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Abstract - Investigating the Link between Economic Complexity Index and Monetary Policy Lending Rates in Selected Sub-Saharan African Countries
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Abstract: This article investigates if there is a link between economic complexity index and monetary policy lending rates in selected Sub-Saharan African countries. Economic complexity index (ECI) as a measure of productive capabilities and a mix of sophisticated products that countries export, has been found to influence some economic indicators such as economic growth and inequality. Little attention has been paid to ECI’s link to lending rates in monetary policy bank lending rate transmission mechanism. In this paper, the ECI-lending rate nexus has been investigated using a panel autoregressive distribution lag methodology. Results indicated a long-run significant relationship with the Kao and Johansen combined cointegration. It was further illustrated in the long-un that ECI estimates have a negative and significant impact on monetary policy lending rates. The series could correct to equilibrium at a significant rate of 25%. These results provided new insights needed for appropriate development economic policy to reduce monetary policy lending rates. Keywords: Monetary policy transmission mechanism, economic complexity index, panel auto-regressive distributed lag model, Sub-Saharan Africa. |
Abstract - Lessons from Foreign Owned Spaza Shops in South African Townships
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Abstract: In 2014, the World Bank pronounced how the informal sector is probably responsible for half of the GDP in developing countries. This sector can no longer be ignored as it is embedded in most developing countries’ economies. In a country like South Africa, the informal sector is a gateway to economic freedom where the historically deprived groups were left behind and could not participate in the formal economic sectors, as they would have liked. This was due to racially skewed policies of the apartheid regime. The country saw black racial groups marginalised from acquiring appropriate skills, education and resources to allow them to participate in the formal economy. The barrier to entry into formal economies resulted in the significant rise of the informal economy. One of the most prevalent business forms in this sector has been Spaza Shops. In fact, in South Africa, Spaza Shops have become synonymous with the informal sector. Post-apartheid, with the opening of the country’s borders over the years, there has been an increase in foreign owned Spaza Shops both legally and illegally, at the expense of locally owned ones. Using an exploratory research design, this paper sought to uncover various practices and procedures that have been accredited to the success of foreign owned Spaza’s in townships. Through qualitative engagement with relevant literature published over a period of six years, a relationship between foreign owned businesses and locally owned businesses in the townships of South Africa was investigated. The study outcomes identified motives for increased and successful foreign owned businesses in townships. These are Networking and Economies of Scales; Socio-Economic Motivators; Geographic Location; Financial Management, Entrepreneurial Orientation and Business practice. All of these motives are seen as equally important and can be used to upskill and motivate local informal traders to be as competitive within the township economy. Keywords: Entrepreneurship, apartheid, xenophobia, innovation and township economy. |
Abstract - Value Added Tax: An Instrument used in some African Countries to Meet Fiscal Objectives
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Abstract: This article aims to evaluate the extent at which VAT is used as an instrument by countries to meet their fiscal deficit and meet the needs of their citizenry. Taxpayers pay taxes based on their ability to pay and with an anticipation that they will receive services in return to their contribution from government. The VAT due to its buoyancy nature contributes sizable amount of taxes which alleviate the financial burden of countries in meeting the financial obligations. Numerous kinds of literature demonstrate that whenever countries experience any budget shortfall they always look for fiscal remedies in either introduction of VAT or changing the rate of VAT. South Africa recently changed its long term rate of 14 % VAT to 15%. This article is conceptual in approach and uses the literature to argue that Value Added Tax (VAT) can be used as an effective instrument to meet fiscal objectives in some African Countries. Countries have the responsibility to ensure that their subject contributes to taxes which amongst others should in the form of VAT. As in the case of other taxes, the taxes are used to meet the fiscal obligation a country faces. The paper concludes that many countries that have introduced VAT have managed to meet their fiscal obligation due to high revenue contribution that have emanated from it, making the VAT the best tax methods to enable the country to meet their fiscal obligations. Keywords: Fiscal, Fiscal Objectives, Instrument, Value Added Tax. |
Abstract - Evaluating the Impact of Electronic Payment Channels on Sustainable Financial Inclusion in Nigeria
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Abstract: The underlining drives of many financial reforms were to motivate digital banking culture in order to achieve sustainable financial inclusion. It is not very clear the extent to which financial innovation reform has advanced financial inclusion in Nigeria. Similarly, some issues closely linked with digital finance have not been exhaustively addressed in the literature. This research paper therefore evaluated the effect that electronic payment channels had on financial inclusion in Nigeria. Quarterlized data obtained from the statistical bulletin of Central bank of Nigeria were used. The Autoregressive Distributed Lag Model was adopted and used for our estimation. Digital financing channels were not only significant but at same time positive with the financial inclusion variables under investigation. However, the observed financial inclusion may not have delivered access to all because the channels are elitist. The study advocates for a policy reform that takes care of structural rigidities to fully accommodate the excluded. Keywords: Financial Inclusion, Electronic Payment, Financial Deepening, ARDL. |
Abstract - Displacement Effect on Local Traders by Emerging Markets: Durban Townships
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Abstract: The propounded omnipresent of township malls and aggressive suppliers’ expansion into the emerging markets epitomises the greater potential to create jobs and improve the economic transformation. However, it is important to note that these developments could trammel local traders’ economic prosperity than abrupt veracity of growth and symbiotic trajectory. While the encroachment of mainstream retailers into South African township markets offers business opportunities and economies of scope to consumers. The objectives which underpinned this study: to explore local township traders’ perceptions on the displacement effects from shared value-creation in emerging markets; and to establish the extent of the transformation of retail enterprise development and the displacement of local traders. The study used quantitative methods to analyse the data collected from 301 respondents to amass primary data. The study found that, while local traders appreciate the transformation and development of the townships brought about by shopping mall development, their businesses have been displaced by the emergence of township malls. Keywords: Emerging markets, local traders, displacement effect, and shared value systems. |