The World Bank (WB) defines human capital as consisting of the knowledge, skills and health that people accumulate throughout their lives, enabling them to realize their potential as productive members of society. Without human capital, countries can neither sustain economic growth nor compete effectively in the global economy.
It is estimated that in developing countries 21.3 percent of young children are physically stunted. In some countries children acquire significantly fewer years of learning than in other countries despite being in school the same length of time. People spend over 80 dollars per person out of their own pockets annually to access health services and such expenses hit the poor hardest. In the world’s poorest countries, 4 out of every 5 people are not covered by a social safety net and are thus extremely vulnerable.
The Human Capital Project
Spurred on by the need to prod national governments toconcentrate efforts at building human capital, the WB unveiled its Human Capital Project in 2017 and followed it up with the launch in October 2018 of the Human Capital Index.The Human Capital Project seeks to prioritize transformational investments in health, education and social protection. The objective is to generate rapid progress toward a world in which all children are well nourished and ready to learn, can attain real learning in the classroom, and can enter the job market as healthy, skilled and productive adults.
The Human Capital Index is a summary measure of the amount of human capital that a child born today can expect to acquire by age 18, given the risks of poor health and poor education that prevail in the country where she lives.In sum the Index outlines the productivity of the next generation of workers with a projection from a benchmark of complete education and full health.
The Africa Human Capital Plan
Launched in April 2019, the Africa Human Capital Plan of the WB sets out clear targets and commitments to boost Africa’s potential through its human capital. Under this Plan, emphasis is placed on women empowerment and acceleration of Africa’s demographic transition.Over 2.2 billion dollars worthof new projects will advance African women’s agency, health, education and employment opportunities. Other priorities include road safety in transport projects and electrification of all health centers and schools in Africa by 2030.
Recent Happenings
According to a report unveiled by theWB, the world notably Africa has made progress in the field of education and child health over the past ten years. The gains made however have come under the threat of the COVID-19 pandemic.It is feared that Africa has lost human capital as a result.
The president of the World Bank David Malpass, in a recent interview he granted RFI, announcedthat the number of people who have fallen into extreme poverty as a result of the pandemic has increased by more than 100 million. The news is worrying because as he noted, poverty brings in its wake “problems in education and health and calls again into question the capacity of a country to develop.”
Forging ahead again in education
The WBis concerned thatthe closedown of schools for several weeks during lockdowns could have more serious consequences than expected. David Malpass estimates that a billion children across the world have been left behind because they did not go to school. The need therefore arises to quickly get going again and forge ahead in the field of education.
Faced with this troubling observation, the WB intends to offer solutions. From now on, itis channeling a part of its investments to sectors connected with human capital development, education and health. Thus in the Sahel the WB is financing a programme named “Swedd” whose objective is to among others enable girls to be kept in school.
The WB will disburse 160 billion dollars over a period of one and a half years to combat the effects of the pandemic.
Food for thought
The 2018 Human Capital Index revealed that African children would achieve only 40 per cent of their potential because of human capital deficits.Relying on pre-covid-19 data, theupdated Index indicates thata child born in Ghana in year 2020 will be 45 percent as productive when she grows up as she could be if she enjoyed complete education and full health. This projected score is higher than the average for the Sub-Saharan Africa region but lower than the average for Lower middle income countries. Considering the widespread deleterious impact of the coronavirus pandemic, the 2020 Index forecast for Ghana could actually be grimmer.The package of remedial measuresbeing considered may have to take this observation into account in addition to the recommendation by the World Bank thatcountriesmust strengthen gender disaggregation in reporting.
By Pius Acolatse
The writer is a member of staff of the Ghana Parliamentary Service
