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January 2016

Local content in extractive industries: a tool for economic diversification and sustainable development

Anita Marangoly George's picture
Photo by Dominic Chavez / World Bank

When you ask young people from developing countries what they want for their country, they often say opportunity. The next generation wants jobs and knowledge; they want to be connected to the global economy.

Extractive industries can foster these types of opportunities through investment in skills training and transfer of technology to local workers and companies. These technical skills are demanded in the global marketplace today and empower workers to expand their horizons and lower their risk of unemployment. 

We are discussing these issues today at a “Reconciling Trade and Local Content Development” conference we are co-hosting with the Mexican Ministry of Economy. This event aims to share knowledge on how investment in extractive industries can be leveraged to generate opportunities for economic diversification and employment.

When extractives companies include local business in their supply chain they foster sustainable growth and help end poverty. The most valuable contribution to long term sustainability comes from the ability of extractive industries to generate benefits through productive linkages with other sectors. The International Finance Corporation (IFC) helped make this happen in Barmer, India, where we supported a Skill Development Center that trained 7,000 people to work in the operations of Cairn Energy. Not only did this training create direct job opportunities for the local population, but the acquired skills fostered the creation of an entire eco-system of small and medium-size enterprises that provided products and services to the oil company and related sectors.

Eyes in the sky help track rural electrification

Kwawu Mensan Gaba's picture
Front page of nightlights.io with an overview of India.
“Nightlights.io is a path-breaking platform that will transform the way the world solves the global challenge of energy availability. The tool will help us... provide energy solutions... to people who need it most.” — Tejpreet Chopra, President and CEO of Bharat Light and Power


Electricity is integral to people’s well-being across the world. With electricity, children can study at night, women can walk home more safely on well-lit streets, and businesses can stay open well past dusk.
 
However, more than one billion people still lack access to electricity today. Governments and electric utilities around the world are mobilizing vast sums of money to close the access gap, especially in rural areas that are home to those lacking electricity.
 
So, how can we determine and identify who has electricity and who doesn’t? What if we had the technology and tools to help us see lights from space every night, for every village, in every country? We could then closely monitor progress on the ground. We could even plan and optimize policies and interventions in a different manner.

Are stars aligning for clean energy financing?

Håvard Halland's picture
How sovereign and hybrid funds may help address climate change 

Solar power in FYR Macedonia. Photo by Tomislav Georgiev / World Bank.


One of the biggest bangs at the opening day of the Paris COP21 climate summit was without doubt the dual financing announcements by the Breakthrough Energy Coalition, led by Bill Gates and other high-net-worth individuals, and the Mission Innovation, whose signatory governments have committed to doubling their allocations to clean energy research. The two initiatives aim to increase financing for clean energy innovation, from the basic research stage, funded by governments, to commercialization of promising new technologies—with venture financing provided by private investors.

In developing countries, where many households and companies have very limited access to energy, new clean energy technologies will serve the dual purpose of expanding energy access and constraining carbon emissions. For this to happen, innovative thinking will be needed not only in the development of new technology, but also in financing the deployment of these technologies.

The two initiatives announced in Paris reflect the realization that carbon dioxide emissions would continue to rise even if every commitment to cut carbon emissions were fulfilled. By 2035, the concentration of carbon in the atmosphere will already exceed the estimated levels required to maintain the internationally agreed 2 degrees Celsius limit. The development of new technologies will increase the options available to efficiently address climate change.

Renewable energy export-import: a win-win for the EU and North Africa

Sameh Mobarek's picture

Also available in: Arabic | French | Spanish

Rows of solar panel at a thermo-solar power plant in Morocco. Photo by Dana Smillie / World Bank.
Rows of solar panel at a thermo-solar power plant in Morocco. (Photo: Dana Smillie / World Bank)

Over the past several years much has been written about the significant potential for solar energy generation in the Middle East and North Africa, where there is no shortage of sunshine. The International Energy Agency estimated that the potential from concentrated solar power technology alone could amount to 100 times the electricity demand of North Africa, the Middle East and Europe combined.   

In the wake of commitments at the Paris climate conference (COP21), it is time to develop this rich source of low-carbon energy sitting close to Europe’s southern shores, and bolster efforts to agree on a framework to import clean, sustainable energy from North Africa. 

As recently as 2012 there have been efforts to adopt a framework that would allow importing renewable energy from Morocco to Germany—through France and Spain—but electricity trade between countries typically becomes reality when there are economic benefits for all sides. Electricity trade has the added benefit of fostering closer political ties. 

Expanding regional trade between North Africa and Europe has also been hindered by inadequate physical electrical connections between the two continents and poor physical integration in European electricity grids. There is currently only one electrical transmission interconnection between North Africa and Europe, namely the Morocco-Spain connection.  Further, Spain’s interconnection with the rest of Europe is limited, with no new transmission projects undertaken to expand this capacity for the past three decades. At the same time, Spain had excess generation capacity because of the economic downturn experienced in Europe over the past several years. That made impractical the notion of allowing North African renewable energy into the Spanish market. Italy, another potential electricity gateway from North Africa, was in a similar situation.

Six stories show renewable energy underpins a climate-friendly future

Andy Shuai Liu's picture

Also available in: Arabic | French | Spanish


In 2015 the world saw great momentum for climate action, culminating in a historic agreement in December to cut carbon emissions and contain global warming. It was also a year of continued transformation for the energy sector. For the first time in history, a global sustainable development goal was adopted solely for energy, aiming for: access to affordable, reliable, sustainable and modern energy for all.
 
To turn this objective into reality while mitigating climate change impacts, more countries are upping their game and going further with solar, wind, geothermal and other sources of renewable energy. As we usher in 2016, these stories from around the world present a flavor of how they are leading the charge toward a climate-friendly future.  
 
 World Bank Group

1: Morocco is rising to be a “solar superpower.” On the edge of the Sahara desert, the Middle East’s top energy-importing country is building one of the world’s largest concentrated solar power plants. When fully operational, the Noor-Ouarzazate power complex will produce enough energy for more than one million Moroccans and reduce the country’s dependence on fossil fuels by 2.5 million tons of oil.