Economics & Development

This statement, delivered by H.E. Reem Alabali Radovan, Federal Minister for Economic Cooperation and Development of Germany, to the 113th Meeting of the Development Committee on April 16, 2026, underscores the central importance of strong multilateralism in addressing an increasingly fragile and complex global environment marked by geopolitical tensions, conflict, economic vulnerabilities, climate change, and rising development needs. It highlights Germany’s commitment to diplomacy, peace, and stability, including support for ceasefire efforts and negotiated solutions to conflicts with far-reaching humanitarian, economic, and energy implications. The statement outlines Germany’s reformed development cooperation framework, focused on ending hunger, poverty, and inequality; promoting peace and stability; fostering sustainable and equitable economic growth; and strengthening strategic alliances and the multilateral system in close partnership with countries of the Global South. Emphasizing the critical role of a strong, effective, and financially sound World Bank Group, the statement reaffirms Germany’s support for the Bank’s Evolution Reforms, its leadership on climate, nature, gender equality, and fragility, and the preservation of its financial strength to deliver stable, low‑cost financing. It highlights the importance of debt sustainability, intensified collaboration among multilateral development banks, and effective support for fragile and conflict‑affected situations, including Ukraine and the Occupied Palestinian Territories. The statement further stresses the need to accelerate climate action, renewable energy, water security, job creation, private sector engagement, gender equality, human rights, and accountability, calling for renewed global cooperation to eradicate poverty and promote shared prosperity on a livable planet.

This statement, delivered by Dario Durigan, Minister of Finance of Brazil, on behalf of Brazil, Colombia, Dominican Republic, Ecuador, Haiti, Panama, Philippines, Suriname, and Trinidad and Tobago, to the 113th Meeting of the Development Committee on April 16, 2026, addresses the compounded challenges facing developing economies amid successive global shocks, geoeconomic fragmentation, and the economic spillovers of the recent Middle East conflict. It highlights rising energy and food prices, supply‑chain disruptions, and inflationary pressures that threaten growth, poverty reduction, and social stability, particularly in countries with limited fiscal space. The statement underscores the need for the World Bank Group (WBG) to deploy counter‑cyclical tools more ambitiously, including measures to reduce borrowing costs, extend maturities, and support food security and social protection at scale. It emphasizes the importance of maintaining strong engagement with middle‑income countries through flexible, voluntary graduation frameworks that preserve policy space and avoid fragmentation of development support. Climate change, adaptation, and biodiversity protection are identified as urgent priorities, with strong support for extending the Climate Change Action Plan and for initiatives such as the Framework for Financial Incentives, the Livable Planet Fund, and the Tropical Forest Forever Facility. The statement strongly supports the WBG’s jobs agenda, while calling for a more balanced approach that integrates industrial policy, value‑addition, formalization, and productivity growth, including through critical minerals value chains. It stresses the need for tailored approaches in fragile contexts, enhanced Global South representation in governance, and modernized accountability mechanisms, reaffirming commitment to an inclusive, effective, and development‑oriented World Bank Group.

This statement, delivered by Bihi Iman Egeh, Minister of Finance of the Federal Republic of Somalia, on behalf of Africa Group 1 Constituency, to the 113th Meeting of the Development Committee on April 16, 2026, underscores the mounting strain on the global development compact amid deepening fragility, intensifying climate shocks, rising inequality, and recurrent global supply‑chain disruptions that disproportionately affect Sub‑Saharan Africa. It warns that the ongoing crisis in the Middle East—particularly disruptions to energy, fertilizer, and shipping routes has compounded Africa’s structural vulnerabilities, threatening food security, inflation stability, and hard‑won development gains, and calls for treating these exposures as long‑term systemic risks rather than episodic shocks. The statement emphasizes that accelerated job creation is an existential imperative for Africa, where demographic pressures, informality, and gender disparities continue to limit inclusive growth. It strongly supports the World Bank Group’s three‑pillar, five‑sector Jobs Agenda for Africa, calling for large‑scale investment in resilient infrastructure, energy, digital connectivity, MSME financing, and regional integration through the African Continental Free Trade Area. The statement highlights the importance of correcting the mispricing of African infrastructure risk through expanded guarantees, equity, and de‑risking instruments, alongside stronger support for formalization, mineral value‑addition, climate adaptation, health resilience, and domestic resource mobilization. It further stresses the need for enhanced engagement in fragile and conflict‑affected settings, improved debt sustainability frameworks that reflect climate and conflict risks, and stronger voice and representation for Africa in World Bank governance, reaffirming commitment to an inclusive, resilient, and jobs‑centered development partnership.

This paper uses the Services Trade Policy Database and Services Trade Restrictions Index to assess services trade liberalization in Africa, building on previous World Bank studies of the African Continental Free Trade Area. The focus is on refining reductions of non-tariff measures in services using sector- and mode-specific policy shocks. The results suggest that reducing sectoral restrictions could boost services exports by 4 percent overall in 2035 and by 14 percent within Africa, with increased imports from outside the region. Key manufacturing exports like textiles and processed foods are also projected to grow, reflecting the role of services as inputs across industries. Conservative scenarios indicate that most African economies benefit from reductions in non-tariff measures affecting services trade.

In 2025, GDP growth declined to 4.1 percent (1.1 percent per capita), as the fuel blockade imposed by terrorists constrained activity. Inflation accelerated to 4 percent. Growth is projected to rebound to 5.0 percent in 2026, supported by mining but weakened by spillovers from the Middle East conflict. Poverty is projected to decline marginally, supported by strong cereal and cotton harvests. Risks include insecurity, climate shocks, and spillovers from conflicts.

Despite a modest increase in aggregate output, economic conditions in Afghanistan weakened in 2025 amid sharp aid reductions, drought, large returnee inflows, and prolonged border closures with Pakistan. GDP per capita is estimated to have declined by 5.6 percent. While fiscal balance was maintained, the trade deficit widened, and the outlook remains bleak amid regional conflict, refugee uncertainty, and declining external aid.

Growth is projected to decelerate to 2.3 percent in FY26 from 4.6 percent in FY25, driven by service sector disruptions linked to the September 2025 unrest, the impact of the current conflict in the Middle East, and slower agricultural growth. Poverty reduction is expected to slow down due to weaker remittances, with many households remaining vulnerable. Medium-term recovery depends on the pace of reforms and reconstruction.