While the prolonged COVID-19 pandemic has struck the global economy hard, it is developing countries with limited access to innovative solutions that are reeling the most.
To provide a safety net for struggling economies and move toward common prosperity, it is crucial that innovation leaders such as South Korea share their experience and expertise, according to a senior international development expert.
“Leveraging its expertise, experience, and knowledge will be the key for Korea to grow into an innovation and technology hub in international development,” Akihiro Nishio, the World Bank’s vice president for development finance, told The Korea Herald via email.
For instance, the Korean New Deal -- a midterm policy package propelled by the Moon Jae-in administration to foster green growth and digital transitions -- will serve as a guide for developing economies on how to pursue digital, eco-friendly and sustainable growth, according to the WBG official.
Especially in light of the ongoing COVID-19 pandemic crisis, the country’s relatively successful countermeasures have written a new chapter in international development case studies, he added.
“I believe that Korea’s response to COVID-19 provides tangible lessons for developing countries. The World Bank will work on creating a platform for global coordination and knowledge exchange to help countries adopt international best practices for preparing for future pandemics and other risks.”
The latest email interview came on the sidelines of the IDA-Korea Workshop on Innovation and Digital Technology in the Post Pandemic World, held Thursday at The Shilla Seoul.
Organized jointly by the World Bank Group Korea Office, the International Development Association and Seoul’s Ministry of Economy and Finance, the event was the development finance institution’s first offline conference since the COVID-19 outbreak.
The World Bank Group, a multilateral financial body headquartered in Washington, consists of five organizations -- the International Bank for Reconstruction and Development, the International Development Association, the International Finance Corporation, the Multilateral Investment Guarantee Agency and the International Centre for Settlement of Investment Disputes. Together, the International Bank for Reconstruction and Development and the International Development Association constitute the World Bank.
Of the WBG-affiliated organizations, IDA seeks to reduce poverty by providing low-interest or zero-interest loans and grants for programs that boost economic growth, reduce inequality and improve people’s living conditions.
Overseen by 173 shareholder nations, IDA is one of the largest sources of assistance for the world’s 74 poorest countries and is the single largest source of donor funds for basic social services in these countries.
Established in 1960, IDA has invested $422 billion over the past six decades, supporting more than 8,000 projects in 114 countries. While 37 countries have graduated from the development programs, some have evolved to become donors -- including Korea.
The country joined the IDA in 1961 and for more than a decade benefited from financial and technical assistance in agriculture, transportation, finance and education.
Graduating in 1973 and swiftly joining the IDA donor club in 1977, Asia’s fourth-largest economy now stands as the 14th-largest donor in IDA19 -- the organization’s financing and policy package that seeks to reach its sustainable development goals by 2023.
Korea is expected to play an even more pivotal role down the road as IDA and other international organizations focus on reducing the inequalities in technology, the WBG official added.
“Partnerships in the tech area are needed even more now, especially after the COVID-19 crisis, which has exposed further the inequalities in access to and use of digital technologies,” the vice president said.
“Korea will be an important player in helping narrow the gap between the developed and developing world, as it has immense experience from its own development story to motivate and help other countries.”
The COVID-19 pandemic is estimated to have pushed an additional 88 million to 115 million people into extreme poverty this year, with the total rising to as many as 150 million by 2021, depending on the severity of the economic contraction.
In response, WBG is deploying up to $160 billion in financial support over 15 months to help more than 100 countries protect the vulnerable, support businesses and bolster economic recovery.
Nevertheless, IDA countries now face the risk of moving backward, with poverty rising again for the first time in 20 years, Nishio added.
The vice president’s concerns were echoed by Victoria Kwakwa, the WBG’s vice president for East Asia and Pacific, who gave the opening remarks at the workshop.
“Developing countries need more than financial resources for recovery. What they need is access to global best practices and innovative, technology-enabled development solutions,” Kwakwa said.
For this reason and thanks to the active support of the Korean government, the WBG Korea office is paving its way to becoming a new global hub for innovation and technology for sustainable development, she added.
By Bae Hyun-jung (firstname.lastname@example.org