Building With Resilience — Sustainability and Inclusive Growth Should Be the Touchstones for 2023

The current era is defined by the interplay of complex disruptions, influencing each other with long-term consequences. As seen through the deliberations in Indonesia last year and Davos more recently, certain congruence has been reflected in building resilience. Global leaders must address people’s immediate and critical needs while laying the groundwork for a more resilient future by enabling global sustainable and inclusive growth across countries and communities.

The 2023 annual Davos meeting happened in the backdrop of climate change, COVID-19, a weak recovery, the danger of stagflation and perils of protectionism, and Russia’s invasion of Ukraine. Acknowledging world-shaping events overlapping in time, the summit was held under the vastly apt theme of “‘Cooperation in a Fragmented world.” A message critically reinforced at the World Economic Forum’s Annual Meeting was the inextricable linkage of the energy transition, climate crisis and food security. While most business leaders have expressed cautious optimism with some upbeat about the economy, the central banks of the major economies cautioned that concerns remained.

Another aspect that was raised was environmental and climate change issues. The climate-related talks touched on a range of topics, including the rising tide of climate litigation, artificial intelligence for climate adaptation and innovative financing mechanisms for net-zero projects. While climate change has long been a recurring theme at Davos. Events over the past years have made clear that climate change is a truly global challenge, with the risks impacting all countries of the world. Climate change is a complex, multi-factor and urgent global challenge with long-term implications for the sustainable development of all countries. However, it is critical to note that climate’s effects are not uniform at the global level. The Global Climate Risk Index 2021 indicates that the poorest countries of the world, are most susceptible to the damage produced by climate change.

Global South and Magnified Socio-Economic Impact

Beyond the macroeconomic impact, the economically vulnerable and poor people are likely to bear the brunt of the economic shock from the impact of climate change. These could be in the form of higher fuel and food prices at a time when fiscal resources in developing countries are already stretched due to the ongoing pandemic. Climate change threatens to widen already-existing global inequalities, thereby undermining efforts for poverty reduction with potentially up to 132 million people being pushed into extreme poverty by climate change by 2030. Given the interconnectedness and cascading impact of climate change impact and marginalized communities, especially in the global south. This begets the need that along with the crucial deliberations of sustainability, the principle of inclusivity at a global scale. Looking at resilience and addressing these would foster economic stability and nudge forward the pursuit of the 2030 Agenda for Sustainable Development.

While in today’s multi-polar world, where the boundaries between the Global North and South are getting blurred due to the realignment of interests, the recent “Voice of the Global South” summit has brought back the focus on the global South- bringing together 120-odd developing countries. Furthermore, continuing the focus on the global South, India assumed the presidency of the G20 on 1st December 2022. This is the first time that the troika is consisting of three developing and emerging economies- Indonesia, India and Brazil.

With India is raising the concerns of the global South at international platforms, the G20 presidency comes at an opportune time to ensure challenges and issues of the developing world have platforms geared towards inclusivity of approaches and global frameworks. India’s G20 agenda is shaped by listing diverse subjects including green development, lifestyle for the environment, digital transformation, inclusive and resilient growth, and women-led development for the discussions over the year.

While aspects of investments, innovation, policy and finance all play a central role in defining the economic growth model of the 21st century, the central dimension of “building back better” is people-centred growth that focuses on well-being, improves inclusiveness, and reduces inequality for resilient economic recovery. In this case, resilience pertains to public and private sector organizations and whole economies and societies.

A resilience framework will, by design, foster the cooperation of public and private-sector organizations in supporting sustainability and inclusiveness across societies if action is to be on time and at scale. International cooperation around policies, technology and finance based on a resilience framework would help leaders identify areas for preventative action, protective investments and public-private cooperation. Global South actors need to be actively included in the decision-making of global action and partnerships if the 2023 Davos commitments are to be realized.

With the scope set, international cooperation among countries is expected to be geared towards a resilient future, however, it needs to ensure the inclusivity of voices to have a truly global framework.  With all eyes on the G20 summit, India has the opportunity to position itself as the voice of the developing and the less developed countries in the world.