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“DELIVER AFRICA FROM DEBTS”: Good Governance Alone is not Enough to Save the Continent From Debt Onslaught

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  • Abel Kinyondo
  • Riccardo Pelizzo
  • Mwoya Byaro

Abstract

The present article analyzes the debt–economic growth nexus in African countries while controlling for the impact of good governance indicators. In contrast to a long tradition of scholarship that has consistently suggested that government debt has a detrimental impact on economic growth in sub‐Saharan Africa, recent studies have actually shown that government debt, when coupled with improvements in the quality of government, is actually a driver of economic growth. By analyzing an original dataset that covers the 2002–15 period and additional debt–economic growth data going up to the year 2020, we are able to suggest three conclusions. First, in the absence of debt, good governance matters in improving economic growth. Second, some dimensions of governance are better predictors of economic performance than others—as the “good enough governance” literature has in recent years suggested. Third, under no circumstances is debt government growth beneficial for the economic performance of African countries. Building on this evidence, we suggest that the COVID‐19 pandemic—which has already slowed down African economies and increased their debt exposure—may prevent African countries from making greater progress along the developmental path. El propósito del presente artículo es analizar el nexo deuda‐crecimiento económico en los países africanos controlando el impacto de los indicadores de buena gobernanza. En contraste con una larga tradición académica que ha sugerido sistemáticamente que la deuda pública tiene un impacto perjudicial sobre el crecimiento económico en África subsahariana, estudios recientes han demostrado que la deuda pública, cuando se combina con mejoras en la calidad del gobierno, es en realidad un motor de crecimiento económico. Al analizar un conjunto de datos original que cubre el período 2002–15 y datos adicionales de crecimiento económico de la deuda hasta el año 2020, podemos sugerir tres conclusiones. Primero, en ausencia de deuda, la buena gobernanza es importante para mejorar el crecimiento económico. En segundo lugar, algunas dimensiones de la gobernanza son mejores predictores del desempeño económico que otras, como ha sugerido la bibliografía suficientemente buena sobre gobernanza en los últimos años. En tercer lugar, bajo ninguna circunstancia, el crecimiento del gobierno de la deuda es beneficioso para el desempeño económico de los países africanos. Basándonos en esta evidencia, sugerimos que la pandemia de COVID‐19, que ya ha desacelerado las economías africanas y aumentado su exposición a la deuda, puede impedir que los países africanos logren un mayor progreso en la senda del desarrollo. 本文目的是在控制善治指标影响的同时分析非洲国家的债务‐经济增长关系○ 长期以来, 学术文献一致暗示政府债务对撒哈拉以南非洲的经济增长产生了消极影响, 与此相反的是, 近期研究显示, 当治理质量提升时政府债务实际能驱动经济增长○ 通过分析一项涵盖2002–15年的原始数据集, 以及一项包含2002–20年的债务‐经济增长数据, 我们提出了三个结论○ 第一, 在没有债务的情况下, 善治在提高经济增长一事中发挥重要作用○ 第二, 治理的某些维度比其他维度更能预测经济表现—近年来相当多的治理文献也得出了这一观点○ 第三, 政府债务增长在任何情况下都不会有益于非洲国家的经济表现○ 基于此, 我们暗示, 已经减缓非洲经济并增加其债务风险的新冠肺炎(COVID‐19)大流行可能会阻碍非洲国家在发展道路上走得更远○

Suggested Citation

  • Abel Kinyondo & Riccardo Pelizzo & Mwoya Byaro, 2021. "“DELIVER AFRICA FROM DEBTS”: Good Governance Alone is not Enough to Save the Continent From Debt Onslaught," World Affairs, John Wiley & Sons, vol. 184(3), pages 318-338, September.
  • Handle: RePEc:wly:woraff:v:184:y:2021:i:3:p:318-338
    DOI: 10.1177/00438200211025519
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