Research embraces CBDCs, highlights its importance in fulfilling SDGs in New Zealand

Development with sustainability is considered the most debated topic in contemporary civilisation. Both developed as well as developing countries are rigorously working on the same end with different means and actions. The major aim of countries is to develop a better world pondering economic growth, equality, equity, tolerance and inclusivity.

The United Nations in the year 2015, published 17 sustainable goals on the same line for balancing growth and development. The Sustainable Development Goals, or SDGs, were a set of universal goals adopted by the United Nations General Assembly to create a more sustainable future for all.

Recently Qionghua Chu from Nanyang technical university published a research paper highlighting New Zealand’s Outlook with Central Bank Digital Currency (CBDC) and SDG 8. It is important to note that SDG 8 promotes sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all. It fosters the concept of a green economy, sustainable tourism etc.

The paper underscores that despite the current inverted yield curve environment, the positive impacts of the potential issuance of the CBDC on achieving SDG 8 could potentially enable the fulfilment of other goals. Besides, not only could SDG 8 help to fulfil other goals as the economy might be the root to provide funding and resources, they create a healthy ecosystem to enable SDG 8 to be realized more efficiently and effectively in New Zealand.

As highlighted in the research, with the potential introduction of the CBDC and the process of fulfilling SDG 8, with more education, training, and employment opportunities in high value-added and less labour-intensive sectors related to hardware and software infrastructures of the CBDC and its associate industries, households might directly or indirectly experience an increase in the disposable income. More consumption from households might stimulate more business investments, leading to more decent jobs to be created and economic growth.

Moreover, with reduced poverty, SDG 2 of zero hunger could potentially be solved. With more decent work, economic growth, and reduced poverty, children might be able to have more nutritious food such as fresh fruits and vegetables, with more nutritious food, not only will consumption rise, but business investments in and demand for workers in food and beverages, farming, rural infrastructures, food manufacturing, transportation, and other related industries might also increase, ceteris paribus, leading to more decent work and economic growth to fulfil SDG 8.

In addition, while SDG 2 is progressing to be fulfilled, SDG 3 of good health and well-being might be achieved. Furthermore, as more decent work and economic growth are in the process of being achieved, more government budgets could be efficiently allocated to healthcare and other sectors. Correspondingly, when general health and well-being level increases, workers might be
more fit to work, resulting in more disposable household income. Consequently, more people are
willing and able to consume, resulting in more consumption, vibrant business activities, investments, and decent work creation.

Further, the fulfilment of SDG 3 enables children to be healthy enough to receive a quality education, i.e.,
SDG 4. Thereby, not only could SDG 8 help to realize SDGs 1, 2, 3, and 4, but so will the latter help the former. Thus, the remaining goals are directly or indirectly linked to SDG 8. Here, policymakers could consider implementing the CBDC with not only decent work and economic growth in mind but also include other considerations to enable a holistic fulfilment of SDGs.

As the paper concludes, one way is for the policymakers in various institutions to work on how the CBDC could be implemented in both the financial and related sectors to set up the hardware and software infrastructure to achieve sustainable decent work and economic growth and ensure sustainable development in related goals. Another way is for the policymakers to develop a road map of which goals to fulfil first with the potential issuance of the CBDC in mind to enable the efficient and effective realization of the SDGs.

The research in recommendations emphasized collaborations with international partners to gain insights into the benefits and challenges of issuing the CBDC could be an option for policymakers in New Zealand to consider. It can be said that while achieving all 17 SDGs by 2030 might seem challenging, by focusing on fulfilling SDG 8 via the issuance of the CBDC in consideration, the other 16 goals might be more easily achieved.

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