Economic development, growth and employment

Sustainable economic growth – a challenge for all

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Our information on the topics of economic development, growth and employment is currently being thoroughly revised. An updated version will be available here shortly.

Construction of a house in Ecuador.

There can be no sus­tain­able de­vel­op­ment without economic de­vel­op­ment. A suf­fi­cient­ly robust rate of eco­nom­ic growth is the absolute pre­con­di­tion for reducing pov­er­ty and attaining prosperity. But economic growth must benefit all sections of society, i.e. it must be inclusive and ecologically sus­tain­able.

Provided this is the case, economic de­vel­op­ment can have an impact that goes well beyond the con­fines of eco­nom­ic growth per se, and can help achieve many de­vel­op­ment goals. For ex­ample, en­sur­ing that indi­vid­uals have pro­duc­tive work that gives them prospects at personal level and within society also fosters security and peace. Employment and an income they can live on allow families to give their children a better education and break out of the vicious circle of pov­er­ty.

At the same time tax revenues are generated for the state, giving it more leeway. The pressure on ecosystems and the climate are lessened if growth is geared to con­serv­ing natural resources. In many de­vel­op­ing coun­tries this is par­tic­u­lar­ly im­por­tant because they, especially the more vulnerable sections of their populations, are disproportionately harshly affected by climate change and pollution.

Sustainable economic de­vel­op­ment is thus a way of ensuring inclusive pro-poor de­vel­op­ment.

The German contribution

In the promotion of sus­tain­able economic de­vel­op­ment, German de­vel­op­ment co­op­er­a­tion concentrates on delivering advisory services on economic policy, fostering the potential of the private sector and supporting co­op­er­a­tion coun­tries in their efforts to put in place stable financial systems. Vo­ca­tion­al training systems and properly func­tion­ing labour market insti­tu­tions enable people to benefit from eco­nom­ic growth and from the coun­try's increased prosperity. Activities in this area are geared to creating jobs and reducing pov­er­ty, and are often complemented by direct employment promotion measures.

German de­vel­op­ment policy takes its lead from the principles of the social and ecological market economy. As well as ensuring sound economic, political and social living conditions for the popu­la­tion, measures aim to con­serve the natural resource base on which life depends for the gene­ra­tions to come. The goal is to put in place a market order in line with the pre­vail­ing con­di­tions in the co­op­er­a­tion coun­try, that also embraces a social element.

Sustainable economic de­vel­op­ment is one of the priority areas most fre­quent­ly agreed on between the Federal Republic of Germany and co­op­er­a­tion coun­tries, especially in Africa and Asia. Between 2003 and 2010 the Federal Ministry for Economic Co­op­er­a­tion and De­vel­op­ment (BMZ) pledged an average of some 613 million euros every year for this field of activities.

BMZ glossary

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