The World Bank Group President, Jim Yong Kim has outlined three fundamental pillars that will drive momentum toward achieving the organisation’s goals of ending extreme poverty by 2030 and boosting shared prosperity.
“We will achieve these goals in three ways: One: accelerating inclusive and sustainable economic growth; Two: investing in human capital; and Three, fostering resilience to global shocks and threats. Two goals, three ways to get there,” said Kim.
Speaking at the Brookings Institution on the eve of the World Bank/IMF Annual Meetings, Kim pointed to a new World Bank report that lays out how income inequality between all people in the world has decreased, and inequality within nations has been falling in many countries, both rich and poor. But inequality is still far too high, both globally and within countries. This constrains growth and breeds instability.
“This means that not only do we need to focus on growth, but we must also continue our work to reduce inequality – we have to make growth more equitable,” Kim stated.
Kim called for a major ramp up in infrastructure finance to boost economic growth, with far greater public-private cooperation on infrastructure investment. At the same time, with increasing reliance on private sector investments, the World Bank Group will have to increase its vigilance to ensure that privatization does not equal exclusion of the poor and marginalised.
“Our top priority is to end extreme poverty and boost shared prosperity, and our engagement with the private sector must be anchored in these two core values,” Kim noted.
On the second pillar, investing in human capital, Kim stated that making investments in the earliest part of people’s lives will make a big difference in countries’ ability to compete.
“Governments that do not invest early in a skilled, healthy, productive workforce are undermining their current and future economic growth,” Kim stated. “We need to help countries understand that investments in human capital are just as critical as investments in ‘hard infrastructure’ if they actually want to spur economic growth and compete effectively in the short, medium and long term.”
Kim stated that these investments will not only lead to inclusive economic growth but will also establish the social foundations that can act as a bulwark against instability, violence and conflict. If these investments in people aren’t made quickly, “not only is it a recipe for poor economic growth, but we will leave a large population of people living in countries where the traditional low skilled jobs are not available and who, often through no fault of their own, simply cannot compete.”