Economic development should not only be measured by the amount of finance mobilized or the amount of fiscal space created. It should also be judged whether emerging countries are better able to set their own priorities, respond to challenges, and seize new opportunities to shape their own future.
BRIDGETOWN—We tend to think of a nation’s assets in terms of natural resources, technology, and capital. But equally important is the ability to shape the future itself, as opposed to its development being determined mainly by external factors.
Major global stressors in recent years have brought this fact into sharper focus. COVID-19, rising interest rates, soaring energy prices, and the escalating climate crisis are forcing many small countries into perpetual firefighting mode. For the most indebted and least diversified economy, each new upheaval has thrown out years of planning, leading to higher investment in resilience. But resilience alone is not enough, because states can do everything right and still be worse off without genuine agency.
The true test of development is whether it expands the country’s options and capabilities. This vision is behind the Barbados-led Bridgetown Initiative, which seeks to create a more responsive financial system, unlock affordable long-term finance, and develop better tools to manage shocks. It is a country that must maintain its national goals when a crisis erupts.
Small countries know this very well. For them, uncertainty is not a problem, but a constant state of things. He was thinking about disaster preparedness and strategic autonomy before the topic became a regular item on the international agenda. The challenge is not to eliminate vulnerability entirely, but to maintain freedom of action even when it exists. In a world of geopolitical tensions and rising climate risks, the agency is one of the most valuable assets a country can have.
The current era of development reform proposals is understood to focus on developing the fiscal and policy space needed to help countries in climate crisis. However, what matters most is whether the investment leaves stronger institutions, deeper expertise, more competitive companies, and a greater capacity to solve complex problems.
Although the international system has become more effective in financing projects—from roads and energy systems to hospitals and digital infrastructure—development cannot be reduced to a series of investments or line items on the balance sheet. The more difficult task is building the means to plan, deliver, maintain, and expand these investments.
These skills are not limited to infrastructure. Consider Barbados’ experience with sovereign debt restructuring, debt moratorium clauses, and debt-for-hold transactions. None of these innovations arose by accident. They need discipline in economic management over a long period of time, political leaders who are willing to withdraw their negotiating teams from years of difficult, unpleasant work, and policymakers who develop their expertise by dealing with problems that have no clear precedent.
The same lesson applies to the wider economy. Barbados is now seeking to build on a decade of climate-finance leadership while developing ambitious food security, social protection, and energy independence initiatives at home. We know that increasing battery storage capacity and pursuing the nation’s first utility-scale wind project requires more than a technical plan. These investments require coordination between ministries, regulators, the private sector, financiers, and neighboring communities. Success depends on bringing all these players together to resolve disputes, structure viable bids, and keep projects moving when obstacles arise.
A recent experience in Barbados reveals the broader reality of how expertise is built. People learn by doing, and institutions, by extension, learn through the people who build and support them. Capacity is built through negotiating difficult deals, delivering projects, managing crises, learning from mistakes, and taking on more complex responsibilities. Technical skills are important, but so are incentives, trust, continuity, authority to act, and time to think and experiment.
In addition, developing countries need companies that can compete internationally, use new technologies, and respond to market changes. Development succeeds when the public and private sectors reinforce each other.
No country develops these capabilities overnight. They are acquired through repeated exposure to difficult situations. Barbados recently lost its Chief Fisheries Officer, and his death is still being felt in the sector he helped transform. He knows almost every fisherman by name, introduced technology that modernized the fleet, and earned the trust of a community struggling to attract younger talent. His contribution was not only technical. They also bring with them decades of accumulated knowledge, relationships, judgment, and credibility.
That is often the way institutional memory works in small countries. Expertise is in the people before they are put into the system, and if important individuals leave or die, the entire country development agenda can be undone. In addition to developing talent, developing countries must also ensure that knowledge, relationships, and experience become institutional assets rather than individuals.
The same principle applies to external support. Development partnerships are most effective when they strengthen the ability of countries to produce results for themselves. Governments cannot treat institutional strength as a mere byproduct of reform. They must create strategic goals, embedded in the organization that can maintain continuity through political cycles and personnel changes.
Of course, the ability to emphasize does not reduce the importance of affordable financing, access to technology, or trading systems that allow resource-rich countries not only to export raw materials, but also to process, create, and innovate, thereby creating jobs, developing skills, and keeping more value inside. Agencies cannot be separated from the broader systems in which they operate, and significant structural constraints remain.
But at a time when the global agenda is being set by a constant cycle of conferences, summits, communiqués, and new initiatives, it is necessary to step back to ask a more difficult question: Can countries really make decisions, produce results, and determine their own course?
Next generation development reforms should not be measured only by the amount of finance mobilized or the amount of fiscal space created. It should also be judged from the extent to which emerging countries are better able to set their own priorities, respond to challenges, and seize opportunities. The true measure of success is whether the country gains the capacity and confidence to shape events, rather than being shaped by them.