This report is based on two case studies carried out in Brazil and India on the impact of various strategies to reduce the cost of trade for small-scale producers. Small scale producers especially those located in lagging regions in developing countries lack easy access to efficient logistics services. They are faced with long distances from both domestic and international markets. Unless the enterprises are able to consolidate traffic volumes they can be excluded from international supply chains. However, the process of consolidation is not without cost nor does it occur on its own accord. It is typically handled by outside parties in the form of intermediaries. The study was designed around the horizontal relationships between the small scale producers and their vertical connections to higher tier parties involved in the same supply chain. It analyzes the cooperative approach to linking producers, the role of itinerant traders, and a newer and innovative approach to the same problem through virtual integration of farmers using modern information communication technologies. These approaches were explored by studying two separate supply chains...

Market access has been identified as one of the foremost factors influencing the performance of small-scale producers in developing countries, and in particular least-developed countries. Smallholder access to markets for higher-value or differentiated agricultural and food products (hereafter HVAF) is recognized as a vital opportunity to enhance and diversify the livelihoods of lower-income farm households and reduce rural poverty more generally (World Bank 2007a). Smallholder participation in HVAF markets is typically constrained by inadequate farm-level resources, farm-to-market logistical bottlenecks, and more general transaction costs in matching and aggregating dispersed supplies to meet buyer and consumer demand. These traditional constraints have been amplified and, in some cases, surpassed by a new set of challenges associated with compliance with product and process standards, set and enforced by governments as well as private supply-chain leaders. In the face of emerging challenges and opportunities associated with standards and serving HVAF markets...

Recent evidence suggests that increasing overall service coverage and promoting access to telecommunications services have a high economic benefit. Overall, it is estimated that a ten percent increase in mobile telephony penetration could increase economic growth by 0.81 percent in developing countries, whereas a ten percent increase in broadband penetration could increase economic growth by 1.4 percent. In rural and low-income areas in particular, not only do basic telephony services and broadband access allow population to connect with relatives and friends, but they have also introduced a dramatic increase in productivity and in many cases have become the only way for small and medium enterprises in rural areas to access national and, in some cases, global markets. Moreover, the impact of access to telecommunications in rural areas on health, education, disaster management, and local governments has allowed better and more rapid responses, improved coordination, and more effective public management. It is therefore worthwhile to take a second look at all possible policy options...

This report studies the impact that gender differences in Bangladesh have on access to energy and energy services and the consequences of these impacts based on review of recent literature on the matter. The report concludes that the structural gender differences that arise from cultural and religious norms can lead to various impacts in access to energy services which in turn can have long term consequences on women and all these factors must be considered while designing rural energy- gender projects.

In the developing world, poor rural women and their children spend considerable time collecting water. Do women living in areas where more time is needed for water collection tend to participate less in income-earning, market-based activities? Do the education outcomes of their children tend to be worse? This note uses micro-data for eight developing countries to examine these questions. Better access to water is not found to be associated with greater off-farm paid work for women, but is associated with less unpaid work. In countries where substantial gender gaps in schooling exist, enrollment for both boys and girls tends to be higher.

This study examines the major constraints of rural business entry and performance in Yemen. The Yemen rural investment climate survey made it possible to analyze rural investment climate constraints for rural businesses. The survey was used to investigate both farm and nonfarm rural enterprises. The rural investment climate was assessed using a combination of subjective impressions related by rural entrepreneurs, and a more objective, empirical set of analyses that employed indicators to rank the constraints to "doing business" in the areas surveyed. These empirical analyses included application of the entry model, the performance model, the closure model, and the migration model. The migration model was introduced to identify how the rural investment climate variables at the community level increase migration and economic activities. Based on the assessment of the rural investment climate, this paper identifies and explains four critical areas in which the rural investment climate in Yemen can be improved: market demand...

Financial Access 2009 introduces the latest data from a survey of financial regulators in 139 countries. It presents indicators of access to savings, credit, and payment services in banks, and in regulated nonbank financial institutions. It is intended for a broad audience of policymakers, researchers, practitioners, multilateral and bilateral investors, in order to guide monetary policy, monitor systemic risks, and collect information on the values of deposits and credit. This report reviews three interventions: disclosure requirements, interest rate caps, and methods to address excessive lending that can result in consumer indebtedness. Improved transparency and disclosure allow borrowers to make informed choices and can facilitate competition in financial markets, eventually leading to lower prices and improved products. Policies to restrict interest rates or credit quantity, especially in consumer credit, seem to have limited effect but require further analysis.

This article reviews the evidence on the importance of finance for economic well-being. It provides data on the use of basic financial services by households and firms across a sample of countries, assesses the desirability of universal access, and provides an overview of the macroeconomic, legal, and regulatory obstacles to access. Despite the benefits of finance, the data show that use of financial services is far from universal in many countries, especially developing countries. Universal access to financial services has not been a public policy objective in most countries and would likely be difficult to achieve. Countries can, however, facilitate access to financial services by strengthening institutional infrastructure, liberalizing markets and facilitating greater competition, and encouraging innovative use of know-how and technology. Government interventions to directly broaden access to finance, however, are costly and fraught with risks, among others the risk of missing the targeted groups. The article concludes with recommendations for global actions aimed at improving data on access and use and suggestions on areas of further analysis to identify constraints to broadening access.

The ongoing global economic turmoil is seriously impeding client countries access to capital markets, with relatively little regard for the fundamentals of the countries involved. Growing risk aversion among investors has triggered a flight-to-quality that is affecting all but the safest assets (AAA-rated). Small, open, and developing economies in Europe and Central Asia, including FYR Macedonia, are being exceptionally hurt. Despite its history of prudent macroeconomic policies and progress on structural reforms, FYR Macedonia s access to capital markets has been virtually closed or available only on very unfavorable terms. Policy-Based Guarantees (PBG) help well-performing clients with a track record of macro stability and structural reforms mitigate market access risks while advancing a country s development policy dialogue. PBGs also have the added benefit of catalyzing private capital flows by alleviating critical risks. The PBG extended by the World Bank to FYR Macedonia ensured the country s access to markets in a virtually closed market environment and at highly competitive terms.

Reliable and affordable supply of electricity is a key driver of economic growth. In recent decades, many developing and emerging economies have embarked on efforts to enhance the efficiency of their electricity markets. The quest for efficiency often involves structural reforms such as unbundling and other measures designed to support greater competition in the power sector. Open Access (OA) to Transmission and Distribution (T&D) grids by market participants is an essential element in this reform process. The study has proceeded on two tracks: one based on empirical findings from specific country cases, and a generic one synthesizing the emerging global issues in OA. Reports for the country studies have been prepared for Brazil, Peru, Turkey, India, and the Philippines. In addition, a global review of the experience in a broader group of countries, both developed and developing, has been undertaken. Overall, the study has taken a broad approach to defining OA - going well beyond the minimalist notion of simply guaranteeing legal access to the grid for generators and wholesale buyers.

Linking farmers to markets is widely viewed as a milestone towards promoting economic growth and poverty reduction. However, market and institutional imperfections along the supply chain thwart perfect vertical and spatial price transmission and prevent farmers and market actors from getting access to information, identifying business opportunities and allocating their resources efficiently. This acts as a barrier to market-led rural development and poverty reduction. This paper reviews and analyses household information, and the major livestock market and marketing data available in Tanzania, in relation to market-led development possibilities. Household-level data collected by the Tanzania National Bureau of Statistics and market data collected and disseminated by the Livestock Information and Knowledge System of the Tanzania Ministry of Industry and Trade are reviewed and utilized together. Both types of data help identify market opportunities for livestock producers, but only their joint use could provide policy makers with the information needed to design and implement policies that facilitate access to markets for livestock producers. Options to promote integration of household-level data and market data are discussed...

The percentage of smallholders with access to finance is equally difficult to quantify. According to estimates, even promising approaches to expanding smallholder lending, such as value chain finance, are reaching fewer than 10 percent of smallholders, primarily those in well-established value chains dedicated to higher value cash crops. International Finance Corporation (IFC) has been engaged for several years in learning efforts through diverse partnerships to obtain insights into the challenges of agricultural finance. The evidence of microfinance institution (MFI) involvement in financing commercial and semi-commercial smallholders remains anecdotal and lacks specifics on what makes MFI lending to these segments feasible, and what restricts their reach and effectiveness. This IFC study aims to identify and disseminate lessons emerging from the work of MFIs that have implemented agricultural operations targeting agricultural smallholders in Latin America and the Caribbean (LAC) to support replication and expansion of scalable approaches. Through this research...

This paper investigates how internal migration is affected by Brazil’s increased integration into the world economy. It analyzes the impact of regional differences in access to foreign demand on sector-specific bilateral migration rates between the Brazilian states for the years 1995 to 2003. Using international trade data, a foreign market access measure is computed at the sectoral level, which is exogenous to domestic migration. A higher foreign market access is associated with a higher local labor demand and attracts workers via two potential channels: higher wages and new job opportunities. Results show that both channels play a significant role in internal migration. Further, we find a heterogeneous impact across industries, according to their comparative advantage on the world market. However, the observed impact is driven by the strong reaction of low-educated workers to changes in market access. This finding is consistent with the fact that Brazil is exporting mainly goods that are intensive in unskilled labor.

This paper sheds new light on the agricultural side of the Italian regional divide from an economic geography perspective, following a Von Thünen approach. The central hypothesis is that the development of the non-agricultural economy in Northern cities drove the location of agricultural output and inputs during the interwar years. A new database on Italian agriculture around 1930 fully confirms the key role of access to domestic markets in shaping agricultural activity. Thus, the causes of the falling behind of Southern agriculture are uncovered: it is not very surprising that an agricultural divergence joined an already ongoing industrial divergence during a period in which international markets collapsed.; Support is acknowledged from the Spanish Ministry of Science and Innovation project HAR2010-20684- C02-01.

Using a new and representative data set of Chinese household finance, this paper documents household access to and costs of finance, along with their correlates. As in most developing countries, informal finance is a crucial element of household finance, and wealth tends to be associated with better access to formal and informal finance. Better financial knowledge shifts loan portfolios toward formal sources relative to informal ones. Connections to the Communist Party are associated with significantly better access to finance in rural areas but not in urban areas. A larger social network is positively associated with access to informal finance. Controlling for household characteristics, rural residents pay interest rates on loans similar to urban residents. Younger residents pay higher rates, while households on firmer economic footing face lower rates. Taking financial classes and college education is associated with higher interest rates for urban residents, suggesting perhaps that financial knowledge coincides with greater demand for credit in areas with more economic opportunity. Overall...

Combining multi-year, firm-level surveys with country-level panel data for 53 countries, the authors explore the impact of bank competition on firms' access to finance. They find that low competition, as measured by high values of the Lerner index, diminishes firms' access to finance, while commonly-used bank concentration measures are not robust predictors of firms' access to finance. In addition, they find that the impact of competition on access to finance depends on the environment that banks operate in. Some features of the environment, such as greater financial development and better credit information, can mitigate the damaging impact of low competition. But other characteristics, such as high government bank ownership, can exacerbate the negative effect.

Women and men use rural and urban transport for different purposes based on their socially determined roles and responsibilities. Poor rural transport systems limit access to markets, education, and health services for all, but even more so for women and girls. Female mobility is often constrained by heavy domestic work-loads and time spent traveling by foot, carrying heavy loads over rough trails. Time poverty combines with cultural restrictions to limit women's and girls' economic, educational opportunities and participation in community decision-making, particularly for ethnic minority women in remote mountainous areas. Gender differences in mobility and access are also affected by ability to pay for transport services. Most women have more limited access to financial and other resources, and inadequate voice in local level transport priority setting than men. Gender and Transport capacity building needs to be grounded in practical, on-the ground country realities in the transport sector and draw on the experience of transport specialists who have addressed gender in their work or clearly understand the entry points. Participatory gender and transport capacity building that provides opportunities for applying what is learned to transport problems is more effective than a lecture format.

Poor rural women in the developing world spend considerable time collecting water. How then do they respond to improved access to water infrastructure? Does it increase their participation in income earning market-based activities? Does it improve the health and education outcomes of their children? To help address these questions, a new approach for dealing with the endogeneity of infrastructure placement in cross-sectional surveys is proposed and implemented using data for nine developing countries. The paper does not find that access to water comes with greater off-farm work for women, although in countries where substantial gender gaps in schooling exist, both boys' and girls' enrollments improve with better access to water. There are also some signs of impacts on child health as measured by anthropometric z-scores.

Despite positive, relatively broad-based and stable growth record in recent years and immense untapped potential in agriculture, mining and services, Zambia's poverty rates have not declined significantly and remain high. Income growth is limited by coordination failures such as poor access to domestic and international markets, inputs, extension services and information. High indirect costs - most of which attributable to infrastructure service-related inputs into production including energy, transport, telecom, water, but also insurance, marketing and professional service - undermine Zambia's competitiveness limit job creation and therefore serve as a major constraint to pro-poor growth. Continued real appreciation is another serious threat to the competitiveness of export-oriented and import-competing sectors and to job creation. For Zambia to stay competitive and sustain the growth momentum it will be critical to improve productivity - including the productivity of its labor force, and to lower indirect production costs related to basic services. Carefully crafted monetary and fiscal policies will also be critical in responding to the real appreciation pressures. Improving the quality and access to secondary and tertiary education is essential if the poor are to benefit from future growth of the non-farm economy. Weak governance and in particular poor government effectiveness...

Recent economic and political developments have highlighted a challenge shared across the Arab region of generating employment, promoting inclusive growth, and improving competitiveness. In the short run, weakened macroeconomic fundamentals in the developing economies of the Middle East and North Africa are a key challenge. The region's main challenge is to achieve sustainable growth that delivers the quantity and quality of jobs needed. An inclusive and competitive private sector has proven to be one of the most effective and long-term solutions for this challenge. This paper provides an analytical framework to diagnose and identify key challenges to the growth of small and medium enterprises that is supported by a quantitative model based on the World Bank's Enterprise Surveys database. The findings reconfirm that the route to a sustained role for small and medium enterprises in job creation requires improving the credibility of reforms, the effectiveness of policies, and equitable enforcement. Although one size fits all is infeasible for Arab countries...