Asia and the Pacific’s Developing Countries Need a Mission to Move Forward

Mission driven policy making requires a holistic approach.
Mission driven policy making requires a holistic approach.

By Susann Roth, Rainer Kattel

As the region recovers from the pandemic there is an opportunity to rethink how development is undertaken and to deploy mission-oriented approaches to policy making.

The COVID-19 pandemic caused the worst global recession since World War II. Developing countries are planning for economic recovery and they also need to tackle the increasing risks from climate change-related extreme weather events, as well as the erosion of public trust in government capabilities to address them.

The impact of the pandemic questions the resilience of existing government systems, how development policies are designed, and how innovations for the benefit of societies can be scaled.  It is becoming increasingly clear that traditional mechanisms for sustainable economic development are not enough.

There is no single solution to these challenges, but “mission-driven” policymaking can help. Traditional policy-making focuses on the identification of problems and solutions that are defined by a small group of politicians and experts. Often, the impact of these policies on future generations or on other aspects of societal development are not sufficiently considered. 

For mission-driven policy making, governments aim to address the lack of holistic strategic orientation and policy coordination and fragmented policy mixes. 

For mission-driven policy making, governments aim to address the lack of holistic strategic orientation and policy coordination and fragmented policy mixes.

Here are three ways that mission-driven policy making can move forward:

1. Develop a common vision and mission for economic development. Key challenges often include the lack of common and aligned short and long-term visions and missions. For example, a country might plan to base its economic recovery on the exploitation of its natural resources, invest in mining, in industrial-energy-intense processing and large-scale infrastructure development, while committing to the climate agenda.

To implement such a natural resource-intense and industry-driven economic recovery plan in line with a low carbon growth path requires rethinking how such efforts can be sustainable. It requires sustainable mining practices, sustainable building materials, reuse, reduce, and recycle approaches to construction and for the processing of natural resources for more circularity.

It also requires training of workers and to send signals to the private sector that business-as-usual is not an option and that new technologies and business models are required. It requires new procurement policies, tax incentives, central bank facilitated financial products via local banks that support green technologies and education curricula which develop talent that can identify and deploy relevant innovations. While one can say that all these efforts exist, the fact is that they are too fragmented, too little, and too slow.

2. Align stakeholder interests and provide incentives for technology transfer. This is where mission-driven policy making comes in. For example, the mission could be to “end carbon-intense infrastructure and industry development”. It gives all stakeholders clear direction and forces government to shape a shared playing field for collaboration towards a common goal, particularly so in the realm of research and innovation policies.

This forces stakeholders to rethink the capacities and role of government within the economy and society as a shaper and not fixer of societal issues. It focuses on results, decentralizes authority, reduces bureaucracy, and promotes competition inside and outside of government. This approach is not new; a good example is the moon landing, which forged collaboration and innovation across public and private sectors.  Examples from the past of such mission-driven economic development efforts include the large-scale wind energy turbine industry in Germany, memory chip production in the Republic of Korea, and E-residency in Estonia.

 A recent study commissioned by the European Commission lists 137 ongoing mission-oriented research and innovation initiatives in 32 countries. OECD provides an online explorable dashboard of examples of mission-oriented policies.

For instance, the Government of Sweden developed a mission to provide healthy and sustainable school lunches in all public schools. The policymakers used sustainable public procurement practices to issue tenders that included defined criteria of what healthy and sustainable means. This gave the private sector signals and nudged them into rethinking their supply chains. The mission led to innovations in the food industry and to localizing the supply chain which had impacts on local jobs and carbon footprints and ultimately it improved the quality of school lunches

3. Use sustainable public procurement and existing resource envelopes. Successful emerging economies of the last half century have been extremely good at focusing their economic policies on one overarching target, namely catching up with frontier technologies through structural change policies. All governments are already spending resources, it is a matter of asking whether these resources are helping tackle the main developmental challenges. To achieve that,  deploying sustainable procurement practices is a key tool that can be linked to government’s long-term decarbonization strategies.

Governments procure products and services, regulate financial and other industries, and provide public services. These are all resources being deployed. Domestic resource mobilization is key to successful developmental push and the question is again, how smartly these resources are being invested and utilized.

Research by UNIDO has shown that structural change through industrialization – building domestic capacities to produce goods and services and enabling continuous upstreaming of skills and capabilities – is the key to attaining Sustainable Development Goals in emerging economies.

In this context, missions can offer a key governance tool to mobilize domestic actors and resources, focusing efforts on both building up production capabilities with fundamental societal challenges in mind. A report by Inter-American Development Bank shows how there are already several such initiatives in Latin American countries, from greening mining industries and tackling obesity.

As we emerge from the pandemic, there is a window of opportunity in Asia and the Pacific to deploy mission-oriented approaches to policy making and refocus on domestic challenges and capacities.

This blog relates to discussions among development practitioners and policymakers at ADB’s 55th Annual Meeting.