Economy

... Even More Reasons to Feel Good About 2013


Much of the good news affecting the U.S. this year had a glass-half-full feeling: a slow climb out of recession but with stubbornly high unemployment; no default—only a shutdown; a health-care rollout to hundreds of thousands of uninsured Americans, but only after an atrocious opening month; a U.S.-China deal on greenhouse gases in a year when the concentration of carbon dioxide in the atmosphere passed 400 parts per million for the first time in human history.

There was, however, plenty of good news that didn’t come with a giant asterisk attached—and a lot of it involved continued progress in the developing world.

This year, IMF forecasts (PDF) suggested the developing world would account for more than half of global GDP for the first time in more than a century. In 2012, developing economies had accounted for 49.9 percent, and they continued to grow considerably faster than advanced economies throughout 2013. Over the longer term, that’s good news for the developed world: The faster poor countries grow, the more they import. The developing world now buys $8.7 trillion worth of global exports each year.

It used to be that the world was pulled out of recession by recovery in the U.S.—the growing strength of economies from Asia and Latin America may mean they’ll soon start repaying the favor. In fact, total U.S. exports in 2013 through September are up over $400 billion from the same period in 2009, thanks not least to strong export growth to Asia, Africa, and Latin America. To add some (admittedly ungenerous) icing to that cake: a WTO agreement signed in Bali last month that might make it marginally easier to get American goods through ports and customs procedures in the developing world.

On the subject of international transactions, there was also some global progress on financial regulation. The Group of Eight this year agreed to develop better mechanisms to share information on corporate tax payments across countries and data on who actually owns companies—so-called beneficial ownership. There’s a long way to go before the rules bite enough to ensure people with Cayman Islands bank accounts pay a higher portion of their income to the U.S. government than middle-class Americans do, but it’s a start.

At the other end of the global income scale, progress in reducing extreme poverty (defined as living on $1.25 a day or less) continued apace. Martin Ravallion of the World Bank predicted (PDF) this year that the proportion of the developing world living in extreme poverty would decline to 16 percent in 2015—down from 43 percent in 1990. That’s still a billion people living on less than one-tenth the U.S. poverty line, but progress has been dramatic enough that both U.S. President Obama and World Bank President Jim Kim chose this year to set the target of eradicating extreme poverty worldwide by 2030. The World Bank’s official slogan used to be “Our dream is a world free of poverty.” From now on, you can replace “dream” with “performance target.”

Meanwhile, we saw more encouraging evidence of the world’s progress in reducing child death. In 1990, around 12 million kids died before reaching the age of 5. That’s one every three seconds. Today, and despite population growth, we’re down to a child dying every six seconds. Once again, past progress encouraged global leaders to suggest we could end most child mortality by 2030. That’s in no small part thanks to the continued spread of vaccination, with 83 percent of kids worldwide fully immunized, up from 76 percent in 1990. 2013 saw the introduction of another new vaccine: a cheap, effective, single-dose shot against Japanese encephalitis, which causes brain inflammation, fever, headaches, coma, tremors, and—for 20,000 people every year—death.

Alongside new vaccines, the health of both children and adults in Africa improved due to progress in the global fight against HIV/AIDS. According to UNAIDS data, across 21 priority countries in Africa there were 130,000 fewer new HIV infections among children in 2012—a drop of 38 percent since 2009. That’s mostly due to increased drug treatment of pregnant women with the virus. In sub-Saharan Africa as a whole, new infections dropped from a peak of 2.7 million in the late 1990s to 1.6 million in 2012. And worldwide deaths from AIDS-related causes fell from 2.3 million in 2006 to 1.6 million in 2012. In part that’s because the cost of first-line treatment for AIDS fell from about $10,000 per person per year in the 1990s to $140 today.

One final piece of good news on global health: Coronavirus didn’t turn into the next global plague. A coronavirus was responsible for SARS—severe acute respiratory syndrome—which spooked global health officials and killed almost 1,000 people in 2002-3. In late 2012, a new mutation was discovered in Qatar and Saudi Arabia, dubbed Middle East Respiratory Syndrome. The World Health Organization declared an emergency, and warning posters went up in airports worldwide. But it turns out MERS spreads with difficulty between humans, and a relatively small number of 63 people have died from the condition.

The world’s global health bodies had some victories this year, alongside those engaged in facilitating trade and financial flows. That supported the continued progress in developing countries that are home to 6 billion out of the 7 billion people on the planet. That’s great news for the 1 billion people living in rich countries, too—it should make for a happier, healthier, and more prosperous 2014 for us all.

Kenny is a senior fellow at the Center for Global Development and author of The Upside of Down: Why the Rise of the Rest is Great for the West.

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