VIENNA, 29 November 2017 - The United Nations Industrial Development Organization (UNIDO) launched its 2018 Industrial Development Report (IDR) on Demand for Manufacturing: Driving Inclusive and Sustainable Industrial Development, today, at an event held on the sidelines of the seventeenth session of the UNIDO General Conference. The main findings of the report were presented and discussed with a panel of leading experts in the field of industrial development.
Although industrial development has typically been studied from a supply-side perspective, by placing demand at the centre of attention, this year’s Report acknowledges the role of manufacturing industries as major providers of new and improved goods. It considers the importance of demand as an important driver of industrial development and what policies can be implemented to steer demand towards the achievement of inclusive and sustainable industrial development.
From a demand perspective, the importance of industrialization can hardly be overestimated. Manufactured goods account for up to 60 per cent of household consumption worldwide. Moreover, industrial goods tend to become cheaper over time, reaching a growing number of consumers.
The IDR 2018 highlights the fact that the consumption of manufactured goods is an important catalyst for the achievement of SDG 9. Without a critical mass of consumers, industrialization cannot take off and be sustained over time.
The report presents new evidence on the relative roles played by domestic and global sources of demand in driving industrialization. Domestic demand for manufacturing goods is a key driver of growth. Its relative importance has been growing in recent years, driven by the emergence of a consumer class in emerging industrial countries. The extent to which countries benefit from domestic demand, however, crucially depends on the distribution of income – with more unequal countries experiencing lower growth – as well as on a country’s level of industrialization.
The report also warns about the environmental impact of increased consumption, and calls for a shift in consumption patterns towards the purchase of environmental goods that minimize use of natural resources and toxic materials, as well as emissions of waste and pollutants.
A key message of the report is that the development of green industries requires major shifts in consumption patterns towards the purchase of environmental goods. Important barriers to the widespread consumption of environmental goods produced by green industries need to be removed. These include too high prices, gaps in consumer awareness of environmental concerns and biases in purchasing behaviour.
The Industrial Development Report series is an established source of reference on industrial development. Previous editions have examined the driving forces of industrialization and the positive factors that can lead to social inclusiveness and environmental sustainability. They have examined crucial components of the production side of industrialization, such as capacity building, energy efficiency, employment creation and technological change, to mention just a few.
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