Accessibility Assistant

Make Widget Bigger

Text to Speech

  • Simply select any text on the page to have your computer read it to you.

  • Choose the preferred Text to Speech accent from your available system voices.

Text Controls

Visibility Options

Highlight Links (H)

Translate this page

Color contrast Checker

1. World development challenges 2. Quality-adjusted human development 3. Environmental sustainability 4. Good governance 5. Main conclusions and policy implications 6. Full Report, Annex, References
text

World Development Challenges
Development from a broader lens


Foreword


Over the past three decades, the world has transformed. People’s aspirations have changed and so have their development challenges. The global geopolitical landscape has shifted, broadening endorsement of collective approaches such as the Millennium Development Goals and the Sustainable Development Goals (SDGs).

Deepening and emerging challenges have spurred us to write this report as a contribution to ongoing global dialogue on development progress beyond gross domestic product (GDP). It also provides a tool for countries to re-evaluate development outcomes and pursue constructive regional and national discussion on related policies. The report proposes a new global Development Challenges Index (DCI) that measures shortfalls in desirable achievements in three areas: the quality of basic human development, environmental sustainability and good governance.

One of the main findings is that governance is one of the world’s most pressing development challenges. The only challenge on the rise globally, it contributes most to a poor showing on the DCI. This is largely due to increased shortfalls in democratic governance over the past two decades, not so much because of gaps in effective governance.

Another core insight centres on the significant share of the world’s population living in difficult conditions with serious development challenges. Only 15 countries have a very low level of challenges; 49 countries face high and 25 countries very high challenges.

Globally, serious deprivations in the quality of human development remain. No region has a very low score on qualityadjusted human development challenges. Much must still be achieved, even in the two most developed regions of the world, Europe and North America. Education challenges comprises the most significant share of quality-adjusted human development challenges in most regions, followed by income challenges.

Environmental sustainability remains a major global concern even as regions have shown little sign of progress. The burden of increased climate change and energy intensity is higher for North America, and to a lesser extent for Europe and Central Asia, while the burden of poor environmental health is the main concern for developing regions.

As the ultimate aim of this report is to trigger policy debate, we hope it will lead to follow-up dialogues to address fundamental challenges at the global, regional and, most importantly, national levels.

Rola Dashti,
Executive Secretary
UNESCWA

img

Key messages


The report offers four main findings:

1

A significant share of the world population still lives in difficult and in some cases deteriorating development conditions.

2

There is still much to be achieved, especially in terms of the quality of human development, even in the richest regions.

3

Environmental sustainability is a major concern for both developed and developing countries.

4

Governance is the world’s most pressing development challenge.

Addressing these challenges requires action on four policy fronts:

img

Strengthen environmental and health systems to improve healthy life outcomes.

img

Build knowledge-based economies with integrated education and labour market systems.

img

Forge strong links between government effectiveness and democratic governance.

img

Prioritize the most challenged countries and ensure human security in conflictstricken countries.

1. WORLD DEVELOPMENT CHALLENGES

Development Challenges Index


The proposed DCI measures shortfalls in three development achievements: basic wellbeing freedoms as measured by the three quality-adjusted dimensions of the traditional HDI; environmental sustainability and good governance. In line with the report’s conceptual framework, each of the challenges and their dimensions are awarded an equal weight. To maintain simplicity, the report authors used an arithmetic average rather than a geometric one, given good reasons for doing so when many indicators are involved. This also leads to an index that is easy to compute and interpret.


text
text
text
Framework for the DCI’s three sets of challenges to development
img

Source: ESCWA.
* The income inequality indicator has been used given its role as a determinant of poverty and due to the lack of comparable poverty data (for instance, fixed poverty lines suffer from several problems and limitations). Therefore, when better poverty data becomes available, it will be used instead of income inequality to discount the income component.

Constructing the DCI involves two simple steps. The first entails a conversion from achievement indicators to challenge indicators by subtracting the former from 1. The second step is to take the simple average of the indices reflecting the challenges (figure 1).

Figure 1. Calculating the DCI

img

Source: Abu-Ismail, Hlasny, Jaafar and others, 2022.

A modest reduction in global development challenges


DCI reductions have occurred globally, from an average of 0.485 to 0.437, and across most regions. East Asia and the Pacific achieved the greatest reduction (figure 2). Sub-Saharan Africa is the most challenged region with an average DCI score of 0.553 in 2020; North America, with a score of 0.249, is the least challenged region. The Arab region and South Asia are highly challenged, lying well above the world average. They show conspicuous gaps in DCI levels compared to Latin America and the Caribbean and East Asia and the Pacific.

Figure 2. DCI regional scores and shares of the three challenges, 2000 and 2020

Source: ESCWA calculations.

The graduation of East Asia and the Pacific from the high- to the medium-challenge group has led to a significant drop in the share of the world population living with significant challenges, from 60 per cent in 2000 to 36 per cent in 2020. There has been little movement in the very high- to highchallenge group, however (figure 3).


Figure 3. Population in each DCI category by region, 2000, 2010 and 2020
Source: ESCWA calculations.
img img

Correlations with other global indices


Nearly all 20 of the highest-performing countries on the HDI are in the least-challenged group of the DCI, with very high rank and score correlation. For the Nordic and most Northern European countries, the DCI will not make much difference. For medium and low HDI country groups, differences in scores and ranks are significant.

Although the SDGI’s overall correlation with the DCI is quite strong, the relationship diverges from the HDI (figure 4). This is not surprising since the SDGI includes more diverse dimensions and indicators to measure progress on the 17 SDGs.

Figure 4. The SDGI and the DCI


Source: ESCWA calculations and United Nations, 2021.
Note: The SDGI is an evaluation of each country’s overall performance on the 17 SDGs, weighting each goal equally. The score indicates a country’s position between the worst outcome (0) and the desired outcome (100).

2. QUALITY-ADJUSTED HUMAN DEVELOPMENT

The quality-adjusted human development challenge index measures shortfalls in achievements in healthy lives, quality education and equally distributed income. No region has a very low quality-adjusted human development challenge index, which means there is still much to be achieved even in the world’s most developed regions, North America and Europe and Central Asia. Sub-Saharan Africa faces very high challenges, followed by South Asia and the Arab region, which scored high and medium, respectively.

img img img

Main findings


As the most challenged region over the past two decades, Sub-Saharan Africa faces deprivations resulting from many factors, including poor governance performance, civil war and shocks such as the AIDS pandemic. Another region with high qualityadjusted human development challenges is South Asia although it also saw the greatest decline in these challenges from 2000-2020 (figure 5).

Figure 5. Quality-adjusted human development challenge index regional scores and dimension shares, 2000 and 2020

Source: ESCWA calculations.

Influencing factors


Three indicators particularly influence the quality-adjusted human development challenge index: the pupil-teacher ratio, the number of doctors and number of hospital beds per 1,000 individuals, and knowledge use in the economy, often captured by economic diversification and complexity indices.26 Countries striving to improve these variables generally show the best outcomes on the index.

img

1. Health and education system capacities and knowledge


There are high negative correlations between the healthy life expectancy challenge index and the capacity of the health system index, based on the simple average of the two indicators of the number of doctors and number of hospital beds per 1,000 individuals (figure 6).
Poor health and educational outcomes in many countries are a logical result of insufficient institutional capacities, such as a lack of nearby hospitals, doctors or teachers.

Figure 6. Healthy life expectancy challenge index and capacity of health system index


Source: ESCWA calculations.
img

2. Decent work and the Fourth Industrial Revolution


Employment is vital to quality human development achievements, especially the income dimension. Through employment, quality education can translate into higher and better-distributed incomes.

Decent work, income levels and distribution, and economic complexity correlate with each other. It is not surprising to see poor correlations between the unemployment rate and both the inequality-adjusted income challenge index and the vulnerable employment indicator. This contrasts with a strong correlation between the vulnerable employment indicator and the inequalityadjusted income challenge index (figure 7).

Figure 7. Inequality-adjusted income challenge index and the vulnerable employment indicator


Source: ESCWA calculations and World Bank data, https://data.worldbank.org/indicator/SL.EMP.VULN.ZS.
img

3. Gender equality


Education is among the most important aspects of gender inequality. While the gender gap has improved globally in the last few years, it is still prominent, especially for poorer and more challenged countries. Most countries still achieve fewer years of schooling for women than for men (figure 8). This gender gap is widest for countries with an average of less than 10 years of schooling, with a few exceptions such as Kuwait, Lesotho and Libya.

Globally, on average, women’s GNI per capita is $10,000 less than that of men ($24,458 for men compared with $14,441 for women). In average monthly wages, a woman in informal employment earns only 47 per cent of what a man in formal employment earns. Women in the formal sector earn only 79 per cent of what men in formal employment earn.

img
Figure 8. Male and female mean years of schooling

Source: UNDP, 2020.
img

4. Governance and quality human development: a mutual reinforcement


What makes some countries perform better on drivers of human development achievements? In short, they have good governance and institutional effectiveness, which equips them to create requisite policies and make them work.

Top performers on governance are generally also among the top performers on development, shown in the positive correlation between the governance challenge index and the quality-adjusted human development challenge index (figure 9).

Figure 9. Governance challenge index and quality-adjusted human development challenge index

Source: ESCWA calculations.

3. ENVIRONMENTAL SUSTAINABILITY

img

On the environmental sustainability index, most regions have a higher environmental health challenge than a climate change and energy efficiency challenge (figure 10). The former accounts for around 80 per cent of the environmental sustainability challenge in South Asia. The only two regions with a higher climate change and energy efficiency share are Europe and Central Asia and North America. In the latter, three quarters of its score comes from this dimension.

Figure 10. Environmental sustainability challenge index regional scores and dimension shares, 2000 and 2020



Source: ESCWA calculations.

Influencing factors


Governance influences environmental sustainability but the relationship is not straightforward. Overall, the governance challenge index seems to have a positive correlation with the environmental sustainability index. Governance seems to affect each component of the environmental sustainability index differently, however. It is negatively correlated with climate change, highlighting the fact that some of the richer countries with better governance systems, like Canada, Luxembourg, Singapore and the United States, are also among the world’s biggest emitters of greenhouse gases.

img
Figure 11. Governance and environmental health

Source: ESCWA calculations.
img
Figure 12.Healthy life expectancy and environmental health

Source: ESCWA calculations.

4. GOOD GOVERNANCE

img

Poor governance may be the world’s most pressing development challenge. It has far-reaching consequences affecting all other aspects of human development, particularly those related to economic prosperity and social and political stability. Against this backdrop, the present chapter sets out two key findings. First, governance is the most significant challenge in the DCI and the only component that is on the rise globally. Second, conspicuous regional and subregional gaps exist in key indicators of government effectiveness, particularly in the Arab region.

img

"Sub-Saharan Africa’s investment in health is particularly low, with expenditure at per cent of GDP in 2018 compared to a world average of per cent."

The largest share of the world’s population lives in countries scoring in the high-challenge group on the governance index, as in 2000 (figure 13). In 2010, the highest number of people was in the mediumchallenge category, prior to a noticeable deterioration through 2020. This trend was mainly driven by an increase in governance challenges in some Sub- Saharan African as well as European and Central Asian countries. The increase from a high to a very high level in some countries between 2000 and 2010, such as Iran and Sri Lanka, led to more people living in countries with very high governance challenges.

Figure 13. Population in each governance challenge index category by region, 2000, 2010 and 2020
Source: ESCWA calculations.

Influencing factors


img

1. Respect for human rights and basic freedoms


Democracy necessitates guaranteeing fundamental rights and freedoms to function properly. Moreover, laws and institutions are needed to protect human rights and freedoms. For this reason, human rights and good institutions tend to go hand in hand. Not surprisingly, there is a strong correlation between the governance challenge index and human rights and freedoms indicators, such as the simple average of the harassment of journalists and government censorship of the media, and the simple average of freedom from political killings and from torture (figure 14).

Figure 14. Freedom from political killings and torture

Source: ESCWA calculations.
img

2. Absence of conflict


A lack of human rights and freedoms prevents people from enjoying a decent life as do gaps in essential public services. Both can be major drivers of violence and conflict, which explains the strong correlation between the governance challenge index and the Global Peace Index produced by the Institute for Economics and Peace (figure 15). The peace index includes 23 quantitative and qualitative indicators on the level of societal safety and security, the extent of ongoing domestic and international conflict, and the degree of militarization. The strong correlation is a result of the association of the index with both democracy and effectiveness.

Figure 15. The governance challenge index and the Global Peace Index, 2020

Source: ESCWA calculations and Institute for Economics and Peace.

5. MAIN CONCLUSIONS AND POLICY IMPLICATIONS

Main conclusions

  • 1.

    Governance is the world’s most pressing development challenge

  • 2.

    Environmental sustainability is a major concern for both developed and developing countries.

  • 3.

    There is still much to be achieved, especially on the quality of human development, even in the richest regions.

img img

Policy implications

Policy message 1


Strengthen environmental and health systems to improve healthy life outcomes

img

Policy message 2


Build knowledge-based economies with integrated education and labour market systems to harness opportunities and minimize the negative impacts of the Fourth Industrial Revolution

img

Policy message 3


Forge strong links between government effectiveness and democratic governance

img

Policy message 4


Prioritize the most challenged countries and ensure human security in conflict-stricken countries

img

Full Report, Annex, References