I come back from Kenya. AFD and other donors including the World Bank and EIB are financing a large-scale public geothermal investment program that will supply most of Kenya’s future power generating capacity. The power generation mix that will fuel Kenya’s rapidly growing economy over the next decade will be carbon-poor.
The magnificent landscapes of the Rift Valley where Kengen, the Kenyan Power company famous for its clean power plants, has laid a pipe system to harness geothermal steam made me reflect on our global actions to fight environmental degradation and global warming. I became convinced that the development community’s response falls short of what is needed to address the global environmental crisis while increasingly efficient tools are now available to meet the colossal challenges at hand.
We come a long way in matters of environmental protection. For a long time, the international community’s response to these challenges was hampered by the lack of consensus on the theoretical foundations, the scarcity of effective operational tools and the absence of an international governance structure to coordinate natural resource management initiatives on a global level.
In very recent years, however, it seems that we’ve reached a turning point, starting with the publication of several studies that succeeded in integrating environmental issues with mainstream economic analysis. The World Bank’s “Where is the Wealth of Nations?” made the case that the poor countries’ natural resources are an essential part of their national wealth and must be developed and protected accordingly. The Millennium Ecosystem Assessment directly linked environment and economic development, while stressing that environment degradation could jeopardize the very foundations of economic growth, with the poor being the first victims; the Intergovernmental Panel on Climate Change (IPCC) provided quality estimates of the effects of climate change at the regional and global levels; and in his report, Sir Nicholas Stern set out the cost of inaction: the inability of the international community to invest each year 1% of global GDP towards reducing carbon emissions could result in shrinking the world economy by 20% due to global warming.
Long considered by our economic growth models as exogenous factors, environmental constraints have today become part and parcel of our analytical framework for development. We now have at our disposal the scientific foundation needed to mobilize political commitment, as well as increasingly efficient tools to address the delicate junction between socioeconomic development and environmental protection in the world’s poorest countries.
Desertification, soil degradation, depletion of wells: we know that the poorest countries (and the most vulnerable population within them) are the first to suffer from climate change and environment degradation. Various coping mechanisms and safety net tools have been developed, and I believe that we are still at a very early stage in designing projects to protect vulnerable populations against climatic changes. The needs of our developing partners are such that it is vital that we develop much farther our ability to supply the appropriate assistance.
Today the first to suffer from the consequences of environmental degradation, the developing world will tomorrow become a leading cause of global environmental degradation, as its economies catch up and its populations grows. For instance, China appears to have replaced the US as the leading producer of greenhouse gas. We must be aware of the serious threats looming over mankind if emerging economies follow the industrialization path adopted by developed economies in the nineteenth century. And the threat does not come from emerging economies alone: with its rapidly growing population and economic recovery, Africa will also contribute to an accelerating global warming. Fighting CO2 emissions is now a global concern, including for the poorest countries. We cannot afford to artificially separate the environmental strategic agenda between adjustment for poor countries and mitigation for the sole developed and emergent economies. North-South international cooperation initiatives, such as the clean development mechanism proposed under the Kyoto Protocol, encourages enterprises in developed countries to help actors in developing countries reduce their environmental footprint. Development assistance also plays a critical role through the priority financing of clean energy projects and increased urban development investments needed to confront the challenges raised by the mushrooming poor and energy inefficient megalopolis. Despite their considerable results, these projects remain too limited to be significant at the global level, which is the one that counts for global public goods.
I am also convinced that some of the poorest countries will be part of the solution to the global environmental crisis. A handful of developing countries are the custodians of tropical forest ecosystems that, among other essential services to mankind, sequester carbon and protect biodiversity. Promising methods and technologies have been developed to enable these countries to effectively manage both their economic development and their role in safeguarding the world’s heritage. Direct payment for ecological services programs are becoming increasingly popular (e.g., in Costa Rica), and offer, I believe, promising perspectives on the way to collectively organize the protection of global environmental resources that are essential for the future of our planet, including the fight against deforestation. This is also an area where ODA plays a pioneering role in financing forest, water and soil protection programs while innovative global mechanisms are being developed.
If we now have solid theoretical foundations and efficient operational tools to simultaneously meet the needs of economic development and environment protection, are we then on the right track to address what I called earlier the “global environmental crisis”? It seems to me that we still have a long way to go. Trapped in the “tragedy of the commons”, we are missing an essential pillar of a world-wide collective action agenda, i.e. an international environment governance system that could scale-up successful projects and ensure their significant impact at the global level.
At the blog’s launch, Pascal Lamy shared his hope to see it become a forum for the sharing of successful (and less successful) development experiences. Today, global environmental protection is indeed an area that would most benefit from the exchange of new ideas and promising experiences. I believe that payments for ecological services, insurance and other adaptation mechanisms to assist populations most exposed to environment degradation, successful management of soaring urban growth and clean development mechanisms that bring together actors from both developed and developing countries, are all promising avenues that we must pursue concurrently.