Andres Oppenheimer

The world’s most promising countries were basket cases a few years ago

Singapore turned around its disastrous economy by investing heavily in its citizens’ education.
Singapore turned around its disastrous economy by investing heavily in its citizens’ education. Getty Images

If you think that most developing nations are hopeless — or, as President Trump reportedly said, that some of them are “shithole countries” — you should take a look at the World Bank’s new ranking of the world’s most promising nations: Most of them were basket cases not so long ago.

The World Bank’s Human Capital Index, released on Thursday, measures 157 countries according to their children’s knowledge, skills and health.

Its underlying rationale is that — in a world economy that relies more and more on mental work and increasingly less on manual labor — young people’s health and education standards will be the keys to economic progress. As robots and artificial intelligence take over growing numbers of low-skilled jobs, there will be a growing need for well-educated workers who can do more sophisticated work.

Singapore is the No. 1 country in the new index, followed by South Korea, Japan, Hong Kong, Finland and Ireland. Among those further down the list are Sweden (8), Germany (11), the United Kingdom (15), Israel (23), the United States (24), Russia (34), Chile (35) and China (46).

Most Latin American countries are in the middle tier. Costa Rica ranks 57th, followed by Argentina (63), Mexico (64), Ecuador (66), Uruguay (68), Colombia (70), Peru (72), and Brazil (81).

But what’s really interesting about this and similar rankings by other international institutions is the speed with which some formerly poor and corruption-ridden nations can become success stories.

Singapore was such a disastrous colony that Great Britain, in effect, abandoned it in 1963, and Malaysia took it over. But soon, the Malaysians left, too, and Singapore became independent in 1965.

At the time of Singapore’s independence, its per capita income was similar to that of Mexico. Today, Singapore’s per capita income is higher than that of the United States, and four times higher than Mexico’s.

Singapore’s secret was that, in part because it didn’t have natural resources, it decided to invest heavily in its people’s education. Like South Korea and Japan, it has a national obsession with education.

When I visited Singapore a few years ago, one of the things that most struck me were the $2 bills. Instead of having the image of their independence heroes, they have the image of a university and a professor giving a lecture to his students. Underneath that image appears, in capital letters, the word “Education.”

In some of these top ranked countries, only students who graduate in the top 10 percent of their class can apply to become teachers. And once they do, they are often paid according to their performance in the classroom and enjoy a relatively high social status.

By comparison, in most Latin American countries, teaching has become one of the worst paid and least respected professions. In many cases, myopic and corrupt teachers unions demand higher salaries, but refuse to accept teacher evaluations, or merit pay for good teachers.

Jaime Saavedra, one of the leading authors of the Human Capital Index, told me in a telephone interview that the problem with most Latin American countries is their lack of education “meritocracies.”

“Learning levels in Latin America are below what one would expect considering the region’s income levels,” Saavedra told me. “It’s not just an issue of paying teachers better, but that their pay be tied to their performance.”

I agree. And I’m worried that some countries in the region may even go backwards. In Mexico, president elect Andres Manuel Lopez Obrador has promised to overturn recently established teacher evaluations. In Argentina, teachers’ unions are demanding higher pay without accepting teacher evaluations or even bonuses for teachers who don’t miss work days.

It’s no coincidence that the countries with the highest education standards are becoming richer. And vice versa — those without quality education are losing economic ground.

The good news is that no nation is genetically doomed to be poor. As the new World Bank rankings show, there are no “shithole” countries.” Nations that are serious about improving their education standards, like Singapore, can turn from basket cases into star economies in amazingly little time.

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