The COVID-19 pandemic has stalled the advancement of the sustainable development goals (SDGs). It is creating many challenges, yet also it unveils opportunities to build back better. In this context, inclusive and sustainable industrial development, which is at the core of SDG9, is expected to play a critical role in overcoming the crisis and setting countries back on the path of economic development.
The achievement of the SDGs in a post-COVID-19 world will require a holistic approach, including strong commitments towards the promotion of structural changes across all sectors of society. In this context, the United Nations Industrial Development Organization (UNIDO) and the United Nations Sustainable Development Solutions Network (SDSN) jointly organized a virtual event that addressed how the pandemic is impacting the SDGs, specifically SDG 9, and the Agenda 2030
UNIDO’s Director General, LI Yong, opened up the event by emphasizing how Agenda 2030 is and still should be the roadmap to recovery. He also touched on the importance of achieving SDG9 to create a more sustainable industrial future and the need for reliable statistics and data, including UNIDO’s Industrial Analytics Platform and SDSN’s new data platform, SDGs Today. Li stated, “We must seize the opportunity to use the disruptive impact of the pandemic on the global economy to seek collaborative solutions to drive the 2030 Agenda.”
Gerhard Küntzle, Permanent Representative of Germany to the UN in Vienna, stated, “It is crystal clear that we must make the next ten years a decade of action and aim to mainstream evidence-based policymaking in the development agenda.”
SDSN President, Jeffrey Sachs, highlighted the need for global collaboration, and how the world should turn toward six transformation pathways to achieve the SDGs amidst the pandemic. Sachs specifically highlighted the need for the first transformation relating to education, gender and inequality, and the sixth transformation relating to a Digital Revolution for Sustainable Development.
“No child can have a future without education,” Sachs said, noting how access to the tools for free digital education for children is achievable with the right global collaboration.
Lastly, Sachs highlighted the need for decarbonizing industry: “Renewable energy is our theme and we must get to zero.”
As Ethiopia has undergone an industrial revolution from agricultural to manufacturing, the next speaker, Arkebe Oqubay, Minister and Special Advisor to the Prime Minister of Ethiopia, discussed lessons learned for the world to apply to achieve progress toward the SDGs. Oqubay highlighted three lessons: 1) Leadership and policymaking will need to be redefined in the new environment; 2) A commitment to green and carbon-neutral industrialization is vital; 3) Smart technologies will enable the wider application and use of green industries.
Last but not least, Professor Oqubay noted that global collaboration has become the foundation for averting global threats and maximizing opportunities.
Ann Rosenberg, co-founder of SDG Ambition UNGC, provided aprivate sector perspective and echoed Oqubay’s insights that all companies need to redefine production lines and industries. She said, “The hope from larger companies is that these smaller businesses and entrepreneurs will come up with new, redefined ways of doing things…There is a collective responsibility for everyone to help.”
Rosenberg stated that it is up to countries to figure out how to collaborate and how to access technology, so that all companies can advance industrially and toward the SDGs. Moreover, Rosenberg highlighted the need for tools to know where we are, so we know how we can close the gap to achieve the SDGs.
Ambassador Martha Lungu Mwitumwa, Permanent Representative of Zambia to UNIDO and to the United Nations and other international organizations in Geneva, remarked on the need for more concentrated efforts towards achieving the SDGs, “With the crisis upon us, it will be far more difficult for Least Developed Countries and other low-income countries to achieve SDG 9. In this Decade of Action, we – as Ambassadors in Geneva – have a crucial role to play, in advocating the importance of industry and innovation, in mobilizing more resources towards it, and in fostering partnerships for leveraging trade, investment and technology to achieve that goal. And, as representatives of our countries to key UN institutions, we can foster greater UN coherence in these matters.”
It was clear that all panellists agreed that global collaboration is imperative to take the world through the recovery from COVID-19. Once out of recovery, panellists stressed how the focus should be on embracing the new, digital world to further three key initiatives: to bring access to education for all, to build sustainable industrialization, and to reach net-zero emissions.
Climate Finance: Climate Actions at Center of Development and Recovery
The Asian Development Bank (ADB) called access to climate finance a key priority for Asia and the Pacific as governments design and implement a green and resilient recovery from the coronavirus disease (COVID-19) pandemic.
Speaking at the United Kingdom Climate and Development Ministerial—one of the premier events leading up to the United Nations Climate Change Conference (COP 26) in November—ADB President Masatsugu Asakawa said expanding access to finance is critical if developing economies in Asia and the Pacific are to meet their Paris Agreement goals to reduce greenhouse gas emissions and help adapt to the adverse impacts of climate change.
“We can no longer take a business-as-usual approach to climate change. We need to put ambitious climate actions at the center of development,” Mr. Asakawa said. “ADB is committed to supporting its developing member countries through finance, knowledge, and collaboration with other development partners, as they scale up climate actions and push for an ambitious outcome at COP 26 and beyond.”
ADB is using a three-pronged strategy to expand access to finance for its developing members as they step up their response to the impacts of climate change.
First, ADB has an ambitious corporate target to ensure 75% of the total number of its committed operations support climate change mitigation and adaptation by the end of the decade, with climate finance from ADB’s own resources to reach $80 billion cumulatively between 2019 and 2030. ADB has also adopted explicit climate targets under its Asian Development Fund (ADF), which provides grant financing to its poorest members. ADF 13, which covers the period of 2021–2024, will support climate mitigation and adaption in 35% of its operations by volume and 65% of its total number of projects by 2024.
Second, ADB is enhancing support for adaptation and resilience that goes beyond climate proofing physical infrastructure to promote strong integration of ecological, social, institutional, and financial aspects of resilience into ADB’s investments.
Third, ADB is increasing its focus on supporting the poorest and most vulnerable communities in its developing member countries by working with the United Kingdom, the Nordic Development Fund, and the Green Climate Fund on a community resilience program to scale up the quantity and quality of climate adaptation finance in support of local climate adaptation actions.
Improving Transport Connectivity in Central Asia Requires a Coherent Approach
The combination of infrastructure and logistics improvements, reduction in border delays and tariffs, and harmonized standards across countries could have a significant positive impact on Central Asian economies, said experts during an online regional briefing “Connectivity in Central Asia: Challenges and Opportunities” hosted by the World Bank.
Studies show that improved transport corridors generate economic development around them. Better road accessibility also allows more people to have access to jobs, education, healthcare, and opportunities, leading to poverty reduction.
“Connectivity is a complex issue and has wide-ranging impacts, affecting businesses, consumers, trade, logistics, economic growth and a country’s overall development,” said Jean-François Marteau, World Bank Country Manager for Kazakhstan. “In Kazakhstan, our analysis shows a clear link between investments in infrastructure and the level of the gross regional product of the oblasts.”
Countries in Central Asia are some of the least connected economies in the world, with the region’s connectivity indicator averaging below 60 percent in terms of the ratio of access to the global GDP – the lowest on the spectrum. The cost to import and export from or to Central Asia remains high, undermining the competitiveness of Central Asian products abroad and resulting in expensive imported goods. For example, the cost of shipping a container from any of the Central Asian countries to Shanghai is five times more expensive than from Poland or Turkey.
“Countries in Central Asia are yet to realize the enormous potential of internal and external trade, and the key here is improving transport connectivity in a holistic way,” said Antonio Nunez, Program Leader for Infrastructure at the World Bank Central Asia. “We see significant returns on investments when they are combined with other improvements in reducing delays and trade tariffs. These measures together could boost the regional GDP by about 15 percent.”
Connectivity within countries in Central Asia is also limited with most areas in the countries suffering from insufficient infrastructure and expensive services, limiting access to services, activities, and jobs, and hindering the tourism potential.
In the past two decades, Central Asian countries invested heavily in improving infrastructure; however, the region still lags behind middle-income countries in terms of both investing and maintaining the infrastructure. Central Asia ranks low on key trade indicators, such as the number of days to clear imports and exports and the Logistics Performance Index.
Despite some recent progress, the latter has either remained at the same level or declined compared with 2010 for all Central Asian countries. According to CAREC data, investing in corridors has paid off in saved travel time due to higher speeds. However, these time savings are often lost at the borders due to inefficient procedures and capacity constraints.
Key challenges in improving connectivity in Central Asia include tackling the low productivity of the state-owned enterprises that dominate the transport sectors in the region, harmonizing the different standards, improving infrastructure quality at local, national, and regional levels, as well as improving governance and efficiency.
“Over the years, the region has launched or become part of numerous connectivity initiatives that vary across types of infrastructure and geographical scope. What is needed now is for the countries to prioritize the connectivity initiatives that work best for their economies,” said Lilia Burunciuc, World Bank Regional Director for Central Asia. “We at the World Bank will continue supporting Central Asia in understanding and improving connectivity through our advice as well as investments, which in the last 10 years have reached over $5 billion in this sector.”
Speakers underlined the importance of greener, more sustainable and smarter transport solutions that are integrated with urban planning to reduce greenhouse gas emissions, improve air quality management systems and reduce air pollution. Globally, transport accounts for a quarter of energy-related GHG emissions. In the Central Asian capitals and larger cities, transport generates particulate emissions that exceed the WHO maximum levels, leading to various diseases and premature deaths.
Political and Security Uncertainty Slow Down Afghanistan’s Economic Recovery
Afghanistan faces a sluggish economic recovery from COVID-19 amid continued political uncertainties and possible decline in international aid, says the World Bank in its latest country update.
Released today, Setting Course to Recovery shows that robust agricultural growth has partially buoyed Afghanistan’s economy, which shrunk by around two percent in 2020—a smaller contraction than previous estimates. However, lockdowns, weak investment, and trade disruptions have hit hard services and industries, increasing hardship and unemployment in cities.
Growth is expected to reach one percent in 2021 and top around three percent in 2022 as the COVID-19 crisis fades. Per capita incomes are unlikely to recover to pre-COVID levels until 2025 due to fast population growth.
“The current political and security uncertainties have created serious hurdles to Afghanistan’s economic recovery from the COVID-19 crisis. A slower pace of recovery means higher unemployment, lower government revenues, and – ultimately – more difficult living conditions for Afghans,” said Henry Kerali, World Bank Country Director for Afghanistan.
A full recovery will be challenging as many firms have closed and jobs were lost. Private sector confidence has weakened amid difficult security conditions, uncertainty about the outcome of the ongoing peace talks, the possible withdrawal of international troops, and potential sharp declines in future international aid support. Droughts are expected in 2021 and will likely reduce agricultural activity, further weakening growth prospects.
The report emphasizes that a strong and sustainable partnership between the Afghan government and its international partners is key to driving recovery and restoring private sector confidence. In that effort, the government needs to accelerate reforms to improve governance, fight corruption, mobilize revenue, and boost business. Simultaneously, donors can support private sector confidence through clearer multi-year aid commitments and by defining measurable priority reforms that condition continued grant support.
The Afghanistan Development Update is a companion piece to the South Asia Economic Focus, a twice-a-year World Bank report that examines economic developments and prospects in the South Asia region and analyzes policy challenges faced by countries. The Spring 2021 edition titled “South Asia Vaccinates,” launched on March 31, 2021, shows that economic activity in South Asia is bouncing back, but growth is uneven, recovery remains fragile, and the economic outlook is precarious. The report also focuses on the different dimensions of vaccine deployment and provides a cost-benefit analysis of vaccination in the region.
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