Despite fast growth and progress in poverty reduction, income inequality in Asia has increased over the past decade. Major players in Asia have therefore agreed that growth in the region could be more “inclusive” if there would be better social safety nets and greater investment in health and education.
Asian stakeholders from the public and private sectors, the donor community and the academe came together to discuss how the region’s low-income countries can achieve growth and overcome poverty amid an uncertain global economic climate. This was tackled in a conference in Tokyo hosted by the International Monetary Fund and the Japan International Cooperation Agency Wednesday, Oct. 12.
In the partnership, JICA will be paying more attention to macroeconomic situations of aid-receiving countries, while the IMF will be more involved in LICs’ inclusive growth.
The stakeholders in the conference also agreed LICs in Asia need to develop broader financing options, including the private sector, and attract foreign direct investment in infrastructure. For this, a national strategy that looks at infrastructure improvement and financial deepening is crucial for structural change. This could then boost longer-term resilience, strengthen infrastructure investment and financial sector development to enhance growth potential of LICs.
Participants also emphasized the need to learn from other experiences with public-private partnerships and integrate them in Asia’s LICs.
The outcome of the conference will be reflected in global dialogues on development aid such as the G-20 Meetings and the Fourth High Level Forum on Aid Effectiveness.
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