Driven by shifts in the global economic landscape, the perception of industrial policy has evolved from skepticism to a recognition of its strategic importance. This paper identifies emerging patterns in industrial policies in several key countries, highlighting trends in government interventions, sectoral priorities, and policy instruments. Today’s industrial policies are more innovative, inclusive, and collaborative, offering greater flexibility in design, relaxed selection criteria, and adaptable conditionality requirements.

Policy Recommendations

• To strengthen industrial policies, policymakers should adopt a more flexible and inclusive approach, integrating targeted strategies across sectors and firm sizes. Policymakers can expand support beyond traditional manufacturing to encompass services, recognizing their growing role in global value chains. Focusing on SMEs alongside large corporations will foster innovation and regional economic growth.
• Policymakers should also enhance data-driven decision-making by incorporating real-time feedback from the private sector to address market information gaps. To achieve this, governments could develop collaborative platforms that enable businesses to participate voluntarily in policy initiatives, thereby ensuring broader engagement.
• Countries should offer customizable financial support and adaptable conditionality based on firm performance and market shifts, ensuring resources are allocated where they are most needed. Infrastructure development, including digital and automation tools, should be prioritized to support industry-wide growth to foster innovation and resilience against economic disruptions.