Tuesday, November 21, 2006

Economic Growth Does Not Guarantee a High Level of Human Development

After a successful completion of the course on regional development in Japan, I'm back in Moldova. Today I attended a conference where the publishing of the Moldova National Human Development Report 2006 was announced, and public debate on the findings of this report encouraged. This analytical document was prepared by Moldovan experts and financed by UNDP. My first impression: it is a good analytical piece, and tackles key development issues in the Moldovan economy and emigration, governance and administration, education and health. One achievement of this report is that it attempts to quantify the problems in the sectors that determine the level of human development in Moldova. Another achievement is that it proposes policy recommendations, even very bold ones. Last, public debate is always beneficial, and some very good comments on this topic were made today.

A finding that I find very interesting is that economic growth does not necessarily translate into a high level of human development. What actually matters much more is the quality of economic growth. According to this Report, a high quality economic growth is socially and geographically inclusive. The market alone will not achieve such high quality economic growth. Smart and well-targetted public polices are needed to ensure that all people in the country benefit from it. My sincere wish is that the government consider the findings of this Report in designing future policies.

Comments:

Anonymous , November 22, 2006  

We also have to keep in mind where the growth in Moldova comes from. About 1/3 is formed by Moldavian labour migrants: http://www.newsmoldova.ru/news.html?nws_id=586448

For 9 months of the present year they transferred to Moldova USD 603,75 mln. (108 mln. more than for the same period in 2005): http://www.newsmoldova.ru/news.html?nws_id=586521

And these are only the sums that have been tracked. I'm sure that the real sum is higher...

ALL other economic indices in Moldova have worsened during the last year.

I'm not a pessimist, beleive me. But we must be realists about any indices of our economicg growth. There's still no real growth of real Moldavian economy. It's like the drug addict depending on money sent to the country by thousand of Moldovans working abroad...

Lucia , November 22, 2006  

You are absolutely right. The GDP growth is mainly due to the remittances sent by Moldovans working abroad to their families. Moreover, this money is used mainly for consumption of imported goods. Therefore, the Moldovans working abroad are actually supporting the economies of other countries.