How inclusive is Inclusive Growth?

Over the last few years ‘inclusive growth’ has become an increasingly dominant theme in development thinking and policies. Multilateral banks, as well as other multilateral and bilateral organisations, all see ‘inclusive growth’ as a central policy. Last week the Centre for Poverty Analysis (CEPA) hosted its first forum under the CEPA Café Series on the theme ‘How inclusive is Inclusive Growth?’ The interactive forum featured a presentation by Professor R.L. Stirrat, - an independent consultant and Research Fellow at the University of Sussex – and a discussion led by Dr. Nimal Sanderatne a Senior Fellow at the Post Graduate Institute of Agriculture and Member of CEPA.

Professor Stirrat pointed out that the term inclusive growth first appeared in India’s 11th five-year plan which targeted ‘ not just faster growth but also inclusive growth, that is, a growth process which yields broad-based benefits and ensures equality of opportunity for all’.

Since then, the precise meaning of inclusive growth has continued to be unclear while the most explicit statements of what is involved in achieving inclusive growth are somewhat worrying. This is particularly clear in statements from the World Bank which point out that the ‘equity’ and ‘inclusiveness’ which the concept appears to promise relate to opportunities and not outcomes. A survey of ADB publications reveals three varying definitions or approaches to the term: declining inequality, pro-poor investments in social opportunities and equal opportunities and equal access. The most salient feature across the board lies in the emphasis on equal opportunity (as opposed to equal outcomes). Dr. Nimal Sanderatne attempted to identify some reasons as to why poverty persists despite the continued understanding/recognition of the need for inclusive growth. He cited China and India as examples of economies which had attained significant economic growth in recent years but still continued to have a large proportion of their populations living in poverty, unable to benefit from the overall economic growth the countries had experienced. He attributed this to a large number of people not having access to the opportunities provided by economic growth and to the uneven distribution of assets. Dr. Sanderatne emphasised the need for equal opportunities to make inclusive growth possible using the existing education system in Sri Lanka as an example as it allowed individuals from different backgrounds to avail themselves of the free education from primary to university level and achieve socio-economic mobility. The event ended with a lively discussion among participants on how the lack of equal opportunities could lead to the undermining of social peace.

(The Centre for Poverty Analysis (CEPA) is an independent Sri Lankan think-tank promoting a better understanding of poverty-related development issues. The CEPA Café hosts events in an informal setting, where people are free to exchange and expound their views on themes related to poverty, development and change. Events in the CEPA Café Series are based on talks, performances, screenings, readings or any other creative presentation that would inspire lively discussion.)