Countries must focus on socio-economic reforms despite deepening global instability and escalating conflict in the Middle East, said Anna Bjerde, Managing Director for Operations at the World Bank.
“We must now also consider the ongoing developments in the Middle East, which are causing price shocks for fuel and fertilizer. This could slow growth, affect employment, increase inflation and exacerbate food security“, she stressed at the China Development Forum, being held in Beijing on March 22-23. “But managing this uncertainty is only half the battle. Countries must continue to invest in reforms to turn stability into opportunity.“
Bjorde said that in the next 10-15 years, the global labor market will increase by 1.2 billion people, thanks to the younger generation, most of whom live in low- and middle-income countries. “These young people, with their energy and ideas, will shape the next century. According to current projections, however, only about 400 million jobs will be created during this period globally“, she said.
The World Bank Managing Director stressed that fiscal reforms do not necessarily mean austerity and should be seen as “preserving the potential for investing in people, opportunities and resilience, even in an increasingly volatile global environment“.
Bjorde recalled that according to the bank's forecast, global GDP growth in 2026 will be 2.5%, while in developing countries it will be about 4%. “These indicators are simply not enough to bring developing countries closer to the level of developed economies. They are not enough to create the number of jobs needed to meet demographic needs,“ she added.
The Director pointed to the need to attract investment in energy, transport, digitalization, education and health, which “lay the foundations for productivity and opportunity“. She also stressed the importance of creating a conducive business environment, noting that in many countries “unclear rules and regulations hinder entrepreneurship and investment“. Bjerde stressed the importance of improving governance and creating a predictable regulatory environment, as this is “crucial for companies to invest, grow and develop“. She also mentioned the importance of attracting private capital, as the task of creating new jobs “far exceeds the capacity of public resources“.