A fresh World Bank report, TIDES of Change: Igniting Productivity Growth in Europe and Central Asia, drops a big reality check. Countries in Europe and Central Asia, or ECA, would have economies 62% bigger today if they had kept up pre-2008 productivity. The global financial crisis did not hit capital or jobs as hard. Those kept chugging along. The real issue came from a massive drop in efficiency, which explains 91% of the slowdown.
After years of tough reforms in the 1990s and 2000s, momentum faded. Politics shifted, and people grew skeptical about who really benefited from opening markets. Governments leaned on easy wins like tax perks for investors instead of deeper fixes. Big state-owned companies and weak competition still hold things back, trapping talent and money in the wrong places.
Jobs have moved from factories to services, but too often into low-skill roles that do not boost the economy much. Top companies struggle to expand, while weak ones stick around too long. Trade also lags. ECA ships 45% less than it should, especially to rich markets.
The good news lies in global trade getting more regional. ECA sits right in the sweet spot between Western Europe and East Asia. To cash in, countries need to build up local businesses and roll out the red carpet for foreign investment.
The World Bank's TIDES plan lays out clear steps. Ramp up trade and investment. Push digitalisation and skills, especially in wealthier spots. Focus everywhere on efficiency, like trimming bloated state firms in poorer areas or tweaking rules in key sectors. Even a small 10% productivity bump could create two million jobs.
World Bank pro Leonardo Iacovone says efficiency wins across the board. Digital and skills growth suit the West. Trade and investment help Central Asia and the South Caucasus. This points to a clear call for smarter reforms to spark jobs, higher wages, and real catch-up growth.
DMX closely follows major reports from development banks such as the World Bank. Keep an eye on our website and LinkedIn page to stay up to date.
A fresh World Bank report, TIDES of Change: Igniting Productivity Growth in Europe and Central Asia, drops a big reality check. Countries in Europe and Central Asia, or ECA, would have economies 62% bigger today if they had kept up pre-2008 productivity. The global financial crisis did not hit capital or jobs as hard. Those kept chugging along. The real issue came from a massive drop in efficiency, which explains 91% of the slowdown.
After years of tough reforms in the 1990s and 2000s, momentum faded. Politics shifted, and people grew skeptical about who really benefited from opening markets. Governments leaned on easy wins like tax perks for investors instead of deeper fixes. Big state-owned companies and weak competition still hold things back, trapping talent and money in the wrong places.
Jobs have moved from factories to services, but too often into low-skill roles that do not boost the economy much. Top companies struggle to expand, while weak ones stick around too long. Trade also lags. ECA ships 45% less than it should, especially to rich markets.
The good news lies in global trade getting more regional. ECA sits right in the sweet spot between Western Europe and East Asia. To cash in, countries need to build up local businesses and roll out the red carpet for foreign investment.
The World Bank's TIDES plan lays out clear steps. Ramp up trade and investment. Push digitalisation and skills, especially in wealthier spots. Focus everywhere on efficiency, like trimming bloated state firms in poorer areas or tweaking rules in key sectors. Even a small 10% productivity bump could create two million jobs.
World Bank pro Leonardo Iacovone says efficiency wins across the board. Digital and skills growth suit the West. Trade and investment help Central Asia and the South Caucasus. This points to a clear call for smarter reforms to spark jobs, higher wages, and real catch-up growth.
DMX closely follows major reports from development banks such as the World Bank. Keep an eye on our website and LinkedIn page to stay up to date.
