The Finance for Development Lab and the Paris School of Economics hosted the 7th edition of the Interdisciplinary Sovereign Debt Research and Management Conference (#DebtCon7), from May 29 to 31, 2024, at the Paris School of Economics. 

The conference brought together scholars, civil society representatives, and practitioners from the public and private sectors who work on sovereign debt, to help find creative solutions for urgent debt policy challenges.

Day one of the conference provided a platform for African think tanks to discuss new and emerging solutions to countries indebtedness.  CSEA’s Senior Research Fellow, Mma Amara Ekeruche, presented the Centre’s plan for a newly commissioned study on Debt Sustainability Analysis (DSA).

The study aims to improve the mechanisms of the current Lower-Income Countries’ Debt Sustainability Framework (LIC-DSF) andDebt Sustainability Analysis for Market-Access Countries (MAC DSA), by undertaking a historical examination of DSAs since 2005 and leveraging on insights from country officials. The overall outcome is to provide an alternative to the existing DSA framework.

Here are eight key takeaways from her participation in the conference:
1.        Bad fiscal policy is not the only reason for the rising indebtedness, the balance sheet effects of currency depreciations are also a key driver particularly in the context of high external loans.
2.        Improvements in restructuring whether nominal haircut restructuring or reprofiling is possible by adopting Collective Action Clauses (CACs) and/or engaging in Debt for Nature Swaps particularly before the high yielding debt becomes excessive. However, CACs cannot be integrated into some forms of loans such as syndicated loans and quasi debt. In such cases, legal reforms should be proposed and the best places to begin are countries that are well integrated into the international trade and financial systems.
3.        On climate-smart debt management, solutions include: (i) Climate-resilient clauses in official and commercial loans (ii) Catastrophe-Deferred Drawdown Options (CAT-DDO’s) (iii) Catastrophe bonds and (iv) KPI bonds whose interest rates reduce once emission targets are met.
4.        Issues with “new” innovations. State-Contingent Debt Instruments (SCDI) are value recovery instruments – creditors get higher yields when the state variable (e.g., oil price, GDP growth) improves. However, SCDIs have very low liquidity, are traded at low prices, and in most cases, their valuation is not backed by science. Another issue with new inventions is the proliferation of climate funds – there are now 70 of them!
5.      Debt gone wrong: Congo vs Commisimpex- Here, Congo took on an oil-backed supplier credit in 1986 and did not fulfil its debt obligations. Fast forward to nearly 4 decades after, the debt obligation has morphed into 675 million Euros and the International Court of Arbitration has mandated that Congo makes the payment.
6.     The European Bank for Reconstruction and Development (EBRD) is expanding its portfolio to emerging markets including Nigeria and a few other African countries. Their main aim is to lend to SMEs through African financial institutions.
7.     Debt is now being considered as “investment” by some courts which makes it possible for creditors to collect debt claims by leveraging on investment treaties.
8.  Trade is the most likely solution to the reoccurring debt problem in many African countries as exemplified by Mexico with North American Free Trade Agreement (NAFTA).

Tobacco smoking is a significant risk factor for noncommunicable diseases such as chronic respiratory disorders, cancer, diabetes, and heart disease and the leading cause of preventable deaths worldwide. Current estimates indicate that cigarettes alone are responsible for 8.7 million deaths annually, and 7.7 million of these fatalities are attributable to smoking, whereas 1.3 million are the consequence of secondhand smoke exposure among nonsmokers. Studies also reveal that many individuals begin smoking before the age of 18 as a result of  the tobacco industry frequently targeting youth in low-income countries with its marketing efforts (WHO report).  

CSEA, in its capacity as a sustainability partner  of the Tobacco Control Data Initiative (TCDI 2.0) established by Development Gateway, has compiled a factsheet commemorating World No Tobacco Day 2024. This document highlights facts about tobacco prevalence amongst children and the tobacco industry's interference in countries —Nigeria, South Africa, Kenya, the Democratic Republic of the Congo, Ethiopia, and Zambia

Afro beats have grown in popularity, both locally and globally, during the last decade. Its success extends beyond music, to the film and fashion industries. The widespread availability of internet access has given rise to a subgroup known as skit makers and influencers. Currently, the Nigerian entertainment sector has the second-largest position worldwide, after Hollywood (International Trade Administration, 2023). According to a report by PwC, this industry is expected to generate a revenue of USD 12.9 billion in sales by 2027, emphasising its huge untapped potential, primarily driven by the private sector.

According to the CBN statistical bulletin,  the arts and entertainment industry contributed no less than 0.20% from 2016 to 2021. However, in 2020, the industry growth rate fell to a record low of  -3%. In 2021, there was a substantial rebound, with a growth rate of 1.72%, suggesting an improvement in the sector's performance over the previous year. The downturn was mostly driven by the pandemic, which had an impact on industries all across the world. Hollywood, for example, suffered a $7 billion loss as a result of the pandemic. Despite these limitations, COVID-19 created a new revenue source through skits and reels, with local content creators building   sizable online followings during the pandemic.

Based on estimates from the United Nations Educational and Scientific Organisation (UNESCO) the creative economy generates $2.25 trillion in yearly income and contributes 30 million jobs globally, demonstrating  the vast economic prospects that await exploration. Nigeria is  in a unique position to effectively integrate its entertainment industry into the global creative economy, establishing itself as a key player in the international market. 

Despite the industry opportunities and potential for job creation, it is still hampered by several  challenges, including substandard technology and filmmaking equipment, copyright infringements, and piracy which impede potential investments, as well as limited access to funds and a lack of robust Foreign Direct Investments (FDI). The lack of a   well-defined industry structure as well as insufficient project development and business planning impede the sector’s ability to reach its full potential. 

To overcome  these challenges and increase the industry's contribution to the country's GDP, the Federal government can take strategic actions in the following ways:

1. Investment in Arts and Entertainment:

The Federal government should invest in infrastructure and training to encourage the expansion of the entertainment industry. This includes building and maintaining cutting-edge studios and production facilities, as well as  executing training programmes aimed at improving   the skills and knowledge of experts in the field. 

2. Access to Funding:

Allow for easier access to funding for both new and existing participant players in the entertainment industry. This can be achieved through government grants, partnerships with financial institutions, and the creation of investment incentives. 

3. Awareness and Enforcement of Intellectual Property Protection:

Nigerians intending to navigate the entertainment industry must be educated on intellectual property to maximise their opportunities and avoid copyright infringement and unauthorised use of their content. The government must strengthen intellectual property regulations to prevent copyright infringements and piracy. A safe intellectual property environment will encourage both local and foreign investment while also protecting the rights of content creators. 

4. Establish a collaborative Industry Task Force:

Establishing an industry task force comprising industry experts, government representatives, and key stakeholders. This task force will evaluate the current state of the sector and develop a strategic plan, working together to define and implement industry standards, guidelines, and best practices. This coordinated effort will strive to establish an organised and standard framework for operations, ensuring a comprehensive approach to industry development.

This blog was written by Ditep Nantep Rejoice, Research Intern at CSEA.

Irrespective of a country’s level of development, public procurement plays a pivotal role in shaping the efficacy of public service delivery and fostering a conducive environment for inclusive growth. In the Nigerian context, deficiencies in public procurement have contributed in part to a poor level of governance and weak state capacity. This is due to the leakages, inefficiencies, and corruption that characterize government procurement. Although quantifying the scale of loss due to inadequate procurement process is challenging, Nigeria’s anti-corruption agency estimates contract and procurement fraud at approximately 2.9 trillion naira ($7.6 billion) over the period 2018 to 2020, which stood at a staggering 10% of the total budgetary allocations for that period.

This Commentary was first published by the Brookings Institution. READ MORE

One of the global causes of death is cancer. It is estimated that approximately 10 million people die of cancer annually. Notably, one out of every six deaths worldwide is attributable to cancer, making it the leading cause of mortality on a global scale. In Nigeria, the annual death toll from cancer is around 72,000. The prevalence of cancer is higher among women than men. More specifically, cancer kills approximately 40,647 women and 30,924 men annually (IARC, 2022). 

Cancer is attributed to a wide range of factors, including but not limited to unhealthy dietary choices, consumption of canned foods, genetic predisposition, and inadequate hygiene. Consequently, a broad spectrum of cancers exists, including breast cancer, lung cancer, cardiovascular cancer, cervical cancer, bladder cancer, and brain cancer, among others. High prevalence of tobacco smoking is a major cause of cancer attributed disease.  According to research conducted by a UK-based cancer research centre, approximately 33% of cancer cases are directly attributable to tobacco smoking or usage, either through direct smoking or exposure to second-hand smoke. Lung cancer, primarily linked to smoking, is the most common cause of cancer-induced death. Moreso, smoking among pregnant women results in an increased risk of miscarriage, low birth weight, and sudden infant syndrome. 

Cancer has been identified as a serious threat, and significant global efforts have been geared towards its prevention and treatment. As we mark this year's Cancer Day, themed "Close the Care Gap," it is imperative to examine the link between tobacco use and the global prevalence of cancer, with a particular focus on Nigeria.

Over time, extensive studies have shown how tobacco consumption leads to various types of cancer, notably lung cancer. Smoking cigarettes damages the cell's DNA, which controls the function of the body, leading to weakness in some organs in the body and, ultimately, the development of a cancer tumour. To reduce the rate of smoking and, by extension, the deaths related to tobacco use, the government, in collaboration with other international development partners, has made significant efforts to regulate tobacco use in Nigeria. 

The effort dates back to the 1950s. Even though there is a presence of industrial interference, Nigeria has made significant progress in tobacco control efforts. This includes passing the National Tobacco Control Bill in 2015 and implementing policies restricting tobacco advertising, promoting, and sponsoring; creating smoke-free areas; increasing tobacco product taxes; and managing industry interference. These initiatives align with the WHO MPOWER Framework, although the country has not fully met the threshold recommended. 

Individuals grappling with tobacco-induced cancer often find themselves in vulnerable situations, predominantly characterised by economic hardship. Many of these people belong to the socio-economically disadvantaged strata of society, lacking the financial means to adequately care for themselves. Furthermore, a significant portion of this population may not have received adequate education to learn about living a healthy lifestyle while dealing with cancer. These issues are further aggravated by the inadequate healthcare infrastructure in some regions, making early cancer detection difficult. As a result, the disease may progress to a critical stage before being diagnosed. Additionally, individuals in this situation often confront psychological issues, including neglect by family members, social discrimination, ethnic origins, age, gender, and overall lifestyle.

Strategies to Close the Care Gap

Given the challenges experienced by people affected by tobacco-induced ailments, it is imperative to enhance the enforcement of the MPOWER framework. Specifically, the ‘O’ in the framework depicts the importance of offering help and care. Achieving this requires the concerted efforts of governments, civil society, and development partners. Public awareness initiatives and widespread campaigns to educate the public on the dangers of tobacco use and promote available support for those seeking help to quit are essential.  In addition, offering help involves promoting access to smoking cessation services, including counselling and nicotine replacement therapies, to support individuals in their journey to quit. 

Furthermore, studies have shown that health workers often blame patients for their predicaments; this often leads to delayed diagnosis of disease. Therefore, fostering empathetic communication is essential. Education initiatives can improve healthcare workers’ understanding of addiction challenges, thereby promoting cultural sensitivity to prevent making assumptions. Encouraging smoking cessation services, incorporating behavioural health support, and adopting patient-centred care all contribute to a holistic approach. Continuous professional development ensures healthcare workers stay informed while creating a supportive environment that builds trust. By adopting these strategies, healthcare workers can provide care while promoting a compassionate and effective approach to tobacco control.

The role of family and friends in supporting individuals with tobacco-related illnesses cannot be overemphasised. Providing emotional support and empathy helps create a positive environment for the individual. Encouraging them to seek professional help and participate in cessation programmes can help them quit tobacco use. Family and friends can communicate openly and non-judgmentally, building trust and support. Active participation in smoking cessation activities, such as attending counselling sessions or joining support groups, demonstrates a shared commitment to overcoming the challenges of tobacco addiction. Offering encouragement, celebrating milestones, and reinforcing healthier lifestyle choices contribute to a comprehensive support system for individuals who want to quit tobacco and avoid tobacco-related diseases.

In conclusion, tackling cancer issues and bridging the care gap requires a collaborative and holistic approach. Given that tobacco smoking is a major cause of cancer, effective implementation of the MPOWER framework, particularly in terms of providing assistance, necessitates coordinated efforts from government, civil societies, and development partners. These collective strategies would go a long way towards providing a supportive environment, encouraging healthy lifestyle choices, and preventing tobacco-related diseases in our society.