1. Balázs Horváth, Practice Leader, UNDP, Europe and the CIS Bratislava Regional Centre Social and Economic Challenges in SPECA Countries Bratislava, 20 May 2010 AfT Roadmap for SPECA Ministerial Meeting, Baku 1-2 December, 2010

2. Central Asia: Key region in Eurasia

3.  While there is common inheritance… Soviet legacy left many difficult challenges Geography: all Central Asian countries are landlocked  Russia only large market with transport access  China, India: farther, transport routes inadequate  To the closest EU countries is about 3,000 km  There are significant national differences Size (area, population, GDP) Resource endowment Income level Market reforms Economic and political stability Central Asia is not a homogenous region

4. The effect of the global economic crisis ranges from large to none… Source: IMF World Economic Outlook, October 2010

5. But the broader impact on HD may be substantial, lasting, hitting mostly the poor Paper by 3 authors in BRC—on ECIS region as a whole Panel estimate: income elasticities of 12 HD indicators 29 ECIS countries, 1989-2008 –poverty rates, –unemployment, –incidence of diseases, –under-five mortality, –life expectancy, –crime rates. Then: projecting HD indicators using GDP forecasts

6. Potential Impact of the Crisis Male life expectancy at birth, years

7. Potential Impact of the Crisis Poverty $5 at 2005 prices

8. The region has huge opportunities… Huge natural resource endowments * oil, gas production already considerable * large reserves remaining * other mineral wealth * massive hydropower, solar & wind potential Young population, generally good education levels  Potential for :* dynamic labour force * competitive economy * demographic dividends, rather than time-bomb In past decade: expanding fast Growth economies now closer: China, India, Turkey, each other…

9. …but in some SPECA countries, per capita GDP remains very low Per-capita GDP, in US$, PPP terms, 2008 Source: World Development Indicators

10. To promote trade and investment: Harmonized, predictable regulatory and legal framework stable economic growth for all people & all territories new, well-paying and sustainable jobs poverty reduction, social inclusion To promote joint interests, better manage/handle shared water, energy and environmental resources (e.g. Aral Sea) common infrastructure common challenges: environment, health, disaster preparedness labour migration illicit drug trafficking; crime and terrorism. To fulfil potential and to reach sustainable development: regional cooperation needed

11. Trade can be a powerful source of economic growth & HD It can bolster broadly based growth & progress toward MDGs; Better resource allocation (efficiency, job gains) can raise growth and lead to poverty reduction & HD. Final note: growth necessary but not sufficient for HD (GHDR). In focus at this Conference: Trade and Human Development

12. Thank you for your attention… United Nations Development Programme, Europe and the Commonwealth of Independent States, Bratislava Regional Centre http://europeandcis.undp.org Balazs.Horvath@undp.org