In addition to the pandemic, ESCAP said in a press release shows that the local economy faces “several downside risks.”Rising inflationary pressures, prospects for interest rate hikes, shrinking fiscal space”, and emThe global economic impact of Russia’s continued invasion of Ukraine.
Economic growth of developing countries within vast areas is 4.5% in 2022 and 5% in 2023 compared to projected growth of 7.1% in 2021.
$2 trillion loss
From 2020 to the present, the cumulative production loss due to COVID-19 for developing countries in the region is estimated at nearly $2 trillion.
The survey warns of cuts in public spending on health care, education and social security “to protect the progress of developments over the past few decades and to prevent further inequality in the region”.
The pandemic has left more than 820 million informal workers in the ESCAP region and more than 70 million children from low-income families denied income and adequate access to schooling, the report notes.
“These results will leave a scar on the future income potential and overall productivity gains of these people,” ESCAP said. On the other hand, an additional 85 million people in Asia and the Pacific have already been pushed into extreme poverty by 2021.
“As developing countries in the region learn to live with COVID-19 and balance public health and livelihood protection, It is time to lay the groundwork for a more equitable future of equal opportunity and inclusive outcomes.“, said ESCAP Secretary-General Armida Salsiah Alisjahbana.
3 action plans
The Commission recommends a “three-pronged policy agenda” aimed at building an inclusive economy in the region.
First, develop instead of shrink Countries in the region should shift their public spending towards basic universal health coverage.Moving towards universal primary and secondary education and expanding social security coverage.
The Commission argues that “smart” fiscal policy can improve overall efficiency and the impact of public spending and revenue collection. At the same time, new revenue streams must be explored, such as: tax the digital economyAlong with shifting the tax burden to higher-income households.
Second, the 2022 survey argues that the region’s central bank can and should tilt traditional monetary policy toward promoting inclusive development. While continuing to focus on keeping inflation low and stable, central banks can invest part of their official reserves in social bonds. Exploring how central bank digital currencies can improve financial accessEncourage more innovative financial instruments to secure a social safety net.
Third, governments can also proactively guide, shape and manage the structural economic transformation process increasingly driven by the digital-robot-AI revolution, resulting in more inclusive outcomes.
These include support for labor-intensive skills development, comprehensive access to quality education, retraining of skills, strengthening labor bargaining capacity, and levels of social protection.
The Economic and Social Survey of Asia and Pacific is the United Nations’ oldest and most comprehensive annual socioeconomic study, first published in 1947, to inform policy-making in the region.