Thursday, 31 October 2019

World Bank Blogs/Philippe H. Le Houérou and Antoinette Sayeh: IDA is a vital development partner now more than ever

IDA is a vital development partner now more than ever


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11-year-old Jessica Prudent from Port-au-Prince, Haiti. © World Bank
11-year-old Jessica Prudent from Port-au-Prince, Haiti. © World Bank
It is undeniable that progress has been made in reducing extreme poverty over the last quarter century—from 36 percent of the world population in 1990 to an estimated 8.6 percent in 2018—and that living standards for hundreds of millions of people have improved over that time.
Yet, poverty reduction has not been consistent across countries and today it is slowing. For the world’s poorest countries, extreme poverty remains stubbornly high with 31 percent of their people living on less than $1.90 a day. 
Many countries lag in their progress towards other development targets: two out of five people lack access to electricity; one out of three lacks clean drinking water; and one in five people remains malnourished. While countries have made progress, it is clear that stark challenges remain.
For nearly 60 years, the International Development Association (IDA)—the concessional lending arm of the World Bank Group—has not shied away from these challenges. IDA provides development financing in the form of grants and loans at zero or low interest to governments in the poorest countries.  At a time when debt vulnerabilities are rising for many countries, IDA funds support the critical investments that can broaden economic growth and help countries overcome the unique problems they face.
With IDA’s support, countries have made progress in even the toughest environments. In the Democratic Republic of Congo, IDA has contributed to economic recovery by connecting farmers to markets with rural roads in 715 villages, and by creating 50,000 jobs in civil works with a focus on youth and women.
In Afghanistan, IDA-supported projects have generated 5,500 kilowatts of power, built 850 kilometers of roads, and provided 63 million liters of drinking water per day, benefiting 4.5 million people. And in Haiti, IDA’s support has helped immunize 640,000 children and ensured skilled birth attendants at 20,000 births.
But IDA’s value extends beyond financing. For years, IDA and its partners have prioritized learning, innovation, and results to provide cutting edge solutions to these complex issues.  In fragile and conflict situations, IDA is using its growing knowledge base to better address the risks and drivers of fragility.
IDA has scaled up its support for regional solutions, helping countries add to ongoing integration efforts and partnering on new global and inter-regional initiatives. In the Sahel, as the largest donor to the region, the World Bank is well placed to convene clients and partners to identify solutions to a range of development challenges, especially those related to the regional dimensions of fragility. On track to double the three-year commitments of $2.5 billion under its previous replenishment period, IDA plans to scale up support to the Sahel further, with financing expected to increase to $6.5 billion, subject to country performance.
IDA anchors the World Bank’s support to small states, which face unique challenges due to their size and often geographical isolation.   During the current three-year IDA cycle, commitments to eligible countries have surpassed $1.7 billion, already exceeding the $1.2 billion total during the previous cycle. This scale-up has been pivotal in responding to natural disasters and strengthening resilience. For example, the Pacific Climate-Resilience Project is helping build more resilient transport infrastructure in Samoa, Tonga, Tuvalu, and Vanuatu.
IDA has a unique ability to play a credible leadership role in pursuit of global agendas as diverse as marine litter, crisis preparedness and response, debt sustainability, gender equality, and climate change.
On climate change, IDA is helping countries implement their climate targets. Over IDA18’s first two years, IDA has strengthened support for countries in adapting to the effects of climate change ($7.8 billion total) and improving mitigation efforts ($5.9 billion total). In addition, all IDA operations are screened for short- and long-term climate change and disaster risks.
IDA is also leveraging the strengths of the entire World Bank Group—including the International Finance Corporation and Multilateral Investment Guarantee Agency—to ensure that resources, expertise, and solutions are maximized in the most challenging places. Two years ago, IDA’s shareholders broke new ground with the launch of the IDA Private Sector Window, a $2.5 billion facility aimed to help offset risks and other impediments to private sector investment in the world’s most challenging markets, including those with weak government capacity, inadequate legal frameworks, a lack of capital markets, and limited infrastructure.
Perhaps as important as these innovations is IDA’s results-oriented, country-led model that puts countries in the driver’s seat of their own development. IDA responds rapidly and flexibly and ensures that the resources it allocates to countries address their most pressing concerns and needs while building the appropriate institutions and systems.   

IDA remains a unique platform that enables other development partners to operate at their full potential by reducing aid fragmentation among donors, and administrative burdens for client countries.  This also enables IDA to build strong and effective partnerships with other bilateral and multilateral agencies and national institutions, the United Nations, the private sector, and civil society.
As IDA moves toward concluding its 19th replenishment (IDA19) together with its partners in December this year, we have heard loud and clear that IDA must continue to respond with urgency to today’s greatest development challenges.
With our partners, IDA has developed a very strong policy package for IDA19 that will invest in the growth, people, and resilience of the countries most in need. It sets IDA on a more ambitious path, squarely focused on results and impact, and increased demand from IDA borrowers.
A strong IDA19 replenishment will enable us to better support countries in these challenging times. We are grateful for the support from our large community of donors, who recognize the value of IDA’s partnership and who help make development progress possible.
During the World Bank Group’s 2019 Annual Meetings, IDA champions from China, France, the Netherlands, Saudi Arabia, Sweden, and the United Kingdom called for a strong IDA19 replenishment. And statements of support for IDA19 from governments across Africa, the Middle East, South and Southeast Asia, and the Pacific reinforce our belief that a fully resourced IDA can and should do more.
Recognizing that time is short, it is more important than ever to act with urgency on the critical work ahead.  We call on IDA’s donors to join us and ensure that we achieve a strong IDA19 replenishment that meets the ambitions we all share. Together, we can continue to reduce poverty, raise prosperity, and achieve our shared goals for the people most in need. 
Philippe Le Houérou is Chief Executive Officer of the International Finance Corporation. Antoinette Sayeh is a Distinguished Visiting Fellow at the Center for Global Development. They serve as the Co-Chairs for the negotiations of the 19th Replenishment of the International Development Association, which is scheduled to conclude in December 2019.


Philippe Le Houérou

Philippe H. Le Houérou

Executive Vice President and CEO of IFC
انطوانيت السايح

Antoinette Sayeh

Visiting Fellow at the Center for Global Development

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Has The Time Now Come To Scrutinise Monies Flowing Out of Ghana As Repatriated Profits - And Halt Money-Laundered Cash Outflows That Way?

According to an agence france-presse story carried by the Guardian newspaper's online edition, "The Malaysian financier at the heart of the massive 1MDB graft scandal has struck a settlement to forfeit assets worth $700m including a Beverly Hills hotel and a private jet, the US justice department has said."

There is no question that if Jho Low  had had the presence of mind to have ventured into Ghana, instead of the U.S., that daring young Malaysian financier at the heart of the  1MDB scandal,  would have quadrupled his net worth and sent it to stratospheric heights, by now. 

Indeed, it is not beyond the realms of possibility that sundry Ghanaian public officials, including bankers, and some of those put in charge of sundry regulatory bodies, would have all bent over backwards to empower him to set up banks, real estate companies, build posh hotels, etc., etc., whiles all the time repatriating vast sums through the banking system to offshore accounts in Panama and the British Virgin Islands.

The question is: Has the time not now come to halt the billions of dollars regularly flowing out of Ghana, unlawfully, in the name of repatriation of corporate profits? If such sums are not declared to the Ghana Revenue Authority  (GRA), how possibly can they be anything other than unlawful money-laundering cash being smuggled out of Ghana? Haaba. Yooooo. Hmmmm. Oman Ghana eyeasem ooooo. Asem kesie ebeba debi ankasa.

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The Conversation/ Michael O Alabi: Nigeria’s Akure is a good example of how not to build a city

Nigeria’s Akure is a good example of how not to build a city

On Akure’s edges, which used to be mainly farmland, buildings are taking over. Author supplied
Akure is one of Nigeria’s emerging cities. Located within Ondo State in the country’s south west, it’s a settlement about 350kms from Lagos where roads meet from major towns such as Ilesa, Ondo, Owo and Ado-Ekiti.
Its population is climbing fast. In 2006 it was home to about 484,798 people. Today the population is estimated to be about 637,458 and growing as people move to it from rural areas.
But the way in which local authorities are going about building the city is deeply flawed. It also doesn’t to take into account lessons learnt from elsewhere in the world about how best to build healthy cities. For example, one of the main health risks for city dwellers is a lack of access to green spaces. Another is the fact that people are often forced to travel vast distances to get to work.
In a recent research paper I explored the way Akure is being developed. There are two major problems with the approach the city is taking. The first is that green spaces are being lost because city officials have cleared green open spaces and farmlands on the edges of Akure to make room for buildings. Satellite images that I examined showed that where thick vegetation and farmlands accounted for about 51.5% of land cover in 1986, that stood at just 38.8% in 2018.
The second problem that people are being moved to formerly green spaces at the very edge of the city and this is taking a big toll on them financially and from a health perspective.
I found that city officials have not considered how approaches like mixed-use developments closer to the city centre might alleviate the housing shortage as well as protect Akure’s green spaces.
A balance must be struck between accommodating the town’s growing population and making sure that urbanisation doesn’t entirely wipe out green spaces and farm land. This is possible, as is clear from initiatives in China, Thailand, Brazil and Australia.

What the study found

In my study I explored whether people understood why green spaces matter. I also wanted to know how they felt about living far from the centre of the city.
People saw the increase of building in their areas as a threat to their main source of livelihood, which is farming. They were worried about their culture being eroded by strangers joining their communities. Unemployment was rising and crime was increasingly becoming a problem. People were looking to the city centre for employment, but this brought new challenges.
Respondents told me that living far from the city centre took its toll. Getting to the city centre, where most offices and businesses are, costs them a lot of money; nearly 70% said that up to 10% of their income was spent on transport. Transport is also not well organised in the area, with most people relying on commercial taxi cabs or motorcycles commonly known as okada.
Accessing services was very difficult, too. Healthcare facilities weren’t always easy to reach.
People told me they were exhausted because of the long commute, stressed about getting to work late when transport didn’t run on time, and worried about accidents on the road. Crime was a worry too, especially in peripheral areas of Akure that aren’t under the control of traditional heads. These leaders provided order even when there weren’t police stations or posts nearby.

Eco-city approach

So how can Akure, and other Nigerian cities, attempt a different approach to urbanism?
First, it’s important to point out that there’s no single approach or solution.
Broadly speaking, though, I think that an eco-city strategy could be adopted. This is a human settlement modelled on the self-sustaining resilient structure and function of natural ecosystems. An eco-city seeks to provide healthy abundance to its inhabitants without consuming more renewable resources than it replaces.
For starters, Akure needs to revise its land use priorities to create compact, dense, mixed-use communities, preserve the farmlands in the form of urban agriculture, and work to create a garden-like city. It must also develop an efficient transport network. This could include trains and trams.
Of course not every single resident can live in the city centre, so it’s crucial that those slightly further out are able to travel easily and without having to spend a fortune.
Crucially, the government needs to develop policies that lay the groundwork for sustainable, liveable cities. Obviously a huge part of that is ensuring people have places to live. But green spaces matter too, and are key to creating liveable cities that are self sufficient and have plenty of parks for recreation.
Finally, it must be harder for people to simply take over green spaces on the edges of the city. At the moment, this happens very easily and with little consultation. One approach to consider is imposing a tax on building in areas that might instead be used as parks or forest reserves. This would make such spaces less attractive for developers.
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Catesby Holmes
Global Affairs Editor
  1. David Green

    ‘On [the city]’s edges, which used to be mainly farmland, buildings are taking over’
    Stop The Presses !
    This only describes just about every urban habitation and its expansion over time with population increase.
    Orange County south of Los Angeles California - now almost entirely (on the non-mountain areas) covered with suburbia - used to be - where they grew Oranges …
    First dwellings choose the best flat arable land next to a river so they can farm the land. Following dwellings build next door, eventually covering all the best farmland - first. Hello and Goodbye to all that.

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RenewEconomy/Giles Parkinson: Electric vehicles will drive 20-fold lift in battery storage capacity by 2030, says AGL

Electric vehicles will drive 20-fold lift in battery storage capacity by 2030, says AGL

AGL says it anticipates a 20-fold increase in behind the meter battery storage capacity in Australia over the next 10 years, driven by the influx of electric vehicles which it says will account for half of all new car sales by 2030. And it intends to tailor its business accordingly.
In a sure sign that AGL is recognising the shift from a business model based around centralised generation, AGL says its future business model will be based on the “shared” economy in electricity and transport, focused around customer choice of rooftop solar, household batteries and electric vehicles.
In its annual “investor day” presentation to analysts on Wednesday, which also included news of its contract to buy four large scale batteries in NSW, and its intention to seek other big battery opportunities in other parts of the grid, AGL predicted there would be 2.6 million EVs on the road in Australia by 2030.
This would mean that EVs would account for around 50 per cent of new car sales – just as outlined by Labor in its pre-election policy targets that were mocked by the Coalition and conservative media.
Not only that, AGL expects the shift to autonomous driving and shared transport to also happen quickly. “Less than 1/3 of consumers will actually own cars,” says Dominique Van Den Berg , the head of distributed energy at AGL. “Electric vehicles will accelerate that transition.”
The company’s presentation noted the number of homes and businesses with battery storage would likely jump to 700,000 by 2030, but in some scenarios could match the current coverage of rooftop solar, or about one in four homes, or nearly two million.
However, this is expected to be dwarfed by the number of electric vehicles on the road, which could increase the battery storage capacity 20-fold by 2030, to a total of 40GWh, with most of that coming from EVs.
Some analysts, such as Bloomberg, have suggested that the battery resource from EVs could be ten times that number once the fleet becomes fully electric, and AEMO, like other international grid operators, is also starting to study how it can tap into that resource.
The trick for utilities like AGL will be to understand when, where and how they will be charged and able to provide energy back into the grid, and how to harness those assets into their business models and consumer offerings. AGL’s focus in on “orchestration”. But it’s yet to be seen how that can be done.
AGL’s efforts are being driven by changes in technologies and also emerging competition from new retailers eyeing opportunities in distributed energy. The UK-based and Mitsubishi backed Ovo Energy this week won a retail licence to operate in Australia, and is expected to bring its focus on combining rooftop solar, battery and electric vehicle charging options for consumers.
Oil giant Shell is also looking to enter Australia’s electricity market, and has made an agreed bid for ERM Power, as it prepares for what it sees as the inevitable “electrification” of transport and manufacturing.

AGL’s Van Den Berg says the shift to EVs is inevitable, given the expected arrivals of more models, increased range, and when prices fall to the same ticket price of internal combustion engine cars, than the uptake will soar.
“Half of all new cars sales will be electric vehicles,” Van Den Berg said. “The principle of orchestrating a home battery is exactly the same as for a mobile battery. But when, where and how we charge is more complex.”
“We are looking at more than 7000MW (of storage) in system. That’s the equivalent of 28 open cycle gas turbines,” she said. “In many respects we have got to manage these assets in the same way as we manage gas assets.”
To illustrate the point about the so-called “shared economy”, and how it applies to the energy industry, Van Den Berg gave this example of how that “orchestration” could work, how it allowing the utility to tap into the household battery resource, and how it could allow the household to tap into high priced events.
“This is the approach of the shared economy business, the value of these assets is worth so much more with (connection and orchestration) than without,” she said. The graph above shows the benefits of using the battery in high prices events that could deliver extra revenue (maybe close to $300 a year) that would not be available otherwise.
In fact, AGL wants to be able to manage these assets in much the same way as it does larger assets on the wholesale market. One of the big targets will be the “solar duck curve” which is lowering demand and prices in the middle of the day.
Price variations are increasing and the company intends to use this price signal, and the need for dispatchable and flexible capacity as more coal plants exit the market, to invest in batteries and pumped hydro power station.