The present international economic crisis poses both challenges and opportunities in terms of realising the potential for sustainable and inclusive growth in Asia. What experiences and instruments are available for this?
A regional conference, organised by Germanys Federal Ministry for Economic Cooperation and Development (BMZ), together with the Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ) and their partner organisations in Asia, is offering a platform for exploring this issue. The conference titled Quality of Growth: Approaches to inclusive development in Asian Societies will be held in New Delhi on September 14 16, 2009. The BMZ has commissioned GTZ to organize the regional conference. On the Indian side, this event is supported by the Government of Indias Planning Commission.
The conference will bring together experts from Asia and Europe with the aim to facilitate an exchange on their countrys specific experiences and approaches, and to stimulate dialogue and cooperation between European (particularly Germany) and Asian countries. The participants political decision makers, representatives from entrepreneurial associations and corporate partners, and civil society will discuss the quality components of growth.
India has been a partner country of German development cooperation for 50 years. For almost all of this time, GTZ Deutsche Gesellschaft fuer Technische Zusammenarbeit (GTZ) GmbH has been active in India on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ).
GTZ was established by the German government as a federal enterprise for sustainable development with worldwide operations in 1975 and works on a public-benefit basis. Its principal client is the BMZ but it also operates on behalf of other German ministries, partner-country governments and international clients, such as the European Commission, the United Nations and the World Bank. GTZ also works for private enterprises, combining the respective strengths of public and private partners to help achieve development policy goals. It provides viable, forward-looking solutions for political, economic, ecological and social development in a globalised world.
To address Indias development priority of sustainable and inclusive growth, GTZs joint efforts with the partners in India currently focus on three priority sectors: energy, sustainable economic development and environmental policy, conservation and sustainable use of natural resources. Additionally, the GTZ also supports Indias public health priorities within the framework of the National Rural Health Mission. Germany and India celebrated 50 successful years of Indo-German Development Cooperation in 2008.
Indo-German Technical Cooperation began in 1958 with Germany supporting the establishment of the Indian Institute of Technology (IIT) in Chennai and skills development and training for the Rourkela Power Plant. The success of the Indo-German Watershed Development Programme led to the creation of a national programme Watershed Development Fund (approximately 100 million in 2006) at the NABARD to implement the Indo-German programmes methodology and results across 100 poorest rain-fed districts in the country.
GTZ also supported the EcoCity programme of the Central Pollution Control Board in Kottayam, Ujjain, Vrindavan, Puri and Tirupati, leading to the improvement of various environmental parameters related to solid waste, liquid waste and air quality management. Together with the Bureau of Energy Efficiency, Ministry of Power, GTZ developed the star-rating system for electrical appliances which has been adopted across the country. Appliances like ACs, refrigerators etc. are rated according to their energy efficiency.
Correcting the current course
The global financial and economic crisis poses enormous economic and social challenges for a large share of the population in many countries, for most governments, and for many entrepreneurs. This becomes manifest in rising unemployment and increasing indebtedness and budget deficits, growing impoverishment and vulnerability, as well as lack of credit and firm closures; all of which can prompt a huge loss of social capital in many countries.
Just as importantly, however, the crisis also provides an opportunity for achieving higher quality growth, as opposed to the merely quantitative results that have been the focus of many in the past.
During the last ten years, Asian countries have experienced admirable economic growth in quantitative terms. However, inequality has also risen due to the inappropriate distribution of growth. Another downside of this development has been the insufficient attention to the rising ecological costs of the high growth, and the inefficiencies in the consumption of energy and other non-renewable resources.
Competitiveness has served as an argument for keeping labour costs low and for concentrating productive power. High growth rates have been achieved, in great part, by export-oriented industries targeting mainly the US and European markets at the expense of further regional integration and domestic markets. In the finance sector, short-term profit orientation has often prevailed. Small- and medium-sized enterprises, lacking technological advice and good access to credit, have rarely been able to modernise production, thus limiting the growth of domestic markets.
These factors, the weakening of traditional safety nets and insufficient social protection, have made it very difficult for the broader population to benefit from increased growth. Meanwhile, additional structural deficits have arisen due to insufficient infrastructure, poor professional training opportunities and inadequate access to social services like health and education.
Neo-liberal tendencies, whereby the state retreats from the surveillance of systemic markets, could and should now be reviewed. Government, while still cautious to get involved in managing the economy, should be much more aware of its responsibility for promoting innovation and socially acceptable structural change, taking care of social justice and protection, as well as for regionally balanced growth, of promoting ecologically more sustainable modes of production and consumption, and of regulating relevant markets such as those linked to finance, energy and the environment.
Promoting regional integration, further developing domestic markets, investment in infrastructure and human capital, as well as responsible competitiveness, based on a more long-term orientation on the part of entrepreneurs and the consideration of the ecological and the social bottom-line, seem to be the order of the day. Such measures could lead to more sustainable and inclusive development, and the abandonment of the unevenly distributed growth path.
Conference goals and who must attend
Conference participants, including high-ranking representatives from different Asian countries, will discuss and identify ways of enhancing existing systems that combine economic, social and ecological factors in order to achieve more sustainable and inclusive growth. More specifically, it is intended that they will reflect on how to realize this objective. In these discussions the financial and economic crisis has to be considered as well.
The conference aims to provide a platform for Asian partners from the public and private sectors and civil society, as well as European experts to exchange their views and experiences. Participants should establish networks for continued communication and cooperation regarding strategies, especially those allowing for the broader population to be incorporated into the development process.
Other key web-sites:
Germanys Federal Ministry for Economic Cooperation and Development (BMZ)
Approximately 200 people are expected to participate in total. The process of mutual learning will continue after the conference, by transmitting the results of the discussions in the different countries.
For participation please get in touch with:
Ms. Inga M. Luehr
Tel: +91-11-2671 5964
Email: quality-of-growth AT gtz.de