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As cited by Dash (2019) Inclusive growth means economic growth that creates
employment opportunities and helps in reducing poverty. It means having access to essential
services in health and education by the poor. It includes providing equality of opportunity,
empowering people through education and skill development. It also encompasses a growth
process that is environment friendly growth, aims for good governance and a helps in creation of
a gender sensitive society.
Duran (2015) stated that, Inclusive economic growth is not only about expanding national
economies but also about ensuring that we reach the most vulnerable people of societies. The
“equality of opportunity” and “participation in growth by all” inclusive economic growth is not
only about expanding national economies but also about ensuring that we reach the most
vulnerable people of societies. The “equality of opportunity” and “participation in growth by
all” with a special focus on the working poor and the unemployed are the very basis of inclusive
growth.
Felipe (2012) in his work Inclusive growth: Why is it important in developing Asia?
The paper has offered an interpretation of inclusive growth as a clear policy objective, namely
the achievement of full employment, that’s, a state of zero involuntary unemployment. This
means that no one who is ready and willing to work for an appropriate wage is without a job.
This also means zero involuntary employment.
Felipe proposed five policies to achieve full employment of the labor force: I redress the neglect
of agriculture; ii undertake public investment in basic infrastructure (energy, transport, urban
services) targeted to high-employment projects; iii Use of industrial policy, understood as a
collaborative effort between public and private sectors, to accelerate industrialization, and
structural transformation in general; iv Gear fiscal and monetary policies for the achievement of
full employment; and v implement job guarantee programs.
Habito (2009) in his works titled Patterns of Inclusive Growth in Developing Asia stated
that insights from an Enhanced Growth-Poverty Elasticity Analysis Initiatives and investments
toward strengthening the quality of governance could be the most important measures a country
can take toward attaining inclusive growth, as governance is a critical underlay to all initiatives
of government to reduce poverty and promote broad-based growth and development. Public
investments in education, health, and housing are important—and indeed most tightly correlated
—to the attainment of inclusive growth. Economic growth by itself, especially when driven by
economic sectors with low employment potential, will not guarantee poverty reduction, as borne
out by the experience of Pakistan and the PRC in the 1990s and Mongolia, the Philippines, and
Sri Lanka in the past decade.
Enhancing the role of agriculture in the growth of the economy continues to have a positive
impact on the inclusiveness of growth, particularly in reducing rural poverty. The obvious key to
the role of agriculture is the employment it generates in the rural areas. But this suggests that
promotion of rural enterprises in general, including in manufacturing and services, would be
instrumental in the attainment of more inclusive, broad-based growth.
Lanchovichina & Lundstrom, (2009) In Radam 2015 Inclusive Growth adopts a long
term perspective and is concerned with sustained growth.
For growth to be sustained in the long run, it should be broad-based across sectors. Issues of
structural transformation for economic diversification therefore take a front stage. Some
countries may be an exception and continue to specialize as they develop due to their specific
conditions (e.g. small states). It should also be inclusive of the large part of the country’s labor
force, where inclusiveness refers to equality of opportunity in terms of access to markets,
resources and unbiased regulatory environment for businesses and individuals.
According to the NEDA (2013) Inclusive growth means, first of all, growth that is rapid
enough to matter, given the country’s large population, geographical differences, and social
complexity. It is sustained growth that creates jobs, draws the majority into the economic and
social mainstream, and continuously reduces mass poverty
Viewed by majority of Filipinos, the record of economic and social progress up to now has
proved unsatisfactory for three reasons: first, its pace has been slow when measured against the
achievements of the country’s neighbors; second, the benefits of that progress have not been
broadly shared; and third, issues of massive corruption and of questioned political legitimacy
have undermined the people’s sense of ownership of and control over public policy. Growth has
not only lagged, it has failed to benefit the majority, who feel increasingly alienated because their
political institutions provide little relief and have drifted beyond their control. Growth, in short,
has failed to be inclusive.
The report of Ramos and Lammens (2013) in radam (2015) acknowledged the lack of a
clear definition of inclusive growth, this report attempts to comprehensively measure inclusive
growth at the country level using three indicators: poverty, inequality, and the employment to
population ratio (EPR). The authors highlight that poverty and inequality are already established
as measures of pro-poor growth and inclusive growth from an outcomes perspective, and that it
is EPR that adds an inclusive aspect to this measure through its participatory focus. EPR is used
as a proxy for economic participation, as productive employment is poorly defined and difficult
to operationalise due to lack of data. The analysis shows that most developing countries have
managed to increase their level of inclusiveness due to a decrease in poverty levels and no
increase in inequality. The authors argue that this increase in inclusiveness cannot be explained
by economic growth, as some countries showed high increases in inclusiveness with low growth,
and some of the countries with the worse inclusiveness performances had very high growth
rates.
Stott (2017) cited that, its win-win allure, promising a more prosperous economy
combined with more equitable society is proving irresistible. The dual emphasis on outcomes as
well as opportunities is what defines an inclusive growth agenda from a narrower inclusion
agenda. Connecting people up to the opportunities that exist in the labour market through better
education, transport and employment support is vital. But intervention is also needed to influence
the growth side of the equation. An inclusive growth strategy must seek to proactively influence
and shape the nature of employment opportunities. This includes boosting employers’ demand
for skills, shaping the occupational and sectoral make-up of the economy, and ultimately pushing
up levels of pay and improving terms and conditions of employment contracts.
Taylor (2016) apparently, the term "inclusive growth" originated in an essay "What is
Pro-poor Growth?" by Nanak Kakwani and Ernesto M. Pernia, which appeared in the Asian
Development Review in 2000. They use the term "inclusive" growth only once, and in a way
which makes it synonymous with "pro-poor growth." They write: "Broadly, pro-poor growth can
be defined as one that enables the poor to actively participate in and significantly benefit from
economic activity. It is a major departure from the trickle-down development concept. It
is inclusive economic growth."
Accroding to World Bank Group, Inclusive growth refers both to the pace and pattern of
growth, which is considered, interlinked, and therefore in need to be addressed together. The
inclusive growth definition is in line with the absolute definition of pro-poor growth, but differs
from it in the following ways:
(i) Absolute pro-poor growth can be the result of direct income redistribution schemes, but for
growth to be inclusive productivity must be improved and new opportunities for
employment created.
(ii) The pro-poor growth concept has traditionally focused on growth and poverty measures
whereas inclusive growth focuses on an ex-ante analysis of the sources of, and constraints to
sustained, high growth and poverty reduction.
Policies for inclusive growth are an important component of any government strategy for
sustainable growth and the frameworks for inclusive growth analytics are eclectic in spirit. The
main instrument for a sustainable and inclusive growth is assumed to be productive employment.
Employment growth generates new jobs and income for the individual - from wages in all types
of firms, or from self-employment, usually in micro firms - while productivity growth has the
potential to lift the wages of those employed and the returns to the self-employed. The ability of
individuals to be productively employed depends on the opportunities to make full use of
available resources as the economy evolves over time. The analysis therefore looks at ways to
strengthen the productive resources and capacity of the individual on the labor supply side as
well as ways to open up new opportunities for productive employment on the labor demand side.
The inclusive growth approach takes a longer term perspective. With this longer term
perspective, it is important to recognize the time lag between reforms and outcomes. Inclusive
growth analytics is about policies that should be implemented in the short run, but for sustainable
inclusive growth in the future.
Zhuang (2008) in Radam 2015 Inclusive growth is also defined by several countries
distinctly such as “harmonious growth” by the Peoples Republic of China. Inclusive growth for
PRC or what is understood as “harmonious growth or society” requires “continued reforms to
keep growth high and sustainable, carefully designed redistributive policy to promote equal
access to opportunities, and good governance and strong institutions to ensure economic and
social justice and an even playing field”
Shared Growth
Barclays Africa Group explained and defined shared growth they stated “We are
committed to Shared Growth which, for us, means having a positive impact on society and
delivering shareholder value.
In recognizing the critical link that exists between our success and society’s progress, we seek to
deliberately apply our substantial resources to address key societal challenges and unlock socio-
economic solutions through innovative programmers, commercial products, services and
partnerships. In order to do so we are focusing on the following three areas”
In the Seoul Development Consensus for Shared Growth they stated that This Framework
was borne of a recognition that for the world to enjoy continuing levels of prosperity it must find
new drivers of aggregate demand and more enduring sources of global growth. We recognize as a
crucial part of this exercise that we need to enhance the role of developing countries and low
income countries (LICs) in particular, for the following reasons:
· First, because for prosperity to be sustained it must be shared.
· Second, because we acknowledge that the impact of the recent crisis demonstrated a global
interconnectedness that is disproportionately affecting the most vulnerable in the poorest
countries. It has been estimated that, as a result of the recent crisis, an additional 64 million
people will be living in extreme poverty (i.e., living on less than USD 1.25 a day) by the end of
2010. We therefore have a responsibility to fulfill.
· Third, as the premier forum for our international economic cooperation, because the G20 has a
role to play, complementing the efforts of aid donors, the UN system, multilateral development
banks (MDBs) and other agencies, in assisting developing countries, particularly LICs, achieve
the Millennium Development Goals (MDGs). Our role must relate to our mandate on global
economic cooperation and recognize that consistently high levels of inclusive growth in
developing countries, and LICs in particular, are critically necessary, if not sufficient, for the
eradication of extreme poverty.
· Fourth, because the rest of the global economy, in its quest for diversifying the sources of
global demand and destinations for investing surpluses, needs developing countries and LICs to
become new poles of global growth – just as fast growing emerging markets have become in the
recent past. Our overarching objective of helping LICs improve and maintain the levels and
quality of growth, thereby reducing poverty, improving human rights and creating decent jobs,
requires strengthening the relationships among high, middle and low income countries. This
entails 2 promoting sustainable economic, social and environmental development; honoring
equity in the partnerships that exist; building stronger and more effective partnerships among
advanced countries, emerging countries and LICs; engaging the private sector and civil society;
and refocusing our priorities and efforts to remove the bottlenecks for LIC growth. We further
believe there is no “one-size-fits-all” formula for development success and that developing
countries must take the lead in designing and implementing development strategies tailored to
their individual needs and circumstances.
The annual report of Accelerated and Shared Growth Initiative for South Africa (2007)
reported that some of South Africa’s notable achievements towards AsgiSA objectives are:
• raising the growth rate to an average of over 5% in recent years
• increasing the rate of investment to over 20% of gross domestic product from 15%
• increasing the rate of investment of government to over 10% annually, and that of public
enterprises to an even higher level • introducing effective tracking mechanisms for government
projects
• reducing unnecessary red tape, for example in the implementation of ETAs
• getting universities to commit to rapidly increasing their output of engineers over the next three
years
• developing new pathways to more than double the annual output of artisans
• developing and introducing key new sector strategies and an industrial policy action plan
• developing amendments to the Competition Act, 1998 (Act 89 of 1998)
• implementing successful programms in the form of Project Consolidate and Siyenza Manje to
support the strengthening of municipal management
• reducing the volatility of the currency and the severity of interest rate cycles.
The evidence indicates that progress is being made, especially in infrastructure
investment. And because of this, our faster growth rate exposes new areas that need attention
almost daily. This means that the shared growth in Africa is effective in uplifting the economic
condition of the countries.
As stated by the Chung Un Chan (2013) Shared growth is the first step
toward a beautiful accompanied journey as it literally means “growing together.”He emphasized
that shared growth should not be limited to the economic area. He gave an example of a shared
growth model, which is the ‘regional balancing selection system’ introduced in 2005 when he
was SNU President. In this system, the number of high schools that produced more than one
successful applicant went up to 1,000 from 700. What underlies the idea is that indirect
experiences through the exchange of varied regions, environments and dispositions enrich
students’ creativity.
According to Ghana Shared Growth and Development (2010-2013 framework) its priority
policies to ensure and sustain macroeconomic stability focuses on:
a) improving fiscal resource mobilization;
b) improving public expenditure management;
c) promoting effective debt management;
d) ensuring price and exchange rate stability;
e) improving export competitiveness;
f) diversifying and increasing exports and markets; and
g) strengthening economic planning and forecasting to ensure synergetic development of
strategic sectors.
This is a response to the general assessment of the overall policy environment which emerged
from the implementation of GPRS I indicated a positive and significantly stabilized
macroeconomic environment, with a potential for attaining higher rates of growth.
Shared Growth was not only applied in the economic system of a country, it was applied
to private companies also as stated in Doosan Engineering & Construction (2019) they promotes
shared growth with an aim to build a "virtuous partnership" system with partner companies for
strengthened competitiveness and shared growth as a global construction company for
infrastructure and plants. This is an attempt to grow out of the existing simple purchase/sub-
contract structure for much stronger partnership with suppliers by conducting joint R&D;
exchanging information on value engineering (VE) for construction; providing expert training
programs; strengthening liquidity management through financial support; and complying with
fair trade.
As said by Burgos in Argullo (2018) Economic ties between China and Latin America
over the past 10 years have shown shared growth free of political preconditions. Closer
economic relations with China have brought benefits to the region without interference in a
country's domestic affairs or demanding political concessions. China-led initiatives to fund
infrastructure and energy projects, as well as financing mechanisms such as swap agreements
that provide regional countries with more breathing room when it comes to managing their
foreign reserves. The great attraction of financial ties with China is that they do not impede your
growth. On the contrary, they lend you money so that you can grow as a country. In a recent
report, the International Labor Organization (ILO) said China has generated 1.8 million jobs in
Latin America through trade, investment and infrastructure projects over the past 20 years.
Chinese enterprises have focused their investment on telecom, agri-food manufacturing and
renewable energy, helping improve infrastructure and diversify consumption in the region,
Minister Morneau of Canada Talks Equality, Shared Growth at G20, IMF and World
Bank Meetings he stated that by sharing Canada’s plan for economic growth with leaders from
around the world, Canada is setting an example. Canada is demonstrating that a strong economy
starts with a strong middle class. That includes taking steps to ensure that more people and
especially more women are able to find and keep good jobs, and benefit from the economic
growth they help create.
References
Inclusive Growth
Shared Growth