Promoting “Green Growth” in the Development Conversation

Last week, an audience at the Wilson Center heard new recommendations from the World Bank on how to get countries to grow green. Their report, titled Inclusive Green Growth: The Pathway to Sustainable Development, calls on governments to “think green when pursing growth policies which can be inclusive, efficient, affordable, and necessary to sustain economic expansion in the years ahead.” It makes the point that sustainable growth is critical to meeting the needs of developing nations, and that unsustainable growth will lead to greater socio-economic problems if environmental and social considerations are not accounted for.

The World Bank’s “Inclusive Green Growth” model recommends using more than just a nation’s Gross Domestic Product (GDP) to evaluate its economic growth. It requires using “case-by-case analysis” to minimize short-term costs and promotes enacting “well-designed” regulations to encourage private-sector development that still protects the environment. The World Bank explicitly states that “green growth is not anti-growth,” and presents a plan that implements policies which will allow for greater development that is also “greener” development.

The model that the World Bank has developed focuses on three main pillars to achieving sustainable development: economic, social and environmental sustainability. Economic sustainability requires tailoring a country’s sustainable development strategies to specific circumstances. Meanwhile, social and environmental sustainability encourages sound decision-making by stakeholders in the hopes of building better partnerships between the public and private sectors to meet “up-front capital needs with innovative financing tools.” This recent report by the World Bank highlights how environmental and sustainable growth will be the key to generating a more prosperous and sound world economy. The Inclusive Green Growth project is so important because it points out the need to change our attitude and approach international development efforts moving forward.

Click here to view the video from the event.

Posted By: Jonathan Sherman

Sources: The World Bank

Photo Credit: 24 Solar Panels courtesy of Flickr user Michael Coghlan

Guest Contributor Michael Darden: The State of Brazilian Innovation

Brazil, once a sleepy colony, has now grown into what is today the eighth largest economy in the world; and is projected to become the fourth largest by 2040.  Driven in part by the enormous appetite for commodity goods by China and India, Brazil owes much of its current economic and social success to political will and growing domestic demand.

As it stands now, Brazil is home to some of the world’s largest companies; Vale, which produces iron ore, beverage giant AB InBev, which recently purchased Anheuser-Busch, and oil giant Petrobras, which is leading the way in deep-sea drilling and exploration.  These titans of industry have become the face of a Brazil that is expanding its political and economical footprint across the globe.  While these corporations are the face of corporate Brazil, they do not tell the whole story of Brazilian innovation.

Brazil’s improving state of innovation can best be illustrated through a number of case studies.  After the oil crisis last century Brazilian manufacturers adapted.  As a result Brazilian car manufacturers now rely on “flex” engines, in which a single, or combination, of ethanol or standard fuel can be used.  In the month of October 2010, 89 percent of new cars sold in the country featured flex engines.  These flex cars take advantage of the fact that Brazilian sugarcane-based ethanol is six times more efficient than corn-based ethanol produced in the United States, due to the use of genetically modified sugarcane and its widespread access.

Book Launch: The Day After Tomorrow: A Handbook on the Future of Economic Policy in the Developing World

Economists Otaviano Canuto and Marcelo Giugale pointed to a major shift in the world’s balance of economic power in their new book “The Day after Tomorrow: A Handbook on the Future of Economic Policy in the Developing World.” While developed countries face high unemployment, heavy public debt, and stagnant economies, developing countries have maintained the positive growth premium that emerged prior to the financial crisis. Moreover, the economists said they expect major emerging economies—while facing their own challenges—may become the new locomotives of the global economy.

In the aftermath of the economic crisis, Canuto and Giugale asked 40 of their World Bank colleagues to lay out their visions on how key economic policy issues will be dealt in the developing world within the next three to five years. The book resulted from this exercise revealed a reasoned optimism, based on sensible macroeconomic policies that have made developing countries resilient to the recession that engulfed advanced economies after the 2008 collapse of financial markets. Also, developing countries are integrating with each other and catching up technologically with advanced economies. Many are rich in natural resources that will remain in high demand.

Multimedia Now Available: The Day After Tomorrow

On December 16th the Brazil Institute and the Program on America and the Global Economy hosted a book launch for The Day After Tomorrow: A Handbook on the Future of Economic Policy in the Developing World by Otaviano Canuto and Marcelo Giugale.  The event can be viewed here and a pdf version of the book can be found here.

Posted by: PAGE Staff

Watch Live: The Day After Tomorrow: A Handbook on the Future of Economic Policy in the Developing World

The live webcast has now concluded.  Please check back for an archived video of the event.

The Day After Tomorrow: A Handbook on the Future of Economic Policy in the Developing World

Authors: Octavio Canuto, Vice President and Head, Poverty Reduction and Economic Management Network, The World Bank;  Marcelo Giugale, Director, Poverty Reduction and Economic Management for Latin America and the Caribbean, The World Bank

Discussants: Ajay Shankar, FICCI Scholar, Asia Program, Woodrow Wilson Center; Kent Hughes, Director, Program on America and the Global Economy, Woodrow Wilson Center

Moderator: Paulo Sotero, Director, Brazil Institute, Woodrow Wilson Center

The post-recession has been marked by a major shift in the world’s balance of economic power. While developed countries face high unemployment, heavy public debt, and stagnant economies, developing countries have managed to maintain the positive growth premium that emerged prior to the financial crisis. More and more, developing countries are integrating with each other and catching up technologically with advanced economies. Many have natural resources that will remain in high demand. With the United States and European Union still dealing with the consequences of the global meltdown and struggling to find the path back to vigorous and sustained growth, it is expected that major emerging economies, while facing their own social, economic and governance challenges, will be the main drivers of global growth in the years ahead.

Good economic management has shown that prosperity is possible in developing countries and does not need to be the privilege of the advanced economies as it has been in the past, according to World Bank economists Otaviano Canuto and Marcelo Giugale. In their new book to be presented on Dec. 16, Canuto and Giugale explain why the “rise of the rest” is not likely to be a temporary blip and argue that developing countries may become the locomotives of the global economy.

Posted by: PAGE Staff

You are Invited: The Day after Tomorrow: A Handbook on the Future of Economic Policy in the Developing World

The Brazil Institute and the Program on America and the Global Economy at the Woodrow Wilson International Center for Scholars

Invite you to a book launch:

The Day after Tomorrow: A Handbook on the Future of Economic Policy in the Developing World

Thursday, December 16, 2010 – 10 a.m. to 12:00 p.m.

Woodrow Wilson International Center for Scholars

5^th Floor Conference Room

RSVP (Acceptances only): renata.johnson@wilsoncenter.org

Authors: Otaviano Canuto, Vice President and Head, Poverty Reduction and Economic Management Network, The World Bank; Marcelo Giugale, Director, Poverty Reduction and Economic Management for Latin America and the Caribbean, The World Bank

Discussants: Ajay Shankar, FICCI Scholar, Asia Program, Woodrow Wilson Center; Kent Hughes, Director, Program on America and the Global Economy, Woodrow Wilson Center Moderator: Paulo Sotero, Director of the Brazil Institute, Woodrow Wilson Center

The post-recession has been marked by a major shift in the world’s balance of economic power. While developed countries face high unemployment, heavy public debt, and stagnant economies, developing countries have managed to maintain the positive growth premium that emerged prior to the financial crisis. More and more, developing countries are integrating with each other and catching up technologically with advanced economies. Many have natural resources that will remain in high demand. With the United States and European Union still dealing with the consequences of the global meltdown and struggling to find the path back to vigorous and sustained growth, it is expected that major emerging economies, while facing their own social, economic and governance challenges, will be the main drivers of global growth in the years ahead. Good economic management has shown that prosperity is possible in developing countries and need not be the privilege of the advanced economies as it has been in the past, according to World Bank economists Otaviano Canuto and Marcelo Giugale. In their new book to be presented on Dec. 16, Canuto and Giugale explain why the “rise of the rest” is not likely to be a temporary blip and argue that developing countries may become the locomotives of the global economy.

For more information on the Brazil Institute, visit www.wilsoncenter.org\brazil

Woodrow Wilson Center – 1300 Pennsylvania Avenue, N.W. – Washington, DC 20004

Posted by: PAGE Staff

Sustainable Biofuels: The Brazilian Experience and Opportunities Ahead

The Program on America and the Global Economy (PAGE) has sponsored, in partnership with the Wilson Center on the Hill and the Brazil Institute, a series of conferences over the growing importance and role of biofuels in the international market.  The conference, “Biofuels: Food, Fuel, and the Future?” was held in July to discuss the impact of ethanol production and development.  Following the conference, a subsequent publication of the same name was released, and in September, the event “Classifying Biofuels Subsidies” focused on the global trade impact of ethanol production.

The following summary is from the Brazil Institute’s event on sustainable biofuels held on November 10th.  The video archive of this event, and the presentations discussed therein, can be viewed here.

On Nov. 10, the Brazil Institute hosted a seminar on biofuels, energy demands, and their implications for global climate change viewed from a Brazilian perspective.  Ambassador André Amado, undersecretary-general for energy and technology with the Ministry of External Relations, discussed the benefits of biofuels, most specifically sugarcane ethanol.

Biofuels have stimulated economic growth in rural areas, as sugarcane production has increased– creating 835,000 jobs, 95 percent of which are in the formal sector.  This expansion has also had substantial labor input, improving the standard of living for many rural laborers.  Also, ethanol production has proven not to require subsidies and can fill gaps created by other renewable energy sources.  Most importantly, increased production of ethanol has occurred alongside a substantial increase in food production, allaying fears that food production would be displaced the biofuels expansion.  To further prevent this, Brazil recently passed agro-ecological zoning laws, which vastly restrict the amount of land that can be used for sugarcane production.

Ambassador Amado pointed out that the potential benefits to be gained from increased use in biofuels are an environmental incentive: the use of sugarcane ethanol over the past 30 years has saved 850 tones of carbon from being emitted.  As demand for energy increases due to economic development, more renewable resources will be needed to meet this demand in a responsible manner.  The current world energy matrix is less than 10 percent renewable, whereas in Brazil it is closer to 50 percent.  Politically, the bulk of the world’s petroleum resources are controlled by a small number of countries, giving them an enormous amount of leverage over world energy prices – a potentially dangerous situation.  Since sugarcane can be grown in so many parts of the world (over 100 countries), increasing the number of producers would be geostrategically advantageous.  In conclusion, he pointed out the remaining barriers to bioethanol becoming a world commodity– chiefly, the lack of international cooperation and the threat to vested business interests that this new industry represents, namely the oil, food, and car industries.