Rethinking development priorities in the post-coronavirus situation

During the next few years in the aftermath of Covid-19, development priorities should, and will, change. After the rapid spread of the novel coronavirus, economists and social scientists are talking about more sensible interaction among nations and a balance between globalisation and self-reliance.

But the reality may be different from the rational views emerging from these debates. Moreover, concerns of higher income countries and the others will be different. Large countries with diversified production activities are obviously in a greater advantage compared to small countries.

However, in the coming years, most countries – rich and poor – are likely to work towards more self-reliance in terms of producing basic goods and services, especially food and health services. Bangladesh may as well do some rethinking about its development strategy both in the short and medium term.

Self-reliance in food

Ensuring food security requires attention to issues beyond immediate actions to mitigate hunger, which are already receiving attention from all relevant quarters. Access to adequate food by all walks of people, including the vulnerable, will require adequate availability at the aggregate level. The logic behind this needs elaboration.

Bangladesh has been more or less self-reliant in food for the last few years and it imports only a small part of the total demand for cereal, especially rice. But during the next one year, rice exporting countries will be cautious about export of food. Covid-19 has revealed the risks and uncertainties in trade and each country will try to minimise risks related to food availability.

Bangladesh must therefore aim to maintain adequate food supply, especially through adequate food grain production. The prospect of good harvest, which is usually anticipated early, discourage hoarding by middlemen and ensure availability for the poorer consumers. Moreover, an accelerated agricultural growth can contribute to GDP growth over the next two years while the other sectors gradually recover from the economic slowdown.

Diversify export

A structural change of the economy through acceleration of industrial growth will remain important. Change of priority in this context should consist of an emphasis on the diversification of exports. Policy documents in the past have mentioned this frequently, although no tangible change in the overwhelming dominance of RMG exports has been achieved.

As a result, this sector has been able to maneuver policy making. Their recent decisions of opening factories when the coronavirus infection has been on the rise have received criticisms. The arguments for export diversification are well known and its urgency does not need much elaboration.

Covid-19 has revealed that there can be definite advantages of regionally dispersed industrialisation. This can also help utilisation of local surplus labour. Policy incentives in this context should be a priority.

Priority of the health sector

In fact, the priority of the health sector is not only due to the focus on self-reliance. It demands attention from the perspective of both efficiency and equity.

In the past, quality health care was not a priority because it was assumed that the rich, and even the middle class, could go abroad and get better quality healthcare. Covid-19 has demonstrated that it may be impossible at certain times.

The priority of the health sector means attention to a number of aspects. First is access to universal health care (basic services) for all, including the low-income groups, remote areas, etc. Second is the need for specialised services in each division, or neighbouring Division, without having to travel to Dhaka or Chattogram. Third is the overall quality improvement in all types of public and private health care services.

Increasing public investment alone cannot ensure the above. More innovative approach by government, NGOs and the private sector are needed.

Inclusion of a goal in the eighth five-year plan or raising the share of GDP going to the health sector by the fraction of a percentage point cannot be sufficient. Health sector governance is a big problem. Otherwise the existing facilities, including district hospitals and upazila health complexes, would have delivered the required services.

Self-reliance in human capital

In the post Covid-19 period, there will be reduced mobility of labour, both skilled and unskilled. So, there is a need for taking steps towards self-reliance. This requires attention to not only quantity but also quality of education and skill development.

Quality of education at all levels including higher education must rise. During the present crisis, income loss by low-income groups will lead to decline of spending on education. This is likely to increase inequality in the quality of education between high and low-income groups, and may be especially detrimental to women's education.

Policies to compensate the loss of opportunities of education for students from low income families will be needed.

Domestic employment growth and reversing forces accentuating poverty and inequality

Employment creation for all groups will be a priority when the spread of Covid-19 halts, or at least the curve flattens. In the post Covid-19 period, when the economy is back to the normal track, those who lost employment must receive support to get new employment or restore the previous economic activity where one was self-employed.

There will be a larger addition to the labour force in 2021, since a backlog of new entrants of 2020 who have been waiting for the labour market to start operating again will join. In addition, in the post-coronavirus period, there will be uncertainty about overseas employment which will add to the swelling of the domestic labour supply.

The rise in supply may result in deterioration of quality of employment and lower wages. To reverse this trend, all means must be deployed to create productive employment for those who lost their micro or tiny enterprise due to Covid-19. For the families with potential labour force, employment with higher productivity/wage will be the best option to enable them to come out of poverty.

At the end, it should be mentioned that the above list of priorities is by no means a comprehensive one. Discussion and debate around these issues and inclusion of more items – for example, emphasis on environmental sustainability – will be necessary. Also, the priorities may change if Covid-19's effect and duration is unexpectedly disruptive.

But the change of development priorities will require a drastic change in the policy planning process. This presupposes an attitude to accept changes in the development philosophy.

The author is the executive chairperson at the Centre for Development and Employment Research (CDER).