The COVID-19 pandemic, which has been ongoing for most of 2020, has had a significant impact on human life.Apart from infecting more than 10 million people and killing 1 Million people worldwide as of today as of this writing (28 October 2020), Initially in the pre-pandemic COVID-19, the world economy is projected to increase 0.4 percent to 3.3 percentin 2020 which was previously 2.9 percent in 2019. Then after the pandemic hit, world economic growth fell to -4.4 percent in 2020 as a result, the COVID-19 pandemic has devastated the global economy.The public health crisis due to the COVID-19 pandemic has led to an economic recession that has the potential to trigger a political and social crisis if not handled properly.
The economic recession caused by the COVID-19 pandemic was caused by many businesses closing or reducing their activities to avoid further transmission. As a result, the chain of economic activities such as production, distribution, and consumption is disrupted and results in an economic recession and the number of workers or employees being laid off to reduce production costs, this has resulted in high unemployment and low public consumption because people have to save their expenses considering that the majority have lost their jobs. due to termination of employment as the main source of income.
The impact of the economic recession due to the pandemic that hit all regional regions in the world, including Southeast Asia or ASEAN. Before the pandemic hit, the economy in ASEAN was predicted to grow by 4.7 percent based on an ADB report published in December 2019. Then when COVID-19 was declared a global pandemic, economic growth was only 1.0 percent. This is due to a large number of MSMEs (Small and Medium Enterprises) as the backbone of the economy in ASEAN. MSMEs are the largest contributor to the percentage of GDP and employment for each of its member countries. The results of research on six ASEAN member countries (Indonesia, Thailand, Singapore, Malaysia, and Brunei Darussalam) show that MSMEs contribute more than 50 percent of employment and contribute to GDP ranging from more than 30 to 50 percent per year. This shows how important the role of MSMEs is as the backbone of the economy in ASEAN.
MSMEs have limited capital and production capacity so that when the country experiences a recession due to a pandemic, MSMEs also reduce their production output because little or nothing buys their products. After all, consumers reduce their spending more to prioritize buying necessities, as a result, the profit margin is smaller and only can cover production and operational costs. To overcome this, MSME owners reduce their production output and lay off workers or employees which results in increased unemployment, owners will go out of business if these methods are not able to increase the margin of sales results with production costs. Termination of employment for MSME workers because their places of work are out of business or doing efficiency to reduce operational costs has contributed greatly to the high number of new unemployment, for example, the number of newly unemployed in Indonesia reached 9.77 million in August 2020, this number increased by 2.67 million people compared to the same period last year.
Many ASEAN member countries have realized how important the sustainability of MSMEs,and then strengthening their economic resilience because MSMEs contribute to GDP and large absorption of fields. Various short-term stimulus measures have been taken to save MSMEs amid a pandemic have been carried out by all member countries such as extension or postponement of tax reporting deadlines, direct financial assistance such as facilitating the provision of soft capital loans and providing wage subsidies or incentives for MSME employees and owners. Currently, the most important thing is implementing long-term structural steps to maintain the sustainability of MSMEs in the midst of implementing a new life order (new normal) that changes the lifestyle of the consumer community in the post-pandemic. Structural measures require collective effort for all ASEAN member countries because they change the overall structure of MSMEs to go hand in hand with changes in the lifestyle of the consumer society.
THE IMPORTANCE OF UMKM DIGITALIZATION FOR THE ECONOMY
Strengthening MSMEs cannot be separated from the implementation of SDG (Sustainable Development Goals) or Sustainable Development Goal 8 (eight), namely, promoting sustainable, inclusive economic growth and providing full and productive employment opportunities for all people. The presence of MSMEs expands economic goals, which is increasing the number of jobs. The addition of the number of new jobs by MSMEs provides benefits for the poor and vulnerable to get out of poverty and has an impact on increasing community income which brings success in achieving the first SDGs (eradicating poverty), second (ending hunger), fifth (gender equality), eighth itself, and ninth (increasing industrialization and sustainable innovation).
The results of research conducted by Mckinsey & Company suggest long-term steps that need to be taken by policymakers to prepare and encourage MSMEs to rise again. One of the long-term steps that need to be taken is to prepare MSMEs to implement digitalization in carrying out their economic activities again. This step needs to be taken because the COVID-19 pandemic has forced all businesses to close their physical facilities which are the center of their economic activity and online channels are the only way for MSMEs to survive amid limited physical activity to reduce the number of transmissions. The importance of digitalization for MSMEs to increase their income is evidenced by a survey from Mckinsey in 2018 showing 60 to 95 percent of digital income reaches 10 percent of all the largest corporate sectors. If MSMEs take into account a significant share of the region’s economic activity, this means that increased digital capabilities will also have an impact on increasing income.
The effort to digitize MSMEs to be able to adapt in the era of a new life order also faces many challenges. The challenges that must be faced in realizing digitalization include access to supporting infrastructures such as electricity supply, communication and information technology, and adequate internet access, which are very important in the effort to digitize MSMEs. Also, mastery of technology and information capabilities for human resources is something that needs to be considered because digitization and automation applied to all types of businesses including MSMEs can make many people lose their jobs, for ASEAN member countries there will be 878 thousand new unemployed in Malaysia; 4.5 million in the Philippines; 9.5 million in Indonesia; and 2.4 million people in Thailand. The solution to overcoming this problem is to facilitate new job skills training for job seekers and victims of layoffs (termination of employment) and increase funding and collaborate with companies engaged in technology and information to make this happen.
ASEAN STRATEGY IN DIGITALIZING MSMES IN SOUTHEAST ASIA
Increasing digital capabilities or digitizing MSMEs is also a major concern for ASEAN which was emphasized at the ASEAN + 3 Summit (China, Japan, and South Korea) and the ASEAN Economic Ministerial Meeting. At the 37th ASEAN Summit in Vietnam on November 12, 2020, all ASEAN member countries agreed to launch the ASEAN Comprehensive Recovery Framework (ACRF). The ACRF aims as a coordinated ASEAN strategy that focuses on restoring the critical sectors and vulnerable groups most affected by the pandemic and identifying what actions should be taken in line with regional and sectoral priorities. ASEAN’s attention to the importance of increasing digital capabilities or digitizing MSMEs is reflected in the fourth ACRF strategy which focuses on accelerating inclusive digital transformation and is included in key priorities, namely, providing an online platform and implementing policies related to enhancing digital capabilities. Not only that, improving connectivity is a key priority related to digitizing MSMEs by providing supporting infrastructure and an affordable internet network. Besides, the launch of the ACRF at the 37th ASEAN Summit is an implementation of the 16th SDG which emphasizes international cooperation and an institutional framework in realizing sustainable development. The highest political forum such as a high-level conference (Summit) is a forum that provides political leadership, collective guidance, and recommendations in realizing sustainable development.
To realizing the strategy in these key priorities, there are 3 (three) stages, namely reopening, recovery, and resilience. The reopening stage, namely ACCMSME (ASEAN Coordinating Committee of Micro, Small, and Medium Enterprise) as an agency in ASEAN that coordinates MSME empowerment agencies in ASEAN member countries, conducts in-depth assessments to identify challenges and policy recommendations to support awareness of technology adoption and relevant digital tools among MSMEs; And supporting the integration of MSMEs into global value chains, including establishing mechanisms to help MSMEs increase exports. The identification results report will be followed by policy recommendations for improving the digital capabilities of MSMEs for ASEAN member countries and special recommendations for less developed member countries such as Cambodia, Laos, Myanmar, and Vietnam (CLMV) to get assistance from the IAI (Initiative for ASEAN Integration).
In the recovery and resilient stages, ACCMSME will increase the amount and quality of relevant content in the ASEAN SME Academy. The ASEAN SME Academy is an online media portal for digital skills training for MSMEs launched by the US – ASEAN Business Council in collaboration with USAID (United States Agency for International Development) in March 2014. The ASEAN SME Academy aims to provide free training for MSMEs in ASEAN to improve access to financial products, global and regional markets, information services and business input, and technology and innovation. The training content and information in the ASEAN SME Academy are designed by Forbes 500 listed companies such as Google, Cisco, SAP, and HP. Currently, the ASEAN SME Academy is managed by ACCMSME and its presence will be more useful by improvising the amount and quality of content and translating the training content in it into local languages so that it can be accessed by all groups and target more users as the implementation of ACRF’s fourth strategy.
In addition to the improvised development of the ASEAN SME Academy, ACCMSME has also launched the ASEAN Go Digital program in June 2020. This program is a collaboration between ACCMSME and The Asia Foundation and Google. The main objective of this program is to improve information and communication technology capabilities for MSME owners to increase their productivity and individuals who do not have permanent jobs to participate in the digital economy and help senior stakeholders understand the potential of MSMEs in the digital era. The targets of this program are 200 thousand farmers, agricultural cooperatives, home handicraft producers, and owners of other traditional businesses, totaling 200 thousand people across ASEAN. In carrying out this program, ACCMSME has coordinated with its partners consisting of non-governmental organizations (NGOs) and government organizations in various ASEAN member countries. The Asia Foundation being the main partner of ACCMSME has a role to play in tailoring the training program so that it meets the needs of each country and suits the local context, and works closely with teams of local technology professionals and volunteers in providing training. Realizing the digitization of MSMEs requires adequate supporting information and communication technology infrastructure, namely the internet. Bearing in mind the low internet penetration in several ASEAN member countries such as Cambodia, Laos, and Myanmar, it has created inequality among member countries. To overcome this, ASEAN through the ASEAN Digital Senior Officials Meeting (ADGSOM) or the ASEAN Communication and Digital Ministers Meeting and the ASEAN Telecommunication Regulators Council (ATRC) or the ASEAN Telecommunication Regulatory Council will coordinate each of the telecommunications and digital ministries of member countries in implementing efforts to increase internet penetration in rural and remote areas with the new Universal Service Obligation framework (USO 2.0). Also, to ensure internet affordability for all, ADGSOM and ATRC have prepared a regional policy framework in providing transparent and affordable international roaming services.
Empowering MSMEs through increasing digital capabilities is an important priority for ASEAN in its efforts to restore the economies of member countries because MSMEs are the backbone for almost all ASEAN member countries. The impact of the COVID-19 pandemic, which has changed the way of life of all people around the world, has made MSMEs have to adapt to maintain their business continuity. Therefore, structural handling is needed in maintaining the continuity of MSMEs as the backbone of the economy, such as cooperation at the regional level such as ASEAN as a forum for cooperation and collective action for member countries in the Southeast Asia region. The policy framework that was launched based on consensus at the 37th ASEAN Summit became a guide for ASEAN agencies related to MSMEs (ACCMSME) and digital connectivity (ADGSOM and ATRC) in coordinating government agencies of each member country involved in increasing digital capacity and digital connectivity infrastructure who supports it. This shows that ASEAN has implemented the 16th SDG which emphasizes international cooperation in realizing development, namely increasing the digital capabilities of MSMEs which are closely related to SDG 8 which promotes inclusive economic growth, and MSMEs are a means of expanding employment opportunities for the poor which are closely related to growth. an economy that is inclusive or has an impact on the people.
Carbon Market Could Drive Climate Action
Authors: Martin Raiser, Sebastian Eckardt, Giovanni Ruta*
Trading commenced on China’s national emissions trading system (ETS) on Friday. With a trading volume of about 4 billion tons of carbon dioxide or roughly 12 percent of the total global CO2 emissions, the ETS is now the world’s largest carbon market.
While the traded emission volume is large, the first trading day opened, as expected, with a relatively modest price of 48 yuan ($7.4) per ton of CO2. Though this is higher than the global average, which is about $2 per ton, it is much lower than carbon prices in the European Union market where the cost per ton of CO2 recently exceeded $50.
Large volume but low price
The ETS has the potential to play an important role in achieving, and accelerating China’s long-term climate goals — of peaking emissions before 2030 and achieving carbon neutrality before 2060. Under the plan, about 2,200 of China’s largest coal and gas-fired power plants have been allocated free emission rights based on their historical emissions, power output and carbon intensity.
Facilities that cut emissions quickly will be able to sell excess allowances for a profit, while those that exceed their initial allowance will have to pay to purchase additional emission rights or pay a fine. Putting a price tag on CO2 emissions will promote investment in low-carbon technologies and equipment, while carbon trading will ensure emissions are first cut where it is least costly, minimizing abatement costs. This sounds plain and simple, but it will take time for the market to develop and meaningfully contribute to emission reductions.
The initial phase of market development is focused on building credible emissions disclosure and verification systems — the basic infrastructure of any functioning carbon market — encouraging facilities to accurately monitor and report their emissions rather than constraining them. Consequently, allocations given to power companies have been relatively generous, and are tied to power output rather than being set at absolute levels.
Also, the requirements of each individual facility to obtain additional emission rights are capped at 20 percent above the initial allowance and fines for non-compliance are relatively low. This means carbon prices initially are likely to remain relatively low, mitigating the immediate financial impact on power producers and giving them time to adjust.
For carbon trading to develop into a significant policy tool, total emissions and individual allowances will need to tighten over time. Estimates by Tsinghua University suggest that carbon prices will need to be raised to $300-$350 per ton by 2060 to achieve carbon neutrality. And our research at the World Bank suggest a broadly applied carbon price of $50 could help reduce China’s CO2 emissions by almost 25 percent compared with business as usual over the coming decade, while also significantly contributing to reduced air pollution.
Communicating a predictable path for annual emission cap reductions will allow power producers to factor future carbon price increases into their investment decisions today. In addition, experience from the longest-established EU market shows that there are benefits to smoothing out cyclical fluctuations in demand.
For example, carbon emissions naturally decline during periods of lower economic activity. In order to prevent this from affecting carbon prices, the EU introduced a stability reserve mechanism in 2019 to reduce the surplus of allowances and stabilize prices in the market.
Besides, to facilitate the energy transition away from coal, allowances would eventually need to be set at an absolute, mass-based level, which is applied uniformly to all types of power plants — as is done in the EU and other carbon markets.
The current carbon-intensity based allocation mechanism encourages improving efficiency in existing coal power plants and is intended to safeguard reliable energy supply, but it creates few incentives for power producers to divest away from coal.
The effectiveness of the ETS in creating appropriate price incentives would be further enhanced if combined with deeper structural reforms in power markets to allow competitive renewable energy to gain market share.
As the market develops, carbon pricing should become an economy-wide instrument. The power sector accounts for about 30 percent of carbon emissions, but to meet China’s climate goals, mitigation actions are needed in all sectors of the economy. Indeed, the authorities plan to expand the ETS to petro-chemicals, steel and other heavy industries over time.
In other carbon intensive sectors, such as transport, agriculture and construction, emissions trading will be technically challenging because monitoring and verification of emissions is difficult. Faced with similar challenges, several EU member states have introduced complementary carbon taxes applied to sectors not covered by an ETS. Such carbon excise taxes are a relatively simple and efficient instrument, charged in proportion to the carbon content of fuel and a set carbon price.
Finally, while free allowances are still given to some sectors in the EU and other more mature national carbon markets, the majority of initial annual emission rights are auctioned off. This not only ensures consistent market-based price signals, but generates public revenue that can be recycled back into the economy to subsidize abatement costs, offset negative social impacts or rebalance the tax mix by cutting taxes on labor, general consumption or profits.
So far, China’s carbon reduction efforts have relied largely on regulations and administrative targets. Friday’s launch of the national ETS has laid the foundation for a more market-based policy approach. If deployed effectively, China’s carbon market will create powerful incentives to stimulate investment and innovation, accelerate the retirement of less-efficient coal-fired plants, drive down the cost of emission reduction, while generating resources to finance the transition to a low-carbon economy.
(Martin Raiser is the World Bank country director for China, Sebastian Eckardt is the World Bank’s lead economist for China, and Giovanni Ruta is a lead environmental economist of the World Bank.)
(first published on China Daily via World Bank)
The EU wants to cut emissions, Bulgaria and Eastern Europe will bear the price
In the last few years, the European Union has been going above and beyond in dealing with climate change. Clearly, this is far from being a case of disinterested endeavour to safeguard the planet and the environment. On the contrary, the EU’s efforts aim at reinforcing its “normative power”. In effect, the EU has gained some clout on the international stage, even vis-à-vis faraway countries like Vietnam and China. Yet, in doing so the Union embroiled in the apparent rush for more and more ambitious climate standards and targets. Therefore, Brussels needs to start acting and deliver on its promises to keep staying ahead of the pack. Even more so given US President Biden’s strengthened engagement with friends and foes alike on the climate and human rights.
Last week, the European Commission manifested its acknowledgment of this need by unveiling the Fit for 55 (FF55) growth strategy. Overall, this new, beefed-up Green Deal should reduce greenhouse gas emissions to 55% of their 1990 level by 2030. In some analysts’ view, the FF55 plan is a game changer in the long-term race towards climate neutrality alas. In fact, it could “both deepen and broaden the decarbonisation of Europe’s economy to achieve climate neutrality by 2050.” Moreover, they expect the FF55’s 13 measures to generate a number of positive ripple effects across EU economies.
True, wanting to reduce greenhouse gases significantly by 2030 and reaching net-zero-emission by 2050 goal is commendable under many regards. Still, the FF55 includes a number of measures that could impact ordinary people’s life massively across Europe. Nevertheless, the 27 Member States of the EU are responsible for as little as 8% of global emissions. As such, it is necessary to take a deeper look at how the FF55 will affect different countries and demographics.
The transition’s social cost
The realisation that reduction of capitalism’s dependence on fossil fuels will have serious socio-economic consequences is not at all new. Contrariwise, scholars and politicians have been outspoken about an indisputable “conflict between jobs and the environment”, since the early 1990s. Together, the pandemic-induced recession and the signing of the Paris Accord have brought the notion back on the centre stage.
Factually, pushing the energy transition entails facing mass lay-offs, generalised workforce retraining and taxes hikes on ordinary consumers. For instance, these hardships’ seriousness is evident in the progressive abandonment of coal mining for energy generation in the US. Moreover, the energy transition requires strong popular backing in order to be effective. Yet, measures pursued to achieve environmentally friendly growth tend to generate strong, grassroot opposition. Most recently, France’s gilets jaunes protests shows that environmental policies generate social discontent by disfavouring middle and lower classes disproportionately.
The poorest families and countries will bear the costs
One of the FF55’s main policy innovation regards the creation of a carbon trading market for previously exempt sectors. Namely, companies working int the transport and buildings sectors, be they public or private, will have to follow new rules. As it happened in the energy industry before, each company will have to respect a “carbon allowance”. Basically, it is an ‘authorisation to pollute’ which companies can buy from each other — but the total cannot increase. Despite all claims of just transition, this and other measures will have a gigantic, re-distributional effect within and between countries. And it will be of markedly regressive character, meaning that poorer families and countries will pay more.
Taxing transport emission is regressive
Historically, these sectors were trailing behind most others when it comes to decarbonisation for a variety of reasons. First of all, the previous emission trading system did not include them. Moreover, these are far from being well-functioning markets. As a result, even if the cost of emissions was to rise, enterprises and consumer will not react as expected.
Thus, even as they face higher costs, companies will keep utilising older, traditional vehicle and construction technologies. With taunting reverberations on those poorer consumers, who cannot afford to buy an electric car or stop using public transport. Hence, they “will face a higher carbon price while locked into fossil-fuel-based systems with limited alternatives.” Moreover, the EU could worsen these effects by trying to reduce the emission fees on truck-transported goods. Indeed, the commission is proposing a weight-based emission standard that would collaterally favour SUVs over smaller combustion-engine car and motorbikes.
In a nutshell, higher taxes and fee will strike lower-class consumers, who spend more of their incomes for transportation. Even assuming these households would like to switch to low-emission cars and buildings, current market prices will make it impossible. In fact, all these technologies ten to have low usage costs, but very high costs of acquisition. For instance, the cheapest Tesla sells at over €95,000, whereas a Dacia Sandero “starts at just under €7,000.”
Eastern Europe may not be willing to pay
At this point, it is clear that the FF55 plan will deal a blow to ongoing efforts to reduce inequalities. In addition, one should not forget that EU Member States are as different amongst them as they are within themselves. Yet, the EU is not simply going to tax carbon in sectors that inevitably expose poorer consumers the most. But in doing so it would impose a single price on 27 very diverse societies and economies. Thus, the paradox of having the poorest countries in the EU (i.e., Central- and South-Eastern Europe) pay the FF55’s bill.
To substantiate this claim, one needs to look no further than at a few publicly available data. First, as Figure 2 shows, there is an inverse relation between a country’s wealth and consumers’ expenditures on transport services. Thus, not only do poorer people across the EU spend more on transport, poorer countries do as well. Hence, under the FF55, Bulgarians, Croatians, Romanians and Poles will pay most of the fees and taxes on carbon emission.
Additionally, one should consider that there is also a strict inverse relation between carbon emissions and the minimum national wage. In fact, looking at Figure 3 one sees that countries with lower minimum wages tend to emit more carbon dioxide. On average, countries with a minimum salary of €1 lower emit almost 4.5mln tonnes of carbon dioxide more. But differences in statutory national wages explain almost 32% of the cross-country variation in emissions. So, 1.5 of those extra tonnes are somehow related to lower minimum salaries and, therefore, lower living standards.
The EU’s quest for a just transition: Redistribution or trickle down?
Hence, the pursual of a ‘just’ transitionhas come to mean ensuring quality jobs emerge from these economic changes. However, many of the FF55’s 13 initiatives may worsen disparities both within countries and, more importantly, between them. Thus, the EU has been trying to pre-empt the social losses that would inevitably come about.
From the Just Transition Fund to the Climate Social Fund
In this regard, the European Union went a step forward most countries by creating the Just Transition Fund in May. That is, the EU decided to finance a mix of grants and public-sector loans which aims to provide support to territories facing serious socio-economic challenges arising from the transition towards climate neutrality [… and] facilitate the implementation of the European Green Deal, which aims to make the EU climate-neutral by 2050.
Along these lines, the FF55 introduces a Climate Social Fund (CSF) that will provide “funding […] to support vulnerable European citizens.” The fund will provide over €70bln to support energy investments, and provide direct income support for vulnerable households. The revenues from the selling of carbon allowances to the transport and building sectors should fund most of the CSF. If necessary, the Member States will provide the missing portion.
The EU Commission may give the impression of having design the CSF to favour poorer households and countries. However, it may actually be a false impression. In fact, it is clear that the entire carbon pricing initiative will impact poorer household and countries more strongly. However, only a fourth of the carbon pricing system’s revenues will go to fund the CSF. The remaining portion will finance other FF55 programmes, most of which have a negative impact on poorer communities. Thus, despite the CSF, the final effect of the entire FF55 will be a net redistribution upwards.
Stopping a redistribution to the top
Nevertheless, there is a way to fix the FF55 so that it can work for poorer households and lower-income countries. Given that the CSF is too small for the challenge it should overcome, its total amount should be increased. In fact, the purpose of higher carbon pricing is in any event not to raise revenue but to direct market behaviour towards low-carbon technologies—there is thus a strong argument for redistributing fully the additional revenues.
Hence, the largest, politically sustainable share of carbon-pricing revenues from transportation and housing should ideally go to the CSF. In addition, the Commission should remove all the proposed provision that divert CSF money away from social compensation scheme. In fact, poorer families will not gain enough from subsidies to electric car, charging stations and the decarbonisation of housing. One contrary, “using the fund to support electric vehicles would disproportionally favour rich households.”
Finally, the allocation of CSF money to various member states should follow rather different criteria from the current ones. In fact, the Commission already intends to consider a number of important such as: total population and its non-urban share; per capita, gross, national income; share of vulnerable households; and emissions due to fuel combustion per household. But these efforts to look out for the weakest strata in each country could backfire. In fact, according to some calculations, a Member State with lower average wealth and lower “within-country inequality could end up benefiting less than a rich member state with high inequality.”
A number of well-known, respected economist have been arguing that environmental policies should account for social fallouts attentively. Goals such as emission reduction and net-zero economies require strong popular support in order for the transformation to succeed. Or at least, the acquiescence of a majority of the public. Otherwise, the plans of well-intentioned and opportunistic governments alike will derail. After all, this is the main lesson of the currently widespread protest against the mandating of ‘Covid passes’ and vaccines.
If the FF55 will deal poorer households a devastating blow, social unrest may worsen — fast. But as long as it will also hurt Eastern European countries as a whole, there is a chance. Hopefully, European parliamentarians from riotous Hungary or Poland will oppose the FF55 in its current shape. Perhaps, in a few years everyone will be thankful for these two countries strenuous resistance to EU bureaucracy. Or else, richer countries may force Central- and South-Eastern Europe to swallow a bitter medicine. Even though, whatever happens, Europe alone cannot and will not save the planet.
Entrepreneurialism & Digitalization: Recovery of Midsize Business Economies
Observe nations around the world, especially those with the largest numbers of IT professionals, rich and well-groomed government departments and their related agencies, with matured bureaucracies and unlimited numbers of computers but still no signs of thriving digital economies buzzing on global platforms. What is so mysterious about digitization of small medium businesses, smoothly leading to ‘virtualization of economies’ creating global bounce of trade? Well, it is surrendering to the realization that entrepreneurialism is the main driving engine of such challenges and not the herds of IT teams, deluxe bureaucracies and accountancy-mindsets.
What is a digital economy? It is definitely not when all businesses have websites and are all doing social media postings, at the outset understanding digitalization of a single enterprise is already a fine art, and to make it fly on global trade platforms is a science. Unless economic development teams can articulate, what is and how ‘virtualization of economies’ work, uplift and upskill vertical trade sectors and create an entrepreneurial bounce of trades’, the entire exercise of digitization might as well leave to early video game players or early grader IT personnel. Observe how The Silicon Valley and e-Commerce revolutions of the world never created by large IT teams, but categorically by “techie-entrepreneurs” of the day that in turn occupied millions of IT professionals and created hundreds of millions IT experts driving e-commerce of today. Of course, IT teams needed but in very reverse order.
Why is the digital economy an entrepreneurial economy? Digitization of the economy is simply not an IT exercise rather a strategic entrepreneurial maneuver of placing a midsize business economy on wheels using easily available digital platforms with abundance of software to choose from to make right entrepreneurial-based decisions to create creative bounce. The survival strategies for the post pandemic economies have less to do with accountancy-mindsets and bureaucratic attitudes, as it is all about entrepreneurial global age execution with superior digital performances.
Calling Entrepreneurial Business Mindsets: The new horizons beyond pandemic call for “simultaneous synchronization” a need to merge ‘mental-blocks’ the lingering ‘productivity-silos’ ‘digital-divides’ ‘mental-divides’ all such negative forces balanced with positive forces of ‘innovative excellence’ and ‘superior-performance’ thrown all in an entrepreneurial-blender to make a great progressive multi-flavored shakes. To mix and match with our realty checks of today and the blended calamites; Economy + SME + MFG + AI + VR + AR + Officeless + Remote + Occupationalism + Globalization + Exports + Upskilling, all in one single sandbox need progressive advancements with entrepreneurial guts and clarity of vision for any serious stable economic balance. If such were a monopoly game, printing of currency would be the norm.
National Mobilization of Entrepreneurialism: Needed are deep studies of the prolonged trajectory of entrepreneurial intellectualism spanning a millennia… the word ‘entrepreneurialism’ was only invented over a century ago… but our civilization was built on similar principles, driven and strong people. Declare an economic revolution as a critical cure to desolate periods and call the nation but will they listen? With credibility of institution and political promises tanked, audible to the populace now is the grind of mobilizations, thundering deployments of action packed strategies, but how do you fund them? National mobilization of entrepreneurialism is the hidden pulse of the nation, often not new funding dependent rather execution hungry and leadership starved, so what makes it spin? Entrepreneurial warriors
As if a silent revolution mobilized, the nouveau entrepreneurialism in post pandemic economy in action, where talents on wings of digitalization, flying on trading platforms, visible in smart data and shining amongst upskilled midsize economies. Lack of upskilling, lack of global-age expertise, and most importantly lack of entrepreneurialism is what keeps digitization of economies lost in the past. How naïve is it to believe post-pandemic economic issues some PR singsong election campaigns? Only deployment, execution, mobilization will be the message now acceptable by the billions displaced, replaced and misplaced workers, but what is stopping nations, their Ministries and trade groups to have all out discussions and table immediate action plans? Ouch, do not forget the entrepreneurial blood in the economic streams, exciting the bureaucracies and accountancy-mindsets. The next 100 elections over the coming 500 days will be full of surprises, but serious transformation for survival is inevitable, with or without upskilled ministries of commerce. Which nations and regions are ready to engage in this tactical battlefield of global-age skills? Study how Expothon Africa is in deployments with selected countries.
The deciding factors: Never ever before in the history of humankind,the economic behaviorism across the world suddenly surrendered to a single calamity, affecting the majority of the global populace suffering in prolonged continuity. The side effect of such complexity juxtaposed with technological access can bring sweeping changes to our assumed complacency. All traditional problem solving and conventional thinking styles now considered too dangerous to economic growth and social balances.
Recommendation and Survival Strategies: Discover and establish authoritative command on digitization and virtualization of economies, study more on Google.Allow micro-small-medium enterprises a tax-free window on the first USD$5-10 million revenues in exports, this will create local jobs and bring foreign exchange. Allow micro-small-medium enterprises free access to all dormant Intellectual Property, Patents rolled up due to lack of commercialization. Allow Academic Experts on innovative technologies and related skills on free voucher programs to the SME base to uplift ideas and special expertise. Optimization of telecommunication and internet structures worth trillions of dollars with global access at times completely ignored and wasted by wrong mindsets deprived of entrepreneurial undertakings. Allow micro-small-medium enterprises free full time MBA as 12 months interns so MBA graduates can acquire some entrepreneurialism while enterprises can uplift their ideas in practice.
“Allow Million qualified foreign entrepreneurs to park within your nation for 5-10 years under a special full tax-free visa and stay program. Which nations have qualified dialogue on such affairs? Bring in, land million entrepreneurs in your nation, and create 10 million plus jobs and new wealth in following years. Let your own institutions and frontline management learn how such economic developments created. Be bold, as the time to strategize passed now time to revolutionize has arrived”. “Excerpted from keynote lecture by Naseem Javed, Global Citizen Forum, Dubai, 2013.”
Allow National Mobilization of Entrepreneurialism Protocols mandated to engage trade and exports bodies. Allow National Scoring of entrepreneurialism to measure, identify and differentiate required talents. Digitize from top to bottom and sideways, futurism fully digitized and without real transformation, it is like a nation without any internet. Act wisely. Digitalization of economies without entrepreneurial minds is more like pre-pandemic archives of mostly failures. Needed are the economic revolutions, based on entrepreneurial meritocracy and national mobilization of midsize economy.
The rest is easy
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Pegasus Spyware Scandal has shaken whole India and several other countries. What will be its fallout no one knows as...
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