Asian Themes in Social Sciences Research

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

Mon, 03 Jun 2024 00:00:00 +0000

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.

Digital transformation: A pillar of structural transformation of Moroccan economy

Mustapha Amzil, Abdelhamid Ait Bihi, Amina Tourabi, Lahoucine Asllam — Mon, 12 Aug 2024 00:00:00 +0000

This article examines the crucial role of digital transformation in the success of the Moroccan economy's structural transformation (ST) process between 2015 and 2023. Based on this period, the study captures the hollow effects of digital transformation on Morocco's sustainable development. Analysis of this time series also enables us to identify the opportunities and challenges associated with implementing digital transformation in the Moroccan economy. It also offers valuable insights for guiding sectoral public policies and development strategies, maximizing the benefits of the digital revolution while minimizing potential risks. After establishing the theoretical foundations of ST, the study explores the complex dynamics between observed socio-economic mutations and the adoption of advanced technologies in Morocco. These theoretical frameworks help contextualize the empirical study that follows. The study continues with an in-depth econometric study, estimating a non-linear autoregressive distributed model (NARDL). This estimation aims to analyze the effect of various variables, such as high-tech exports, gross fixed capital formation, diversification of production and export structures, as well as GDP per capita in constant dollars, on the economic complexity index considered in this study as a proxy for the ST process of the Moroccan economy. The outputs of the econometric study highlighted the significant importance of these variables in the success of the Moroccan economy's ST process. These results demonstrate the potential of digital transformation as a catalyst for ST in the Moroccan economy, paving the way for a resilient and more dynamic economic future for Morocco.

Possibilities to escape the rental trap

Mar Wolfgang Mixa, Kristin Erla Tryggvadottir — Thu, 03 Oct 2024 00:00:00 +0000

Despite a resurgence of economic activity since the 2008 financial crisis and longstanding government policies promoting homeownership, the percentage of renters has remained stable over the past decade despite most preferring homeownership. This study examines the time required for various rental market groups to save for a down payment on an apartment in the capital area from 2011 to 2022. We also assess the potential impact of a government program allowing certain low-income groups to set aside just 5% of a property’s price as a down payment. The focus is on people in the lowest 20^th percentile group. Using data on wages, taxes, compulsory pension contributions, and spending patterns, we analyze how much each group can realistically save, considering both minimal (bare) and typical consumption benchmarks. This analysis reveals how much each group can save for a down payment. Our findings show that despite economic prosperity and wage increases outpacing the consumer price index (excluding housing costs), the time needed to save for a down payment in 2022 remains nearly the same as in 2011 due to rising housing prices. Single parents face the most difficulty saving for a down payment, but the 5% down payment program offers a more realistic path to homeownership. The implications are that government policies should focus on controlling house prices and continuing the 5% down payment program to enhance homeownership opportunities.