The Global Roundtable of Chief Economists highlights global trends and best practices to help entrepreneurs thrive
Small and medium enterprises (SMEs) are critical for economic growth and employment around the world, but their impact is even greater in developing countries. In some regions, such as sub-Saharan Africa, creating a business is the only avenue to employment for millions of young people.
Considering the critical role of SMEs in growth, IDRC joined forces with the Business Development Bank of Canada (BDC) and the International Finance Corporation (IFC) to bring experts from around the world to Montreal, Canada, to learn and share best practices on September 21-22, 2017. IDRC sponsored the participation of economic experts from Argentina, Ethiopia, Mongolia, Sri Lanka, and Zambia to ensure that the experiences of southern development finance institutions enriched the discussion.
Co-hosted by Ted Chu, chief economist of IFC, World Bank Group, and Pierre Cléroux, BDC’s chief economist, the sixteen participants discussed a wide range of topics including key global and regional economic trends, the impact of development banks, and best research practices for promoting SME growth.
“The Global Roundtable for Chief Economists provided a unique environment for experts to engage with peers, learn from each other, and better promote SMEs in their respective countries. It brought together a diversity of influential economists with practical solutions and a wealth of experience to promote entrepreneurship and growth,” said David Schwartz, director of IDRC’s Donor Partnerships Division. “Seeing two Crown corporations such as IDRC and BDC collaborate on the first-ever Global Roundtable for Chief Economists is a great testimony of Canada’s continued commitment to advance SME growth globally.”
The digital transformation of economies and the role of development banks in helping entrepreneurs to harness new technologies formed an important part of the discussion. Some participants highlighted the growing divide between a relatively small group of companies that are able to rapidly adopt digital technologies while others are falling behind. Others expressed confidence that digital technologies will produce major gains in productivity and economic growth. In countries such as Zambia, for example, the spread of mobile phones has enabled growth in business activities through online loans, money transfers, and electronic payments.
On measuring the impact of development bank activities on SMEs, two major areas of concern emerged: the quality and availability of data, and the difficulty of constructing reliable control groups to assess the impact of bank interventions. Identifying enough firms to build a broad, reliable control group to measure impact is difficult, and development bank researchers face severe challenges in accessing public and private data on both clients and non-clients. The economists also shared their experiences conducting research on SMEs to help development banks formulate strategy, share insights with the public, and help entrepreneurs improve their business.