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Masood Ahmed is president of the Center for Global Development. He joined the Center in January 2017, capping a 35-year career driving economic development policy initiatives relating to debt, aid effectiveness, trade, and global economic prospects at major international institutions including the IMF, World Bank, and DFID.
Ahmed joined CGD from the IMF, where he served for eight years as director, Middle East and Central Asia Department, earning praise from Managing Director Christine Lagarde as a "visionary leader." In that role, he oversaw the Fund's operations in 32 countries, and managed relationships with key national and regional policy makers and stakeholders. In previous years, he also served as the IMF's director of External Relations, and deputy director of the Policy Development and Review Department.
From 2003-2006, Ahmed served as director general, Policy and International at the UK government's Department for International Development (DFID). In that role, he was responsible for advising UK ministers on development issues and overseeing the UK's relationship with international development institutions such as the World Bank.
Ahmed also worked at the World Bank from 1979-2000 in various managerial and economist positions, rising to become Vice President, Poverty Reduction and Economic Management. In that role he led the HIPC (heavily indebted poor countries) debt relief initiative, which has to-date brought relief from debt burdens to 36 of the world's poorest nations.
Born and raised in Pakistan, Ahmed moved to London in 1971 to study at the LSE where he obtained a BSc Honors as well as an MSc Econ with distinction. He is a UK national.
Ahmed is a leading expert on Middle East economics, having served on the Advisory Board of the LSE Middle East Center, as well as on the World Economic Forum's Global Agenda Council on the Middle East and North Africa. He has also participated in CGD's Advisory Board.
He took over as CGD president from Nancy Birdsall, who served as the Center's founding president for its first 15 years from 2001 and will stay at the Center as a senior fellow.
What will you remember about 2017? The growing crisis of displacement? The US pulling out of the Paris agreement and reinstating the global gag rule on family planning? Or that other countries reaffirmed their commitment to the Paris agreement, that Canada launched a feminist international assistance policy, that Saudi Arabia finally let women drive?
CGD experts have offered analysis and ideas all year, but now it's time to look forward.
What's going to happen in the world of development in 2018? Will we finally understand how to deal equitably with refugees and migrants? Or how technological progress can work for developing countries? Or what the impact of year two of the Trump Administration will be?
Today’s podcast, our final episode of 2017, raises these questions and many more as a multitude of CGD scholars share their insights and hopes for the year ahead. You can preview their responses in the video below.
Thanks for listening. Join us again next year for more episodes of the CGD Podcast.
I was recently invited to participate in a panel discussion, titled “Artificial Intelligence and the Future of Human Labor” at the 10th edition of World Policy Conference. Preparing for this panel provided me with an opportunity to think more deeply about the ways in which artificial intelligence (AI) and automation will impact the future of work. And I came to five main conclusions.
Change is coming ready or not
Technological progress and the advancement of AI and automation will have a major impact on the nature of work in the coming decade. We are all familiar with the transport revolution where self-driving cars are now a question of “when” not “whether.” But we need to recognize that AI, robotics, 3D printing, and big data will change the nature of many different types of jobs in ways that we can already anticipate and in ways that we cannot even imagine today. And coping with this kind of widespread and rapid change—notwithstanding the gains it will bring—will raise difficult societal challenges that few countries are prepared to address.
The optimists, on the other hand, maintain that while many occupations could in theory be impacted, the actual pace of introducing new technologies into the work place will be more gradual, that in some cases robotic technology might turn out to be more expensive than traditional production methods. Thus, low paid garment workers in Bangladesh or Cambodia may simply be pressured to keep working at low wages if they want to avoid losing their jobs to robots. They also point out that it is “activities” that can be automated not “occupations.” This is certainly true but it still means that many occupations will be transformed because the activities that comprise them will be eliminated or radically changed. Finally, they point out that historically societies have been able to adapt to—and gain from—various waves of technological change and this time will prove no different. Unquestionably, the quality of life today for the vast majority of human beings is better than for our predecessors of a hundred years ago because of technology. And all along, there were people whose worries about the disruptive impact of technology proved exaggerated.
I believe that—as (almost) always—the likely outcome will be somewhere in between but the more important point is that even a slower pace of introduction of new technologies will still far outstrip the capacity of many societies to absorb the change. No one is seriously arguing that the pace of digital technological innovation over the coming twenty years will be slower than in the past two decades and it is now widely accepted that the way in which we have managed the political and social consequences of technological change in this recent past has been far from satisfactory. Therefore, it is important not to argue about the potential magnitude of the impact and instead to anticipate possible challenges that technology will create for human workers and ways in which the development community can help mitigate negative outcomes.
And not just in advanced economies
Discussions surrounding AI, automation, and the future of work tend to focus on the ways in which technological progress is affecting advanced economies. It is important to recognize, however, that the impact of new technology will be equally important for workers in developing countries. For example, Adidas employs about a million people, mostly in factories in Asia and Africa, to make about 300 million pairs of shoes every year. Last year they opened a “speed-factory” in Germany, that aims to make 500,000 pairs of shoes a year, with only 160 production jobs for human workers. The remaining jobs within the factory are automated and done by machines. Another example: FoxConn (the firm that produces Apple and Samsung products in China’s Jiangsu province) recently replaced 60,000 Chinese factory workers with industrial robots. In China as a whole, factories are projected to have more than 400,000 industrial robots installed by 2018, the highest number of any country in the world. And the jobs that will be impacted range far beyond manufacturing—many activities in agriculture, in services, and in government could be radically changed through the application of new technologies.
Policy discussions about the ways in which governments can be prepared for the radical changes in human labor that are coming must, therefore, include ways to limit negative impacts in developing countries. This includes rethinking the basic model of development pathways whereby surplus labor shed from agriculture is absorbed in simple manufacturing which raises both living standards and productivity. Technological progress that displaces workers could diminish the cost competitiveness of emerging economies that has, until now, driven their growth especially if these economies do not use new technologies to increase productivity. As manufacturing becomes increasingly automated, emerging economies will need to find strategies to decrease their dependence on manufacturing exports to boost growth. These strategies will obviously vary by country due to differences in resources, policies, and infrastructure capabilities.
New technology requires new skills
Historically we have seen that after a technological revolution, new and better jobs are created after the initial displacement of workers but that these workers need new skills to adapt to these new jobs. The need for new skills is even more critical today because of the pace and breadth of technological change. However, while many agree that our current education system is not teaching our children the skills they will need, we are not as confident about what precise skills tomorrow’s workers will need or how best to ensure that they acquire them. Continual skills training and life-long learning could help workers gain necessary skills to keep up with the changes in activities required within a job due to automation and AI. Education efforts could also help some workers shift from easily automatable jobs into less automatable jobs such as those in healthcare or childcare. However, the vast majority of workers in developing countries have no more than a high school education and it is not evident that they could be easily retrained for the skill set needed for the new economy. Nor is it clear how governments would pay for this retraining or incentivize companies to bear the costs of retraining.
Beyond jobs to relationships
AI and disruptive technologies will impact not just the nature of work but also the relationship that workers have with their employers, with colleagues, and with the state. Legal systems are already grappling with the question of whether an Uber driver is a “worker” in the traditional sense. A larger question is how to provide security of work and income to the potentially large share of the workforce that will work in the gig economy. One idea is to adopt a universal basic income (UBI) to insulate workers, whose jobs were replaced or changed by disruptive technologies, from poverty. Additionally, a UBI could enhance the ability and security for workers looking for better jobs or entrepreneurial opportunities. And a universal basic income could spur innovation and encourage people to take entrepreneurial risks because of the safety it provides. However, there are basic issues of affordability and regressiveness that need to be addressed before this idea can be applied on any large scale. There are also issues of how healthcare, pensions, and professional skills development will need to be modified in a world with many more individual contractors. This is of course more complicated in developing countries where financial resources are limited and institutional capacity is underdeveloped.
Don’t underestimate the politics
Finally, we need to recognize that this new era of technological revolution will be political as much as economic. With the rise of automation there will be winners and losers and redistribution will be necessary to compensate the losers and a failure to do so can have enormous political consequences. In the United States and Europe, a failure to adequately compensate the losers of globalization and technological change has helped lead to a rise of populism which is changing the political landscape.
Change is here. While we may not know how large this change will be or what the effects this technological revolution will have on human labor in five, ten, or twenty years, it is highly likely that the scope and magnitude of change will require considerable societal adaptation and that this process will need extensive preparation and discussion. We need to start thinking now about different development approaches that can help mitigate the negative impacts of the technological revolution in both advanced and developing countries.
Every day, the Center for Global Development breaks through the noise, fake news, and political soundbites with independent research, data, and evidence to improve the lives of millions of families around the world. With new challenges in every corner of the globe, now, more than ever, we need to make sure global development is done smartly and sustainably.
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On December 7th, academics, private sector representatives, and policymakers turn to an issue that affects women in rich and poor countries alike: the ability to make informed, voluntary, and autonomous choices about childbearing, and the implications of reproductive choice as a lever to expand women’s economic and life prospects. Until recently, there has been a lack of rigorous empirical evidence on the links between contraceptive access and women’s economic empowerment in low- and middle-income countries. The 2017 Birdsall House Conference features new findings on this relationship alongside existing evidence from the United States.
The IMF Fiscal Affairs Department is launching a new book entitled Digital Revolutions in Public Finance. The event’s panel discussion will center around fundamental questions raised in the book, which makes the case that by transforming how we collect, process, and act on information, it can expand and reshape the way we operate within the frontiers of policymaking, allowing us to do what we do now, but better—and perhaps before too long, even design fiscal policy in new ways. The book also explores the institutional challenges and capacity constraints faced by countries seeking to benefit from the digital revolution, as well as privacy and cybersecurity concerns, which call for greater international cooperation and regulation as information increasingly travels across borders.
What are the challenges and opportunities for growth in the Middle East, North Africa, Afghanistan and Pakistan (MENAP) region? In his presentation, Jihad Azour will present the IMF’s latest economic outlook for the MENAP region. He will argue that growth has not been fast enough and has not created sufficient opportunities to address high levels of unemployment. The presentation will be followed by a panel discussion on the main impediments to growth and highlight the policy priorities to durably increase it and make it more inclusive.
The Birdsall House Conference Series on Women seeks to identify and bring attention to leading research and scholarly findings on women’s empowerment in the fields of development economics, behavioral economics, and political economy. On December 7th, academics, private sector representatives, and policymakers will turn to an issue that affects women in rich and poor countries alike: the ability to make informed, voluntary, and autonomous choices about childbearing, and the implications of reproductive choice as a lever to expand women’s economic and life prospects. Until recently, there has been a lack of rigorous empirical evidence on the links between contraceptive access and women’s economic empowerment in low- and middle-income countries. The 2017 Birdsall House Conference will feature new findings on this relationship alongside existing evidence from the United States.
The IMF Fiscal Affairs Department is launching a new book entitled Digital Revolutions in Public Finance. Offering the first detailed assessment of the impact of digital technology on fiscal policy, this publication is a landmark of a collaboration between the IMF’s Fiscal Affairs Department and the Bill & Melinda Gates Foundation. It includes contributions from academics, former government officials and technologists, providing perspectives on how digitalization can revolutionize the design and implementation of fiscal policy—and on the risks and challenges that need to be faced.
In the current political and economic climate, donor governments are under pressure to reduce and spend foreign aid budgets as efficiently and effectively as possible. Aid remains a critical driver of progress. Yet at the same time, aid is increasingly NOT how the world pays for development; even the annual total of around $160 billion in overseas development assistance (ODA) represents a small and declining share of all global development finance. Private investment flows and developing countries' own public resources dwarf ODA. And while organizations like the World Bank and the UN still have top billing, commitment to their core missions appears to be weakening and regional alternatives are on the rise. Given these considerations, what is the future of development finance?
An increasingly common justification for European development assistance to Africa is the notion that it will reduce migration from the South. While this sounds intuitive and makes for an appealing argument, the research shows that it is highly unlikely. As communities become less poor, more people gain the abilities and wherewithal to undertake an expensive journey to a better life elsewhere. Development often increases migration—at least initially.
The combination of demographic and economic imbalances means that migration flows between Africa and Europe will almost certainly increase in the coming decades. By 2050, sub-Saharan Africa will have 800 million new workforce participants. This population boom will be full of young, energetic job seekers, and local markets will not be able to absorb and provide meaningful livelihood opportunities for all of them. At the same time, Europe will continue aging, with labor demand exceeding supply in critical sectors such as nursing and healthcare. By 2050, more than 34 percent of Europe’s population is expected to be age 60 or older.
Alongside these demographic realities is the continuing imbalance in living standards. Even if African average per capita incomes were to double in each of the next three decades, by 2050 the income gap with Europe will still be large enough to make migration a promising alternative for many. In addition to economics, many migrants will be driven by conflict or by the already-evident impact of climate change on their home countries. The bottom line is that over the next three decades, it is highly likely that tens of millions of new workers will come to Europe to run factories, provide healthcare and education, and deliver the services that make modern economies functional and comfortable for their residents. The policy choice for Europe is not whether there will be large scale migration, but how to manage it in a way that is economically beneficial and socially sustainable. Three policy imperatives flow from these realities.
Implement policies that maximize migration’s mutual benefits.
Migration can have immense mutual benefits if it is well-governed. Host country policies governing migrants’ access to labor markets and their ease of integration into local communities will determine how quickly these positive migration impacts can be realized. There are many good ideas—and examples—that can be scaled up. Australia and Germany have successfully tested programs to train migrants in needed skills before they arrive, part of a model that CGD has proposed called Global Skill Partnerships. Engaging the private sector from the start is critical to ensuring that such models are sustainable, meet local needs, and maximize migrant contributions to economies. Germany and Canada can provide valuable lessons on supporting the integration of migrants into host communities.
Making migration work also requires explicitly and proactively addressing the needs of host communities. When governments fail to step up help for schools and health facilities strained by additional demands, it only aggravates tensions and resentment that can spill over in ugly ways. Migrants almost always generate net positive economic benefits to the host country at large, but these benefits need to flow quickly and visibly to the local communities most directly impacted by migration. Ultimately, the effect of migration is a policy decision, and policymakers need to implement legislation that allows robust migrant contributions to be realized, at the community level and beyond.
Support Africa’s development for the right reasons.
A vibrant, safe, and prosperous Africa is not just important to Europe but also to the world. And many countries in Africa are making admirable progress on economic and social development. At the same time, the continent poses the central development challenge for the next generation—eradicating remaining extreme poverty; improving health and education outcomes; providing economic opportunities for the burgeoning young population; and dealing with conflicts, extremism, and failing states. Tackling these challenges will require leadership from the continent and sustained support from its partners. For Europe, increasing support to economic and other development in Africa is imperative, not only as a neighbor, but also to equip Africa’s future workforce with the skills and education that will maximize their contributions at home and in Europe, should they choose to move.
That is why development engagement with Africa—through aid but equally through trade, investment, and other channels—remains an essential priority for European policymakers. But for this development assistance to be effective, it needs to focus on supporting broad-based development and not be distorted by ultimately futile programs linked to deterring migration. There is some evidence that funding projects targeted to the supposed root causes of migration and tailoring development interventions too closely to those migration drivers may instead undermine development (and migration deterrence) “by neglecting the development needs of communities.” Given demographic realities, large-scale migration will not significantly let up in the coming decades. In some circumstances, humanitarian or development assistance can relieve immediate pressures to leave a distressed environment, but deterrence efforts alone will not counter the multitude of factors driving these migrant flows. Too narrow a focus on deterrence mechanisms also stacks the test of success for development assistance in a way that will come back to haunt us when we inevitably fail to meet it. Instead, states and international organizations must focus on partnerships and cooperation to shape how migrants will move and contribute.
Address the political discourse head-on and change the rhetoric around migration and development.
The politics around migration are as hard in Europe as they are everywhere. Dealing with the recent and rapid flows of refugees and migrants has brought out underlying tensions within societies and divisions among European states. In this climate, it is expedient to focus on short-term goals rather than provoke a contentious debate about longer-term strategic choices. Expediency, however, can also become an excuse to postpone the necessary dialogue to prepare European societies for the choices they face and how best to manage them. The future migration challenge Europe faces is an example of a so-called Gray Rhino—a highly probable, high-impact, yet neglected policy challenge. To neglect it may likely mean welcoming a cycle of migration “crises” reaching Europe’s borders for decades to come.
The responsibility for changing the discourse falls on more than political or public figures. In the development community, we also sometimes fall into the trap of referring to migration as a “problem” rather than acknowledging it as a potential opportunity. With the right policies, migration offers huge improvements in human welfare, with significant contributions to host communities, migrants’ home communities, and migrants and their families. Let’s work together to put those policies in place so Europe and Africa will both be better for our children.
As she prepares to step down after eight years as UNDP Administrator and head of the UN Development Group, Helen Clark joins CGD President Masood Ahmed to reflect on recent gains and consider both new and longstanding challenges facing development agencies and the United Nations in particular in the years ahead.
As part of the G7 meetings, Minister Marie-Claude Bibeau will host a meeting of G7 Development Ministers – the first of its kind since 2010. In preparation for that meeting, Minister Bibeau will join the Center for Global Development to discuss the priorities for this global development summit. In particular, she will discuss the importance of advancing the empowerment of adolescent girls including their central role in eradicating poverty and the need to move towards gender-responsive approaches to humanitarian assistance.
Corruption can siphon desperately needed resources away from development, but as some anti-corruption advocates have found, taking on vested interests can come at a great personal risk to their livelihoods—or even their lives. Ngozi Okonjo-Iweala’s new book, Fighting Corruption Is Dangerous: The Story Behind the Headlines, draws on her years as Nigeria’s Finance Minister to provide practical lessons on the difficult, sometimes-dangerous, always-necessary work of fighting graft and corruption.
“Our stock in trade is to bring to bear evidence on what works and what doesn’t,” says Masood Ahmed, CGD’s new president. He is paying tribute to a successful CGD tradition of nonpartisan, research-based policy innovation, as well as underlining what will continue to be our model in the future.
“The history of supporting development is a history of learning,” he tells me in his first CGD podcast. “What the World Bank, DFID, USAID, and other institutions do today is different from what they were doing 15 years ago and to my mind that is fantastic, because it shows these institutions have been learning from experience.”
We also talk about how facts and evidence sometimes seem under assault these days, as does the very idea of investing in development:
Over his 35-year, pre-CGD career in international financial institutions and development agencies, including the IMF, the World Bank, and DFID, Ahmed says the “broad shared consensus” around development has eroded, partly because “we have not made enough of an effort to convey a narrative about what it is that globalization and engagement with the rest of the world means for countries themselves [and] how we benefit from it.”
But how we communicate development progress is not the only issue. In the podcast, Ahmed also suggests that, in addition to the impact of technology and globalization, taxation and other policies of rich countries have also exacerbated inequality and a feeling of losing out—sentiments that have brought nationalism to the fore.
“We have to recognize that in advanced countries . . . many communities have felt that the pace of change has outstripped their capacity to adapt to change . . . . The measures we have taken to address the genuine concerns of these people have not been adequate.”
How do you make the case for US foreign aid to an Administration that has proposed slashing it? That was the task for Mark Suzman, Chief Strategy Officer and president of Global Policy and Advocacy for the Bill & Melinda Gates Foundation.
Suzman came to CGD in between accompanying Bill Gates to meetings at the White House. At an event called Financing the Future—which also included CGD’s president Masood Ahmed, senior fellow and chief operating officer Amanda Glassman, and former finance minister of Liberia (and now CGD distinguished visiting fellow) Antoinette Sayeh—Suzman gave us two very different versions of the fight against global poverty and disease.
Hear more of what Suzman and his fellow panelists had to say in this week’s podcast.
China's Belt and Road Initiative aims to connect countries that account for 60 percent of the world's people and 30 percent of global GDP. How can we make sure it produces real and lasting benefits for developing countries that are involved? At this special mini-summit, co-hosted by CGD, the European Bank for Reconstruction and Development, and the Reinventing Bretton Woods Committee, we will bring together global leaders, including governments, multilateral development finance institutions and private banks to identify and discuss practical considerations for BRI partners, as well as challenges and solutions.