s we look toward the post-pandemic era, it’s already been dubbed “the next normal,” indicating a new economic and systemic landscape that requires us to reimagine the way we work, live, and learn as individuals, communities, nations, governments, and as global citizens.
The devastation caused by COVID-19 in developing countries means the next normal will include a set of harsh realities and there has been a significant reversal of development gains. For example, 100 million more people are in extreme poverty since the onset of the pandemic and food insecurity and hunger have surged as food prices rise sharply and incomes fall. After years of worldwide improvements towards gender parity in education, girls suffered more from school closures and have been less likely to return, especially at secondary levels, where critical employment-related learning takes place. One study estimates that at least 20 million more girls will have dropped out of school permanently after the pandemic. Inequality on every dimension has been exacerbated, including widening digital divides and a disproportionate worsening of youth and women’s workforce participation rates and prospects.
In 2018, the World Bank issued a report titled “Building Back Better” in response to natural disasters that were heavily affecting poor and vulnerable communities. The report set out a resilience-oriented approach to reconstruction, one that would better prepare communities to respond to—and mitigate—the level of devastation and damage from such events. Three years later, this approach has taken on new meaning and urgency as the scope and scale of disruption to individual livelihoods and economies has hit new levels due to the pandemic. In addition, economic recovery is hampered by more than “just” the virus. There are demographic shifts, the compounding forces of climate change, conflict, and crises whose impacts are felt stronger in developing countries and by already disadvantaged populations.
Revised resilience for inclusive, sustainable growth
Resilience is commonly defined as a capacity to recover from difficulty or shock – such as economic collapse, natural disaster, or war. Resilience approaches generally have a reactive and primarily defensive posture– focusing on risk mitigation, prevention, and protection as well as response. They also include preparation and adaptive elements to better anticipate and prepare people and communities for shocks. USAID’s first agency-wide policy guidance on resilience, released in 2013, sought to increase the adaptive capacity of partners and grantees, improve their ability to address and reduce risk, and improve the social and economic conditions of vulnerable populations.
Current realities, however, underscore the need for a revised posture in economic development cooperation and greater ambition for economic growth in the next normal. Shocks and challenges can bring opportunities as well. For instance, the pandemic highlighted the need for expanded care systems in developing countries. This could create low- and middle-skill employment and enterprise. Rising food prices may entice youth who are otherwise averse to work in agriculture into higher value farming and agribusiness, mitigating persistent unemployment and pressures on market systems. In response to climate change, new green industries are emerging, generating millions of private sector jobs and business potential. Agglomeration economies in rapidly expanding cities can disseminate ideas and information that increase market access and efficiency. Population dynamics can boost returns giving way to demographic dividends.
Defensive actions remain important for economic recovery and resilience in the face of economic shock and upheaval. However, a proactive and offensive posture is necessary to take advantage of new markets and growth opportunities. Beyond defensive resilience, we must go on the offensive towards more inclusivity, sustainability, and prosperity. With a resilience foundation, this kind of economic development posture can be thought of as one of transformation, defined by change in what we do and the results we seek.
Putting posture into practice
In practice, this offensive transformation means realignments and adjusted priorities. This requires investing in individual and institutional actors at all levels, so they are prepared to take advantage of where markets are heading. Further, it means doing this in a way that benefits many, mitigating inequities and sharing outcomes so that no one is left behind.
Capacity building is central to resilience programming and intensifying efforts to build and strengthen transformative capacities. From an economic development perspective, this means building the capacity and competitiveness of market actors and institutions by instilling in-demand skills and entrepreneurial mindsets and strengthening extension services, market information systems, social capital, and networks. Increasing local ownership of— and participation in— interventions will also support this offensive stance; as will preparing workers to compete in growth sectors and an increasingly international labor market.
Innovation in products, services, distribution, and business models is vital to this shifting posture as is the need to support further adoption and dissemination of digital technologies and other tools that catalyze economic participation. During COVID-19 lockdowns in Uganda, a USAID-funded resilience project supported business service providers who normally provide in-person services to farmers to build on the social capital they had developed and pivot to a virtual and contactless model. Using mobile information gathering, motorcycle goods transport, and fixed delivery points, they safely managed the distribution of agricultural inputs to farmers with protective gear, social distancing, and sanitization.
In addition to capacity and innovation, an offensive economic development approach will incorporate inclusive financial services that not only protect assets, but also help more people generate wealth and promote economic empowerment. Similarly, measures to increase productivity and income generation within the informal sector as well as to prolong the ability of older workers to earn and contribute economically as they age are critical.
Across these elements, policy is an important aspect of offensive resilience and turning challenges into equitable opportunities. Proactive policies and regulations that encourage new industries, enable small business, activate labor markets, combat corrosive corruption, and limit the likelihood of growth only benefitting a small segment of society are among the most pertinent.
Taken together, these practices can help reorient economic development cooperation to seize growth opportunities in the next normal—advancing a resilient future-proof economy as well as an inclusive, competitive, sustainable “future-prosperous” one.
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Reorienting Resilience For Growth in the Next Normal
Delhi, India. Photo via Unsplash.
January 10, 2022
The pandemic has reversed many hard fought development gains in poorer countries, with over 100 million more people in extreme poverty as a result. This demonstrates the need to change how we approach resilience to be more inclusive and sustainable, writes Nicole Goldin.
A
s we look toward the post-pandemic era, it’s already been dubbed “the next normal,” indicating a new economic and systemic landscape that requires us to reimagine the way we work, live, and learn as individuals, communities, nations, governments, and as global citizens.
The devastation caused by COVID-19 in developing countries means the next normal will include a set of harsh realities and there has been a significant reversal of development gains. For example, 100 million more people are in extreme poverty since the onset of the pandemic and food insecurity and hunger have surged as food prices rise sharply and incomes fall. After years of worldwide improvements towards gender parity in education, girls suffered more from school closures and have been less likely to return, especially at secondary levels, where critical employment-related learning takes place. One study estimates that at least 20 million more girls will have dropped out of school permanently after the pandemic. Inequality on every dimension has been exacerbated, including widening digital divides and a disproportionate worsening of youth and women’s workforce participation rates and prospects.
In 2018, the World Bank issued a report titled “Building Back Better” in response to natural disasters that were heavily affecting poor and vulnerable communities. The report set out a resilience-oriented approach to reconstruction, one that would better prepare communities to respond to—and mitigate—the level of devastation and damage from such events. Three years later, this approach has taken on new meaning and urgency as the scope and scale of disruption to individual livelihoods and economies has hit new levels due to the pandemic. In addition, economic recovery is hampered by more than “just” the virus. There are demographic shifts, the compounding forces of climate change, conflict, and crises whose impacts are felt stronger in developing countries and by already disadvantaged populations.
Revised resilience for inclusive, sustainable growth
Resilience is commonly defined as a capacity to recover from difficulty or shock – such as economic collapse, natural disaster, or war. Resilience approaches generally have a reactive and primarily defensive posture– focusing on risk mitigation, prevention, and protection as well as response. They also include preparation and adaptive elements to better anticipate and prepare people and communities for shocks. USAID’s first agency-wide policy guidance on resilience, released in 2013, sought to increase the adaptive capacity of partners and grantees, improve their ability to address and reduce risk, and improve the social and economic conditions of vulnerable populations.
Current realities, however, underscore the need for a revised posture in economic development cooperation and greater ambition for economic growth in the next normal. Shocks and challenges can bring opportunities as well. For instance, the pandemic highlighted the need for expanded care systems in developing countries. This could create low- and middle-skill employment and enterprise. Rising food prices may entice youth who are otherwise averse to work in agriculture into higher value farming and agribusiness, mitigating persistent unemployment and pressures on market systems. In response to climate change, new green industries are emerging, generating millions of private sector jobs and business potential. Agglomeration economies in rapidly expanding cities can disseminate ideas and information that increase market access and efficiency. Population dynamics can boost returns giving way to demographic dividends.
Defensive actions remain important for economic recovery and resilience in the face of economic shock and upheaval. However, a proactive and offensive posture is necessary to take advantage of new markets and growth opportunities. Beyond defensive resilience, we must go on the offensive towards more inclusivity, sustainability, and prosperity. With a resilience foundation, this kind of economic development posture can be thought of as one of transformation, defined by change in what we do and the results we seek.
Putting posture into practice
In practice, this offensive transformation means realignments and adjusted priorities. This requires investing in individual and institutional actors at all levels, so they are prepared to take advantage of where markets are heading. Further, it means doing this in a way that benefits many, mitigating inequities and sharing outcomes so that no one is left behind.
Capacity building is central to resilience programming and intensifying efforts to build and strengthen transformative capacities. From an economic development perspective, this means building the capacity and competitiveness of market actors and institutions by instilling in-demand skills and entrepreneurial mindsets and strengthening extension services, market information systems, social capital, and networks. Increasing local ownership of— and participation in— interventions will also support this offensive stance; as will preparing workers to compete in growth sectors and an increasingly international labor market.
Innovation in products, services, distribution, and business models is vital to this shifting posture as is the need to support further adoption and dissemination of digital technologies and other tools that catalyze economic participation. During COVID-19 lockdowns in Uganda, a USAID-funded resilience project supported business service providers who normally provide in-person services to farmers to build on the social capital they had developed and pivot to a virtual and contactless model. Using mobile information gathering, motorcycle goods transport, and fixed delivery points, they safely managed the distribution of agricultural inputs to farmers with protective gear, social distancing, and sanitization.
In addition to capacity and innovation, an offensive economic development approach will incorporate inclusive financial services that not only protect assets, but also help more people generate wealth and promote economic empowerment. Similarly, measures to increase productivity and income generation within the informal sector as well as to prolong the ability of older workers to earn and contribute economically as they age are critical.
Across these elements, policy is an important aspect of offensive resilience and turning challenges into equitable opportunities. Proactive policies and regulations that encourage new industries, enable small business, activate labor markets, combat corrosive corruption, and limit the likelihood of growth only benefitting a small segment of society are among the most pertinent.
Taken together, these practices can help reorient economic development cooperation to seize growth opportunities in the next normal—advancing a resilient future-proof economy as well as an inclusive, competitive, sustainable “future-prosperous” one.
