Discussions about economic growth in developing countries often revolve around a handful of familiar factors: the volume of investments directed at various sectors, whether sourced from domestic finances, foreign direct investment, or remittances from expatriate workers. In some cases, growth is driven by the natural resources a country happens to possess. Strangely, however, productivity remains the ever-present yet overlooked element in development plans. Productivity is the measure of output per unit of input—it specifically refers to the ratio of production to each hour of labour and unit of input in the production process.
In the absence of any policies aimed at increasing productivity, economic growth can still occur, but it does so through cheap labour, abundant natural resources, and sometimes even lax political and environmental regulations that attract foreign capital. This, in its simplest form, is a ruthless depletion of both human and natural resources, not to mention the environmental destruction and the widening of social inequalities that come with it.
Investing in productivity means investing in people and technology. One of the pillars of human development is targeted and measurable investment in education—aimed at fostering self-sustaining growth by improving workers’ efficiency, whether they are machine operators or engineers seeking better production alternatives. Investment in technology, on the other hand, hinges on spending on scientific research and development to establish a continuous cycle of innovation and achievement. This, in turn, creates a competitive advantage on a global scale, serving as both a direct economic resource and a broader developmental success with long-term societal benefits. Investing in people is never a wasted effort—on the contrary, history has proven its value. Take Germany and Japan, for instance. Both emerged from war as economic ruins, yet their people rebuilt their nations through human capital that had already been cultivated through prior investment.
A more comparable example to other developing nations is Singapore. It is not an oil-rich country. Until the late 1960s, most of its population was illiterate, living in tin-roofed shacks that were routinely destroyed by seasonal floods. That was their reality. Yet today, Singapore is a model of economic excellence, often described as one of the ‘graduated nations’—a country that successfully transitioned out of the developing world. From the late 1960s onwards, alongside traditional growth strategies, Singapore adopted productivity as a core pillar of real development. By the 1990s, it had achieved the highest productivity levels in the world. What is striking is how this commitment took shape in national planning. The government organised competitions for the highest productivity rates across industries and treated the issue as a matter of national interest, promoting it in the media. It aligned education policies with actual labour market needs, ensuring a steady supply of skilled workers tailored to industry demands.
Even more remarkably, when a study—later proven inaccurate—suggested that Singapore had lost its top ranking in global productivity, the news triggered a national crisis. The entire country mobilised to reclaim its position, with individuals across all sectors pushing themselves to improve performance. The government aired periodic televised reports to track progress. Eventually, Singapore not only regained its status but outperformed its previous benchmarks, all because of a collective determination to excel—even in response to a flawed study. Meanwhile, in developing nations like ours, this form of growth is largely ignored—even by international development organisations that claim to champion such strategies. Ultimately, vested interests dictate priorities, even among those who present themselves as defenders of the world’s poor. But history has shown time and again that real development cannot be imported—it must be built from within.
This article is originally published by AlBorsa in Arabic and later AI-translated by South Push.