The idea of “Inclusive growth” and how to achieve it was talked about a lot in the days ahead of the 2014 World Bank-IMF Annual Meetings. Among the solutions on the table was a new initiative that could help unlock billions of dollars for infrastructure and improve the lives of many.
About 1.2 billion people live without electricity and 2.5 billion people don’t have toilets. Some 748 million people lack access to safe drinking water. The Global Infrastructure Facility (GIF) announced by World Bank Group President Jim Yong Kim this week hopes to lower these numbers by developing a pipeline of economically viable and sustainable infrastructure projects that can attract financing.
How can economic growth benefit more people? What will it take to double the share of renewables in the global energy mix? Will the world have enough food for everyone by 2050? You can hear what experts have to say on these topics and others, ask questions, and weigh in at more than 20 webcast events from Oct. 7 to 11. That's when thousands of development leaders gather in Washington for the World Bank-International Monetary Fund Annual Meetings. Several events will be live-blogged or live-tweeted in multiple languages. You can also follow the conversation on Twitter with #wblive and other hashtags connected to events. We’ve compiled a sampling of events and hashtags below. Check out the full schedule or download the Annual Meetings app for Apple devices and Android smartphones.
These “Project Bonds” mostly target institutional investors - including pension funds, and have generated a great deal of interest among investment bankers, lawyers and investors. All this hype raises a number of questions: Are these “Project Bonds” really living up to expectations? Can governments really rely on Pensioners Paying for Projects (a newfound meaning for PPPs!)? What do we need to do to turn these instruments into a significant source of financing and close the infrastructure investment gap?
Construction of the Quito Metro
NGOs, lending agencies, and the public sector are hard at work in meeting the global sanitation target. But what about the private sector, and what about the families that do not want to wait for the next NGO to knock on their door with a better toilet? Over the past couple of years, the Water and Sanitation Program’s (WSP) Sanitation Marketing strategy in Bangladesh has tried to address these concerns by stimulating the supply and demand of hygienic sanitation facilities through the mobilization of local entrepreneurs. The objective of Sanitation Marketing is for families to have the desire and the agency to move up the sanitation ladder on their own.
In 2009, the pilot program began in five villages in the Jamalpur district, and has now been scaled-up to around 230 villages across Bangladesh with support from the Dutch WASH Alliance, International Development Enterprises, and the Max Foundation. WSP also strategizes and implements the project with Hope for the Poorest (HFP), a local Bangladeshi NGO, and the Association of Social Advancement (ASA), a microfinance institution.
Mohammed Jalal is one of the many sanitation entrepreneurs supported by Sanitation Marketing in the Hobiganj district where WSP has began scaling up the initiative since 2011. Through microfinance loans from ASA and small-business training sessions from WSP, Mr. Jalal was able to open two stores in Hobiganj. Mr. Jalal’s shops are decorated with colorful flags to attract customers and are filled with an assortment of sanitation products such as handwashing stations and off-set pit latrines. With a catalogue in hand, Mr. Jalal markets his products to local villages and gives households the chance to move up the sanitation ladder. Customers are able to choose the materials and colors of their latrine and are most importantly, able to choose the type of sanitation facility that fits into their budget. Products range from Tk 1,600 (US $20) to Tk 20,000 (US $250), and all Sanitation Marketing entrepreneurs offer an installment plan for families to pay for their products over time. WSP additionally connects these entrepreneurs to the local government in order to establish whether any families in the area are eligible for subsidies. In the Hobiganj district alone, Sanitation Marketing has been able to support over 17 entrepreneurs like Mr. Jalal to serve hundreds of happy customers.
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What’s a cash-tight government to do when it wants to modernize a hospital, build a railway, or expand the power grid to reach underserved areas? It might explore outside, private sources of financing—that’s where public-private partnerships (PPPs) come in. The acronym has a promising ring to it, yet going back to the 1970s, its impact has been mixed. At their best, PPPs can provide rapid injections of cash from private financiers, delivery of quality services, and overall cost-effectiveness the public sector can’t achieve on its own.
But at their worst, PPPs can also drive up costs, under-deliver services, harm the public interest, and introduce new opportunities for fraud, collusion, and corruption. Our experience at the World Bank Integrity Vice Presidency is that because PPPs most often are geared toward providing essential public services in infrastructure, health and education, the integrity risks inherent in these sectors also transfer to PPPs.
On April 17, the Integrity Vice Presidency convened a public discussion on corruption in PPPs (pdf) bringing together finance, energy, and fairness-monitoring perspectives. Looking at the landscape, in the last eight years, 134 developing countries have implemented PPPs in infrastructure, and in the last decade the World Bank has approved some $23 billion lending and risk guarantee operations in support of PPPs.
For the past five years, the participants to the Annual Meetings of the World Economic Forum (WEF) have gathered in Davos to discuss urgent global crises the world was facing: subprime lending, the credit crunch, banking, Greece, the euro zone’s woes, and so on. Soul-searching about the political and economic status quo ensued. This year, with leadership transitions in the two largest economies completed, the euro zone no longer facing imminent break-up, and China growing at 7.8%, Davos resumed some normalcy. Some even claimed optimism.
Some of the optimism is based on the growth prospects in Asia and China. For the past five years, while Europe has not grown at all, Chinese GDP has grown 60%. In this year’s Davos, there were no fewer than five public sessions on China, with topics ranging from its rapid growth, transformation of its growth model, and emergence of its soft power. Interests in Asia are high.
Last week, I had the honor of being part of the fourth World Innovation Summit for Education (WISE), in Doha. Pratham, the recipient of the 2012 WISE Prize for education, was praised as a renowned leader in the field of education for providing innovative, low-cost solutions for mass literacy and numeracy in developing countries. Pratham’s CEO and co-founder, Madhav Chavan, received the award, which recognizes “world-class” contributions to education.
While in Doha, I had the pleasure of being part of a WISE panel debate with Mr. Chavan, which also included Financial Times correspondent Chris Cook and Dr. Talal Abu-Ghazaleh. Anver Versi, editor of African Business and African Banker, was the moderator. During this panel, we discussed innovative financing and the role of public-private partnerships in education. Mr. Chavan began his remarks stating that, “Education is too important to be left to governments alone.”
Over the past decade, Peru has enjoyed one of the best performing economies in Latin America – one that took the financial crisis in stride. Now its focus is on sustaining this trajectory and, with about a third of the population in poverty, spread the economic gains more broadly. The JKP team and Vox LACEA spoke on the subject with Luis Miguel Castilla, Peru’s Minister of Economy and Finance, who says his top economic priorities are growth, productivity, and social inclusion.
Last week, MIGA hosted a panel discussion on the role of the private sector in sustainable growth as part of the World Bank Group’s Sustainable Development Network Forum 2012. Taking the initiative as an agency of the World Bank Group that encourages investment by the private sector, MIGA brought this angle to the more general sustainable growth discussion.
Keynote speaker Jeffrey Leonard from the Global Environment Fund opened citing the World Bank President’s remarks on sustainable development that were right on the money – outlining an urgent need for attention to the matter, noting that resources must be made available – yes, good, onward! The catch? They were attributed to a president who left office 25 years ago (Tom Clausen).
- The World Region
- Private Sector Development
- Sustainable Development
- public-private partnerships
- Multilateral Investment Guarantee Agency
- Mary Boomgard
- Marsh USA
- Mahlette Betre
- Julie Martin
- Jeffrey Leonard
- Global Environment Fund
- Equator Principles
- Deniz Baharoglu
- David Vidal
- Conservation International
- Conference Board
- Carbon Finance
- Benoit Bosquet