Spatial Analysis: A Multi-Sectoral Program in Support of Economic Transformation The World Bank

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1 Spatial Analysis: A Multi-Sectoral Program in Support of Economic Transformation The World Bank AFTSD Presentation to the E-DPG March 8, 2012

2 What do we mean by spatial analysis? Use of Geographical Information Systems (GIS) to underpin economic analysis of policy decisions: Visual approach: superimpose multiple layers of geographically referenced information to see linkages. Economic approach: use maps to derive location-specific estimates of economic parameters. Anchored in WDR 2009: Places do well when they promote transformations along the dimensions of economic geography: higher densities shorter distances and fewer divisions

3 Conceptual framework TRANSPORT AGRICULTURE ENERGY ICT spatial interactions EDUCATION FORESTRY HEALTH WATER MANUFACTURING EXTRACTIVES SERVICES

4 Why do we use spatial analysis? The WB uses spatial analysis as a multi-sectoral analytical framework to: Increase effectiveness by coordinating infrastructure and productive sectors public and private efforts interventions across countries Improve sustainability by coordinating donors investment pipelines micro-macro linkages Inform selectivity by prioritizing interventions across sectors interventions within sectors

5 Coordinating between infrastructure and productive sectors

6 Liberia awards agricultural and forestry concessions covering 20-40% of land area

7 Timber exports are physically trapped due to poor state of roads and ports.

8 Coordinating between infrastructure and productive sectors Generic message Productive sector development plans need to be consistent with infrastructure development plans Specific example In Liberia, exports of forestry concessions are becoming constrained by lack of coordination with downstream road and port infrastructure How can this be used in Mozambique?

9 Footprint of Mozambique mining concessions is becoming quite extensive

10 though most important sites can be clustered in three areas Nacala/Nampula Cluster Tete Cluster Quelimani Cluster

11 Mining concessions share space (and infrastructure) with high agriculture value areas

12 Coordinating between public and private sectors

13 Rail options for exporting Guinean iron ore deposits

14 Lifecycle rail transport cost (US$billions) Liberia rail route results in cost savings of >US$1bn To Conakry To Monrovia To Buchanan Cost of moving iron ore falls from US$3.50/t to US$0.75/t

15 Rail options for Yekepa to Buchanan corridor

16 Lifecycle rail transport cost (US$ billions) Integrated double track saves costs and improves performance Single Line (Rehab) Single Line (New) Two single lines One double line Allows for faster velocity and longer trains, as well as facilitating sharing

17 Coordinating between public and private sectors Generic message Major private investments in infrastructure should not be taken in isolation from public investment plans Specific example In Liberia coordination between private concessionaires and railway network design could save over $1 billion in transport costs How can this be used in Mozambique?

18 Rail options for Mozambican coal deposits and regional transit are multiple

19 just for Tete, a single outlet is not enough, but financial sustainability of selected corridors critical

20 Prioritizing interventions within sectors

21 ERR (%) Multi-modal corridor packages outperform national transport plan Corridor Pointe Noire-Brazzaville- Ouesso (rail/river) Transport Master Plan

22 In RoC, multi-modal corridor packaging increases marginal returns of isolated interventions Rehabilitation CFCO Railway Individual ERR: < 0 Marginal ERR within corridor: 12% River Improvements Individual ERR: 24 % Marginal ERR within corridor: 32% Port of Point Noire Individual ERR: 7%

23 Economic returns coming simultaneously from different RoC key sectors Impact on Production Values (% change) 51% 6% 22% 11% Crops Imports from Doula Imports frompointe Noire Manufacturing and Services Timber through Doula -23% Timber from Pointe Noire -100%

24 Prioritizing interventions within sectors Generic message Organization of investments along corridors can significantly boost returns over isolated projects Specific example For RoC, returns on transport interventions triple when projects organized along corridors compared to standard sector investment plan How can this be used in Mozambique?

25 Infrastructure network has the potential to boost productive sectors when strategically planned

26 On-going and next steps Mozambique Spatial Development Agenda