Dennis Leech and Robert Leech
12th January 2005
Abstract
We consider some of the implications of a proposed reform of the voting system of the IMF in which EU countries cease to be separately represented and are replaced by a single combined representative of the European bloc. The voting weight of the EU bloc is reduced accordingly. We analyse two cases: the Eurozone of 12 countries and the European Union of 25. Using voting power analysis we show that the reform could be very beneficial for the governance of the IMF, enhancing the voting power of individual member countries as a consequence of two large countervailing voting blocs. Specifically we analyse a range of EU voting weights and find the following for ordinary decisions requiring a simple majority: (1) All countries other than those of the EU and USA unambiguously gain power (measured absolutely or relatively); (2) The sum of powers of the EU bloc and USA is minimized when they have voting parity; (3) The power of every other non-EU member is maximized when the EU and USA have parity; (4) Each EU member could gain power - despite losing its seat and the reduction in EU voting weight - depending on the EU voting system that is adopted; (5) The USA loses voting power (both absolutely and relatively) over ordinary decisions but retains its unilateral veto over special majority (85%) decisions (as does the EU bloc).
C.M. Anyanwu
13th November 2004
Abstract
This study examines the outreach performance of microfinance institutions (MFIs) in Nigeria, based on a survey of ten major MFIs. The findings indicate that the operations of MFIs have grown phenomenally in the last ten years, driven lagely by expanding informal sector activities and the relucance of banks to fund the emerging micro enterprises. The financial services provided by the MFIs have neither been given any publicity nor captured explicitly in the official financial statistics. The study also reveals that the sub sector faces a number of challenges which have been addressed in this paper. They include the urgent need to approve and implement a policy framework that would regulate and standardise MFI operations; accessing medium to long term sustainable commercial sources of fund, such as SMIEIES and DFI funds and increased mobilisation of savings; and shifting a good proportion of credit portfolio to the promotion of real sector activities, especially in agricultural and manufacturing.
Laura dos Reis
13th September 2004
Abstract
This paper proposes the implementation of a fiscal insurance scheme for the two currency unions of the CFA-franc zone, the West African Economic and Monetary Union (WAEMU) and the Central African Economic and Monetary Community (CEMAC). A fiscal insurance mechanism would help to cushion for transitory shocks and at the same time reinforce the monetary union’s long-term viability. The paper proposes a basic framework for a fiscal insurance contract of 70 percent of coverage level for shortfalls in cyclical revenues owing to terms-of-trade shocks as a benchmark and then, analyzes different coverage levels and re-payment options in response to incentive problems –i.e. moral hazard and free riding. The paper presents numerical simulations of the initial resources required to implement a group insurance scheme and demonstrate that they would be lower than the required under a self-insurance arrangement. In addition, for particular country cases, each country can be better off under group insurance if the initial fund resources are redistributed in accordance with size and volatility. Finally, the paper analyzes what would be the initial buffer fund needs if the scheme had been implemented in 2003, and also, what could be the role for international organizations together with regional contributions in financing this scheme.
E.K.Y. Addison
3rd September 2004
Abstract
This paper presents Balance of Payments (BOP) estimates of private unrequited transfers (remittances) for Ghana. It shows that the level of private unrequited transfers increased significantly from US$201.9 million in 1990 to US$1,017.2∗ million in 2003. Total transfers have increased from just over US$410 million to US$1,408.4 million over the same period reflecting mainly the increase in private unrequited transfers. The study also found that private transfers are much bigger and more stable than Official Development Assistance (ODA) and Foreign Direct Investment (FDI) over the period 1990 - 2003. Also remittances have been increasing more than proportionately compared to GDP and exports earnings. A new reporting format introduced in 2004 has led to a significant improvement in the balance of Payments estimation of remittance flows into the Ghanaian economy