Browsing by Author "Ocran, Matthew"

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    Comparative analysis of financing instruments used by development finance institutions: lessons for Brics Development Bank
    (2014) Ntsaluba, Sango Siviwe; Ocran, Matthew
    Financing instruments are the means by which development finance institutions carry out their mandate of addressing the socio-economic needs of the country, group of countries or a region. It is of great importance that the development and application of financing instruments should be in line with the objectives for which the development finance institutions were established. The literature reviewed was intended to establish the reasons for the existence of development finance institutions and their role in private sector development. Furthermore, literature was reviewed to establish various financing instruments developed and applied by development finance institutions. The study is premised on the fact that new DFIs can be complementary thus an assessment of DFIs will provide instrument and sectoral gaps which the BRCIS Bank can take advantage of. As such, the study was to examine the financing instruments that development finance institutions (DFIs) use to address their economic objectives and identify lessons for the BRICS (Brazil, Russia, India, China and South Africa) Development Bank. The study employed the qualitative exploratory research strategy. Documents and in-depth interviews were used as data. The sample included major multilateral, regional and bilateral development finance institutions operating in developing economies, including BRICS countries. The author established that there are varied founding objectives of development finance institutions and that there is wide use of traditional financing instruments of debt and equity. However, there is limited use of innovative financing instruments such as project finance and those applied in Public Private Partnerships (PPPs). The main recommendation made is that BRICS Bank should take advantage of the existing instrument and sectoral gaps if it is going to survive not only as a competitor but a complementary DFI. In addition it should consider the introduction of innovative instruments that take into account developing and emerging economies realities. In light of mission drift and agency issues the BRICS Bank should have robust governance and monitoring and evaluation frameworks that will ensure that its founding objectives are pursued.
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    The impact of farm input subsidies on economic efficiency of maize production in Malawi
    (2018) Chiromo, John; Alhassan, Abdul Latif; Ocran, Matthew
    The study analyzed the impact of the farm input subsidy programme (FISP) on the technical, allocative and economic efficiency and determining factors associated with these efficiencies of 12, 271 smallholder maize farmers from 2010 IHS3 dataset in Malawi. Descriptive statistics, stochastic frontier approach as and a Cobb-Douglas production function were applied. Yield responsiveness to production inputs was estimated by computing input elasticities. The findings indicate that technical efficiency of smallholder maize farmers ranged from 15.7 to 78.9 with a mean of 61.3 percent reflecting a substantial level of inefficiency. The allocative efficiency scores were between 23.5 and 86.2 with a mean of 66.9 percent reflecting a substantial level of allocative inefficiency. The economic efficiency scores were between 14.1 and 74.6 with amean of 59.2 percent reflecting a substantial economical inefficiency. An estimated return to scale was 0.87 indicating that during the period under review, smallholder maize farming decreased by about 13 percent. The results of second stage Tobit regression estimations indicates that the FISP programme improved the efficiencies of maize farmers in Malawi. In addition, t farmers’ age, farming experience, education years, having an income generating activity and receiving remittance were also identified as significant drivers of production capacity of smallholder farmers maize. However, farmers’ marital status, family size and distance to the market had a negative impact on smallholder farmers’ capacity in maize production. Smallholder farmers in Malawi were experiencing a decreased return to scale meaning that they were technical, allocative and economically inefficient in maize production. From the findings, among other issues to be considered for the improvement of technical, allocative and economic efficiencies of maize production among smallholders farmers, the government should support only energetic farmers, make farm inputs available and accessible to farmers, continued advocacy on v adoption of family planning to reduce population growth to carter for scarcity of resources, increase and enhance extension services to help in educating these smallholder farmers in handling new technologies associated with modern agriculture, encourage them to engage in IGAs to complement FISP in purchasing farm inputs, increased and extended cash transfer program to economically empower these smallholder farmers.
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    Using project bonds to fund South Africa's infrastructure development
    (2016) Sithole, Londa Leon Zinhle; Ocran, Matthew; Biekpe, Nicholas
    The growing use of project bonds in funding infrastructure globally deserves attention. Although primarily dominated by the developed markets, emerging markets such as Latin America and Asia have also been successful in using project bonds to finance their infrastructure projects. The project bond market in South Africa remains insignificant, with only a few episodic issuances in the last decade. Given the size of the country's capital markets, institutional investor base and experience with project finance transactions; one would expect the country to have a sizeable project bond market. This paper aims to investigate whether or not South Africa has the capacity to use project bonds to fund its infrastructure development. As government finances take strain, and as bank funding becomes unavailable due to Basel III, South Africa will need to look to the capital markets for the funding of its ambitious infrastructure plan. This paper finds that South Africa should begin to use project bonds and capital markets to fund its infrastructure development. However, more needs to be done on the regulatory and legal side to ensure that the country continues to attract foreign investment for infrastructure development.