Vientiane, 12 May 2017
Effective governance and improved fiscal management are essential to sustaining robust economic growth and improving its quality, the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) says in its annual flagship report. The Economic and Social Survey of Asia and the Pacific 2017 highlights that despite a broadly positive economic outlook for 2017, Asia-Pacific economies are vulnerable to rising global uncertainty and trade protectionism.
Photo: UN Lao PDR / Lou Sensouphone
As nations move into the second year of implementing the 2030 Agenda with the Sustainable Development Goals at its core, the region’s developing economies are projected to grow at 5.0 and 5.1 per cent in 2017 and 2018 respectively, up from 4.9 per cent last year, according to the Survey.
The projected moderate Asia-Pacific economic growth faces risks from restrained international trade through rising protectionism and global uncertainty. The Survey estimates that a steeper-than-anticipated increase in these factors could reduce average regional growth in 2017 by up to 1.2 percentage points.
Lao PDR’s economic growth has remained high at 6.9 percent in 2016, mainly propelled by construction in the hydropower sector. The growth outlook is set to remain stable at 6.8-6.9 percent in 2017 and 2018. Rising mining profits would help support government revenue. According to ESCAP, the medium-term outlook would likely benefit from the Government’s effort to promote foreign investment and the ongoing construction of a high-speed railway between Vientiane and the Chinese border, which will enhance cross-border connectivity.
Launching the Survey in Bangkok, United Nations Under-Secretary-General and ESCAP Executive Secretary Dr. Shamshad Akhtar emphasised that better governance for effective mobilisation and use of fiscal resources is critical to advancing the 2030 Agenda for Sustainable Development. She also mentioned that future economic growth will need to rely more on productivity gains rather than only increasing the quantity of production resources.
“Sustained productivity gains, in turn, will require effective institutions and better governance. In addition to ensuring sustained and robust economic growth, policymakers will need to address social and environmental challenges in order to improve the quality of this growth,” said Dr. Akhtar.
The quality of governance also impacts revenue mobilisation, as willingness to pay taxes is influenced by public perception of government expenditure efficiency. The Survey further highlights the importance of transparency and accountability for better governance, and advocates for the production and dissemination of key fiscal data and development of capacity to monitor, evaluate and audit policies as essential to effective governance.
Download the Survey: http://www.unescap.org/publications/economic-and-social-survey-asia-and-pacific-2017
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