Insurance companies, pension funds, and other institutional investors in Asia and the Pacific can pave the way to a resilient and sustainable future.

The recent global public health crisis has revealed that economies can no longer afford to return to old ways of doing things. But there could be a silver lining in a coming “age of sustainability” in Asia and the Pacific that can get countries growing strongly again.

Reaching this new age, however, will require greater use of insurance companies, pension funds, and other institutional investors to tap the region’s well-known and huge pool of savings. Asia’s savings rate is very high, at about 27.11% of gross domestic product, ranging from 40.24% in Singapore, 30.20% in India, and 24.86% in the Philippines, to 14.23% in Georgia.

It calls for a more diverse range of infrastructure investments that meet environmental, social, and governance goals. And it needs measures that can allow corporations and households to invest more widely.

For now, high public debt, rising domestic spending, and adverse exchange and interest rates are constraining fiscal space. In addition, governments’ inability to implement countercyclical fiscal policy to respond and mitigate the adverse effects of external shocks by increasing expenditure or reducing taxes to create a demand, worsens these constraints.

Read more @Nation