Albert Einstein once said: “The only source of knowledge is experience.” For years I have wondered about this. Surely you can understand something without actually having done it. After all, mankind’s understanding of the vast universe is greater than what can be directly experienced, and some of it is derived from theoretical reasoning. I was on my way to the 2018 Africa Carbon Forum to share fiscal policy lessons under the CAPE program and the debate was still raging in my head when I arrived at the UN campus in Nairobi Kenya.
The World Bank Group (WBG) is currently implementing a new approach to development finance that will help better support our poverty reduction and shared prosperity goals. This crucial effort, dubbed Maximizing Finance for Development (MFD), seeks to leverage the private sector and optimize the use of scarce public resources to finance development projects in a way that is fiscally, environmentally, and socially sustainable.
There are several reasons why cities and transport planners should pay close attention to the MFD approach. First, while the need for sustainable urban mobility is greater than ever before, the available financing is nowhere near sufficient—and the financing gap only grows wider when you consider the need for climate change adaptation and mitigation. At the same time, worldwide investment commitments in transport projects with private participation have fallen in the last three years and currently stand near a 10-year low. When private investment does go to transport, it tends to be largely concentrated in higher income countries and specific subsectors like ports, airports, and roads. Finally, there is a lot of private money earning low yields and waiting to be invested in good projects. The aspiration is to try to get some of that money invested in sustainable urban mobility.
- mass transit
- public transport
- credit guarantees
- Bus Rapid Transit
- urban rail
- climate finance
- Green Bonds
- Land Value Capture
- infrastructure financing
- urban transport financing
- transport financing
- Private sector participation
- public-private partnerships
- urban mobility
- urban transport
- sustainable cities
- sustainable mobility
- Sustainable Communities
- Public Sector and Governance
- Private Sector Development
- Financial Sector
- Climate Change
- Urban Development
Climate change poses a significant threat to the economic development of countries around the world. – in part due to a combination of higher agricultural prices and threats to food security and health – especially in the poorer parts of the world. The Paris Agreement and the 2030 Sustainable Development Goals (SDGs) have provided commitments to tackle the most urgent of these environmental challenges.
The following post is a part of a series that discusses 'mind and culture,' the theme of the World Bank’s upcoming World Development Report 2015.
Recently I was asked to give some feedback on the upcoming World Development Report 2015 (WDR 2015). WDR 2015 will be both important and timely. The following are some initial suggestions for the report.
Innovations in youth employment programs are critical to addressing this enormous development challenge effectively. Rapid progress in digital technology, behavioral economics, evaluation methods, and the connectivity of youth in the developing world generates a stream of real-time insights and opportunities in project design and implementation. Part of the challenge is the sheer number of projects (just in Egypt, there are over 180 youth employment programs). And even without being aware, projects often innovate out of necessity in response to situations they face on the ground. But innovations need to be tested in different country contexts to be able to make an impact at scale.
Through the new Solutions for Youth Employment (S4YE) report, our team ventured to curate a few such ongoing innovations as they were being implemented through S4YE’s Impact Portfolio — a group of 19 youth employment projects from different regions being implemented by different partners across the globe. This network of youth employment practitioners serves as a dynamic learning community and laboratory for improving the jobs outcomes of youth globally.
Photo: World Bank Group
By committing to the Sustainable Development Goals (SDGs), countries pledge to pursue progress on economic, social, and environmental targets, in a balanced and integrated manner. The SDGs are cross-cutting and ambitious, and require a shift in how we work in partnership. They also push us to significantly change the level of both public and private investment in all countries.
We need creative solutions to leverage each partner’s comparative advantage. We also need to mobilize private sector investment and innovation in support of the SDGs.
It is the development conundrum of our era. Extremely poor people cannot lift themselves out of poverty without access to reliable energy. More than a billion people live without power today, denying them opportunities as wide-ranging as running a business, providing light for their children to study, or even cooking meals with ease.
Ending poverty requires confronting climate change, which affects every nation and every person. The populations least able to adapt – those that are the most poor and vulnerable – will be hardest hit, rolling back decades of development work.
How do we achieve the dual goals of expanding energy production for those without power and drastically reducing emissions from sources such as coal that produce carbon dioxide, the primary contributor to climate change?
There is no single answer and we cannot ask poor communities to forego access to energy because the developed world has already put so much carbon pollution in the air.
An array of policies and programs backed with new technology and new thinking can — if combined with political will and financial support — help poor populations get the energy they need while accelerating a worldwide transition to zero net carbon emissions.
Three trends in the global financial market are converging to make sukuk, the Islamic financial instrument most similar to a conventional bond, a potentially viable form of finance for green investments: (1) banks are reluctant to finance infrastructure due to stricter capital requirements; (2) an increasing number of investors are interested in ‘environmentally sustainable investing’ (in other words, investing to promote activities seen as positive for the environment); and (3) the market for sukuk is growing significantly. While these three trends are distinct and not obviously related, taken together, they create a market opportunity for sukuk to be used as a tool to finance environmentally sustainable infrastructure projects.
The need for significant infrastructure spending is obvious in both developed and developing countries. From crumbling transportation infrastructure in the United States to inadequate power generation capacity in India, the evidence is clear that improving infrastructure is a global priority. At the same time, popular concern about climate change and the detrimental impact of increasing greenhouse gas emissions has also made improving infrastructure in an environmentally sustainable manner a priority.
“Growing a Green Bond Market in Mexico: Issuers and Investor Summit” was held Oct. 27 in Mexico City, organized by the International Finance Corporation (IFC), the Asociación de Bancos de México, HSBC, and Crédit Agricole. The timing could not have been better. Although the first green bonds were issued in the last decade, their popularity has exploded in recent years. According to estimates, the market will be a $40 billion one this year, a figure that represents a fourfold increase relative to last year.
A green bond is a financial market debt instrument. Its uniqueness lies in the commitment of the issuer to channel the funds raised exclusively toward green projects, that is, projects that have a positive impact on climate change and involve both renewable energy and energy efficiency.
Globally, more than 700 million women alive today married before the age of 18. Each year, 15 million additional girls are married as children, the vast majority of them in developing countries. Child marriage is widely considered a violation of human rights, and it is also a major impediment to gender equality. It profoundly affects the opportunities not only of child brides, but also of their children. And, as a study we issued this week concludes, it has significant economic implications as well.