Consultant in the UN Office of Information and Communication Technology (OICT)
General Understanding of the World Bank
The World Bank is a multifunctional institution focused in economic development, especially, in those developing regions and the sustainable issues highlighted by the UN 2030 agenda (SDGs). We can find that the priorities of the Bank have shifted from trade liberation during the postwar period, toward global poverty alleviation in recent decades. Many efforts have been taken place, along
with Bank’s partnered organizations, the IMF, WTO and United Nations, to achieve the goals of ending the extreme poor and hunger in those low-income countries, as well as other primary focuses in both developing and developed world, such as social protection, public health, education, and environmental concerns.
Without doubt, World Bank have played an influential role in promoting SDGs approaches and building global economic order backed-up by the Washington Consensus. Some debatable arguments can be raised on whether implementing the advocacy of “free-market fundamentalism” for low developed countries is good or bad, however, the World Bank still has had several successful interventions and attempts indeed, for instance, mora than 1700 projects with 202 billion sending
in 145 countries (World Bank Global Research, 2019). The projects cover various topics and purposes in different countries, and I would like to share one of them – Thailand, to further describe the issue and the problem shooting for a certain topic: Informal Sector issue in urban region.
To ensure the contributions in solving the informal problem in Thailand, the next section would like to briefly elaborate the background of informal sector in Thailand. The technology innovation ideas to make changes will be addressed in the following section.
Informal Sector Issue in Thailand
In Thailand, there are approximately 21.4 million informal workers, which accounted for 55.9% of the total workforce in 2016 according to the National Statistical Office of Thailand. They commonly fill work roles including street vendors, construction workers, house maids, and ‘tuk-tuk’ drivers. Compared to formal employees, informal workers usually suffer from low income and little social protection. Furthermore, the study also shows that many informal workers lack of self-discipline when it comes to financial savings and the accessibility to the financial support, and thus find it challenging to insure themselves. In the pilot survey my team conducted by the end of 2017, we found that the monthly income of informal workers ranged from 9,000 THB to 25,000 THB, with debt ranging from 3,000 THB to 40,000 THB. One interviewee pointed out that he often spent money that he intended to save. This group is especially vulnerable to external uncertainties and face serious risks of falling into a poverty trap. Moreover, the informal employment community in Thailand lacks access to skills development opportunities and thus have very little access to useful and affordable financial services that meet their needs – payments, savings, credit and insurance (ILO, 2017). Given this reality, capacity building and fintech innovation regarding jobs, vocational training, and professional enrichment opportunities could prove very beneficial in boosting productivity and integrating the informal economy into the formal sector.
Potential Technology Innovation Case
The technology innovation could be one of the solutions to fix problems that generate from informal sector, and achieve social protection or even the more responsible and sustainable goals. The World Bank and its partners have worked on such topics of poverty eradication and other marginalized groups for long. In Thailand, persons with disability, women, youth, and elderly can be vulnerable especially outside the formal economy. Technology is critical in providing the solutions to social issues as it often uses for capacity building and bridges the divide between economic progress and social justice. Indeed, many well-known institutions like the Bank and United Nations have addressed the importance of tech innovation that can carry out inclusiveness, sustainability, and accessibility in more fields. Given technology innovation is pivotal to social progress, the fact that
citizens or people work in grey economy do not have access to such approaches needs to be focused and the proper actions should also be done to improve individual, organizational, and broader institutional capacities in a region.
My experience working with the Bank’s side project in 2017, especially in the focus of Thailand’s informal economy, was trying to figure out a feasible solution (and the social enterprise-like product) for such issue. The so-called “Group-Supporting System (GSS)”, which is a smartphone-based application and the main participants (users) can be both informal workers and supporters, was
a brainstorming result from the teamwork in the Idea for Action (I4A) proposal selection in 2017. The core function of GSS is to enhance the sharing of resources (financial resources and informational resources) among informal workers, by creating a large online social network, recording the credit history of users to reduce fraud and defaults, and building trust among informal workers. Indeed, the ideas of GSS reference other existing concepts and platforms, such as “decentralized hyper-ledger” from blockchain initiative, ”the “sharing economy”, “ROSCAs”
(Rotating savings and credit associations) in Africa, “Peerby” in Amsterdam, “WING” in Cambodia, and “Peer-to-peer Lending” in the UK. Moreover, the designed mechanism shares similarities with technology-based innovations such as Uber, Airbnb and “Qing Song Chou” and “Ali-Pay” in China.
Due to the limited space of proposal, it may not be able to give a comprehensive picture of the GSS’ idea. But in short, this project was focusing on two major functions: “information sharing” and “finance supporting” to the people in need, which are similar to the Bank’s functions for the world to achieve 2030 agenda: Innovative Knowledge Sharing, and Financial Products and Services. By implementing such technology or innovative methods, it’s believed that more measurable results shall be able to sharpen the focuses on helping developing countries, their governments, societies, and the target groups such as informal workers and their families.
World Bank’s Role and Contributions
As the leading institution, the World Bank will need to make contributions toward each sustainable program and comply the Bank’s policies and stakeholders’ initiatives. From the case I select in this essay – informal sector in Thailand, along with the technology innovation-approach and concepts that mentioned in GSS prototype, it’s believed that the participation from either private sectors, or from
individuals, can add values to the Bank’s needs across a wide range of sectors and developing regions. With the knowledge of cutting-age trend of technology and the ability to integrate information from theoretical into practical action, the Bank shall leverage its expertise to assist with different aspect of works, for example, design and lead the projects, make information more accessible, improve financial exclusiveness through innovative approach, bring impacts closer to client communities, and focus on result-oriented engagement with client government, institution, academy, and the public.
To conclusion, I would like to highlight one of the most favorite quote remarked by the second Secretary-General, Mr. Dag Hammarskjöld: “The United Nations was not created to take mankind to heaven, but to save humanity from hell”, which I believe the similar value should be shared by the World Bank Group and its institutions. It’s challenging but meaningful to turn this value to the real world, and it also hope that everyone, government, and correlated parties around need to engage in it, empower the technology-based solution, and enhance the creation of the public good.