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Investment Facilitation – A New Governance Approach to Promote Foreign Direct Investment for Sustainable Development

17. April 2019 - 16:07

Photo by WTO/Flickr (altered) https://www.flickr.com/photos/world_trade_organization/38338987184/in/album-72157690815449785/

In order to reach the Sustainable Development Goals (SDGs), enormous amounts of investments are needed in areas like health, education, infrastructure, and the adaptation to climate change. To harness the advantages of foreign direct investment (FDI), it is critical that governments have policies and regulations in place that do not only help to attract and retain FDI but also enhance its contribution to sustainable development. In this context, discussions about the establishment of an international framework for investment facilitation have intensified in recent years.

What’s new about investment facilitation?

Put simply, investment facilitation is about creating a predictable, transparent and efficient investment environment for foreign and domestic investors. Therefore, changes need to take place primarily on the national level. For decades, international organizations and bilateral donors have been supporting developing countries in implementing investment policy reforms. Many of the policy prescriptions are well-known, too, so what’s new about the discussion on investment facilitation?

As we argue in a recent paper, the new aspect is that a group of developing and emerging countries are driving a policy process aiming at establishing an international framework for investment facilitation.

International rules for investment facilitation are rare. International Investment Agreements (IIAs), formulated and promoted mainly by developed countries, have been the backbone of the investment regime for the past 60 years and typically do not cover provisions that aim at facilitating investments. Instead, they rely on rules on better market access and higher investment protection, backed up by investor-state dispute settlement (ISDS), to promote FDI. Academic research about the effects of IIAs on FDI is inconclusive.

IIAs are typically unbalanced, as they impose binding and enforceable rules on host states while demanding little to no responsibilities from foreign investors. In contrast, non-compliance or misconduct on the side of the host country can become excessively costly. To date, more than a thousand ISDS cases have been filed against host states, most often by investors from developed countries. These cases can be costly for host states. For example, Venezuela had to pay 1.2 billion USD to Crystallex, a Canadian corporation engaged in gold mining and exploration.

A few countries, however, have departed from the traditions of the international investment regime as laid down in the treaties designed by developed countries. Brazil’s Cooperation and Investment Facilitation Agreements (CIFAs) illustrate a novel approach to international investment rule-making. As their name suggests, CIFAs focus on investment facilitating measures. They promote continued communication between host state and investor (e.g. by the establishment of contact points and ombudspersons), dispute prevention mechanisms, and state-to-state arbitration as a last resort. Brazil’s CIFAs, therefore, focus more on process and working on the basis of mutual trust in contrast to the policy prescriptions favoured by developed countries’ IIAs.

Structured Discussions in the WTO

The interesting aspect is that countries like Brazil, but also China and other emerging countries such as Columbia, are advancing discussions on investment facilitation within the WTO. To trade and investment watchers this is an astonishing development, as international investment rule-making in the past has been promoted by developed countries – for example, in the context of the negotiations on a Multilateral Investment Agreement (MAI) in the Organization for Economic Co-operation and Development (OECD) during the 1990s – while developing countries have ever fiercely opposed such initiatives. Remember 2003 when developing countries walked out of the room at the WTO ministerial conference in Cancun in protest against the so called Singapore Issues that included investment?

Times have changed! In the run-up to the WTO Ministerial Conference in Buenos Aires in December 2017, a handful of mainly middle-income countries put forward proposals on investment facilitation. Although the Ministerial Conference in Buenos Aires failed to reach a consensus, a group of 70 WTO members, including both developed and developing countries, signed a Joint Ministerial Statement calling for the start of “structured discussions with the aim of developing a multilateral framework on investment facilitation”.

 

Inclusive Approach

Among the 70 signatories of the Joint Ministerial Statement, 60% represent high income countries, 33% are middle income countries, and 7% are low income countries (see map). Together they account for 62% of the global inward FDI stock and 67% of the global outward FDI stock. However, only five African countries have signed the Joint Ministerial Statement. Other important non-participants from the developing world are India, Turkey, South Africa, and the South East Asian economies Indonesia, Thailand, Vietnam, and Philippines. Overall, the US constitutes the largest non-participant accounting for 24% of the inward and outward FDI. It is most striking, however, that the bulk of non-signatories are less and least developed countries. Paradoxically, those are the countries that could benefit the most from an international investment facilitation framework.

As the structured discussion within the WTO are well under way since March 2018 and may lead to proper negotiations in the near future, it is pivotal to put the discussions on a broader footing and get more developing countries on board. Many developing countries still fear that developed countries may try to put controversial issues like market access, investment protection and ISDS back on the agenda. They also fear that an international framework may limit their policy space and strain their administrative capacities needed to negotiate and implement international rules on investment facilitation. Against this background, it is critical that emerging countries ensure the international discussions stay focused on investment facilitation and enhance the contribution of an international investment facilitation framework to sustainable development.

Der Beitrag Investment Facilitation – A New Governance Approach to Promote Foreign Direct Investment for Sustainable Development erschien zuerst auf International Development Blog.

Post Katowice COP 24 – need to go beyond “Business as Usual” to accelerate zero-carbon electricity generation

3. April 2019 - 14:00

Geopolitical concerns have taken centre stage pushing back concerns about climate change. There is the nuclear threat in the Korean peninsula, the threat of deepening trade wars between the USA and China and threats over digital warfare and fake news of all kinds.

While these geopolitical concerns are very real and require full attention of the world leaders and the international community at large, the threat of climate warming remains as real as ever but has taken second stage. This is happening despite the fact that the latest report of the Intergovernmental Panel on Climate Change (IPCC) warns that global temperatures are heading towards +3°C above pre-industrial levels rapidly increasing the likelihood of catastrophic climate change.
The IPCC report also states that global CO2 emissions need to decline by 45% from 2010 levels by 2030. Furthermore, renewables are expected to provide up to 85% of global electricity by 2050, coal is expected to be reduced to close to zero and global net zero emissions be reached by 2050. The report also states that in order to limit global warming to 1.5°C, it will involve „annual average investment needs in the energy system of around $2.4 trillion“ between 2016 and 2035.

In other words, the business as usual of talking rather than acting is not a sustainable solution anymore. More needs to be done rapidly to stop climate warming. The two week 24th Conference of the Parties (COP24) of the United Nations Climate Change Conference (UNFCCC) in Katowice in December 2018 ended with an agreement on a rulebook to implement the 2015 Paris Agreement but de-carbonisation is left to countries’ own political willingness to do the necessary steps of drastically cutting back carbonisation as part of their Intended National Determined Contributions (INDC).

What can be done now?

In light of the slow COP process, what is needed is an agreement to speed up development of renewable energy in form of electricity in Least Developed Countries (LDC) and Low-income countries (LICs). These countries are low emitters of CO2 so far but in light of their growing populations sizes and their development needs, providing renewable energy based electricity could help them meet energy demands while at the same time avoid high CO2 emissions in the future.

Progress has been made in terms of providing more renewables on a global level however one should take into consideration that the current data shows that global electricity generation by source, shows a share of renewables of 23.5%. However, when deducting the share of hydropower of 17.2%, only 6.3% are related to non-hydro renewables like solar, wind and bioenergy. The potential for building more water dams to generate hydro-electric power in LDCs and LICs is limited from a geographical point of view and building large size water dams often negatively affect the local population and implies high financing costs, operational risks and potential cross-border conflicts. In comparison, solar panels and wind farms are less expensive and can be more easily deployed.

Speeding up the development of renewable energy sources in LDCs and LICs could be supported if member countries of the UNFCCC use their NDCs to strengthen investment in renewable energy. On the other hand, WTO member countries involved in negotiating trade in energy goods and services could offer support and trade concessions to LDCs and LICs to help them regulate and facilitate production and purchasing of alternative energy technology.

Such support measures could for instance include making technology for renewable energy available through transfer of technology based on favourable treatment of interlinked property rights. Another support could be asking international enterprises investing in renewable energy in LDCs and LICs to employee local staff and train them in maintaining renewable technology. Another support could be helping these countries to develop local suppliers of component parts of renewable energy technology and creating local knowledge through joint ventures and public private partnerships. The best placed organization to bring about rapid improvement of renewable energy provision, is the United National Industrial Development Organization (UNIDO).

And in case of energy emergency, countries could apply compulsory licence measures to get renewable technology immediately in case the patent holders are not willing to agree to win-win solutions of joint technology use. Some of the above suggestions might clash with established trade and investment rules and need to be carefully assessed by all parties involved.

The role of the High Level Political Forum (HLPF)

As discussed above, providing electricity through renewable energy sources will be crucial in combatting climate warming in LDCs and LICs. A promising approach is to align the support for renewable energy with the Agenda 2030 by all parties involved – developed or developing countries. For the next 11 years, there will be an annual High Level Political Forum at the UN in New York to discuss countries’ implementation of the Sustainable Development Goals (SDGs). These meetings are convened under the auspices of the Economic and Social Council and this year’s HLPF will be held on 9-18 July 2019. This year’s title is Empowering people and ensuring inclusiveness and equality and the following goals with be discussed namely   Goals, 4, 8, 10, 13, 16 and 17.

Linking SDG 13 (on climate change) with SDG 10 (reduce inequality within and among countries) and SDG 8 (sustained, inclusive and sustainable economic growth) offers a much needed opportunity for the international community to discuss how to stop climate warming while at the same time reducing inequality and providing sustainable economic growth. In the context of the renewable energy promotion, it will be important to also take SDG 7 into account which includes three targets: universal access to energy services by all; doubling the rate of energy intensity improvement; and doubling the share of renewables (in final energy), all by 2030. However, the results of the 2017 Global Tracking Framework (GTF) report indicates that the world is not on track to achieve the SDG 7 renewable energy indicator and business-as-usual projections suggest limited growth acceleration till 2030 – therefore significant additional efforts are needed (.http://www.worldbank.org/en/topic/energy/publication/global-tracking-framework-2017).

Conclusion

Climate Warming continues and the increase in world temperature has reached alarming heights. Taking into account the warning of the great majority of scientists, there is real risk that keeping a global temperature rise this century well below 2 degrees Celsius above pre-industrial levels is seriously in jeopardy and countries have to do much more to honour their commitments given at the Paris Agreement.

Business as usual that is publically confessing good intentions (fighting climate change) while at the same time insisting on conventional IP protection needs to be reassessed and solutions be found at the coming HLPF to accelerate the use of renewable energy sources across the globe for the benefit of all.

Der Beitrag Post Katowice COP 24 – need to go beyond “Business as Usual” to accelerate zero-carbon electricity generation erschien zuerst auf International Development Blog.

Zum Tod von Klaus Billerbeck

27. März 2019 - 14:37

Am 31.12.2018 ist Dr. Klaus Billerbeck, ehemaliger Geschäftsführer des DIE, in Pullach verstorben. Er wurde 91 Jahre alt. Klaus Billerbeck gestaltete in den Gründungsjahren das Verhältnis des Institutes zum BMZ, seinem Hauptgesellschafter, und erarbeitete gemeinsam mit der Mitarbeiterschaft die Aufgabentrias von Forschung, Beratung und Ausbildung, die das Institut bis heute prägt. Wir gedenken seines Engagements für das DIE und trauern mit seiner Witwe und seiner Tochter.

Der Beitrag Zum Tod von Klaus Billerbeck erschien zuerst auf International Development Blog.

Nach dem Brexit – Was wird aus der europäischen Außen- und Entwicklungspolitik?

27. März 2019 - 14:26

Großbritannien ist einer der vier wichtigsten Akteure in der europäischen Entwicklungspolitik. Der Brexit wird daher merkliche Folgen für die Zukunft der globalen Rolle der EU haben. Unter diesem Vorzeichen fand am 27. Februar im Rahmen der Reiher Bonner Impulse eine Podiumsdiskussion zur Zukunft der Beziehungen zu Großbritannien in der Außen- und Entwicklungspolitik statt. Die Veranstaltungsreihe, die gemeinsam vom Deutschen Institut für Entwicklungspolitik (DIE), der European Association of Development Research and Training Institutes (EADI) und dem Verband Entwicklungspolitik und Humanitäre Hilfe deutscher Nichtregierungsorganisationen (VENRO) organisiert wird, lädt regemäßig Vertreterinnen und Vertreter aus Politik, Wissenschaft und Zivilgesellschaft zu Diskussionen über nachhaltige europäische Entwicklungspolitik ein. Rund 100 Gäste verfolgten an diesem Mittwochabend die Diskussion im Auditorium des Kunstmuseums Bonn.

Moderiert von EU-Expertin Christine Hackenesch, diskutierten der stellvertretende FDP-Bundestagsfraktionsvorsitzende Alexander Graf Lambsdorff, Pedro Morazán vom Südwind-Institut für Ökonomie und Ökumene und Stefani Weiss von der Bertelsmann Stiftung über die Austrittsverhandlungen sowie über gemeinsame Außeninteressen der EU und Großbritanniens. Dass der Brexit die Bonner Bürgerinnen und Bürger sichtlich beschäftigt, zeigten auch die zahlreichen Publikumsfragen und Kommentare zur politischen Motivation hinter dem Brexit und zu den realpolitischen Konsequenzen des EU-Austritts Großbritanniens. Für unsere Interview-Reihe „Perspectives On“ haben die Diskussionsteilnehmenden zusammengefasst, was sich nach dem Brexit für die europäische Außen- und Entwicklungspolitik ändert.

 

Der Beitrag Nach dem Brexit – Was wird aus der europäischen Außen- und Entwicklungspolitik? erschien zuerst auf International Development Blog.

Bürgerbeteiligung in Marokko: DIE und INAU beginnen Kooperation

27. März 2019 - 13:50

Nach den Aufständen im Jahr 2011 versprach die marokkanische Regierung mehr Bürgerbeteiligung – doch ermöglicht sie heute wirklich mehr Partizipation oder sind die Institutionen nur ‚kosmetische Reformen‘? Das DIE und das marokkanische Institut National de l’Aménagement et d’Urbanisme (INAU) haben jetzt ein Kooperationsabkommen unterzeichnet und erforschen in vier Städten, wie es um die Partizipation steht.

Wo und wie konnten Initiativen zur Bürgerbeteiligung wirklich Einfluss auf die Politikgestaltung nehmen? Was können marokkanische Entscheidungsträger und Akteure der Entwicklungszusammenarbeit daraus lernen? Und wie können die neuen Instanzen zur Förderung von Chancengleichheit und zur Einbeziehung der jungen Bevölkerung so gestaltet werden, dass sie bisher wenig berücksichtigte Gruppen tatsächlich einbeziehen? Diesen Fragen geht Annabelle Houdret vom DIE zusammen mit den marokkanischen Forscherinnen und Forschern in den Städten Chefchaouen, Larache, Agadir und Tiznit nach. Der Kick-off-Workshop fand am 21. Februar in Rabat statt und die Vorstellung der Ergebnisse ist für Anfang 2020 geplant.

Der Beitrag Bürgerbeteiligung in Marokko: DIE und INAU beginnen Kooperation erschien zuerst auf International Development Blog.

Workshop „Preferences, attitudes and environmental impacts of the new middle classes“

27. März 2019 - 11:14

Focus group discussion Ghana

Am 4. April findet der Workshop „Preferences, attitudes and environmental impacts of the new middle classes“ am DIE statt. Ziel des Workshops ist, effektive Kombination verschiedener Politiken zur Veränderung von Lebensstilen auf mehreren Ebenen und die spezielle Rolle verhaltenswissenschaftlicher Ansätze zu erarbeiten. Die Nachwuchsgruppe „Nachhaltige Mittelschichten in Ländern mittleren Einkommens: Transformation CO2-intensiver Konsummuster (SMMICC)“ präsentiert Ergebnisse zu Konsumtrends und ihren Hintergründen aus Haushaltsumfragen in Ghana, Peru und den Philippinen. Praxisbeispiele aus den Bereichen Energie, Transport und Recycling ergänzen die wissenschaftliche Perspektive.

Der Beitrag Workshop „Preferences, attitudes and environmental impacts of the new middle classes“ erschien zuerst auf International Development Blog.

Expert Roundtable: Investment Facilitation for Sustainable Development

27. März 2019 - 10:50

Der Roundtable “Investment Facilitation for Sustainable Development”, den das DIE am 19. März 2019 in Berlin organisiert hat, brachte hochrangige Expertinnen und Experten aus Regierungen, internationalen Organisationen und der Wissenschaft zusammen. Ziel war es Optionen zu diskutieren, wie die aktuellen Diskussionen über ein internationales Rahmenwerk für Investment Facilitation nachhaltige Entwicklung befördern kann. Investment Facilitation ist ein neues Thema auf der Agenda der Welthandelsorganisation (WTO) und es sind insbesondere Entwicklungs- und Schwellenländer, die diese Diskussionen vorantreiben. Investment Facilitation verfolgt das Ziel nationale Investitionssysteme transparenter, konsistenter und vorhersehbarer zu machen.

Zum Auftakt des Roundtables gab der kolumbianische WTO-Botschafter, der die sogenannten „Structured Discussions“ in der WTO leitet, einen Überblick über den Stand der Diskussionen. In den darauffolgenden Gesprächsrunden wurden sowohl Regeln als auch mögliche Unterstützungsmaßnahmen für Entwicklungsländer identifiziert, die den Beitrag eines möglichen internationalen Rahmenwerkes für Investment Facilitation zu nachhaltiger Entwicklung erhöhen können. Eine der wichtigen Schlussfolgerungen war, dass ein internationales Rahmenwerk so ausgestaltet werden muss, dass nationale Regulierungssysteme gestärkt werden, die von zentraler Bedeutung für die Förderung nachhaltiger Investitionen sind. Der Roundtable ist Teil eines aktuellen Arbeitsstrangs des DIE zu Investment Facilitation.

 

Der Beitrag Expert Roundtable: Investment Facilitation for Sustainable Development erschien zuerst auf International Development Blog.

Ein neuer Gesellschaftsvertrag für Marokko? DIE und GIZ diskutieren möglichen Beitrag der Entwicklungszusammenarbeit

27. März 2019 - 10:41

Zusammen mit dem Governance-Cluster der GIZ Marokko organisierte Annabelle Houdret (DIE) am 22. Februar 2019 einen Workshop in Rabat. Sie führte das vom DIE geprägte Konzept eines neuen Gesellschaftsvertrags ein und zeigte auf, wie dieses auch für die Entwicklungszusammenarbeit (EZ) als Analyse- und Planungsinstrument genutzt werden kann. Der marokkanische Ökonom Prof. Kamal ElMesbahi (Transparency Maroc), hob anschließend in seinem Vortrag die wesentlichen Governance-Probleme des Landes und mögliche Anknüpfungspunkte für die EZ hervor. Auf dieser Grundlage diskutierten die GIZ-Mitarbeiterinnen und Mitarbeiter dann, wie ihre Arbeit die marokkanische Gesellschaft und Regierung noch stärker darin unterstützen kann, einen neuen, inklusiveren Gesellschaftsvertrag auszuhandeln.

Das DIE erforscht seit 2015 im Regionalvorhaben ‚Entwicklung und Stabilisierung in Nahost und Nordafrika‘ das Konzept des Gesellschaftsvertrags und unterstützt das BMZ und die Durchführungsorganisationen darin, den Ansatz für die strategische Planung und Umsetzung zu nutzen.

Der Beitrag Ein neuer Gesellschaftsvertrag für Marokko? DIE und GIZ diskutieren möglichen Beitrag der Entwicklungszusammenarbeit erschien zuerst auf International Development Blog.

Anhörung zur zukünftigen Handels- und Investitionspolitik Großbritanniens

27. März 2019 - 9:51

Axel Berger

Am 27. Februar 2019 hat Axel Berger an einer Anhörung des Britischen Parlaments zur zukünftigen britischen Handels- und Investitionspolitik teilgenommen. Nach dem Austritt aus der Europäischen Union wird Großbritannien in der Lage sein, eigene Handels- und Investitionsabkommen abzuschließen. In der Anhörung hat Axel Berger auf Basis seiner Forschung die Vor- und Nachteile der Integration von Marktöffnungsklauseln in Handels- und Investitionsabkommen vorgestellt. Zudem empfahl er, dass Großbritannien eine aktive Rolle in den Diskussionen in der Welthandelsorganisation zu Investment Facilitation einnimmt. Diese Diskussionen werden insbesondere von Entwicklungs- und Schwellenländern vorangetrieben und zielen darauf ab, nationale Investitionsregeln transparenter, konsistenter und vorhersehbarer zu machen. Ein internationales Rahmenwerk für Investment Facilitation hat das Potential Investitionsflüsse in Entwicklungsländer zu fördern.

 

Der Beitrag Anhörung zur zukünftigen Handels- und Investitionspolitik Großbritanniens erschien zuerst auf International Development Blog.

Expertenkonferenz zur Rolle der G20 in der Klima- und Nachhaltigkeitspolitik

25. März 2019 - 15:46

Am 20. März 2019 diskutierten in Berlin rund 60 Expertinnen und Experten aus Politik und Wissenschaft, wie die Rolle der G20 als Unterstützer einer ambitionierten Klima- und Nachhaltigkeitspolitik gestärkt werden kann. Die Expertenkonferenz “Fit for purpose? Revitalizing climate and sustainability issues in the G20 process” wurde vom DIE zusammen mit dem Institute for Global Environmental Strategies (IGES, Tokio), dem Mercator Research Institute on Global Commons and Climate Change (MCC, Berlin) und dem Sustainable Development Solutions Network (SDSN) organisiert. Die Konferenz war Teil des T20-Prozesses während der japanischen G20-Präsidentschaft und bot eine Plattform für den vertrauensvollen Austausch zwischen Vertreterinnen und Vertreter unterschiedlicher Arbeitsstränge der G20 und den Task Forces der T20.

Die G20 hat in den vergangenen Jahren bei einzelnen Gelegenheiten gezeigt, dass sie multilaterale Nachhaltigkeits- und Klimapolitik stärken kann. Dies wurde zum Beispiel in der Vorbereitung des Pariser Klimaabkommens 2015 deutlich oder in der Verabschiedung des G20 Action Plan on the 2030 Agenda for Sustainable Development während der chinesischen G20-Präsidentschaft 2016. Vor dem Hintergrund aktueller politischer Blockaden sollte, so die Einschätzung der Expertinnen und Experten, der Schwerpunkt auf konkrete Initiativen gelegt werden, durch die sowohl die Nachhaltigkeits- als auch Klimaagenda vorangetrieben werden kann. Nachhaltige Infrastruktur sei ein aktuelles Beispiel, das auch hoch auf der Agenda der japanischen G20-Präsidentschaft steht. Auch die Rolle von nicht-staatlichen Akteuren wurde hervorgehoben. Die Teilnehmenden der Konferenz betonten die Rolle der T20 nicht nur als Ideengeber der G20, sondern auch als Prüfungsinstanz bei der kontinuierlichen Umsetzung von G20-Beschlüssen. Damit die T20 diese Rolle ausfüllen kann, müsse sie ihre eigenen Arbeitsstrukturen überdenken und weiter verstetigen. Es gab breite Unterstützung, in den nächsten Jahren regelmäßig in diesem Format zu einer Task-Force-übergreifenden Fachkonferenz zusammenzukommen.

Der Beitrag Expertenkonferenz zur Rolle der G20 in der Klima- und Nachhaltigkeitspolitik erschien zuerst auf International Development Blog.

Sustainable Development Solutions Network (SDSN) Germany

25. März 2019 - 14:54

Veranstalungsreihe Neuer Aufbruch für Europa, v.l. Adolf Kloke-Lesch, Marietta Müller, Gesine Schwan, Katarina Barley, Niklas Im Winkel, Janina Sturm

Am 11. Februar fand die 9. Sitzung des Erweiterten Lenkungsausschusses von SDSN Germany im Wissenschaftszentrum Berlin für Sozialforschung statt. Das Thema der Sitzung war „Nachhaltigkeit in Zeiten des Populismus – Antwort oder Opfer?“. Zusammen mit den Mitgliedern des Erweiterten Lenkungsausschusses und zahlreichen Gästen, unter ihnen Nina Scheer (Stellvertretende Vorsitzende des PBNE), Johannes Dimroth (Presse- und Informationsamtes der Bundesregierung), Edgar Grande (Zentrum für Zivilgesellschaftsforschung am Wissenschaftszentrum Berlin für Sozialforschung) und Hanna Schwander (Hertie School of Governance) fand eine breite Diskussion zu diesem hochaktuellen Thema statt. In den nächsten Monaten ist zu der Thematik außerdem ein Fach-Workshop geplant, organisiert von Adelphi, Engagement Global, Germanwatch und SDSN Germany.

Neue Chancen für Wachstum und Globalisierung – Nachhaltigkeit als europäisches Zukunftsprojekt?“ lautete das Thema der Veranstaltung am 18. Februar in Berlin, für die  Katarina Barley, Spitzenkandidatin der SPD für die Europawahl, gewonnen wurde, sowie zahlreiche weitere hochrangige Vertreterinnen und Vertreter aus Wissenschaft, Wirtschaft und Zivilgesellschaft. Die Veranstaltung bildete den Auftakt für eine gemeinsame Reihe von SDSN Germany, der Humboldt-Viadrina Governance Platform (HVGP) und der Stiftung Wissenschaft und Politik (SWP) unter dem Titel „Neuer Aufbruch für Europa – die SDGs als Chance und Herausforderung für deutsche Politik in Europa“. Die zweite Veranstaltung dieser Reihe stellte am 7. März in Berlin „Nachhaltigkeit als Formel für soziale Gerechtigkeit und inneren Zusammenhalt in Europa“ in den Mittelpunkt, mit Keynotes von Rita Schwarzelühr-Sutter (Parlamentarische Staatssekretärin, BMU) und Svenja Hahn (Spitzenkandidatin der Jungen Liberalen / FDP für die Europawahl).  Auch dieses Thema stieß auf große Resonanz bei den Teilnehmenden aus unterschiedlichsten gesellschaftlichen und politischen Milieus. Im Laufe des Jahres sind weitere Veranstaltungen und Publikationen in dieser Reihe geplant, um diesen Austausch auch im Nachgang zu den Europawahlen fortzuführen.

Zum ersten Mal trafen sich die europäischen SDSN-Netzwerke am 11. und 12. März in Paris, um gemeinsame Wege zu finden, die Umsetzung der SDGs auf europäischer Ebene und in den Mitgliedsstaaten zu unterstützen.

Die Geschäftsstelle von SDSN Germany hat mit einem Auftakttermin am Wuppertal Institut begonnen, ihre Mitglieder und Partner im Format einer ‚#SDSN_Deutschlandreise‘ zu besuchen, um den Austausch im Netzwerk zu fördern und weitere Kooperationsmöglichkeiten zu erschließen.

Der Beitrag Sustainable Development Solutions Network (SDSN) Germany erschien zuerst auf International Development Blog.

Klimalog geht weiter

25. März 2019 - 13:23

vlnr.: Mariya Aleksandrova, Alexander Knabe, Okka Lou Mathis, Gabriela Iacobuta, Carmen Richerzhagen, Steffen Bauer, Jean Carlo Rodríguez de Francisco

Das 2015 initiierte Projekt „Klimalog-Forschung und Dialog für eine klimagerechte Transformation“ ging im Januar in eine zweite Phase. In den kommenden Jahren werden v.a. folgende Schwerpunkte untersucht: (1) die Umsetzungsherausforderungen von Klimapolitik in Entwicklungs- und Schwellenländern und die Steigerung entsprechender Ambitionen, (2) die Resilienz vulnerabler Bevölkerungsgruppen gegenüber Klimarisiken, speziell in armen Entwicklungsländern, (3) die Verzahnung von Klima- und Biodiversitätspolitik sowohl hinsichtlich der Emissionsminderung als auch der Anpassung an den Klimawandel sowie (4) die Bedeutung nicht-staatlicher und subnationaler Akteure in der globalen Klimapolitik. Unter der Leitung von Steffen Bauer werden die vier Schwerpunktthemen von einem internationalen und interdisziplinären Team aus sieben Wissenschaftlerinnen und Wissenschaftlern des DIE bearbeitet. Auch in der neuen Phase wird das Projektteam fortlaufend die internationalen Klimaverhandlungen begleiten. Neben der empirischen Forschung stehen dabei weiterhin die Vermittlung wissenschaftlicher Erkenntnisse sowie der lösungsorientierte Austausch zwischen Wissenschaft, Politik und Praxis im Rahmen von Dialogveranstaltungen im Fokus. Das Bundesministerium für wirtschaftliche Zusammenarbeit und Entwicklung (BMZ) fördert das Forschungs- und Beratungsprojekt für drei Jahre bis Ende 2021.

Weitere Informationen zum Klimalog finden Sie hier: www.klimalog.info

 

Der Beitrag Klimalog geht weiter erschien zuerst auf International Development Blog.

Central Banks and the G20 Agenda. Ensuring Policy Coherence

20. März 2019 - 10:43

The G20 has come a long way in pulling economies back from the brink. Yet, a lot remains to be done in its pursuit of inclusive and sustainable growth. Productivity growth is sluggish, unemployment remains well above pre-crisis levels, inequality is hitting record highs, and environmental risks pose threats worldwide.

Against this background, the pledge by G20 leaders to use all policy levers in targeting their goals is as important as ever. Central banks are already sitting at the G20 table and should not be carved out from this imperative. Consistent with their mandates and acknowledging their essential role in safeguarding price and financial stability the core G20 objectives must move onto their own radar screens. The urgent need highlighted in the joint declaration by G20 leaders in Buenos Aires to address distributional challenges, foster financial inclusion, close infrastructure financing gaps, and protect the environment should top their list.

Advancing G20 objectives

Central banks have already taken important steps in this direction and trailblazed initial pathways. Many have started evaluating the impact of their policies on inequality. References to the distributional effects of monetary operations by e.g. the President of the Minneapolis Fed, the Senior Deputy Governor of the Bank of Canada and the Deputy Governor of the Swedish central bank are examples. Studies of the distributive consequences of monetary easing by staff from the Bank of England, the Bank of Japan and the European Central Bank provide further illustration. Statements, such as the one from Jerome Powell, the Governor of the Federal Reserve, who recently referred to inequality as one of the biggest challenges for the US in the coming decade, also signal growing concerns.

Some central banks have deepened their engagement on financial inclusion and thus to support access to affordable financial services for households as well as small and medium-sized enterprises (SMEs). To that end the Reserve Bank of India relaxed regulatory requirements to open bank accounts. The Bank of England provided incentives for SME lending through its Funding for Lending Scheme. The People’s Bank of China reduced reserve ratios for credit to small and micro enterprises. The Fed, among many other central banks, is exploring pathways that seize the potential of digital services for financial inclusion and at the same time ensure consumer and data protection. And the Banque de France committed to ensure strict compliance by French banks with their December 2018 promise to cap bank charges at 25 Euro a month for 3.5 million vulnerable customers.

Other central banks have strengthened their role in supporting capital flows to infrastructure. Bank Indonesia has coordinated with the Indonesian Government, the country’s Financial Services Authority and other financial institutions to develop new instruments for infrastructure funding. The Hong Kong Monetary Authority set up the Infrastructure Financing Facilitation Office to expand infrastructure investment and started investing into infrastructure itself through the Long-Term Growth Portfolio of its Exchange Fund. The integration of a “physical and human capital” filter into the equity purchases by the Bank of Japan offers a further case in point.

Moreover, and crucially, 30 central banks and financial supervisors are now members of the NGFS, the “Central Banks and Supervisors Network for Greening the Financial System”, to mobilize finance for the transition to a sustainable economy. With their first progress report, NGFS members highlighted that environmental risks are a source of financial risk and that it is within their mandates to ensure the financial system is resilient to these risks. They also warned that such environmental risks are not sufficiently accounted for in financial markets and called for central banks to “lead by example” and to reflect environmental risks in their activities.

Many central banks and supervisors have already started moving towards this goal. The People’s Bank of China included green bonds with an AA rating and high-quality green loans as collateral into its medium-term loan facility. The central banks of Finland, France and the Netherlands, among others, have initiated the integration of environmental, social and governance criteria into the management of their non-monetary policy portfolios. The Eurosystem is reviewing its risk management processes to ensure “that all the relevant factors, including environmental ones, for the prudent management of the portfolio held by the central banks are being taken into account”. And the BoE started consultations on a supervisory statement that sets out its expectations on how the financial sector should manage the financial risks from climate change.

Expanding and accelerating momentum

Expanding and accelerating this momentum is critical. Central banks play a vital role for sustainable prosperity. With price and financial stability at the core of their mandates they provide key pillars for macroeconomic development. As lenders of last resort and prudential supervisors they fulfill fundamental tasks for functioning financial markets. And with oversight of payment as well as clearing and settlement systems they are essential for modern economies.

The instruments at their disposal to target their objectives have significant repercussions on a broad range of policy goals – including core elements of the G20 agenda. The distributional impact of monetary policy, the effects of financial supervision on financial inclusion and infrastructure investing, as well as the environmental risks inherent to central banks’ asset purchases and collateral frameworks are cases in point.

Understanding these linkages and ensuring alignment between central bank policies and the broader goal of inclusive and sustainable growth is essential. Many central banks have already made important steps in this direction. G20 leaders should endorse the momentum they have built. They should also encourage them and their peers to move further in assessing, reporting and engaging on the broader effects of their policies and thus to ensure policy coherence with the G20 agenda.

This blog is a synopsis of a forthcoming T20 policy brief that will be made available at www.t20japan.org/publications/policy-briefs

Der Beitrag Central Banks and the G20 Agenda. Ensuring Policy Coherence erschien zuerst auf International Development Blog.

How to frame South-–South Cooperation? Challenges of the upcoming 2nd UN Conference on South-South Cooperation

19. März 2019 - 13:03

In 2015, world leaders set up the most ambitious agendas: the 2030 Agenda and the Paris agreement on climate change. These agendas included commitments to eradicate hunger, and to fight poverty and inequality, leaving no one behind. They also included voluntary obligations to reduce emissions and to adopt serious measures for mitigating and promoting adaptation to the impact of climate change.

These agendas were negotiated through a bottom-up approach that reflected a new distribution of power and an emerging “multiplex World Order” (Amitav Acharya) in which key actors interact in different ways. Nonetheless, one year after the establishment of these agreements the world was shaken by a wave of nationalist movements, from east to west, from north to south. Since 2016, multilateral institutions and the goals they were supposed to promote have been under siege.

These attacks affect the ability of governments to fulfil their commitments to the implementation of such agendas, and therefore have an impact on the development cooperation field. Development cooperation is a sensitive field in the face of the challenges of a transforming world order. There is no universal approach, with the area basically divided into two major sub-systems. First, the ODA (Official Development Assistance) system, led by the OECD and organised according to a division between donors and recipients, where the former has the responsibility for providing development aid to the latter. Second, a heterogeneous set of practices led by rising (super)powers identified under the South–South Cooperation (SSC) umbrella.

Intertwined approaches

Neither group nor development approach is entirely fixed or stable. On the contrary, development cooperation is a decentralized policy area in which different principles and practices are increasingly intertwined. For example, the Development Assistance Committee (DAC) of the OECD includes the Republic of Korea – a country formerly of the Global South. Additionally, many South–South Cooperation Partners are still recipients of ODA, crossing the lines between these subsystems. Others are currently facing the challenge of having graduated from the recipient list without necessarily overcoming their own development bottlenecks.

Different understandings of development cooperation are contested in international development debates, hindering attempts to merge these sub-systems. The Global Partnership for Effective Development Cooperation (GPEDC) is one example of such difficulties. The GPEDC is intended to be the main platform for actors on aid-effectiveness topics, but it is not a global platform since major actors such as Brazil, China and India are not participants.

SSC is organized and defined to a limited extent. The IBSA (India, Brazil and South Africa) club provided a definition of SSC in mid-2018. While emphasizing the principles of “respect for national sovereignty; national ownership and independence; equality; non-conditionality; non-interference in domestic affairs; and mutual benefit”, IBSA partners claim that “SSC is completely different from the North–South/donor–donee cooperation, and that ODA templates are not a good basis for SSC”. Nevertheless, a clearly defined group of SSC providers and a jointly shared approach are not yet available. For example, Rwanda’s capacity-building support for the government of Benin is quite outside the current mainstream discourse of SCC providers coming from middle-income countries.

Framing the agenda for BAPA+40

Based on the “Buenos Aires Plan of Action for Promoting and Implementing Technical Cooperation among Developing Countries” adopted in 1978, the Second High-Level United Nations Conference on South-South Cooperation (this new Buenos Aires Plan of Action conference is abbreviated as BAPA+40) will take place from 20 to 22 March 2019 in Buenos Aires. BAPA+40 will be the main event on SSC and triangular cooperation for many years; the event itself, as well as the preparation for it, will focus debates in several ways.

First, the fact that BAPA+40 will be a multilateral conference under the auspices of the United Nations, will afford it much legitimacy in dealing with SSC. Jointly agreed norms and standards will be a major improvement on the often confusing debates about SSC. The conference is the ideal place to broaden a consensus on a definition of SSC among SSC providers, and between SSC providers and beneficiaries. Thus, BAPA+40 could and should be the place to decide on a clear definition of SSC.

Second, as a UN Conference, BAPA+40 is the most suitable venue to revisit the issue of international responsibility. As the lines between North and South have blurred, international responsibility has become indistinct. While the BAPA+40 should emphasize the unique responsibility of developed countries (such as the 0.7% ODA to GNI commitment), it should also tackle the issue of differentiation. The conference will be an opportunity to advance the principle of concentric differentiation, based on voluntary commitments, also known as CBDR (common but differentiated responsibilities) 2.0.

Third, the BAPA+40 preparation process is a good opportunity to systematize existing impact assessment practices among South–South Cooperation Partners and reach a broader agreement about common criteria for assessing SSC.

Fourth, as the BAPA+40 Conference will gather together SSC providers and DAC donors , it should move beyond existing models of triangular cooperation – which often stress the influence on emerging powers – towards a horizontal partnership driven by developmental goals, oriented towards knowledge sharing under the “Leaving No One Behind” approach. Triangular cooperation has the potential to use multi-stakeholder approaches beyond the traditional models. In this particular case, experiences such as the Global Partnership Initiative on Effective Triangular Cooperation should be strengthened and emulated.

Dialogues on global problem-solving are important. The 2030 Agenda and its Sustainable Development Goals (SDGs) require effective partnerships. A global set of norms for development cooperation so far does not exist; BAPA+40 is a crucial opportunity to identify common ground for an emerging consensus on SSC.

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The disputed status of developing countries in the WTO

14. März 2019 - 13:03

File source: http://commons.wikimedia.org/wiki/File:Geneva_Ministerial_Conference_18-20_May_1998_(9305956531).jpg

Currently, the US and China are fiercely discussing about the role of developing countries in the World Trade Organization (WTO). At the heart of the discussion is the question whether rising powers like China should benefit from special rights in the WTO.

This is one key dimension of a broader ongoing debate about the future of the WTO. Finding a compromise on the disputed status of developing countries and, more generally, reforming the WTO will be essential to safeguard the multilateral trading system.

Special and Differential Treatment – a key issue for the future of the WTO

While the role of developing countries is thus a central issue worthy of debate, the current dispute, presently with no signs of flexibility to negotiate on either side, seems too confrontational to provide a promising basis for WTO reform. Looking ahead, we need an inclusive deliberation process to seek a possible middle ground. In this blog post, we lay out the current state of the debate and sketch some ideas for a possible way forward, both in terms of process and in terms of content.
WTO rules imply that developing countries receive “special and differential treatment”, for instance, longer time periods for implementing WTO commitments or exemptions from certain obligations. At the same time, the WTO rules do not define “developing countries.” There are thus no criteria in the WTO that determine whether a member state is a “developing” country or not. Instead, developing countries in the WTO are designated on the basis of self-selection – independent of whether they are rich or poor, big or small. It is argued by some members that this “self-designation” approach has been a central reason for the lack of progress in the Doha Round negotiations and represents an immense challenge for negotiating new agreements in the WTO.
For example, China still sticks to its status a “developing country” in the WTO even though it is the world’s largest exporter of goods and its average income per capita increased to almost $9,000 in 2017 (from $1000 in 2001). The case of China is particularly controversial: According to Dennis Shea, the US ambassador to the WTO, there is “nothing special or differential when a member that has landed a rover on the dark side of the moon … insists on the same treatment as one of our poorest members.”

Who should receive special treatment?

The US administration recently suggested to introduce some, potentially overlapping, objective criteria for “developing countries” in the WTO. According to the draft decision proposed by the US, it should be made impossible to hold on to this status if the country in question is a member of the Organization for Economic Cooperation and Development (OECD) or the Group of 20 (G20), a high-income country, or accounts for at least 0.5 percent of global merchandise trade. Zhang Xiangchen, the Chinese Ambassador replied to the US proposal, rejecting it on several grounds, including the argument that the US has arbitrarily selected the suggested standards. China also signed a critical joint communique together with India, South Africa and other like-minded members in the WTO, arguing that self-designation is the best approach for addressing massive inequalities in economic development across WTO members.
While the suggested criteria of the US proposal might – despite the controversy they have stirred – provide a basis for a future compromise, the currently ongoing debate is unlikely to generate common ground. This is especially the case given that the reform proposal has been made by the US. The Trump administration has been strongly attacking the WTO without showing flexibility to negotiate with its counterparts about how to improve the functioning of the organization. In particular, with respect to solving the Appellate Body crisis, the EU, Canada and many other countries have made concrete reform proposals, but the US has not yet shown any willingness to sit down to discuss these proposals, which thereby undermine US’ credibility in reforming the WTO. Rather than the current confrontational dispute dominated by the US and China, we need a more inclusive and more nuanced discussion.
In terms of process, the current debate on the US proposal is only promising if the US manages to form a consensus with other member states like the EU and Japan. Only then can the proposal be the ground for a much-needed reflection. If emerging economies like China, India and South Africa are interested in saving the negotiation function of the WTO, they should consider being more open to a compromise. The G20 would hence also be a suitable forum to further ponder special and differential treatment as well as other aspects of WTO reform.

A possible middle ground

In terms of content, future deliberations should seek a middle ground. One way forward might be to refine the proposed criteria. For instance, the criteria should also take account of the share of people living in poverty in the country under consideration. While India, for example, is part of the G20 and accounts for a substantial share of global merchandise trade, around 30 percent in the low middle-income country live in poverty – and India might thus be regarded as justifiably arguing that it still deserves special and differential treatment.
As recently observed by former WTO staff, since it would be “impractical to try to negotiate the development status of countries,” special and differential treatment should be based on specific individual country needs, for instance at the sectoral level. The point of any special and differential treatment reform should be to engage members more fully in the system rather than exempting certain groups of members. A potentially complementary approach would be to base special and differential treatment on the capabilities of specific members to contribute to liberalization. For instance, a sector-based competitiveness index could determine the status of a country in the negotiations for a new agreement in that sector, for example in e-commerce, agriculture, services, and manufacturing goods. The Trade Facilitation Agreement has provided a useful example of such an approach by breaking developing members into various groups who are offered different timeframes to implement the terms of the agreement.
To cut to the chase, it is time to question the conventional binary distinction between developed and developing countries in the WTO. However, for developing countries, negotiating the development status of WTO members seems to be a non-starter. There is thus a need for a new approach with more fine-grained case-by-case options to reform special and differential treatment in the WTO – either based on specific countries’ needs for assistance or their capabilities to contribute, or both. European member states should join this discussion more actively and provide a bridge among the US, China, and other WTO members in order to promote a more robust and inclusive multilateral trading system.

Der Beitrag The disputed status of developing countries in the WTO erschien zuerst auf International Development Blog.

Trust in the Internet: The Economic Dimension of Cybersecurity

28. Februar 2019 - 10:23

Cybersecurity was a prime topic at this year’s Munich Security Conference. If, for instance, the cloud service provider AWS with its 42% market share was successfully attacked, it would take down large parts of the Internet, with impacts worse than kinetic warfare by some measures.

Overall economic losses from cyberattacks are estimated at 600bn $, or 1% of global GDP, with sharp growth rates as all parts of the economy are moving online. Still, these figures reflect just the tip of the iceberg. Many potentials for digital value creation cannot be realized due to lack of trust. Germans, for instance, feel queasy about online banking: Only half of Germans trust the security of digital transactions, stifling uptake of new fintech business models.

Cybersecurity, unlike conventional warfare, is all about mitigating vulnerabilities. Every line of code in a software program, and every new device connected to the Internet, could potentially harbor an entry point for attackers. The complexity of today’s IT systems requires significant additional efforts to be secured, while only few companies show the willingness for additional investments.

The market fails to secure the Internet

Consumer choices, unfortunately, hardly ever reward responsible companies for their efforts of developing secure products. This is exacerbated with the advent of the Internet of Things (IoT). Take for example a customer of a new smart TV. He or she will typically be concerned about screen size, new interactive functions, and price bargains, with little room to consider IT security. Consequently, there have been various successful attacks to smart TVs, turning them into remote controlled domestic surveillance devices. Besides being able to peek into other people’s kitchens, living rooms and bedrooms, those hacked TVs have become part of a global network of so-called „bot nets“, remote controlled armies of Internet-connected devices, that can be used to run a distributed attack flooding their target with huge amounts of data packets, so-called “DDOS” attacks, temporarily taking their victims offline.

This example illustrates why cybersecurity is a global challenge. The owner of a smart TV may not even notice that their device is being used for attacks that cause harm elsewhere on the globe. The congestion of DDOS-attacks can be so severe to sometimes cut off entire countries like Liberia from the Internet.

Where markets fail to keep the Internet reasonably secure, governmental intervention seems justified. The challenge here is to incentivize investment in secure IT, while avoiding regulations that stifle innovation. Consumer information, such as a label certifying IT security attached to an IoT-Device, can be one element; German cyber authority Bundesamt für Sicherheit in der Informationstechnik (BSI) introduced an auditing standard to certify a basic cybersecurity standard of Internet routers. Yet other approaches aim to shift legal responsibility away from the consumer and towards producers. Such shifts in product liability need a good sense of proportion, as too much product liability would eventually lead IT companies to hire many lawyers and fewer software developers, and correspondingly slowing down the pace of innovation.

Instead, I would like to suggest a market-oriented and innovation-friendly approaches towards addressing the market failure of cybersecurity. Some companies are role models for creating a secure and trustable digital world. They adopt methods of security by design in their products, and even hire external hackers to test for and report security flaws. San Francisco-based company HackerOne is leading the market in “bug bounties”. These are external security audits in the form of open competitions. If you find a serious bug inside Apple’s iOS Operating System, for example, you can expect a reward, or bounty, of up to 200,000 US Dollar for reporting the security flaw.

The black market however pays better. The controversial marketplace Zerodium offers up to 1.5 million US Dollar for the same bug. This leaves IT security experts in a moral and financial conundrum. While white hat hacker groups like the Chaos Computer Club (CCC) work hard to keep moral standards high, some security experts are tempted by the lure of money, and sell vulnerabilities on the profitable black market instead. As vulnerabilities on the black market tend to end up in the hands of criminal organizations and governmental spies instead of getting fixed, this market force further deteriorates trust and security on the Internet.

The way forward

The only way to keep the Internet secure and trustable in the long run is to pull enough IT security experts to use their expertise for securing the Internet rather than undermining security. This is determined mainly by four forces: Education, moral grounds, private sector spending and governmental spending on IT security.

Unfortunately, the latter one, governmental spending, does not automatically lead to a more secure Internet, as many of the discovered vulnerabilities are left open, in order to be used as espionage tools or even weapons. Can we imagine governments committing equal amounts of funding towards securing vulnerabilities as they are spending towards vulnerabilities left open? Free and Open Software Auditing (FOSSA), a EU-funded initiative, is a good example how governments can allocate funds towards more trust and security on the Internet.

Regarding the private sector, can we imagine that bug bounties, such as those carried out by organizations like HackerOne, covered not just a few IT products, but in fact all commercial software, by legal obligation? The bounty would be paid from a fund that the manufacturer would be obliged to pay in accordance with the seriousness of the vulnerability, and in proportion to the revenues generated by the product. Compared to far-reaching legal liabilities, such a bounty may be a cost-efficient and path towards more private sector investment in a secure Internet. As a borderless solution on a global network, we can imagine this fund being managed on a Blockchain solution like Hackenproof, and paying out anonymously to whoever submits a vulnerability.

At the same time, we must not underestimate the pulling forces of good moral standards within white hat hacker communities working towards securing the Internet. Governments should welcome these efforts, and protect benevolent hacking from legal persecution, and adopt responsible disclosure policies that encourage reporting of vulnerabilities.

Lastly, education is a key enabler. This includes computer science, electrical engineering, as well as programming courses, complemented with more specific IT security online training, and most importantly, curiosity and hands-on experience with a computer connected to the Internet.

Der Beitrag Trust in the Internet: The Economic Dimension of Cybersecurity erschien zuerst auf International Development Blog.

Can we understand the prospects of development without understanding its environmental dimension?

13. Februar 2019 - 12:48

Development studies aim to understand the root causes of poverty and its reproduction and how social inequalities emerge and are stabilized. This is a broad endeavour with a number of academic disciplines contributing, with quite a few success stories if we look at the economic and the social dimensions. However, while maintaining the focus on human wellbeing, we ought to change the mainstream understanding of this task and need to include the natural environment and its threats in the research on development.

In mainstream development studies, economists focus on economic structures and incentives that keep productivity and growth rates low, and at factors that make it difficult for developing countries to establish sectors with a higher valued added, either by integrating themselves in global value chains or into regional markets. They may also look at labour markets and at social policies in the broadest sense and their (in-)effectiveness in reducing poverty and inequality. Political scientists, for their part, are concerned with institutions and governance relations for similar reasons while other social scientists want to understand the social categories and processes that originate discrimination of specific groups of people and thus impact on their political and economic participation – understanding societal power relations is important to them.

How does the environment come into this line of research? The disciplines established subdisciplines that specialise on the environment. Some examples: economists look at efficiency in natural resource use and at the most effective policy instruments for decarbonizing production and consumption. Political scientists are interested in the negotiation dynamics of multilateral environmental agreements and institutions that facilitate their implementation, and in the factors that promote or hinder environmental policies and their implementation at national and local levels. Sociologists, in turn, analyse the distributive effects of environmental policies, be they global or national, or linked to external interventions by conservationists or development cooperation.

The mainstream perspective needs to shift

This specialization was helpful, but did not change the mainstream of development studies. Most research on poverty and social inequalities – be it in the North or in the South – ignores the environmental dimension of changes in human development. This is dangerous. The cumulative environmental impacts of human activity since the industrial revolution are likely to make the earth uninhabitable for the human species within this century if business as usual continues

Global warming due to high levels of greenhouse gas emissions reduces agricultural productivity in most regions of the world and increases water stress; increased frequency and intensity of extreme weather events may have disruptive effects on infrastructures and stability of supply with food and energy. Global warming alone may thus lead to radical destabilization of societies that increasingly face situations of stress.

Adaptation to global warming is made more difficult by other environmental stressors such as decreasing availability of sufficient water in good quality; decreasing soil fertility; increasing loss of biodiversity; rising levels of pollution in the oceans (which also are increasingly acid due to rising absorption of CO2 from the atmosphere).

Development successes – and resulting challenges

In the last 20 years, the world has seen incredible rates of poverty reduction and of rising incomes for large shares of populations in Asia, and also in Latin America (less in Africa). This is what development studies and policies are about. At the same time, however, we have seen that the unmitigated environmental impacts that go along with the growth of production and consumption have added to the threats for global and local ecosystems and their vital functions.

Social environmental research has shown that those affected by socio-economic and political exclusion are generally more vulnerable to the effects of environmental pollution and change. We are facing a world where the advances in poverty reduction may fall victim to disastrous environmental change. As Dipesh Chakrabarty wrote the future of humanity as a species is in danger, and this is a threat that forces social science to also consider dynamics beyond power differentials between social classes, and between rich and poor countries.

Avoiding this scenario requires a drastic reduction of the environmental damage associated with human prosperity in high and middle-income countries, and prospectively also in poor countries where “catching-up” development based on conventional technologies cannot be relied on anymore. Strategies to address poverty and inequalities cannot ignore the sustainability of ecosystems and natural resources. At the same time, strategies for protecting the environment and the global commons cannot ignore the needs of poor people and countries.

Future strategies

Future strategies for ensuring human prosperity at global level will thus require considerable investment in research that improves understanding of the social practices, rules and institutions, and power relations that define human use of nature and the dynamics of its transformation (and this research in itself is subject to power relations). Social environmental research offers insights that are crucial for development studies in the 21st century – if we manage to understand development as being part of a transformation process that decarbonizes production and consumption, and that invests in the protection of ecosystems and nature-based solutions.

Three areas can be emphasised where research and teaching are needed but certainly there are more:

Transformation pathways and transformation governance (such as the work of Julia Leininger and Ines Dombrowsky with colleagues from “The World in 2050”), international cooperation for global sustainable development, and inter- and transdisciplinary research questions and methods.

This post is also published on www.developmentresearch.eu, the blog run by the European Association of Development Research and Training Institutes, EADI

 

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Global Innovation System Design: The G20 as a knowledge catalyst

31. Januar 2019 - 14:00

The evolutionary approach highlights education and innovation as a central means of welfare and growth. The transformation of the productive sphere and the development of society are depended upon knowledge generation and learning. An effective innovation system, which enhances knowledge generation and learning through increasing the interaction among the actors, provides a favorable environment in this regard. That is valid at the global level as well.

A global innovation system (GIS), which we define as a globally governed network of collaborative relations between different actors in updating knowledge base, may promote the generation and diffusion of relevant knowledge to enhance welfare and growth at the global level. In this way, we could systematically develop solutions for the existing and emerging global challenges from climate change to global inequality.

We argue that creating a GIS is possible via the transformation of the existing socio-technical system. In this, the G20 countries are argued to be the most fitted actors to design and govern a GIS not just because of their economic and social influence but also of their scientific and technological competence. We also identified three starting intermingled postulates for the design of GIS, namely openness, bottom-up decision-making mechanism, and consensus-building approach.

Knowledge: a global common good?

First of all, an attempt to create a GIS necessitates a new design of global knowledge pipelines and local buzz in a more densely manner via policy intervention at the global level. The knowledge flows among countries through all kinds of channels (such as scientific publications and patents, scientific and technological partnerships, mobility in higher education, and international trade) needs to be promoted. The G20 appears as the most fitted actor in that purpose since both scientific and technological activities and international trade and cross-border investments around the world are mainly driven and realized by G20 countries.

However, data shows that trade and foreign direct investment (FDI) largely remain as intra-group transactions. That applies to scientific and technologic activities, too. Both academic and industrial knowledge generated by G20 economies mainly circulate within the group. A well-functioned and successful innovation system, which promotes the diffusion of knowledge (particularly from developed economies to less developed ones), is only possible with openness, that makes an ever-increasing update of the knowledge base possible.

Governance of a GIS

For the second and third postulates, the European Union’s (EU) efforts through its framework programmes for research and innovation set a good case. The framework programmes aim to help “tackling societal challenges” through enhancing collaboration and cooperation, in addition to its emphasis on “excellent science and industrial leadership”. The proposed design of the next research and innovation framework programme (Horizon Europe), which pursues a mission-oriented policy approach, may make the pavement for organizing a collaborative effort for innovation policies to mitigate global challenges. Due to its members’ socio-economic influence and scientific and technological competence, the G20 can be a suitable catalyst for designing such a collaborative framework at the global level.

An effective GIS should include actors from other countries including LDCs and connect them to the global knowledge and innovation pipelines, in addition to those in G20 economies. The governance mechanism should also be inclusive and based on a bottom-up approach. The United Nations’ (UN) agencies and affiliated organizations (such as Technology Bank for LDCs) may facilitate the interaction between the G20 and other economies. That would also help in prioritizing the challenges and building consensus on policy tools through linking GIS with Sustainable Development Goals.

The Creation of GIS

Interaction within GIS will enhance the innovative performance of the actors and increase the welfare of humanity. The challenge here is to create a governance mechanism to increase the supply of global public goods. Such a governance structure would construct a more level playing field for all involved actors and could also be used to mitigate trade disputes and reduce overcapacities while speeding up policy learning and transition dynamics in various parts of the world by G20 labeled as innovation elites.

The promotion of GIS needs a more systemic approach. The major problem in this process is the existence of complex spaces in which global innovation networks and national systems are complicated to govern. The EU’s experience may provide valuable insights into the creation of GIS. The global attempt to construct a GIS can be shaped through the seven pillars of the Global Innovation Index: institutions, human capital and research, infrastructure, market sophistication, business sophistication, knowledge and technology outputs, and creative outputs.

Establishing a fund to support studies of GIS is the first step. Then, working and steering committees should be formed in order to conduct studies of GIS. As indicated, Sustainable Development Goals may help the process of prioritization for global socio-economic challenges. The formation of expert panels toward policy making for prioritized problems to determine policy aims, recommendations and tools is the next step. A collaborative project financing mechanism should be designed to carry the determined policies into effect and conduct projects.

Constructing an effective GIS which is built upon a participatory bottom-up decision-making process and based on the consensus-building approach rather than conflict resolution is not an easy task. However, the creation and governance of a GIS are possible through the transformation of the existing global socio-technical system with small starting steps and well-defined mechanisms as summarized in the previous paragraph. Considering the existing challenges, such an approach needs urgent action.

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The year ahead in 2019 – Think local when acting globally

9. Januar 2019 - 15:09

For 2019, the global challenges are unlikely to become fewer than in 2018, based on the past experiences. The post-cold war international order as we knew it has taken a few blows again in 2018. Some key pillars and narratives are being shifted and challenge the stability of the international architecture. As often with foreign relations, it takes place in a context that consists of both global challenges and domestic priorities. Indicators for change will thus be located in domestic politics of some key countries. Without wanting to sound overly optimistic for a surely difficult year to come, some elements for a change are visible.

Multilateralism under pressure – with “go-alone” increasingly to hurt own interests

On multilateralism, we face ongoing challenges by the once-guarantee power for the international order, the USA. The ongoing trade dispute between the US and China is a key example for “my-country-first” policies. US-China trade relations have suffered already, exacerbating a difficult economic situation in China. It has, overall, dimmed the global economic prospects for 2019, with German Finance Minister Scholz warning that “the fat years” are over. Some hope is in the fact that bilateral discussions are continued and negotiations between the US and China may lead to a beneficial understanding.

The stronger pressure for change is, however, domestic. Yet, the US President is under increasing domestic pressure in particular due to a change in the composition of Congress, where Democrats have gained a majority in the House of Representatives. While President Trump’s hands are increasingly tied domestically, he may increasingly focus on issues of international relations picking quarrels with old allies and new rivals. At the same time, the other great power, China, continues to develop its reach, portraying itself as a new guarantor of the international order (remember President Xi speaking in Davos in 2017). Yet, Beijing applies multilateralism only very selectively, rather favouring China-to-region relations, not least so under the narrative of the Belt-and-Road Initiative (BRI) and in its relations to African countries, too. Related to this, in 2018, we have seen some debt challenges in African countries such as Ethiopia and Kenya as a result of Chinese loans. Debates on this are likely to continue and will put China’s rise and Xi Jinping’s BRI under more pressure in partner countries. Chinese commentators are likely to cry “Western interference”, but debates are mostly domestic in African countries (never mind “Westeners” to pick up on it).

Populism likely to continue in 2019

While populism is alive and kicking, key Southern states face elections in 2019: South Africa, India and Indonesia, inter alia. South Africa politics has gotten on a more stable path, in time before elections in April this year. Similarly, and around the same time, India and Indonesia are facing elections. In South Africa and India, the incumbents are likely to win a new mandate, but the interesting part will be if they get an outright majority or face difficulties in forming a government. In Indonesia, the incumbent also appears to be the front-runner. Populism (and nationalism) is likely to mark all campaigns. Brazil and Mexico, for their part, have already seen the change of power to (radically different) populists in 2018. Electoral debates in Brazil in 2018 were shocking. In Brazil, established legislative and judicial institutions as well as the civil society will have to ensure that democratic processes continue to function and individual rights remain guaranteed. In Mexico, a month earlier (December 2018), a left-leaning populist took over the presidency, promising radical change from a different direction. In both countries, the new administrations will have to deliver on bold election promises. We can expect the seeds of discontent in their electorate to sprout in the future.

The European Union, for its part, will have to live up to a number of challenges in 2019, including elections and a new commission. However, first and foremost, 2019 will continue as most of 2018, with debates around “Brexit”, which is bound to happen in March this year. Well, will it? Uncertainty around the process is high – and everything seems possible in the domestic policy gambling in an unstable government in London. Germany, for its part, has seen the beginning of a change-over in power, with the announced departure of Chancellor Merkel, and faces challenging regional elections. These elections – European in May and German regional in autumn – could still derail the coalition in Berlin. Internal challenges to the European liberal order are continuing in Hungary, Poland, but also strong populist politics in Italy, Austria and others. In a number of these countries, civil society increasingly challenges populist governments, but it is still open how these debates play out.

At the supranational level, the elections to the European Parliament in May 2019 is likely to see the far-right strengthened, but also offer an opportunity for public discussions on the benefits of the Union to societies of its member states. On the positive side, rates of approval for the Union are going up throughout the EU and societies appear to re-discover the value of a unified Europe. The fault-line within the European Parliament will be even more pronounced between those wanting more cooperation– and those critical of further integration.

Preserving or rebuilding a rules-based international order?

With these challenges, a retreat to cyncism is the wrong answer. 2019 will require active shaping of policy spaces, because they become smaller. There certainly is no natural culmination point (or “end”) of history. Political solutions are negotiated internally, and democracy constantly remains to be defended. And with more polarized national debates, the international setting is not becoming easier.

Multilateralism always results in compromises and thus is difficult to argue for during heated debates. Hotheads, however, eventually also realise that consultations and compromises might be at times cumbersome, but are, overall, less expensive than driving an agenda on testosterone. Working in a rules-based environment allows for time to focus on content, rather than who’s loudest. This will be an important pre-condition for significant UN summits ahead of us in 2019, such as the SDG and Climate Summits. The G20 will meet in Osaka, Japan, in June and the G7 in August in Biarritz, France. ‘Club governance’ comes with obvious limitations over truly multilateral mechanisms, but we argue that the setts such as the G20, with 19 states plus the EU meeting in various formats, continues to have its benefits.

In current times, multilateralism is not fashionable. We are often thrown back to the logic of the nation state, and we need to reconnect with parts of the population that feels left out. However, simply hanging on to “the olden days” was never a receipt for long-term success. In our current world, contacts across borders are more intense than ever. “Think global, act local” is a well-seasoned slogan – and we should also consider “think local while you are busy acting globally”. Solutions to very local problems are to be found in global cooperation – and this needs to be explained ever more. And while preserving key global achievements, new narratives and new mechanisms in the political discourse well have to be found. Every new year comes with challenges – and every future needs to be shaped.

Der Beitrag The year ahead in 2019 – Think local when acting globally erschien zuerst auf International Development Blog.