BTW, Speaking about justice…

Wales, Competitiveness and Recognition

Posted on: April 20, 2010

Why is competitiveness important if we’re talking about justice?

Competitiveness reflects effective management and utilisation of resources (people, capital, and so on) resulting in high productivity. Living in a market-based society, productivity translates to standards of living. Higher productivity means higher standards of living.

Wales in ‘desperate state’ as UK’s least competitive region was on the news today. A number of reactions came out of that, mostly revolving around demands for more economic devolution, inclusion in UK’s high-speed rail plan, and increase in Welsh Assembly Government strategic role and capability.

The Welsh Assembly Government was viewed earlier this year as to not having the right approach because they’ve spent more in economic development compared to Scotland and North East england, yet Wales remains at the bottom of the competitiveness rankings. So what does it take to build competitiveness?

1. Regional Specialisation

If Wales is to be competitive, first there has to be a focus on determining what the agenda is. Having a clear goal to achieve and a timeframe on that achievement will cascade to clearer vision on what resources are needed, how to go about finding and managing those resources, and the wider context of that goal. If Wales is to be competitive, specialise, specialise, specialise. 

Scotland has fishing, tourism, education. England diversifies between services (business, financial, distribution) and industries (pharmaceutical, automotive, aerospace, manufacture). What do Wales have to offer? There has to be something! Many things! Contrary to classic views, competitive advantage can be built.

2. Capacity Building & Development

Being competitive is not so much in what, but more on how a region competes. The key is capacity building and balanced development of the state, market, and human capital.

The Welsh Assembly Government should have sufficient autonomy and sophistication to formulate and execute policies. Not only autonomy in its relation to Westminster, but autonomy from market and social pressures that hold potential to deviate the government from its development focus. Better public service delivery, sound social infrastructure, efficient political institutions, these are the domains of the state that should be built and developed.

Human capital should also be developed. Putting the right people for the right jobs, the right roles, not just putting people in jobs for the sake of keeping employment rates high. Everybody should be able to live up to their potential. Nobody should be left behind. A competitive human capital has the capability to transform labour into value through competence and knowledge. Economic advancement today relies heavily on the generation and utilisation of knowledge. Human capital is an important aspect.

What is economic development without the business? Business capacities should be developed just as much. Entrepreneurial mindsets, quality of operations and execution of business strategies are major determinants of competitiveness. Industrial focus and priorities, non-market agility (i.e. adapting to international environment, social campaigns and political movements). Growth and performance rest on innovation strategies. What to purse and whether they are compatible with other strategies.

There is much to be done in building capacities.

3. Clarification In Public and Private Roles

Learning from the successes of emerging economies, one of the key to development is the capability of effective states in filling for sectors that are neglected by market forces. States have the role of ensuring fair distribution of goods and services. When certain goods are not being produced by the market, the state has to be able to step in and make the investments needed. When goods are produced by the market, the state should have the capability to enforce fair distribution.

The Economic Renewal Programme requires innovative and strategic thinking, yes. It is a roadmap set out by the state based on a large number of considerations. Building competitiveness is key to Wales’ economic development, yes.

But before everything else, Wales has to be recognised as an economic entity because only then can Wales position itself strategically relative to other economic entities; regardless the level of decentralisatio Wales is currently at.

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Lishia Erza

Searching for answers about life, these are the ones I have found.

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