The received wisdom is that beyond all else, economic essentials of fiscal stability, trade flows and investments drive economic growth. That point of view, rightly stressing the essentials of growth, deserves to be qualified, however. Emerging experiences suggest the centrality of three other themes, not only as desirable in themselves but as essential to continued growth. They are: a better environment, greater inclusion and improved governance.
This collection of articles (adapted slightly to fit the volume) communicates the ideas behind these themes. The pieces cover a broad range of media outlets and provide a cross section of work at the World Bank Group, at the Asian Development Bank and partner institutions. They encapsulate efforts to improve our response to the central challenge of sustaining development.
Consider the growing threat from environmental degradation. Action to combat it needs to be proactive, not reactive, in particular because the cost of prevention is far less than the cost of cure. Dealing with natural disasters mostly after calamity strikes is, nonetheless, still all too common, as made tragically clear in the aftermath of various events, be it the great Thailand floods in 2011, Hurricane Sandy in the US in 2012 or Typhoon Haiyan in the Philippines in 2013. In these and other instances, lives could have been saved and the extent of devastation averted with better proactive planning (see Typhoon Haiyan Should Spur Climate Change Action).
Rising economic inequities are another concern. Global poverty has fallen sharply, led by China and India, where strong growth lifted millions. At the same time, however, inequality has surged. Including more people of the lower income strata in the growth process would be a smart way to generate more growth. More investment in education, health, and social protection are key (see Reduce inequality to sustain economic growth).
No magic bullet can solve environmental problems or reduce economic inequality. But there is a common denominator to greater success in development—better governance. Frequently, solutions to environmental and social problems are widely known and the needed policy directions clear. Yet vested interests frequently block change, fueled by weak government and rampant corruption (see Asia’s transformation through better governance).
Environmental, social and institutional issues increasingly occupy center stage today and involve developing and developed nations alike. The opinion pieces in this volume reflect the changing understanding of environment, inclusion and governance over the years, and point to ways forward.