Economic diversification is a top priority for countries depending on the export of a primary commodity, such as oil and gas. Diversification reduces volatility and vulnerability to external shocks, which allows for a more balanced growth. However, economic diversification presents several risks, such as: channeling resources to non-competitive businesses unable to survive without government support or taxing competitive businesses under the pretext of generating a new source of income for government. We partner with decision makers to establish an appropriate incentive framework, enact policy reforms, and create local institutions that would promote healthy diversification.

 

The Danger of Priority Sectors

Priority sectors can lead to imbalances, diverting finance to businesses that would collapse when government support ceases to exist. We help decision makers in creating a regulatory and institutional framework able to attract competitive businesses and sectors that do not require public funding to succeed.

ECONOMIC DIVERSIFICATION

Identify Attractive Infrastructure Projects

Government funding of infrastructure projects risks wasting resources on building facilities that will never be fully utilized. We help leaders create a system designed to identify infrastructure projects that would attract dynamic and competitive businesses, able to perform structural transformations.

ECONOMIC DIVERSIFICATION

Dedicated Trade Policy for Economic Diversification

Technological innovations, automation, and globalization are already performing structural transformations across the world. We assist leaders in designing competitive trade policies that would attract foreign direct investment in high added-value industries, facilitate import/export activities, and reduce local production costs.

ECONOMIC DIVERSIFICATION