"IMPLEMENTING BUSINESS ENVIRONMENT REFORMS FOR ECONOMIC RECOVERY

Mongolia’s economic growth performance has been impressive though volatile in the last decade. Despite significant progress, Mongolia needs to strengthen the business enabling environment for a level-playing field and a more productive private sector beyond mining. The Government of Mongolia (GoM) has recognized the need for a more conducive investment climate and implemented several significant reforms. The recently adopted New Recovery Policy (NRP) aims to further address binding constraints to medium-term economic development. Even though the business environment is only one of the elements of a country’s competitiveness, it often “sets the tone” for an attractive investment climate. The quality of the business environment has also become a critical element of the competition between countries aiming to offer an attractive legal environment for investors.

"Addressing the climate crisis requires the net zero transition of millions of SMEs globally. SMEs have a significant aggregate environmental footprint and need to adopt cleaner business models. As eco-entrepreneurs and eco-innovators, they also have a key role to play in devising innovative climate solutions. Access to finance is essential for SME investments in net zero, but small businesses face considerable challenges in tapping into the growing pool of sustainable finance.

"Asia has experienced widespread transformation and growth, accompanied by increased demographic pressure, greater intensification of agricultural production, industrialization, and urbanization. This economic growth has been very resource- and carbon-intensive, while climate change has triggered or exacerbated behaviors and defense mechanisms that have come at the expense of the natural environment.

"A global pandemic, supply-chain disruption, extreme weather, war in Europe, forced migration on a massive scale, rocketing gas prices, high inflation, debt burdens, reshoring, friendshoring… It is clear that there will be no going back to the pre-pandemic “business as usual”. This year’s report examines the tectonic changes that the EBRD regions face and presents a wealth of analysis to inform public policy and business decision-making."

"Rural development is central to realizing the 2030 Sustainable Development Goals (SDGs) agenda because nearly 80 percent of the world’s poor live in rural areas (UNDESA 2021). Moreover, rural populations have less access to education, health, electricity, sanitation, and other services, leading to marked rural-urban disparities, discontent, and discord.

It is widely accepted that financial services for the poor and excluded is a key enabler in advancing several SDGs. However, increasing access to, and usage of, financial services in rural areas is not easy.

"Three compounding crises—conflict, COVID, and climate change—are giving rise to another: hunger.

Food prices rose 23 percent in 2021, ending several years of relative price stability, in part because extreme weather hurt harvests and energy costs climbed. Then came Russia’s invasion of Ukraine in late February, sending prices to an all-time high by disrupting commodity flows from two of the world’s largest exporters of wheat and other staples.

The invasion idled Ukraine’s once-busy Black Sea ports and left fields untended, while curbing Russia’s ability to export.

Nearly half a billion micro and small enterprises (MSEs) in emerging markets provide livelihood opportunities for millions of low-income populations around the world. Access to relevant, affordable, and responsible finance remains a persistent barrier, constraining stability and growth for these MSEs – especially the smallest firms and those in the informal sector. While the financial inclusion community has long focused on supporting MSEs, FSPs and funders tend to view the entire MSE sector as monolithic and do not consider the diversity of firms within that universe.

The region’s economy is expected to grow 4.3% this year, compared with ADB’s projection in April of a 5.2% expansion, while the growth forecast for next year is lowered to 4.9% from 5.3%. The downward revisions have been driven by increased monetary tightening by central banks, fallout from the protracted Russian invasion of Ukraine, and recurrent COVID-19 lockdowns in the People’s Republic of China.

The report covers the 49 regional members of ADB. It discusses trends in development progress and the challenges to achieving inclusive and sustainable economic growth across Asia and the Pacific.

"Money has transformed human society, enabling commerce and trade even between widely dispersed geographic locations. It allows the transfer of wealth and resources across space and over time. But for much of human history, it has also been the object of rapacity and depredation.

A new EBRD Working Paper (number 270)

The pandemic triggered a large, lasting shift to work from home (WFH). To study this shift, we survey full-time workers who finished primary school in 27 countries as of mid-2021 and early 2022. Our cross-country comparisons control for age, gender, education, and industry and treat the U.S. mean as the baseline. We find, first, that WFH averages 1.5 days per week in our sample, ranging widely across countries. Second, employers plan an average of 0.7WFH days per week after the pandemic, but workers want 1.7 days.

The world is paying a high price for Russia’s war of aggression against Ukraine. The high humanitarian cost continues to grow and the global economic outlook has darkened further.

This Interim Report focuses on the effects of the war on the world economy and the energy crisis. With the impacts of the COVID-19 pandemic still lingering, the war is dragging down growth more than anticipated.