education is demonstrably regressive in many countries.

Unblocking business

The Economist has a nice piece on Doing Business today:

Heavy strictures on business often fail even on their own terms. In poor countries, stringent building codes do not always produce safer habitation; higher tax rates do not always pull in more revenue; and the most tightly regulated labour markets do not afford the best protection to workers. Often, such burdens simply drive firms and workers into the shadow economy, beyond the reach of inspectors, trade unions and the taxman.

But why does the report face opposition in some quarters?

“It is like sports,” says Simeon Djankov, an author of the report, “If you keep score, no one wants to lose.”

I suppose so, Simeon. Australia is the second-best place in the world for quick, efficient business start-up - and also has the second-best cricket team in the world, eh?

Is Britain’s tax regime too complicated?

No matter where we go, Doing Business raises local concerns: some British newspapers have been arguing that Britain’s tax regime is too complicated, and have seized on Doing Business as evidence. (Comments?)

That wasn’t why we went to London, though: we wanted to talk to the Department for International Development, who have been using the report as a basis for their policy advice. There’s another reason, of course: London is a key airport hub for Africa – and by the time you read this, we’ll be in Johannesburg.

Comments: less is more

Tyler Cowen at Marginal Revolution ran a little experiment as to whether comments should be open or closed on his blog. His conclusions:

1. Visitor stats rise considerably.  But this happens so quickly, I believe it is people hitting "reload" to read additional comments, rather than more readers.

2. The more that comments are regularly available, the more rapidly the quality of comments falls.  The quality of comments stays high when it is periodic, not automatic, and when we request comments specifically.

3. The quality of comments is highest when the matter under consideration involves particular facts and decentralized knowledge.  Posts which mention evolution, free will, or Paul Krugman do not generate the highest quality of comments.

Nice to have my suspicions confirmed. We will also have comments occasionally open. But if you can't wait to sound off about Doing Business, there's a discussion running.

China’s best places for business

1. Hangzhou  --  A Marco Polo favorite
2. Wuxi  --  Industrial hub near Shanghai
3. Shanghai  --  China's international business capital
4. Dalian  --  Popular among Japanese investors
5. Beijing  --  Hosting the 2008 Summer Olympics
6. Suzhou  --  Multinational manufacturing mecca
7. Ningbo  --  Big port rivals nearby Shanghai
8. Nanjing  --  Military city finds new success
9. Guangzhou  --  New airport boosts appeal
10. Shenzhen  --  Booming Hong Kong border city

This according to Forbes. At the country level, Doing Business ranks China 91 out of 155 countries globally.

Need more? - see David Dollar et al.: Improving the Investment Climate in China – A Tale of Five Cities (2003) and Improving City Competitiveness through the Investment Climate: Ranking 23 Chinese Cities (2004).

Does Doing Business suck?

The last couple of days have seen ample discussion of the Doing Business indicators, with most commentators gratifyingly complimentary.

But not everyone is persuaded. Robert Lawson at Division of Labour, for instance, also wants to improve the business environment but prefers surveys of businessmen to the Doing Business methodology.

So a word about what the Doing Business indicators aim to do. The World Bank is trying to relieve poverty, which in this case means persuading and advising governments to cut senseless red tape and improve the quality of economic institutions. Whatever merits a survey of businessmen may have, it will not tell a reformer what to do. A survey which says that Redtapia's courts do not respect contracts is of limited help.

What Doing Business will tell reformers about - say - contract enforcement is:
- Which procedures are causing the delays;
- Specifically, which laws or regulations would need to be changed to improve things;
- Which other countries have better alternatives.

Incidentally - but importantly - because the Doing Business numbers are based on a close reading of the laws, coupled with detailed discussions with experts, they can actually be proved wrong, and on a few occasions have been shown to be wrong. That's a valuable check on the data. A survey result is 'not even wrong' - how could the result be challenged?

Chapter 1 of Doing Business in 2004 is excellent on these issues, and I can say that with a clear conscience because it was written before I had anything to do with the report.

Comments? Take them to our online discussion.

Online discussion on Doing Business in 2006

Three members from the Doing Business team will be moderating an online discussion on the new 2006 report. They invite you to join in and share with them your questions, comments, suggestions or criticisms. The discussion will run through October 3 and all are invited to participate.

Nominations for 2006 World Business Awards

IBLF, UNDP and the ICC are seeking nominations for the World Business Awards in support of the Millennium Development Goals. The nominations process was launched September 12. See the explanatory brochure or nominate a deserving project - you have until December 31, 2005.

The diary of Angelina Jolie

...(and Jeffrey Sachs). The two have teamed up with MTV to document a recent trip through Africa to highlight the MDGs. The show debuts tonight in the US. (via AdamSmithee)

Also, see Sach's Financial Times blog - yesterday he discussed "private initiatives at the World Summit."

Will the Millenium Development Goals matter?

In an argument waged on yesterday’s International Tribune op-ed pages, Bunker Roy claims that they won’t:

Any goal that is driven from the top by international donors and governments not accountable to the communities and without financial transparency is doomed to fail… under the present top-down model, with the absence of a global grass-roots movement with the communities as equal partners, the goals have been broken up compartmentally into project mode, to suit donors and governments.

Kemal Davis argues that they will:

The goals stipulate with needed precision what it is we are setting out to do, and allow us to chart progress toward these interlocking aims, year after year, country by country, to ensure that these promises are kept…. [they] provide the best available framework for fulfilling the promise by world leaders at the summit in 2000 to "spare no effort to free our fellow men, women and children from the abject and dehumanizing conditions of extreme poverty."

The Economist says that they can barely be measured, let alone met - so what then are they for?

A discussion that will surely continue at the 2005 World Summit, which kicks off today.

"A guide to making poverty history"

That is how The Times has graciously referred to the just released Doing Business in 2006. They seem to love the content, though they are not huge fans of the title:

Doing Business in 2006 is a dry-as-dust title; but the compelling, often disturbing stories it tells about the destructiveness of red tape, and about the power of simple, inexpensive reforms to transform people’s prospects, are of vastly greater practical use than the collected sermons of Jeffrey Sachs.

Getting richer

An early sign of wealth is that once-attractive jobs are left unfilled. Indian call-centres are said to be struggling to recruit, says The Economist:

Finding and retaining qualified workers has become the industry's biggest medium-term worry. It may, as a new report by Gartner, a consultancy, puts it “stall the offshore call-centre boom”. The infant industry has grown explosively. Youngsters have hopped from job to job. Staff-attrition rates for the industry as a whole have climbed to 45-50% a year. Entry-level salaries have now reached about 10,000 rupees a month ($230), considered very high for a first job.

Last year the Financial Times reported a similar phenomenon in Chinese 'gold coast' sweatshops:

Last year, Yang Li left Luzhou, her quiet home in China's Sichuan province, to work in a lock factory about 1,000km awayin the bustling Pearl River delta just north of Hong Kong. After a month of polishing locks for 13 hours a day, she returned home, exhausted. Today, Ms Yang runs a hair salon in Luzhou and is relieved that her days as a labourer are over. "Every day at the factory was just work, work," she says. "My life here is comfortable. I can close the salon whenever I want." 

Fashion à la conservationist

Netherlands-based Rag-Bag turns the plastic bags littering Delhi streets into designer clothes you can wear -- granted, perhaps they are not the most shockingly beautiful threads. (via B2Day)

The worst business regulations in the world

Doing Business in 2006 was published today (midnight GMT), tracking the state of red tape across the world with the usual sparky reporting and jaw-dropping data. (OK, I'm biased: my name is in the acknowledgements.)

There are many wise things to be said about this data, and I'll try to say them over the next few days. But since this is a blog let me go for the cheapest headline. The top ten business environments in the world, as measured by the 'Ease of Doing Business index':

1. New Zealand
2. Singapore
3. United States
4. Canada
5. Norway
6. Australia
7. Hong Kong, China
8. Denmark
9. United Kingdom
10. Japan

Now for the worst ten:

146. Mali
147. Lao, PDR
148. Congo, Rep.
149. Togo
150. Niger
151. Sudan
152. Chad
153. Central African Republic
154. Burkina Faso
155. Congo, Dem. Rep.

As we've discovered in previous years, it seems that the poorest countries are also the ones with the most intrusive regulations. Analysis to follow from both of us and from our guest blogger, Iva, but meanwhile, use this new tool to create your own rankings.

Update: Join the online discussion on DB in 2006.

New guest blogger: Iva Ilieva Hamel

Doing Business in 2006: Generating Jobs is being launched tonight, so Iva of the Doing Business team will be guest blogging with us for the next few days. She will be traveling with World Bank-IFC PSD VP Michael Klein to London and Johannesburg to launch the new report, and will be sharing with us her insights along the way. Our first guest blogger! (and hopefully many more to come)

Update: Join the online discussion on DB in 2006.