Countries with high Sustainable Economic Development Assessment (SEDA) scores - indicating higher levels of societal well-being - are more resilient and suffered less of an impact in the first year of the pandemic, according to a research by Boston Consulting Group (BCG).
The finding is based on analysis of data from BCG's latest SEDA index and the corresponding article, "Economic Resilience Is Built on Societal Well-Being," being released on Wednesday. The analysis offers insights and strategies for global leaders gathering for the G7 Summit.
The SEDA analysis finds that countries with improved ability to convert wealth into wellbeing saw a smaller drop in their 2020 real GDP growth rate. Countries with high SEDA scores were also better able to limit the growth in unemployment during this time.
"BCG has been a strong advocate of the need for countries to focus policies and development strategies on improving well-being," said Vincent Chin, global leader of BCG's Public Sector practice and co-author of the article. "COVID-19 has brought in a new dimension - an opportunity to observe how such efforts make countries more resilient in a crisis."
The article also highlights three dimensions that could have a multiplier effect in increasing well-being and should be prioritized by governments. These include taking steps to slow down climate change, investing in digitization, strengthening social protection systems to ensure sustainable and equitable growth.
"As countries continue fighting the pandemic, they need to think long term and make investments today that will lead to faster and more sustainable progress during the coming recovery," said Christian Schwaerzler, BCG's global topic lead for Economic Development and co-author.
"We need to move beyond seeing resilience as simply a defensive strategy. Resilient countries are not only better placed to withstand shocks like the recent pandemic, but we see strong evidence that their economic rebound is quicker. The pandemic has also reinforced the need for governments to look beyond income growth and GDP and focus on the broader goal of overall well-being."
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