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The Pandemic Revives the Debate on Development and its Discontents

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Authors: N.S Abhilasha and Aishwarya Bhuta

The COVID-19 pandemic has dealt a devastating blow to lives and livelihoods across the world. No nation-state, be it rich or poor, strong or weak, rogue or failed has been spared by this unanticipated catastrophe. A superpower such as the United States of America has had to kneel before the mighty crisis, while other European giants the likes of Italy, Spain, UK, and France have also been forced to lay their arms down. At the same time, the small island nation of Cuba has been exemplary in extending international medical support to severely affected Italy as well as Qatar, South Africa, Algeria, and Venezuela. Such contradictions compel us to engage into a critical interrogation of the idea of development itself.

The Age of Improvement

It is useful to look into the origins of modernization before we analyze development in contemporary societies. The 1550s mark the onset of the early modern period. The eighteenth century was called the Age of Improvement. Empirical sciences such as botany and geology enabled human beings to see, classify and replicate natural resources. Desired improvements could be brought about by dominance over natural and human resources in order to produce  crops and commodities of the highest economic value. To improve was to be able to see and use every tree of well planned, neat-looking forests, as Richard Drayton observed in Nature’s Government (2000).

Science with its power of reason aided Europeans to colonize unknown lands, but there was no dearth of challenges for them. Epidemics, famines and earthquakes followed in quick succession. Serious investments in medical science started only by the mid-nineteenth century. One of its objectives was to rebrand their image as benevolent rulers. Scientific societies with ‘experts’ were appointed in-charge of surveys and documentation. However, there was little emphasis on basic amenities such as nutrition, safe housing and sanitation in the colonies. Private interests of mine owners, plantation owners and traders invariably held a sway on scientific pursuits.

Modern State and Welfare

The late twentieth century saw increasing movements for independence and growing demands for equal rights. A welfare state is one where social services such as education, health-care and nutrition are considered to be rights, i.e. citizens need not depend on market forces for the same. But the newly formed governments could not undo the image of mai-baap (guardian). In The Three Worlds of Welfare Capitalism (1990), Gosta-Esping Andersen argues that there are no welfare states without conditions. If the welfare measures are exiguous or of poor quality, then the privileged do not hesitate from approaching private service providers. In contrast, when social assistance is provided to those who ‘demonstrate’ the need for it, the beneficiaries must bear social stigma. Moreover, inefficiency in mapping mobile labour results in many migrant workers being omitted from receiving their share of social assistance.

The ongoing lockdown illustrates how migrant labour is commodified and dependent on capitalist market forces. A long chain of contractors, sub-contractors and petty bureaucrats stand between the government and the worker. In India, the relief measures announced by the central and state governments have been not only tardy but also grossly inadequate. A stark contrast is visible in case of professionals and students stranded abroad. Special flights and quarantine facilities are arranged for their repatriation, while poor migrant workers are forced to walk thousands of miles in scorching heat to return home. Class and caste are important factors that shape the interactions between the state and the people.

The Malaise of Modernity

Development and modernity cannot be studied in isolation. Rationality, reason, secularization, advancements in science and technology, and the capitalist mode of production are the features of contemporary modern societies. While Marx located the source of the problems of modern industrially advanced societies in capitalism, Weber attributed these to increasing rationalization and bureaucratization. As social interactions come to be governed by calculations and methodical procedures, we see the world trapped under an ‘iron cage of rationality’. It is astonishing how the industrially advanced Western countries could neither anticipate nor avert the spread of the contagion despite being home to the cream of the world’s research centres and institutions.

What unfurl before us are both the juggernaut of modernity as conceptualized by Anthony Giddens as well as Ulrich Beck’s ‘risk society’. As argued by the former, modernity has emerged as a potent force nearly impossible to tame. Further, the pandemic has exposed our risk societies wherein the central concern remains not inclusive development but the prevention, management and control of risk; in this case, that of mass contagion. Scientific communities all over the world are rushing to manufacture a vaccine against and cure for COVID-19, with little success so far. Even if a vaccine is discovered, its effective distribution will be a huge challenge given the inequalities of access.

The Development Conundrum

Development has been an uneven process with some developing at the cost of others. In The Myth of Development (1999), Vincent Tucker traces the beginning of the development discourse to the end of the Second World War (1939-1945). Proclaiming that it had achieved the highest level of economic and cultural evolution, the USA soon began urging the ‘left out’ countries to ‘catch up’. This process of catching up or ‘development’ was to be achieved at two levels – economic and intellectual. Backed by the might of rich and developed countries, international development agencies began providing loans and aid under the pretext of helping the ‘underdeveloped’ countries harness technologies and institutions for accelerating economic activity. Besides, Western educational institutions continued to strengthen their hegemony over knowledge production.

The post-War period witnessed rapid growth and expansion, especially in the two immediate decades from 1950-1970. But as J. R. McNeill notes in Something New Under the Sun (2000), this period also marked an uncontrolled experiment on the earth. Greed for cheap energy forced countries in perpetual conflict, a prominent example being the Gulf War of 1991. More subtly, the West defined the one-dimensional path of progress in culture and knowledge, education and politics, religion and community. Forcing the underdeveloped countries to follow the path charted by the developed countries without considering the unique historical experiences of the former gave rise to what A.G. Frank called the ‘development of underdevelopment’.

Pandemic and Biopolitics

The pandemic has legitimized what Foucault termed as biopower, or the mass control of bodies and populations. Science and technology have become indispensable tools for controlling nature and human thought. The state has established complete dominance over our lives through its various institutions, mainly bureaucracy and military. Instances of police brutality are surfacing every other day during the lockdown. Added to this is the power of technology which facilitates round-the-clock surveillance. The Indian government is trying to mandate the download of the Aarogya Setu contact-tracing application notwithstanding several apprehensions regarding violation of privacy.

Human life can scarcely remain untouched by larger socio-political processes and strategies. This crisis has endangered life itself, making biological life the object of power. The state emerges as the sovereign authority governing every aspect of our public as well as private lives during the pandemic. While the urban upper and middle classes can work from home and be safe inside their gated communities, migrant workers are left with neither work nor home. The logic of biopolitics considers some lives to be dispensable and less equal than others.

Critical questions

Be it for ‘improvement’ in the eighteenth century or for ‘development’ in the twentieth, natural resources and the poor have been exploited as means to greedy ends. In their scramble for development, the most powerful countries of the world have shown little regard for anything, be it the weaker countries or the environment. The COVID-19 pandemic has shaken our belief in the technology-empowered invincibility of human beings. Despite unparalleled advancements in medical science, millions are being infected by the novel coronavirus and thousands have lost their lives. Why are the most developed regions the worst affected? Are ecological disasters and diseases the dialectical repercussions of development?

Epidemics and pandemics have been a part of human history since ancient times. While  diseases such as smallpox and plague have been subdued, new infectious ones are emerging. Nevertheless, public health has not received the attention it deserves. The exoticization of diseases tends to dominate our daily discourse rather than holding our governments accountable for their structural failures.

Amartya Sen emphasized the instrumental as well as constitutive values of freedom in the conception of development. Freedom from hunger, morbidity and early mortality are not only instrumental to other freedoms, but also constitutive of the larger development project. Universal access to education and healthcare facilities promote general well-being and are pivotal to growth and development. The dominant idea of development rests on a paradoxical combination – more control (bureaucratic, technological and military) and less freedom. One  way to resolve the paradox is to heed Sen’s advice of development as freedom – to ensure substantial freedom through quality education, healthcare, political participation, and social security.

N.S Abhilasha is a PhD student at Indian Institute of Technology, Guwahati, India. She is interested in the environmental and social history of diseases.

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Economy

Rohingya Influx and its Economic Significance for Bangladesh

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Authors:Shuva Das & Sherajul Mustajib Sharif*

It is generally perceived that refugees are curse for host countries though the former often play positive roles for the latter. The context of Bangladesh over hosting Rohingya refugees is portrayed in such a way that demonstrates they are solely an obvious danger for the country in the areas of its economy, politics, environment, health, and security. The above argument is true but it is a one-sided view which is enough to make hospitable Bangladeshis hostile against the Rohingya. Thus, it is crucial to explore in which areas the Rohingya have made positive contributions in Bangladesh. In this article, we intend to elucidate the economic benefits offered by the displaced Rohingya for the host country.

Brief Overview of the Rohingya Crisis

The Rohingya crisis is one of the worst humanitarian disasters in the modern world. The degree of violence and persecution taken against the Rohingya by the military of Myanmar has reached in an extremely horrendous extent in which an UN fact finding team in 2018 found genocidal elements. The Rohingya are an ethno-religious Muslim minority group of Myanmar. Though they have lived in Rakhine state of the country for centuries, to the Burmese government and Buddhists they are illegal Bengali immigrants who came from the present Bangladesh to Rakhine State for works during British colonial rule. The Burmese government withdrew their citizenship status through the “1982 Citizenship Act”, rendering them stateless. Since 1978, they have experienced several brutal military crackdowns and every time they have taken shelter in Bangladesh. In particular, since 2017 when the military of Myanmar launched “clearance operation” against the Rohingya in retaliation of an insurgent attack allegedly carried out by a Rohingya rebel group known as the Arakan Rohingya Salvation Army on several police posts, a significant number of Rohingya, over 740,000, have fled to Bangladesh from Myanmar. This number with the previously remaining Rohingya refugees has exceeded the one-million mark in the host country, intensifying the level of strain on it.

Economic Advantages Offered by the Rohingya Refugees

Bangladesh is a small developing country and with a population of about 16.7 million, it is the world’s eighth most populous country. In these circumstances, over one additional million Rohingya refugees are competing with cheaper labor against many local people for jobs in the Rohingya-hosted areas in the Cox’s Bazar district of the nation, and they have put extreme pressure on its limited resources. Nonetheless, to graduate from the pool of the UN’s Least Developed Countries, with the massive refugee burden Bangladesh successfully accomplished all three required criteria in 2018 and is on track to be graduated by 2024. On an average, the real GDP growth of the country from 2017 to the running 2020 has also remained stable at around 7.70. The Rohingya influx has immense significance on the thriving economy of Bangladesh.

To begin with, Rohingya refugees have created numerous job opportunities for many Bangladeshi people who are working as volunteers, relief specialists, researchers, health workers and so on in almost 150 national and international aid groups and non-governmental organizations currently operating in Rohingya camps. In the United Nations High Commissioner for Refugees (UNHCR), for instance, more than 200 Bangladeshis have been employed to enhance its operational efficiency on the refugee crisis. Through working in humanitarian organizations, they are earning not only handsome salaries but quality skills. Besides, a good number of local people of the Rohingya-hosted areas in Bangladesh are doing transportation jobs to convey goods in the Rohingya camps.

Another vital point is that an entrepreneurial spark is currently seen among local host population. International donor agencies provide relief goods to Rohingya refugees who sell these to local traders to bring diversity in their daily meals. Local entrepreneurs purchase the relief products from Rohingya refugees at very low rate and sell these to their fellow Bangladeshis in a profitable price. Apart from this, the UNHCR took an ambitious project in 2019, under which 250 poor women of Cox’s Bazar along with equal number of Rohingya women have been given training in cloth crafting. And it has the will to train more women. Backward female population of Bangladesh can, in this manner, be empowered to be entrepreneurs, and effectively integrated into its booming economy.

Last but not least, International Organization for Migration, and the UN Food and Agriculture Organization in 2018 provided micro gardening kits to 25,000 Rohingya and 25,000 host households. This has opened a new economic window in South Eastern Bangladesh. To feed their gardens, the Rohingya purchase compost from Bangladeshi women. In addition to eating, they sell their produce in the host community market thereby generating a number of local vegetable dealers. The combined production of the Rohingya refugee and host families by micro gardening are enormously contributing to alleviate an estimated 50,000 metric ton yearly food deficit in Cox’s Bazar.

Concluding Remarks

Rohingya refugees have brought an economic boon for Bangladesh in multidimensional aspects. Because of them, many skilled and unskilled Bangladeshi people, especially women, have found their income sources. Positive contributions of the Rohingya should not be underestimated though these are less worthy if weighed against the overall drawbacks they have caused for the host nation. Since the Rohingya crisis is a protracted one having no possible certainty to be resolved soon, the government of Bangladesh needs not only to continue their diplomatic pressure against Myanmar but to focus on how effectively they can benefit from the displaced population in economic aspects.

*Sherajul Mustajib Sharif holds his BSS and MSS degrees from the Department of International Relations, University of Chittagong, Chittagong, Bangladesh.

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WTO’s ‘Crown Jewel’ Under Existential Crisis: Problem Explained

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World Trade Organization (WTO) is an international body that acts as a watchdog keeping an eye on the rules of trade between nations. WTO came into operation in 1995 and was founded as a successor to the General Agreement on Tariffs and Trade (GATT), which was incorporated in 1948. It acts as a forum where WTO members discuss and negotiate trade issues. Moreover, it works in the form of different multilateral as well as plurilateral WTO agreements. These agreements live at the heart of WTO as they deal with different aspects of trade policy.  Agreements like General Agreement on Trades and Tariffs; General Agreement on Trade in Services; The Agreement on Trade-Related Aspects of Intellectual Property Rights etc. forms the centerpiece of WTO.  Through these agreements, one WTO member enters into obligations and formulates the relation of reciprocity with the other WTO member.

Undeniably, the Dispute Settlement System (DSS) that works under the WTO is considered to be the ‘crown jewel’. No matter how stringent the laws are, unless they couldn’t be enforced, they are of not much worth. DSS functions as an effective mechanism to settle disputes and to enforce obligations in case of violation by any WTO member.  The ration d’etre of giving birth to DSS was to ensure settlement of disputes in a timely and structured manner.  DSS is committed to impede and further mitigate trade imbalances between stronger and weaker players by having their disputes to be settled on the verge of rules and not power. Since the day it came into force in 1995, 595 disputes have been brought before the DSS and out of which 350+ disputes are settled.

DSS is governed by the Dispute Settlement Body (DSB) through the rules incorporated in Disputes Settlement Understanding (DSU).  The DSS works as a two-tier redressal forum and is the most important and busiest international tribunal having a binding authority on the parties to the dispute once they adopt the report of findings. On the first level comes the Consultation as per Article 4 of the DSU rules. Article 4 states that “each WTO member undertakes to accord sympathetic consideration to and afford adequate opportunity for consultation regarding any representations made by another Member concerning measures affecting the operation of any covered agreement taken within the territory of the former.” Therefore, Consultation is mandatory before any dispute is addressed to DSB. Once the consultation is failed, the complaining party can request the DSB under Article 6 for the establishment of a panel body that shall aim to settle the disputes between the parties.

On the top of the hierarchy comes the appellate body which shall hear the appeal from panel cases. Any party to the dispute can formally notify DSB of its decision to appeal. Under Article 17 of the DSU rules, DSB shall establish a standing appellate body. Unlike the Panel body, the appellate body is a permanent body composed of seven persons out of which three shall serve on any one case. These members are appointed for a term of four years. It is the duty of DSB to ensure that the vacancies shall be filled as they arise so as to confirm the smooth and timely functioning of the hierarchical mechanism of dispute redressal. Principally, the decision under DSB is taken through consensus methodology. Article 2.4 of DSU explains this method stating that “the consensus is said to be achieved when no WTO member, present at the meeting, formally opposes to the proposed decision”.

The genesis of the crisis is attributable to the U.S. who through its non-consensus has blocked the selection procedure to fill the vacancies alarming in the Appellate Body. The minimum requirement for Appellate Body to function is at least three persons out of total strength of seven. However, on 11th December 2019, the term of two of the remaining three members came to an end. At present, the Appellate Body has only one member and thus, it is dysfunctional and the resolution mechanism has brought to a grinding halt. The political façade started long back in 2017 when the U.S. cleared its intention of not allowing the selection procedure to taken place in order to fill the vacancies in the Appellate Body. Nonetheless, the Appellate Body continued its function as the compositional requirement was manageable due to the tenure of three of its members remaining but ultimately the crisis knocked the doors of WTO in the last month of 2019.

Although, at present, the composition of the Panel Body has not been interjected and the process of addressing disputes through Panel Body is still in continuance. However, the problem is as per the trends, in 67 percent of the cases, one of the parties to the dispute appeals the finding of the panel body and thus; when the Appellate Body is itself dysfunctional, the order remains non-binding and the whole mechanism of the dispute resolution is disrupted severing the gravity of the political disaster. The reasons for the U.S. to block the normal functioning of the Appellate Body have been shared with other countries as well. Fortunately, no other country has repelled in the way the U.S. is exclaiming to address the loopholes. The dissatisfaction of the U.S. administration with the WTO is not a secret anymore when Mr. Donald Trump labeled the WTO as ‘disaster’ for their nation.

The reason for the U.S. to express dissatisfaction is because of the overreaching power that Appellate Body enjoys. To combat that, on a lighter note, the U.S. has shown a preference of going back to the non-binding dispute settlement system that was prevalent at the time of GATT, 1948. Ironically, it was the U.S. who during the Uruguay round of negotiations (1986-1994) pressured and voted for creating a dispute redressal system that is binding and enforceable, however as the tables have turned now and the Appellate Body has become an irksome affair for the U.S.

The central issue of the U.S. to cordon the appointment revolves around the problem ofjudicial overreach.  To elaborate the claim, the U.S. believes that the dispute settlement system interprets the WTO rules in such a way that instead of simplifying, it rather creates new obligations for the WTO members. What the U.S. believes is that the Appellate Body drifts away from its original mandate due to its practice of issuing decisions that either burden the WTO members with new obligations or diminishes the right they enjoyed earlier.

Further, the U.S. has raised the objections against the procedural irregularities by the Appellate Body. Entangling the issues of the procedure, firstly, the U.S.has pointed out the contradiction of the DSU rules adopted by the WTO members and the Appellate Body Working procedure which are drawn up by the Appellate Body itself. As per the Rule 15 of the latter, it allows the Appellate Body members to remain on board and to continue to serve on appeals which are pending during their terms; however, as per Article 17.9 of the former, a member enjoys the position for a fixed four-year term. Thus, the Appellate Body working procedures violate the provisional requirement as laid down in DSU rules.

The second procedural issue raised by the U.S. deals with the violation of completing the report by Appellate Body within the time frame of 90 days as prescribed by the DSU rules. The US has pointed out that the extraordinary delay violates the mandate of a speedy trial and further it negates the right of the complaining party as well as the party brought to dispute due to the hauling of their economies to a hiatus. It is the belief of the U.S. that the prospective incapacitation of the Appellate Body is undoubtedly a menace for the WTO and its members because once the report of panel body is appealed, it cannot be made enforceable unless the appellate body decides and thus, it holds the country for the indefinite timeframe not authorizing the party to retaliate on whose favour the panel body decided the dispute.

It is indisputable that the DSS need to undergo a series of reform in order to gain the lost confidence. Unfortunately, the step taken by the U.S. has been termed as harsh and politically motivated. One move of the U.S. has paralyzed the ability of the ‘crown jewel’ to resolve international trade disputes. Even going against the decision of the U.S. and outcasting the consensus power it holds won’t serve the purpose as the U.S. is an important player of WTO and if the U.S. is not a party to it; the WTO would be synonymous to a toothless tiger. 

Nevertheless, arbitration under Article 25 of the DSU rules can act as an alternative to the hierarchal redressal system, as well as, solving disputes through bilateral agreements can be another alternative during the time of this existential crisis. The proposed idea of forming a Multi-party Interim Appellate arrangement will not succumb for long because the U.S. will not be its part and as it is certain, U.S. forms a considerable part of international trade, thus, there will again be a situation of deadlock. Moreover, choosing such interim mechanisms for the long run can raise a threat to the uniformity of rulings that WTO embraces. All in all, WTO is currently under jeopardy and it can be the beginning of the end if a solution to the crisis is not found in a timely manner. As of now, the Supreme Court of the international Trade ceases to exist and is in a life or death moment.

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How Local Governments in China can Utilize New Infrastructure Policy to Promote Development

Chan Kung

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Authors: Chan Kung and Wei Hongxu*

In an effort to promote economic recovery, the central government, local governments, and enterprises have placed high expectations on the investment of new infrastructure, hoping it would promote the development of the digital economy, so as to enhance the internal driving force of economic development. Especially when the scale of local special bonds is expected to be increased and again issued ahead of schedule, many local governments hope to seize the opportunity of digital economy development and increase investment in new infrastructure areas to drive regional economic development. Unlike the conventional economy and conventional infrastructure investment, the new infrastructure is not a simple way to boost investment, but rather to help the conventional industries realize digital and intelligent transformation as soon as possible, and to create new consumption, new manufacturing, and new services. While the new infrastructure investment brings a new economic model, it is different from the past in terms of content, mode, and financing channels. It requires local governments to make corresponding changes with market-oriented thinking.

New infrastructure investment is not only the demand side of local users, but also the supply side of technology investment. From the perspective of the scope of new infrastructure, new infrastructure projects include 5G base stations, ultra-high voltage (UHV) electricity, industrial Internet, intercity high-speed railway, intercity rail transit, new energy vehicle charging piles, artificial intelligence, and Big Data centers. At present, rail transit and new energy infrastructure are not much different from conventional infrastructure investment. The degree of local participation of UHV electricity is limited, while the investment in other aspects, such as 5G base stations and Big Data centers, is relatively mature in technology and has good market supply capacity. In other aspects, it is more necessary to start from the aspects of technology research and industrial cultivation, and to invest in projects that encourage innovation and industrial park construction. Therefore, this requires not only clear investment objectives on the demand side, but also needs to expand the supply side such as technology research and application at the same time, which undoubtedly increases the complexity of new infrastructure investment.

At the same time, the sources and financing channels of new infrastructure investment still need to be explored. Recently, local governments in China have begun planning to finance new infrastructure projects through issuing special bonds, and many local governments have put new infrastructure projects on their agenda. Some market analysts believe that at present, 5G is still mainly invested in base stations. Generally, telecommunications companies such as China Unicom and Mobile Communications can invest on their own without issuing special bonds, thereby the special bonds can be invested in projects related to data centers. However, such projects are only available in first-tier cities, and there are not many such projects in second-tier, third-tier, fourth-tier, and fifth-tier cities. New infrastructure projects should be more market-driven and local governments should avoid excessive involvement via direct investment in industrial projects. Local governments also need to promote the public-private partnership (PPP) model and introduce more social capital to improve efficiency and broaden financing sources.

Even for new infrastructure projects funded by special bonds, attention should be paid to the financing capacity of the projects to avoid adding to the financial burden. There are two main ideas for the new infrastructure special bond declaration projects in many provinces. One is to build a digital information application platform at the county and district level based on the resources of the provincial and municipal cloud platforms. The second is to promote the optimization and upgrading of conventional infrastructure projects with the theme of digital and wisdom. Some local finance people worry that many of these projects are packaged around the concept of “new infrastructure” and are mostly non-yielding or low-yielding projects that may require the government to cover future bond payments. Therefore, the special bond for new infrastructure construction should be invested in public welfare projects that can generate income, rather than public welfare projects that do not.

At the same time, there are new requirements for investment entities in new infrastructure investment. Some financial institutions said that after the issuance of new infrastructure special bonds, most of them will eventually be invested in local urban projects. However, local urban projects were good at conventional infrastructure construction, unfamiliar with new infrastructure construction, and lacks experience in new infrastructure project operation. If we speed up the construction of new infrastructure projects without considering the actual situation, it will easily lead to the mismatch between the capacity and the project requirements, and drag on the development of local governments and enterprises. In particular, unlike conventional investment in forming fixed assets, a considerable part of new infrastructure investment in research, personnel training, and other forms of intangible assets will be formed. The conventional urban investment model does not have the ability to use and dispose of these assets. At the same time, the large amount of hardware equipment invested in the new infrastructure is different from the conventional “iron and steel foundation”. Its wear and tear, operation, and upgrading all require continuous follow-up investment, which cannot be “invested all at once.” These are also not available in some conventional urban investment enterprises. If the local government cultivates and supports relevant enterprises by means of industrial investment, it needs more consideration in terms of income distribution and asset management. Such investment cannot be simply measured by the unit of land and capital, but more in the form of equity investment such as industrial funds and venture capital. In this respect, the local government needs to have the investment entities and relevant personnel with the ability to invest in relevant industries.

Different from the past, local governments need to play their roles in market construction and maintenance, investment entities, and end-users in promoting new infrastructure investment and the development of the digital economy. In the cultivation of the digital market, market demand, and the maintenance of the market order, local governments should play the role as a supervisor, take the development of the market as the guide, and develop the local digital market. In terms of investment, it is necessary to start with basic research and development and personnel training, promote market-oriented investment and technological innovation to enhance the competitiveness of the digital industry. In terms of end-users, it is necessary to integrate their own digital resources, establish a public digital space, and expand digital demand with the digital transformation of public services and government affairs as the direction. These three new roles are the basic problems to be solved in the process of promoting new infrastructure.

While much attention has been paid to new infrastructure, the reality is that, in terms of overall size, it needs to be recognized that infrastructure investment is still dominated by conventional infrastructure projects, with new infrastructure as defined by the market accounting for less than 15%. ANBOUND is not a proponent of separating infrastructure from the old and the new, so one cannot fully “bet” on new infrastructure to revive the post-pandemic economy. From the perspective of economic development trends and current reality, the role of new infrastructure is to promote the coordinated and integrated development of digital technology to industry and regional economy. Therefore, local governments need to make good use of fiscal expansion policies and financing tools to build new infrastructure, rather than investing for investment’s sake, they need to pay attention to the trend of economic digitization and promote the market efficiency and the expansion of market space.

Final analysis conclusion:

Promoting economic recovery and the development of the digital economy with new infrastructure are the keys to current macro policies. In this regard, local governments need to pay attention to the differences between the new infrastructure and the conventional infrastructure model, and they need to make corresponding adjustments in the investment model and development thinking so as to give full play to the efficiency of the digital economy.

*Wei Hongxu, graduated from the School of Mathematics of Peking University with a Ph.D. in Economics from the University of Birmingham, UK in 2010 and is a researcher at Anbound Consulting, an independent think tank with headquarters in Beijing. Established in 1993, Anbound

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