The article provides an overview of the global economic landscape in which the contemporary skills development discourse is located. Effective skills development oriented to market needs and to competitiveness in high-value global value chains will help developing economies to avoid the middle income trap. It outlines major issues and challenges that developing economies need to deal with in crafting appropriate policies and strategies for skills development: addressing the persistent problem of skills-jobs mismatches, strengthening the participation of the private sector to increase market-oriented training, assuring inclusive growth, preparing for the expansion of green economy opportunities, and increasing emphasis on soft skills. It also provides an introduction to the various articles in the special issue.