Brookings: Topics - Metropolitan Areas

Confronting Suburban Poverty in America - Release Event

Mon, 20 May 2013 09:30:00 -0400

Event Information

May 20, 2013
9:30 AM - 11:30 AM EDT

Falk Auditorium
Brookings Institution
1775 Massachusetts Avenue, N.W.
Washington, DC 20036

Click here to visit the Confronting Suburban Poverty in America website.

In 1965, President Lyndon B. Johnson declared a war on poverty. Back then poverty was largely confined to inner-city neighborhoods and isolated rural areas. Today, the overwhelming majority of America’s poor live not in cities—but in the suburbs of its major metropolitan areas. Yet the paradigm of poverty in America, and the infrastructure for addressing the conditions poor families and communities face, has failed to keep pace with the reality of these changes. The problems of the growing suburban poor are now exacerbated by a weak economy and increasingly limited resources for nonprofits, philanthropies and government at all levels.

As with many challenges facing the nation, metro area leaders are leading the way in the search for solutions—learning how to do more with less and adjusting their approaches to address the metropolitan scale of poverty, collaborating across sectors and jurisdictions, using data and technology in innovative ways, and integrating services and service delivery.

In Confronting Suburban Poverty in America (Brookings, 2013), co-authors Elizabeth Kneebone and Alan Berube, take on the new reality of metropolitan poverty and opportunity in America. On May 20, they along with some of the nation’s leading anti-poverty experts, including Luis Ubiñas, president of the Ford Foundation, and Bill Shore, founder and CEO of Share our Strength, and leading local innovators from across the country discussed a new metropolitan opportunity agenda for addressing suburban poverty, how federal and state policymakers can deploy limited resources to address a growing challenge, and why building on local solutions holds great promise.

Click here to visit the Confronting Suburban Poverty in America website.

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Confronting Suburban Poverty in America - Release Event

Widening the Panama Canal and the Future of Global Trade Mapping

Adie Tomer and Joseph Kane — Fri, 17 May 2013 16:25:00 -0400

Up and down the Atlantic coast, US ports are abuzz. Dredging machines, tunnel excavators, and highway pavers from Miami to New York are preparing metropolitan economies and their ports for a newly expanded Panama Canal. As the thinking goes, an expanded Canal promises bigger ships, bigger cargo loads--and each metro wants a piece of the bigger business.

But lost in this port-related arms race is what the newly-widened Panama Canal means for the US economy . Too many metropolitan areas simply assume they’ll immediately acquire new freight business when the expanded Canal opens, or that there will be more business at all. These billion-dollar assumptions ignore a more fundamental question: how and where will the Panama Canal affect US’ global goods trade?

Answering that question requires a broader view, one less predicated on ship size and more on economy size. It also requires metropolitan areas to gain a better understanding of their goods trading relationships, and how those relationships power their local economies.

It’s time to have a frank conversation about what investments like the Panama Canal mean for US trade and economic growth.

First, let’s start with a little context. The Panama Canal, set to celebrate its 100th birthday next year, is one of the world’s most important trade assets. It primarily helps connect US Atlantic and Gulf ports to their trading partners in Asia, Oceania, and South America. Driven by those major markets, the Canal already moves over 330 million tons of freight each year.

However, the Canal suffers from capacity constraints. The world's largest ships can no longer fit through certain locks, meaning the Canal was ill-prepared for its second century. In response, Panama initiated a major overhaul including two new locks, plus widening and deepening several existing channels. When complete in 2015, larger container ships will expand potential trade volumes between the Americas and Asia--and more seamlessly connect global markets in the process. The promise of these larger ships is the inspiration behind the Atlantic ports’ major capital projects.

Yet, as ports carry out such extensive projects, questions and skepticism linger over the future direction of freight movement and the long-term economic implications. How will ports handle the extra time it takes to load and unload the new mammoth ships? How will Pacific port investments in the United States and Canada counter the investments at the Atlantic ports? These uncertainties complicate analysts’ and policymakers’ abilities to identify exactly how the expansion will shift the precise location and scope of all freight flows.

The country and its metropolitan leaders need a way to remove these uncertainties. And it begins with a better understanding of our current goods trading relationships at the metropolitan scale.

As it stands, metropolitan data is scant. There is no geographically-consistent database of what goods metropolitan areas consume and what goods they export. Similarly, there is no database of geographic trading relationships with their domestic and international peers, or which ports facilitate the international side of the trade ledger

Imagine if the United States didn’t know how much electronics it imported from China, or how much oil it imported from the Middle East. That’s the situation metropolitan economic and freight leaders face.

It’s time to get a better handle on these regional trade relationships. Local, state, and federal officials should know which metropolitan areas trade the most goods with Asia, and are therefore the most sensitive to the Panama Canal’s capacity. They should also know how these goods flow between markets—whether they’re more reliant on Pacific or Atlantic ports, and how a capacity change on either coast could shift that equation.

This kind of knowledge also extends beyond just the Panama Canal. As other freight investments come online across the United States and the world, public and private sector leaders should have the statistical tools to know what’s at stake. A more thorough understanding of the country’s metropolitan trading network would help inform local investment decisions like we’re seeing in Baltimore and Norfolk. It would also inform a national freight strategy that prioritizes investments with the highest returns.

The metropolitan reaction to the Canal widening is a microcosm for what the country misses when it comes to freight planning. In a relatively fact-free zone, it’s easy for local ports to justify these major investments. But dredging a port or building a tunnel costs significantly more than simply upgrading our knowledge base.

Even with global trade slowing its growth since the Great Recession, there’s little question that goods volumes will continue to rise in the coming decades, whether through the Panama Canal or elsewhere. It’s time we make sure our metropolitan economies have the knowledge to succeed in that environment.

The Brookings Metropolitan Policy team will aim to address that knowledge gap over the coming year. Working with a team of outside experts, we've assembled a geographically-consistent, globally-oriented goods trade database. In turn, the analytics from that database will help us provide public and private sector leaders with a better understanding of exactly what, where, and how metropolitan areas trade goods and the implications for their local economies. We are excited to start sharing those results this fall.

Authors

Adie Tomer
Joseph Kane

A Theoretical Framework for Kenya's Central Bank Macroeconometric Model

Maureen Were, Anne W. Kamau, Moses M. Sichei and Moses Kiptui — Fri, 17 May 2013 10:29:00 -0400

INTRODUCTION

This paper presents the theoretical framework for the Central Bank of Kenya (CBK) macroeconometric model. In addition, it highlights the theoretical base for the model’s main behavioral equations. The justification for the model relates to its usefulness in aiding the policymaking process at the CBK. It is expected that the model will support the Monetary Policy Committee (MPC) and Research Department in further understanding how the economy works through the complex interactions of various economic agents. The conduct of monetary policy requires fairly accurate analyses and forecasts backed up by sound economic theory and a rationale ensuring that effective monetary policy is formulated and implemented. In this regard, the model will provide consistent short-term forecasts of key macroeconomic variables such as economic growth and inflation. In addition, the model will be helpful in evaluating the impact of various shocks and policies on the economy. The MPC may also use the model as an instrument to help in structuring its communication with the public on the rationale behind its decisions.

This paper is organized as follows. The rest of Section 1 discusses the type of macro model developed, Section 2 presents the model’s logical and theoretical framework and illustrates the linkages between the monetary submodel and the other blocks of the model, Section 3 discusses the theoretical foundations of the model’s behavioral equations, and Section 4 concludes.

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Authors

Maureen Were
Anne W. Kamau
Moses M. Sichei
Moses Kiptui

Image Source: © Antony Njuguna / Reuters

The African Union Can Do More to Support Regional Integration

Michael Rettig, Anne W. Kamau and Augustus Sammy Muluvi — Fri, 17 May 2013 16:39:00 -0400

Earlier this May in Cape Town, South Africa, economists at the World Economic Forum reaffirmed that regional integration will play a key role in unleashing the continent’s growth potential. More than 10 regional economic communities (RECs) are working toward this goal in Africa, but the main framework behind this effort is the African Economic Community (AEC). The AEC was established by the Abuja Treaty in 1991 and ratified in 1994. The treaty aims to build the AEC gradually through harmonization, coordination and effective integration of Africa’s RECs, eight of which have been chosen as “pillars” of the AEC. It proposes the establishment of a continental free trade area (CFTA) by 2017, and integration of the RECs into a single customs union with a common currency, central bank and parliament by 2028. The Abuja treaty does not lay out precise, top-down steps for achieving this goal, but the African Union (AU) and the RECs have defined their relationship in working toward the AEC in the 2007 Protocol on Relations between the AU and the RECs. Towards this end, the Africa Union has embarked on various programs at the regional and sub-regional level to promote integration. Indeed, at the January 2012 AU Summit, heads of state from around the continent renewed this mission by agreeing to speed up plans for economic integration. The tone of the 2012 Summit implied an ambitious AU agenda of promoting and coordinating African integration and its accompanying benefits more quickly than before.

Like the European Union, the AEC would enjoy increased intra-African trade, improved self-sufficiency in meeting Africa’s import demand, lower poverty levels and a more peaceful interdependent existence. However, in contrast with these grand plans to move toward a CFTA, Africa’s RECs are grappling with numerous challenges. Though it is the responsibility of the RECs and individual countries to implement protocols and integrate, the AU Commission is charged with monitoring the continent’s integration process. The integration process has remained slow despite numerous efforts and working committees formed by the AU to coordinate the RECs, suggesting more work remains to be done. Now, many RECs have missed their target dates for implementing customs unions and common market requirements. For the RECs to achieve integration objectives and a CFTA to still take hold by 2017, the AU may have to play a more active role. Indeed, as the AU celebrates its 50th anniversary this May, the progress made and challenges encountered by Africa’s RECs offer valuable lessons as to how the AU can best act to improve integration, development and growth moving forward. Consider the progress of two RECs from Central and East Africa.

The East African Community (EAC) is composed of five countries in East Africa: Kenya, Uganda, Tanzania, Rwanda and Burundi. The EAC has achieved considerable milestones, having established a customs union in 2005 and a common market in 2010. It is scheduled to move to a monetary union by November of this year and ultimately to a political federation by 2017. In addition, the EAC has taken steps towards further economic integration by signing a free trade agreement with two other RECs, the Common Market for Eastern and Southern Africa (COMESA) and the Southern Africa Development Community (SADC). This progressive tripartite agreement eases the transitional problem of states’ memberships in multiple RECs and therefore multiple sets of requirements and regulations. Despite this progress, the EAC has not fully implemented their Common Market Protocol. While the EAC has made tremendous progress in eliminating tariffs, poor infrastructure and other non-tariff barriers remain. Lack of roads, railways and energy networks add to cost of doing business and make it difficult to increase intra-African trade and attract investment in the region. Moreover, neither the EAC nor the AU has effectively explained the benefits of economic integration to citizens, so the democratic leaders of member states do not feel pressure to improve their progress. In addition, national governments fear a loss in tax revenue, and, despite the elimination of border tariffs, different domestic tax rates still exist within the EAC. Indeed, harmonizing the various economic policies in the EAC has been challenging. As a result, member states are struggling to converge their macroeconomic policies in the prescribed time. Most notably, as the EAC has achieved its successes and struggled with its challenges, the AU’s efforts have barely influenced the integration process in the region.

Another REC, the Economic Community of Central African States (ECCAS), was first formed in 1983 and remained mostly dormant for 16 years until 1999. The group suffered first from states’ unwillingness to pay much-needed fees, and later from a war between some of its member states. Once the ECCAS began operating, it faced renewed challenges from competing economic communities—Rwanda left the group in 2007 to focus on its COMESA and EAC memberships. Unlike the EAC, which includes Kenya, the ECCAS lacks a high-growth country to provide leadership and capital in supporting regional infrastructure and pushing trade liberalization efforts. As a result, the ECCAS remains a group of states of varying levels of development focused on their own self-interests. The AU has an opportunity to educate the member states and apply informal pressure to make progress. In spite of these challenges, the ECCAS has achieved some successes. Many ECCAS members utilize a single currency, and capital moves freely across borders. Steps have been taken to eliminate tariffs as well, though these have yet to be fully implemented. The ECCAS has enjoyed more success in tackling peace and security—leading peace operations in the Central African Republic on two occasions and laying the foundation to host one of the AU’s planned Standby Forces. Indeed, the AU has been effective and proactive in assisting with these security gains (and also throughout the continent), yet the role of the AU in assisting with ECCAS’s economic integration successes has not been visible.

As the African Union reflects on its achievements 50 years since its creation, it should balance its successes in minimizing African conflict with the importance of doing more to promote economic integration. While addressing flashpoints of violence is an important short-term necessity, increasing intra-African trade, building an African consumer base, and networking African interdependence may offer great long-term promise. These are all steps toward the same goal of a prosperous and peaceful Africa. While the AU does not have the authority to overcome poor capacity, a lack of political will, or other challenges that African countries and RECs may face or bring to the table, it can and should better follow its mission in encouraging integration.

Under the 2007 Protocol, the AU is directly charged with working to facilitate and implement regional integration. If the AU hopes to realize its goal of a united Africa by 2028, it must better engage the continent’s RECs and assist in resolving the numerous obstacles they face. It should consider expanding its efforts to coordinate regional initiatives within low-capacity countries and work to ensure that future programs are better targeted and more visible. Further, the AU should exercise leadership in countries that seem not to have the domestic political will to move towards integration. It could also move from biannual meetings to more common ones and more vigorously assist in mobilizing resources and coordinating their application toward regional infrastructure projects to boost trade. The AU could even consider launching voluntary international governance initiatives, such as a two-term limit for political leaders or the teaching of a common language base. It can also more closely oversee and facilitate the long and difficult negotiations of protocols, and may use scorecards and penalties while monitoring their implementation to ensure that states feel pressure to meet their benchmarks. A continental free trade area in Africa holds as much potential as the one seen in Europe, but achieving success of this goal by 2017 will require the African Union to engage its regional economic communities more robustly.

Authors

Michael Rettig
Anne W. Kamau
Augustus Sammy Muluvi

Image Source: © Thierry Gouegnon / Reuters

Mapping the African Growth Landscape

Mwangi S. Kimenyi — Wed, 15 May 2013 13:29:00 -0400

Editor's Note: In this piece, Mwangi Kimenyi discusses Africa's integration following the session "Mapping the African Growth Landscape," held at this year's the World Economic Forum on Africa.

The session on Mapping the African Growth Landscape focused on the sectors that hold the greatest potential for economic growth in Africa. The session started with each of the participants voting for three sectors that they considered as having highest potential for growth. The sectors selected by most of the participants were: information communication technology and telecommunications; energy and engineering; entrepreneurship; education; manufacturing; and agriculture. The selection of these sectors was influenced not only by their potential to contribute to the growth of the economies, but also to creating jobs, especially for the youth.

Working in groups, participants identified opportunities and strategies for exploiting the economic growth potentials that the various sectors offer. Although many of the opportunities and strategies identified were specific to particular sectors, there were also some common themes. For example, innovation was identified as a source of potential growth in all sectors. This includes advances in the ICT sector, innovations in the delivery of education to ensure quality instruction or innovative approaches, developing entrepreneurship through entrepreneurship hubs and incubators or even innovations to improve governance using ICT. Innovation was also considered key to expanding the manufacturing sector and in agriculture, such as the introduction of genetically modified seeds. Participants were of the opinion that Africans must embrace innovations to fully exploit the growth opportunities of various sectors.

Participants focused on actions to exploit the growth potential afforded by the various sectors. The ICT sector was identified as having great potential for growth through expansion of mobile penetration with applications in health and industry. The sector was identified as presenting immense opportunity through the compilation of information on the population, which would assist in policies for the delivery of health services and in tax collection. Participants observed that the energy sector presents many opportunities for growth, but there is need to develop a forward-looking energy master plan for Africa, not just for individual countries. Many opportunities also exist for a diverse mix of energy sources including solar, hydro and thermal.

Read the full commentary and watch the related video »

Authors

Mwangi S. Kimenyi

Publication: World Economic Forum

Image Source: © Reuters Staff / Reuters

Iran’s Presidential Election Puts Populism to the Test

Djavad Salehi-Isfahani — Wed, 15 May 2013 17:25:00 -0400

Economic issues are paramount on the minds of Iranian voters as they ponder the long list of candidates registered for president: who among them is likely to survive the vetting by the Guardian Council, and, of those, who offers the best plan to get Iran’s economy out of the rut it has been in for the last several years?

Since the last election in 2009, the economy has stopped growing, more people are unemployed, prices have skyrocketed, and the currency has lost more than half of its value. Not all of these are the fault of outgoing President Ahmadinejad — sanctions have tightened considerably since he started his second term in 2009. But for the last several months the economic debate in Iran has been dominated by both his conservative and reformist critics who charge that his populist policies have brought economic ruin.

Three large programs define this populist legacy of redistribution. The first was a large $40 billion lending program for small enterprises, known as the “quick-returns projects”, which started in 2006 and was already widely considered a colossal failure before the 2009 election. The 2011 census revealed zero net jobs added to the economy since the program’s inception. Meanwhile, the public banks that were forced to lend to these projects have been left with huge unpaid loans. This large expansion of credit that failed to bring much additional output spurred the inflationary spiral that would later define the Ahmadinejad presidency.

The low-cost housing scheme, known as Maskan Mehr, also turned out to be highly inflationary because it relied on public lending to low-income people, forcing the banks to increase their borrowing from the Central Bank by about $40 billion and adding even more to liquidity.

The third, and most controversial, is the subsidy reform program, which redistributed some $70 billion worth of energy subsidies — most of which benefited people in middle- and upper-income groups — more equitably by replacing them with cash transfers. It also proved inflationary because the amount of cash distributed exceeded the cost of the energy subsidies that had been removed by an estimated $15 billion per year. The last two programs are still ongoing and have come under sharp attack, from both reformists and conservatives.

There seems to be a widespread perception among Iranian voters that Mr. Ahmadinejad has failed to deliver on his promise, first made in the 2005 elections, to “bring the oil money to the dinner table.” But this does not mean that the public is ready to give up on redistribution. If there is a program that promises them what they are looking for – redistribution without inflation – they will support it. But such a program is not currently to be found among the plans of any of the declared candidates.

Mr. Rafsanjani’s dramatic entrance into the election fray last Saturday is in part motivated by the hope that after eight years of redistributive policies, a majority of voters are now ready to view the type of pro-growth and pro-market policies that he spearheaded as president from 1989 to 1997 with more sympathy. He has certainly already won the support of the left-leaning reformers who, ironically, heavily criticized his structural-adjustment policies then.

Mr. Mashai’s equally dramatic registration on Saturday (with President Ahmadinejad at his side) is to convince voters that with more time populists will deliver on their promises. They should be assured of sizeable support from lower-income people, especially those who have benefited from his cash transfers.

The subsidy reform has been putting 450,000 rials per person per month in individual bank accounts since January 2011. While the value of this transfer has declined due to inflation – when it started it was worth about $45 but is now worth less than half as much — it amounted to about 50% of the per capita expenditures of the poorest 10% of the population in 2011. With unemployment at record levels, they would find themselves in extreme poverty if this transfer is substantially reduced or eliminated. As much as half of the country’s total population are net beneficiaries of the cash transfer program because the energy subsidies they replaced were highly regressive.

Mr. Rafsanjani’s put-down of cash transfers in 2008 as “fostering beggars” is unlikely to endear him to the poor and the jobless. Convincing them that they would do better with real economic growth makes economic sense but will be a hard sell politically to this group. He may not need them, however, because the middle- and upper-income classes for whom the cash transfer matters little — for the top decile, it makes up only 5% of their expenditures — account for some 40% of the electorate.

Candidates from conservative factions, known as “Principlists”, have so far gotten away with simply pointing out what they are against – inflation, unemployment, and bad implementation of good policies by the current administration. They have been careful to stress their commitment to continue the two remaining programs – subsidy reform and low-cost housing – but manage them better.

But the arrival of Mssrs. Rafsanjani and Mashai on the electoral scene will force them to define more precisely how they plan to bring about economic growth while continuing the most important policies of the Ahmadinejad administration. If the Guardian Council, which has the final say on who can run, allows this election to become a three-way race between populist, pro-growth, and Principlist philosophies, the conservative candidates will have to say more clearly what they are for, not just what they are against. Without it, they are likely to find themselves squeezed between the two better-defined alternatives.

Authors

Djavad Salehi-Isfahani

Publication: Lobe Log

Image Source: © Morteza Nikoubazl / Reuters

GCI Houston: Greater Houston and the Next Economy

Bruce Katz — Wed, 15 May 2013 00:00:00 -0400

Editor's Note: On May 15, 2013, Brookings vice president Bruce Katz spoke at the Houston convening of the Global Cities Initiative, a joint project of Brookings and JPMorgan Chase to catalyze high-level discussions of metropolitan leadership in the world economy and the actions metro leaders can take to improve trade relationships with cities in mature and rising markets. Hosted by Rice University, the forum brought together distinguished regional, national, and international leaders from the business, civic, government, and philanthropic communities to explore how the greater Houston area can enhance its ability to compete globally.

Bruce Katz - Global Cities Initiative

View the agenda »

Authors

Bruce Katz

Going Global: Greater Houston’s Economic Future

Wed, 15 May 2013 13:30:00 -0400

Event Information

May 15, 2013
12:30 PM - 2:00 PM CDT

Baker Hall
Rice University, James A. Baker III Institute for Public Policy
6100 Main Street
Houston, TX 77005

As the United States emerges from the Great Recession, it is clear that the nation’s economy must be purposefully restructured from one focused inward and characterized by excessive consumption and debt to one that is globally engaged and driven by production and innovation. A growing chorus of leaders is calling for a new growth model, one that creates more and better jobs by engaging rising global demand and attracting global talent and capital. These leaders recognize that only by harnessing the power of cities and metropolitan areas can the country hope to foster job growth in the near term and restructure the economy for the long haul.

On May 15, the Metropolitan Policy Program at Brookings and JPMorgan Chase hosted a forum at Rice University, “Going Global: Greater Houston’s Economic Future,” the second in a series of domestic and international forums being convened this year by the Global Cities Initiative. This is the second year of the five-year initiative. The forum explores how metropolitan-led economic growth—including global trade and investment—are important for job creation, and how Metropolitan Houston can leverage its position in the global market.

Speakers and panels provided context on the region’s position in the global marketplace and offered insight into how area leaders can work together with international partners to expand global trade and enhance Houston’s economic prosperity.

Join the conversation on Twitter with hashtag #GlobalCities. Photos courtesy of John Everett.

Roundtable Presentations:

View Bruce Katz's presentation on Houston's next economy »
Download Marek Gotman’s presentation on workforce development (PDF) »
Download Amy Liu's presentation on regional export planning (PDF) »

Bruce Katz, Brookings Vice President & Founding Director, Metropolitan Policy Program

Gina Luna, Chairman of JPMorgan Chase for Houston

Bruce Katz, Brookings Vice President & Founding Director, Metropolitan Policy Program

Video

Event Materials

Participants

Moderator

Amy Liu

Co-Director and Senior Fellow, Metropolitan Policy Program

Panelists

Bruce Katz

Vice President and Director, Metropolitan Policy Program
The Adeline M. and Alfred I. Johnson Chair in Urban and Metropolitan Policy

Honorable Peter Ammon

Ambassador

Honorable Richard M. Daley

Former Mayor of Chicago
Chairman

Dr. David Leebron

President

Gina Luna

Houston Market President

Amy Liu

Co-Director and Senior Fellow, Metropolitan Policy Program

David McClanahan

President and CEO

Strengthening U.S. Manufacturing, Region by Region

Mark Muro — Mon, 13 May 2013 16:17:00 -0400

Last week President Obama used his trip to Austin, TX to announce the creation of three more public-private manufacturing research institutes as nodes of a $1 billion National Network for Manufacturing Innovation (NNMI). On the same day, though, there was another intriguing if lower-key announcement on the Obama administration’s manufacturing agenda.

That’s the new Investing in Manufacturing Communities Partnership, the first phase of a two-phase effort aimed squarely at communities and regions, announced by the Commerce Department’s Economic Development Administration (EDA).

Focused squarely on the fact that the locus of U.S. manufacturing prowess is emphatically local and regional, the new competitive solicitation will allow as many as 25 local communities to be awarded $200,000 this year to create smart strategies for leveraging and aligning their public- and private-sector assets to provide a promising environment for advanced manufacturing. These awards will in the near term allow ambitious communities to develop “bottom-up” plans for strengthening their regions’ intellectual, human, and physical infrastructure.

But beyond that, the small grants and the resulting regional strategies will also help prepare a cadre of U.S. regions to compete for the second phase the partnership, which will next year entail a competition that will award (contingent on congressional support) five to six U.S. communities with up to $25 million for the implementation of regional advanced manufacturing strategies. That’s real money that would—like the full build-out of the NNMI initiative—allow for real strides in advancing U.S. manufacturing in the country.

Yet, while such material awards would be welcome, what is key to the Manufacturing Communities Partnership is its four-square focus on the local and regional angle. For several years now we at the Metro Program have been harping on the sub-national underpinnings of manufacturing competitiveness and the importance of recognizing those underpinnings, establishing state and regional innovation centers to foster them, and making sure to embed regional advanced industries hubs in their surrounding industry clusters and supply chains. Most recently my colleagues Bruce Katz and Peter Hamp proposed creating a “Race to the Shop” competition aimed at calling forth bold regional visions for advanced industry growth, rewarding those visions, and better organizing disparate federal programs in support of the strategy.

We believe all of this is critical because advanced industry dynamism does not grow up just anywhere. Rather, industries reach critical mass in places—most notably, metropolitan places—where firms and workers tend to cluster in close geographic proximity whether to tap local supplier networks, work with local research institutions, draw on local workers, or profit from formal and informal knowledge transfer. In this respect, smart companies are more and more deciding where to locate facilities and hire workers based on the quality of a community’s infrastructure, institutions, and human capital—what the Harvard Business School scholars Gary Pisano and Willy Shih call its “industrial commons” and others its “industrial ecosystem.” The upshot: If U.S. regions—working with their states and the federal government—can bolster the density, efficiency, and vitality of the nation’s regional industrial clusters they will add to overall advanced industry competitiveness.

Broadly then, the EDA and its agency partners are not restricting themselves solely to broad (and needed) national and macro-economic policies on research, trade, taxes, and regulations. Instead, by going local, they are getting at the regional sites in communities where manufacturing supply chains actually come together and generate prosperity. That’s a good place for federal manufacturing policy to be.

Authors

Mark Muro

Image Source: © Aaron Josefczyk / Reuters

This Week in Immigration

Nicole Prchal Svajlenka — Mon, 13 May 2013 16:46:00 -0400

The immigration reform legislation debate is ramping up with last week’s activities including hearings at the Joint Economic Committee, Senate Committee on Homeland Security and Government Affairs, and Senate Committee on Commerce, Science, and Transportation.

But by far, the star of the week was the Senate Judiciary Committee’s markup of S.744. By Wednesday, over 300 amendments were filed. You can find the Senate Judiciary Committee’s official list of amendments and actions here. The American Immigration Lawyers Association (AILA) is on the ball with the ins and outs of the legislative process—check out their compilation of each amendment’s “stated purpose” in one document.

After the flurry of amendments, no real surprises emerged, but Sens. Jeff Sessions, Chuck Grassley, and Ted Cruz, all Republicans, look to be the biggest kill-the-bill proponents. On the left, the most controversial amendment covers the rights of gay couples, filed by committee chairman Sen. Pat Leahy (D-Vt.)

The first day was focused on the bill’s first title, border security. Sen. Leahy’s office offers a “recap” on the first day of markup, including details on the 22 amendments passed, six rejected, and four withdrawn. Also helpful is AILA’s detailed summary. Perhaps the most notable accepted amendment comes from Sen. Grassley and expands the border security plan from only “high-risk” sections to the entire southern border. As reported by ABC News Univision, some of the adopted provisions on border security play a political game to attract conservative support in the House, while tougher “trigger” amendments were rejected. The markup will resume Tuesday, most likely with high-skilled temporary immigration.

We still have not seen anything from the House’s “Gang of Eight,” and as reported by The Hill, Democratic Rep. Luis Gutierrez says if they do not introduce their bill by the end of the month, they will not introduce anything. Is the glass half empty or half full?

Off the Hill, Monday’s Heritage Foundation report, claiming legalization would cost $6.3 trillion, has been hotly contested; the pushback from the right has been loud and swift. The fallout continued after details emerged about co-author Jason Richwine’s dissertation, which claimed “the average IQ of immigrants in the United States is substantially lower than that of the white native population,” and tied IQ to genetics and race. On Friday, Richwine resigned from Heritage.

There was another cost-benefit analysis last week, but it hasn’t garnered the same attention as the disputed Heritage report. According to a study requested by Sen. Marco Rubio (R-Fla.), the Social Security Administration estimated passage of immigration reform would “boost Social Security’s coffers by more than $240 billion over the coming decade and add $64 billion in new tax revenues to Medicare. It would also increase the size of the economy by a full percentage point by 2017, and increase employment.”

Tensions on temporary workers are still simmering. On Point took up the issue of H-1B workers, with a rousing debate among panelists. My colleagues Jonathan Rothwell and Neil G. Ruiz look at the misconceptions surrounding the STEM shortage and H-1B visas. On the lower-skilled side, the New York Times reported on hiring practices for farm workers that might pit native-born and foreign-born workers against each other.

At the state level, Colorado has been the site of some immigration legislation this week. The state legislature passed laws allowing driver’s licenses for undocumented immigrants and in-state tuition for some undocumented college students.

Authors

Nicole Prchal Svajlenka

Image Source: © David McNew / Reuters

Six Major Decision Points for Uhuru Administration

Eric Aligula and Anne W. Kamau — Sun, 12 May 2013 16:18:00 -0400

On March 4, 2013 Kenya successfully concluded elections under the new Constitution, ushering in new leadership in a devolved form of government.

President Uhuru Kenyatta and Deputy President William Ruto are faced with the surmountable but difficult task of revamping economic growth and implementing the new supreme law while seeking to deliver on promises made to Kenyans during their campaign.

The new government is faced with a tight resource environment within which to manoeuvre, hence the need to carefully identify priorities that will facilitate the quantum leap of the economy in the next five years, including measures to achieve an appropriate balance between private and public sector investments in the economy. Kenya’s economic performance in the last five years has been on the upswing from its low 2008 performance, but still faces some challenges. In 2010, 2011 and 2012, the economy grew at 5.8 percent, 4.4 percent and 4.5 percent per annum, respectively.

It is projected to grow at an annual rate of 5.1 per cent, 6.0 percent and 7.1 percent in 2013, 2014 and 2015. However, these growth rates remain below the psychological 10 per cent per annum target which is also under the national development blueprint Vision 2030.

As a matter of fact, this administration has promised a double-digit growth rate. Government resources are stretched with a rising wage bill estimated at Sh458 billion, which is about 12 per cent of gross domestic product (GDP).

Read the full article on Business Daily »

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Eric Aligula
Anne W. Kamau

Publication: Business Daily

Image Source: © Marko Djurica / Reuters

Minority Turnout Determined the 2012 Election

William H. Frey — Fri, 10 May 2013 16:49:00 -0400

While it may seem like the 2012 presidential election has been analyzed to death, the recent release of the Census Bureau’s November election survey points out the key role that minority voter turnout, especially for blacks, played in determining the outcome.

Until now, most of what we knew came from the National Election Pool exit poll which elicited Election Day candidate preferences of voters. The new, larger survey from the Census Bureau permits an examination of the voting-eligible population and the extent to which they turned out to vote. These turnout rates tell us a lot more about the enthusiasm, or lack thereof, among different groups.

Already, the Census Bureau’s report trumpeted the historically noteworthy finding that black turnout rates in 2012 exceeded that of whites for the first time. This, in an election when white turnout declined significantly and Hispanic and Asian turnout inched down modestly from 2008.

The rising black turnout can be viewed, to some degree, as continued strong support for the first black president. The downturn of white turnout might be attributed, in part, to a lack of enthusiasm for either candidate or politics in general during a sluggish economy.

Before the election I made the case that a Democratic win would require a high minority turnout rate to counter what I then thought would be high turnout on the part of an energized Republican-voting white population. According to these new data, I was wrong about the rise in white turnout. But the question still remains: Was high minority turnout necessary for Obama to have won the national vote?

Changing Demographics, Turnout and Voting Margins

To answer this question now and in the future, an examination of the role of turnout in the context of the changing face of America’s electorate and the strong racial and ethnic preferences for Democratic and Republican candidates provides insight.

From purely an accounting perspective, shifts in election outcomes can be viewed as a product of (1) demographic changes in the eligible voter population; (2) changes in the turnout of different groups of eligible voters; and (3) the candidate preferences of those who vote. A look at the patterns for the three previous elections shows a striking move toward the Democrats on each of these dimensions.

With respect to eligible voters, the (typically Republican-leaning) white share of the electorate declined from 75.5 to 71.1 percent between 2004 and 2012 (Figure 1). During this period, the (typically Democratic leaning) combined black and Hispanic electorate rose to approach nearly quarter of eligible voters—a fraction that will rise in the future as more U.S.-born Hispanic children reach age 18.

In contrast to the constant shifts in eligible voter demographics, racial and ethnic trends in turnout and voter margins take a sharper turn after 2004.

White turnout continued to dive after the 2004 election when it was at a post 1992 high (Figure 2). In contrast, minority and especially black turnout moved in the opposite direction. The black turnout rates of 64.7 percent and 66.2 percent in the past two elections were the highest since 1968 when Census surveys began. Hispanic and Asian turnout improved markedly after 2004. For both groups, turnouts for the 2008 and 2012 elections were higher than any year since 1992.

With respect to voting margins, all three minority groups favored Democrats more strongly in the two post 2004 elections (Figure 3). The “tepid” 2004 black Democratic margin of 77 rose to 91 and 87 in the subsequent two elections, the highest margins in 40 years. Hispanic and Asian margins for Democrats also rose markedly for 2008 and 2012

For whites, the 2004 Republican margin was high by historical standards at 17. It declined in 2008 but then rose to an extremely high 20 in 2012—the largest white Republican margin since the 1984 Reagan-Mondale election.

So overall, compared with 2004, minorities showed: higher shares of eligible voters, higher turnout rates, and higher Democratic margins in the two most recent elections. For whites, on the other hand, post-2004 elections showed smaller shares of eligible voters and lower turnout. White voters did vote more strongly Republican in 2012, but this was offset by reduced turnout

The result, of course, was Obama wins in both 2008 and 2012. But how much of this is due to the rise in minority turnout and decline in turnout for whites?

With 2004 Turnout Levels: Republicans win in 2012 but not 2016

To assess the impact of turnout alone on the 2012 election I assumed that the national electorate had the size and racial and ethnic composition of the new Census survey and applied to it the more “Republican favorable” turnout rates of 2004 for each racial and ethnic group, as shown in Figure 2. This of course resulted in more white voters and fewer minority voters than actually occurred in 2012. To these voter populations, I applied the actual 2012 voting margins as shown in Figure 3. The result of this exercise was a small 2012 Romney win of 9,000 votes—a virtual tossup. Thus it might be said that the high minority and low white turnout rates of 2012 were responsible for Obama taking the national vote, irrespective of the changing demography of the electorate.

To see how much difference the higher 2012 turnout of minorities alone made in the final outcome, I conducted the same exercise assuming the “low” 2004 turnout rates for blacks, Hispanics and Asians, but with the actual 2012 white turnout rates. Under this scenario, the 2012 election is close with Obama ahead, but barely. So we might say that the high turnout of minorities, and blacks especially, did make a difference in the outcome of the 2012 election.

As a final exercise, I produced projections for the 2016 and 2020 elections which adjust Census Bureau population projections to estimate eligible voter populations by race and ethnicity in those years. Again, I contrast election outcomes, assuming 2004 “Republican favorable” versus 2012 “Democratic favorable” turnout rates, but in each case applying 2012 voter margins to each racial and ethnic group. This time, the Democratic candidates win under each scenario in each election, though with smaller margins when 2004 turnout rates are assumed.

What this tells me is that turnout will be less important for Democratic victory as demography changes in their favor, though they must maintain their strong voting margins among blacks, Hispanics and Asians. For Republicans, the latter projections show that they cannot count primarily on white support to take the White House. Even assuming high 2004 turnout rates and 2012 Republican voting margins for whites, they cannot win unless they also peel off more votes among minorities. In this regard, demography indeed becomes destiny.

Authors

William H. Frey

H-1B Visas and the STEM Shortage

Jonathan Rothwell and Neil G. Ruiz — Fri, 10 May 2013 11:01:00 -0400

Last month, a landmark immigration reform bill was introduced in the U.S. Senate that has the potential to both increase the number of available H-1B visas for foreigners working in specialty occupations and shift the U.S. employment-based visa system to a more merit-based scheme favoring science, technology, engineering, and mathematics (STEM) workers.

As it stands today, businesses say they cannot find the skills they need in the domestic labor pool and need access to a global pool of STEM workers. Bolstering their contention are a number of studies that suggest that STEM jobs exhibit characteristics of under-supply: high wages and low unemployment.

Yet, some analysts have argued that there are plenty of U.S. native-born workers who can do these jobs. They claim that H-1B workers do not have special skills but instead are preferred because they are paid lower wages.

Without attempting to fully resolve this complex issue, new detailed data on H-1B wages by occupation, presented more fully here, suggests that the H-1B program helps to fill a shortage of workers in STEM occupations.

Employers request H-1B visas for hard-to-fill STEM jobs. The vast majority—90 percent—of H-1B applications are for jobs requiring high-level STEM knowledge. This finding is based on our analysis of Department of Labor survey data on the knowledge needed to perform occupations. The evidence shows that these vacancies are harder-to-fill than other job openings.

Labor market experts interpret the duration of a job opening as an indicator that qualified candidates are hard to find. Such an interpretation of vacancy survey data is empirically grounded in both historical and many contemporary labor market surveys from private firms and state governments.

Using 2011 job openings data from the Conference Board for the 100 largest metropolitan areas, we find that 43 percent of job vacancies for STEM occupations with H-1B requests are reposted after one month of advertising, implying that they are unfilled. By contrast 38 percent of vacancies in non-STEM occupations requiring a bachelor’s degree go unfilled after one month, and just 32 percent of job postings for all non-STEM occupations. In a statistical analysis of over 50,000 openings, we find that those requiring STEM knowledge take significantly longer to fill, even controlling for requirements for education, experience, training, and managerial knowledge, as well as wage rates and metropolitan area location. The most commonly requested H-1B occupations in each metropolitan area also take longer to fill.

H-1B visa holders earn more than comparable native-born workers. H-1B workers are paid more than U.S. native-born workers with a bachelor’s degree generally ($76,356 versus $67,301 in 2010) and even within the same occupation and industry for workers with similar experience. This suggests that they provide hard-to-find skills.

To reach this conclusion, we analyzed 2010 H-1B petitions obtained from labor economists Magnus Lofstrom and Joe Hayes through a Freedom of Information Act (FOIA) request filed at the U.S. Citizenship and Immigration Services. We combined these data with micro-records from the American Community Survey to compare employed the U.S. native-born with a bachelor’s degree to their H-1B counterparts.

Like Lofstrom and Hayes, we find that H-1B workers earn more than Americans in the same occupation and age cohort. The 20 most common cohort-minor occupation combinations found in the H-1B program are listed below. These groups comprise roughly three-quarters of all H-1B workers in the database. In 17 of the 20 groups, wages are significantly higher for H-1B workers, and there is a significant negative difference only for life scientists aged 30 to 35. For the three largest computer occupation groups, wages are much higher.

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Wages are increasing in occupations with most H-1B requests. In recent years, from 2009 to 2011, nominal wage growth for U.S.-born workers with at least a bachelor’s degree has been high for the most prominent H-1B occupations. The average native-born worker experienced flat annual growth in wages over that period (0.0 percent), but wage growth for those in computer occupations—the largest H-1B category—grew by 1.3 percent each year since 2009 and 2.7 percent each year since 2000 for those with a bachelor’s degree. Wage growth was even higher for engineers, with 2.1 percent growth since 2009 and 3 percent growth since 2000.

For every prominent H-1B occupational category except life scientists and operations specialties managers, wage growth was stronger than the national average since 2009. Since 2000, all but postsecondary teachers have seen higher than average wage growth.

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There are two important caveats. First, hard-to-fill high-skilled jobs do not always require many years of post-secondary training. Even among H-1B visa requests, about 25 percent are for occupations that typically require only an associate’s degree, meaning that the current U.S. workforce could be trained to do these jobs at relatively little cost. Second, not all STEM jobs are experiencing the same symptoms of shortage.

A data-driven bureau is needed to identify occupational shortages. Overall, there is compelling evidence that the H-1B visa program is helping to alleviate acute shortages in various occupations. Yet, because of data limitations, the evidence is far from complete. If the Senate bill is passed into law, the proposed Bureau on Immigration and Labor Market Research should collect better information from employers about job openings, including occupations, the number of qualified applicants, the number of interviews conducted, and the length of time it takes to fill the job. Likewise, the bureau should also consider how demand and supply play out in regional or metropolitan area labor markets, since job search and recruitment often happen locally. Armed with such information, as well as indicators presented above, visas and public funding for training and education in hard-to-fill occupations could be more confidently allocated.

Authors

It Takes Two: Immigration and the Rule of Law

Peter Skerry — Thu, 09 May 2013 10:20:00 -0400

With an immigration bill finally on the table, Republicans would do well to stop and ponder how they have arrived at this juncture. Since the November election they have been preoccupied with how to approach Hispanics on this critical issue. Because almost 80 percent of illegal immigrants are Hispanic, conservative elites have—appropriately—been wrestling with terminology and have just about persuaded themselves that “illegals” are more prudently referred to as “the undocumented.”

But the soul-searching seems to have stopped there. Whatever they call them, Republicans continue to insist that the undocumented must be treated as law-breakers, even as criminals, who must be penalized and not allowed to benefit from their transgressions. For a party struggling to renew itself, this isn’t much progress. What Republicans now need to consider is that the undocumented are hardly the only law-breakers here. More precisely, Republicans must assess how much responsibility for illegal immigration can be fairly attributed to employers.

This won’t be easy. Especially at this juncture in the process, no one wants to point fingers—certainly not at employers who are complicit in illegal immigration. To be sure, back in 2009 the Obama administration prioritized the criminal prosecution of employers who hire the undocumented and brought some large firms to heel. But right now, Democrats want to mobilize their troops and focus attention on the travails of worthy newcomers who just happen to be here without documents.

Republicans, as I have suggested, have their own problems. For them, immigration enforcement has meant securing our border with Mexico, for which public support has been readily mobilized with images of imposing physical barriers, sophisticated surveillance technology, and thousands of Border Patrol agents. By contrast, interior enforcement has been a much tougher sell. After all, it arouses images of busy Americans being hassled at highway checkpoints or hard-working businessmen wasting their time filling out government forms and answering the questions of intrusive bureaucrats. And since employers tend to be well organized and vocal when it comes to immigration, Republicans have sought to avoid offending what looks to be a natural constituency. But then so have many Democrats.

As for the rest of us, Americans tend to identify with employers, who are like “us.” In many cases the employers are us, insofar as they are homeowners relying on laborers, gardeners, painters, carpenters, cleaning ladies, and nannies, who are typically undocumented.

In fact, casual reliance on illegal immigrant workers is unlikely to run afoul of the law. Individuals who hire fewer than 10 illegal workers during any 12-month period are effectively exempt from prosecution. To be sure, candidates for high government appointments and politicians are subject to embarrassing exposure on this point, and they might be legally vulnerable for failing to pay Social Security taxes for undocumented workers. But the average American can still drive down to the Home Depot parking lot and hire a day laborer without fear of violating the law.

And so it has been for most of our history. It was not until 1986, when Congress enacted the Immigration Reform and Control Act (IRCA), that employers were prohibited from hiring noncitizens lacking work authorization. Up to that time, to be sure, it had been a felony to harbor illegal aliens. But at the insistence of agricultural interests, the so-called Texas Proviso stipulated that employing illegals was not to be construed as harboring them. So those who insist on upholding “the rule of law” would do well to consider how immigration law has evolved and changed.

In any event, IRCA changed all that, and for the first time, employers—excepting the homeowners described above—became subject to fines and prosecution for hiring undocumented immigrants. Yet an unholy alliance of immigrant advocates, business interests, and civil libertarians raised alarms about the creation of a “national identity card” and stymied efforts to create a secure means of identification that would allow employers to reliably determine the legal status of job applicants. At the same time, Congress enacted anti-discrimination provisions to discourage employers from avoiding the risk of hiring illegal immigrants simply by not hiring foreign-looking applicants. The result is that employers have been required to ascertain the legal status of their employees but discouraged from doing so aggressively.

It gets worse. To establish their eligibility for employment, applicants may rely on driver’s licenses, Social Security cards, and birth certificates—all of which can be counterfeited. Yet employers are not required to verify the authenticity of such documents, merely to confirm that they “reasonably appear on their face to be genuine.” Documenting all this on the now-infamous I-9 form completes the ritual and allows employers to satisfy the letter of the law by affirming that they did not knowingly hire undocumented workers.

Despite such ease of compliance, employers—no one knows how many—still evade or violate the law outright. Many hire undocumented workers indirectly by relying on subcontractors who assume the risk of skirting the law. Perhaps most notorious for this tactic is Walmart, which has used subcontractors who secured undocumented workers to clean its stores. Much less notoriously, homeowners routinely hire, for example, landscaping contractors who employ illegals. Technically, such homeowners are not in violation of the law, but this was small consolation to Mitt Romney a few years back. More blatant is the hiring of undocumented workers off-the-books and paying them substandard wages “under the table” with no benefits.

Such common practices highlight why American employers have grown so dependent on illegal immigrant workers. The usual explanation is lower wages, which are undeniably part of the story. Yet not to be overlooked is the willingness of undocumented workers to work long hours on short notice. As economist Gordon Hanson has pointed out, illegals are valuable to employers precisely because they are more flexible and responsive to market forces than other workers. This is particularly true in agriculture but also in construction and the service industry.

Authors

Peter Skerry

Publication: The Weekly Standard

This Week in Immigration: Senate Markup

Nicole Prchal Svajlenka — Tue, 07 May 2013 10:22:00 -0400

Last week, we saw the first modifications to immigration, specifically student visas, in light of the Boston Marathon bombings. Two of Dzhokhar Tsarnaev’s friends, Kazaks in the United States on student visas, were “charged with conspiring to obstruct justice.” Now, as reported by the Associated Press, “The Homeland Security Department ordered border agents to verify that every international student who arrives in the U.S. has a valid student visa.”

While many senators were visiting their districts during the recess, there’s still plenty to report on. May Day rallies in support of comprehensive reform and citizenship were scattered throughout the country, including an event with Sen. Harry Reid in Las Vegas. Sen. Orrin Hatch “appears willing to support” reform that includes a pathway to citizenship. “Gang of Eight” Sens. John McCain and Lindsey Graham were on the town hall offensive to promote their proposed legislation. Markup begins this week; be sure to check out this Politico piece, detailing what kind of amendments you can expect to see and from whom.

Representatives in the House are slowly releasing individual legislative pieces. The first, introduced by Reps. Bob Goodlatte and Lamar Smith, is an expansion of E-Verify. The second, introduced by Goodlatte, is an agricultural guestworker program. With a flexible cap but 500,000 visa minimum, it looks like there is a lot to work out between the House and Senate.

President Obama visited Mexico and Costa Rica last week, and immigration reform became a central focus. Prior to his trip, Obama held hosted an advocate briefing at the White House. As reported by the Washington Post, Janet Murguía, President of the National Council on La Raza was in attendance and recalled Obama’s remarks: “He said, ‘If the bill were presented on my desk today, I would sign it,’” and “He looked at the advocates and said, ‘We’re not going to get everything we want in this.’”

Sen. Marco Rubio continues to be at the front and center of immigration reform. Over the last week, we learned Rubio doesn’t have high hopes for the Schumer-McCain bill in the House, considers provisions for same sex couples a deal breaker, and published a high-profile op-ed in the Wall Street Journal. The New York Times also reported on the relationship between Rubio and former Sen. Jim DeMint, his one-time “mentor.”

If there is a rift between Rubio and DeMint, it looks like it will only continue to grow. Today DeMint’s Heritage Foundation released a report on the fiscal impacts of the Schumer-McCain bill, making immigration reform look very costly. The libertarian Cato Institute especially pushes back on Heritage’s methodology, already releasing a rebuttal. The reason? Heritage uses a “static fiscal scoring” as opposed to “dynamic fiscal scoring” that assesses the impact among all sectors of the economy.

While Heritage’s report on the costs of immigration reform will cause a stir, I’ve been enjoying NPR’s coverage of the economic impacts of different aspects of immigration. Stories on costs of “farmworker shortages,” impacts of reform on “low-wage black workers,” and how “major American companies benefit from undocumented workers” have all been on-point.

Authors

Nicole Prchal Svajlenka

Displacement and Migration Policies: Exploring the Interconnections

Tue, 07 May 2013 13:30:00 -0400

Event Information

May 7, 2013
1:30 PM - 3:00 PM EDT

Saul/Zilkha Rooms
Brookings Institution
1775 Massachusetts Avenue NW
Washington, DC 20036

People leave their communities and their countries for many reasons. Sometimes they are forced to flee because of conflict or disasters; in some cases they cross an international border and are recognized as refugees. More often, they remain within the borders of their country and are known as internally displaced persons (IDPs). At the same time, even larger numbers of people leave their communities in search of economic opportunities or to join family members. Their positive contribution to the economic, social and cultural development of both sending and destination countries is today widely acknowledged. The international system distinguishes between those who are displaced and those who migrate voluntarily and between those who move within or across national borders. But in practice, the lines aren’t so clearly drawn, posing challenges to governments and human rights advocates.

On May 7, the Brookings-LSE Project on Internal Displacement analyzed the interconnections between displacement and migration with reflections of U.S. and Swiss policy by Anne Richard, assistant secretary of the Bureau of Population, Refugees, and Migration at the U.S. Department of State and Ambassador Claude Wild, head of Human Security Division at the Swiss Federal Department of Foreign Affairs. Chaloka Beyani, United Nations Special Rapporteur on the Human Rights of IDPs and co-director of the Brookings-LSE Project on Internal Displacement, offered comments based on his observations in the field. Senior Fellow Elizabeth Ferris, co-director of the Brookings-LSE Project on Internal Displacement, moderated the discussion.

World Economic Forum on Africa: Delivering Africa’s Promise

Mwangi S. Kimenyi — Mon, 06 May 2013 12:19:00 -0400

The World Economic Forum (WEF) on Africa was established in Davos, Switzerland in 1990. Since then, the Forum has brought together thousands of world leaders, government officials, business executives and policy experts to discuss the various opportunities and challenges that Africa faces in pursuit of improving the continent’s economy and quality of life of her inhabitants. Broadly, the WEF on Africa has provided a platform for high-level debates and an exchange of ideas on economic and political issues affecting the continent. The primary objective of the WEF is to improve the state of the world by engaging political, business and policy leaders in shaping regional and industry agenda. Annual forums have dealt with different themes that reflect the realities of the day consistent to the objective of the WEF. Naturally, with the major changes that have taken place in Africa’s political and economic landscape over the past 23 years, the themes of the annual forums have also varied significantly.

This year, the WEF on Africa will be held on May 8-10 in Cape Town, South Africa. The theme of the Forum is “Delivering Africa’s Promise.” This theme is informed by the good economic performance that African countries have recorded over the past decade but with the realization that the benefits of growth have not reached many of the people and that there are many forces that could reverse the growth trends in the future. Although the recent growth has resulted in a large and growing middle class, the benefits of growth have not been shared by the majority of the population. Growth has occurred amidst increasing inequality and joblessness, especially among youth. In essence, the good economic growth has not really made a difference to the livelihoods of millions of Africans. Furthermore, although it is expected that Africa will continue to record decent rates of growth over the near future, there are many potential risks to sustained growth, such as the volatile global situation, the limited diversification of the continent’s productive structures and associated dependence on commodities, the many barriers to competitive economies—such as the large infrastructure deficit—and leadership and skills shortfalls.

The Cape Town forum will focus on issues that are key to unlocking Africa’s potential and sustaining high rates of economic growth that are also inclusive. These include strategies to accelerate investments in infrastructure and agriculture, building resilience, strengthening partnerships for growth through investments, enhancing technological innovation, managing natural wealth, nurturing leadership, and creating strategies to enhance jobs and skills, among many other pertinent topics. Special sessions by leaders and development experts including the Cape Verde President Emeritus Pedro Pires, Governor of the Central Bank of Nigeria Sanusi Lamido Sanus, Founder and Group Chief Executive of the Abraaj Group Arif Naqvi, Professor Calestous Juma and Mo Ibrahim promise a rich offering of perspectives and insights on delivering Africa’s promise to her citizens.

I will be participating at the Forum and I am privileged to be the Rapporteur of one of the key plenary sessions, “Mapping the African Growth Landscape,” scheduled for May 9. This session will feature African cabinet ministers, business leaders and international policy experts. After the session, I will record a video that will be posted as part of the WEF’s Insight Reporting.

In addition to the public events, I am looking forward to participating in a session on the role of African think tanks in policymaking. This important session will seek to expound on how African think tanks can better support policymaking in finding solutions to the challenges that the continent faces.

Follow me on Twitter @mwangikimenyi as I provide insights from Cape Town.

Authors

Mwangi S. Kimenyi

Brookings: Topics - Metropolitan Areas

Confronting Suburban Poverty in America - Release Event

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Widening the Panama Canal and the Future of Global Trade Mapping

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A Theoretical Framework for Kenya's Central Bank Macroeconometric Model

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The African Union Can Do More to Support Regional Integration

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Mapping the African Growth Landscape

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Iran’s Presidential Election Puts Populism to the Test

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GCI Houston: Greater Houston and the Next Economy

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Going Global: Greater Houston’s Economic Future

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Strengthening U.S. Manufacturing, Region by Region

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This Week in Immigration

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Six Major Decision Points for Uhuru Administration

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Minority Turnout Determined the 2012 Election

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H-1B Visas and the STEM Shortage

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It Takes Two: Immigration and the Rule of Law

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This Week in Immigration: Senate Markup

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Displacement and Migration Policies: Exploring the Interconnections

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World Economic Forum on Africa: Delivering Africa’s Promise

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