This paper looks at the impact of members' ability to switch pension fund provider and /or portfolio on the allocation of pension funds to long-term investments.
... See More + The level of annual turnover in pension fund portfolios was compared with the amount of short-term investments (using government treasury bills and bank deposits as proxy). The investment regulations around switching and other market conduct were then considered. The paper finds that greater movements between pension fund providers and between portfolios is linked to increased holdings of short-term and more liquid assets. Switching appears to be driven by competition, market structure, and investment advice, and, unfortunately, frequently results in poor investment returns for members. The paper makes six recommends for regulators. First, use administrative controls to prevent fraudulent switching between pension providers. Second, provide clear performance and cost comparisons to inform members' choice of provider/fund and encourage informed decision making, which is beneficial for members and the system. Third, supervise and control advertising and marketing (including reporting of performance periods) carefully, to avoid switches based on misleading advice. Fourth, control financial incentives for sales agents, so that switching advice is given in members' interest and not for commercial gain. Fifth, concentrate issuance in government securities, to create more liquid instruments. And sixth, conduct further research on the concept of a central liquidity pool to manage unexpected outflows.
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Policy Research Working Paper WPS8143 JUL 11, 2017
The potential for pension funds to contribute to capital markets and thereby economic growth has been argued on a theoretical basis and demonstrated empirically.
... See More + However, reforms fostering the development of funded pension systems have not had the economic impact hoped for in some countries. Pension fund portfolios in some cases have remained highly exposed to shorter-term assets, such as bank deposits and shorter-term government bonds. This, in turn, has led to relatively low investment returns, thereby potentially affecting income adequacy in retirement. This paper looks at the potential regulatory hurdles to long-term investment by pension funds, while also proposing international diversification and the creation of domestic investment opportunities to help portfolio diversification and ultimately improve the delivery of secure, adequate pensions.
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Policy Research Working Paper WPS8136 JUL 05, 2017
The planning and analysis of infrastructure investments is complex as it is both strategic and long-term in nature, involves large capital expenditures, and affects multiple stakeholders.
... See More + The prioritization of investments in transport infrastructure investments, requires the explicit consideration of multiple and often conflicting and incommensurate perspectives and criteria. Compounding the challenges of prioritizing transport infrastructure investments is the present and future impact of climate. As a result, innovative and participatory tools are required to identify and prioritize key transport infrastructure investments that efficiently utilize available resources and engage multiple stakeholders with the goal of developing climate resilience.
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As a result of a number of internal and external shocks, Uganda’s economy is currently growing at the lowest rate recorded over the past two decades.
... See More + During the first half of FY 2016-17, the economy grew at the annualized rate of 2.6 percent, considerably lower than the long-term average rate recorded over the past two decades, which stands at around seven percent. The decline over the past five years is related partly to the increasingly volatile external environment and partly to domestic policy responses to shocks and strains related to the ongoing impact of the drought on agriculture, the civil strife in South Sudan, and the upheavals in the banking system. Therefore, current policy is focused on the management of these impacts so that they do not exacerbate macroeconomic instability and on measures to stimulate the economy to increase growth. The Government remains strongly committed to an investment push to accelerate and sustain high levels of economic growth and to facilitate socio-economic transformation. The Government’s investment push is intended to address binding constraints on growth, with the most significant of these constraints being Uganda’s huge infrastructure deficit. The first part of the Ninth Uganda Economic Update presents an assessment of the current state of the economy, while the second part addresses a specific theme related to Uganda’s development challenges and the manner in which these may be addressed. This focusses on how the management of PPPs can support Uganda’s investment push by facilitating access to private sector financing, by managing the risks intrinsic in these arrangements, and by maximizing the economic and social value of these partnerships. This can only be achieved if the Government is committed to building the appropriate set of frameworks to create a conducive environment for private investments and to adopting robust project identification, screening, procurement and contract management processes.
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Working Paper AUS21 JUN 30, 2017
rg;; 000153476:Rachel K. Sebudde:rsebudde@worldbank.oDisclosed
The development objective of the Empowering Poor Communities and Micro-Entrepreneurs in the Georgia Tourism Sector Project for Georgia is to generate employment and increase household incomes for poor and vulnerable communities in the Kakheti and Imereti regions by supporting them to: (i) start and grow micro, small, and medium-sized enterprises in the tourism sector, and (ii) implement small works for the conservation and maintenance of cultural heritage sites.
... See More + Some of the negative impacts and mitigation measures include: waste collection and disposal pathways and sites will be identified for all major waste types expected from demolition and construction activities; mineral construction and demolition wastes will be separated from general refuse, organic, liquid and chemical wastes by on-site sorting and stored in appropriate containers; construction waste will be collected and disposed properly by licensed collectors; construction noise will be limited to restricted times agreed to in the permit; During operations the engine covers of generators, air compressors and other powered mechanical equipment shall be closed, and equipment placed as far away from residential areas as possible; if the building is a designated historic structure, very close to such a structure, or located in a designated historic district, notification shall be made and approvals/permits be obtained from local authorities and all construction activities planned and carried out in line with local and national legislation; it shall be ensured that provisions are put in place so that artifacts or other possible ‘chance finds’ encountered in excavation or construction are noted and registered, responsible officials contacted, and works activities delayed or modified to account for such finds; all recognized natural habitats, wetlands and protected areas in the immediate vicinity of the activity will not be damaged or exploited, all staff will be strictly prohibited from hunting, foraging, logging or other damaging activities; Active traffic management by trained and visible staff at the site, if required for safe and convenient passage for the public; and ensuring safe and continuous access to office facilities, shops and residences during renovation activities, if the buildings stay open for the public.
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The development objective of the Empowering Poor Communities and Micro-Entrepreneurs in the Georgia Tourism Sector Project for Georgia is to generate employment and increase household incomes for poor and vulnerable communities in the Kakheti and Imereti regions by supporting them to: (i) start and grow micro, small, and medium-sized enterprises in the tourism sector, and (ii) implement small works for the conservation and maintenance of cultural heritage sites.
... See More + Some of the negative impacts and mitigation measures include: waste collection and disposal pathways and sites will be identified for all major waste types expected from demolition and construction activities; mineral construction and demolition wastes will be separated from general refuse, organic, liquid and chemical wastes by on-site sorting and stored in appropriate containers; construction waste will be collected and disposed properly by licensed collectors; construction noise will be limited to restricted times agreed to in the permit; During operations the engine covers of generators, air compressors and other powered mechanical equipment shall be closed, and equipment placed as far away from residential areas as possible; if the building is a designated historic structure, very close to such a structure, or located in a designated historic district, notification shall be made and approvals/permits be obtained from local authorities and all construction activities planned and carried out in line with local and national legislation; it shall be ensured that provisions are put in place so that artifacts or other possible ‘chance finds’ encountered in excavation or construction are noted and registered, responsible officials contacted, and works activities delayed or modified to account for such finds; all recognized natural habitats, wetlands and protected areas in the immediate vicinity of the activity will not be damaged or exploited, all staff will be strictly prohibited from hunting, foraging, logging or other damaging activities; Active traffic management by trained and visible staff at the site, if required for safe and convenient passage for the public; and ensuring safe and continuous access to office facilities, shops and residences during renovation activities, if the buildings stay open for the public.
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Argentina’s improved sovereign credit rating has helped to spur the recent sub-sovereign and corporate bond issues. In early April 2016, Standard & Poor’s upgraded Argentina’s sovereign ratings for local and foreign currency debt to B from B-.
... See More + This follows the ratings upgrade from Moody’s which raised Argentina’s sovereign rating for foreign currency denominated debt from C1 to B3 in 2016. This rating was re-affirmed by Moody’s in March 2017. Since Argentina’s re-entry into the international capital markets in early 2016, there has been USD 8.4 billion and USD 4.4 billion of bonds issued by sub-sovereign and corporate entities which is being used, in part, being used to support infrastructure projects. Although investor appetite has been relatively strong, it is difficult to ascertain the level of liquidity for sub-sovereign debt over the long-term. The potential level of involvement of foreign and local banks in the financing of infrastructure is still to be determined once Public-Private Partnerships (PPP) projects are tendered. Going forward, the issues that will impact the participation of lenders are: (i) the timing for completing and implementing the underlying regulatory framework for PPPs; (ii) the development of a project pipeline and subsequent tenders; (ii) macroeconomic conditions. The ability of the renewable energy projects under the RenovAR program to obtain bank financing will serve as useful benchmark for the rest of the PPP program. Although the enactment of the capital markets law is intended to reduce market inefficiencies, additional legislation, regulation and policies are needed to deepen and widen local capital markets. This law, which is still under legislative review, may not go far enough to develop the institutional investor base needed to provide long-term financing for infrastructure. Provisions could be added or new legislation could be developed which will: (a) encourage insurance companies to offer new types of products; (b) rebuild private pension systems by incentivizing the establishment of asset management companies; (c) providing preferential tax treatment for closed end mutual funds or value capture adjacent to real estate; (d) supporting the establishment of REITs; (e) reviewing the governance structure, mission, and investment strategy of the FGS; (f) support the development of long-term hedging instruments to manage currency risk through trusts or related mechanisms; and (g) promote the issuance of peso-linked bonds while developing a peso/dollar hedge market.
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Working Paper 117054 JUN 28, 2017
.org;; 000012349:John Daniel Pollner:jpollner@worldbankDisclosed
Ratings for the Investment Promotion and Financing Facility Project for Bangladesh were as follows: outcomes were satisfactory, risk to development outcome was moderate, Bank performance was moderately satisfactory, and Borrower performance was satisfactory.
... See More + Some lessons learned included: the learning by implementing design is a good practice that can support complex projects in difficult environments to navigate implementation challenges. The use of investment promotion and financing facility (IPFF) resources depended on the speed with which infrastructure projects under preparation reach the financing stage, availability of alternative financing sources, and the credit quality of these projects in comparison with IPFF requirements. The project considered the market conditions and accordingly restructured the project five times. A simple institutional structure is necessary to support the project’s market driven approach. Good governance and market credibility were the focus of the design of the implementation arrangements. A comprehensive technical assistance (TA) component must include a training program for the implementing agency staff as well as environment and safety (E and S) risk management capacity building from project inception to anticipate the challenges with environmental compliance in the subprojects. Early involvement from the private sector to better assess the demand for infrastructure finance is crucial.
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Implementation Completion and Results Report ICR4145 JUN 27, 2017
The objectives of the Strengthening Critical Infrastructure Against Natural Hazards Project for Tajikistan are to strengthen the recipient's disaster risk management capacities, enhance the resilience of its critical infrastructure against natural hazards, and improve its capacity to respond to disasters.
... See More + There are four components to the project, the first component being strengthening disaster risk management capacity. This component is intended to strengthen the GoT’s capacity for DRM through selected activities that focus on disaster risk identification, disaster preparedness, and financial protection against disasters. It will be implemented in coordination with UNDP, which has been continuously strengthening the capacities of the CoESCD at the national and regional levels, while building regional mechanisms for disaster risk management and mainstreaming disaster risk reduction into state policy at the national and subnational levels. The second component is the making critical infrastructure resilient against natural hazards. This component will finance capital works and contingency planning (for example, equipment for emergency situations) for the transportation network in GBAO, which suffered the most significant damage in July 2015, as well as the flood protection infrastructure that has repeatedly been damaged in the Khatlon Oblast. The third component is the contingent emergency response component. The objective of this component is to enhance Tajikistan’s capacity to respond to disasters. An emergency eligible for financing is an event that has caused, or is likely imminently to cause, a major adverse economic and/or social impact to the Borrower, associated with a disaster. Finally, the fourth component is the project management.
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The development objective of Infrastructure Finance Public and Private Partnership (IFPPP) Project for Kenya is to increase private investment in the Kenya infrastructure market across sectors and to sustain this participation over an extended period of time.
... See More + This project will consist of three components. 1) The first component, Support to Institutional Strengthening, based on an assessment of the remaining institutional strengthening activities (particularly at the county government level) following the activities undertaken under the IFPPP and the need for institutional strengthening based on future expected project activities. It has the following two subcomponents: (i) Upstream Support to Public Private Partnerships (PPP) Institutions; and (ii) Support to Capacity Building Activities. 2) The second component, Support to Project Preparation and Procurement, aims to assist the Government of Kenya (GoK), at national as well as county level, to prepare well-structured and bankable PPP projects with optimal risk allocation building on the experience in the development of the first mover PPPs under IFPPP. 3) The third component, Support for Program Management, aims to support the Project Implementation Unit (PIU) that is currently functioning under IFPPP.
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The World Bank in collaboration with RAND has developed an online calculator that allows the user to calculate and forecast the costs of the Syrian war.
... See More + This calculator combines data from the World Bank with insights from the economics literature to estimate the economic impact of destruction and reconstruction in seven key sectors — agriculture, education, energy, health, housing, transportation, and water and sanitation — in six war-torn cities. It allows users to vary key assumptions about the extent of destruction and intensity of reconstruction activity, and estimates the net economic impact on the gross domestic product (GDP) of these six cities. The online calculator supplements the 2017 World Bank's MENA Economic Monitor, The Economics of Post-Conflict Reconstruction in MENA, report, which provides estimates of the costs of the war — the human costs, the damage to infrastructure and physical capital,and the macroeconomic and sectoral costs — and outlines the principles of a reconstruction strategy.
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The World Bank in collaboration with RAND has developed an online calculator that allows the user to calculate and forecast the costs of the Syrian war.
... See More + This calculator combines data from the World Bank with insights from the economics literature to estimate the economic impact of destruction and reconstruction in seven key sectors — agriculture, education, energy, health, housing, transportation, and water and sanitation — in six war-torn cities. It allows users to vary key assumptions about the extent of destruction and intensity of reconstruction activity, and estimates the net economic impact on the gross domestic product (GDP) of these six cities. The online calculator supplements the 2017 World Bank's MENA Economic Monitor, The Economics of Post-Conflict Reconstruction in MENA, report, which provides estimates of the costs of the war — the human costs, the damage to infrastructure and physical capital,and the macroeconomic and sectoral costs — and outlines the principles of a reconstruction strategy.
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Ratings for the Palestinian Liberation Organization (For the Benefit of the Palestinian Authority) - Palestinian National Development Plan - Development Policy Grant VII for West Bank and Gaza were as follows: outcomes were moderately satisfactory, the risk to development outcome was high, the Bank performance was moderately satisfactory, and the Borrower performance was moderately unsatisfactory.
... See More + Some lessons learned included: first, the future series of development policy grants should be infused with long-term perspectives of reform, even if they continue to be standalone operations, because successful institutional reforms require continuity of effort and greater perseverance across a number of years. Second, challenging reforms in key policy areas such as civil service reforms, pensions reforms, governance and anti-corruption reforms, and improvements in the business climate need to be addressed as essential building blocks of a Palestinian state. Third, noting that a viable fiscal position is essential to macro-stability, development policy grants should be extended only when budgets are adequately financed with low risk of running arrears. In this regard, the Bank may find itself in a challenging position as it faces strong pressures to provide budget grants, thereby unlocking budget support from other donors. Fourth, the above lessons will be effective only with clear commitment from the authorities. The experience with DPG-VII and earlier operations shows that lack of commitment in critical areas has led to missed results. Fifth, the design of prior actions needs to address the critical actions that have to be taken to ensure the purpose of the reforms and secure the intended results. Sixth, a candid assessment of commitment and capacity risks should be undertaken together with proposals for mitigation. Supervision efforts should focus to a greater degree on such risks, and mitigation proposals should be a part of the dialogue.
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Implementation Completion and Results Report ICR4190 JUN 09, 2017
The objective of the Social Investment and Local Development Project for Armenia is to improve the quality and use of and access to community and intercommunity infrastructure.
... See More + Some of the negative impacts and mitigation measures include: the local construction and environment inspectorates and communities have been notified of upcoming activities; the public has been notified of the works through appropriate notification in the media and/or at publicly accessible sites (including the site of the works); waste collection and disposal pathways and sites will be identified for all major waste types expected from demolition and construction activities; mineral construction and demolition wastes will be separated from general refuse, organic, liquid and chemical wastes by on-site sorting and stored in appropriate containers; the approach to handling sanitary wastes and wastewater from building sites must be approved by the local authorities; before being discharged into receiving waters, effluents from individual wastewater systems must be treated in order to meet the minimal quality criteria set out by national guidelines on effluent quality and wastewater treatment; monitoring of new wastewater systems (before/after) will be carried out; construction vehicles and machinery will be washed only in designated areas where runoff will not pollute natural surface water bodies; and if the building is a designated historic structure, very close to such a structure, or located in a designated historic district, notification shall be made and approvals/permits be obtained from local authorities and all construction activities planned and carried out in line with local and national legislation.
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The objective of the Social Investment and Local Development Project for Armenia is to improve the quality and use of and access to community and intercommunity infrastructure.
... See More + Some of the negative impacts and mitigation measures include: the local construction and environment inspectorates and communities have been notified of upcoming activities; the public has been notified of the works through appropriate notification in the media and/or at publicly accessible sites (including the site of the works); waste collection and disposal pathways and sites will be identified for all major waste types expected from demolition and construction activities; mineral construction and demolition wastes will be separated from general refuse, organic, liquid and chemical wastes by on-site sorting and stored in appropriate containers; the approach to handling sanitary wastes and wastewater from building sites must be approved by the local authorities; before being discharged into receiving waters, effluents from individual wastewater systems must be treated in order to meet the minimal quality criteria set out by national guidelines on effluent quality and wastewater treatment; monitoring of new wastewater systems (before/after) will be carried out; construction vehicles and machinery will be washed only in designated areas where runoff will not pollute natural surface water bodies; and if the building is a designated historic structure, very close to such a structure, or located in a designated historic district, notification shall be made and approvals/permits be obtained from local authorities and all construction activities planned and carried out in line with local and national legislation.
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