Shaping the future of human development in times of crisis

Climate-related and other ecological disasters occur on an almost daily basis. It would be easy to dismiss these events as isolated incidents, minor impediments on the road back to normality. But this would be a mistake.

Layers of uncertainty are stacking up and interacting to unsettle our lives in unprecedented ways. We have faced disease, war, and environmental disruption before. But the confluence of destabilising planetary pressures with rising inequality, far-reaching economic and social transformation, accelerated technological change, and global political realignment presents complex and interacting sources of uncertainty for countries, communities, and individuals.

Understanding and responding deep-seated uncertainty is the theme of the 2021/2022 Human Development Report entitled “Uncertain Times, Unsettled Lives: Shaping our Future in a Transforming World”.

Jonathan Pincus Senior international economist United Nations Development Programme

The Human Development Report is commissioned annually by the United Nations Development Programme to explore emerging development issues from the perspective of their impact on people in the developing world, especially communities suffering deprivation and other forms of marginalisation. Since the first Human Development Report was published in 1990, it has helped UN members countries, development agencies, practitioners, and scholars maintain focus on the human impact of development and of other social, economic, and political trends.

This year’s report considers the multiple crises facing the world and our collective capacity to mitigate their impact on human development. Recovery from the pandemic has begun, but its effects are still being felt in every region.

Globally, between 600 million and a billion people were infected by the virus, and more than six million people have lost their lives. Job and income loss imposed severe hardship on the poor and near poor, and disruption to schools and universities resulted in a loss of momentum in education and training that will take years to reverse. Healthcare and community services were overwhelmed, and the quality of healthcare services largely declined.

Largely because of the pandemic, the Human Development Index (HDI) has declined globally for two years in a row for the first time in the 32-year history of the index. Human development has fallen back to its 2016 levels, reversing much of the progress towards the Sustainable Development Goals. Over 90 per cent of countries registered a decline in their HDI score in either 2020 or 2021 and more than 40 per cent declined in both years, signalling that the crisis is still deepening for many.

A series of new and pre-existing crises have compounded the adverse effects of the pandemic and slowed the recovery. Extreme weather events associated with climate change, armed conflict in Europe, soaring energy and food prices, rising protectionism, and political instability have complicated efforts to regain development momentum lost during the pandemic.

The Human Development Report argues that these multiple sources of uncertainty interact to unsettle life in unprecedented ways. While some countries are beginning to get back on their feet, recovery is uneven and partial, further widening inequalities in human development. Latin America, the Caribbean, Sub-Saharan Africa, and South Asia have been hit particularly hard.

So, what can we collectively do in a world of uncertainties?

The report charts a course out of uncertainty and toward a new, sustainable and equitable development trajectory. The report recommends policies that focus on investment in renewable energy, preparedness, and insurance, including social protection, to mitigate the impact of uncertainty and to build the capacity needed to respond to new challenges.

Unlike most developing countries, Vietnam managed to sustain economic growth during the most difficult years of the pandemic. Although the average pace of growth slowed, and vulnerable groups and individuals suffered periods of real hardship, a major reversal of human development progress was avoided.

Vietnam’s HDI value of 0.703 in 2021 was essentially unchanged from 2019, and the country climbed two places in the global ranking from 117 out of 189 countries in 2019 to 115 out of 191 countries in 2021.

Looking ahead, Vietnam is well placed to regain the loss of momentum resulting from the pandemic and manage the uncertainties associated with the cascading crises described in the report. The rapid and universal roll-out of vaccines has enabled life to return to normal and reduced pressure on hospitals, clinics, and schools. Government policy has been flexible and adaptive, which has made it possible for industries like tourism and transport to post an impressive recovery in 2022.

However, Vietnam faces many challenges, most notably climate change. It is anticipated that rising sea levels and more frequent extreme weather events will displace people and their livelihoods, seriously affecting the level of human development in vulnerable regions.

Vietnam’s economic development depends heavily on growth trends in the rest of the world. War in Europe, rising prices, and disruption to global trade patterns are important sources of uncertainty. Vietnam will need to increase investment in infrastructure, education, training, and research to increase national resilience and capacity to adjust quickly and flexibly to changing global conditions.

Importantly, Vietnam’s social protection system must be modernised to help all citizens to manage economic and natural disaster risks and sustain living standards even during difficult times. The experience of the pandemic demonstrated that gaps have opened in national social protection and social assistance programmes. The digitalisation of social assistance registration and delivery and basing these systems on universal citizenship rather than local residence will enable them to respond more equitably and quickly during times of heightened risk.