By encouraging private investment in infrastructure, we can spur growth in the developing world
Later this month the United Nations is expected to finalize its Sustainable Development Goals, a global action plan designed to end poverty and support long-term growth. One of the goals states, “Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation.”
In many parts of the developing world, from Asia to Latin America, a massive infrastructure shortfall may be the single most significant obstacle to human and economic development. Addressing it will underpin progress on many of the SDGs.
International Finance Corporation
Since childhood, Gircilene Gilca de Castro dreamed of owning her own business, but struggled to get it off the ground. Her fledgling food service company in Brazil had only two employees and one client when she realized she needed deeper knowledge about what it takes to grow a business. To take her business to that next level, she found the right education and mentoring opportunities and accessed new business and management tools.
- International Finance Corporation
- Goldman Sachs
- Small Businesses
- Overseas Private Investment Corporation
- Career & Money
- Income Inequality
- Gender Gap
- Private Sector Development
- East Asia and Pacific
- Latin America & Caribbean
- Congo, Democratic Republic of
- United States
- financial inclusion
I have been fascinated by the concept of frontier all my life. What brought us here? What’s next? As a kid, my favorite book was “Ten Thousand Whys,” a pop-science series with all kinds of seemingly trivial questions like “Why are there fewer stars in the sky in winter?”
I wrote my Ph.D. dissertation on the Production Efficiency Frontier Theory — how to identify the most efficient units in a production network and measure the technical frontier. Later I became more of a macroeconomist and my interest expanded to identifying countries standing on the growth frontier. Subsequently, I began studying the deepest thinkers and became convinced that humanity is on an important new frontier of cosmic evolution.
Can we envision a time when we will no longer be surprised to hear that a woman is leading an energy or technology company? Can closing the gender gap in leadership, especially in male-dominated industries, be a possibility in fewer than 100 years?
Today’s dynamic women in top leadership positions are opening up the possibility of answering these questions with a resounding “Yes!” They have shattered glass ceilings and paved the way forward for countless others trying to uproot deeply entrenched ideas about women’s and men’s differing roles and opportunities in business and society. As a result, more and more women are now recognizing and making progress towards transcending the glass walls that also silo them in certain managerial functions, such as human resources and communications.
However, a new report by the International Labour Organization (ILO) released last week reminds us that gender diversity gains are not always sustained. Featuring unique data collected from 1,300 private sector companies in 39 developing countries, the report states that concerted efforts are required to consolidate progress and change mindsets while fighting unconscious biases at all levels of society.
About 4.5 billion people in developing countries are low-income, living on $8 a day or less (in 2005 purchasing power parity terms). They are the so-called base of the economic pyramid (BOP) and constitute a $5 trillion consumer market. While case studies abound on many of the well-known multinationals trying to break into this market, the success of local businesses has often been lost in the discussion of “BOP business” to date. Why are we not learning from the companies that are already succeeding with the BOP?
Small and medium sized companies are the backbone of Latin America’s economy. They represent more than 90 percent of all enterprises in the region, generating over half of all jobs and a quarter of the region’s gross domestic product. They are essential to economic growth, yet their success is often blocked by one key obstacle: lack of credit. Nearly a third of companies in the region identified lack of credit as a major constraint, according to recent surveys.
Take the case of Sonia Arias, who owns a small textile business in Medellin, Colombia. When she opened her business seven years ago, she took an informal loan that left her with sky-high interest rates and little cash to reinvest. “When I was paying these loans,” she said, “it felt like we were being hit with a stick.”
The global apparel industry has been forced to face some tough and unpleasant realities in recent years, and has been criticized for engaging in a “race to the bottom” especially as it relates to the conditions under which some garments are manufactured.
Companies that include women among their executives and employees and do business with female entrepreneurs gain in terms of profitability, creativity, and sustainability, speakers said at the World Bank Group’s Gender and the Economy event this week in Washington, D.C.
A convincing business case for gender inclusion was made by H.E. Sheikh Abdullah al Thani, chairman of Ooredoo Group; Cherie Blair, founder of the Cherie Blair Foundation for Women; and Beth Comstock, senior vice president and chief Marketing Officer at General Electric.
“Women are bringing new insights and experiences to workplaces and markets that were previously male-dominated,” said Comstock “Diversity breeds innovation."
Sri Mulyani Indrawati, the Bank Group's managing director and chief operating officer, said closing the economic gender gap and increasing opportunities for both women and men in the private sector are key to ending extreme poverty and boosting prosperity in developing countries.
DAKAR, Senegal — One of the most important pieces in our new strategy is that all parts of the World Bank Group need to work together more closely. In Dakar, I visited a new toll road that has cut down commuters' travel time and shows signs of boosting economic development at various exits. The project was supported by IDA, our fund for the poorest, and the IFC, our private sector arm. Please watch to learn more.