Sunday, December 10, 2017

Inclusive Growth Agenda for the Asia-Pacific Region

   The Asia-Pacific region is increasingly becoming the center of the global economy, driving world economic growth. However, structural changes in the economy and industry caused by the Global Financial Crisis have slowed regional economies efforts to resolve adverse issues hindering quality

     Economies in the region have been seeking feasible policy measures to promote inclusive growth. This means economic growth that promotes opportunities equally throughout society and distributes the benefits of increased prosperity in monetary and non-monetary terms more equitably.

     Inclusive growth should develop in concert with overall economic growth so that the two can benefit from a synergistic effect. If the two diverge, there is a risk that only a select few ends up enjoying the benefits of faster growth resulting in undesirable outcomes including increased social 
tensions undermining the consensus for solid growth strategies.

     According to research carried out by the Asian Development Bank, promoting economic growth is a necessary condition for reducing poverty. Moreover, the extent of the success of poverty reduction strategies depends not only on the speed but also the form of growth. Inclusive growth places
similar emphases on equal opportunities and economic growth. Economic growth should incorporate the following: 1) help mitigate possible distortions introduced by the market, competition and unexpected market failures, and provide more opportunities for the less well-off in society to grow; and 2) ensure a social safety net for those classified as the chronically poor, to provide for their specific needs.

     To sum up, inclusive growth emphasizes equal opportunities for all thereby giving everyone a chance to develop. It promotes creating sufficient number of jobs through solid and continued economic growth, and offering comprehensive social inclusion.

     Solid and continued economic growth is driven by the private sector, while the public sector is responsible for providing good infrastructure, human capital and economic stability, and policy measures such as taxation as incentives to cope with market imbalances, reduce the impacts of external factors, and maintain a healthy environment more conducive to investment and business.

     Inclusive growth was listed as a core principle of the APEC Growth Strategy in the 2011 Leaders' Declaration. Other principles included balanced, innovative, secure and sustainable growth. The idea of principles is to ensure that all people, in the process of globalization and regional economic integration, have access to opportunities and successes. The strategy also included bolstering the development of micro, small and medium-sized enterprises (MSMEs), promoting the entrepreneurial spirit, boosting human capital development and encouraging employers to hire more manpower. Implementation is expected to improve social safety nets and support disadvantaged groups. The APEC Growth Strategy is therefore geared toward "complete social inclusion."

     Furthermore, to sustain high levels of economic growth, innovative growth driven by the digital economy cannot be ignored. New and innovative digital products and services have brought transformed lifestyles and businesses, causing a digital revolution. The digital economy has rapidly

entered the mass market, improving the efficiency of individuals, enterprises and governments, each in their own ways. In view of various priorities and needs in the region, the inclusive growth agenda in the Asia-Pacific should address the following key elements: the digital economy, MSMEs, women's empowerment, and jobs and skills.

Digital Economy

     There is currently a huge gap in economic development in the Asia-Pacific region. Several economies are still in the emerging and middleincome category. With appropriate investment, digital technologies and innovative business models could contribute to overcoming obstacles to

economic development and financial inclusion.

     Digital economy by definition refers to the economy supported and promoted by digital computing technologies. The traditional economic system is constrained by the law of diminishing returns. However, the digital economy will change the rule of the game to enjoy the "law of increasing returns", simply because all data can be processed and digitalized to be knowledgeable products. In addition, the digital economy will also help increase government efficiency, transparency and inclusiveness. The digital economy will certainly require an optimal budget allocation, but in the

following decade it will be a core factor in promoting inclusive growth.


     Most businesses in the Asia-Pacific region are characterized as MSMEs. They provide the highest percentage of jobs. Hence, they are important drivers of inclusive growth and increased ompetitiveness. During the digital transformation of the economic and business environments of small enterprises, policymakers should provide business information, training, and access to funds to increase the competitiveness of MSMEs at good times and enhance resilience at bad times. This will also enable these enterprises to integrate more smoothly into global value chains and allow them to take more independent and critical roles in the regional economy.

Women Empowerment

     This will be a crucial factor driving economic prosperity and growth in the Asia-Pacific region. Women constitute half of the world's population, yet their participation in the global labor market is not proportionate. There remains considerable growth potential in this area. Increasing the labor

participation of women will certainly bring added value, create socioeconomic benefits and ultimately contribute to inclusive growth.

     The public, business and labor sectors should work together to bring about equality in work and life to encourage and empower women into the workplace. Promoting professional skills training to increase the areas in which women can develop further will also enhance the quality of family


Jobs and Skills

     To increase the employment rate and competitiveness of the unemployed and young graduates, we need to make certain investments in human capital development. This entails making available relevant and specific professional skills training, providing assistance for the physically and mentally disabled, as well as offering a diversity of choices in education and vocational training.

     Establishing links between academic and technical competencies,providing practical and accessible training options, helping people gain new skills are all important objectives. Investments made now to better equip the human resources adapt to the fast-changing nature of jobs will go a long way toward addressing the potential gaps in the future labor market.


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