The fiscal dimension of HIV/AIDS in Botswana, South Africa, Swaziland, and Uganda

HIV/AIDS imposes enormous economic, social, health, and human costs and will continue to do so for the foreseeable future. The challenge is particularly acute in Sub-Saharan Africa, home to two-thirds (22.5 million) of the people living with HIV/AIDS globally, and where HIV/AIDS has become the leading cause of premature death. But now, after decades of misery and frustration with the disease, there are signs of hope. HIV prevalence rates in Africa are stabilizing. This book sheds light on these concerns by analyzing the fiscal implications of HIV/AIDS in Southern Africa, the epicenter of the epidemic. It uses the toolbox of public finance to assess the sustainability of HIV/AIDS programs.

Importantly, it highlights the long-term nature of the fiscal commitments implied by HIV/AIDS programs, and explicitly discusses the link between HIV infections and the resulting commitments of fiscal resources. The analysis shows that, absent adjustments to policies, treatment is not sustainable. But it also shows that, by accompanying treatment with prevention, and making existing programs more cost-effective, these countries can manage both treatment and fiscal sustainability. Even in countries where HIV/AIDS-related spending is high or increasing (as past infections translate into an increasing demand for treatment), the fiscal space absorbed by the costs of HIV/AIDS-related services will decline if progress in containing and rolling back the number of new infections can be sustained. The purpose of this study is to refine the analysis of the fiscal burden of HIV/AIDS on national governments and assess the fiscal risks associated with scaling-up national HIV/AIDS responses.

The study complements and contributes to the agenda on identifying and creating fiscal space for HIV/AIDS and other development expenditures. The findings from this study, and the analytical tools developed in it, could help governments in defining policy objectives, improving fiscal planning, and conducting their dialogue with donor agencies.

World Bank.Author:  Lule, Elizabeth ; Haacker, Markus.Document Date:  2011/01/01.Document Type:Publication.Report Number:65658.Volume No: 1 of 1

The fiscal dimension of HIV/AIDS in Botswana, South Africa, Swaziland, and Ugandan

South Africa.Eskom Investment Support Project

The project development objective (PDO) of the Eskom Investment Support Project for South Africa is to enhance its power supply and energy security in an efficient and sustainable manner so as to support both economic growth objectives and South Africa's long term carbon mitigation strategy.

World Bank.Author:  Duncan,Reynold.Document Date:  2011/12/01.Document Type:  Implementation Status and Results Report.Report Number:  ISR4935

South Africa - Eskom Investment Support Project : P116410 - Implementation Status Results Report : Sequence 03a

South Africa’s Pursuit of Green Economy Offers Major Economic and Environmental Benefits

World Bank.News Release No:2012/161/AFR. Johannesburg, November 22, 2011– The pursuit of green policies can have major direct environmental and economic benefits for South Africa, but the costs of transition to a green economy  should be carefully weighed against the benefits argues a new World Bank report released today.

 

The report, written against the backdrop of slowing global economic prospects  shows how the South African economy, with its close links to the world economy, has suffered, leading to a lower 2011 GDP forecast of 3.2 percent, down from the 3.5 percent projected in an earlier update.  For 2012 and 2013, the report forecasts  3.1 and 3.7 percent growth rate respectively, down from the 4.1 and 4.4 percent of the earlier report released in July 2011.

“The report finds that green policies can also have significant co-benefits with growth and jobs but these are not automatic and need to be backed by complementary reforms” said Ruth Kagia, World Bank Country Director for South Africa.  “However, green policies are not a ‘silver bullet,’ and they cannot be a substitute for pro-growth, job-boosting policies just as fast growth cannot replace the need for well-designed environmental policies.”

The policy objectives of pursuing a greener economy and green growth are laudable and there are strong economic and environmental benefits to be reaped. However, such policy reforms invariably involve costs and tradeoffs.  The report takes a hard look at the entire spectrum of green economy issues and offers fresh insights with a view to informing policymaking for broad-based growth and sustained poverty reduction.

“Green growth means fostering economic growth and development,while protecting natural assets,” said Milan Brahmbhatt and Michael Toman, World Bank Senior Advisor and Research Manager respectively, co-authors of the report. “But natural capital is nearly always overused because it lacks a price that reflects the social cost of depletion due to market or policy failures. Rectifying such failures is key to securing long-term sustainability of the resource base and people’s well-being.”

The report recommends that policymakers make choices in ways that fully reflect social costs and benefits of natural capital.  Faster growth needs to be accompanied by stronger environmental protection.

The report cautions that there is no single policy lever that by itself will deliver both growth and environmental protection.  There are important synergies to be derived between growth and the environment and that these are likely larger when growth and environment policies are well coordinated. 

In Pretoria:
Sarwat Hussain shussain@worldbank.org
Tel: +27 12 742 3124

Mmenyane Seoposengwemseoposengwe@worldbank.org
Tel: 073 888 4598

In Washington:
Aby K. Toure
Tel: (202) 473-8302akonate@worldbank.org

The impact of export tax incentives on export performance : evidence from the automotive sector in South Africa

The original goal of the Motor Industry Development Program was to help the automotive industry in South Africa adjust to trade liberalization and become internationally competitive. In simple terms, it consists of an import/export complementation arrangement, whereby the local value-added of components or built-up vehicles exported earns credits that can be used to rebate import duties on components and vehicles.

This study provides a first attempt at a quantitative analysis of the Motor Industry Development Program using the difference-in-difference methodology, in order to assess to what extent the program was effective in improving South Africa's automotive export performance during 1996-2006. The authors take a two-tier approach. First, they perform a comparative study using different manufacturing sectors within South Africa; second, they apply this methodology to analyze South Africa and a number of comparator countries that are automotive producers and exporters. The analysis finds that the impact of the program on automotive exports in South Africa is positive and significant.

In particular, (i) the largest response to the program in terms of improved manufacturing exports occurs with a delay after the adoption of the law, suggesting that exports need time to fully react to the incentives; and (ii) in turn, the effectiveness of the tax incentives fades in time, reaffirming the common belief that tax incentives may affect some business decisions particularly in the short run, but they are not a primary consideration for investors in the long run

Author: Madani,Dorsati H.; Mas-Guix,Natalia;Document Date: 2011/03/01.Document Type:Policy Research Working Paper.Report Number:WPS5585.Volume No: 1 of 1. Collection Title: Policy Research working paper ; no. WPS 5585

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