Directions in Development - Private Sector Development

Pakistan's population is growing and becoming more urbanized. By 2020, Karachi and Lahore will each have a population of well over 10 million people and several other cities will have a population of at least one million. These trends offer both risks and opportunities. Badly managed urban centers with poor services and slim opportunity for gainful employment could become centers of discontent and social conflict. Alternatively, properly managed and well-connected cities can help firms become more competitive, and with the right set of policies, promote industrialization and life-changing employment opportunities. In order to capitalize on these opportunities, Pakistan will need to take decisive steps to deepen the pool of skills, strengthen the commercial environment, upgrade infrastructure, diversify production, and climb up the technology ladder. Revitalizing Industrial Growth in Pakistan: Trade, Infrastructure, and Environmental Performance addresses ways in which Pakistan can revitalize its manufacturing by reducing the cost of doing business, improving the investment climate, and strengthening institutions to facilitate the flow of people, goods, and ideas and thus stimulate medium-term growth and job creation. Such revitalization is sorely needed to place the country on a sustained path of high economic growth. The authors lay out priorities and strategies for 'greening' Pakistan's industrial growth and provide a comprehensive analysis of issues in the debate on this strategy. They examine the ways in which Pakistan can encourage and assist its private sector to fill the void in low-skilled labor-intensive manufacturing left by other economies--and do so while creating and distributing new wealth. To increase the chances of success, appropriate actions will need to come from different actors in government, the private sector, and civil society. This book will be of interest to government officials and academic researchers working in the fields of industry, the environment, and energy, as well as to the general public.

Unlocking Asia's Economic Potential Through Industrial Clusters What drives economic growth in Asia? This study explores the power of industrial clusters-geographic concentrations of interconnected companies-in fostering innovation and competitiveness. Discover how these clusters, from Silicon Valley to Hsinchu Park, have fueled regional economies and what lessons they hold for future development. Is your region ready to thrive? Growing Industrial Clusters in Asia offers practical guidance for: - Understanding the nature and dynamics of successful clusters - Implementing effective policy measures to build and sustain clusters - Leveraging the experience of established and emerging clusters - Navigating the challenges of globalization and regional competition For policymakers, urban planners, business leaders, and researchers, this is an insightful resource for unlocking Asia's economic potential.

Over the past decade, Egyptian women have made significant progress in improving their economic and social status. The government's commitment to women's empowerment is strong at the highest political levels. Yet continued disparities remain in the country's labor market and in the business arena. 'Egyptian Women Workers and Entrepreneurs' analyzes these disparities and makes recommendations for needed change to ensure a level playing field. This groundbreaking book brings together data and extensive evidence on barriers to women's entry into business in Egypt and makes the case for actions to ensure gender equality. This book is based on a study that the Egyptian Ministry of Investment and Ministry of Manpower and Migration, and the National Council for Women requested to assist in analyzing the factors that influence women's low participation rate in economic activities, including the labor market and entrepreneurship. 'Egyptian Women Workers and Entrepreneurs' aims to fill the significant research gap on these subjects in Egypt as well as to provide suggestions to address continued gender inequalities. This book will be useful for donors, nongovernmental organizations, and researchers working to address gender barriers.

Nigeria has a bold national vision of becoming one of the world's top 20 economies by 2020. However, despite being the 8th most populous country in the world, it ranks 41st in terms of GDP and 161st in terms of GDP per capita. Nigeria has long depended on oil for its exports and government revenues. This dependence has led to rent seeking and a reluctance to examine potential avenues for economic diversification. The authors of 'Knowledge, Productivity, and Innovation in Nigeria' believe that the goal of becoming a top-twenty economy can only be achieved if Nigeria makes the transition to a new economy rooted in the 21st century that harnesses the power of knowledge and avoids a static oil-based growth strategy. Knowledge has always been central to development, but new technologies have made it globally accessible. Countries such as the Republic of South Korea, India, and the United States that have exploited new technologies and know-how have pushed their innovation and productivity frontiers. Countries that have failed to do so risk remaining mired in poverty. In order to achieve Vision 2020, Nigeria must move beyond the stop-start patterns of oil-based development that have characterized it since independence. It must create a stable and prosperous economy based on a critical mass of knowledge workers. Knowledge, Productivity, and Innovation in Nigeria examines how Nigeria can prepare for this century and where its leaders can focus to achieve their vision, presenting the experiences of other countries from which Nigeria can learn.

Light Manufacturing in Vietnam makes the case that, if the country is to continue along a rapid economic growth path and create jobs, it must undertake a structural transformation that can lift workers from low-productivity agriculture and the mere assembly of imported inputs to higher-productivity activities. Vietnam needs to address fundamental issues in the manufacturing sector that, until now, have been masked by economic growth. The book shows that there is a dichotomy between domestic enterprises and enterprises supported by foreign direct investment. The dominant state-owned enterprises and foreign-invested firms are often not integrated with smaller, domestic firms through backward or forward links in the use of domestically produced inputs or intermediate products. Growth in the domestic light manufacturing sector has arisen from the sheer number of micro and small enterprises rather than from expansion in the number of medium and large firms. As a consequence, final products have little value added; technology and expertise are not shared; and the economy has failed to move up the structural transformation ladder. This structure of production is one of the reasons Vietnam's rapid process of industrialization over the last three decades has not been accompanied by a favorable trade balance. Policy measures to address problems in competitiveness in Vietnam must confront the dual structure of the light manufacturing sector, while raising the value added in the industry. To that end, measures must be taken to nurture the expansion of small domestic firms, while helping these firms to achieve greater productivity through trade integration. This will require improvements in labor skills and technology and in the quality and variety of products able to compete with imports. Policies to reduce the role of the state-owned sector, promote trading companies, encourage clustering and subcontracting, and raise foreign and social networking are important in this respect. To boost the value added of its goods, Vietnam needs to integrate the supply chain in assembly activities by investing in the upstream production of the goods in which it has a comparative advantage in production and in which it has already established a market share, such as agribusiness, garments, and wood. Unlike downstream activities, however, the production of the associated raw materials and intermediate goods is capital intensive and technology driven, and it requires skilled labor. Inviting foreign direct investment into these areas and reforming education and vocational systems are the best means to reach this goal. For this reason, the government should launch a complete review of the incentives for foreign direct investment to focus on upstream production and on bringing in capital and technical expertise, while improving labor and entrepreneurial skills. Based on this analysis, Light Manufacturing in Vietnam proposes concrete policy measures to increase employment and spur job creation by addressing sector-specific constraints. The book presents a set of practical recommendations for policy makers to identify, prioritize, and remove the most serious constraints in each sector. This book will be valuable for policy makers, entrepreneurs, workers, professional economists, and anyone interested in economic development, industrialization, and the structural transformation of Vietnam and of developing countries.

Discover how businesses worldwide combat crime and violence to foster economic growth. This insightful analysis explores the impact of crime and violence on the private sector and offers strategies for firms to cope and thrive in challenging environments. Drawing on case studies from Latin America, Africa, and Asia, it reveals the economic costs, innovative coping mechanisms, and the role of public-private partnerships in creating safer, more prosperous communities. Learn how businesses in Brazil, Colombia, Jamaica, Mexico, Nepal, and Rwanda are adapting to overcome security threats and promote sustainable development. This resource is for policymakers, business leaders, and development practitioners seeking to understand and address the root causes of crime and violence while fostering economic resilience. Gain practical insights and actionable strategies to empower firms and build stronger, more secure economies.

'Competitiveness and Growth in Brazilian Cities' addresses the question of what cities can do to improve economic performance and create jobs. The topic is explored through a review of theories and policy options for city competitiveness, preliminary benchmarking of Brazilian cities, and case studies of two urban areas in Northeast Brazil-the Cariri region, Ceará and São Luís, Maranhão. The book concludes that to be competitive, cities need to reduce the cost of doing business by improving their services and infrastructure and by reducing bureaucracies. But for a middle-income country such as Brazil, which needs to be economically competitive in a globalized environment, this is not sufficient. Cities also need to add value to local businesses. A crucial part of their strategy should be to create and sustain an environment that stimulates local firms to innovate and learn from each other, to nurture the creation of synergies generated by the interconnected economic clusters in the city, and to provide incentives for all local players to continuously upgrade their level of competitiveness. With regard to local policy actions, this book highlights the cluster approach to competitiveness, with its focus on facilitating private-sector collaborations for collective efficiency. 'Competitiveness and Growth in Brazilian Cities' provides many examples of actions that may be undertaken at the local level, emphasizing the critical importance for cities to pursue a unique strategy based on their comparative and competitive advantages.

The central challenge facing the government of Armenia today is the need to transform its economic infrastructure into one that, in the medium term, is resilient to external shocks. To do so, it needs to find new sources of long-term economic growth that will enable it to become an upper-middle-income country. Crucial to achieving this objective is a dynamic and vibrant private sector, and in particular entrepreneurial activity, which generates new businesses and fosters competition and economic growth. Fostering Entrepreneurship in Armenia uses data and in-depth case studies to identify the determinants of high-growth entrepreneurial activity. It finds that, while there is a higher level of entrepreneurial activity in Armenia compared with other countries in the region, a number of constraints to the growth of entrepreneurial and innovative activity remain. Based on these findings, the book outlines broad policy directions for improving the business environment, providing access to finance, developing skills, increasing access to markets, incentivizing firm-level research and development, and raising awareness, and it identifies priority areas for government action. The issues discussed in this book will be of particular interest to policy makers who are aiming to achieve higher growth and job creation through entrepreneurship, as well as to development practitioners and those in the private sector.

Entrepreneurial activity is pivotal to the continued dynamism of the private sector, with the generation of new businesses fostering competition and economic growth. This study uses data and in depth case studies to help make the environment in Georgia more conducive for high-growth entrepreneurial activities.

Job creation and productivity growth are at the forefront of the global development agenda. This is particularly relevant for Azerbaijan, whose government faces a central challenge to create conditions that will facilitate growth in nonoil tradable sectors. This study seeks to identify determinants of high-growth entrepreneurial activity. The stusy uses data from the new 2012 World Bank Entrepreneurship Survey conducted to gauge new firm growth in the formal sector in Azerbaijan and data from World Bank Enterprise Surveys to analyze innovative activity in existing firms. It includes detailed case study analyses to complement these findings. The study finds that high-growth entrepreneurialism is low in Azerbaijan and that innovative activity among firms is very low. Several factors hinder business growth and entrepreneurship. These include a lack of competition, financial systems that are not conducive to business development and a lack of industry-relevant skills. While outlining broad policy directions in areas namely improving competition and access to information, improving the business environment, increasing access to finance, developing skills, increasing access to markets, incentivizing greater in-firm research and development and raising awareness it lays out some priority areas that the government could embark on. The government could remove bottlenecks that impede entrepreneurialism in the general business environment and design new financial policy instruments to foster entrepreneurship and innovation. We hope that the issues discussed and the dialogue initiated during the course of this study would lend itself to policy design to foster high-growth entrepreneurship with a view to higher growth and job creation in this highly globalized world.

The World Bank, Japan International Cooperation Agency (JICA) Research Institute, and the Foundation for Advanced Studies on International Development (FASID), in collaboration with researchers affiliated with the African Economic Research Consortium (AERC), recently conducted a study on Africa's domestic enterprises to improve the understanding of the constraints micro and small enterprises in Africa face in improving productivity and expanding their markets. In Africa, there are stark performance gaps between domestically owned enterprises and foreign-owned enterprises in terms of sales performance, productivity, and ability to reach distant markets. Among others, size appears to be a dominant factor in explaining the gap. Against this background, the study analyzes how naturally formed industrial clusters-concentrations of enterprises engaged in same or closely related industrial activities in specific locations-could potentially mitigate constraints Africa's micro and small enterprises face and enhance their business performance. The study is one of the first comprehensive quantitative inquiries on industrial clusters in Africa. The analysis specifically focuses on the role of spontaneously grown clusters of light manufacturing industries based on a set of original case studies of industrial clusters conducted for this research project. One of the key findings from the case studies was that cluster-based micro and small enterprises are performing better than similar micro and small enterprises outside of the clusters in terms of sales performance and ability to reach distant markets. Market access is a leading reason for cluster-based enterprises to choose their current locations. However, cluster-based enterprises face another set of unique growth constraints. By the very nature of spontaneous agglomera¬tion, new enterprises continue to flow to the clusters seeking the profit opportunities and better access to markets at such locations. The result can be intense competition in addition to increased congestion. Space constraints often impede growth within clusters. The lack of alternative locations available for industrial activities in the same cities, generic infrastructure bottlenecks, and unclear zoning policies and their unpredictable changes limit firms' location choices and constrain their mobility. While competition should improve efficiency, lack of capacity among those competing cluster-based enterprises to invest and innovate does not generate growth out of the competition. The vast majority of naturally formed clusters of light manufacturing industries in Africa are still at a "survival" level, where agglomeration externalities are only limited to expand quantity but not quality as we observe in more advanced innovation-oriented clusters in elsewhere in the world. Existing studies on such natural industrial clusters in Africa have found that the lack of managerial skills among entrepreneurs running micro and small enterprises is a major constraint for innovation and growth in the clusters. As a part of this study, pilot managerial skills training programs were conducted in two industrial clusters on an experimental basis, where a group of randomly selected entrepreneurs within the clusters were given three-week long crush course of based management such as bookkeeping, marketing, business planning, and production management. The impact evaluation of the experiments showed significant positive impacts of the training programs on value added and gross profits of enterprises. Raising the current survival-type industrial clusters, which have been formed as a coping mechanism to weak investment climate, into more dynamic innovating clusters will be an important avenue for fostering growth of micro and small enterprises in Africa.