Welcome to the 2018 IMF/World Bank Group Annual Meetings. It’s an honor to be here.
I’d like to start by thanking the government of Indonesia for their commitment to host these important meetings in the wake of the terrible tsunami and earthquake in Sulawesi. I’d like to express my sincere condolences to the family, friends, and loved ones of those who were lost – and we are also learning of further loss of life from last night’s event. We’re working closely with the government, and we have offered our immediate and strong support – at the Government’s request – should it be required.
Indonesia has enjoyed strong economic growth and is making significant advancements in its efforts to end extreme poverty.
Indonesia's GDP per capita has risen from 785 dollars in 2000 to more than 3,800 dollars in 2017. And the poverty rate here has been cut nearly in half – from 19.1 percent in 2000 to 9.8 percent today. This is impressive progress, and we’re confident the country can continue this economic trajectory in the wake of the recent tragedy.
By hosting these meetings, Indonesia is once again showing the world that it is a strong, resilient, and determined country. And this gathering is a clear demonstration that the international community stands with the people of Indonesia in this difficult time.
These Annual Meetings focus on important issues facing the global economy. But too often we find ourselves focused on short-term issues: What is the impact of a rise in interest rates, a drop in commodity prices, or a shift in bond yields?
We’re focused this week on two long-term issues that are critical to every country – developed or developing; rich or poor.
The first is climate change.
Climate change is an existential threat to global development and efforts to end poverty. The warming planet is already having an impact on the poorest and most vulnerable.
The new report from the IPCC shows that our window to keeping warming to 1.5 degrees C is closing rapidly. That will affect every single living creature on the planet – today, and long into the future.
We have far less time than we thought – and far less urgency than we need.
The second issue that requires countries to take the long view is human capital – the knowledge, skills, and health that people accumulate over their lives.
We know that politicians in rich and poor countries alike face uphill struggles to fund better healthcare, put more money into schools, and make other investments in people that yield measurable dividends only over time.
We need a stronger argument. That’s why today we’re launching a new tool to help countries make those investments in their people: the first Human Capital Index.
Policies to build human capital are some of the smartest investments that countries can make to boost long-term, inclusive economic growth.
Right now, a quarter of the world’s young people are unlikely to achieve their full potential because of chronic malnutrition and illness that result in stunting, which permanently affects a child’s cognitive development, school performance, and future income.
If a country’s children grow up unable to meet the needs of the future workplace, that country will find itself incapable of employing its people, unable to increase its output, and utterly unprepared to compete economically.
This index gives policymakers compelling evidence that delivering better outcomes in children’s health and learning can significantly boost the incomes of their people – and shape the direction for their countries – far into the future.
If we act with a with fierce sense of urgency, we can create a world where all children arrive at school well-nourished and ready to learn; where they have a chance to grow up and become healthy, skilled adults; and where they can be productive throughout their careers as they reach for their own aspirations.
That’s the world we want. This index can help get us there.
I’m happy to take your questions.
Last updated: October 11, 2018 at 2:40pm Bali time.