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A Decade in Power: Reviewing Kim Jong-un’s Economic Policies



An average person primarily knows North Korea’s Supreme Leader Kim Jong-un for two things: the nuclear bombs and his ruthless rule. As he finishes his first decade in power in April this year, let’s have a look at a much lesser scrutinised aspect of Kim’s rule, the economic policies.

A Rough Start

Little was known about Kim Jong-un when he was announced as his father’s “Great Successor” in December 2011. He remained under the wraps for most of his life before attaining the top position in Pyongyang and is not known to have any preliminary experience either in the Military or the Communist party like his father and grandfather.

However, sustaining the power did not come as easily for the ‘Brilliant Comrade’ (영명한 동지), as Kim came to be known, as the succession did. Before him, stood several grave challenges. The Stalinist socialist economic model was severely weakened not only by ideology based  overproduction campaigns which resulted in abundant, unmarketable  low quality products and irrational decisions divorced from market dynamics but was also crushed by the heavy sanctions imposed on the economy due to the regime’s nuclear development programme.

Moreover, Pyongyang dealt with a major food crisis since the Arduous March of the 1990s when failure of the state’s agrarian policies, aggravated by sanctions and recurrent natural calamities, resulted in crop failures en masse leading to widespread hunger and starvation. Through the ‘Arduous March’, Kim Jong-un’s father, Kim Jong-il asked the populace to ‘bear the hardships and work harder as to pull the nation out of the grave crisis’.

Kim Jong-un’s Economic Policies

Let’s have a look at Kim’s economic policies that he has implemented in order to address these challenges.

Byungjin (병진)

The Byungjin policy was announced at the Plenary Meeting of the Central Committee of the Workers’ Party of Korea on March 31, 2013. The policy advocates the dual plan of simultaneously developing nuclear and economic capabilities. Unlike his grandfather and father, the younger Kim considers military costs as burdensome, even hindering economic growth.  He claimed that military and civilian economies walk different paths from the very start and hence, military development is unfit to lead the civilian economy.

Kim Jong-un found an alternative in nuclear development which he considers less expensive and more impactful. By prioritising the civilian economy over the military, Kim Jong-un has not only presented his image as a leader who keeps the interests of the people over state institutions like military but has also circumvented the influence of his father’s peers who dominated the military under Kim Jong-il’s Songun (Military First) policy. The junior Kim believes that the state could only focus on people’s livelihoods after security threats stemming from the United States and its allies are averted through high tech nuclear weapons.

‘Our Style of Economic Management Methods’ (우리식경제관리방법)

‘Our Style of Economic Management Methods’ calls for diversification of foreign trade as well as establishment of economic and special economic zones, calling for limited opening up of the economy. The policy supports individual investments by giving autonomy to companies without hampering the larger socialist economic model of state ownership. The Kim Jong-un regime has also promoted incentivising workers in material and monetary ways rather than solely calling for contribution based on ideological motives.

Industrial Policy: People’s Livelihood and Light Industries

Kim Jong-un has continued his father’s industrial policy of normalising the four key areas of priority including coal, metal, electricity and railways as well as developing light industries which are known to provide abundant employment opportunities. Under Kim Jong-un, agrarian inputs such as high quality seeds and fertilisers have formed a major import item which led to gradual increase in agrarian productivity. The regime has also heavily invested in large scale projects begun under Kim Jong-il such as hydropower projects to counter the massive energy crisis.

Jagangryeok ( 자강력제일주의) and Localisation of Production

North Korea under Kim Jong-un has also adopted the policy of Jagangryeok or self-reliance by ‘localising raw materials, commodities and facilities for production based on their own power, technology and resource’. This way Pyongyang seems to not only tackle international sanctions but also lessen its dependence on China. Self reliance and an inward looking economy, however, do not provide a reliable solution to the economic crisis that North Korea faces.

Science and Technology

Kim Jong-un has also invested high hopes in Science and technology which not only includes distribution of Computerised Numerically Controlled (CNC) machine tools and boosting the morale of the scientists but also promoting high tech industries.

State’s Retreat, Market’s Advance

The Kim Jong-un regime has also adopted policies which restrict the role of the State in the economy and allow space for markets to function. At the 7th Congress of the Central Committee of the Workers’  Party of Korea in May 2016, the regime announced the ‘ Five Year National Development Strategy’. The change in parlance from ‘Plan’ of the previous policies to the use of ‘Strategy’ must be noted. Following the name, the State simply draws ‘broad outlines’ for the economy and does not specify production targets as it did previously.

Kim Jong-un has also shown a greater tolerance for markets, both official general markets and the unofficial “grasshopper” ones. While private property is still banned, houses and enterprises can be traded on payment of a fee. A small rich class called donju which has appeared on North Korean soil often operates de facto private firms by either investing in state firms or by leasing them. This pace of privatisation has become faster under Kim Jong-un. The State has thus tried to reap the benefits of the baby steps that the market has come to take by absorbing profits.

Currency and Financial Reforms

In December 2009, the North Korean regime under Kim Jong-il adopted Currency reforms which included the redenomination of North Korean Won where the new Won would be equal to 100 old Won and required the people to exchange the old Won for the new Won with a limit of 1000 new Won per household. Instead of regulating the market as intended, the policy resulted in massive inflation and circulation of foreign currency owing to rushed attempts to sell it. Instead of banning the foreign currency, the Kim regime sought to absorb it by promoting savings in foreign currency and through foreign currency based cards and stores.

The Heavy Weight of Sanctions

North Korea’s nuclear proliferation programme has invited several excruciating international sanctions. Direct sanctions on its international trade were imposed after its fourth nuclear test in 2016, the most powerful ones are listed below.

The United Nations Security Council Resolution 2270 prohibits the export of items such as steel, coal and iron ore with  exceptions for civilian use to avoid unintended damage which has been actively used by the Kim regime to circumvent it to some extent, considering the fuzzy demarcation between state and limited private owned trading enterprises on one hand and between civilian and military enterprises on the other.

The UNSC Resolution 2321, which was imposed after its 5th nuclear test, limits the amount of coal exports which directly hit bilateral export trade with China in the first half of 2017. As North Korea continued its nuclear and missile development programme, more sanctions were slapped on it.

UNSC Resolution 2371 completely prohibits the export of North Korea’s major trading commodities such as steel, fisheries, coal and iron ore. UNSC Resolution 2375, on the other hand, bans exports of textile, combined together, these two resolutions ban five major export items in toto. Moreover, UNSC Resolution 2397 added more items to the banned list which include agrarian produce, machine, electronic goods, timber, metals, transportation methods, ships as well as limits the upper limit of crude oil supply at 4 million barrel and refined oil to 0.5 million barrel, causing a severe dent to the North Korean economy.  Moreover, under UNSC Resolution 2397, North Korean workers working abroad (which number approximately 50,000 to 100,000) must return back within 24 months.

Seesawing Growth

Even with several odds, Kim Jong-un managed to attain gradual economic growth in the first five years of his rule, with 2015 being an exception when the economy fell sharpest in 8 years  as the Gross Development Product (GDP) fell a real 1.1%, marking not just the first fall since 2010 but also the sharpest decline since 2007, reports South Korea’s central bank, th Bank of Korea (BOK), which publishes the most reliable statistics on North Korean economy since state published data from Pyongyang has been off the shelves.

The year 2016 recorded the highest growth rate as GDP climbed to 3.9%. It is estimated that North Korea has been attaining an annual growth rate of 1.2% in the five years between 2012 to 2016, which is by no measure a disappointing performance for an economy laden with sanctions.

However, bad days were just around the corner. In 2017, the BOK reported that North Korea’s economy declined its sharpest in two decades owing to the sanctions. In 2018, the economy reached its lowest in 21 years owing to the impact of the sanctions and severe droughts. A glimmer of hope appeared when in 2019, the economy displayed a positive growth for the first time in three years due to better weather conditions.

Kim has also succeeded in stabilising prices and expanding foreign trade. Prices of more or less all commodities have seen a sharp rise throughout the 2000s for two reasons associated with gross demand (expanded liquidity due to increased issue of currency and rising expectations of inflation owing to the uncertainties of the market trade) and gross supply (soaring currency owing to worsening supply and demand of foreign currency, shortage of food supply and rise in international crop prices). The situation was further worsened by the failure of the currency reforms of 2009. However, things have taken a positive course since Kim came to power. The price of rice, an essential food crop and trading item in North Korea has declined or remained still and so have the prices of most grocery items. The North Korean Won also stabilised after 2013. 

Uptil 2010, the foreign trade accounted for just US $3-4 billion which was later expanded to US $6.36 billion, up by 52.3%. Such a favourable outcome could be attained thanks to coal exports, which increased the exports share by upto 85% year on year while imports volume increased by around 35%. The volume of foreign trade reached its highest in 2014 pegged at US $7.61 billion. Foreign trade however,has been heavily lopsided with a high trade deficit with China, North Korea’s largest trade and aid partner.

Sunny days proved to be short-lived as the pandemic stormed in.

Pandemic woes

Whatever little success was achieved and whatever spark his policies retained was put off as the coronavirus pandemic pushed economies across the world into recession. Though North Korea has claimed not to record a single case of the virus, the strict lockdown and the complete border closure badly hit the economy and reversed the 0.4% growth rate which was attained a year back in 2019. The BOK claimed that Pyongyang’s GDP contracted 4.5% in 2020 while industrial output sharply fell from 28% to 5.9%. Output of agriculture, fisheries and forestry declined by 7.6%.

Strict border closure meant that foreign trade became negligent. The imports from China reportedly fell from US  $28.75 million to US $2.71 million. As a result, the North Korean Won surged around 15-20% against the US Dollar and the Chinese Renminbi in a week. While government rations of corn and rice moderated prices of food grains in several major cities like Pyongyang, prices of fuel, food and consumer goods skyrocketed. As per NK News, the price of a bottle of shampoo reached US $200 while a kilogramme of banana was being sold for  US $45.

At the Eighth Congress of the Workers’ Party of Korea in 2021, Kim accepted that his economic policies had failed “in almost all aspects to a great extent” and vowed not to let “painful lessons of the past” repeat.

The pandemic has further pushed the nation, where 40% of the population was already stricken by hunger and malnourishment, into the worst food crisis in its history as 60% of the population have been rendered jobless and live in abject poverty. As per the Food and Agriculture Organisation, 68% of an average North Korean diet is made up of cereals, tubers and roots, none of which were imported from China in 2020. In April 2021, Kim Jong-un anticipated a forthcoming severe food crisis by asking the masses to ‘prepare for another Arduous March’.

Food shortage was estimated to reach 860,000 tonnes of grain in 2021.

Whither Pyongyang?

An assessment of Kim Jong-un’s economic policies challenges his image as an ignorant tyrant as it exists in the West. Though he has proved himself as a shrewd politician who not only understands the importance of reforms but also has used it to curtail the influence of the old elite so as to expand his own influence, all his policies for change revolve in the same Stalinist Socialist economic framework that his grandfather built eight decades ago. Though the dynamics and priorities have changed, the larger bounds remain the same and show no signs of being reformed anytime soon.

While the dark clouds of economic crisis loom large, North Korea continues its weapons of mass destruction programme unabated and has even pointed to the possibility of resuming its nuclear development programme which has been under a self imposed moratorium since 2017. It has not only tested what it claims to be its most powerful Intercontinental Ballistic Missile (ICBM) till date,but even released a fancy video featuring Kim celebrating its sophisticated weapons development capabilities which is bound to invite more pressing sanctions. Until sanctions are lifted and integration of the North Korean economy with the international economy takes place, hopes for any betterment in the lives of common people remain low.

Denuclearisation is essentially tied to the issue of lifting of sanctions but past behaviour shows that Pyongyang would never agree for one sided denuclearisation. Rowing in a direction contrary to the entire world both politically and economically, the North Korean regime has several concerns with the topmost being regime survival which denuclearising first  would majorly challenge, if not directly threaten. All countries, including the United States, must commit to denuclearisation in a phased manner for Pyongyang to agree for it. The idea is not to show any clemency to the Kim regime but not addressing their concerns would only result in stalemate, which with growing lethal weapons proliferation becomes unaffordable.

Was Kim Jong-un inches away from reforming the economy? If not for Covid, could North Korea have seen its own ‘Reform and Opening up’ moment to the likes of China under Deng Xiaoping? Perhaps or Perhaps not. With the restricted information that reaches from Pyongyang to our end, we may never predict his moves accurately  but it is certain that Kim Jong-un understands that change in the economic system would be an inevitable choice. Moreover, liberalisation in the economy has not only been known to bring some form of political liberalisation but also predictability to the regime’s actions once it has greater and shared concerns with other nations.

How far is Kim prepared to walk the path of change? While the present seems disappointing, it is certain that he will fight till the end to ensure his Workers’ Party of Korea-led regime does not collapse and he might embrace marketisation albeit gradually to ensure that.

Cherry Hitkari is a postgraduate student of East Asian Studies at University of Delhi, India and a current intern at Modern Diplomacy.

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World Order Is Old Order: New World Order Is No Order



The grand hallucinations: When there is any order, it always becomes visible as an orderly progression, when it is supposed to be a secret or an invisible order, then it is grand hallucinations for a cult of illusionists. Observe how the World Order is an old order, and notice how the new world order is no order. The random engagements in illusionary cultish acts of chaos sold as order. Fakery sold and resold as victory, illusions pushed as hallucinations of success. Courage is needed to see the big magical acts of grand hallucinations.

The feel of afternoon-high: Across the world, free economies are already bent, twisted or broken, while procedures, policies and laws, everything on sale for the right price. Mighty-money, delivered crisply stacked, shrink-wrapped as freshly printed solutions, to buy more chaos, spread misery and create the economic hallucinations and stage the smoke and mirrors, all without any totals, balances or columns. Sold to feel a real afternoon-high.

The interchange: When integrity gone, fakery dominates, when real value-creation gone value-manipulation regulates, when vision gone illusions thrives, when national economics gone hallucinations declared as great success and reality interchanges to fakery.  

The elasticity left: Needed across the free economies of the world, no further proof required, a total change, no further verification needed, as political power no longer economical power, no further help needed, as most nations in need of basic diaper change. Visible damage to skills and competency, inability to understand and articulate the real problems with grassroots solutions is now a big tragedy of our times. Nations already stretched via rubber band economy, some with elasticity left before going bust.

The truth: Which nation has the capacity to face the truth? Which nation can fix itself not just top reshuffle, but rather from top to bottom to the real core? Which nation can uplift its citizenry to stand up to global age skills and cope with global speed and competitiveness? Which nation is capable of understanding and has the right to mobilize its hidden national entrepreneurialism and provide a future for the next generation?

No electricity and missing bulbs: Is there any value left in the most cherished Machiavellian style political power without ever creating any economic power? Is there any remaining value in economic power play of today without entrepreneurial growth models? What good are economies when stuck in waste paper baskets still without digitization like a nation being without electricity? What real economic value is created when odd mindsets playing with economic development procedures like creating light but with no bulb?  

Welcome to cold facts and warm realties.

The branded nations: Why each and every single nation of our planet is now branded every single day of the year? Like it or not, agree with what is said, disagree with what gossiped, simple fact of the day,  each nation is branded, between each sunrise and sunset. Here is some advanced level insight for the national leaderships on global corporate communication challenges, as what may be altering their efforts on global affairs, what might mold their global trades as the deep undercurrents of global ‘likes’ and ‘dislikes’ from the global populace shape their national global image and rate of popularly and any level of respect on world stage.

The global opinion: Observe how fast the world changed, how the ocean of “global opinion” is now drowning ponds of “national opinion”. Notice, nations already intoxicated, in joy over the popularity of their own national opinion, while having just an opposite global opinion on the world stage. What does this mean to a nation’s image supremacy, how does this translate into economic impacts? Why is any global opinion of any kind important anyway? Be cautious, if such important topics are not discussed in your boardrooms, check out the restrooms.

The fabric of humankind. Every huge, little, deadly, serious or funny incident of any kind, becomes ‘alive’ in global social media, where despite all controls its is processed with common sense with common emotions, commented and circulated around the world, many times, registered, measured, analyzed, criticized and humanized as good, bad or ugly in the minds of the global populace.  No one can stop it. Facing truth is now a new global challenge of moral strength, something that increasingly demands insight and awareness. Shunning, arguing or defending and fighting has little or no power, as the real power hidden is in critical thinking to solve common good, humankind issues.   

The 200 nations, now under their own global digital spell, responding, and adjusting their own feedback and updating reality checks, influenced by the five billion, connected populace driving the world opinion.  The voices are no longer the big old-media, as they have already lost their credibility and power,  but across the world the new known and unknown big and small clusters of people sharing their thoughts amongst their local and global connectivity and surroundings. The truth rises, because this is how the critical needs for common good and social justice advances. The fabric of humankind stretches, starts to cover all nations.

Weaponization of Ideologicalism:  Why are most nations increasingly unable to control their restless citizenry? How much more will the citizens of these nations, continuously influenced by the global opinion, facing common sense, chasing truth, turning internal tribalism, into cultural wars defining limits of ideologies, as Weaponization of Ideologicalism slowly ripping local social fabric and crushing economies. Where are the repairmen, where are the solutions, which leadership is ready to articulate and bring national mobilization of entrepreneurialism as an untapped national treasure. Which nation is ready to face reality and show their advanced skills?

The aimless directives: When nations appear aimlessly drifting into hallucinations, the lack of vision, absence of social justice, unable to control internal tribalism, cultural wars move to ideological wars. Nations fragmented and splintered, now facing street by street mental wars. The visible lack of skills at the top management, lack of speed of execution at middle level and the absence of any motivation at remaining workforces now seriously limits all new options.

The coming revolution: The next global revolution, driven by economic chaos based on social failures, while the middle classes already disappeared, may not be about the mobs of commoners with broom-sticks but most likely the imploding calm and silent systemic collapse of bureaucratic administrative blockades and fall of economic intellectualism for destroying the fabric of humankind.

The absence of dialogue, only proves lack of real pragmatic solutions, skills and competence. Electioneering, sloganeering and fakery of wars to remain in power with no real economic solution, in global opinion a colossal failure.  Therefore, “Self Mastery” urgently needed to differentiate between a mesmerized mind with an enlightened one will possibly be a way to face the new challenges. Economies will only improve when old methodologies declared broken

The new world order: No other time in the history of civilization, so many globally connected will hold responsible the so few in power for destroying the remains of world order and bringing the world to a nuclear war.  A war, suggested to eliminate five billion people. It is possible, the coming revolutions to be less about anarchy but more about establishing real meritocracy. The need to search, find and strive for real value creation to answers grassroots prosperity affairs and eliminate lingering bureaucracies with fermented layers of incompetency. How soon will the five billion connected reach a critical point to select the right players with right policies and declare common good the new ultimate goals? This may eventually lead to a new world order. Pandemic was just a sneeze, economy, now like a hole in the empty pocket, leadership like a circus show, while billions looking up. Acquire mastery. Get ready for major global shifts of major economic behaviorism. The rest is easy. 

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Mosul’s recovery moves towards a circular economy



Five years since the end of the ISIL(so-called Islamic State in Iraq and the Levant) conflict in 2017, the International Organization for Migration (IOM) in Iraq and the UN Environment Programme (UNEP), with funding from the Government of Japan, has established a debris recycling centre in Mosul. After its initial use, the centre has now been handed over to Mosul Municipality for its continued, sustainable operation.

“On behalf of the Iraqi Government, the Ministry of Environment expresses its gratitude to the Government of Japan for generously supporting this important project and to UNEP and IOM for enabling the sustainable management of the huge quantities of conflict debris and restabilization of the liberated areas in an environmentally sustainable manner,” said Iraq’s Minister for Environment, Dr. Jasim Abdulazeez Humadi.

The handover of the Mosul debris recycling centre marks a significant step in the sustainable management of the huge volumes of debris — an estimated 55 million tonnes — created by the ISIL conflict. It also opens the way for the recycling of routine construction and demolition waste, contributing to ‘building back better’ and an increased circularity in Iraq’s development.

UNEP West Asia Regional Director, Sami Dimassi, emphasized that “by reducing waste, stimulating innovation and creating employment, debris recycling also creates an important business opportunity.” Indeed, construction companies in Mosul have expressed interest in purchasing the recycled aggregate, thereby underscoring the longer-term sustainability of debris recycling.

“This project supports recovery and livelihoods by drawing on principles of a circular economy, wherein waste and land pollution is limited through production processes that reuse and repurpose materials for as long as possible,” explained IOM Iraq Chief of Mission, Giorgi Gigauri. “Collaboration and sustainability are key priorities in IOM’s work toward durable solutions to displacement, and we are pleased to have partnered with UNEP and the Government of Japan so that this is represented not only in the function of the plant itself, but also in its functioning, by supporting local authorities to be prepared to effectively operate the plant moving forward.”

On 28 July 2022, Mosul Municipality hosted an event to officially hand over the debris recycling centre, attended by senior government officials and academia, as well as representatives from IOM, UNEP and the United Nations Assistance Mission for Iraq (UNAMI).

Masamoto Kenichi, Charge d’Affaires, Embassy of Japan to Iraq stated: “We are glad to know that the project funded by the government and people of Japan has contributed to cleanup of debris and reconstruction of Mosul. We would like to commend UNEP, IOM and the city of Mosul for their tremendous efforts of turning the legacy of ISIL’s devastation into building blocks of reconstruction”.

Through the rubble recycling project, nearly 25,000 tonnes of debris have been recovered and sorted, of which around half was crushed into recycled aggregate. Material testing of the recycled aggregate endorsed by the National Center for Structural Tests of the Ministry of Planning confirms its compliance with the Iraqi State Commission for Roads and Bridges design standards for road foundational layers and its suitability for several low strength end-use applications such as concrete blocks and kerbstones.

The project created 240 much-needed jobs through cash-for-work schemes targeting vulnerable persons, including 40 women.

Building on this experience, IOM has set up two other debris recycling operations in Sinjar and Hamdaniya in Ninewa Governorate, and a third in Hawija in Kirkuk Governorate, where a pilot phase using a mobile crusher was implemented in al-Buwaiter Village in 2021. In addition, two other conflict-affected governorates — namely Salah al-Din and Anbar — have  also shown a high-level of interest in replicating and scaling up debris recycling in their own regions. 

UNEP has been supporting Iraq in cleaning up the huge volumes of debris created by the ISIL conflict since June 2017. Initially, this included carrying out technical assessments and planning workshops with UN-Habitat, and subsequently designing and implementing debris recycling pilot projects to support returns in Mosul, Kirkuk and other conflict-affected areas in cooperation with IOM.


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Digital Futures: Driving Systemic Change for Women



Authors: Erin Watson-Lynn and Tengfei Wang*

As digital technology continues to unlock new financial opportunities for people across Asia and the Pacific, it is critical that women are central to strategies aimed at harnessing the digital financial future. Women are generally poorer than men – their work is less formal, they receive lower pay, and their money is less likely to be banked. Even when controlling for class, rural residency, age, income, and education level, women are overrepresented among the world’s poorest people in developing countries. Successfully harnessing digital technology can play a key role in creating new opportunities for women to utilise formal financial products and services in ways that empower them. 

Accelerating women’s access to the formal economy through digital innovations in finance increases their opportunity to generate an income and builds resilience to economic shocks. The recently issued ESCAP guidebook titled, Harnessing Digital Technology for Financial Inclusion in the Asia Pacific, highlights the fact that mechanisms to bring women into the digital economy are different from those for other groups, and that tailored policy responses are important for women to fully realise their potential in the Asia-Pacific region.

Overwhelmingly, the evidence tells us that how women utilise their finances can have a beneficial impact on the broader community. When women have bank accounts, they are more likely to save money, buy healthier foods for their family, and invest in education. For women who receive Government-to-Person (G2P) payments, there is significant improvement in their lives across a range of social and economic outcomes. Access to safe, secure, and affordable digital financial services thus has the potential to significantly improve the lives of women.

Despite the enormous opportunity, there are numerous constraints which affect women’s access to financial services. This includes the gender gap in mobile phone ownership across Asia and the Pacific, lower levels of education (including lower levels of basic numeracy and literacy), and lower levels of financial literacy. This complex web of constraints means that country and provincial level diagnostics are required and demands agile and flexible policy responses that meet the unique needs of women across the region.

Already, across Asia and the Pacific, governments are implementing innovative policy solutions to capture the opportunities that come with digital finance, while trying to manage the constraints women often face. The policy guidebook provides a framework to examine the role of governments as market facilitators, market participants and market regulators. Through this framework, specific policy innovations drawn from examples across the region are identified which other governments can adapt and implement in their local markets.  

A good example of how strategies can be implemented at either the central government or local government levels can be found in Pakistan. While central government leadership is important, embedding tailored interventions into locally appropriate strategies plays a crucial role for implementation and effectiveness. The localisation of broader strategies needs to include women in their development and ongoing evaluation. In the Khyber Pakhtunkhwa province, 50,000 beneficiary committees comprising local women at the district level regularly provide feedback into the government’s G2P payment system. The feedback from these committees led to a biometric system linked to the national ID card that has enabled the government to identify women who weren’t receiving their payments, or if payments were fraudulently obtained by others.

In Cambodia and the Philippines, governments have implemented new and innovative solutions to support remittance payments through public-private-partnerships and policies that enable access to non-traditional banks. In Cambodia, Wing Money has specialised programs for women, who are overwhelmingly the beneficiaries of remittance payments. Creating an enabling environment for a business such as Wing Money to develop and thrive with these low-cost solutions is an example of a positive market intervention. In the Philippines, adjusting banking policies to enable access to non-traditional banking enables women, especially those with micro-enterprises in rural areas, to access digital products.

While facilitating participation in the market can yield benefits for women, so can regulating in a way that drives systemic change. For example, in Lao People’s Democratic Republic and India, different mechanisms for targets are used to improve access to digital financial products. In Lao People’s Democratic Republic, the central government through its national strategy, introduced a target of a 9 per cent increase in women’s access to financial services by 2025. In India, their targets are set within the bureaucracy to incentivise policy makers to implement the Digital India strategy and promotions and job security are rewarded based on performance.

These examples of innovative policy solutions are only foundational. The options for governments and policy makers at the nexus of market facilitation, participation and regulation demands creativity and agility. Underpinning this is the need for a baseline of country and regional level diagnostics to capture the diverse needs of women – those who are set to benefit the most of from harnessing the future of digital financial inclusion.

*Tengfei Wang, Economic Affairs Officer

This article is the second of a two-part series based on the findings of the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) Policy Guidebook: Harnessing Digital Technology for Financial Inclusion in Asia and the Pacific, and is jointly prepared by ESCAP and the Griffith Asia Institute.source: UNESCAP

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