Reports and Publications


ESCAP produces a number of publications each year examining the breadth and implications of economic and social policy making in the Asia and Pacific region. The Countries with Special Needs Development Report is the annual flagship publication. Other analytical products such as working papers, policy briefs and information materials are available to download.


Asia-Pacific Countries with Special Needs Development Report 2020: Leveraging Ocean Resources for Sustainable Development of Small Island Developing States

thumbnail_pic The Asia-Pacific Countries with Special Needs Development Report examines how small island developing States can leverage ocean resources for their sustainable development. It shows that these economies are not on track to reach most of the Sustainable Development Goals and that accelerated action is needed to reach them, especially given that the economic and social impacts of the COVID-19 pandemic will be hard felt by the people in the Asia-Pacific region. It examines how small island developing States should take full advantage of their blue economy to foster their development, focusing on two sectors, fisheries and tourism, which are important in small island developing States and which both rely on ocean resources. This report puts forward pertinent policy recommendations to strengthen the development role of fisheries and tourism. It highlights that scaling up action for oceans is required for small island developing States to make progress towards implementing the 2030 Agenda for Sustainable Development. Enforcing international frameworks, norms and standards is one element that will contribute to such progress; ensuring greater regional cooperation is another one. Just as the policy response to the current COVID-19 pandemic underscores the importance of coordinated and evidence-based policy measures, grounded in strong political will and commitment to sustainability, regional cooperation can help protect fisheries and enable recovery of coastal fisheries. It can also be linked to tourism by promoting a common branding for the Pacific subregion and leveraging tourism to foster further sustainable development.

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Addressing the impact of the pandemic on tourism in Asia-Pacific small island developing States

thumbnail_pic The collapse of tourism resulting from the COVID-19 pandemic will have a profound impact on the Asia-Pacific small island developing States because of their high reliance on tourism rents. The pandemic will disproportionally influence the lives and well-being of the poorest and the most vulnerable, including workers in the informal sector. Addressing this challenge requires both broad mitigation measures to counteract the consequences of the outbreak as well as specific policies to support local tourism-related businesses and affected communities. For Governments that do not have the fiscal space, adequate concessional assistance from the international community will be critical. At the same time, however, long-term efforts for the sustainable development of the tourism sector should not be undermined, particularly by taking full advantage of their blue economy potential – a concept depicting sustainable use of vast oceanic resources – to foster their development.

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Graduation of Bhutan from the group of least developed countries: Potential implication and policy imperatives

thumbnail_pic Despite confronted with such unfavourable conditions as mountainous topography and being landlocked and susceptible to natural disasters, Bhutan has demonstrated a strong track record in sustaining economic growth and reducing poverty over the past two decades or so. Its progress in other socio-economic indicators as reflected in its success in achieving many of the 2000-15 Millennium Development Goal (MDG) targets is also worth noting. It is unique in approaching development by valuing collective happiness as the goal of governance. Bhutan successfully met the least development countries (LDCs) graduation criteria in two United Nations triennial reviews of 2015 and 2018 and is set to graduate from the group of LDCs in 2023. The transition involves loss of certain trade preferences and other international support measures. However, as the significance of these benefits has been quite limited for Bhutan, LDC graduation should not be a major cause for concern. While most LDC-specific privileges are related to international trade, Bhutan’s overwhelming dependence on trade with India is governed through a bilateral trade agreement insulted from LDC status. Overseas development assistance is important for Bhutan although its significance in the economy has fallen. Graduation should not have much implication for development financing as development partners do not use LDC status as an important factor in deciding about aid allocation. For Bhutan, dealing with general development challenges should remain important policy priorities. It has embraced a proactive policy stance for graduation by combining its eighth five-year development plan, Sustainable Development Goals (SDGs) and Gross National Happiness (GNH) indicators. Bhutan has huge potential for developing supply-side capacities and generate employment opportunities through further development of such sectors as tourism, agribusiness, ICT and hydropower. Major impediments for exerting dynamism in these sectors include lack of investment, infrastructure deficit, and poor connectivity. Diversification of economic activities is a challenge for which one priority attention should be on developing the private sector.

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Policy responses to COVID-19: Addressing the impact of the pandemic on tourism in Asia-Pacific small island developing States

thumbnail_pic The collapse of tourism resulting from the COVID-19 pandemic will have a profound impact on the Asia-Pacific small island developing States because of their high reliance on tourism rents. The pandemic will disproportionally influence the lives and well-being of the poorest and the most vulnerable, including workers in the informal sector. Addressing this challenge requires both broad mitigation measures to counteract the consequences of the outbreak as well as specific policies to support local tourism-related businesses and affected communities. For Governments that do not have the fiscal space, adequate concessional assistance from the international community will be critical. At the same time, however, long-term efforts for the sustainable development of the tourism sector should not be undermined, particularly by taking full advantage of their blue economy potential – a concept depicting sustainable use of vast oceanic resources – to foster their development.

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A Review of Access to Finance by Micro, Small and Medium Enterprises and Digital Financial Services in Selected Asia-Pacific Least Developed Countries

thumbnail_pic Micro, Small and Medium Enterprises (MSMEs) are key to the economies of various countries. Their numbers and contribution towards employment is well documented and there is acceptance amongst policy makers that these enterprises are critical for economic development. Increasingly, access to finance has been recognised as a major hurdle in their development or growth. Amongst, the countries reviewed in this paper - Bangladesh, Bhutan, Cambodia, Lao People’s Democratic Republic, and Nepal – Bhutan is the only target country where the supply of finance to MSMEs is favourable with nearly 68% of the demand being met. Cambodia has the highest finance gap followed closely by Lao Peoples Democratic Republic and Nepal. While examining the finance gap of microenterprises and SMEs, the gap revealed in Bhutan, Cambodia, Lao People’s Democratic Republic and Nepal are not substantial. However, in Bangladesh the differences are much larger between microenterprises and SMEs with only 14% of microenterprise demand being met. The review also explores the number of women owned MSMEs (WMSMEs) in the countries and the access to finance for such enterprises. It shows that the finance gap is amongst the lowest in Bangladesh (6%), Bhutan (19%) and Nepal (9%). In Cambodia and Lao People’s Democratic Republic, the share is higher at 32% and 42% respectively. But in both South East Asian countries women owned MSMEs also are a larger proportion of MSMEs. There are a number of demand and supply reasons or constraining factors leading to issues in access to finance. The common factors pertain to awareness, risk, knowledge, and products and processes. Women owned enterprises too face these challenges, but these may be more severe as they are often entrenched in gender stereotypes, limited education opportunities and restricted mobility, perception that women cannot manage businesses or lack leadership skills, and women are also often required to perform the dual role of business women and homemakers. Most of the countries are still in the process of framing laws pertaining to contract enforcement and resolution of insolvency. Specifically, on the demand side, enterpreneurship is not viewed as a career option and risk acceptance is overall low. While these constraints exist, there are several policy initiatives undertaken by regulators and governments in these countries to increase access to finance. These approaches involve a mix of regulatory and financial approaches, including efforts to develop the financial infrastructure, such as, secured transaction laws, creation of collateral registries, developing credit bureaus, and payment and settlement systems. Other actions include interest subsidies, dedicated funds and institutions. But these are in various stages of enactment and implementation. Cultural shifts in terms of acceptance of entrepreneurship have also been observed in many of these countries, with governments adopting policies to encourage entrepreneurship. While Digital Finance Services (DFS) initiatives specifically linked to increasing MSME access to finance are few, and there are no specific policy initiatives (in the target countries) linking the two, development of DFS and its spread is likely to positively affect MSME access to finance. This is because DFS helps to create a digital footprint that when combined with other accumulated data can yield business intelligence to make decisions related to credit risks, for example. In all the countries reviewed, there is a notable push in terms of policy and mobile connectivity that favour the growth of digital payments. Number of bank and non-bank agents in all the five countries has shown significant increase as has the adoption of payment services by populations. This has in part been supported by the high levels of 2G and 3G mobile service penetration. A lot of the policy and regulatory effort by the target countries is in the right direction which requires further encouragement and a more nuanced approach towards MSMEs. Policy makers need to continue to build their own capacity on MSME access to finance. In terms of financial infrastructure, what matters is that it is effective and reliable. This should be the continued focus of policy makers and regulators in the target countries. Alternative source of finance should be encouraged, but with the understanding of the varied sources and their applicability to different stages of enterprises. It is vital that women owned MSMEs be treated as a distinct category and attempts made to use data and training to remedy the perception issues. Finally, DFS offers immense potential and efforts need to be made move beyond payments and into digital lending, savings and insurance simultaneously building up consumer protection policies related exclusively to DFS.

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Asia-Pacific Small Island Developing States: Development challenges and policy solutions

thumbnail_pic Asia-Pacific small island developing States (SIDS), are a diverse group, despite the broad perception to the contrary. Nevertheless, although they differ in size of landmass, population, national economies and the level of development, they share common development challenges. Those challenges can be classified as economic (small sized, undiversified economies, remotely located and exposed to external shocks), environmental (existential threats related to climate change and environmental degradation), political (ethnic conflicts and political instability) and social (violence towards vulnerable groups). Some of the challenges – such as environmental and economic vulnerabilities – cannot be addressed without concerted efforts and the support of the international community. This support is framed within the United Nations’ programmes of action, and more specifically, the SAMOA Pathway for SIDS (2014-2024) and the Istanbul Programme of Action for Least Developed Countries (LDCs) (2011-2021). The solution to the development predicaments of SIDS also lies in a particular type of structural economic transformation, which does not follow the traditional path from agriculture to industry and then to services. As building a manufacturing base in remote islands located far away from global markets is not a viable option, structural transformation in SIDS must be well targeted and aimed at productive, niche services and modernised agriculture and fishery, and at utilising the resources of their exclusive economic zones. This sectoral development of both sectors, if accompanied by productivity gains, will effectively enhance the development trajectory. Subsequently, these actions must be underpinned by economic policies to build economic resilience, create productive capacities and productive employment, and to utilise new mechanisms to finance developmental advancements.

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Nepal's graduation from LDC: Potential implications and issues for consideration

thumbnail_pic Nepal has achieved significant socio-economic progress despite being confronted by unfavourable conditions such as its being landlocked and susceptible to natural disasters. It has demonstrated a paradoxical development pattern in which a relatively low long-term average economic growth has been accompanied by brisk poverty reduction. The country met criteria for graduation from the group of least developed countries (LDCs) in two consecutive United Nations triennial reviews in 2015 and 2018. With a per capita income of just 60 per cent of the graduation threshold level of per capita income, it was quite extraordinary for Nepal to meet the other two graduation criteria, the Human Asset Index and the Economic Vulnerability Index. It provides a classic case in which a country’s achieving LDC graduation thresholds do not adequately reflect its challenges of achieving sustainable development through building productive capacities as envisaged in the Istanbul Programme of Actions (IPoA) for LDCs. Most concrete LDC-specific international support measures (ISMs) are related to international trade from which Nepal has not been able to benefit much. While the IPoA and 2030 Sustainable Development Agenda anticipated LDC trade share to double by 2020, in reality, it has declined with Nepal’s merchandise exports falling in both absolute and relative terms. The 2018 United Nations Committee for Development Policy (CDP) decision to defer the recommendation of graduation until the next review was a judicious one and further deferments could also be considered as part of ISMs in helping Nepal consolidate its socio-economic achievements and securing Sustainable Development Goals. For Nepal, dealing with general development challenges, promoting external competitiveness, trade capacity building, and exploring enhanced trading opportunities in neighbouring and regional partner countries, amongst others, should remain important policy priorities.

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