By Simi Mehta
The concept of sustainable economic development can be explained in the words of Simon Smith Kuznets – the man who created the concept of Gross Domestic Product (GDP) The welfare of a nation can scarcely be inferred from a measurement of national income, and for his empirically founded interpretation of economic growth which led to new and deepened insight into the economic and social structure and process of development for which he was awarded the Nobel Prize in Economic Sciences in 1971.
After decades of measuring economic progress in terms of income growth, national leaders are now paying much more attention to the quality of that growth. The shift stems from a growing realization that an impressive rise in gross domestic product per capita in the short term means little if living standards are undermined in the long term by poor health, under-investment in education, a degraded environment, and a widening gap between rich and poor. What is important for rising national income to translate into greater well-being for the population at large, on a sustainable basis.
Sustainable economic development means that the governments and leaders of the world must think of a long term development process as being the most important thing to grow, and devise goals and ways to translate the GDP growth into the sustainable growth and benefits of the population. This is because alleviation of poverty, improvement in healthcare services, levels of educational developments, etc. show the real social progress and development. The success story of Brazil is worth a mention here, as it has the best score (as compared to other BRIC countries) in improving the well-being of its population with regards to improving its environment and on the reduction of income inequality, especially in encouraging the lower-income families to send their children to school, and also to get them immunized.
Sustainable economic development deals with the aspect of governance and the state of activeness of the governments for their citizens, i.e., how the governments utilize their democratic framework, the various rights and freedoms that are spelt out in their Constitutions, the transparency and accountability of governmental activities, etc. So that one can assess whether the government in question actually has the capacity to deliver the promised socio-economic programs or not. It means how effectively it handles the resources of the country and whether or not it focuses on infrastructural expansion, education and healthcare.
Sustainable economic development shows how well a country translates its wealth, or income, into the overall well-being of its population. Various findings from research organizations like the Sustainable Economic Development Assessment of Boston Consulting Group shows that countries with higher GDPs are not necessarily the best at converting their wealth into well-being for their citizens. A number of Eastern European nations, such as Albania and Romania, and such Southeast Asian countries as Indonesia, the Philippines, and Vietnam, score particularly high in converting wealth into well-being.
Some policy recommendations for a sustained economic development are:
a) Build strong economic foundations: strengthen public financial management at national, regional and local levels; improve regulatory frameworks and systems to stabilize economies; support governments and private sector to expand their businesses and integrate into the regional and global markets; build capacities to sustainably manage natural resources.
b) Grow businesses: strengthen support for micro, small and medium-sized private sector businesses, particularly those owned by women; increase productivity; increase the availability of financial services (including micro-finance).
c) Invest in people: increase access to demand-driven skills (including literacy and numeracy); increase workplace learning opportunities (esp. in agriculture); support learning initiatives, which lead to occupational growth; market expansion and increased productivity.
The ideology of unfettered growth for over two centuries, the untrammeled free-market led growth has led us to the present anthropogenic era, where the collective impacts of human activities have exceeded the natural changes in the earth systems.
To have an ecologically sustainable economy, it is important that economic and industrial developments are ecologically centered, so that the ecological footprints of the economy are sustained. The general people especially the youth need to take responsibility for this discourse, where economic and ecological choices are discussed widely at forums like the UN and its several agencies, G-20 and others so that a collective wisdom informs the directions for a sustained economic future. Thus, a sustainable economic development strategy provides guideposts on the way to the full realization of the promise of the sustainability revolution. As such, it can help create a place that the residents will be proud to hand on to their children and their childrens children.
(simimehta.08@gmail.com)