The final countdown for CHOGM has started. With thousands of delegates expected to head to Rwanda together with business leaders, civil society groups and leaders as well as heads of governments, the Commonwealth family will come together to discuss the present and future challenges and opportunities.
The crisis triggered by Covid-19 has exposed many weaknesses of the current socioeconomic system: job insecurity for many people, the increase in remote work, the emphasis on essential professions needed to ensure public and vital services, the difficulties felt by healthcare systems in responding to the pandemic as well as a fragile economic web of interconnected economies. In addition, ecosystems are constantly being degraded and greenhouse gases continue to soar, leading to climate change and causing sea level rise, stronger storms, droughts, and wildfires that threaten entire countries, particularly small island states.
The current social, economic, and environmental changes, the ones stemming from the Covid-19 pandemic and the ones that were presented before, bring new challenges and demand reflexive analysis.
The need to respond to the current social changes has triggered a growing international movement of people and organizations at the intersection of the ecology, civil rights and participatory democracy social movements. These relatively new initiatives are often test beds for new forms of cooperation and solidarity that appear to be flourishing. For example,
There is now a wider appreciation of basic societal services like universal income and health.
There is also progress in the adoption of new online work models, such as online education.
The pandemic has also led to unprecedented government actions, demonstrating what it is possible to achieve when there is a will to act.
The pandemic crisis brought about a new opportunity to start a transformation towards a radically different kind of society. However, if we are not fated to go back to normal, we need disruptive changes and a new vision for social innovation. In fact, this is the global need for a transformative movement across a number of key pillars which I believe will be critical for CHOGM to examine. These pillars are: well-being economy, education, finance & banking, future of work, leadership and technology.
Well-being economy
Many of the social and economic problems we witness today have their roots in a deep ecological divide between humans and nature. While it is true that there have been significant improvements in eco-efficiency that will continue in the context of the European Green Deal, these gains will not compensate for the current rate of economic expansion, which will lead to higher natural resources usage. Today, we use more ecological resources than nature can regenerate, and carbon dioxide emissions into the atmosphere continue to grow. Here, CHOGM needs to start a movement towards a greater focus on the economics of well-being by moving away from a sole GDP metric. The work on the Universal Vulnerability Index is commendable in this regard however more advocacy is needed as well as support for member states to start thinking more in terms of well-being. Closely related to this concept is the need for energy diversification and a greater use of renewable energy. The blue economy presents unique opportunities for islands to truly diversify economies whilst embedding them within a well-being context.
Education
Sustaining the capacity of human talent is critical to any economy and as the world continues changing requiring new skills and talents, education will remain as the strongest policy to build economic social development. Building the right capacity and skillsets of present and of the future workforce is central to any economic recovery and strategy. This needs to include the full spectrum including the current workforce to embrace tomorrow’s skills. The educational set-up needs to change accordingly to future-proof its population. The concept of lifelong learning needs to be entrenched to ensure that workforces develop a resilience to future changes. The digital transformation and Covid have shown that there are no boundaries to education and new technologies such as virtual reality, augmented reality and online learning platforms can bridge the divide that exists. Capacity-building within the public service and regulators will be key in sustaining the attractiveness of a jurisdiction and economic hub. The workforce of the future is changing rapidly together with the requirements needed and this needs to be reflected in the educational systems and structures to truly future proof an economy.
Banking & finance
The disconnect between the financial and real economy produces financial bubbles that are at the root of global economic crises, e.g., the US real estate crisis in 2006, which was followed by the world financial crisis in 2008, and the Euro crisis. Money is a tool for the exchange of goods and services, and it cannot exist unless there are goods produced and
resources to produce them; meaning, money has no value without the real economy that it relates to. However, the financial sector treats money as a product. Money itself has become the most traded and profitable product. For development to be truly entrenched, we need to have a financial system that is built to serve citizens and people. Fintech and blockchain together with cryptocurrencies can serve this purpose and here CHOGM needs to look at fintech as a source of financial innovation and inclusion which can support people in their development. Fintech is also a growing economic sector which knows no boundaries and can serve as a key economic sector for small states with a complete ecosystem mushrooming out of it.
Future of work
While unemployment was already one of the most perplexing problems in the economic
system before Covid-19, today it is clear that the impact of the pandemic on jobs
has been worse than expected—particularly in developing countries with no public means to support workers. However, the problem is much more complex as the quality of work of those who managed to maintain their paid employment appeared to be downgrading even before the pandemic. In some sectors, value creation spreads over long and global value chains to the point that work contribution is so diluted that it loses "meaning”. Human work needs meaning and cannot be taken as "renting time” or "working for money”, as people need a connection to their work. One important aspect that needs to be highlighted is that, in the future, there will be a probable shrinkage in the number of jobs and a different skill set required by companies. Therefore, countries need to future-proof their workforce and ensure that their workers are prepared for the future.
Leadership
Leadership and new governance mechanisms are nowadays key aspects in the transition to a more ecological and inclusive society. In fact, unforeseen disruptive events are likely to be more frequent in today’s world, and therefore, leaders in general and high-level
leaders in particular face new challenges but often appear to fail to anticipate change. The increasing frequency of leadership failure suggests that the established ways of decision making in major companies, civil servants or ministerial cabinets are no longer working. On a national level, the concept of good governance becomes critical. Good governance starts from a recognition that the nation is led for the benefit of others with an obligation of accountability. Leaders are entrusted with authority to manage and to deliver to their citizens, but they must have the courage, humility, and self-control to put in place checks on their authority. In short, governments must, as the World Bank put it, be "epitomized by predictable, open and enlightened policy making; a bureaucracy imbued with a professional ethos; an executive arm of government accountable for its actions; and a strong civil society participating in public affairs; and all behaving under the rule of law.”
Technology
Covid has accelerated the adoption of technology by individuals, firms, and governments. For an economy that has already embraced and understood that technology will provide the right competitive advantage, the increased adoption of technology will not come as a surprise. Going forward, authorities need to ensure that the digital transformation deepens and that the vision is built around becoming a digital society whereby community life, business life and life as citizens become completely intertwined. Where possible, blockchain technology needs to be adopted by the public service to ensure an added level of trust and efficiency whilst transforming government to be digital to the core. All sectors have the potential of embracing technology including agriculture and the coming together of AI, IoT and blockchain can usher in a digital revolution. This will also support the establishment of a strong innovation ecosystem which will attract start-ups as well as researchers in developing new products and services.
Transformation is all-encompassing. It is a mindset that is needed to future-proof our societies and economies. Transformation is about resilience as well as nurturing the ability to identify and reap opportunities. Transformation is also complex and requires support. To this end, I believe that CHOGM needs to focus on offering the support required for countries to embark on transformation projects and exercises. A Commonwealth Transformation Lab will be able to bring together experts, academics, policymakers together to discuss best practice models and to support countries in their transformation efforts. Rwanda, a shining example of what transformation is all about, is best placed to champion this initiative.
The writer is a co-founding partner of Seed, an international research-driven advisory firm. He will be speaking at the Commonwealth Business Forum.
www.seedconsultancy.com | jp@seedconsultancy.com