Search results

The aim of this study is to examine the motive of China's and India's engagement in African countries particularly in Ethiopia and to address the land grabbing and debt-trap diplomacy between Ethiopia and the Asian drivers, which creates challenges across the diverse social, political, economic and ecological contexts.

This study utilises both primary and secondary data. The available literature is also reviewed. The primary data were gathered through semi-structured interviews and discussions from (1) several authority offices in Ethiopia, sources close to authorities, information-rich informants, employees and (2) perspectives, perceptions and prospects from individual members of society.

The study unmasks the win-win cooperation strategy from the perspective of the members of society in Ethiopia, evaluates whether China and India have strings attached or land grabbing motives. The study also shows that whether China's and India's move was deliberate, the implications of debt-trap diplomacy and exploitation in Ethiopia are apparent. Additionally, this study investigated several considerable potential threats to Ethiopia that will persist unless significant measures are taken to control the relations with Asian drivers.

Some of the limitations of this paper pertain to the primary data collection process from the Ethiopian Investment Commission (EIC) and other authorities, which was very challenging because people can be punished for talking to journalists or researchers. Furthermore, some investors were not willing to participate in discussions because they were engaged in areas that are not related to their licenses. Many interviewees were also not willing to disclose their names, and the data are not exhaustive in the number of investment projects covered.

This study provides new evidence on the influence of Chinese and Indian investment, aid and trade on Ethiopia's social, political and economic spheres. Additionally, this study contributes to the ongoing debate on land grabbing and debt-trap diplomacy in Ethiopia.

This paper aims to provide new insights into the financing system used in emerging economies and how they related to UN Development Goals for sustainable development. The study focuses on small businesses’ informal financing options and whether these lead the borrower into a debt trap.

The study uses the example of small-medium fisheries in Indonesia to highlight the formal/informal financing options availed by the businesses and their relationship with the lender. The authors use the qualitative method with a phenomenology approach and interview key stakeholders in the sector.

The authors find that the set interest repayments and the checks and balances involved in judging the borrower’s creditworthiness make the formal due to the strict requirements. Instead, the fishermen rely on the informal financing system and borrow from the mapak – a person who lends money on the condition that the fishermen’s catch will be sold to the lender as repayment.

This study focuses on the financing system in emerging economies. Using the coastal business areas in the Indonesian fishing sector, the authors highlight the informal financing system and the potential debt trap. Future research could extend and study this issue in other industries and geographic regions to test whether emerging economies meet their targets and commitments under the UN Sustainability Development Goals. Emerging markets like Indonesia have a unique model of financing system and their business structure. Three conditions are highlighted in the financing system of business in coastal areas, namely, informal financing, close market access and social capital.

This study addresses financial inclusion and whether the UN Sustainability Development Goal 8 is being met in emerging economies. The study is one of the few to address this issue and highlights that emerging economies are yet to take concrete steps to make the formal financing sector more inclusive to achieve poverty alleviation.

The microfinancing sector is infamous for being prone to high credit risks due to loan defaults by its poor borrowers. Conversely, the sector is also criticized for creating debt traps for the poor. The dual nature of these peculiar problems in microfinancing causes the market failure phenomenon. Therefore, the current study explores whether public policy intervention is required to address market failure.

The study undertakes a critical review of existing literature, the news, the policy documents and other publicly available information to shape the viewpoints in this study. Constructive criticism is used to build arguments to arrive at a conceptual framework that depicts how public policy should interact with markets to address the peculiar problems of the microfinancing sector.

The findings indicate that market failure in microfinancing is real and pressing. Therefore, public policy is invited, though in its limited form. While the policy intervention may help the formal microfinancing arena by regulating the interest rates, the policy administration in the informal sector is likely to fail. Therefore, the policy should attempt to create an environment of inclusiveness. Policies that rely on coercion are not recommended. In the long run, subsidies via policy intervention are discouraged. Instead, the policy should motivate the microfinancing sector to become self-reliant.

The study is one of its kind to provide perspectives on specific market failures and policy interventions in microfinancing, particularly in economies where formal and informal sectors coexist and are equally crucial.

This paper aims to examine the factors that contribute to the external debt growth in Ghana.

The study adopts the autoregressive distributed lag (ARDL) model and the error correction model (ECM) to establish the short-run and long-run relationships between the dependent variable (external debt) and the independent variables (debt service, exchange rate, gross domestic product, government expenditure, import and trade openness), using a time series data spanning from 1990 to 2019.

The results indicate that debt service, GDP, government expenditure and trade openness have a positive and significant relationship with external debt, while import and exchange rates have a negative relationship with external debt in the long run. In the short run, debt service, import, exchange rate and trade openness have a positive and significant relationship with external debt, while GDP has a negative relationship with external debt.

The study found that variables such as government expenditure, debt service and import contribute significantly to the nation’s external debt stock. These findings suggest that policymakers should focus on prioritising and cutting down expenditure in their quest to curtail the debt menace facing the nation. Since existing debt service has the tendency of influencing debt stock, it is recommended that government should reduce borrowing in order avoid debt trap. Home-grown policies to reduce imports must also be encouraged. As these drivers of external debt are tackled head-on, Ghana can be rightly positioned to record lower levels of public debt and subsequently reap the benefits of economic growth.

The study adds to the public debt literature, specifically addressing the idiosyncratic determinants of external debt within the Ghanaian context.

Kenya basks of a vibrant digital financial sector from her mobile and digital financial services that have led to financial inclusions. On the flip side of it, the Kenyan digital loans sector is facing ethical scrutiny from all and sundry. Issues that are arising include a customer base being trapped in the debt trap, inflated pricing model, high interest rates, and short-term loan tenures. The sector is shrouded in poor transparency and many consumer rights infringement. Undeniably, providers inadvertently breach consumers' right to privacy and tend to promote ‘push loans’ with unsolicited messages to the vulnerable. Additionally, the use of Artificial Intelligence (AI) in determining the suitability of loan applicants via algorithms is seen to be intrusive. With consumer data being mined from the mobile phone, data utilisation, mobile payment usage, airtime usage without users' express consent, it renders the sector an unethical jungle for hunting consumers. Furthermore, consumers who by default end up receiving aggressive uncouth and unprofessional treatment in a bid to recover the unpaid loans. New Product Development (NPD) should, therefore, listen to the consumer's voice for ethical concerns to be reflected in the final product. Thus, marketers should endeavour to give ethical dimensions in NPD a measurable attribute by constantly reviewing it. This chapter examines the ethical implications of developing digital loans in Kenya.

The purpose of this paper is to examine the phenomenon of debt culture in the conventional financial systems and then to compare the existing or emerging trends in the Islamic finance industry. It provides critical insight into why economic policies that are delinked from some fundamental wisdom about sustainable lifestyle might be increasingly less effective.

The paper identifies various areas of impact of the debt culture and provides qualitative analysis based on relevant data.

The data presented in the paper shows that the Islamic finance industry is clearly biased in favor of debt-creating modes, which is expected to lead to promoting the same kind of debt culture as experienced in the conventional financial system.

Finding comprehensive and current data for Islamic financial institutions is a challenging task. The IFIs are not as transparent as their conventional counterparts in sharing relevant data and information.

The paper highlights and analyzes a problem – i.e., the debt culture. Dealing with this problem would be indispensable in the long run for any credible as well as sustainable solutions to contemporary crisis.

Debt culture is more than an economic phenomena. The paper identifies/analyzes several areas, including consumption explosion, speculation, ethics, that are related to debt culture.

This is probably the first research paper that looks into the issue of debt culture in the context of Islamic finance. The contemporary, ongoing global crisis underscores the kind of conventional problems that Islamic finance needs to avoid.

Debt‐equity swaps represent a new market‐based mechanism, by which debtor countries and creditor banks can defuse the acute problems associated with the international debt crisis. This paper describes, analyzes and evaluates debt‐equity swaps from the standpoint of the debtor country. It also discusses some of the possible advantages and disadvantages for LDCs that might contemplate the use of such swaps. The paper demonstrates how a successful debt‐equity swap program could play an important role in alleviating the IDCs' debt problem as well as contributing to their future economic growth.

The purpose of this study is to examine how mindfulness reduces consumers’ buy-now-pay-later (BNPL) payment scheme usage and how that relates to their overall well-being.

This study uses partial least squares structural equation modeling to test the hypotheses of a conceptual framework which is rooted in the extant literature, using an approximately representative sample of Australian consumers (N = 275).

This study finds empirical evidence for the ability of mindfulness to reduce BNPL usage through increasing consumers’ financial self-control and decreasing their impulse buying tendency. This study also obtains empirical evidence that greater BNPL usage is associated with lower subjective evaluations of consumers’ overall well-being by increasing their current money management stress and decreasing their expected future financial security.

Future research could build on the effect of mindfulness that the authors find in this study and how it could be leveraged as a protective mechanism for consumers’ financial decision-making. Such research could involve mindfulness-based interventions, such as instant messaging within smartphone applications. Doing so would also help assess causality, thus addressing the limitation of the cross-sectional nature of this study.

The findings have implications for public policymakers and business practitioners. Financial counselors are encouraged to include the measurement of personality traits such as impulse buying tendency and financial self-control in intake meetings with clients and consider the benefits of offering short mindfulness training. Given the negative effect of BNPL usage on consumers’ financial and overall well-being, and the reputational risks this implies, BNPL providers are recommended to take more responsibility to ensure consumers do not fall into a debt trap, while retailers are advised to take steps to make payment processes more “mindful.”

Although mindfulness has established effects on consumer behavior, its beneficial influence on consumer financial decision-making has rarely been explored. This study also contributes to a better understanding of the antecedents and consequences of consumers’ BNPL payment scheme usage. Although its prominence is increasing in daily life, and despite the concerns of consumer advocates, policymakers and regulators regarding its risks, the topic of consumers’ BNPL usage has received little attention in academic research so far. Finally, this study extends the emerging financial well-being literature by demonstrating how BNPL usage can reduce consumers’ overall well-being through the mediating effect of increasing current money management stress and decreasing expected future financial security.