This is too low to support higher growth rates that will reduce unemployment and emigration. Improvements in regulatory quality, fair and transparent ‘rules of the game’, and transparent and accountable institutions will help attract higher levels of foreign investment.
The main reason why there is an inadequate supply of instruments for hedging against the risks incurred in annuity provision (longevity risk, inflation risk, financial market risk) is of course the lack of natural issuers, at least in the private sector. Due to their extended timehorizon, governments are a natural candidate to re-insure these risks.