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This paper investigates the long-term implications of climate change on global migration and inequality. Accounting for the effects of changing temperatures, sea levels, and the frequency and intensity of natural disasters, we model the impact of climate change on productivity and utility in a dynamic general equilibrium framework. By endogenizing people’s migration decisions across millions of $5 \times 5$ km spatial cells, our approach sheds light on the magnitude and dyadic, education-specific structure of human migration induced by global warming. We find that climate change strongly intensifies global inequality and poverty, reinforces urbanization, and boosts migration from low- to high-latitude areas. Median projections suggest that climate change will induce a voluntary and a forced permanent relocation of 62 million working-age individuals over the course of the 21st century. Overall, under current international migration laws and policies, only a small fraction of people suffering from the negative effects of climate change manages to move beyond their homelands. We conclude that it is unlikely that climate shocks will induce massive international flows of migrants, except under combined extremely pessimistic climate scenarios and highly permissive migration policies. In contrast, poverty resulting from climate change is a real threat to all of us.

International audience; The voluntary reallocation of a portion of Special Drawing Rights (SDRs) from advanced countries to developing countries is potentially an important transformation in the international monetary system. Attention has so far been focused on the channels of this reallocation, because of the need to preserve the reserve asset nature of SDRs. The IMF is considering three options (Pazarbasioglu and Ramakrishnan, 2021). First, it is proposed to increase the size of the Poverty Reduction and Growth Trust (PRGT). Second, the IMF could create a new IMF-administered Resilience and Sustainability Trust, or RST: The proposed RST would support policy reforms to help build economic resilience and sustainability in low-income countries and small states, as well as vulnerable middle-income countries. Third, the IMF could channel SDRs to other prescribed SDR holders, comprising 15 organizations including the World Bank, some regional central banks, and multilateral development banks. The three options are non-mutually exclusive.

As commonly agreed, the vulnerability of a country is here considered as the risk it will be hurt by exogenous shocks. The vulnerability of countries has been recognised since the beginning of development economics as one of the main problems they face, due to shocks, either of external or natural origin. For decades, there has been a rich literature on the economic, social and political consequences of unstable export earnings. More recently, there has been a growing concern about other kinds of vulnerability, linked to shocks such as outbreaks of violence and other expressions of political fragility, epidemics, natural disasters and, above all, climate change: the vulnerability that climate change brings to developing countries in varying degrees constitutes a global challenge., Selon l’acception courante, retenue ici, la vulnérabilité d’un pays est le risque pour lui d’être affecté par des chocs exogènes. La vulnérabilité des pays est reconnue depuis le début de l’économie du développement comme un des principaux problèmes auxquels ils ont à faire face, en raison de chocs, d’origine soit externe soit naturelle. Pendant des décennies, une abondante littérature a pu ainsi traiter des conséquences économiques, sociales et politiques de l’instabilité des recettes d’exportations. Plus récemment, une préoccupation croissante est apparue à propos d’autres sortes de vulnérabilité, liées à des chocs tels que les flambées de violence et d’autres expressions de la fragilité politique, les épidémies, les désastres naturels et surtout le changement climatique : la vulnérabilité que celui-ci entraîne à des degrés divers dans les pays en développement constitue un défi à l’échelle mondiale.

The MVI project was born from a UN General Assembly Resolution that gives it legitimacy, conditioned by its economic rationale (see the previous notes prepared for UNDESA-OHRLLS for their support to the work of the High-Level Panel on MVI: Guillaumont, Feindounou, Wagner, 2022; and Guillaumont, 2022).

Expansion of Global Value Chains (GVCs) is a mixed blessing for the environment. Effects of growth and emissions from transport associated with international trade have negative effects; but greater flows of knowledge and associated spillovers, and adoption of environmentally innovative products have positive effects. This paper provides evidence on carbon dioxide (CO2) emissions for 51 African and 132 other countries for 163 products over the period 1995‒2015. The resulting landscape is summarized in four patterns. Patterns identified for the Africa region differ from those identified for other regions but are closely related to a synthetic aggregate comparator constructed on the basis of three characteristics (per capita income, share of manufacturing in GDP, and distance to trading partners). 1: All regions have reduced emission intensities over the period 1995‒2015. Africa's share of global CO2 emissions has remained constant over the period 1995‒2015. Asia, already the region with the largest share of global emission in 1995, has strengthened its leading polluter position. Europe and the Americas have reduced their share of emissions by nine and eight percentage points, respectively. Asia is decarbonizing; Africa not yet. 2: Carbon intensity of production has increased in Africa in both decades, though much less so over the period 2005‒2015 when, on average, emissions grew less rapidly than population. Over half of the 20 African top emitting countries shifted towards more carbon-intensive techniques. 3: Source of regional total emissions: Over the period 1995‒2015, intra-regional shares of emissions fell by seven, ten, and two percentage points to 84%, 75%, and 88% for Africa, Europe, and Asia, respectively. Africa's share of emissions originating from Asia rose from 4% to 11%. Europe's share of emissions originating from Africa and Asia rose from 2% and 8% to 4% and 16%, respectively 4: The export basket of Africa is skewed towards high CO2e intensity products. CO2 emission intensities are positively correlated with both the output upstreamness (OU) and input downstreamness (ID). The OU/ID indicator of position in a supply chain is negatively correlated with CO2 emission intensities within regions. The fit is higher at the sectoral level. For manufactures, being more upstream by 1% is associated with a higher emissions intensity of 0.61%. For the other sectors, the relation is negative, and largest for Agriculture and Construction.

Impact, sens. Le merveilleux film de Sofia Coppola, « Lost in Translation », de 2003, disserte avec génie sur la rencontre, le mal-être, le langage, l'isolement… Avec une infinie modestie, l'objet de cet article est, à son image, de rendre compte de la rencontre si difficile et il faut l'espérer moins désespérée, entre l'économie générale de notre temps et la communauté de l'investissement d'impact. Sa principale thèse est un plaidoyer pour l'armement, scientifique de cette dernière. Il semble en effet que l'ensemble de l'économie mondiale se soit rendue à une vaste entreprise de conviction que produire et vendre ne serait plus, comme Adam Smith aimait le rappeler, seulement une affaire de profit et d'intérêt de la part de notre boucher , mais avant tout une question de contribution.

The paper reports on evidence on how trade can help Africa adapt to Climate Change (CC) along three dimensions: (i) fast-onset events from short-lived extreme occurrences (floods, extreme temperatures); (ii) slow-onset events (rise in average temperatures and sea-level rise); (iii) trade facilitation policies. • Fast onset events. Trade reduces the amplitude of extreme events like a drought. But policy reactions to large shocks can increase the amplitude of the shock. During the South African drought of 2015-6, policies had spillovers in neighboring countries. Following the 2008-09 financial crisis, export restrictions by major crop exporters and reduction in tariffs by importers amplified the shock. Policy coordination is needed to control spillover effects. • Slow-onset events. Modelling efforts have concentrated on exploring the ‘margins’ of adjustment to CC: changes in production levels of existing crops; switches in crops; changes in land utilization; labor relocating to urban areas/migration; adjustments in the volume of trade at different scales (regional or international). All reviewed models show that enlarging the channels of adjustment mitigate the amplitude of the loss in welfare from expected CC over the 21st Century. Decomposing the welfare changes suggests two conclusions. First adjustments in crop selection and in bilateral trade partners contribute approximately equally to reducing the costs of adjustments. Second, the expected sharp increase in food prices resulting from warming is likely to hit SSA most strongly. • Trade facilitation. A functioning global trading system is a public good to become more valuable under CC. Free and unfettered access to global food (and other key) supplies must be ensured, especially for Africa. This requires a rapprochement between the trade and climate regimes. As an entry point, besides dealing with harmful subsidies (fossil fuels, fisheries), developed countries could conclude a plurilateral Environmental Goods Agreement (EGA) that would be a triple win for trade, for the environment, and for African agriculture that needs tariff-free access to climate-Adaptation related EGs (AEGs). The paper documents the magnitude of tariffs on Environmental Goods. The paper concludes that African countries could improve the functioning of the continental policy architecture by several measures. First by excluding AEGs from exclusion lists on the AfCFTA while simultaneously reducing their barriers to trade on AEGs and EPPs. Second, preserving the environment should be mainstreamed in the African trade architecture by including environmental provisions.

In the general presentation of the criteria that the MVI should meet, we emphasized the importance of the way by which the three dimensions of the MVI are averaged in a single index and the need to limit the substitutability between them, so that the specific vulnerability of each country can be fairly reflected. [...]

The Physical Vulnerability to Climate Change Index (Feindouno et al., 2020) is a composite indicator computed at country level (191 countries) that can be used for the identification of the most vulnerable countries and as a criterion for guiding the international allocation of resources for adaptation. In this paper we present the details of the computation of the PVCCI at the sub-national level (2nd sub-national administrative level in the GADM database), representing 47,138 administrative units in the World (covering all land but Antarctica). It aims at measuring vulnerability to climate change at a finer geographic level, which is particularly relevant for countries that are characterized by high geoclimatic diversity. It would help identify the most vulnerable subnational administrative units and could be used as an instrument of adaptation planning.

Strong participation in Global Supply Chains (GSCs) (aka Global Value Chains (GVCs)) is an indication of the structural transformation at the heart of the ‘Africa we want’ described in African Union’s Agenda 2063 project. We discuss challenges at measuring GSCs and report new input- output based measures (upstreamness and downstreamness of exports) at several levels: across countries, regions, and sectors over the period 1995-2015. We also report participation measures based on firm-level data and new estimates of factors affecting participation of sectors in GVCs over the period 1995-2015. On average, for both Africa and MENA, exports have a low content of imported intermediates and exports undergo further transformation in destination countries before reaching consumers. Compared with other regions, both Africa and MENA mostly engage in supply chain trade with countries outside their respective region. Firm-level estimates for several countries show that African firms are scarcely engaged in supply chain trade. In sum, in spite of regional trade agreements focussing on reducing trade barriers to intra-regional trade, regional value chains have failed to develop in both regions. [...]

The literature on Optimal Currency Areas (OCA) has identified several channels for the ex post justification of the synchronicity criterion of common monetary areas. These include trade, cross-border investments, mobility of factors, mobility of goods and services, and fiscal convergence of member countries. We focus on the later for the African continent. We analyze the role of African regional economic communities (RECs) in the convergence of fiscal policies from 1990 to 2015. Our estimates show that African RECs significantly reduce fiscal divergence between countries. Furthermore, we find that common monetary areas are more effective in fostering fiscal convergence. This result is in line with the argument of self-validation of monetary arrangements in Africa, despite low levels of cycle synchronization and trade intensity.

Africa is well endowed with organizations to promote regional cooperation and integration. It has 8 African Union (AU)-recognized regional economic communities (RECs), 7 other economic organizations and 25 specialized regional organizations (ROs). On average each country is member of 3 RECs and 4 other ROs. The number of continental treaties signed by African Union member states has accelerated over the last four decades. At the same time, progress on ratifying and implementing these and their regional equivalents is slow, undermining their impacts. This has led to calls to rationalize memberships. At its 50th anniversary in 2013, the AU launched the 50year AU2063 programme, "The Africa we want, " with 15 flagship projects, heralding a renewed push towards continent-wide projects.

Does local internet diffusion spur manufacturing firm performance in developing countries? To answer this question, we conduct instrumental variable estimations, using repeated cross-section data on 40,154 manufacturing firms from 91 developing and transition economies, and find that a 10 percentage-point increase in the incidence of email use in locations where firms operate, raises by 36% their sales and sales per worker. This evidence turns out to be driven by the local dissemination of email technology within industries, rather than across industries. This higher performance in manufacturing is also found to be accompanied by output diversification, driven by inter-industry spillovers, and work-force contraction, driven by intra-industry ones. However, we further provide evidence of U-shaped inter-industry spillovers, i.e. negative inter-industry spillovers turning positive once the email incidence threshold reaches ∼ 50% of the local universe of firms, suggesting that network effects are at play. Last, these threshold effects seem related to the presence of outward-oriented firms, which tend to operate in places where internet is more diffused. Overall, this paper shows that local industrialisation paces may diverge between poorly and highly digitalised environments.

Ever since the creation of the WTO, attempts at bringing together the trade and climate regime have failed. This paper reviews attempts at reducing tariffs on products classified as Environmental Goods (EGs), causes of failure in past attempts, and suggests requirements for a meaningful agenda in future attempts. The start is the failure at the negotiations on the Environmental Goods Agreement (EGA) negotiations started in 2014 and abandoned in 2016. Discussion on prospects is around elements that would enter 'EGA-STyle' (EGAST) negotiations among a small group of countries. The paper starts with new descriptive data on the inclusion of provisions in Regional Trade Agreements (RTAs) across the world encouraging trade in EGs. However, the presence of these provisions in RTAs has not been reflected in increased bilateral trade in EGs among RTA members, confirming the relevance of continuing to revive momentum to reduce barriers to trade in EGs. Discussion of reasons for failure at the EGA (and earlier at the Doha Round) follow. An EGAST agenda should go beyond the elimination of ‘nuisance tariffs’ to include high energy-efficiency EGs and high-tariff products. The EG list should also include Environmentally Preferable Products. As to the difficult-to-detect Non-tariff Barriers (e.g. non-tariff measures), among which some are protectionist in intent, they should be included in the agenda up for mutual recognition. The paper concludes that EGAST negotiations to reduce barriers to trade in EGs would still be a promising avenue for rapprochement between the trade and climate regimes.

As happened in West Africa in 2008, in an imported inflation context, it is common for the governments to take short-term tax action to protect the poor: VAT or trade tariffs exemptions. As part of the tax-tariff transition, the comparison between Trade tariffs and VAT has already been the subject of much works. The introduction of VAT, as a tax on final consumption, is supposed to be optimal, due to its economically neutral aspect for production decisions. However, some authors show that in developing countries, a large informal sector affects this result. In this paper, we use a CGE model and a micro-simulation model to compare the effects of VAT and Trade tariffs exemptions to combat rising agricultural food prices.

International audience; The private sector plays a crucial role in promoting the sustainable development. It is generally accepted that firms creates wealth, generates jobs and thus contributes to improving the living conditions of populations; while being able to increasingly ensure the preservation of natural resources, biodiversity and the climate and promoting the emancipation of women.

All members of the WTO participate in the Trade Facilitation Agreement (TFA) that is to reduce border and documentary compliance in customs. Successful implementation should benefit all countries, the developing countries and more particularly the three categories of vulnerable countries receiving special status at the UN: Least Developed Countries (LDCs), the Landlocked Developing Countries (LLDCs) and the Small Island Developing States (SIDS). This paper gives plausible estimates (in the sense of realizable at the country and group levels) of reduction in trade costs from a successful implementing of the TFA. The paper starts with a presentation of the TFA noting its two principal characteristics. First, the TFA is a rules-based bottom-up approach built into the agreement that takes into account countries’ implementation capabilities, an important feature for the three groups of UN vulnerable countries. Second, the TFA provisions are monitorable (e.g. provisions like the publication of information, advance rulings, appeal or review of decisions, transparency, and border agency cooperation). In preparation for the agreement, the OECD has assembled large amount of indicators of the state of implementation of provisions in the TFA summarized in a TFI (Trade Facilitation Index). TFI values for 2019 are then used to evaluate econometrically the impact of implementing TFA on the waiting-time reduction at customs for a sample of 160 countries. Average ad-valorem equivalents (AVEs) of reduction of time in customs estimates for each UN-grouping (LDCs, LLDCs, and SIDS) show averages in the range 2.1%-2.9% for imports and 1.9%-2-7% for exports. Larger gains are obtained for a more ambitious implementation of the TFA. Importantly, gains are larger for each of the three groupings than for other developing countries, a corroboration that the UN vulnerable categories capture an aspect of vulnerability.

International audience

If it becomes possible to mobilize significant external financing for Africa, it is necessary to consider how these flows will be distributed among the various African countries. The issues facing the Summit are both Africa’s financing needs compared to those of regions and the respective needs of the various African countries. Not all of these countries have the same needs or the same absorptive capacity., S’il devient possible de mobiliser des financements extérieurs importants à destination des pays africains, il faut simultanément s’interroger sur la façon dont ces flux seront répartis entre les différents pays. Les questions auxquelles le Sommet doit faire face sont à la fois celle des besoins de financement relatifs de l’Afrique et celle des besoins respectifs des différents pays africains. En effet, ces pays n’ont pas tous les mêmes besoins, ni la même capacité d’absorption

Very soon after the first cases of Covid appeared on the African continent, governments adopted a series of measures to limit its spread. To be effective, these measures require that they be widely accepted and respected by the population, notwithstanding their various costs to the individual. Compliance depends on numerous individual and collective cultural, socio-economic, institutional and environmental factors, as well as on the perception of the risks involved and the severity of the protean consequences that the pandemic may generate.We examine these various issues based on data from a survey conducted in Burkina Faso in May-June 2020. The results show that the measures adopted by the authorities to limit the spread of the pandemic are generally fairly well respected. The vast majority of respondents take the epidemic very seriously and consider that the health consequences, and even more so the economic consequences, will be serious. The survey also shows that a large proportion of respondents are concerned about the consequences of the epidemic on the deepening of inequalities and the increase in violence and insecurity. The results highlight both common features and great heterogeneity in perception and behavioral response at the individual and regional levels, thus providing useful information for Burkina Faso's decision-makers to better calibrate the prevention strategies to be implemented as the pandemic accelerates in Burkina as in other African countries and the prospect of broad immunization coverage remains both distant and highly uncertain, Très rapidement après l’apparition des premiers cas de Covid sur le continent africain, les gouvernements ont adopté une série de mesures visant à en limiter la propagation. Pour être efficaces, ces mesures exigent qu’elles soient très largement acceptées et respectées par la population nonobstant les coûts de diverses natures qui en résultent pour chacun. Or l’observance des dispositions dépend de nombreux facteurs individuels et collectifs d’ordre culturel, socio-économique, institutionnel et environnemental, ainsi que de la perception que chacun a des risques encourus et de la gravité des conséquences protéiformes que la pandémie peut engendrer.Nous examinons ces différentes questions à partir des données d’une enquête effectuée au Burkina Faso en mai – juin 2020. Il en ressort que les mesures préconisées par les autorités pour limiter la propagation de la pandémie sont globalement assez bien respectées. La grande majorité des répondants prend l’épidémie très au sérieux et considère que les conséquences sanitaires et, plus encore les conséquences économiques, en seront graves. L’enquête montre également qu’une grande partie des répondants est soucieuse des conséquences de l’épidémie sur le creusement des inégalités et sur l’accentuation de la violence et de l’insécurité. Les résultats mettent en évidence à la fois des traits communs et une grande hétérogénéité de perception et de réponse comportementale au niveau individuel et au niveau régional. Il s’en dégage par suite des éléments d’information utiles aux décideurs Burkinabés pour mieux calibrer les stratégies de prévention à mettre en œuvre alors que la pandémie s’accélère au Burkina comme dans les autres pays africains et que la perspective d’une large couverture vaccinale demeure lointaine.

Cet article présente une méthode originale d’évaluation de l’impact des projets d’aide au développement dans les zones fragiles et difficiles d’accès, sur la base d’un exemple appliqué aux pays du G5 Sahel. Sur la base de données géolocalisées et en utilisant des informations détaillées sur les projets de la Banque mondiale fournies par AIDDATA, des enquêtes périodiques (DHS, EPA) et des données sur la luminosité nocturne, cet article montre qu’il est possible de mener des évaluations d’impact à coût limité et en respectant les contraintes méthodologiques de ce type d’évaluations, notamment : (i) le problème lié à la définition d’un contrefactuel. Il est possible de localiser les individus par rapport à l’emplacement du projet, et la définition d’un rayon d’action permet d’identifier deux groupes (un groupe traité et un groupe de référence).

International audience; S’il devient possible de mobiliser des financements extérieurs importants à destination des pays africains, il faut simultanément s’interroger sur la façon dont ces flux seront répartis entre les différents pays. Les questions auxquelles le Sommet doit faire face sont à la fois celle des besoins de financement relatifs de l’Afrique et celle des besoins respectifs des différents pays africains. En effet, ces pays n’ont pas tous les mêmes besoins, ni la même capacité d’absorption.

International audience; Despite Mauritius’ history of resilience, Jaime de Melo highlights some of the country’s fragilities in terms of governance, environmental protection and human capital. In the short-run, he calls on the country to improve its governance by committing to external scrutiny and to resist protectionist winds. In the longer-run, the article highlights three imperatives: 1) a substantial boost in education to enable the country to grab opportunities brought about by the 4th industrial revolution, 2) the development of a services hub for Africa and 3) greater preservation of the environment to reverse the current rapid environmental degradation on the island.

The authors assess to what extent the Enhanced Integrated Framework (EIF) provides assistance to LDCs through its “Diagnostic Trade Integration Study (DTIS)” towards more effective trade and development policies. The DTISs raison d’étre is to improve LDC’s trade capabilities and - thence - reduce their levels of poverty. A key feature of LDCs economies are their agricultural commodities. DTIS are intended to guide LDCs in increasing the quantity, quality and value-addition of exports of agricultural commodities; creating jobs and increase welfare. Thus, better understanding how products best fit into the global supply and global value chains (GSC/GVC) becomes critical. Our analysis shows that the new guidelines for the DTISs of 2018 do not sufficiently address the Global/Regional Supply and Value Chains.

International audience; La Fondation pour les Études et Recherches sur le Développement International (Ferdi), domiciliée à Clermont-Ferrand, vient de terminer une passionnante étude menée pour le compte de la Fondation Prospective et Innovation sur « Les déterminants des conflits internes dans le monde : Comment estimer les risques et mieux cibler les efforts de prévention ». Par comparaison aux théories existantes sur les conflits et les analyses statistiques sur ce sujet, la Ferdi apporte dans son travail plusieurs avancées notables. On y trouve par exemple les justifications de l’existence de deux types de risques différentiés-risques structurels et risques non structurels-, la mise au point d’un indicateur qui estime les probabilités d’apparition d’un conflit interne, et la mise en évidence de l’importance de la prévention des conflits, rendue possible grâce à la meilleure connaissance des risques majeurs. Même si les conclusions de cette étude peuvent s’appliquer à l’ensemble des pays en développement, ses auteurs portent une attention particulière au Sahel, devenu dans les années 2010 une zone où le risque de conflit a particulièrement augmenté, et où sa concrétisation est parfois devenue une réalité quotidienne et durable. Dans ce périmètre sahélien, le présent article s’attachera au cas concret du Mali.

The purpose of this paper is to assess the importance of external shocks relative to internal characteristics in explaining variation of firm growth in developing countries. To do so, we compile firm-level panel data covering 12,562 firms operating in 72 low-income and middle-income countries. Our statistical analysis reveals that, on average, firm characteristics account for a half of difference in growth rate across firms. However, the importance of internal factors is halved when we exclude firms in the tails of the distribution (top performers and worst performers). On the other hand, external shocks account for less than one tenth of variance. The role of external shocks is, however, stronger for young firms and for firms operating in unstable environments. Finally, our findings suggest that the external context is more crucial for exit than for growth.

International audience; À l’époque des indépendances en Afrique subsaharienne, l’un des crédos les mieux partagés par les dirigeants des nouveaux États et par les bailleurs de fonds bilatéraux et internationaux (désormais appelés Partenaires techniques et financiers ou PTF) qui se penchaient sur leur destin économique était la nécessité de banques de développement étatiques pour que les objectifs de croissance et de construction de systèmes économiques nationaux modernes puissent être atteints dans les meilleurs délais.

Treaties implemented by Regional Organizations (ROs) among which the eight Regional Economic Communities (RECs) have piloted integration across the African continent. The recently created Africa Continental Free Trade Area (AfCFTA), effective since May 2019, is the latest effort along the roadmap started with the Abuja Treaty of 1994 and continued with the launch of ‘Agenda 2063’ on the 50th anniversary of the OAU. This primer has three objectives: take stock of progress at market integration and understand the causes of the African ‘proximity gap’; summarize and provide new evidence on the extent of integration, and; discuss challenges ahead.The ambitious objectives of the AfCFTA among highly diverse economies is suggestive of a trilemma: (i) solidarity (calls for special and differential treatment); (ii) build large markets (calls for the removal of all policy-imposed barriers to trade to reap economies of scale); (iii) ‘deep’ integration (calls for covering behind-the-border measures). The example of the negotiations for the Tripartite FTA illustrates the difficulties of accommodating differences in preferences in a group of 28 countries. This ambitious agenda in a setting of limited implementation capabilities raises the specter of capability traps.Lowering regional trade costs is key for a successful AfCFTA. Model-based calculations show that these costs have fallen over the last two decades, but not faster than elsewhere so that Africa has not improved its relative position. Estimates of the intensity of bilateral trade in parts and components are positively related to measures of ‘deep integration’, an indication of the importance of tackling ‘behind-the-border’ measures affecting trade, an objective of phase II of the AfCFTA. Estimates of the correlates of bilateral trade costs give support to measures promoting ‘deep’ integration. An outcome indicator of the thickness of borders based on changes in light-intensity along all major cross-border African roads shows that over the period 2000-13, the thickness of African borders has fallen.All RECs are lagging MERCOSUR and ASEAN in supply chain trade. Over the 1990-2015 period, participation has been limited to the downstream side (i.e. value-added exports enter mostly as inputs into exports of importing countries) with partners outside the region which is in contrast with MERCOSUR and ASEAN where all value chains have developed with regional partners. In the case of ASEAN, the share of trade involving partners outside the region has stayed constant over the 25 period while the share of Regional Value Chain (RVC) trade only involving RTA partners has more than doubled from 7 percent to 17 percent. By 2015, ASEAN’s RVC share was about 6 times higher than the RVC rate for SADC, the REC with the most RVC integration. This suggests that intra-regional trade costs have fallen in MERCOSUR and ASEAN but not across the RECs. In short, African countries still have to produce a complete product in order to enter a new product line.The review singles out two areas for reducing intra-regional trade costs: adopting simple rules of origin, i.e. rules that are business friendly rather than business owned (details in annex A3) and ‘taking seriously’ the Trade Facilitation Agreement (TFA). New estimates suggest that if the average time in customs for imports at the African Union level were to be reduced to the average time for exports, that is reduced by 49 hours, this would be equivalent to a reduction of 2.7% on tariffs in importing countries.The greatest challenge ahead is increasing the provision of Regional Public Goods (RPGs). These are under-provided across the continent. Because this primer is mostly about economic integration, we only cover evidence of RPGs in two areas: peace and security and cross-border infrastructure. For both, the evidence suggests that provision of these RPGs has been low. Greater provision would be conducive, if not essential, to the success of African regional integration.

International audience; Le premier semestre de 2020 s'achève en Afrique d'une manière dra-matique. Cette situation n'est pas inédite pour autant, tellement ce continent a désormais l'habitude d'être affecté par des chocs exté-rieurs mondiaux. Elle se révèle néanmoins d'une dangerosité, elle, sans précédent. Face à elle, la raison appellerait une réflexion fondée des enchainements logiques, sinon sereins, du moins froids. N'est-ce pas cette raison qui doit conduire l'élaboration de la politique pu-blique ? Cependant, ici, l'importance des enjeux humains, sociaux et politiques de ce que nous vivons et pourrions vivre génère des sentiments , qui ne peuvent, être, eux, que chargés. Suivre la pente de ces sentiments peut pourtant nous aider à retrouver le chemin de la pensée, et à identifier les motivations d'un rebond dans une nou-velle histoire qu'il faut appeler de nos voeux.

International audience; The recent Africa Continental Free Trade Area (AFCFTA), in force since May 2019, is an important opportunity to developing and deepen supply chain trade across Africa. Evidence shows that integration into production networks-Global value Chains (GVCs) or Regional Value Chains (RVCs)-provides new opportunities for developing countries to participate in global trade and diversify their export baskets through hyperspecialisation in fragmented production processes. Without an ecosystem of supply chain trade, a country would have to be able to produce a complete product before entering a new line of business.

Utilizing a new database of over 200 employees surveyed in Senegal, we demonstrate the impact of formalization and employment contracts on credit access. Through a probit model, we show that formalization has a significantly positive impact on credit access since an employee's probability of accessing credit increases by 23% if they have a formal employment contract. The possession of an employment contract increases the likelihood of having a bank account by 18%. We find that other potential determinants studied in the existing literature, such as gender, education and salary, do not have a significant impact on access to credit. These results highlight the impact of formalization on credit access and make a strong case for the economic development that could result from a continuation of the efforts being undertaken to formalize African economies, which still remain predominantly informal.

International audience; In this policy brief, we use survey data from the WBES to provide an empirical assessment of the contribution of digital technologies diffusion to African SMEs’ performance. Compared to existing empirical evidence on the impacts of digital technologies on African firms, the quantitative analysis hereafter presented incorporates various novelties.

This paper examines how firms recover after a short, but severe, external shock. Thanks to a rich firm-level database, we follow surviving formal enterprises before, during and after the 2011 post-electoral crisis in Cˆote d'Ivoire. Main findings are summarized as follows. First, recovery was rapid in the first year but imperfect: three years after the shock, firms did not reach their previous level of productivity. Second, we show a wide heterogeneity in recovery across firms (within the same industry). Young and local firms were more able to rebound after the crisis. In addition, credit-constrained firms were less resilient, highlighting the importance of access to credit in post-crisis periods. Finally, the recovery was higher for labor-intensive firms but firms relying more on skilled workers and managers faced a lower rebound.

International audience; La politique de lutte contre le Covid 19 menée au Nord par confinement a pour effet de transférer au Sud la surmortalité imputable au virus ainsi évitée, en raison de la récession majeure que cette poli-tique entraîne et qui se transmet au Sud, où elle est source de sur-mortalité, plus qu'au Nord.

We estimate the tax burden on the mobile telecommunication sector in twenty-five African countries. This tax burden encompasses not only standard and particular taxes under the control of the Ministry of Finance (MoF), but also fees raised by national telecommunication Regulatory Agency (RA). Given the lack of financial data at the country level, we build a representative mobile network operator, named TELCO, using the GSMA Intelligence database. We compute the Average Effective Tax Rate (AETR) for this firm considering general and special taxes and fees levied only on the telecommunication sector. We develop a web application (https://data.cerdi.uca.fr/ telecom/), which allows the reader to replicate our analysis or to modify TELCO and tax parameters. The AETR varies significantly across countries, ranging from 33 percent in Ethiopia to 118 percent in Niger. Special taxes and fees represent a large share of the AETR illustrating some taxation by regulation and a potential tax competition (a race to the top) between the MoF and the RA. We compare the AETR of TELCO to this of a representative gold mining plant and a standard firm with similar gross return. The tax burden of the telecommunication sector is higher than this of the mining sector in 15 countries out of the 19 countries for which we have data on the gold mining sector.

This paper performs a sensitivity analysis of the effects of the Economic Vulnerability Index (EVI) on economic growth both theoretically and empirically. The first part uses Continuous Time Stochastic Optimal Control techniques to build a stochastic endogenous growthmodel which illustrates that an increase in Economic Vulnerability reduces the growth rate in the Economy. The second part employs the new Dynamic Common Correlated Effects Estimator for Heterogeneous Cross-Sectionally Dependent Dynamic Panels Data to empirically undertake the sensitivity analysis of the impacts of the Economic Vulnerability Index on growth. To this end, we build many Economic Vulnerability Indices by changing how its components enter its definition according to a wide range of possible scenarios.

Public financial institutions and National Development Banks (NDBs) in particular are well suited to fill financing gaps in un- or under- served markets. By virtue of their developmental mandate, and local expertise, NDBs are able to operate and invest in the most vulnerable regions where the risk is often too great for a majority of private actors. This study intends to reflect on NDBs mandates in this context by shedding light on the significant role they can play to address scarcity of financing in vulnerable areas within developing countries. Using firm-level data for 127 countries over 2006-2018, we find that on average, there is no significant difference in terms of productivity levels between firms accessing private versus public finance. NDBs tend to provide more finance in less developed localities relative to private commercial banks. Our results show therefore that public banks support more firms in less developed localities, without necessarily selecting less productive firms. Instead, they seem to be able to manage more risks related to the local context that fall outside of the direct control of the firm but that might affect their future portfolio performance. Evidence also supports the emerging consensus that public banks play a countercyclical role by strengthening their credit offer during bad times.This Research Paper is published in the framework of the International Research Initiative on Public Development Banks working groups and released for the occasion of the 14th AFD International Research Conference on Development. It is part of the pilot research program “Realizing the Potential of Public Development Banks for Achieving Sustainable Development Goals”. This program was launched, along with the International Research Initiative on Public Development Banks (PDBs), by the Institute of New Structural Economics (INSE) at Peking University, and sponsored by the Agence française de développement (AFD), Ford Foundation and International Development Finance Club (IDFC).

Using a unique database of 204 employees in Senegal, this paper seeks to understand the determinants leading to the choice to enroll (or not) in a health insurance plan. To answer this question, we created three surveys to test certain preferences (time preference and risk aversion) and the role of information. In this paper, we show that Senegalese employees have a very strong preference for the present and a low aversion to loss, which could cause them to not take out insurance. We find that access to information on health insurance plays an essential role in the willingness to enroll. While 12% of employees who received no information about health insurance said they would not want to be insured if they could choose, this proportion dropped to 2% among employees who received positive information about health insurance. These results are econometrically confirmed when controlling for other factors such as gender, age and education. These results show the importance of information on people's perception of health insurance. It is therefore essential to communicate on the functioning of health insurance and the benefits of being covered in order to strengthen adherence to a health insurance system.

Ferdi, Document de travail P257, December2019; The mining sector accounts for a significant share of tax revenues in many sub-Saharan African countries. Mining tax systems must then both attract investors and ensure sufficient revenues for governments. Following the increase in commodity prices in the second half of the 2000s, most African countries reformed their Mining Acts to increase the tax burden on mining companies. This study shows that this trend is still continuing in 2018. Mining royalty rates are rising, mineral resource rent taxes are reappearing and free equity for the States is increasing.

In the mining sector, governments must be able to reconcile two objectives: to attract foreign direct investment to exploit the resource and to capture a sufficient share of the mining rent to finance development. This problem has been known for a long time, and it certainly raises the question of the sharing of the mining rent between the actors; however, it should also highlight the importance of the progressiveness of tax regimes. Progressive taxation is one of, if not the main, the criteria that could provide lasting reassurance for investors and guarantee that the State can capture a "fair" share of the rent generated by the sector. Though several studies differentiate between tax instruments according to their economic effects, none seek to assess the ability of African mining regimes to adapt the tax burden paid by the investor to the profitability of projects. The tax database made available by the Foundation for International Development Studies and Research (FERDI), in partnership with the Centre for International Development Studies and Research (CERDI) and the International Centre for Taxation and Development, lists the 12 main taxes and duties that have applied under the legislation since 1980 to industrial companies in the gold sector in 21 African countries. When applied to the economic data of representative African mines, this database allows researchers and analysts to build indicators to identify the tax regimes most likely to reconcile the actors in the sector, while taking into account their complexity. The results of our analysis show 1) that the share of mining rent received by governments is very heterogeneous between countries, and 2) that "innovations" in terms of tax design have only mitigated, in the best of cases, the regressiveness of tax systems.; Dans le secteur minier, les États doivent être en mesure de concilier deux objectifs : attirer les investissements directs étrangers pour exploiter la ressource et capter une part suffisante de la rente minière pour financer le développement. Cette problématique est connue depuis longtemps et pose certes la question de la répartition de la rente minière entre les acteurs, mais devrait aussi mettre en évidence l’importance de la progressivité des régimes fiscaux. Une fiscalité progressive est un, sinon le critère principal qui pourrait rassurer de façon durable les investisseurs et garantir à l’État de capter une part « juste » de la rente générée par le secteur. Alors que plusieurs études différencient les instruments fiscaux selon leurs effets économiques, aucune ne cherche à évaluer la capacité des régimes miniers africains à adapter la charge fiscale supportée par l’investisseur à la rentabilité des projets. La base de données fiscales mise à disposition par la Ferdi , en partenariat avec le Cerdi et l’ICTD, recense les 12 principaux impôts, droits et taxes qui s’appliquent selon la législation aux entreprises industrielles dans le secteur de l’or de 1980 à nos jours dans 21 pays africains. Appliquée aux données économiques de mines représentatives africaines, cette base de données donne les moyens aux chercheurs et analystes de construire des indicateurs permettant d’identifier les régimes fiscaux les plus à même de réconcilier les acteurs du secteur, tout en tenant compte de leur complexité. Les résultats de notre analyse montrent 1) que la part de la rente minière perçue par les États est très hétérogène entre les pays, et 2) que les « innovations » en termes de conception de l’impôt n’ont fait qu’atténuer, dans le meilleur des cas, la régressivité des régimes fiscaux.

Does international trade help or hinder the economic development of border regions relative to interior regions? Theory tends to suggest that trade helps, but it can also predict the reverse. The question is policy relevant as regions near land borders are generally poorer, and sometimes more prone to civil conflict, than interior regions. We therefore estimate how changes in bilateral trade volumes affect economic activity along roads running inland from international borders, using satellite night-light measurements for 2,186 border-crossing roads in 138 countries. We observe a significant 'border shadow': on average, lights are 37 percent dimmer at the border than 200 kilometers inland. We find this difference to be reduced by trade expansion as measured by exports and instrumented with tariffs on the opposite side of the border. At the mean, a doubling of exports to a particular neighbor country reduces the gradient of light from the border by some 23 percent. This qualitative finding applies to developed and developing countries, and to rural and urban border regions. Proximity to cities on either side of the border amplifies the effects of trade. We provide evidence that local export-oriented production is a significant mechanism behind the observed effects.

Ce document synthétise les messages portés par les travaux de la Ferdi traitant des enjeux du Sahel et de ses fragilités. Le diagnostic qu'ils dressent met notamment en lumière les fortes vulnérabilités auxquelles les pays sahéliens font face. Si sous-développement et insécurité se nourrissent mutuellement, les raisons de refuser le pessimisme ambiant sont malgré tout réelles. La communauté internationale doit pour cela mener au Sahel une politique de développement ambitieuse en cohérence avec le soutien militaire qu'elle apporte aux pays sahéliens. Elle doit également promouvoir une approche pluridisciplinaire favorisant la coordination de tous les acteurs et adapter ses méthodes au contexte si particulier de la sous-région. Elle est invitée en outre à réinvestir des secteurs clés du développement mais délaissés depuis trop longtemps tels que l'éducation primaire et l'agriculture. Elle doit enfin ne pas négliger la dimension institutionnelle et politique du développement, notamment en portant une attention particulière à la (re)construction institutionnelle des États fragilisés.

This paper investigates the impact of domestic fuel price increases on export growth in a sample of 77 developing countries over the period 2000-2014. Using a fixed-effect estimator and the local projection approach, we find that an increase in domestic gasoline or diesel price adversely affects real non-fuel export growth, but only in the short run as the impact phases out within two years after the shock. The results also suggest that the negative effect of fuel price increase on exports is mainly noticeable in countries with a high-energy dependency ratio and countries where access to an alternative source of energy, such as electricity, is constrained, thus preventing producers from altering energy consumption mix in response to fuel price changes.

Le choix d’un régime de change par un pays en développement est toujours une décision difficile. Le taux de change réel qui exprime le prix relatif des biens locaux par rapport aux prix des biens étrangers, et plus généralement le prix des biens faisant l’objet du commerce international par rapport aux biens n’en faisant pas l’objet ou biens domestiques, influence l’ensemble de la structure des prix et ce faisant exerce des impacts multiples, financiers, économiques et sociaux. Quant au choix de son régime des changes le Maroc semble à la croisée des chemins.

This paper investigates the validity of Gibrat's law in sub-Saharan Africa using data from 22,495 firms operating in 45 African countries. Results indicate that Gibrat's law does not hold in Africa, i.e. small firms create more jobs than their larger counterparts do. We point out that the usual explanations (such as diminishing returns, the learning process, and the minimum efficient size) do not explain this finding. We present a new explanation based on firm access to capital. According to our hypothesis, employment growth among small firms in Africa is faster because small firms adopt labor-intensive and capital-saving technology to expand their business activities. SMEs have a lower capital-labor factor because in order to grow, they tend to overuse labor and underuse capital due to financial constraints., hence their greater job growth momentum. Different econometric tests provide support to our hypothesis. Specifically, we prove that the negative relationship between firm size and growth is mitigated for firms with access to credit.

Trends and differentials in the nutritional status of children are analyzed using data from DHS surveys conducted in French-speaking Sahelian countries (Senegal, Mali, Burkina-Faso, Niger, Chad and Mauritania). The study covers as much as possible the 1990-2015 period, with variations across countries depending on data availability. Data from Mauritania do not allow for trend analysis, but only for differential analysis. Trends are analyzed using linear regression models by cohort (year of birth), taking into account gender and age. Differential analysis focuses on place of residence, household wealth, and adult level of education. In the five countries with available data, the height of children aged 12-59 months increased steadily over the period, indicating a marked improvement in nutritional status. This increase in height was particularly notable in Senegal and Burkina Faso. The change in weight was also positive, but more contrasted and particularly weak in Senegal and Chad. Thus, the weight / height ratio (Body-Mass-Index or BMI) evolved differently in the five countries: it decreased in Senegal and Chad, remained virtually constant in Burkina and Niger, and increased only significantly in Mali. Differences between countries were due in part to differences in baseline levels (in 1990), and in part to differences in economic development and in public health. The prevalence of malnutrition declined sharply in all five countries due to average improvements and to decreasing inequality as measured by the reduction in standard deviations.The order of magnitude of the differentials was remarkably consistent between countries. The sex differences in weight, height and weight-for-height were almost identical, with boys being taller and heavier. The effect of urban residence on height was more marked in Mali; that on weight was more marked in Burkina and Niger; in contrast, that on BMI was negative in Mali and Chad. The effects of household wealth and level of education were always positive on weight and height, but not on BMI in Senegal. In Mauritania, differentials were broadly consistent with those of other countries, but more difficult to interpret because of small sample size. The highest socio-economic groups were close to international standards in weight and height for age. Overall, progress in public health, and in particular the control of infectious diseases, appears to have had a significant effect on children’s height, but economic growth has been insufficient to allow for an improvement in BMI., Les tendances et les différentiels de l’état nutritionnel des enfants sont analysés à partir des données des enquêtes EDS conduites dans les pays francophones du Sahel (Sénégal, Mali, Burkina, Niger, Tchad et Mauritanie). L’étude couvre autant que possible la période de 1990 à 2015, avec, cependant, des variations selon les pays en fonction de la disponibilité des données. Les données de la Mauritanie ne permettent pas d’analyse de tendance, mais seulement celle des différentiels. Les tendances sont analysées au moyen de modèles de régression linéaire selon la cohorte (année de naissance), en tenant compte du sexe et de l’âge. L’analyse différentielle porte sur lieu de résidence, la richesse des ménages, et le niveau d’instruction des adultes. Dans les cinq pays pour lesquels on dispose de suffisamment de données, la taille des enfants de 12-59 mois augmente régulièrement au cours de la période considérée, indiquant une nette amélioration de l’état nutritionnel. Cette augmentation de la taille est particulièrement notable au Sénégal et au Burkina. L’évolution du poids est elle aussi positive, mais plus contrastée et particulièrement faible au Sénégal et au Tchad. Le rapport poids/taille (indice de masse corporelle ou IMC) évolue donc différemment dans les cinq pays : il diminue au Sénégal et au Tchad, est pratiquement constant au Burkina et au Niger, et n’augmente significativement qu’au Mali. Les différences entre les pays sont en partie dues aux différences dans les niveaux de départ (en 1990), et en partie due aux différences dans les évolutions de l’économie et de la santé publique entre les pays. La prévalence des différents types de malnutrition a fortement diminué dans les cinq pays, du fait de l’amélioration moyenne et du fait de la baisse des inégalités, mesurée par la réduction des écarts-type des distributions. L’ordre de grandeur des différentiels est remarquablement consistant entre les pays. Les différences par sexe en poids, taille et poids-par-taille, sont quasiment identiques, les garçons étant plus grands et plus lourds. L’effet de la résidence urbaine sur la taille est plus marqué au Mali ; celui sur le poids est plus marqué au Burkina et au Niger ; par contre, celui sur le rapport poids/taille est négatif au Mali et au Tchad. Les effets de la richesse des ménages et du niveau d’instruction sont toujours positifs sur le poids et la taille, mais pas sur l’IMC au Sénégal. En Mauritanie, les différentiels sont grosso modo consistants avec ceux des autres pays, mais plus difficiles à interpréter du fait de la faiblesse de l’échantillon. Les catégories les plus favorisées sont proches des standards internationaux, sans être toutefois identiques. Dans l’ensemble il apparaît que les progrès de la santé publique, et en particulier le contrôle des maladies infectieuses semblent avoir eu un effet notable sur la taille des enfants, mais que la croissance économique a été insuffisante pour permettre une amélioration du rapport poids/taille, tout en permettant cependant de le maintenir en moyenne au cours des 25 ans.

L'évolution erratique de la monnaie Bitcoin a récemment jeté un coup de projecteur sur la technologie blockchain dont la célèbre cryptomonnaie est l'application la plus connue. Présentée comme une révolution disruptive par ses promoteurs, cette technologie permet la création de registres numériques infalsifiables, immuables et historicisés, et promets de pallier le déficit de confiance qui freine trop souvent les transactions. Cette note présente brièvement le concept de blockchain et en discute les implications en matière de coopération au développement. Sur le papier, l'intérêt de mettre en place un tel registre numérique est effectivement important. Pour le développement, une blockchain a principalement quatre applications possibles. Elle peut être utilisée comme outil de transfert de valeurs pour réduire le coût, accélérer la rapidité et améliorer la traçabilité des transactions. Elle peut également être utilisée comme outil de suivi de projets, d'identification d'individus ou d'enregistrement de droits de propriétés ou de sociétés. Cette technologie pourrait ainsi contribuer à faciliter ces services et réduire fortement le coût de leur délivrance. Elle permet en outre la mise en place de contrats à exécution automatisée, notamment dans le secteur de l'assurance. Elle offre enfin des perspectives de désintermédiation financière en promettant de relier directement investisseurs et emprunteurs. Le potentiel de gains d'efficacité et de transparence explique l'intérêt croissant pour la blockchain. Cependant, de nombreuses limites freinent encore son déploiement à grande échelle : elle nécessite des besoins importants en infrastructures télécom et un réseau électrique fiable, elle engendre aujourd'hui une consommation d'énergie très élevée, et sa gouvernance et sa régulation par les autorités publiques posent question. Considérée aujourd'hui comme immature, elle semble prometteuse sous conditions.

FERDI Working paper P239, October; This paper proposes a model of aid allocation which aims to equalize the opportunity between recipient countries to reduce the poverty. The model takes into account the natural growth deviation which is defined by the gap between the growth rate required to reach a development goal and the growth rate observed in the recipient countries. The resulting optimal aid allocation is computed using the estimation of a growth equation. Said equation includes effects of aid and structural handicaps to growth in recipient countries (which are represented by the economic vulnerability index and lack of human capital). To illustrate the interest of our approach, we perform a simulation which shows a substantial difference between the aid allocation obtained with our multi-criteria principle and the observed allocation. Moreover, we also shed light on the impact of the donors' sensitivity with respect to the natural growth deviation on the optimal aid allocation.

Since the creation of the Forum on China-Africa Cooperation (FOCAC) in 2000, Chinese official development assistance (ODA) to Africa has increased drastically. Only few analyses on the determinants of Chinese ODA allocation to African countries are available. Moreover, existing literature mainly focused on total aid flows while Chinese motivations for aid allocation might differ depending on the ODA sector considered. Our objective is to study the factors associated with Chinese aid allocation to African countries by sector between 2000 and 2014. We consider 3 ODA broad sectors as defined by the Organisation for Economic Cooperation and Development (OECD): the social infrastructure and services sector, the economic infrastructure and services sector and the production sector. Chinese ODA is measured using the AidData's Global Chinese Official Finance Dataset, 2000-2014, Version 1.0, released in fall 2017. Over the 2000-2014 period, China allocated 971, 218 and 138 ODA projects to African countries in the social infrastructure and services sector, the economic infrastructure and services sector and the production sector respectively. Between 2000 and 2014, the economic infrastructure and services sector was the first sector in terms of ODA amount with a total of US$18.9 billion ahead from the social infrastructure and services sector with US$7 billion or the production sector with US$3.1 billion. Results of our analysis suggest that the motivations of Chinese aid allocation to African countries differ by sector. Chinese ODA in the social infrastructure and services sector appears responsive to the economic needs of recipient countries but is also driven by foreign policy considerations. Chinese economic interest, in particular for natural resources acquisition, is associated with China's ODA allocation in the economic infrastructure and services sector. Finally, while institutions in recipient countries are not related to Chinese ODA in the social infrastructure and services sector, we find that China allocates more ODA in the economic infrastructure and services sector and the production sector to African countries with weaker institutions. One of the strong conclusions of this study is to show that considering only China's overall aid to Africa can be misleading as to its underlying determinants, and therefore to point out the need to disaggregate the analysis by ODA sectors.

Introduction: A short story of the LDCs graduation[1]The Least Developed Country (LDC) category was from the start meant to include low income countries facing structural handicaps to economic growth (in the 2011 CDP report economic growth has been replaced with "sustainable development"). Under various names, the structural handicaps considered for the identifi cation of the LDCs have been defi cient human resources and weak economic structure. Let us recall that the LDCs are identifi ed by three complementary criteria for inclusion into the category (CDP and UNDESA 2008; CDP 2015): these criteria are presently the income level as measured by Gross National Income per capita (GNIpc), and two indicators of structural handicaps, the Human Asset Index (HAI) and the Economic Vulnerability Index (EVI). Poor countries simultaneously facing these two kinds of handicaps have been described as "caught in a trap", and in need of special international attention and support measures (Guillaumont 2009a). In the long term, with the help of these measures, it should have been hoped that the countries identifi ed as LDCs will progressively overcome their structural handicaps and exit from the category, leading the LDC category to shrink. [1]also chapter 7 in Out of the Trap (forthcoming), Guillamont, P. (ed.), EconomicaThis section and the following relies heavily on a previous paper of the authors (Drabo and Guillaumont 2016)