WEF: ‘In most economies, GDP growth is neither sustainable nor inclusive’
New Delhi: The growth of Gross National Product (GDP) in most countries is neither sustainable nor inclusive, the World Economic Forum (WEF) said in a study on Wednesday.
The Future of Growth Report, released in Davos, Switzerland, during the ongoing WEF Annual Meeting 2024, called for a new approach to economic growth that balances efficiency with long-term sustainability and equity, examining speed and quality together, the media reported.
The report said most economies are growing in ways that are neither sustainable nor inclusive and are limited in their ability to absorb or generate innovation and minimize their contribution and susceptibility to global shocks.
High-income economies score high on innovation and inclusion, while lower-income economies on sustainability, according to the report that took a holistic look at GDP alongside the quality of growth across 107 economies.
Among the lower-middle-income economies, India and Kenya scored high on sustainability, Jordan on innovativeness, Vietnam on inclusiveness, and the Philippines on resilience.
Common challenges preventing a stronger balanced growth performance of this group included technology absorption, lack of social safety nets, insufficient investment in renewable energy, and insufficient healthcare system capacity.
The report highlighted a significant economic slowdown, estimated to fall to the lowest rate in three decades by 2030, amid ongoing economic and geopolitical shocks.
This downturn is exacerbating a range of interconnected global challenges, including the climate crisis and a weakening social contract, which are collectively reversing progress in global development, it said.
“Reigniting global growth will be essential to addressing key challenges, yet growth alone is not enough,” said Saadia Zahidi, Managing Director, WEF.
“The report proposes a new way for assessing economic growth that balances efficiency with long-term sustainability, resilience, and equity, as well as innovation for the future, aligning with both global and national priorities,” she added.
At an individual level, none of the 107 economies covered by the report attained a score higher than 80 on any of the framework’s four dimensions.