Oluyomi Ola-David Insights

Quantitative easing, QE, is a monetary policy means to an end – stimulating growth in the economy. It is an extraordinary tool employed by central banks to boost an economy when tempering interest rates yield little or no desirable results. In order to maintain satisfactory economic growth rates, a central bank may decide to raise or lower interest rates. Lowering interest rates tends to lower savings and encourage consumption spending and investment spending. In the event that a lowered or close-to-zero interest rate does not rouse aggregate demand as expected, a central bank may decide to ‘pump’ money directly into the financial system; this is what QE is about. Ordinarily, a central bank may adjust interest rates to put a check on inflation. For instance, when corporates scale back on investment due to uncertainties about the future, a central bank can reduce its lending rates. A reduction in the rate at which banks and other financial institutions may lend from the centr

Recession is costly and it happens in all countries and at various points in the global growth trajectory. A recession simply indicates a slowdown in economic activity in a domestic economy or an average slowdown in global economic activity if it is on the global scale. Broadly, a recession is characterized by a contraction in domestic output and all components of the aggregate demand function – consumption, investment, government spending and net export activity. The observable decline in real income, real GDP, industrial production, employment, sales activities across an economy could last more than a few months . It usually begins with a contraction after a peak and ends after an economy reaches a through. When severe and prolonged, recession results in a depression. An economic slowdown characterized by a recession can be triggered by a variety of phenomena. Based on observable cross-country economic experiences over time, there are several indications that a domestic rec

Developing countries, usually considered ‘latecomers’ in development, can create learning opportunities for themselves through channels of knowledge diffusion and technology transfer such as international trade and foreign direct investment.  For instance, ownership-specific advantages of multinational corporations, which make up the majority of large corporations in developing countries, could spill over to the domestic environment through consciously built learning relationships (in forms of forward and backward linkages). Mauritius is an African success story of structural transformation resulting from export-oriented FDI stimulated through the creation of special economic zones. Now that foreign investment promotion has become central to the industrial policies of most African economies, it is important to evaluate how much of the positive trends in FDI inflows are associated with local learning and improvements in local ways of doing things. Put differently, is FDI to

As I reminisce on the history of Independence in various African states, the glamour and the euphoria of liberty, with particular interest in the experience of Nigeria – the land of my birth. I am reminded of the celebration that ensued upon the expulsion of Mr. Jones and his men from the Manor Farm in George Orwell’s Classic, 'Animal Farm ’. In a speech motivating the animals to fight for their freedom, Old Major painted on the minds of his fellow ‘comrades’ a picture of a new world, which they could only access and possess after their gaining Independence from the oppressive rule of Mr. Jones and his likes. Oh how they relished the allure of freedom! Freedom from misery and slavery, which comes with an opportunity to own all they would ever produce without fear of external subjugation. Almost overnight every animal would become rich and free! Little did they know, except for the ‘cleverer’ of the animals, that following the eviction of an imposed master and a d

Against the background of the recently adopted Sustainable Development Goals, it is evident that there is a global will to make a success of the development process across countries. However, individual countries need a will to prepare for sustainable development. This speaks to the inevitable role of national development planning in the development process. While embracing market liberalization strategies and other popular policy propositions of international financial institutions, for instance, governments must keep in mind that the market does not have all the answers. Particularly so in developing countries of Africa where living standards are low, institutional frameworks are weak, income inequality is high and in-country spatial inequality is widespread. Zambia is one African country among several which has experienced woes associated with a blind adoption of ‘Invisible Hand’ policy options. Its fourth development plan was aborted at a point when it felt the time was

Beginning today Friday 25 th through Sunday 27 th September 2015, Heads of State and Government and High representatives will meet at the 70 th session of the United Nations General Assembly in New York to ratify the blue print of the post-2015 Development Agenda – Sustainable Development Goals. The 2030 Agenda for Sustainable Development focuses on transforming the world with a focus on 5 Ps – People, Planet, Prosperity, Peace and Partnership. The blueprint is indeed a product of conscientious consultations involving various stakeholders deliberating and debating various thematic and sub-thematic issues. The Task Force improved on the consultative processes that birthed the MDGs. Consequently, the SDGs are a product of wider and more inclusive consultations on elements essential to creating the World We Want by 2030. Also, in many ways the 2030 Agenda for Sustainable Development seeks to build on the Millennium Development Goals and complete what it could no

By the 2014 rebasing of its GDP, Nigeria became Africa’s largest economy trumping its long time contender, South Africa. Amongst several things, the significant growth implies changes in the sectoral contribution of domestic output and employment. Conventionally, for a developing country context it is expected that international trade, foreign direct investment, industrial policy and global price fluctuations would have contributed to the shifts in the distribution of factors of production and final output. Given the uninclusive nature of the impressive surge in output, it is important to investigate what sectors accounted for the structural change. Using historical data on the Nigerian economy, Oyebanke and I examined (in a forthcoming paper) the contribution of foreign direct investment to structural transformation. Specifically, in the paper we provided answers to the following questions: What are the sources, nature and characteristics of the structural change

At first, when I was contacted to be a panelist at AAI’s State of Education in Africa Conference I was very hesitant. However, I accepted the offer after wide consultations, also because you could not convene a conference on the State of Education in Africa without a special reference to Covenant University – a leading Christian Mission University in Africa’s biggest economy. The Conference attracted other thought leaders and visionaries including Professor Pat Utomi, Ndidi Nwuneli, Professor Dorayi Aminu, Devang Vussonji, Professor Julie Ibiam, Iyinoluwa Aboyeji of Andela amongst others. Panel discussions addressed issues on: ‘Teacher Training’, ‘Reforming Science and Technology Education in Africa’, ‘Spotlight on Vocational and Technical Training and Higher Education’, ‘Early Childhood Education’ and ‘Global Best Practices in Education’.  I participated in the panel on ‘Teacher Training: Equipping new educators with the tools they need for success’, which was moder

Inclusive growth is one of the recent concepts in development parlance. A drive for inclusive growth focuses on creating productive opportunities while ensuring there is equal access by all to those opportunities. Therefore, if growth is to be inclusive, it must consider the participation of every segment of society particularly the marginalized and vulnerable. Nigeria’s real estate sector has continued to grow at an impressive rate within the past decade. According to the National Bureau of Statistics, the value of Nigeria’s real estate market has grown from N 1.4 trillion in 2011 to N 6.5 trillion in 2015. Notably, the residential real estate sub-sector’s contribution to GDP increased from 7.7 per cent in 2012 to 11.1 per cent in 2014. With over 80 per cent of Nigeria’s adult population living in rented accommodations, the sub-sector hold tremendous potential for growth. The Managing Director of The Infrastructure Bank (TIB) alludes to this in a report that projects the

Often times when development experts propose solutions to the problems of underdevelopment and poverty, the solutions are tilted towards addressing the effects of underdevelopment such as high unemployment, hunger, low literacy rate, prevalence of communicable diseases, and other low quality of life parameters. There are fewer empirical investigations into the causes of underdevelopment and poverty across developing countries. For instance, there is a need to intricately decipher the role that traditions, cultural values, norms, beliefs, and religious inclinations play in development. This is because non-economic factors could be either great contributors to or deterrents of development. Within the Weberian framework of economic development, religious affiliations to  Protestantism  and Protestant ethics were observed to be stimulants of the entrepreneurial spirit. In turn, the entrepreneurial spirit significantly contributed to industrial development. Notably, most r