Beyond GDP: Measuring the Wealth of Nations for Green, Inclusive, and Resilient Growth

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00:01 How do you measure the wealth of a country?

00:04 For many,

00:04 gross domestic product is the first and

00:07 perhaps only measurement that comes to mind.

00:10 GDP measures the monetary value of the goods and services a country produces,

00:16 but it doesn't provide information on a country's wealth,

00:19 or how sustainable development will be in the long-term.

00:23 To do that,

00:24 we need to consider all of our country's assets,

00:26 the ones used to produce those goods and services in the first place.

00:31 So what assets ought to be considered?

00:34 Let's explore some of them.

00:36 First,

00:37 the natural capital,

00:38 like forests,

00:40 agricultural lands,

00:41 fisheries,

00:42 and minerals,

00:44 also the human made or produced capital,

00:47 buildings,

00:48 roads,

00:49 machinery and such.

00:50 And of course,

00:51 the skills and experience of the population,

00:55 a country's human capital.

00:58 Taking stock of a country's assets can help

01:00 determine whether or not growth is sustainable.

01:03 Exploiting natural resources may look like economic growth today,

01:07 but what about the future?

01:10 Forest degradation,

01:11 air pollution,

01:12 overfishing,

01:13 and more

01:13 deplete wealth and threaten future prosperity.

01:17 Over-dependence on certain non-renewable resources,

01:20 especially fossil fuels,

01:22 also poses risks.

01:25 Steps to increase future prosperity are possible,

01:27 however,

01:29 Protecting and investing in renewable natural capital is imperative,

01:33 particularly in the face of climate change.

01:36 For example,

01:38 consider how storms are increasing in frequency and intensity,

01:41 all while coastlines are further developed.

01:44 What can be done to protect these coastal assets?

01:48 One innovative approach,

01:49 replant mangroves,

01:51 a renewable natural resource.

01:53 Mangroves are becoming even more valuable because

01:55 of the protection they offer coastlines.

01:58 Investments in replanting and protecting mangroves,

02:01 especially where they are protecting other assets,

02:04 can safeguard future wealth.

02:06 Natural and produced capital aren't the only types

02:09 of resources in need of protection though.

02:11 Did you know that in most countries,

02:13 human capital represents the greatest fraction of wealth?

02:17 The global COVID-19 pandemic shows just how at

02:20 risk human capital and livelihoods can be,

02:22 and reinforced the need to address ongoing issues like gender gaps

02:26 and the health impacts of air pollution.

02:29 The World Bank's Changing Wealth of Nations 2021

02:33 provides the most comprehensive data to date

02:36 with full accounts of wealth for 146 countries.

02:40 Through wealth accounting,

02:42 decision makers can promote future economic viability and growth

02:46 with policies that promote sustainable use

02:48 and diversification of assets.

02:51 Look ahead to the future

02:53 with an eye on climate change and other risks,

02:56 and continually invest in a nation's greatest resource,

03:00 its people.

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How do you measure the wealth of a country? For many, gross domestic product is the first and perhaps only measurement that comes to mind. GDP measures the monetary value of the goods and services a country produces, but it doesn't provide information on a country's wealth, or how sustainable development will be in the long-term. To do that, we need to consider all of our country's assets, the ones used to produce those goods and services in the first place. So what assets ought to be considered? Let's explore some of them. First, the natural capital, like forests, agricultural lands, fisheries, and minerals, also the human made or produced capital, buildings, roads, machinery and such. And of course, the skills and experience of the population, a country's human capital. Taking stock of a country's assets can help determine whether or not growth is sustainable. Exploiting natural resources may look like economic growth today, but what about the future? Forest degradation, air pollution, overfishing, and more deplete wealth and threaten future prosperity. Over-dependence on certain non-renewable resources, especially fossil fuels, also poses risks. Steps to increase future prosperity are possible, however, Protecting and investing in renewable natural capital is imperative, particularly in the face of climate change. For example, consider how storms are increasing in frequency and intensity, all while coastlines are further developed. What can be done to protect these coastal assets? One innovative approach, replant mangroves, a renewable natural resource. Mangroves are becoming even more valuable because of the protection they offer coastlines. Investments in replanting and protecting mangroves, especially where they are protecting other assets, can safeguard future wealth. Natural and produced capital aren't the only types of resources in need of protection though. Did you know that in most countries, human capital represents the greatest fraction of wealth? The global COVID-19 pandemic shows just how at risk human capital and livelihoods can be, and reinforced the need to address ongoing issues like gender gaps and the health impacts of air pollution. The World Bank's Changing Wealth of Nations 2021 provides the most comprehensive data to date with full accounts of wealth for 146 countries. Through wealth accounting, decision makers can promote future economic viability and growth with policies that promote sustainable use and diversification of assets. Look ahead to the future with an eye on climate change and other risks, and continually invest in a nation's greatest resource, its people.

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Changing Wealth of Nations Final

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Changing Wealth of Nations Final

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