Toward a Green, Clean, and Resilient World for All A World Bank Group Environment Strategy 2012 – 2022 THE WORLD BANK Toward a Green, Clean, and Resilient World for All A World Bank Group Environment Strategy 2012 – 2022 © 2012 The World Bank Group 1818 H Street, NW Washington, DC 20433, U.S.A. Telephone: 202-473-1000 Internet: www.worldbank.org/environment E-mail: feedback@worldbank.org All rights reserved. First printing May 2012 This volume is a product of the staff of the World Bank Group. The findings, interpretations, and conclusions expressed in this volume do not necessarily reflect the views of the Executive Directors of The World Bank Group or the governments they represent. The World Bank Group does not guarantee the accuracy of the data included in this work. 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Contents Abbreviations and Acronyms............................................................................................. v Acknowledgments............................................................................................................. vi Executive Summary ........................................................................................................... 1 A New Environment Strategy, a New Vision....................................................................... 7 An Environment under Assault.........................................................................................11 How Green Is Our World? ................................................................................................................. 13 How Clean Is Our World? .................................................................................................................. 16 How Resilient Is Our World?.............................................................................................................. 19 Tough Questions for a Changing World............................................................................................. 19 Coming Together to Transform Challenges into Opportunities........................................ 21 Global Efforts and Country Efforts Catalyzing Action...................................................................... 21 Assessing the World Bank Group’s Current Contributions............................................................. 24 World Bank Group Support for the Green Agenda.......................................................................................... 26 World Bank Group Support for the Clean Agenda.......................................................................................... 28 World Bank Group Support for the Resilience Agenda—Adaptation............................................................. 33 Lessons Learned and Voices Heard................................................................................. 39 What Have We Learned?.................................................................................................................... 39 Voices of Our Stakeholders .............................................................................................................. 43 From Vision to Action....................................................................................................... 47 Supporting the Environmental Pillar of Sustainable Development and the Green Agenda............ 47 Valuing Ecosystems, Emphasizing Oceans, Protecting Biodiversity............................................................. 48 Policies to Remove Barriers to Green, Clean, and Resilient Growth............................................................ 53 Market-based Mechanisms and Sustainable Supply...................................................................................... 53 Updating and Consolidating the Safeguards................................................................................................... 54 Supporting the Clean Agenda............................................................................................................ 55 Finding Answers, Providing Resources in the Fight against Pollution......................................................... 55 Ramping Up Support for Low-Emission Development................................................................................... 58 Carbon Finance.................................................................................................................................................. 60 Climate Finance................................................................................................................................................. 62 Understanding and Managing the World Bank Group’s Environmental Impact........................................... 63 Supporting the Resilience Agenda.................................................................................................... 64 Strengthening the Focus on Disaster Risk Management............................................................................... 64 Strengthening Climate Adaptation Initiatives, Targeting Agriculture........................................................... 65 Opening Doors to Knowledge and Learning.................................................................................................... 66 Small Island States: Microcosms for Green, Clean, and Resilient Development......................................... 68 Environmental Actions and Commitments from World Bank Group Regions.................. 71 Africa.................................................................................................................................................. 71 The Green Agenda in Africa...............................................................................................................................71 The Clean Agenda in Africa............................................................................................................................... 72 The Resilience Agenda in Africa....................................................................................................................... 73 East Asia and the Pacific .................................................................................................................. 74 The Green Agenda in East Asia and the Pacific.............................................................................................. 75 The Clean Agenda in East Asia and the Pacific............................................................................................... 75 The Resilience Agenda in East Asia and the Pacific........................................................................................76 Europe and Central Asia.................................................................................................................... 76 The Green Agenda in Europe and Central Asia................................................................................................76 The Clean Agenda in Europe and Central Asia................................................................................................76 The Resilience Agenda in Europe and Central Asia........................................................................................ 77 Latin America and the Caribbean..................................................................................................... 78 The Green Agenda in Latin America and the Caribbean................................................................................ 78 The Clean Agenda in Latin America and the Caribbean................................................................................. 78 The Resilience Agenda in Latin America and the Caribbean......................................................................... 79 Middle East and North Africa............................................................................................................ 80 The Green Agenda in the Middle East and North Africa................................................................................. 80 The Clean Agenda in the Middle East and North Africa................................................................................. 80 The Resilience Agenda in the Middle East and North Africa......................................................................... 82 South Asia.......................................................................................................................................... 82 The Green Agenda in South Asia...................................................................................................................... 82 The Clean Agenda in South Asia....................................................................................................................... 84 The Resilience Agenda in South Asia............................................................................................................... 84 From Actions to Results................................................................................................... 87 Results Measurement....................................................................................................................... 87 Implementation Risks........................................................................................................................ 87 Annex 1: Actions by World Bank Group Sectors Addressing Environmental Sustainability ....................................................................... 96 References..................................................................................................................... 100 Abbreviations and Acronyms BioCF T3 BioCarbon Fund Tranche 3 IPCC Inter-Governmental Panel on Climate Change C Celsius LAC Latin America and the Caribbean CCKP Climate Change Knowledge Portal LULUCF land use, land use change, and forestry CDM Clean Development Mechanism MDB multilateral development bank CEA Country Environmental Analysis MENA Middle East and North Africa CI-Dev Carbon Initiative for Development MIGA Multilateral Investment Guarantee Agency CIFs Climate Investment Funds MRV monitoring, reporting, and verification CITES Convention on International Trade in Endangered Species of Wild Fauna and Flora MSME micro, small, and medium-size enterprises CO2 carbon dioxide MW megawatt COP Conference of Parties NAMA Nationally Appropriate Mitigation Action CPF Carbon Partnership Facility NGO nongovernmental organization CTF Clean Technology Fund OECD Organisation for Economic Co-operation and Development DDT dichlorodiphenyltrichloroethane PCB polychlorinated biphenyl DPL development policy loan PMR Partnership for Market Readiness EAP East Asia and the Pacific POPs persistent organic pollutant ECA Europe and Central Asia PPCR Pilot Program for Climate Resilience EEZ exclusive economic zone REDD+ reducing emissions from deforestation and EITI Extractive Industries Transparency Initiative forest degradation + ENRM environment and natural resources SAR South Asia Region management SFDCC Strategic Framework on Development and ESE environmental and social effects Climate Change EU European Union SEGOM Sustainable Energy, Oil, Gas and Mining FAO Food and Agriculture Organization of the SLCF short-lived climate forcers United Nations SLM sustainable land management FCPF Forest Carbon Partnership Facility SREP Scaling Up Renewable Energy Program FI financial institution UNFCCC United Nations Framework Convention on FY fiscal year Climate Change GCF Green Climate Fund UNDP United Nations Development Programme GDP gross domestic product WAVES Wealth Accounting and the Valuation of GEF Global Environment Facility Ecosystem Services GHG greenhouse gas WBG World Bank Group GNI gross national income GTI Global Tiger Initiative IBRD International Bank for Reconstruction and Development ICT Information and Communications Technology IDA International Development Association IEG Independent Evaluation Group All dollar amounts are US dollars and all tons are metric IFC International Finance Corporation tons, unless otherwise indicated. 2012–2022 | A World Bank Group Environment Strategy v Acknowledgments The process of preparing this 2012–2022 Bucknall, Michael Peter Jacobsen, Peter O’Neill, Environment Strategy involved a wide range of Andreas Kopp, Marc Juhel, Marcus Lee, Dan contributors, including development partners, Hoornweg, Clive Armstrong, Robert Lesnick, Alan government representatives, civil society organiza- Miller, Robin S. Horn, Doyle Gallegos, Alexander tions, think tanks, private sector representatives, McPhail, and Laurent Besancon. and academics from developed and developing countries, as well as World Bank Group staff from This strategy was prepared jointly by a team of across the institution. Focal points from World World Bank, IFC, and MIGA staff and consultants Bank Group regional and sector teams were under the leadership of Mary Barton-Dock appointed to organize and hold consultations with (Environment Director) and Sari Söderström stakeholders and to participate in discussions on Feyzioglu (Environment Sector Manager) and environmental priorities. previously James Warren Evans (former Environment Director) and Michele de Nevers Externally, a series of 66 consultations were orga- (former Environment Senior Manager). Bilal Rahill nized from October 2009 through June 2010, with (Senior Manager, IFC Environment, Social and the support of key partners in a number of venues. Governance Department) and Deniz Baharoglu These consultations allowed us to engage with more (Sector Leader, MIGA Economics and Policy Group) than 2,300 stakeholders from various countries. In coordinated inputs for IFC and MIGA, respectively. addition to the face-to-face consultations, stake- holders provided comments through the Valuable guidance and oversight were provided Environment Strategy website, translated to all by Rachel Kyte (Vice President, Sustainable official World Bank languages. More than 73,000 Development Network), Inger Andersen visits were received. (Vice President, Middle East and North Africa), Hartwig Schafer (SDN Operations Director), and All members of the Environment Sector Board played Marianne Fay (SDN Chief Economist), with the an active role in the strategy preparation process: valuable support of Anke Reichubber, Doreen Charles Di Leva, Jasmin Mason-Andersen, Herbert Kibuka-Musoke, Koshie Michel, Wisambi Loundu, Acquay, Idah Pswarayi-Riddihough, Joelle Chassard, and Ewa Sobczynska. John Kellenberg, Kulsum Ahmed, Karin Kemper, Kenneth Chomitz, Hoonae Kim, Magda Lovei, The Task Team Leader for preparation of the Michael Toman, Neeraj Prasad, and Patricia Miller. Strategy was Yewande Aramide Awe. The Strategy drafting group, led by Elisabeth Mealey, included There was close collaboration with and contributions Laura Tlaiye, Yewande Aramide Awe, Habiba Gitay, from colleagues from the sector departments: Fernando Loayza, Valerie Hickey, Klas Sander, Jamal Saghir, Lucio Monari, Masami Kojima, Yves Prevost, Hannah Behrendt, Urvashi Narain, Marjory-Anne Bromhead, Mark Cackler, Julia Giovanni Ruta, Alejandra Alvarez, and Kazi Fateha vi Toward a Green, Clean, and Resilient World for All Ahmed from the World Bank and Edmond Mjekiqi Ari Huhtala, Konrad von Ritter, Kanta Kumari and Elizabeth White from IFC. Rigaud, Dahlia Lotayef, Alaa Sarhan, Craig Meisner, and Ana Goicoechea. The Task Team Leaders for the preparation of background papers were Anjali Acharya, Nilufar External consultations on the Concept Note for the Ahmad, Sameer Akbar, Yewande Aramide Awe, Strategy were led by Jeff Brez. Logistic and multi- Judith Moore, Glenn-Marie Lange, Helena Naber, media support for consultations was provided by Urvashi Narain, Juan David Quintero, Giovanni Amanda MacEvitt and Alejandra Alvarez. Editorial Ruta, Ernesto Sánchez-Triana, Klas Sander, and support was provided by Bob Livernash, Clare Claudia Sobrevila. Fleming, Hilary Gopnik, Linda Starke, and Jim Cantrell. Administrative and logistical support was Additional important contributions to the provided by Grace Aguilar, Sharon Esumei, Liudmila Environment Strategy were made by Jane Ebinger, Mazai, Alexandra Sears, Regina Vasko, Patricia Noel, Karin Shepardson, Benoit Bosquet, Astrid Hillers, Nyambura Thande, and Juliette Makandi Guantai. Juan Carlos Belausteguigoitia, Stephen Lintner, Pathmanathan Gajanand, Peter Kristensen, Paula We thank the Governments of Denmark, Finland, Posas, Christophe Crepin, Nancy Chaarani Meza, Norway, and the United Kingdom and the World Tracy Hart, Dominique Kaiser, Nina Chee, Tashi Bank Group Gender Action Plan Trust Fund for their Tenzing, Mona Sur, Philippe Ambrosi, Patricia financial support, which made the consultations and Bliss-Guest, Siv Tokle, Avjeet Singh, Klaus Lorch, background analytical work possible. 2012–2022 | A World Bank Group Environment Strategy vii Executive Summary The new Environment Strategy for the development. Rural women no longer spend their World Bank Group lays out an ambitious days hauling wood because they have access to action agenda that seeks to respond to cleaner fuels. Cleaner production standards spur calls from our client countries for a new kind of innovation, and industry is encouraged to innovate development path—one that supports growth for new, clean technologies that provide jobs and while focusing more on sustainability and ensuring support export-led, sustainable growth. Companies that the environment is a key enabler for green, and governments are held to account on their more-inclusive growth. low-emission, low-pollution commitments, and innovative financing helps spur change. Based on extensive consultations with more than 2,300 Bank Group stakeholders throughout the “Resilient” means being prepared for shocks and world, this Strategy articulates a new vision for adapting effectively to climate change. In a resilient A Green, Clean, and Resilient World for All. world, countries are better prepared for more-frequent natural disasters, more-volatile weather patterns, “Green” refers to a world in which natural resources, and the long-term consequences of climate change. including oceans, land, and forests, are sustainably Healthy and well-managed ecosystems are more managed and conserved to improve livelihoods and resilient and so play a key role in reducing vulner- ensure food security. It’s a world in which healthy ability to climate change impacts. Climate resilience ecosystems increase the economic returns from the is integrated into urban planning and infrastructure activities they support. Growth strategies are development. Through effective social inclusion focused on overall wealth rather than gross domestic policies, countries and communities are better product (GDP) as it is currently measured. prepared to protect vulnerable groups and fully Governments pursue regulations that encourage involve women in decision making. innovation, efficiency, sustainable budgeting, and green growth. Biodiversity is protected as an The green, clean, and resilient agendas are comple- economically critical resource. In this world, good mentary, and by pursuing them in concert, countries policies enable the private sector to use natural can harness their co-benefits. resources sustainably as part of good business, creating jobs and contributing to long-term growth. Threats to the Environment “Clean” refers to a low-pollution, low-emission world Are Threats to Development in which cleaner air, water, and oceans enable people to lead healthy, productive lives. It is a world where The new Strategy recognizes that despite the development strategies put a premium on access progress made in reducing global poverty, there has alongside options for low-emission, climate-smart been significantly less progress in managing the agriculture, transport, energy, and urban environment sustainably. Pollution, overexploitation 2012–2022 | A World Bank Group Environment Strategy 1 of fish stocks, biodiversity loss, and overuse of water environmental and social safeguard policies and and land increasingly threaten countries’ devel- performance standards are vitally important in opment efforts. The immediate and long-term avoiding, mitigating, or managing risks and impacts consequences of climate change—from a warmer from operations. Evolving Bank work on the safe- planet to more-acidic oceans—further threaten guards policy will complement this Strategy when progress on poverty reduction and development. complete. The need for improved measurement of integration of environmental considerations into Environmental degradation, pollution, or overexploi- activities in sectors from agriculture to energy and tation of a natural resources hamper economic beyond is also clear. Increasingly, partnerships have progress. Lack of action to address health-impairing become essential in a fiscally constrained world faced air and water pollution, for example, is costing some with major environmental challenges. There is also a countries the equivalent of 4 percent of GDP or more growing role for the private sector in addressing a year. Policy failures account for many perverse sustainability concerns, developing sustainability incentives in the efficient use of natural resources, standards, and ensuring that global markets can and and without strong institutions and governance do promote sustainable development. The private frameworks in place, taking action to reduce envi- sector is also being recognized for helping to fill ronmental risks has a low chance of success. funding gaps, with multidonor facilities like the Global Environment Facility and the Climate The current economic model, driven by unsus- Investment Funds now including allocations to tainable patterns of growth and consumption, is catalyze and promote private sector climate activities. clearly putting too much pressure on an already stretched environment. Current unsustainable and inefficient growth patterns highlight the need for Priorities for Action inclusive green growth. The new Strategy prioritizes action in seven key areas across the green, clean, and resilient agendas. Building on Progress and Drawing on Lessons from Green Agenda: Our focus here is on nurturing 10 Years of Action greener, more-inclusive growth and poverty reduction while protecting biodiversity and This Strategy builds on the progress made through ecosystems. the World Bank’s 2001 Environment Strategy, which ■■ Through the Wealth Accounting and Valuation emphasized linking poverty reduction and the of Ecosystem Services global partnership, we will environment, integrating environmental actions into support countries valuing their natural capital economic sectors, and linking local with global assets like forests, coral reefs, and wetlands and environmental agendas. In 2001, the Strategy incorporating them into their systems of national focused specifically on the World Bank. This accounts. This truer measurement of national Strategy covers the work of all World Bank Group accounts will lead to better decisions in managing institutions, including the International Finance economies sustainably. Corporation and the Multilateral Investment ■■ Through the new Global Partnership for Guarantee Agency. It also ensures that the environ- Oceans , we will work with a broad coalition of mental commitments of World Bank Group governments, international agencies, nongovern- sectors—as outlined in sectoral strategies such as mental organizations, and private companies to water supply and sanitation, information and find ways to restore the world’s oceans to health communications technologies, urban development, and economic productivity. Healthy and biodi- transportation, and energy—are fulfilled. verse oceans are essential for food security, jobs, and the sustainable quality of life on earth. Many lessons have been learned since 2001. Key Managing ocean resources better can be a source among these is that the World Bank Group’s of green and inclusive growth for many countries. 2 Toward a Green, Clean, and Resilient World for All Under the green agenda, we will also build on our ■■ Pollution Management: With our clients facing experience in carbon finance to test the market’s increasing air, water, and soil pollution as well as willingness to encourage protection of critical the challenges of legacy pollution, we will foster a habitat areas while also providing carbon storage South-South exchange on best practice for benefits. With our partners, we will continue inno- managing pollution. We will work with our vative work on forests and land use linked to the partners and carbon finance funds to scale up use Reducing Emissions from Deforestation and Forest of cleaner stoves to help reduce indoor pollution Degradation program. We will also develop and benefit women and children. We will also methodologies to capture and monetize carbon work with countries on river cleanup and legacy co-benefits—for example, through wildlife pollution issues, and we will seek partnerships conservation premiums. with the private sector to work on cleaner production strategies. Clean Agenda: Our work on green growth ■■ Low-emission development strategies and cannot succeed without attention to the excessive innovative finance: We will work across Bank pressure being placed on clean air, clean water, Group regions and sectors to improve energy and productive land. Under the clean agenda, efficiency, encourage a shift to renewable we will focus on helping countries to manage energies, find climate-smart agricultural solu- pollution proactively and find low-emission tions, and build cleaner, lower-carbon cities. We paths to development. will continue to work to find innovative carbon 2012–2022 | A World Bank Group Environment Strategy 3 finance and climate finance solutions to help agriculture, mining, and human settlements, we are countries adopt low-emission paths to devel- giving priority to work on improved governance for opment and improve resource efficiency. better natural resource management alongside expanded protected areas management. In working Resilience Agenda: We will continue to work with to improve natural resources governance, the goal development partners and the private sector to help is to improve people’s food, income, and livelihood countries reduce their vulnerability to climate risks. security, while encouraging job-creating private ■■ Adaptation: We will support countries to find sector investment. In Europe and Central Asia , climate change adaptation solutions that add where forest resources are a major source of value to inclusive green growth, such as climate- employment, timber, and ecological services, smart agriculture or better coastal zone the Region is working on sustainable forest management. We will continue to develop management with an emphasis on strengthening innovative approaches to increasing climate governance and communities’ and private finance focused on adaptation. sector roles. ■■ Disaster risk management: We will work with countries to find ways to minimize the damage In the East Asia and Pacific Region, clean agenda of natural disasters in terms of loss of life and challenges include high greenhouse gas emissions, structural damage. This includes expanding air-polluted cities, and heavily polluted river systems. the use of financial instruments, like climate In response, the regional focus will be on expanding risk insurance, to help with recovery from work targeting greenhouse gas emissions and natural disasters. continuing to support investments in renewable ■■ Improving the resilience of small island energy and energy efficiency while making large developing states: We will continue our work urban and rural sanitation programs a priority. with small island developing states to help reduce Similarly, in the Middle East and North Africa their dependence on imported oil while Region increasing land, air, and marine-based supporting efforts to boost renewable sources of pollution is threatening cities, waterways, and energy. Through the International Development shared seas. The Region is working on a regional Association and the Pilot Program for Climate seas approach to pollution management with other Resilience, we will support projects to improve regional and development partners while also climate resilience in infrastructure and to reduce supporting countries to shift to cleaner sources of vulnerability through restoration of protective energy and find cleaner, smarter approaches to coastal ecosystems such as mangroves. industrial and urban development. In the Europe and Central Asia Region, clean agenda challenges Across all three agenda areas, we will promote work include ensuring energy security while providing to improve data collection and data quality, empha- cleaner energy and managing legacy, current, and sizing open access to data and knowledge. We will future pollution. In response, the Region is working work closely with clients on developing and dissemi- on enhancing energy supply with an emphasis on nating knowledge and promoting global learning clean energy options and on cleanup, containment, across the range of country circumstances. and remediation of land, ground, and water pollution. For most regions, the vulnerability of large coastal Regional Approaches populations and agricultural areas to the impacts of sea-level rise and more-intense weather, floods, and The Strategy also defines specific challenges and droughts is at the heart of their resilience agendas. approaches at the regional level across the green, In South Asia , for example, the regional focus is on clean, and resilient agendas. increasing the resilience of ecosystems, infra- structure, and highly vulnerable areas by, among For example, to support Africa with its green other efforts, helping to build the needed institu- agenda challenges linked to pressures from tions, capacity, and knowledge systems for mapping 4 Toward a Green, Clean, and Resilient World for All Shutterstock hazards and developing world-class coastal zone In responding to demands from clients and global management. The Latin America and Caribbean concerns, the Strategy will require continuous Region is boosting work in adaptation, mitigation, monitoring of progress. Implementing this Strategy and disaster risk management. A particular focus is will require adequate resources, both human and on the development of low-carbon growth strategies budgetary, to deliver on the ambitious vision in Mexico, Brazil, and Colombia. proposed. Helping client countries move toward green, clean, and resilient development will mean continuing to build our own skill sets and capacity. Mobilizing New Finance, Resourcing the Strategy This Strategy recognizes the importance of our convening power, access to policy makers, Across all three agendas—green, clean, and analytical work, development of new financial resilient—the goal of the Strategy is to demonstrate tools, and smart risk management as well as a how to mobilize additional sources of finance for portfolio of investments to accelerate solutions. green growth, biodiversity conservation, and Spreading these solutions by sharing knowledge, low-pollution and low-emission initiatives as well as demonstrating success, working in partnership, investments to build resilience to climate shocks. It mobilizing action, and leveraging financing will remain a high priority to support policy reforms, will be critical to our success. institution strengthening, and capacity building across all three areas. 2012–2022 | A World Bank Group Environment Strategy 5 Shutterstock 1 1 A New Environment Strategy, a New Vision The global fight against poverty over the past 20 years has seen remarkable success. On environmental issues, however, there has been far less progress. Though the world has won several the IFC. The WBG continues to step forward with initiatives on low-carbon development strategies, climate-smart agriculture, resilient cities, and a rebalanced energy portfolio. environmental battles, on a global scale we are still Global efforts to date are not enough to ensure losing the war: species are becoming extinct at a the future holds either a world free of poverty greater rate than ever, the world’s area of primary or a world that is biodiverse, sustainable, and forest cover continues to shrink each year, areas of only 2° Celsius (C) warmer. This prompts several key degraded land and polluted water are still questions. Can the world grow its way out of poverty increasing, and carbon emissions continue to rise. in an environmentally sustainable way? How can the Climate change is now having an increasingly planet support a population of 9 or 10 billion people? negative impact on development, contributing to How can the world finance a new model for growth volatile weather patterns with more-frequent natural along with the necessary adaptations to a warmer disasters like floods and droughts, which in turn planet? For its part, the WBG is working to develop a contribute to the volatile markets for food. It is now new vision of “Green Growth for All,” with each clear that as temperatures and the sea levels sector defining its own contribution to resolving continue to rise, worse is in store. Taken together, these questions with a focus on improving efficiency these environmental challenges constitute a signif- of resource use and patterns of production and icant development risk, imperiling the hard-won consumption. Underpinning this approach is a new successes in fighting poverty. Green Growth Knowledge Platform that aims to improve knowledge on how to promote more- The World Bank Group (WBG) strives to provide the sustainable patterns of growth and provide advisory leadership, solutions, and financing necessary to and operational services on growth and on environ- keep poverty reduction on track in the face of mental and social synergies. these challenges. In recent years, the WBG has played a pivotal role in climate finance by deepening In consultations for this Strategy, all WBG carbon markets and directing them toward new stakeholders said clearly that the world needs challenges, testing the Climate Investment Funds to rethink the current growth model and move (CIFs) in advance of the Green Climate Fund, toward greener development pathways. Concepts increasing private sector investment through the like “green growth” and the “green economy” climate business group of the International Finance recognize that growth is critical but that the current Corporation (IFC). The WBG is also innovating growth model’s ability to deliver on truly sustainable financial instruments, including testing green and development is in serious doubt. The concept of cool bonds and developing instruments for disaster sustainable development was given international risk management with IDA, the IBRD, MIGA, and credibility by the Brundtland Commission in 1987 in 2012–2022 | A World Bank Group Environment Strategy 7 an effort to integrate environmental, economic, and with regard to the environment. Getting prices social dimensions in development. While there has aligned with the true value of environmental been some progress on integrating the economic services globally and locally is an important first and social dimensions, there has been very little step. Other transitions involving infrastructure, progress in linking environmental and economic natural resource management, knowledge, considerations. Greener growth is needed to finally innovation, information and communications implement the original notion of sustainable technology, governance, institutions, and social development. Success will require properly capital are also critical and will require significant valuing natural capital and fully integrating investments, analytics, data, new institutions, and environmental issues into growth policies that financial instruments. promote efficiency, innovation, and resilience while continuing or stepping up efforts on job creation Since 2001, there has been considerable progress and poverty alleviation. in integrating environmental priorities across development sectors and regions within WBG Sustainable development with environment strategies. Annex 1 highlights the range of environ- properly integrated will require a number of mental actions that each of the sectors has transitions. The manner in which global markets committed to undertake. These range from and economies are currently structured often means increasing energy efficiency and investing in that people do not get paid for doing the right thing renewable energies to reducing land degradation 8 Toward a Green, Clean, and Resilient World for All through more-sustainable agricultural and water What do we mean by “clean”? Clean refers to a management practices and reducing urban air low-pollution, low-carbon world. This is a world in pollution. Chapter 6 reviews the efforts by each which cleaner air, land, water, and oceans enable World Bank region to address the world’s pressing people to lead healthy, productive lives. It is also environmental challenges. Chapter 7 outlines how a world in which cleaner production standards the progress of each region and sector on achieving spur innovation—whether through reducing air sustainable development will be monitored under pollution, addressing legacy pollution, or the Environment Strategy in 2012–22. encouraging recycling. It is a world in which industries are built around clean technologies— The WBG’s vision for this new Environment either for energy, water, transportation, or Strategy is a Green, Clean, and Resilient World housing—providing jobs, offering the potential of for All. This strategy recognizes that all economies, export-led growth, and contributing to sustainable particularly developing ones, still need to grow, economic development. It is a world in which the but they need to do so sustainably, so that clean technologies and production methods used income-producing opportunities are not pursued by the private sector meet or even exceed interna- in ways that limit or close off opportunities for tional standards—partly because of management future generations. choices, but also because regulation rewards clean technologies and because clients and investors What do we mean by “green”? Green refers to a seek it. It is a world in which governments and world in which natural resources are conserved and companies are held to account by people on their sustainably managed to improve livelihoods over clean performance. time. It is a world in which ecosystems (both green and blue) are healthy and increase the economic What do we mean by “resilient”? In a resilient returns from the activities they support—such as the world, countries manage the risks of disaster more fish-breeding and coastal protection services of effectively—especially the more-frequent natural coral reefs and the water filtering and soil protection disasters and more-volatile weather patterns. services of forests. Other vital ecosystem services They also lessen exposure to natural disasters by such as erosion regulation, carbon sequestration, anticipating shocks and adapting to both climate and pest control are supported and protected. change and climate variability. They are able to Subsoil assets are also leveraged to build other handle shocks because they have resilient forms of wealth, such as productive and human communities woven from a strong social fabric capital. In all of this, the private sector uses natural that stems from investment in women, in minorities, resources sustainably as part of good business, and in other vulnerable groups. Resilience also creating jobs and contributing to long-term growth. requires adaptation in dynamic societies focused on capacity building, on innovation, and on This is a world in which farmers receive payments knowledge management within a culture of actively for preserving sensitive ecological land and wildlife seeking solutions for recognized problems. In a habitats. It is a world in which ministries of finance resilient world, ecosystems are healthy and well are focused on overall wealth rather than gross managed, and they are a key part of reducing domestic product (GDP), while pursuing innovation, vulnerability to climate impacts. efficiency, and sustainable budgeting. 2012–2022 | A World Bank Group Environment Strategy 9 Shutterstock 2 2 An Environment under Assault With growing populations and increasing demand for food, water, energy, land, and other natural resources, the world faces a massive challenge in achieving a vision for a green, clean, and resilient The world’s population is not only larger today, it is more prosperous. The global population of 6.2 billion in 2002 had already grown to 7 billion by 2011, according to World Population Prospects: The 2010 Revision by the United Nations, and is development. Climate change, which is both an projected to reach 9.3 billion by 2050 (Figure 2.1). outcome and a driver of further environmental Alongside population growth over the past two degradation, presents a special set of challenges. decades, there have been tremendous gains in The accelerating impacts of climate change are prosperity. More people have escaped poverty over narrowing the options for sustainable development, the past 20 years than at any other time in human shortening the time frame for addressing poverty, history. Global trade has more than tripled since and requiring a move toward cleaner, more efficient 1992 (WTO 2011), while developing country GDP andFigure 2.1 equitable patterns of growth. has nearly doubled, allowing for a proportional World Population 1950–2100: Toward 10 Billion by 2100 Figure 2.1 World Population 1950–2100: Toward 10 Billion by 2100 12 World Population (in billions) 10 8 6 4 2 0 1950 1970 1990 2010 2030 2050 2070 2090 OCEANIA NORTH EUROPE LATIN AMERICA AFRICA ASIA AMERICA AND THE CARIBBEAN Source: United Nations Population Division 2011. 2012–2022 | A World Bank Group Environment Strategy 11 increase in consumption. This has led to improve- An expanding global economy has brought ments in access to education, health care, and increased prosperity but also environmental infrastructure services throughout the developing degradation. The growing manufacturing sector world. Overall, life expectancy improved from 64 has provided jobs and raised living standards. An years in 1990 to 68 years in 2009 (WHO 2011). expanding construction sector has provided critical infrastructure services, increasingly delivered by Yet hundreds of millions of people continue to the private sector. But the accompanying demand for live in poverty, and developing countries’ share of metal ores and nonmetallic minerals has created global income and consumption continues to be environmental issues. Weak or poorly enforced disproportionately low. Based on an expected regulations have allowed this growth to come at the developing country population of over 6 billion, expense of environmental degradation: runoff from more than 1 billion people will still be living in agriculture and mining activities has in some cases extreme poverty by 2015.1 And despite increases in polluted groundwater, adding to drinking water prosperity, developing countries, home to 84 percent problems; groundwater, coastal ecosystems, and of world population, still only account for about marine ecosystems have occasionally been quarter of global income and consumption. This threatened by oil and gas industry activities. means that the world is dealing simultaneously with Carbon-intensive and often polluting industries a dramatic contrast in environmental challenges— such as those for cement, glass, metals, food those posed by increasing prosperity and those processing, pulp and paper, and chemicals have associated with inequality and continuing large been allowed to grow with inefficient processes, numbers of poor people. contributing to climate change and freshwater resource depletion. Population growth and economic prosperity have been accompanied by a heavier human ecological Rapid urbanization has spurred growth, creating footprint. As incomes have grown, so has opportunities and challenges. Today, more than purchasing power and consumption of goods and half of the world lives in cities. Over 90 percent of services. Between 1992 and 2009, developing urban growth occurs in developing countries. countries saw an 80 percent increase in per capita According to the World Bank’s Urban and Local income, even as the global population grew by 1.2 Government Strategy (World Bank 2010d), the billion people. The growing demand for food has led urban share of a population rises sharply—from to more and more-intensive agriculture. In the about 10 to 50 percent—as countries move from 1980s, an average hectare of cropland produced 1.8 low- to lower-middle per capita incomes of about tons of food; now it produces 2.5 tons (UNEP 2007). $3,500 per year. These trends have profound implica- While critically important for food security, this tions for the local environments of cities and for the agricultural intensification has also contributed to global environment. The local environments of agrochemical pollution, soil exhaustion, and defores- many cities are affected by serious air and water tation. Water withdrawals have tripled over the last pollution. Urban sprawl leads to growth in built-up 50 years, largely through the rapid increase in areas at the expense of natural land cover and to an irrigation stimulated by food demand. This has urban heat island effect, in which temperatures in a contributed to water scarcity and groundwater city are significantly warmer than in surrounding depletion (World Bank 2007c). Demand for water is rural areas. Cities often draw heavily on resources, growing, with withdrawals projected to increase by such as freshwater, food, and energy coming from another 50 percent by 2025 in developing countries distant sources, including other countries, thus also and 18 percent in developed countries driving changes in land use and the environment at (UNESCO-WWAP 2006). Some researchers suggest the global scale. Yet cities, if planned and managed that the world has already exceeded its safe oper- well, are efficient energy and resource users as well ating space (Figure 2.2). as sources of innovation, jobs, and growth (World Bank 2010c). The challenge for governments and 1 Calculation based on Chen and Ravallion 2008 and on United Nations Population city mayors as well as citizens and firms is to create Division 2011. 12 Toward a Green, Clean, and Resilient World for All Figure 2.2 A Safe Operating Space for Humanity on Climate Change olluti fied) Ocea l p nti na ica t qua cid if (no hem t ye ica C tion ied) (not yet quantifng Stratos ozone Atmospheric aerosol load i depletion pheric Nitrog ss ity lo flow eochem hospho biog le P en cy bo i r rs c e u div ndar cal Bio y e fres land us hwa us Change in Glob ter use al Source: Rockström et al. 2009. In their 2009 article in Nature magazine, Rockström et al. looked at the human footprint on nine “planetary systems.” The inner green shading represents the proposed safe operating space for these systems. The orange wedges represent an estimate of the current position for each variable, with boundaries in three systems already exceeded. ecologically sound cities, improving the lives of programs can help transform markets and address citizens while greatly enhancing resource efficiency. environmental and social challenges. More than ever before, all development So what is the starting point for advancing a partners—public, private, and civil society—need green, clean, and resilient world? An assessment to come together to achieve sustainable growth. of the current status of our environment is sobering. Addressing the challenges for a green, clean, and resilient world requires leveraging the comparative advantage of all development partners. The combi- How Green Is Our World? nation of innovation, investment in technologies, sustainable management practices, and strong Biodiversity continues to decline. Over the past 40 regulations and enforcement has proved to have a years, there have been significant declines in positive impact on environmental outcomes and healthy ecosystems and their flora and fauna development. Expanding development partnerships populations. These losses have been accompanied such as public-private initiatives or integrated by major reductions in the extent and quality of vital 2012–2022 | A World Bank Group Environment Strategy 13 Shutterstock habitat—forests, mangroves, sea grass beds, and hectares between 2000 and 2010, despite declines in coral reefs (Butchart et al. 2010). This has seriously deforestation rates and increased forest plantations. affected ecosystem goods and services. While public Forest area gains have been made in temperate and attention has largely focused on well-known fauna boreal zones, while most of the losses are in tropical like tigers, pandas, gorillas, and polar bears, species regions (FAO 2010a), which are host to a wide range loss extends to everything from fungi to insects, of ecosystem services and biodiversity. Invasive plants, and frogs. According to the IUCN Red List of species (mammals, amphibians, fish, and plants) put Threatened Species, 875 plants and animals went additional pressure on native species and further extinct in 2008 (or extinct in the wild) and another degrade habitats. 17,291 are known to face a high risk of extinction in the wild (IUCN 2009). The current species Illegal wildlife trade is growing and is increas- extinction rate is 100 to 1,000 times the level it was ingly linked to organized crime. In 2009, legal trade before humans walked the Earth. Future extinction in wildlife exceeded $323 billion per year (TRAFFIC rates may be even 10 times greater if all currently n.d.). While exports of wood and other forest threatened species become extinct within the next products were estimated at $189 billion in 2009 century (Pimm et al. 1995). (FAO 2011), and exports of fish and fishery products reached a record $102 billion in 2008 (FAO 2010b), The primary driver of biodiversity loss is habitat the total value of illegal wildlife trade may exceed destruction and degradation. Both the extent and $20 billion per year (Wyler and Sheikh 2008). the quality of habitats are threatened by land use Poachers have become increasingly well organized change for increased food production through cattle and dangerous, and the Convention on International ranching, agriculture, and fishing (Butchart et al. Trade in Endangered Species of Wild Fauna and 2010). Forests have seen annual losses of 5.2 million Flora (CITES) and INTERPOL now state that 14 Toward a Green, Clean, and Resilient World for All poachers have close links to organized crime. Freshwater supplies are seriously stressed. Some Fragile states are particularly susceptible to wildlife 1.4 billion people live in river basins in which water crime by poachers who are well armed and may be use exceeds recharge rates. Rivers are drying up, demobilized soldiers or former rebels. groundwater tables are falling, and water-based ecosystems are being rapidly degraded (UNDP Ecosystem services are fractured. The rapid loss of 2006). By 2025, about two-thirds of the world’s biodiversity combined with shrinking habitats and population—some 5.5 billion people—will live in deteriorating ecosystem infrastructure, such as areas facing moderate to severe water stress forests and coral reefs, has fundamentally altered (UNESCO-WWAP 2006). ecosystems that generate an array of benefits: provisioning services such as food and water, regu- Oceans and shared seas are under stress from lating services such as flood and disease control, climate change, overharvesting, pollution, and cultural services such as spiritual and recreational coastal development. In tropical shallow waters, a activities, and supporting services such as nutrient temperature increase of 3°C by 2100 may result in cycling and carbon storage. Together, these services annual or biannual coral bleaching events starting maintain the conditions for life on Earth. While the in 2030. Even the most optimistic scenarios project use of ecosystem services is growing, the capacity of annual bleaching of 80–100 percent of the world’s ecosystems to provide these services has declined coral reefs by 2080 and a high probability of coral significantly. According to the Millennium Ecosystem mortality. Numerous studies of the impacts of coral Assessment (MA), 60 percent of ecosystem services bleaching have shown measurable effects on the are in worse shape than they were 50 years ago (MA structure of reef fish communities, including the 2005). One of the major reasons for this is the loss of herbivorous fish species that keep algae on systemic undervaluation of ecosystem services in reefs in check (Nature Conservancy 2011). Other countries’ national accounts. effects include declines in reef fish abundance linked to losses in the three-dimensional structure Land degradation is worsening. Soil erosion, of coral reefs and the associated loss of habitat for salinization, and nutrient depletion are all contrib- juvenile fish. uting to desertification and an increasing rate of land degradation. A 1991 global assessment of human- Ocean acidification—the result of excess carbon induced soil degradation found 15 percent of the dioxide (CO2) in the atmosphere, one-quarter of world’s land surface was degraded (Oldeman, which is absorbed by the oceans—is expected to Hakkeling, and Sombroek 1991). By 2008, a new severely damage coral reefs and is already assessment increased this estimate to 24 percent (Bai affecting shell-forming organisms. According to et al. 2008). Africa shows the fastest degradation rate, the U.S. National Oceanic and Atmospheric with 70 percent of the cultivated land area degraded Administration, ocean acidification is decreasing due to deforestation and poor agricultural practices. the ability of organisms to build their shells and In the Middle East and North Africa, land quality is progressively affecting the function of ecosystems threatened by poor water management and salini- (NOAA Ocean Acidification Steering Committee zation. Similarly, 25 percent of the land area in the 2010). Ocean acidification could trigger a chain Caribbean is severely degraded. reaction of impacts through the marine food web, beginning with larval fish and shellfish, poten- Land degradation is particularly acute in dryland tially affecting the global fishing industry and areas that account for some 40 percent of the world’s food security (Ocean Acidification Reference User land surface and are home to about 2 billion people. Group 2009). The 2010 U.N. General Assembly review of the Millennium Development Goals highlighted the lack At the same time, coastal development is of progress in reducing hunger and poverty in increasing rapidly. Development is projected to dryland areas, where well over half of the world’s affect 91 percent of all inhabited coasts by 2050 poor people live. and will contribute to more than 80 percent of all 2012–2022 | A World Bank Group Environment Strategy 15 marine pollution. The effects of pollution are exacerbated by the destruction of mangroves and How Clean Is Our World? other habitats as a result of rapid coastal devel- opment (Nellemann, Hain, and Alder 2008). The The poorest countries suffer directly and disposal of solid waste into marine environments is measurably from a polluted and degraded further pushing the limits of the ocean, which was environment, with women and children dispro- once thought to be vast and resilient. portionately affected. The World Health Organization notes that the top killers of children Fish stocks are under unprecedented pressure. under the age of five are acute respiratory infec- The 2010 report on the state of the world’s fish- tions (from air pollution), diarrheal diseases (from eries and aquaculture by the Food and Agriculture polluted water), and malaria (from inadequate Organization (FAO) estimated that more than half environmental management and vector control) of marine fish stocks are fully exploited, with (Prüss-Üstün and Corvalán 2006). Strikingly, the current catches at or close to maximum mortality rate in children under five from environ- sustainable production (FAO 2010b). Another mentally mediated disease conditions is 180 times one-third of stocks are estimated to be overex- higher in the poorest regions than in industrialized ploited (28 percent), depleted (3 percent), or regions. Because of variations in exposure to recovering from depletion (1 percent). Fishing environmental risks and access to health care, capacity is estimated to be 2.5 times sustainable developing regions suffer 15 times higher losses in harvest levels. As many shallow fishing grounds healthy life years from infectious diseases than are depleted, fishing fleets (especially large developed countries. industrial fleets) are increasingly targeting deep-water species on the continental slopes and In some regions and countries, air and water seamounts (Nelleman, Hain, and Alder 2008). pollution are increasing sharply, particularly in rapidly growing urban areas. Particulate matter The decline of marine resources threatens the concentrations in cities in lower- and middle- livelihoods of over 100 million men and women income countries are more than twice the levels in involved in fish processing. According to the high-income countries, affecting pregnant women, FAO, there are currently 35 million people children, and the elderly disproportionately. The working as capture fishers—90 percent of them in levels of particulate matter in Asia, Africa, and small-scale fisheries. Another 84 million people Latin America are substantively higher than in are estimated to be employed in associated Europe and North America, with Asia showing by occupations, particularly in seafood processing far the highest levels (WHO 2006). Meanwhile, and trading, and the majority of these are women. emissions of sulfur dioxide and mono-nitrogen Millions of other rural dwellers are involved in oxides are also increasing in developing countries. seasonal or occasional fishing activities. Taking While some developing countries have been able to into account the jobs that stem from ocean and decrease their air pollution concentrations over the waterfront tourism, conservatively 350 million last few years—for example, in cities in northern jobs are at stake if the living oceans falter. China average particulate matter concentrations Continued depletion patterns translate to severe dropped by about 35 percent between 2003 and livelihood setbacks for communities throughout 2009—the air quality in many cities in developing the world’s coastal and island nations. Equally countries is still deteriorating, notably in the concerning is that declining fish resources Middle East, Africa, and other parts of Asia. threaten an important source of dietary protein, Moreover, the gap is widening between the polluted micronutrients, and essential fatty acids for cities of the developing world and the cleaner cities millions of the world’s poor (FAO 2010b). Overall, in Europe and North America. Overall, the air seafood accounts for 15 percent of the world’s quality in most fast-expanding cities in developing protein, and it is the one source of protein that has countries is generations behind that of cleaner a zero carbon and freshwater footprint. cities in developed countries. 16 Toward a Green, Clean, and Resilient World for All Shutterstock Pollution also remains one of the most important especially in Asia, where they are the highest in the threats to water resources in developing countries. world, having almost doubled between 1990 and Each day, 2 million tons of human waste enters 2005 (AMAP and UNEP 2008). The manufacture global watercourses. Residual pesticides and metals and use of many persistent organic pollutants3 have also affect human health (UNESCO-WWAP 2006). been banned, but they persist in many land and More than 30 of the 47 largest rivers in the world are water systems and also accumulate in food chains under threat from pollution and drawdown, affecting (UNEP 2007). biodiversity and human water security (Vörösmarty et al. 2010). The most common freshwater quality Although the concentrations of some POPs, such as problem is high concentrations of nutrients (mainly DDT, have decreased, in many regions (such as phosphorus and nitrogen), resulting in eutrophi- sub-Saharan Africa) large stockpiles of obsolete cation that depletes waterways of oxygen, causing pesticides still exist. These stockpiles, which are the death of fish and invertebrates. With increasing often leaking, are up to 40 years old and contain use of fertilizers on food crops over the next 30 banned pesticides. The legacy from contaminated years, a 10–20 percent global increase in river industrial and urban sites, common in many nitrogen flows to coastal ecosystems is expected developed countries, is also a major problem. With (UNEP 2007). the increase in solid waste and waste exports from developed to developing countries, this burden is Heavy metals and persistent organic pollutants likely to increase. (POPs) continue to cause problems for many countries. Chemical wastes from industry and Carbon dioxide emissions continue to rise. After a agriculture are a big source of contamination in dip in 2009, CO2 emissions climbed to a record high developing countries. These chemicals affect human in 2010, with an additional increase of 5 percent from and animal health, water supplies, and land. They the previous record year, 2008 (IEA 2011a). This is include heavy metals, such as mercury, 2 and organic almost 40 percent more than 1990 levels, making pollutants. Mercury levels continue to increase, 3 POPs include aldrin, chlordane, DDT, dieldrin, endrin, heptachlor, hexachlorobenzene, 2 The main sources of mercury from human activity are mining, fossil fuel extraction, mirex, toxaphene, the industrial chemicals hexachlorobenzene and polychlorinated and waste incineration. Products such as batteries and electrical goods also contain biphenyls (PCBs), and polychlorinated by-products (Stockholm Convention on mercury and contribute to the leakage from solid waste disposal sites. Persistent Organic Pollutants 2011). 2012–2022 | A World Bank Group Environment Strategy 17 Shutterstock the globally agreed target for 2100 of 2ºC warming As the world approaches 3–4°C above preindustrial even more of a challenge. levels, the risk of catastrophic losses increases dramatically: droughts, floods, forest fires, and heat The world is on a path to an average waves will increase in both frequency and intensity. temperature rise of at least 2°C above Agricultural and forest productivity are expected to preindustrial levels—and possibly 5° or decrease in most parts of the world. Sea-level rise more in the worst-case scenario—by the end could exceed one meter by the end of the century, of the century (IPCC 2007, World Bank 2010f). and destabilization of the Greenland and Antarctic The accompanying changes in sea level, rainfall ice sheets would further commit the planet to tens of patterns, glacial retreat, and frequency and meters of sea-level increase in the future. intensity of extreme weather events threaten to erode development gains of the past 20 years. Geographically, these impacts will increase in scale over time. By 2050, the number of malnourished At 2°C above preindustrial levels, 20–30 percent children in South Asia could rise from 52 million of the world’s species may be at risk of extinction. (without climate change) to 59 million (with climate One billion more people (particularly in Asia and change) (Nelson et al. 2009). By 2080, agricultural Africa) are likely to experience severe water stress. land with severe soil or climate constraints in Declines in agricultural productivity could expose sub-Saharan Africa could increase by between 26 several hundred million additional people to risk million and 61 million hectares (Fischer et al. 2005). of hunger. Coral reefs will be devastated worldwide. And the homelands of tens of millions of people The growing inevitability of at least some of these will be flooded.  impacts is narrowing options for responding to the 18 Toward a Green, Clean, and Resilient World for All world’s environmental challenges. Climate change affects middle-income countries (World Bank and increases the urgency of the overall environmental UN 2010). agenda: to avoid catastrophic losses and address the impacts of temperature change, we will need to act Women and children are affected the most by quickly and decisively. disasters. They are 14 times more likely than men to die during a disaster and are more likely to suffer from post-disaster violence. Disasters place an How Resilient Is Our World? undue burden on women and girls, who are respon- sible for providing care, water, and food for their Climate change will increase the vulnerability of households (World Bank and UN 2010). human and natural systems. The economic costs of climate change and climate variability will be large, Exposure to hazards is expected to rise in cities and making it even more challenging to address issues of small island states. Although there is a lot of uncer- poverty and environmental degradation. According tainty surrounding climate projections, most climate to the World Bank’s Economics of Adaptation to models predict an increase in the intensity of tropical Climate Change study, it will cost developing coun- storms. Expected annual damage from climate- tries $70–100 billion a year in 2010–50 to adapt to change-induced tropical cyclones alone could run into climate change (World Bank 2010a). Since most tens of billions of dollars, with small island states being infrastructure is located in urban areas, and given the particularly vulnerable. Rapid urbanization, particu- greater concentrations of people there, cities are larly along coastlines, will also increase exposure to particularly vulnerable to climate change impacts. hazards (World Bank and UN 2010). Countries and cities will need considerable help to find the funds to adapt to a riskier and more volatile world. Adaptation will require a different kind of Tough Questions for a development that entails actions like breeding crops Changing World that are drought- and flood-tolerant and climate- proofing infrastructure. Loss of livelihoods, assets, The current economic model, driven by unsus- and income has wide implications for people and tainable patterns of growth and consumption, is economies. For example, the United Nations esti- clearly putting too much pressure on an already mates that a four-year drought in Syria has caused stretched environment. The result is a rapid 800,000 people to abandon their farming and herding degradation of the quality of local, regional, and livelihoods and has pushed many more people into global environmental services: clean air and water, poverty (De Schutter 2010). productive land, and biodiversity. Our patterns of growth are unsustainable and inefficient, but this Natural hazards continue to cause significant provides opportunities for greener—not necessarily loss of life and economic damage. Natural slower—growth. Policy makers have known for hazards—earthquakes, droughts, floods, and decades how to improve the efficiency of production storms—have on average resulted in 80,000 deaths and consumption, but they have failed to make per year since 1970 (World Bank and UN 2010). significant progress in adopting the needed Droughts have proved to be the deadliest of the measures and deploying the needed resources. The hazards and have affected poor countries dispropor- question then remains, Can we avoid the mistakes of tionately. Between 1970 and 2008, about 0.23 percent the past and move toward green and inclusive of cumulative world output was lost through growth fast enough to avoid the worst effects of property damage caused by these hazards. climate change, biodiversity loss, and water stress— Economic damage, however, disproportionately and do this while decreasing poverty? 2012–2022 | A World Bank Group Environment Strategy 19 Shutterstock 3 3 Coming Together to Transform Challenges into Opportunities As gloomy as the environmental picture seems, the forces behind these trends are not immutable. Recent history shows that the global community is moving in the right direction and that a concerted effort can bring ozone-depleting substances 4 (Velders et al. 2007). Since then, the use of stratospheric ozone-depleting substances has decreased significantly from over 1 million ozone-depleting-potential tons worldwide in 1990 to less than 44,000 tons by 2008 (UN 2010). success. The World Bank Group has been a part of This success can be attributed to national actions to this global effort. In some cases, such as the phasing meet international targets, technological innovation, out of ozone-depleting substances, global coordination and close monitoring (UNEP 1999). Another was the key to progress. In others, countries have example of progress executed by countries is the taken the lead to address threats like deforestation. global phaseout of leaded gasoline; by March 2011 all but six countries had phased out leaded gasoline. But given the reality of growing challenges, the WBG Finally, international carbon markets were and others must work together to provide strong developed and tested the complex technical mecha- leadership on the environment. Taking stock of the nisms necessary for monitoring emissions. global effort and the WBG’s contribution to it helps to answer the question of how the WBG and others can The scientific community has come together to amplify momentum around the progress to date. sound the alarm. Global action to protect the environment has demanded unprecedented international scientific collaboration. The Global Efforts and Country Intergovernmental Panel on Climate Change Efforts Catalyzing Action has contributed to a much greater depth of understanding of climate change and its potential Over the last 20 years there has been a tremendous impacts, as well as adaptation and mitigation global effort by countries acting locally and also options. The 2005 Millennium Ecosystem coming together as an international community to Assessment helped assess the consequences of act collectively. Both country-based and global ecosystem change for human well-being (MA 2005). efforts have yielded some key achievements, It provided the needed scientific basis for action on completing some of the difficult ground work to conservation and the sustainable use of ecosystems. build foundations for further progress. Similarly, the Foresight Report on the Future of Food highlighted the challenges of increasing production The global community has shown it can work by 70 percent to feed 9–10 billion people by 2050 together for change. In 1987, the Montreal Protocol while containing and reversing ecosystem damage paved the way for effective global action to save the (Foresight 2011). Earth’s protective ozone layer by establishing 4 Chlorofluorocarbons and halons phased out by 2010 had some of the highest targets to phase out the most damaging ozone-depleting potential. Current Montreal Protocol phase-out targets through 2030 focus on hydrochlorofluorocarbons, which have a lower ozone-depleting potential but are equally important due to their climate warming impacts. 2012–2022 | A World Bank Group Environment Strategy 21 Civil society groups have brought new levels of forests, set up protected areas, assess environmental scrutiny to the environmental behavior of govern- impacts of development projects, and manage ments, private companies, and international natural resources. The key issue clearly remains financial institutions. The demands of a globally whether adequate resources are devoted to imple- connected and environmentally aware marketplace mentation of these policies, and whether the have raised expectations of better environmental governance and political economy will enable behavior across the board—from governments to success. This remains a challenge in many coun- private companies to multilateral institutions like the tries. However, further progress is within reach. For WBG. Access to social media tools like Facebook, example, more than 170 countries (87 percent of Twitter, and Google Earth are further enabling partici- parties to the Convention on Biological Diversity) pation in the global dialogue and digital documentation have established national biodiversity strategies or of environmental issues. Local civil society action plans (CBD Secretariat 2010). And nearly involvement has become a critical part of development 133,000 protected areas—12 percent of the world’s project implementation and monitoring. All of this has land surface—have been designated for some added vital social capital that the world will need to protection. As a result of the collective effort of prove resilient in the face of challenges ahead. governments and international and national civil society, supported by financing from national and Many private sector firms have recognized that international organizations, numerous species have addressing environmental issues is good business. been moved to lower categories of threat, including Growth in programs addressing sustainability and 33 bird species since 1988, 25 mammals since 1996, development of standards has been a key devel- and five amphibians since 1980 (Butchart et al. 2010). opment in the past 20 years. Large corporations are increasingly concerned about their input supplies— Efforts to slow deforestation are showing water, land, and fish, in particular—and are finding results in some regions. Brazil and Indonesia, with ways to manage risks and turn scarcity into oppor- the highest net losses of forest in the 1990s, have tunity. Certification of the sustainable harvest of significantly reduced their deforestation rates (FAO timber and some other commodities is growing with 2010a). In Brazil, government measures, including the collaboration of the private sector. Voluntary better law enforcement, deforestation monitoring, standards provide a broader mechanism to effect and creation of protected areas, have led to a drastic change and improve environmental and social reduction in Amazon deforestation, from more than practices at the sector level by involving civil society 27,000 km2 in 2004 to about 6,200 km2 in 2011 (INPE and stakeholders with significant market power. 2011). While Asia experienced net forest loss of some 600 km2 per year during the 1990s, the region reported Both the public sector and the private sector are annual net forest gains exceeding 22,000 km2 from taking an active role in catalyzing actions to 2000 to 2010, primarily as a result of large-scale address environmental and social issues. The afforestation reported by China (FAO 2010a). public sector is creating an enabling environment to reorient public and private flows toward sustainable Law enforcement initiatives to combat illegal investments. Increasingly, public-private partnerships trafficking in flora and fauna are on the rise. A focus on agricultural and climate change, based 2010 study of timber-producing countries in Latin on a value-chain approach such as access to America, Africa, and East Asia, as well as of financial services, infrastructure, equipment for processing and consumer countries, found that production (such as irrigation), agro-processing, actions taken by governments, civil society, and the and access to markets (such as transport, storage, private sector since 2000 to combat illegal logging and communication). and trade have had a considerable impact (Lawson 2010). Illegal logging is estimated to have fallen by Without exception, all World Bank member between 50 and 75 percent since 2000 in Cameroon, countries now have some form of environmental the Brazilian Amazon, and Indonesia; imports of legislation in place. They have laws to protect illegally sourced wood to the seven consumer and 22 Toward a Green, Clean, and Resilient World for All processing countries studied were down 30 percent reflect an increasing trend toward “green” markets. from their peak in 2004. Through consumer country Annual global investments in renewable energy action, international trade in illegal timber has generation capacity and manufacturing plants become much more difficult. The European Union soared fivefold between 2004 and 2009, from $30 (EU) and the United States have banned the import billion to $150 billion (REN21 2010). This drove up of illegally harvested timber, and other countries are worldwide renewable energy capacity (with 10–60 developing similar legislation. percent average annual growth), in particular in grid-connected solar photovoltaic capacity (60 Countries are taking steps toward low-carbon percent) and wind (27 percent). During the same growth. Following commitments made under the period, global output of hydroelectricity, the most Kyoto Protocol, many countries that belong to the mature renewable, increased by more than 3 percent Organisation for Economic Co-operation and annually, with most of this growth occurring in Development (OECD), with the involvement of the non-OECD countries. Collectively, developing private sector, are moving toward lower-carbon countries have more than half of global renewable economies. This includes fuel switching (coal to power capacity, and this is affecting the business natural gas) and increased energy efficiency in strategies of the private sector. buildings, appliances, and transportation (OECD 2010). Many developing countries are also working There is now stronger recognition of the need for toward low-carbon development paths and articu- adaptation to climate change, and action is under lating these in their Nationally Appropriate way. The Bali Action Plan was adopted by the global Mitigation Actions (NAMAs).5 In many cases low- community at the 2007 UNFCCC COP. The plan carbon growth efforts are being led by cities, which calls for developed countries to allocate adequate account for more than 75 percent of the world’s energy resources to help developing countries adapt to use and greenhouse gas (GHG) emissions. Renewable climate change and to help build capacity to inte- energy use in these countries is increasing: production grate adaptation measures into sector-specific and of wind energy in non-OECD countries has increased national development plans. The December 2009 by 38 percent on average each year since 2000, with Copenhagen Accord pledged $100 billion per year recent yearly increases exceeding 55 percent. This by 2020 to meet these goals, with an expectation was almost matched by increases in solar electricity that the amounts for mitigation and adaptation of close to 50 percent (2008–09), with China accounting should be roughly equal. The accord presumed for a large portion of the increase, consistent with an leveraging of private funds. Developing countries overall record of raising its renewable energy have started to prepare adaptation strategies. production (IEA 2011b). Recent decisions in the Supported by the UNFCCC, most of the least seventeenth Conference of the Parties (COP) of the developed countries have prepared National United Nations Framework Convention on Climate Adaptation Programs of Action that identify urgent Change (UNFCCC) in Durban indicate a move and immediate needs to adapt to climate change. toward formalization of the NAMA process, which Countries are drawing on a number of instruments— could provide financial support to such strategies the Adaptation Fund and the Special Climate with the establishment of a registry where countries Change Fund—to initiate projects that help increase can place their NAMAs and with an emerging resilience to current and future climate variability. template of what is required for NAMAs. Access to sanitation has increased modestly from Markets for green technologies and products are 54 percent of the world’s population in 1990 to about expanding and growing fast in developing coun- 61 percent in 2008 (UN 2010). This has not kept pace tries. Global investments and production volumes with population growth, however, leaving 2.6 billion people without basic sanitation. Most of those 5 Nationally Appropriate Mitigation Actions were launched as part of Long-term Cooperative without access live in rural areas (Joint Monitoring Actions during the UNFCCC Conference of Parties in Bali in 2007. These mitigation actions are to be planned by developing countries, embedded in the context of sustainable Program 2010). A number of countries are development, and supported and enabled by technology, financing and capacity building addressing water quality and water resource through the convention (UN Framework Convention on Climate Change 2007). 2012–2022 | A World Bank Group Environment Strategy 23 management challenges. The EU Water Framework Work to help countries strengthen their institu- Directive provides for an integrated approach. For tional and policy frameworks for environmental many countries, including Brazil, China and India, management continues. Policy loans to governments improved water management is a strategic priority. have helped countries strengthen environmental policies and institutional frameworks. Policy lending for environmental issues accounted for $506 million, Assessing the World Bank or 8.3 percent of total policy lending, in fiscal year Group’s Current Contributions (FY) 03, increasing to $2.4 billion, or 14.4 percent, in FY10. Packages combining development policy Environment is now understood as a key devel- loans (DPLs) with analytical work and technical opment issue and is a core part of the World Bank assistance have helped broaden policy dialogue Group’s agenda. In considering a new strategy for across line ministries, including sectors where the environment at the WBG, it is necessary to under- WBG is not active (see Box 3.2). stand the scope of ongoing work on these issues. Responding to heightened global concerns, the WBG has integrated environmental considerations into its knowledge work, policy dialogues, country and sector strategies, and investments. The IFC has become a global standard-setter in environmental and social risk management along with new business models for sustainability for private companies and financial institutions. This evolution stemmed from client demand and from knowledge that progress in ending poverty is inextricably linked with better environmental management. Across infrastructure sectors, the WBG has helped countries to integrate environmental concerns into development. In Brazil, for example, transport operations such as the São Paulo Feeder Roads, BOX 3.1 Mato Grosso do Sul State Road Transport Project, Colombia CEA highlights need and Brazil Road Transport Project all couple invest- for revising air quality standards ments with technical assistance in strategic environmental management. A Country Environmental Analysis of Colombia highlighted the effect of indoor and outdoor air Policy analysis of environmental issues at the pollution, especially on the poor (Sánchez-Triana, country level has expanded. Country Ahmed, and Awe 2007), but the government was not Environmental Analysis (CEA), a tool the World inclined to immediately revise national air quality Bank developed, helps inform dialogue with coun- standards developed in the 1980s. Wide media tries, raises awareness of environmental problems coverage of the results of the Colombia CEA affecting poor people, and improves understanding resulted in a broad public debate, which was taken of the linkages between environment and growth up by politicians. Open public debate increased the sectors. CEAs have contributed to understanding number of champions for revising air quality how the burdens of environmental degradation are standards (Chavarro Vásquez 2007). In 2007, the distributed within societies (see Box 3.1). This work first air pollution control bill was discussed in the has highlighted that poor people carry a dispropor- national Congress. After 13 failed attempts over the tionate burden of illness, death, and loss of course of a decade, a more stringent Fuel Quality productivity and livelihoods as a result of environ- Law was finally passed, due in large part to public mental degradation. pressure in response to the CEA’s findings. 24 Toward a Green, Clean, and Resilient World for All The World Bank Group has become an environ- mental and social performance standard setter. The IFC’s Performance Standards are recognized as a leading benchmark for environmental and social risk management for private sector investors and are Shutterstock often considered prerequisites for companies to raise funds, particularly from international markets. The Equator Principles—a voluntary environmental and social risk management framework—are now the benchmark for 71 banks and financial institutions BOX 3.2 worldwide, 32 OECD export credit agencies, 15 Peru programmatic environmental European international financial institutions, and DPLs—Supporting environmental MIGA. In 2009, of the $75.5 billion total of project finance debt tracked (by Basel II), $40 billion was governance and mainstreaming subject to the Equator Principles, representing 53 in key economic sectors percent of the total project finance debt in emerging economies. Seventeen Equator Banks are now from In Peru, an Environmental DPL program consisting emerging markets, and this number is expected to of three operations supported the government’s grow quickly. Experience with the World Bank’s efforts to improve the effectiveness of environmental safeguards and accountability mechanisms are also governance and institutions. The program also now informing other multilateral development mainstreamed environmental sustainability into the banks (MDBs) and U.N. agencies. mining, urban transportation, and fisheries sectors. Moreover, the WBG has a dual role of enhancing the Environmental Governance: The DPL series positive impact of the financial system on devel- supported the creation of the Ministry of opment, including through financing for micro, Environment in 2008. It also supported reforms to small, and medium-size enterprises (MSMEs) and strengthen institutional capacity for biodiversity the allocation of capital for innovation and conservation through the creation of an agency for sustainable investments. Through their support to national parks and its sustainable financial strategy. financial institutions (FIs), the IFC and MIGA help The DPL program supported air quality monitoring, strengthen domestic capital and financial markets networks to improve air quality, and public and reach smaller clients (such as MSMEs, microfi- disclosure of information on air quality. nance, leasing, trade finance, guarantees, housing finance, consumer finance). Mainstreaming Principles of Sustainable Development in Key Sectors: In the mining sector, Through its engagement with FIs, the IFC supports the DPL series supported efforts to remediate the capacity development of the banking and legacy pollution in mining through participatory financial sector to manage environmental and social environmental monitoring. To improve environ- risks. This is achieved in part through the devel- mental health, the DPLs supported government opment and implementation of an Environmental reforms in urban transportation related to fuel and Social Management System and through quality and improved vehicle inspection and enhancing FIs’ in-house capacity for the day-to-day maintenance. Finally, the environmental DPL series management of portfolio risks, including environ- supported the government’s efforts to sustainably mental and social risk. Environmental and social manage the overcapacity and inefficiency problems risk management is part of the responsibilities that plaguing the anchoveta fishery, while also FIs assume. MIGA requires its guarantee holders to supporting social protection measures for fishers have Environmental and Social Management affected by fleet reduction. Systems in place to assess the impacts of individual projects that guarantee holders and its subsidiaries 2012–2022 | A World Bank Group Environment Strategy 25 support. In addition, the WBG has a number of Figure 3.1 financial products for businesses and continues to Environment and Natural expand its instruments to support investment Resources Management Lending programs that mitigate climate change and ensure environmental and social sustainability. Commitments (FY01–FY11) 7,000 Lending for the environment and natural 6,000 resources management (ENRM) has grown. World 5,000 Bank lending commitments addressing ENRM 4,000 themes have grown from $1.5 billion, or 8.4 percent 3,000 of World Bank lending, in FY01 to $6.3 billion, or 14.3 percent, in FY11 (see Figure 3.1), with the portfolio 2,000 covering biodiversity conservation and protection, 1,000 climate change, environmental policies and institu- 0 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 tions, land administration and management, pollution management and environmental health, IBRD/IDA Other (incl. Carbon Offset, water resources management, and other areas.6 GEF, Montreal Protocol, Other) Commitments addressing forestry development and management of timber production have grown from Other environ mgmt Biodiversity $136 million in FY01 to $313 million in FY11. 1,109 1,181 Similarly, World Bank lending commitments that 4% 3% address animal production, including fisheries and Water resource mgmt livestock, have grown from $8.7 million in FY01 to 6,679 $95.4 million in FY11. 20% Climate Change 8,287 25% The IFC invested $1.7 billion in climate-friendly projects in FY11, up 6 percent from $1.6 billion in FY10. IFC is within its goal to invest 20 percent of overall commitments in climate-change-related investments Pollution mgmt by FY13. In IFC Advisory Services, the portfolio related 7,721 Environ policy/insts to climate change totaled $113.3 million, an increase of 24% 5,172 8 percent over $103.9 million in FY10. 16% Land admin & mgmt 2,460 Figures in US$ million Non-environment sectors are actively integrating 8% the environment into programs and projects. As of end-FY11, 79 percent of new World Bank ENRM Source: World Bank. projects (or 95 percent of new ENRM lending commitment volume) were being managed by non-environment sectors.7 Figure 3.2 illustrates World Bank Group Support for the progress in the energy and mining and the water Green Agenda sectors. Much of this increase reflects stewardship in the extractive industries and energy. For example, The World Bank manages more funds for biodi- energy and mining programs have included versity conservation than any other organization capacity building in environmental assessment, and in the world, having built up a portfolio of biodi- infrastructure investments have financed environ- versity projects worth more than $6.3 billion in loans mental offsets and protected areas. and grants. Of this, the Global Environment Facility (GEF) contributed more than $1.4 billion in grants 6 Lending commitments include IBRD/IDA lending as well as grant and special financing. during the period 1991–2010. On average, the World Bank commits $309 million annually to biodiversity 7 Includes IBRD/IDA lending as well as grant and special financing. 26 Toward a Green, Clean, and Resilient World for All Figure 3.2 Environment and Natural Resources Management Lending Commitments in Non-Environment Sectors (FY01–FY11) 2500 2000 US$ million 1500 1000 500 0 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 Energy and Mining Water Source: World Bank. projects. Over the past 20 years, the World Bank has More than half of the World Bank’s conservation supported 624 biodiversity projects in more than 122 investments have been to protected areas. The countries, including 60 multicountry projects that World Bank has supported countries in establishing support biodiversity conservation and sustainable protected areas and building institutions to manage use in a range of ecosystems, such as coral reefs, them, investing about $275 million a year in coastal areas, mountains, forests, savannas, supporting parks. A number of the WBG’s infra- grassland, lakes, and rivers. structure investments have supported offset protected areas. Four of 11 national parks in Many countries have been developing laws to Cameroon stem from WBG-financed infrastructure support sustainable management of natural and tourism development. In Brazil, Peru, Colombia, resources with World Bank Group support. The Mexico, Bolivia, and countries of the Eastern West Africa Regional Fisheries Program is an Caribbean, the World Bank supports conservation example of WBG support, augmented by funding funds for the management of protected areas. Some from GEF and the New Partnership for Africa’s of this work incorporates biodiversity protection into Development, leading to improved fisheries productive landscapes, including forestry, coastal legislation in six countries in West Africa. In zones, and agriculture. Much of this work is in Madagascar, the Environment Program loans led to partnership with conservation nongovernmental better forest legislation, and in Lao PDR, the World organizations (NGOs), including WWF, Conservation Bank- and MIGA-supported Nam Theun II hydro- International, the Wildlife Conservation Society, the electric project has enhanced protected areas National Wildlife Federation, the International legislation. The WBG has also spearheaded the Union for Conservation of Nature, and The Nature negotiation of payments for environmental services Conservancy. Examples of partnerships include across a range of client countries, such as Costa work on endangered species and critical habitat Rica and Brazil. protection through the Critical Ecosystem 2012–2022 | A World Bank Group Environment Strategy 27 Partnership Fund, Save Our Species, and the Global the IFC and set the standard for what is considered to Tiger Initiative (see Box 3.3). be achievable in new facilities at reasonable costs by existing technology. The WBG has also been an World Bank Group Support for the active partner in the International Network for Clean Agenda Environmental Compliance and Enforcement, particularly in a training and curriculum devel- Pollution Management opment capacity through the World Bank Institute. Support to countries to reduce their pollution risks has grown. The WBG is helping clients to The World Bank Group is helping countries create regulatory, economic, and financial incentives address environment-related health issues to reduce pollution and increase clean production. For through rural water supply and sanitation, clean example, the World Bank helped strengthen institu- energy development, urban transportation, and tional capacity of state pollution control boards in natural resources management projects. The India, promoted industrial pollution control through strategy for health, nutrition, and population financial intermediaries in Egypt and Brazil, and recognizes that environmental improvements, such worked on environmental compliance in small and as clean water, sanitation, and reduced indoor air medium enterprises in Argentina. The Bulgaria pollution, improve health outcomes (World Bank Environmental Remediation Pilot project helped 2007b). Other WBG work focuses on how reducing reduce environmental hazards caused by past outdoor air pollution can substantively improve pollution and unsafe environmental management human health outcomes in urban areas (World Bank, practices of a copper smelter. 2007a, 2009c). Work with the private sector supports investments in water- and energy-efficient technol- Market-based approaches for pollution abatement ogies, wastewater treatment/reuse, and solid waste are under way. The Egypt Pollution Abatement management. In China, the World Bank’s work on air Project is demonstrating cost-effective solutions for pollution control and environmental health will industrial pollution abatement subprojects. It is contribute to improved air quality and health enhancing the government’s capacity in environ- outcomes throughout more than 600 cities, particu- mental management by supporting stronger larly in the 100 cities that do not comply with China’s regulation and by innovative market-based instru- own air pollution standards. ments. A key element is supporting Egypt’s access to the emerging carbon market and financing opportu- The World Bank Group is increasing collaboration nities. In South Asia, the WBG is spearheading a with the private sector to improve resource responsible sourcing initiative in the textile sector in efficiency. This includes the IFC’s Cleaner Bangladesh and piloting the use of market-based Production Lending Facility, a three-year, $125 instruments to address air pollution in India. million loan facility and advisory program that was approved in September 2009. It also includes the Cleaner water supplies and sanitation, better Cleantech investment program launched in FY10, urban and rural services, and cleaner transpor- investment and advisory services in energy effi- tation and energy and mining projects remain ciency and renewable energy, and direct support to priorities. In Bangladesh, the Clean Air and Safer financial institutions. Mobility project in Dhaka addresses air transpor- tation and stationary sources of air pollution. Climate Change Analytical work on environmental health valuation in The December 2011 Durban UNFCC COP 17 made a several countries is also bringing decision makers’ number of decisions that could place the world on a attention to these issues. A Pollution Prevention and more “climate-safe” trajectory in the long term while Abatement Handbook has become an internationally advancing a suite of important modalities for global accepted reference guide for good practice. The IFC’s climate action in the short to medium term. The Environmental, Health, and Safety Guidelines Durban Platform outlines a process toward reaching contain the performance levels that are acceptable to a global and legally binding agreement on emission 28 Toward a Green, Clean, and Resilient World for All Shutterstock BOX 3.3 Global Tiger Initiative (GTI)—Conservation through partnerships In 2008, the World Bank Group launched the GTI (with continue to mount. Under the current scenario, its partners, including among others WWF, the U.N. it is predicted that the tiger may become extinct within Office on Drugs and Crime, the Smithsonian the coming decade. This loss will have implications Institution, INTERPOL, Humane Society International, much larger than just the disappearance of a charis- and Conservation International), which has since matic species. Habitats where wild tigers live are received widespread support from the conservation high-value ecosystems that provide vital services like and scientific communities. In 2010, in St. Petersburg, carbon sequestration, recreational services, mainte- Russia, the Global Tiger Summit cemented political nance of hydrological balance, crop pollination, commitments to tiger conservation at the highest protection from natural disasters and soil erosion, levels and launched specific conservation programs in and preservation of genetic diversity of plants. The GTI tiger-range countries. supports capacity building for the public sector to respond effectively to the challenge of illegal trade in Poaching, habitat loss, and fragmentation have wildlife and for scientifically managing tiger land- reduced the global population of the tiger to less than scapes in the face of mounting and varied threats. 3,500 animals, and the pressures on these animals 2012–2022 | A World Bank Group Environment Strategy 29 reductions by 2015 that will include all countries in financing commitments to low-carbon energy accordance with their common but differentiated totaled $17 billion, consisting of renewable energy responsibilities and respective capabilities. This and energy efficiency investments and support to agreement would allow time for ratification and related policy reforms. Targeted mitigation support would take effect from 2020. is under way in more than 50 cities. The IFC committed $1.6 billion in FY10 to 84 private sector A second commitment period of the Kyoto Protocol projects to reduce greenhouse gas emissions, and it was also agreed, as was the design instrument for a plans to double climate-related business invest- Green Climate Fund. Further operationalization of ments by FY13. the institutional modalities for the Technology Mechanism, the Adaptation Committee, and the Climate change, both mitigation and adaptation, establishment of a registry of developing country was selected as a special theme within the over- mitigation actions were agreed on as well. Other arching theme “Delivering Development Results” important decisions related to the establishment of a for the IDA 16 replenishment. The World Bank forum and work program on unintended conse- committed to undertake several monitorable quences of climate change actions and policies, actions by the end of the IDA 16 replenishment procedures to allow carbon-capture and storage period (FY12–FY14): projects under the Kyoto Protocol’s Clean Development ■■ Discussing climate change vulnerabilities in 100 Mechanism, and development of a new market-based percent of IDA Country Assistance Strategies as mechanism to help developed countries meet part of part of the discussion of the country’s development their targets or commitments under the Convention. challenges and priorities and including activities in climate change mitigation and adaptation However, the Durban COP did not agree on any areas when requested by the recipient country numbers for long-term emission reduction goals and ■■ Scaling up IDA Analytic and Advisory Activities peaking years. Ambition on the mitigation front was on adaptation and mitigation not raised, and existing mitigation pledges were not ■■ Analyzing in all projects in climate-change- anchored in the Convention. Science tells us that we sensitive sectors the potential climate impact of are currently on a path towards an average global project activities to ensure that they are temperature rise of 3–4° C (in the best case scenario consistent with the climate change mitigation and with current pledges), which by far exceeds the 2° C adaptation strategies of the country goal of the UNFCCC framework. Avoiding a future ■■ Establishing a coding system to measure the with severe shortages of food, water, energy, and share of IDA investments that provide climate livelihoods for millions of people requires a signif- adaptation and mitigation co-benefits and icant and immediate increase in global climate reporting on the number of projects that aim at action to build resilience to projected climate change climate change co-benefits in their design (such and support efforts to reduce GHG emissions. as a percent of IDA investments that have climate change co-benefits) While the elements of a global agreement on ■■ Continuing dialogue with the OECD cutting carbon emissions are slowly coming Development Assistance Committee and on together, the WBG’s clients are already moving Rio-Markers with the objective of developing and rapidly toward lower-carbon development paths. In agreeing on quantitative measures of global response, the WBG has responded by piloting financing for climate adaptation and mitigation. innovation, exchanging knowledge, and scaling up action and finance for mitigation. At the end of 2006, the World Bank merged its Environmentally and Socially Sustainable Countries are seeking low-carbon development. Development practice with its Infrastructure Through work in 130 countries, the WBG is helping practice, creating the Sustainable Development nations move toward low-carbon development Network. This decision reflected that mainstreaming paths (see Box 3.4). Between FY03 and FY10, WBG environmental and social work in an integrated way 30 Toward a Green, Clean, and Resilient World for All in WBG infrastructure programs was a growing ■■ Green Bonds. In 2008, the World Bank’s Treasury priority. It also acknowledged the synergies inherent Department introduced Green Bonds specifically in sustainable development, whether it is among to finance climate mitigation and adaptation agriculture, water, and energy or mining, social work in developing countries by broadening the development, and forestry. investor group. Since then, over $2 billion has been raised via more than 35 Green Bonds The World Bank has played a critical role in issued in 15 currencies for eligible projects that establishing innovative global partnerships like reduce GHG emissions or help countries adapt the Climate Investment Funds, the secretariat for to climate change. which is hosted by the World Bank. Together with ■■ Sale of Certified Emission Reduction Certificates. recipients, donors, and the MDBs, the World Bank The World Bank’s Treasury Department sells helped raise $6.5 billion for the Clean Technology these certificates as a trustee of the U.N. Fund (CTF) and the Strategic Climate Fund. These Adaptation Fund, with over 7 million tons of funds support transformations in clean technology, emission reductions sold by 2011. This has raised sustainable management of forests, increased access nearly $120 million to finance adaptation projects to energy through renewable energy, and climate- in developing countries. resilient development in 45 countries. Developing ■■ Global Emerging Market Carbon Efficiency Index. countries are in the driver’s seat, with action plans The IFC worked with Standard & Poor’s to develop that are developed and presented by the recipient the world’s first carbon efficiency index for countries. Every dollar that the Clean Technology emerging markets. Launched in December 2009, Fund raises leverages $8.40 from other sources. it gives carbon-efficient companies access to long-term investors. The World Bank Group has developed a suite of ■■ Risk Guarantees and Insurance Funds. innovative financing options for low-carbon Over the past decade, partial risk guarantee development. Recognizing that current financing instruments have promoted renewable energy for climate change mitigation and adaptation in and energy efficiency investments, and risk developing countries falls far short of what is insurance products have been applied to needed, the WBG has developed innovative disaster response programs, including coverage financing tools to help developing countries pursue of climate impact risks. low-carbon economies and climate resilience. Beyond the CIFs, this includes: The World Bank Group is continuing to reduce its ■■ Carbon Finance. From the pioneer Prototype Carbon own impact through a string of internal sustain- Fund in 2000, initially capitalized at $180 million of ability initiatives. Formal programs have been set investible resources, WBG operations now include up within the World Bank and the IFC to manage 12 carbon funds and facilities with a total capital- environmental impacts from internal operations. ization of $2.74 billion and financial contributions Efforts to measure, report, and offset greenhouse from 24 governments and 63 private companies gas emissions from internal operations have been from various sectors (see Box 3.5). Every $1 in carbon strengthened. In 2006, the WBG became carbon- finance leverages on average $4 in climate-friendly neutral for its headquarters-based internal business investment. Carbon finance has been innovative not operations, including all facilities operations, staff just as part of the Kyoto mechanism but also as a air travel, and owned vehicle use. WBG facilities are “pilot” for voluntary carbon markets. now more efficient in water use, waste management, ■■ Private Sector. In the private sector, the WBG has and procurement, and the results of these efforts are focused on providing services and financial published annually on the website. In 2010, the IFC’s products that increase projects’ carbon revenues, headquarters building was awarded the Leadership including the Carbon Delivery Guarantee, which in Energy and Environmental Design Platinum helps developing country projects maximize the Certification for Existing Buildings by the U.S. value of their future carbon credits, and guarantee Green Building Council. Two other WBG buildings products offered by MIGA. have received a gold standard, and the new “C” 2012–2022 | A World Bank Group Environment Strategy 31 Shutterstock BOX 3.4 Forming a link between development and climate change Though the World Bank Group joined early in the of it. The Cancun Agreements (2010) and the Bali development of carbon finance, its overall efforts to Action Plan provide a platform for an eventual global meet the challenge of climate change lagged behind agreement on reducing greenhouse gas emissions until 2007. With the launch of the WBG’s Strategic and helping developing countries to address climate Framework for Development and Climate Change in change challenges. 2009, the scale and scope of the institution’s support to countries have rapidly expanded, as has Momentum for global climate action is emerging, as engagement with the international climate dialogue. more and more countries realize the urgency. Yet In 2010, President Robert B. Zoellick directed that a emission reduction targets and pledges in the context Special Envoy for Climate Change be appointed to of the Cancun Agreements account for only 60 percent represent the Bank in international climate discus- of what is required to hold the increase in global sions and to strengthen the WBG’s capabilities to temperatures below 2°C. Though global efforts are deliver on a stepped-up role. IFC also formed a not yet at a sufficient level, many of the Bank’s client Climate Business Group. countries are demonstrating leadership on low emission development, and in the future the Bank will Concerned that a lack of progress on climate change assist their efforts as much as possible. Already, the could undermine global poverty reduction efforts, the World Bank Group is responding to client demand in World Bank Group developed a set of “building this area by supporting mitigation and adaptation blocks” around key themes—mitigation, adaptation, activities in 130 countries. From 2009 to 2011, over 90 REDD+, finance, carbon markets, agriculture, percent of World Bank Country Assistance Strategies technology, and water. These building blocks support focused on climate action, while $7.7 billion in engagement with developing countries on comple- development policy lending supported climate change mentary actions by the WBG and others that may help actions in 17 countries. The most recent replenishment advance the UNFCCC process or find progress outside of IDA—the WBG’s fund for the poorest 32 Toward a Green, Clean, and Resilient World for All countries—included a special theme on “achieving building also earned platinum for its core and shell. climate-resilient development.” The World Bank Group In recent years, there has been greater disclosure of is also providing upstream support to integrate climate WBG corporate environmental impacts through considerations into long-term planning processes. leading industry reporting venues. In 2009, the Between 2008 and 2011, the Energy Sector Management World Bank became the first multilateral devel- Assistance Program and the World Bank Group opment bank to report its greenhouse gas emissions supported in-depth low-carbon development studies in to the Carbon Disclosure Project, starting with its seven emerging economies. Washington, DC, operations. The Climate Change Knowledge Platform supports World Bank Group Support for the screening of country-level climate risk and vulnerability, Resilience Agenda—Adaptation including tailored information for policy makers in key areas such as disaster risk management and adaptation. The World Bank Group is the world’s largest financier of disaster risk reduction and recon- Since the 2001 Environment Strategy, the World Bank struction. Since 2007, lending for post-disaster Group’s Carbon Finance Unit has grown to include 11 recovery projects alone has reached $9.2 billion for carbon funds and $2.4 billion under management. By 215 projects. The Global Facility for Disaster 2010, the unit had signed 128 Emissions Reductions Reduction and Recovery, of which the WBG is a Purchase Agreements. This flow of funds is helping to partner, has 75 projects under way worth $33 million, promote investment in more-efficient infrastructure and focusing specifically on climate change adaptation. in carbon sequestration. Most important, the Bank’s carbon work focuses on two key objectives: innovation The World Bank Group has contributed to building that pushes the frontiers of carbon finance, providing the knowledge base about adaptation to climate depth and diversity to the market, and efforts to put least change. The Economics of Adaptation to Climate developed countries first. The two objectives are often Change study was initiated in the spring of 2008 as linked, as the World Bank Group helps to develop deals a result of discussions at the UNFCCC’s thirteenth on soil carbon, forestry, and community development. COP. In partnership with the governments of Bangladesh, Bolivia, Ethiopia, Ghana, Mozambique, In 2006, the World Bank and IFC teamed with Samoa, and Vietnam, the study helped to develop a the other MDBs to launch the $6.5 billion Climate global estimate of what it will cost developing Investment Funds. This is a unique set of instruments countries to adapt and to better understand the risks giving developing countries a boost in achieving posed by climate change and design strategies for climate-smart development. The Clean Technology Fund, adaptation. The study estimated that it would cost the Pilot Program for Climate Resilience (PPCR), the $70–100 billion per year between 2010 and 2050 for Forest Investment Program, and the Scaling Up developing countries to adapt to a 2oC warmer world, Renewable Energy Program are now working in 45 and it provided empirical support for the view that countries, with Africa receiving the most investment. The adaptation is a cost-effective strategy. CIFs are unique for a governance structure: 50 percent representation from developing countries, strong A focus area has been support to countries for leadership and ownership by client countries, and strong climate-resilient agriculture. This includes collaboration among MDBs. Under the PPCR, countries improved watershed management and storage have addressed adaptation by investing in urban drainage, augmentation, agricultural water management, and coastal zone management, more-resilient roads, improved access to weather and climate services. more-efficient agriculture and water use, and risk In Morocco, which faces increasing water stress, a management. It has quickly demonstrated the links dual approach is supporting diversification in between climate change and development and the irrigated agriculture and sustainable natural usefulness of a focus on solutions. resource management in the rain-fed sector. In Mexico, the Agricultural Sector and Water Program 2012–2022 | A World Bank Group Environment Strategy 33 Shutterstock BOX 3.5 A global Forest Carbon Partnership Facility contributing to the REDD+ agenda The Forest Carbon Partnership Facility (FCPF), estab- countries, donors, carbon fund participants, and lished in 2008, focused on reducing emissions from observers from indigenous peoples’ groups, civil deforestation and forest degradation (REDD+). It is an society, international organizations, the private sector, example of World Bank Group innovation and leadership UN-REDD+, and the UNFCCC. in tackling challenging environmental issues. Current pledged funding to the Facility is $393 To be effective, REDD+ has to address the multiple million, including approximately $218 million for drivers of deforestation and forest degradation—often the Readiness Fund and $175 million for the Carbon the agriculture, energy, mining, industry, transpor- Fund. The Readiness Fund provides readiness tation, urban, and tourism sectors—and to get the preparation grants to REDD+ countries. Thirty-seven support and full engagement of government, private REDD+ countries have been selected into the part- sector, indigenous peoples, local communities, and nership (14 in Africa, 15 in Latin America and the civil society. It also means setting the right incentives, Caribbean, and 8 in Asia and the Pacific) to meet the including financial ones. Recognizing this, the World high level of demand. Bank led the way to set up this partnership facility with an innovative and participatory governance The FCPF has made considerable contributions to the structure where, as with the CIFs, developing coun- REDD+ agenda. It helped to move REDD+ from tries have the same voice as donors and other concept to reality and to establish processes, proce- financial contributors. The partners include REDD+ dures, and standards for REDD+ readiness. 34 Toward a Green, Clean, and Resilient World for All supports enhanced agricultural water management, The World Bank Group is helping at least 90 integrated soil fertility management and conser- countries adapt to climate change. Through the vation tillage, targeted research, and seed reserves Pilot Program for Climate Resilience (PPCR), under and wildland conservation, together with programs the Climate Investment Funds, the World Bank to enhance agribusiness and increase social works to pilot and demonstrate ways that countries protection for the vulnerable. can build climate resilience into development planning and implementation in 18 countries, The World Bank Group has a growing body of work including two subregions (the Caribbean and the on increasing resilience in cities. Through its work Pacific Islands) (see Box 3.6). Financing for climate- program on cities and climate change, the World affected sectors—agriculture, flood protection, water Bank has developed the Urban Risk Assessment supply, and health—in the poorest countries reached framework, which will be piloted in selected cities in $3.3 billion in FY09, a 17 percent increase over the Africa and South Asia. The Mayors’ Task Force on previous IDA funding cycle. The WBG is working Climate Change, Disaster Risk and the Urban Poor with GEF, the CIFs, and other partners to help is supported with a global study and case studies in countries in sub-Saharan Africa become climate- Dar es Salaam, Jakarta, Mexico City, and São Paulo. resilient. It is also carrying out analytical work to The recently completed Guide to Climate Change improve the design of WBG interventions and Adaptation in Cities is being used in dialogue with supporting clients to get access to adaptation grants cities in the Middle East and North Africa and in from the Least Developed Countries Fund and the project preparation in Belize and Senegal. Tools Special Climate Change Fund and improve their being developed for cities in East Asia and the preparedness to tap the Adaptation Fund. Pacific include the Multi-hazard City Risk Index, the Workbook on Planning for Resilience in Cities, and The World Bank Group is pioneering financial the Urban Flood Management Handbook. innovations to deal with climate risks. The IFC is 2012–2022 | A World Bank Group Environment Strategy 35 BOX 3.6 Pilot Program for Climate Resilience The Pilot Program for Climate Resilience is one of the implementation of the priority investments. Since four programs funded through the Climate Investment the approval of the PPCR in 2009, some 11 Strategic Funds. The PPCR aims to facilitate scaled-up trans- Programs have been endorsed by the PPCR formational change to increase the resilience of Sub-Committee for a total of up to $767 million of selected developing countries most vulnerable to PPCR resources. climate change. Building on national strategies and programs, the PPCR pursues innovative ways to Under the PPCR, Bangladesh is targeting appropriate integrate climate risk and resilience into core investments in all vulnerable coastal districts, Niger development activities of the participating countries. aims to reduce food insecurity exacerbated by climate Nine countries (Bangladesh, Bolivia, Cambodia, change, and Samoa plans to reinforce aging infra- Mozambique, Nepal, Niger, Tajikistan, Yemen, and structure in densely populated coastal zones. A total of Zambia) and two regions (Caribbean and Pacific) were 44 projects are identified in the endorsed Strategic selected to participate in the PPCR. Programs for Climate Resilience and are currently under preparation or have started implementation. The PPCR consists of two phases: the first phase Bangladesh’s $110 million PPCR resources will leverage focuses on the preparation of a Strategic Program for almost $500 million, and Tajikistan’s $50 million PPCR Climate Resilience and the second phase focuses on resources will leverage more than $120 million. 36 Toward a Green, Clean, and Resilient World for All playing a leading role with index-based weather Protection strategy place high priority on building insurance in Africa. The Global Index Insurance resilience, given its importance in the livelihoods of Facility is an innovative program that is expanding poor and vulnerable groups. Through green growth access to insurance against weather risks and other strategies, public works programs that create natural disasters in developing countries, particu- short-run employment, for example, can be made larly to farmers. The Index is currently working in more inclusive while also helping restore landscapes Burkina Faso, Kenya, Mali, Mozambique, and through watershed management, terracing, affores- Rwanda and has recently been approached to tation and reforestation, and other forms of soil support projects in the Caribbean. An erosion control. Learning from earlier experience on IDA-supported index-based livestock insurance China’s Loess Plateau, these approaches are being project in Mongolia—the first of its kind anywhere in replicated through operations like Ethiopia’s the world—has been active for five years and is being Productive Safety Nets Program and Rwanda’s scaled up nationwide. Important lessons have been Vision 2020 Umurenge Program. In India, rural learned on the value of risk layering and getting the livelihood-support projects in states such as Andhra policy divide right between commercial insurance Pradesh, Maharashtra, and Rajasthan are being products and the wider social insurance framework. scaled up to the national level through the National Rural Livelihoods Mission. Among other things, this The role of social protection systems in promoting program addresses climate resilience through resilience is key. Both the World Bank’s updated convergence with the National Rural Employment Social Development strategy and the new Social Guarantee schemes. 2012–2022 | A World Bank Group Environment Strategy 37 Shutterstock 4 4 Lessons Learned and Voices Heard The evidence is clear that the WBG and its partners have stepped up environ- mental efforts dramatically in the past 10 years, but the evidence is also clear that the state of the world’s environment continues to private sector undertakings to improve the environ- mental and social sustainability of their investments. Good governance and political will are needed for strong institutions to emerge. To help coun- deteriorate. How can the WBG use its position to tries improve enforcement, the WBG needs to focus have greater impact, and do it faster and better, in more on sustained capacity building. It takes time to order to help change this? In order to answer this build institutions, and the WBG has repeatedly question, the WBG reflected on the lessons of the underestimated the time and persistence required. effort of the last 10 years and listened to the Experience also shows a need to better understand concerns of stakeholders. the role of nonformal institutions, the political economy dimensions, and windows of opportunity for governance and institutional reform. Where What Have We Learned? efforts to improve the governance of forests or fisheries have failed, for example, there is often a Ten years of rich experience scaling up the WBG’s link with vested interests in government or with environmental work have crystallized key lessons. weak political will to confront corruption. Understanding the political landscape and then Strong institutions, legislation, regulation, and identifying local champions for reform is essential. enforcement are critical. The WBG’s experience Informing the public, the media, legislative bodies, with supporting clients to build their policy and and civil society about key issues can also help build institutional frameworks has reinforced the impor- momentum for reform. tance of strong environmental and regulatory institutions. Over the past 20 years, developing Policy failures leading to perverse incentives countries have made significant strides in setting up account for several failures in environmental environment and regulatory agencies, while putting management. From distorting subsidies to poorly in place environmental legislation and imple- defined property rights, policy failures account for menting regulations. However, the WBG portfolio many environmental problems. Sometimes these highlights the need for greater country ownership failures are due to a lack of information or analysis, and involvement of a wider range of stakeholder but more often they are linked to a lack of political groups, including women. Legislation and regula- space to pursue reform. Fossil fuel subsidies on tions are only as good as their enforcement, which production and consumption create incentives to has been extremely weak in many countries. The continue using oil over other sources of energy. Bank’s experience shows that strong institutional Agricultural subsidies on soy and corn also lead to and policy frameworks with clear targets and distorted consumption patterns. Poor land titling guidance help create an enabling environment for and tenure make it very difficult to manage the rural 2012–2022 | A World Bank Group Environment Strategy 39 landscape efficiently, leading to distorted decisions small enterprises with reliable, clean lighting at the interface between land and forests, for (Alstone et al. 2011). example. Offshore property rights can also be poorly defined, leading to an underinvestment in Women and children are also among the most enforcement of laws governing fisheries and marine vulnerable to climate risk. Women and girls, due to areas. A suite of other subsidies has led to the cultural norms, may be less mobile than men and may serious overcapacity of fishing fleets. lack vital survival skills to weather storm events. Consequently, women are likely to suffer greater Environmental risks impede poverty reduction. damages from climate risks and have a lower capacity Typically, it is poor people who live in precarious to adapt. At the same time, empowered women have a and unsafe conditions in areas where basic services proven track record of improving adaptation and like a clean water supply and sanitation are inad- mitigation outcomes (Ahmad et al. 2010). equate. They live close to waste dumps and contaminated lands and in vulnerable coastal areas. Partnerships are essential to success in Studies on the cost of environmental degradation addressing environmental issues. The agenda is show that direct health impacts associated with huge, and one institution alone cannot have enough environmental risk factors cost countries the impact on all the environmental challenges facing equivalent of 1.2 percent to over 4 percent of GDP the developing world. Partnerships help leverage (World Bank 2008a). The costs can be as high as 9 support to address clients’ needs by mobilizing and percent of GDP in countries like Ghana and leveraging finance, by strengthening awareness, Pakistan, taking long-term effects of malnutrition analytical, and scientific work, and by strengthening into account (World Bank 2008a). In some countries, environmental governance. Partnerships with health impacts of environmental degradation are multilateral funds such as the GEF and the almost five times higher on the poor than on others Multilateral Fund for the Montreal Protocol have per unit of income (Sánchez-Triana and Awe 2007). focused on global and trans-boundary environ- mental issues. Close partnerships with civil society Women and children are bearing the brunt of organizations have allowed a greater focus on environmental decline in developing countries. biodiversity in particular. The partnerships with the Poverty often means dependence on natural Trust Fund for Environmentally and Socially resources for survival. Many rural women and their Sustainable Development and the Bank-Netherlands families depend on nontimber forest products for Partnership Program have supported key analytical income, traditional medicines, and nutrition, but work. The Environmental and Social Fund for Africa these oft-marginalized communities are increasingly launched by MIGA, with support from the losing access to even these resources. In many government of Japan, provides technical advice on developing countries, women spend between several environmental and social matters to foreign hours per day on firewood collection. In Asian and investors in Africa. Other trust funds have focused African countries, women often walk six kilometers on key subsectors, such as ProFOR or ProFISH. a day to collect water, carrying 20 kilogram loads on Partnerships with the United Nations Environment their heads. With water scarcity in many parts of the Programme allow the WBG to broaden its analytical world, water availability for hygiene is limited, base. Increasingly, Bank clients are demanding adding to the risk of maternal mortality during South-South learning, acknowledging that middle- childbirth and to infant mortality from diarrheal income countries are the source of much innovation. diseases. Access to safe, clean, and affordable water Perhaps most important, through the Climate or fuel can provide significant socioeconomic and Investment Funds the MDBs are working in collabo- health benefits to women, in addition to environ- ration and demonstrating scaled-up climate action. mental benefits. For example, modern, off-grid lighting solutions such as micro-solar power and Partnering with the private sector is essential to light-emitting diodes can enable women to save sustainable growth and the development of money, reduce indoor air pollution, and operate their technological solutions. The private sector plays a 40 Toward a Green, Clean, and Resilient World for All key role in creating jobs, and jobs provide a pathway out of poverty. It can contribute in ways that complement the public sector, such as through public-private partnerships, supply chain devel- opment, and adoption of environmental sustainability principles that are good for business and for improving environmental outcomes (see Box 4.1). Whether they consume water, paper, tree crops, or fish, corporations are increasingly concerned about the sustainability of their supplies. The private sector is also part of the solution for financing better environmental management as it invests in inno- vation, technology, and communications in key sectors. The sector is also essential for its invest- ments in technologies that are solving clean energy challenges, improving monitoring through satellites, BOX 4.1 and improving the efficient use of natural resources. Clean energy—Engaging the telecom private sector in climate Similarly, sustainable and inclusive growth is change mitigation dependent on sound financial markets, strong governance structures, and sustainable financial institutions. It is also important in funding innovation Implemented in partnership with the GSM in areas vital for green and inclusive growth and in Association of mobile phone operators, this project mobilizing much of the required investments. The promotes the adoption of renewable energy for financial sector creates access to investments that cut powering telecommunication towers. An estimated across the entire value chain of financial services— 118,000 of the 300,000 towers that will be built in from pension funds to retail banking—and innovative off-grid locations by 2012 could be powered by financial instruments. For example, in the context of renewable energy sources on a commercial basis. climate change the insurance industry plays an This would represent a reduction of about 2.4 billion important role in enabling green and inclusive liters of diesel per year, the equivalent of 6.3 million growth through specialized niche products to address tons of CO2 emissions. To address the lack of barriers to green development and climate resilience. familiarity and the perception of high risks by mobile phone operators, IFC’s Advisory Services World Bank Safeguards and IFC’s/MIGA’s developed an online database covering more than Sustainability Framework are important tools for 9,000 renewable energy tower deployments. The ensuring that environmental and social concerns transition toward renewable telecommunications are integrated into all aspects of WBG-financed towers was supported through workshops, projects. The application of safeguard policies analytical tools, and training materials, including has been essential in ensuring assessment of techniques to select suitable sites for renewable alternatives and avoidance or mitigation of energy. To date, 250 sites have been identified potential adverse environmental and social impacts. where renewable energy deployment has a payback The policies have also provided a platform for period of less than three years. stakeholder participation in project design and implementation. The successful application of the safeguard policies has led many borrower countries to work with the World Bank in developing systems that incorporate safeguards, particularly with respect to environmental impact assessments and resettlement plans. 2012–2022 | A World Bank Group Environment Strategy 41 A 2010 Independent Evaluation Group (IEG) sustainable development in the private sector. The assessment (IEG 2010) found that World Bank 2010 IEG assessment has shown success in identifying safeguard policies were effective in avoiding or and mitigating environmental and social risks. mitigating potential environmental and social Furthermore, compliance on MIGA-supported projects impacts and risks in large-scale projects. For has improved since the introduction of the example, in the Nam Theun 2 hydropower project in Sustainability Framework and Performance Standards. Lao PDR, World Bank safeguard policies ensured The updated Sustainability Framework approved by attention to watershed management, biodiversity the Board of Executive Directors in May 2011 reflects conservation, and the need for comprehensive the evolving nature of the social and environmental resettlement and livelihood restoration programs. sustainability agenda as well as developments in IFC’s Safeguard policies can go beyond the mitigation of business model and in the markets where the IFC harm and be an important entry point for increasing operates. The IFC’s commitments in the areas of the environmental and social sustainability of climate change, human rights, gender, and corporate operations. The IEG noted the need to strengthen governance, as well as capacity building, are clarified environmental and social supervision and improve and strengthened in their performance standards. design and implementation of Environmental and While stressing the mitigation of negative impacts, the Social Management Frameworks. The IEG report IFC will increase its focus on positive impacts and also recommended that the World Bank strengthen developing client capacity. monitoring of outcomes, enhance client capacity, ensure client ownership, and improve the Packaging different instruments is important in management of project-level grievances. sustaining longer-term investments and contrib- uting to sustainability. This includes packaging of The IFC and MIGA Sustainability Framework reflects knowledge products, policy dialogue, and lending. both organizations’ strategic commitment to The sequencing of instruments is also important. 42 Toward a Green, Clean, and Resilient World for All For example, Country Environmental Analyses have into its own monitoring as quickly as possible. In been useful inputs to the design of development addition, while lending for environment and natural policy operations, allowing choice of the right policy resources management has grown, the World Bank and institutional reforms needed to enhance envi- needs better systems to show this progress. This ronmental sustainability in the country. Packaging means appropriate coding and indicators to show investment or technical assistance with policy loans how different sectors—agriculture, energy, transpor- enhances the sustainability of environmental tation, water, and urban development—are factoring outcomes. Private sector advisory services should be the environment into their operations. Effective closely aligned with investment priorities, as this is measurement is key for progress, whether it is in critical to marketplace credibility and for identifying reducing emissions, forestalling biodiversity loss, or partners for piloting innovative approaches in managing urban pollution. Data and access to data environmental and social value creation. must be improved. The IFC has established a monitoring and reporting framework to track Programmatic approaches help with long-term Environmental and Social Performance against 25 engagement. Programmatic approaches provide related performance indicators. opportunities for longer-term client engagement, especially on issues of environmental governance Infrastructure is an important vehicle for green and sector reforms that build sequentially from and inclusive growth, and the WBG needs to previous operations. For example, in Ghana forestry continue its involvement in the infrastructure reforms across three DPLs built on each previous business, promoting environmental sustainability. operation, strengthening ownership and support for Infrastructure development is critical to delivering enforcement in the government’s forestry program. growth, reducing poverty, and addressing broader In Vietnam, the Poverty Reduction Strategy Paper development goals. Infrastructure investments also series deepened climate change mainstreaming are an important tool for green development as through sequential policy reforms. investments help to avoid locking into unsus- tainable growth paths. Knowledge generation is good; sharing it and demonstrating change through its use is priceless. WBG analytical work can provide clients Voices of Our Stakeholders with the knowledge they need to inform their decision making. Applying that knowledge in This Strategy draws on extensive consultations with practice and ensuring its dissemination in easily governments, the private sector, academia, civil understandable language to a broad group of society, and development partners around the world. stakeholders can help advance countries’ green A series of 66 consultations were organized from development goals. The study financed by the Trust October 2009 through June 2010, with the support Fund for Environmentally and Socially Sustainable of key partners in a number of venues. These Development on developing new policies for consultations allowed us to engage with more than reducing air pollution and improving health condi- 2,300 stakeholders from 126 countries, covering tions based on pilot projects in selected cities (for Africa, East Asia and the Pacific, Eastern Europe and example, in Shanxi province) will be replicated in Central Asia, Latin America and the Caribbean, and more than 600 cities by the Chinese government Middle East and North Africa Regions, as well as through their promulgation of new national donor countries. Consultations engaged stake- measures and technical guidelines holders, including government officials and representatives of the private sector, academia, civil Baselines, monitoring, and measuring need to society, NGOs, media, and other development improve. Through the work in carbon markets and partners. In addition to the face-to-face consulta- other market-based instruments, the ability to tions, stakeholders provided comments through the measure environmental changes is improving. The Environment Strategy website (www.worldbank.org/ World Bank needs to integrate these improvements environmentstrategy), translated to all official World 2012–2022 | A World Bank Group Environment Strategy 43 Bank languages. More than 73,000 visits to the website were recorded. Stakeholders called on the WBG to play a leadership role in the following areas: ■■ Promoting a new development paradigm . Stakeholders want the new Strategy to promote an ambitious vision for sustainable development, rooted in valuation and accounting for natural resources and externalities, including emissions, health impacts, biodiversity loss, marine systems, and climate change. Developing country represen- tatives argued for help in acquiring technologies and know-how to pursue clean development priorities and in accelerating the move to green, clean, and resilient development outcomes. ■■ Raising awareness and communicating about the environment and its links to development. The Strategy should convey the urgency and need to succeed in achieving environmental sustain- ability and the consequences of failure. Civil society in developing countries called on the WBG to communicate more, and in accessible language, about environmental issues and how they are linked to development outcomes, to help improve demand for better governance and environmental sustainability across sectors. ■■ Knowledge development and sharing for sustainable development. The WBG’s global presence, strong research and analytical work, and project implementation experience across various sectors were raised as important factors in trans- ferring knowledge and good practices between developing countries and also between developed and developing countries. Donor countries and NGOs want the World Bank to increase research and make data more accessible to strengthen environment and development decision making. ■■ Governance and competent public and private institutions. Capable institutions that enable countries to “green” their development paths were seen as essential to progress. There were strong calls for WBG support in building capacity at national and subnational levels and across line ministries. Support for improving regulatory frameworks that facilitate private sector partici- pation in sustainable development was also raised. Stakeholders called on the WBG to seize opportu- Shutterstock nities to complement capacity-building efforts in industries in developing countries, for example on pollutants, chemicals, and waste management. 44 Toward a Green, Clean, and Resilient World for All ■■ Safeguards. Recognizing the role of World Bank ■■ Balancing attention to global public goods. safeguard policies in reinforcing their own national There was broad agreement that the WBG plays systems and in building local capacity, stakeholders an important role in addressing global environ- urged the World Bank to embrace a bottom-up and mental issues but that this should shift from country-owned approach to safeguards. focusing on “trade-offs” to promoting opportu- ■■ Better measurement of results to improve environ- nities for co-benefits and win-win approaches. mental sustainability of the World Bank Group Governments and development organizations portfolio. Many participants in the consultations urged that climate change should not “crowd out” called for a results measurement framework that other environmental issues. recognizes the roles and strategies of environ- ■■ Partnerships, coordination, and harmonization . mental and nonenvironmental sectors. A related Developing country governments called for suggestion was to ramp up internal incentives for greater reliance on partnerships involving WBG staff to improve environmental sustain- development partners, regional development ability of the portfolio. banks, U.N. agencies, bilateral agencies, EU ■■ Provide customized solutions to environmental institutions, the OECD, and others to maximize challenges. There is no one-size-fits-all approach—a efficiency. Civil society called for more work with message that came through clearly, especially from communities and NGOs in developing countries. consultations with small island state representa- Closer collaboration between the World Bank, the tives who said they want customized solutions to IFC, and MIGA was viewed as important for their unique environmental challenges. enhancing private sector partnerships. 2012–2022 | A World Bank Group Environment Strategy 45 5 46 Toward a Green, Clean, and Resilient World for All 5 From Vision to Action Having considered the opportunities and challenges presented by the state of the environment, examined ongoing efforts of partners, considered the lessons of the WBG’s experience, and listened to stakeholders, it is Over the next 10 years, the Strategy will give priority to scaled-up action in seven key areas: (i) Wealth Accounting and Valuation of Ecosystem Services (WAVES), (ii) a new World Bank-led Global Partnership for Oceans, (iii) pollution management, clear that this Strategy must bring all of the convening (iv) low-emission development, (v) adaptation, power, knowledge, finance, and partnership of the (vi) disaster risk management, and (vii) improving WBG to bear for game changing success for a green, the resilience of small island states. These priority clean, and resilient world. The vision laid out in this areas cut across the green, clean, and resilient Strategy is ambitious, reflecting the scale of the agendas of the Strategy. challenges facing countries and the continuing barriers to action on global environmental issues. But the vision Implementing this Strategy will require that the focuses on scaling up in areas where the WBG can fill WBG ensures adequate resources, both human and a gap or add value to a global effort, recognizing that budgetary, to deliver on the ambitious vision proposed. scarce budgetary resources must be used efficiently Helping clients to move toward green, clean, and and selectively. The Strategy strives to answer the resilient development will mean that the WBG will question, If transformation is needed in the next 10 itself be working more actively to ensure that its years, how can the WBG’s capabilities best contribute portfolio of projects and activities become greener, to what our clients and partners need for success? cleaner and more resilient. WBG staff will need to possess adequate skill sets and capacity, which can A first aspect of the Strategy will be ensuring that be deployed for maximum impact. To this end, the sectors across the WBG keep to their environmental WBG is presently conducting a talent review process commitments (as laid out in Annex 1). Building that will help identify skill gaps and ensure adequate support for country and region-level investment in staffing to deliver on regional commitments. improving the environment will continue. Many of the actions in this Strategy cut across the green, clean, and resilient thematic areas. Environmental Supporting the Environmental safeguards, for example, apply across the board, as Pillar of Sustainable Development do commitments to incorporating gender dimensions and the Green Agenda into WBG operations addressing the environment. Across all three agendas, the goal is to mobilize The WBG’s “green” agenda places a priority on additional sources of financing while developing continued economic growth as a requirement for and spreading knowledge on innovation and best poverty reduction, but it calls for greener growth practice, providing support for policy reforms, and options to ensure sustainability. While waiting for helping to strengthen institutions and capacity for the global dialogue on climate to move forward, the environmental management. WBG’s role is to listen to its shareholders’ priorities 2012–2022 | A World Bank Group Environment Strategy 47 and to respond with leadership, advocacy, part- policy and investment decisions. 8 Through the nership, analysis, knowledge-sharing, and financing. Global Partnership for Wealth Accounting and the Valuation of Ecosystem Services, the World Bank A large part of the WBG‘s green agenda will focus and its partners will promote sustainable devel- on how to nurture sustainable growth and poverty opment worldwide through the implementation of reduction while protecting biodiversity and comprehensive wealth accounting that focuses on ecosystems. In that regard, the Strategy considers the value of natural capital and integration of “green both how growth can become more sustainable and accounting” in more conventional development how investing in the environment can stimulate planning analysis. In its first year, WAVES is growth. The WBG’s green agenda will focus on supporting five developing countries (Botswana, activities that can leverage change , including Colombia, Costa Rica, Madagascar, and the analytical and knowledge-sharing work: on natural Philippines) to “green” their national accounts, in capital accounting and valuing ecosystems; on the partnership with developed countries that are health of the world’s oceans; with the private sector leading the way in this area with expertise or on the development of key markets and initiatives; financial support (Australia, Canada, Norway, and and on the expansion of support for biodiversity the United Kingdom). As WAVES builds its conservation. knowledge and experience base, and given growing demand arising from awareness of the importance of Valuing Ecosystems, Emphasizing green and inclusive growth for sustainable devel- Oceans, Protecting Biodiversity opment, the number of countries participating will significantly increase. A key goal of the World The World Bank will promote bringing natural Bank’s work in this area is therefore to demonstrate capital into systems of national accounts to better how countries can use environmental accounts to assess the sustainability of growth. Why are we improve decisions about managing natural capital overexploiting natural resources to the point of system and thereby support their sustainable development collapse? One reason is poor accounting and worse with genuine green and inclusive growth trajec- pricing. Historically, countries have not depreciated tories. For example, a country rich in forests could nonrenewable commodities in their national accounts decide how to optimize these assets for a mix of as they are exploited. This understates the importance ecosystem services such as water services, carbon of transforming revenues from oil, minerals, and storage, timber and nontimber forest products, forests into productive and human capital. In a subsistence livelihoods, coastal protection, tourism, market-based world, as natural resources become and biodiversity (see Box 5.1). scarce, their value should rise. And this is indeed evident in price trends for many single commodities. The Blue Agenda But when natural resources are more complex The World Bank Group will leverage existing than a single commodity—such as an ecosystem that financing for fisheries, coastal and marine prevents erosion, acts as a storm barrier, filters water, protected areas, and integrated coastal and or harbors fish—then they are seldom valued correctly marine ecosystem management to facilitate the in local markets or in national accounts. Although the creation of a new Global Partnership for Oceans. concept of environmental or “green accounting” The goal of this partnership is to sustainably has been recognized and discussed for over 20 years, enhance the economic, social, and ecological few, if any, countries actively include their natural performance of the ocean’s ecosystems and living assets in their systems of accounts. This systemic resources, with improved benefits captured by undervaluation of ecosystems and their services has coastal and island developing countries and with been a key factor in poor policy formulation and global benefits accruing to the planet as a whole. global environmental decline. Investing in healthier ocean ecosystems represents 8 Note that valuation is a critical step to permit governments to monitor the overall With green growth for all as an objective, accurately sustainability of growth as well as to understand the value of the services provided by valuing ecosystem services is vital for making better assets such as forests. But it does not affect individual behavior toward these assets, which is determined by price signals (or rules and regulations or even traditions). 48 Toward a Green, Clean, and Resilient World for All Shutterstock BOX 5.1 Investing in mangroves Accounting for natural capital can help people make engineered alternatives (Ramsar Convention on better decisions about land use. The conversion of Wetlands 2005). mangroves has a strong economic impact on local l Since 1994, communities have been planting and fishing communities and food production in several protecting mangrove forests in Vietnam as a way of regions, as mangroves often serve as a nursery for buffering against storms. An initial investment of fish and crustaceans. Moreover, maintenance or $1.1 million saved an estimated $7.3 million a year restoration of mangroves can reduce vulnerability of in sea dike maintenance and appeared to signifi- coastal areas to sea-level rise and extreme weather cantly reduce losses of life and property from events while also contributing to food security. Often, typhoon Wukong in 2000 in comparison with other cost-effective ecosystem‐based approaches are areas (IFRC 2002; World Bank 2010b). implemented when correctly valued and incorpo- l Loss of mangrove area has been estimated to rated into policy decisions. For example, when increase in expected storm damages on the coast accounting for only marketed goods (timber and of Thailand by $585,000 or $187,898 per square nontimber), mangroves have an estimated value of kilometer (in 1996 dollars), based on damage data $864 per ha. Accounting also for coastal protection, from 1979–96 and 1996–2004 respectively (Stolton, the value per hectare is $16,861. This knowledge Dudley, and Randall 2008). would better inform policy makers about the l Recent studies in the Gulf of Mexico suggest that trade-off between preservation and conversion to mangrove‐related fish and crab species account for shrimp farming, which has an estimated per hectare 32 percent of the small-scale fisheries landings in value of $9,632 (Barbier 2012). the region and that mangrove zones can be valued at $37,500 per hectare annually (Aburto‐Oropeza et Examples of how restoring and protecting mangroves al. 2008). can reduce vulnerability include: l In Surat Thani, Thailand, the sum of all measured l Mangrove forests have been estimated to have an goods and services of intact mangroves exceeded economic value of $300,000 per km as coastal that of shrimp farming from aquaculture by around defenses in Malaysia, when compared with 70 percent ($60,400) (Balmford et al. 2002). 2012–2022 | A World Bank Group Environment Strategy 49 a tremendous opportunity for the global economy— and most notably for coastal and island developing countries, where so much of the ocean’s wealth can be found. As the world prepares to feed more than 9 billion people, more and more experts worry about the overexploitation of fish stocks, given that fish provide 16 percent of the world’s animal protein intake. As pollution from industry, agriculture, and human waste mounts, as coastal zone ecosystems falter, and as biodiversity loss accelerates, better management of the two-thirds of the planet covered by oceans has become critical. Although $1.5 billion of WBG investments (including $100 million financed by GEF) already target “the blue economy,” an intensified effort is needed to register a global impact on the future of marine and coastal resources. To accomplish this, the WBG will build partnerships and seek consensus, increase analytical work and BOX 5.2 knowledge sharing, reach out to the private sector, Assisting Africa to rebuild work across sectors, build capacity and institutions, overexploited marine fish stocks and leverage innovative financing (see Box 5.2). The Global Partnership for Oceans will work to Some of the world’s most fertile fishing grounds scale up sustainable use. At the 2011 Annual can be found off the coasts of Africa, with fisheries Meetings, the World Bank invited a wide range of providing livelihoods for 10 million people as well as partners to discuss the potential need and scope for 20 percent of the animal protein intake in the a global partnership to support more sustainable use region. But these fisheries and the habitats that of the oceans and whether the Bank should play a support them are increasingly threatened due to role. The meeting sent a clear signal that the chal- weak governance that fails to control access to the lenges and opportunities facing the oceans were fish resources. For this reason, the World Bank and beyond the scope of any one group or organization partners are supporting investments to sustainably to address, and the Bank had a clear role to play increase the net economic benefits generated by based on its convening power around global public Africa’s marine fish resources and to keep more of goods and its ability to leverage public investment the output within the region. This fisheries program across its portfolio. As a result, a WBG-wide Blue includes direct support for a regional fisheries Team consisting of staff from Regions and anchor partnership mechanism to promote fisheries units as well as the IFC has been formed. After the governance and policy reforms in Africa, together Annual Meetings the Bank continued this dialogue with the African Union, the New Partnership for with a number of groups and potential partners, and Africa’s Development, the GEF, the FAO, and WWF. in February 2012 it announced the development of The program also includes regional fisheries the Global Partnership for Oceans and invite investments in participating countries, starting with interested partners to join. This partnership recog- the West Africa Regional Fisheries Program in the nizes the vast array of actors working on oceans coastal countries from Mauritania to Ghana. These issues—foundations, NGOs, U.N. agencies, and investments ($128 million in six countries to date) MDBs. The partnership also includes the private aim to support the governance of marine fisheries, sector—investors, fishing associations, aquaculture reduce illegal fishing, increase the local value producers, seafood processors, and importers— added to fish products, and protect critical natural which plays a critical role in ocean resource habitats and ecosystem processes that underpin the management, with many commercial actors health of the fish stocks. 50 Toward a Green, Clean, and Resilient World for All increasingly concerned about the sustainable supply alignment of the public and private sectors. A new of seafood. This reflects a broad consensus in many Oceans Financing Facility will be established as part respects between conservation groups and the of the Partnership to catalyze greater external and private sector on key priorities for healthier oceans. IBRD/IDA financing of effective oceans governance in In our consultation, we heard clearly that the WBG countries and regions, in order to help meet the triple can add value in supporting sustainable certification bottom line of improving economic (rent capturing), of seafood; strengthening the capacity of institutions social (poverty reduction through economic growth), governing fishing activities, with an emphasis on and environmental protection outcomes. more secure and transparent rights; and using the WBG’s knowledge generation and convening power Biodiversity and Conservation to advocate for effective policy in reducing the risk In the past, World Bank clients have not always of negative externalities on the ocean environment. chosen to borrow for work on biodiversity and The WBG’s efforts will also build on existing conservation. However, the World Bank has used its partnerships that already address issues of concern role as an implementing agency for the GEF to to the oceans, such as PROFISH and WAVES, and effectively leverage IDA and IBRD financing. It is strive to design a more comprehensive approach to now clear that biodiversity is one of the planetary supporting the blue economy. systems most threatened by environmental degra- dation and climate change, and clients keen to stem As part of the Partnership, a new knowledge the tide of extinction and loss of biological diversity platform on oceans will be explored. The abun- are asking to work more with the World Bank on these dance of scientific and economic information on the efforts. The work on WAVES will help to establish the oceans is critical for crafting solutions. With partners, true value of biodiversity and the Global Partnership particularly the FAO, the WBG will explore how data for Oceans will help the World Bank to scale up its and knowledge platforms can be enhanced to serve conservation of marine protected areas. But the World real-time information needs and foster greater Bank will also strive to do more on biodiversity linked exchange of knowledge and South-South collaboration. to forests and agriculture as clients look more at As part of the Global Partnership for Oceans, an landscape approaches. oceans knowledge platform will initially focus on sharing information on valuing improvements in the The lending program for biodiversity and conser- health of marine ecosystems and more broadly on vation will be expanded. Clients are asking for more analytical work assessing the health of oceans, support on protected areas management, including modeling global fish supply and demand ecotourism, biosafety, wildlife protection, and through 2030. As with the World Bank’s work on conservation. The World Bank is learning to further climate knowledge, this platform will take advantage of leverage GEF financing on landscape management growing initiatives on open data to provide for an and make better use of GEF resources to develop exchange of data, models, and analysis. Knowledge programs for biodiversity protection. In addition, the will also be shared in various forums, including World Bank will seek to build partnerships with a conventions under U.N. agreements, regional fisheries large array of organizations to scale up our work on management organizations, and social media. biodiversity and conservation. Client countries are Communications efforts would focus on the need for setting aside more areas for conservation and good governance of local resources and effective seeking sustainable financing for parks and park action on the global commons. As a precursor to these systems. Ecotourism, which has become the fastest- efforts, a short film on the oceans has been developed growing and most profitable segment of the tourism for the Partnership by the National Geographic industry in the area, is providing alternative incomes. Society, and an independent website has been estab- lished (see www.globalpartnershipforoceans.org). Funding partnerships, learning, improved data, and innovative finance for biodiversity will With respect to increasing funding for oceans work, receive even more attention. Programs such as the the Bank will focus on leveraging the evident Critical Ecosystem Partnership Fund, Save Our 2012–2022 | A World Bank Group Environment Strategy 51 Species, and the Global Tiger Initiative have prepare for other REDD+ programs. Truly provided interesting experience on different sustainable capture of carbon, just like sustainable approaches to conservation. They have allowed the forest management, will require addressing the World Bank to gain knowledge on wildlife corridors, challenging governance, land management, and payment for ecosystem services, and wildlife benefit-sharing mechanisms. The World Bank will monitoring. The WBG will try to find more inno- continue to work with its partners to develop forestry vative approaches to conservation finance, in the carbon markets and ensure that it is a rigorous leveraging our work on forests, land, oceans, and capture of carbon and also of co-benefits. The World private sector development. Bank will also contribute through policy dialogue, DPLs, and sector investment loans. In the private Resourcing forest countries to protect their sector, support will be aimed at reducing forest natural assets remains a priority. Client demand conversion and improving access to certification, for assistance in managing forests is strong, and the global standards, and carbon markets. Efforts to WBG will continue to address this demand through accelerate payment for environmental services lending and knowledge generation for sustainable programs will be expanded. Similarly, the WBG will forest management. The World Bank has gained look at the potential for trust funds, bonds, infra- valuable experience on concession management, structure offsets, carbon premiums, private-public community forestry, value-added wood industries, log partnerships, and other tools that can scale up tracking, and other approaches to sustainably financing for conservation. managing productive forests. Various climate financing instruments, including the Forest The World Bank will further develop the Investment Program under the CIFs and the Forest “wildlife premium” as part of its climate finance Carbon Partnership Facility (FCPF) are aiding the work. Building on the concept that World Bank financing of afforestation and avoided deforestation. Group President Robert Zoellick launched at the Of the 48 countries under the Forest Investment Convention on Biodiversity COP in Nagoya in 2010, Program that expressed strong interest in becoming the wildlife premium idea recognizes that lowering pilot countries, only eight were selected, due to carbon emissions is only one part of measuring the limited resources. The WBG will strive to help all benefits of sequestering carbon by protecting forests countries seeking assistance in managing forests. and other natural habitats. “Co-benefits” linked to Last year, six countries—Burkina Faso, Democratic simultaneously protecting wildlife and biodiversity Republic of Congo, Ghana, Indonesia, Lao PDR, and are more difficult to value and are not yet traded on Peru—received grants of around $250,000 through an international market. The “wildlife premium” on CIFs for investment programs in sustainable forestry. carbon trades that protect habitats will test the market’s willingness to pay for these co-benefits. Technical and financial assistance to countries to become “ready for reducing emissions from Support to governance and institutional reforms deforestation and forest degradation (REDD+)” for improved natural resource management and will continue. Responding to a mandate from the biodiversity protection will continue. 2007 Group of Eight Summit, the World Bank Recognizing the importance of natural resources for established the FCPF to help countries address livelihoods and for fiscal revenues (from oil, gas, challenging issues of deforestation and forest minerals, timber, fisheries, freshwater, and coastal degradation. Depending on their institutional resources), the WBG will continue to work with capacity and financial resources, tropical and clients to explore better ways to manage this wealth subtropical forest countries—or REDD+ countries— to sustain growth. This includes improving account- will vary in how long they will take to be “ready for ability and transparency in revenue management REDD.” Through the FCPF Readiness Fund, selected through the Extractive Industries Transparency countries are developing the necessary systems, Initiative (EITI). Tools like Strategic Environmental such as for monitoring, and putting in place policies and Social Assessments and Country Environmental that help them get access to the Carbon Fund and Analyses will help inform client decision making by 52 Toward a Green, Clean, and Resilient World for All identifying environmental priorities and the institu- biodiversity through support for the collection of tional and governance gaps that need to be closed so better data, open access to the data, and the that enforcement of policies linked to conservation construction of a knowledge platform that allows or the sustainable management of natural resources clients and stakeholders to compare approaches and can be more rigorous. results. Embedding these tools into World Bank environment programs and strengthening their Wildlife crime has become better organized and adoption will be an important focus. more violent, but protection measures are also advancing. Further work is needed on law Policies to Remove Barriers to enforcement for forests, wildlife and fisheries Green, Clean, and Resilient Growth management, and revenue or benefit sharing at the local level in sectors such as forestry, hydropower, Market and policy distortions that lead to biases and mining. In South Asia and in the Mekong Basin, against greening development need reform. The the World Bank is supporting regional cooperation WBG will explore opportunities for policy reform that for protection of wildlife in Bangladesh and Nepal by would improve the efficiency and cost-effectiveness of helping governments to strengthen joint capacity, environmental management, including reduction of institutions, knowledge, and incentives to collab- subsidies and trade barriers to environmental goods orate in tackling illegal wildlife trade and other and services. Through the Green Growth Knowledge threats to habitats in border areas. Platform, research will focus on how to build greater support across national constituencies (for example, The World Bank is joining forces with other how to mitigate the effects of energy price increases partners to fight environmental crime. Under the on the poor and options to channel efficiency gains International Consortium on Combating Wildlife from reforms into broader opportunities). The Crime, the World Bank will work with INTERPOL, trade-offs in making greener investment choices at the U.N. Office of Drugs and Crime, the World the sector level will also be analyzed. Analytical work Customs Organization, and CITES to reduce wildlife will assess how environmental co-benefits of actions crime. Within the World Bank, a Community of to mitigate or adapt to climate change can be iden- Practice on Environmental Crimes has been estab- tified and maximized in projects. Understanding lished and is implementing an action plan that will barriers to the transfer and use of win-win technol- diagnose environmental crime and provide a ogies and practices (such as environment and health; business case for addressing it as a critical devel- energy efficiency, energy cost, and GHG emissions; opment issue; give priority to select operational ecosystem protection and improved livelihoods for activities, such as in the areas of customs reform and the rural poor) will be key to this effort. forest governance; and identify discrete opportu- nities for advancing the agenda through specific Market-based Mechanisms and environmental law enforcement initiatives, for Sustainable Supply example through cross-border interdictions. The work will build on the World Bank’s operational core The creation of inclusive, environmentally competences and focus on countries and issues sustainable, and efficient markets will be a key where the development impacts are the greatest. focus. The WBG will work with private sector firms to address market barriers to business practices and Planning, monitoring, and evaluating environ- decisions that lead to profitable commercial outcomes mental progress in client countries will be while creating environmental or social value. IFC’s strengthened. Through its work in carbon finance, Advisory programs will focus on climate-related the World Bank will also continue to improve investments and sustainable supply chains and look monitoring of carbon emissions, soil degradation, toward environmental and social value creation. forest density, and water resources. As we propose to Conservation NGOs are increasingly realizing that do with climate, wealth accounting, and oceans, the they cannot succeed in protecting species without a World Bank will also leverage knowledge on focus on the drivers of deforestation, landscape 2012–2022 | A World Bank Group Environment Strategy 53 degradation, and overfishing. They are reaching out and Central Asia Region, for example, effective to form partnerships with the private sector on approaches to cleaner production programs are greening supply chains, and the WBG will partner aligned with EU environmental policies, making a with them in these efforts. critical contribution to sustainability. Cleaner production and sustainable supply chain Private sector clients will be asked to develop efforts will be extended. The WBG plans to extend steps to screen and monitor for supply chain risks. its work on sustainable supply chains to new indus- For example, IFC’s Performance Standard 6— tries. As an example, work is progressing on the Biodiversity Management and Sustainable development of new standards for forest harvesting Management of Living Natural Resources—has been and marketing activities, including tracking wood expanded to include requirements for clients to assess products from the standing tree to the timber product whether their primary suppliers are contributing to at the point of export. Monitoring the origin and degradation or conversion of natural and critical destination of legally harvested wood products serves habitats. If so, clients would either shift their to promote better forest management. Similarly, the purchasing to suppliers who are not doing this or IFC seeks to green supply chains in various indus- would work with their suppliers to stop conversion of tries through investment and advisory work at project sensitive habitats. Where this is not possible, the IFC and sector levels. The WBG will also promote will expect the client to shift suppliers over time. sustainable land use and alternative livelihoods in the rain forest through dissemination of soy and beef Updating and Consolidating the standards, reforestation of degraded lands, forestry Safeguards licenses and concessions, and inclusive supply chains for small cash crops. Through its safeguards update and consolidation process, the World Bank will continue to move Many countries lack alignment between environ- beyond a “do no harm” approach. A process is under mental management and industrial competitiveness way to update the World Bank’s safeguard policies policies. Linking development goals (like maximizing to address emerging issues, incorporate lessons public welfare and enhancing competitiveness) learned, and meet the changing needs of clients. means linking pollution management approaches to This will allow World Bank policies to better support management of environmental risks. In the Europe environmentally and socially sustainable 54 Toward a Green, Clean, and Resilient World for All development and provide for their more effective, accelerating and expanding such positive develop- efficient, and timely application. The goal is to make ments and will share constructive results and the policies more performance-oriented and imple- experiences across developing countries, for mentable by clients at the national and subnational example through South-South collaboration and level. The updating and consolidation process will environmental awareness events. seek opportunities for use of a greater range of instruments to assess potential environmental and Significant lessons have been gathered from specific social impacts and risks. As the process moves pollution abatement projects in all Regions, such as forward, it will involve a program of stakeholder from the $1.5 billion project to clean up India’s vast consultations on a global level that will include a Ganges River. Similarly, the Gulf Environmental diversity of parties. Partnership and Action Program in the Middle East and North Africa Region builds on lessons from The World Bank is also applying its safeguards to earlier regional programs, such as the Mediterranean new climate finance instruments like the FCPF, Environmental Technical Assistance Program, which which builds on REDD+ readiness programs in strengthened the environmental management selected countries. REDD+ activities will be subject capacity and policies of riparian countries of the to Strategic Environmental and Social Assessments. Region. New operations will build on these types of The World Bank will work with the other MDBs and lessons, with an eye to innovation and leveraging. In relevant U.N. agencies in REDD+ activities to ensure the Philippines, a large programmatic approach a coherent approach to applying safeguards to these consisting of a cluster of advisory services and activities. The World Bank will also continue lending operations is being undertaken to address working with clients to strengthen their own pollution management in the Manila Bay area. systems of environmental safeguards. Through Green Growth, Firm Competitiveness and Pollution Management: A Sourcebook of Policy Tools Supporting the Clean Agenda for Governments, Private Sector, Financial Institutions, Civil Society and the Judiciary, the WBG will dissem- As the world strives to green growth, a central part inate lessons learned from more than 10 years of of the challenges and the solution will be cleaning experience. Analytical work to support countries’ up the impact on air, land, and water of earlier decision-making processes in integrating environ- growth patterns. The WBG will focus its clean mental management, social inclusion, and growth agenda on pollution management, carbon mitigation objectives will continue (see Box 5.3). and low-emission development, and carbon and climate knowledge and finance. Priority efforts will focus on air pollution. With many fast-growing economies now facing increased Finding Answers, Providing environmental health costs associated with air Resources in the Fight against pollution, demand for cleaner production and Pollution improved air quality is growing. The World Bank will focus on helping clients manage air pollution by The World Bank Group will build on lessons from strengthening environmental health valuation successful pollution management policies and analysis to help identify priority actions for reducing projects to provide innovative solutions. pollution through a better understanding of where Particularly during the last decade, many devel- pollution comes from and how to cost-effectively oping countries have established environmental reduce the most critical sources. Also, it will provide institutions, developed environmental policies and analytical and advisory support to enhance the regulations, and increased their general awareness environmental governance frameworks and policy about environmental issues. Through such efforts, tools for improved air quality in client countries, pollution levels in some of those countries have particularly in Asia and the Middle East and North begun to level off. The WBG will assist in further Africa. Air pollution is usually generated from a 2012–2022 | A World Bank Group Environment Strategy 55 their efforts to address pollution legacies. It will also support countries in East Asia and the Pacific, BOX 5.3 Africa, and Latin America. These regions are Strengthening the knowledge base expanding industrial development and need to on structural change and green manage the resulting pollutants. Work will focus on inclusive growth in Pakistan mitigating public health risks from legacy pollution and past industrial activities and on river cleanup The government of Pakistan recognizes that trans- projects in Europe and Central Asia, Latin America, portation and trade logistics efficiencies are and South Asia (see Box 5.4). In Africa, the World prerequisites for economic stabilization, sustained Bank will support new analytical work on hazardous growth, and competitiveness. The transportation waste, pesticides, and persistent organic pollutants. sector plays an important role in linking other sectors in the economy, contributes to both domestic Agriculture is a major source of river pollution in and international trade, and helps facilitate the many countries, including those with smallholder- spatial transformation occurring in Pakistan. intensive agriculture. The World Bank is assisting However, reforms and investments in the trade and countries with improved nutrient management and transportation sectors could stymie poverty control of agricultural runoff. In China, where reduction efforts in some regions, aggravate promotion of environmentally sustainable agri- environmental problems like urban air pollution and culture is a strategic priority, operations are under greenhouse gas emissions, and affect women or way to address these issues. These include the Jilin contribute to social conflict. The Bank’s Strategic Food Safety and Agricultural Technology Project Environmental, Poverty, and Social Assessment and the Eco-farming and Henan Yellow River identifies cost-effective ways to improve the effi- Ecological projects. ciency of the freight transport system to meet goals of enhancing export competitiveness, decreasing The World Bank will also focus on the increased spatial inequality, reducing environmental degra- challenge of marine pollution by working on ways to dation, and developing interventions to support those address critical pollution sources, such as land- who might be affected by reforms, particularly the based discharges, atmospheric inputs, marine poor, women, and other vulnerable groups. transportation, dumping, and oil spills. In particular, this work will focus on controlling the main sources of nutrient, petroleum, and solid waste pollution. Expansion of the use of clean cookstoves will be variety of sources, including energy, transportation, supported. The World Bank will work with its various industries, natural dust, and so on, which partners and carbon finance funds to scale up use implies that often a multisectoral approach has to be of a new generation of stoves to help reduce indoor developed in order to substantively reduce overall pollution, benefit women and girls, and reduce pollution levels. The World Bank, through its trans- pressure on the environment. The WBG’s draft portation sector, will address fuel quality and the energy strategy also highlights the role of sustainable phasing out of highly polluting vehicles. Through its biomass energy in meeting cooking and heating energy sector, the WBG will address cleaner energy needs, especially in Africa and South Asia. It empha- options, and through the application of the new sizes the importance of sustainable wood-fuel sourcebook on pollution management, it will address production and processing along the value chain. pollution from a number of industrial sectors. Global transboundary impacts of hazardous The World Bank will focus on legacy pollution chemicals will continue to be a priority. With and water basin cleanup. Building on lessons from Multilateral Fund, GEF, and other support, the WBG the last 10 years, the World Bank will continue to will continue to help countries fulfill their obliga- support countries in Europe and Central Asia in tions to address global pollution risks. With the 56 Toward a Green, Clean, and Resilient World for All BOX 5.4 Cleaning up rivers, improving health and livelihoods ARGENTINA—Matanza-Riachuelo Basin Sustainable the environment sector. It will help build the capacity Development Project. The Matanza-Riachuelo, a of the recently formed National Ganga River Basin tributary of the Rio de la Plata, is the most contami- Authority, with the medium-term goal that no nated river basin in Argentina and the country’s most untreated municipal or industrial wastewater will be visible environmental issue. Over the past 100 years, allowed to flow into the main stem of the river after the river basin—home to 3.5 million people, including 2020. The project will help fund priority investments in Argentina’s largest concentration of urban poor—has four key sectors critical for reducing pollution in the been used as a sewage sink for Buenos Aires. More river: wastewater collection and treatment, industrial than 4,000 industrial facilities are located within the pollution control, solid waste management, and basin, and many of these discharge untreated riverfront management. It promotes clean devel- effluents directly or indirectly into the river. The opment and drives innovation by piloting the use of poorest populations living alongside the river are in new wastewater treatment plant technologies, constant contact with contaminants, including establishing the Ganga Knowledge Center, and untreated organic waste and toxic industrial chem- building the capacity of central- and state-level icals. This comprehensive $840-million Bank-financed institutions. cleanup project supports the government’s Integrated Basin Cleanup while improving sanitary conditions KAZAKHSTAN—Nura River Cleanup. From the 1950s along the banks of the La Plata River and providing a until 1997, a former Karbide factory used mercury in long-term and cost-effective solution for safe disposal the production of synthetic rubber. The factory’s of wastewater from the Buenos Aires Metropolitan original wastewater treatment plant was not designed Area. The project includes investments in modern to remove mercury from process water, so mercury sanitation infrastructure to reduce flows of sewage flowed to the factory’s discharge channel and then to effluent, improved environmental monitoring and the Nura River. The $91.6-million Bank-financed Nura enforcement of environmental targets for industry, River Cleanup Project supports the government to and financing of cleaner production investments so provide access to safe and reliable water by cleaning that small and medium-size enterprises comply with up the mercury pollution at the former factory site environmental standards. and in the Nura River basin and by rehabilitating a nearby dam. Cleanup measures that bring river water INDIA—The National Ganga River Basin. This quality into line with international standards for transformative project is helping the government of mercury concentration are essential for improving India clean up its iconic Ganga River. At $1.5 billion, it water quality and safety. is the largest investment made by the World Bank in 2012–2022 | A World Bank Group Environment Strategy 57 Montreal Protocol engaged in the phaseout of indicators (in line with those of the United Nations hydrochlorofluorocarbons through 2030, it is viewed Environmental Management Group and interna- as a key partner in addressing climate change. The tional standards such as ISO 14001), increasing WBG will promote alternatives to the use of ozone- efforts to promote staff engagement, and expanding depleting substances that also maximize climate communications to external audiences on WBG benefits through adoption of climate-benign efforts to reduce its corporate environmental impact. substances where feasible and improvement of The WBG is also actively working with country energy efficiency in related equipment. The World offices and clients to demonstrate corporate sustain- Bank will help developing country partners ability initiatives globally. worldwide reduce and phase out both the production and use of ozone-depleting substances. Legacy Ramping Up Support for issues associated with persistent organic pollutants, Low-Emission Development including in relation to brownfield redevelopment, will be addressed, and the reduction of future Work on climate mitigation will be expanded. releases will be given priority through interventions Given the prospect of continuing rapid urbanization across sectors. Recognizing the environmental and in developing countries, and the resulting growth in human health impacts of global mercury contami- energy and transport services, the WBG will nation, and the worldwide consensus to phase out its continue to support planning efforts and policy and use and reduce its environmental releases, the WBG institutional reforms that promote low-carbon will seek to integrate mercury reduction into its growth and improved pollution management. More investment programs. than 90 countries have registered their 2020 plans to address GHG emissions with the UNFCCC, Work will continue to help developing countries including 51 developing countries. address their environmental health challenges. Through the last decade, it has become clear that Support and capacity are needed to design, plan, and analysis of the physical and economic costs of implement low-emissions policies, to enhance pollution, particularly health costs, has become a coordination across ministries and engage on very important tool for raising awareness and Nationally Appropriate Mitigation Actions at convincing governments and the public of the need national and subnational levels, to improve data for effective pollution management. The World Bank streams and access to information, to develop the will continue to develop understanding of the health monitoring, reporting, and verification (MRV) effects of pollution and help countries to identify frameworks necessary to secure international and implement the most cost-effective interventions support, and to obtain finance for implementation of for improving environmental health outcomes, by low-emission plans. The WBG is well placed to taking a cross-sectoral approach and focusing on the support this process. Low-carbon growth studies most polluting sources. have been completed for Brazil, China, India, Mexico, South Africa, Indonesia, and Poland; Work will continue to reduce the World Bank additional studies are under way in Nigeria, Group’s internal environmental footprint. The Morocco, Tunisia, Macedonia, Colombia, Uruguay, WBG has committed to reducing the environmental Vietnam, and Costa Rica. In Mexico, for example, the impacts of its day-to-day operations through the WB study contributed to obtaining $500 million from the Corporate Responsibility Program and the IFC Clean Technology Fund and $401 million for a World Footprint Program. The WBG continues to Bank financed DPL on low-carbon development. strengthen its corporate GHG management program Knowledge and lessons learned are being by ensuring alignment with international standards exchanged across these activities. and best practice. The WBG will also support its sustainability efforts by formalizing a corporate Support to low-emission development investment sustainability vision statement, establishing a programs will increase. Clean energy development management framework with specific performance and access to electricity services are key strategic 58 Toward a Green, Clean, and Resilient World for All directions for the WBG energy program. The renewable energy portfolio more than doubled from $2.9 billion over FY06–08 (18 percent of total WBG BOX 5.5 energy financing in the period) to $6.6 billion in The strategic value of hydropower FY09–11 (22 percent), and it is projected to rise to 30 percent of total energy investments in FY12. Situated at the nexus of water and energy, hydro- Investments in hydropower are targeted to be at power currently supplies 84 percent of the world’s least $1 billion annually (see Box 5.5). In addition to electricity derived from renewable sources and is funding this through IDA and IBRD, the WBG will increasingly important to a low-carbon energy use the Energy Sector Management Assistance future. It is also vulnerable to projected climate Program, CTF, and the Scaling Up Renewable change. As a climate change mitigation measure, Energy Program (SREP). Currently, the CIFs have hydropower strengthens a region’s ability to $4.5 billion committed under the CTF that can regulate and store water, thereby increasing leverage another eight times that amount from resilience to flood and drought shocks. The WBG public and private sources. With SREP, the CIFs will can help maximize the strategic value of hydro- improve focus on low-income countries and bring power in four key ways: together energy access with clean and resilient l Scale up financing: This would include measures development. Although the MDBs have taken the to improve the environment for private sector first steps toward innovative partnerships and participation and getting access to carbon finance in CIFs, many challenges remain as imple- credits. The use of WBG instruments to address mentation gets under way. Extracting the lessons loan tenures, local currency financing, and from early implementation will be key. similar financial challenges would also be supported. Cities are at the forefront of low-emission action. l Promote good practice: Important actions here C40, a group of 40 major cities from developed and include promoting transparent contractual developing countries, has joined forces with the arrangements, carrying out baseline studies WBG, the Clinton Climate Initiative, and Local early on, adapting to risks during implemen- Governments for Sustainability to create a common tation, and getting the institutional international standard for measuring GHG emissions arrangements and policy incentives right. and tracking progress on targets. Developed country l Strengthen planning: These measures include cities—among them London, Madrid, New York, supporting governments in basin-wide and Sydney, Tokyo, and Toronto—have set a GHG cross-sectoral planning, improving data emission reduction target of around 10–30 percent collection and analysis, mainstreaming hydro- below 1990 levels by 2030. Developing countries have power into climate change programs, and similar reduction targets below 2000 emission levels. addressing climate impact management in São Paolo set an ambitious target of 30 percent below hydropower design. 2003 levels by 2012 (C40 Cities 2011). As part of the l Leverage regional development: Key mecha- new partnership with C40, the WBG will provide nisms include promoting multipurpose projects, knowledge from its recent work with developing enhancing multicountry power pools, exploring country cities and help increase climate finance for synergies among complementary projects, and cities. A “one-window access” for funding and sharing revenue. knowledge support is being explored. At the same time, the WBG’s Eco2 Cities program is promoting cities that are ecologically and economically sustainable. This approach begins with an Eco2 audit that diagnoses potential efficiency gains and emis- sions reductions as a basis for interventions that include retrofitting of infrastructure and buildings coupled with introducing new technologies. 2012–2022 | A World Bank Group Environment Strategy 59 Engagement in urban transport with a new Carbon Finance generation of projects is demonstrating the bus rapid transit as a low-cost green alternative. The Carbon finance remains a key tool in the effort to introduction of these bus systems as part of a more mitigate carbon emissions. Overall, carbon markets integrated public transportation system has been are fragile due to the uncertainty of the future of the piloted in a number of countries (including Mexico, Kyoto Protocol. However, as the world waits for Colombia, and China), helping to make public resolution on revision of the protocol and on a global transportation more efficient, affordable, and climate deal, there is a strong need to continue reliable. Countries like India are realizing that there developing the breadth and depth of the markets as are many growing cities with no formal bus system much as possible. as yet. The WBG plans to support expanding these pilots to include components that enhance the The Need for Carbon Markets “clean” elements of a comprehensive urban transpor- The U.N. Secretary General’s High Level Advisory tation program, such as an air quality monitoring Group on Climate Finance states that carbon and management plan, and its complementary markets are key in climate policy and that they must measures (for example, vehicle emission inspection play an increasing role in the future. Carbon markets and maintenance programs). can provide a price signal for GHG emissions, directing long-term investments toward clean Work to strengthen capture of co-benefits technologies and creating incentives for least-cost between greenhouse gas and local pollution abatement activities. A large part of climate finance emission reduction initiatives will continue. Many for developing countries can be mobilized through developing countries are aiming to reduce both carbon markets and channeled toward developing GHG and local pollution emissions. Studies for countries through instruments leveraging further China indicate that measures that lower air pollution flows of private capital. In this context, the Clean and greenhouse gas emissions simultaneously are Development Mechanism (CDM) is expected to much more cost–effective than those that focus only achieve 1.2 billion tons of CO2 emissions reductions on air pollution control measures to mitigate by 2012. This represents 40 percent of the emission negative health impacts. A smart mix of measures reductions expected to finally result from the Kyoto (such as energy efficiency improvements, cogen- Protocol (excluding the United States). It is estimated eration of heat and power, fuel substitution, and so that financial flows to developing countries of $27 on) that include actions that reduce energy billion have been committed to date through consumption can cut air pollution control costs and emissions reductions purchasing agreements achieve lower GHG emissions (Amann et al. 2008). (including post-2012 credits). This figure does not The WBG will continue efforts to identify and include any underlying investment finance flows. capture such co-benefits. Role of the World Bank Group The co-benefits agenda will be extended to also Different from other markets, carbon markets are in address short-lived climate forcers. The themselves a policy instrument, depending entirely emerging scientific evidence on the climate on policy making and regulation. They can only be impacts of short-lived climate forcers (SLCFs) such implemented if bridges can be built between the as black carbon and ozone, which were until climate policy process and the operational require- recently considered just local air pollutants, also ments of concrete mitigation activities. This provides a good opportunity to address climate bridging function is the role of the WBG in carbon change through WBG operations. It is increasingly markets, but, equally important, the World Bank is evident that addressing SLCF emissions from working to ensure that its low-income clients have transport, energy, and agriculture can help “buy access to carbon finance. time” for climate actions, given the short atmo- spheric life span but very high warming potential The World Bank has pioneered carbon markets and of such emissions. facilitated market access for developing countries 60 Toward a Green, Clean, and Resilient World for All since 1999, when it started activities to launch the and advance the policy and regulatory process to Prototype Carbon Fund. The Carbon Finance Unit of simplify rules and accelerate speed to market. the World Bank currently has under its management Second, the World Bank will support a continuation 12 carbon funds and two technical assistance trust of carbon market activity to assure that developing funds, with a combined capital that surpasses $2.7 countries retain their existing capacity, technical billion. The existing carbon offset project portfolio of knowledge, and carbon market infrastructure. Third, the Carbon Finance Unit includes 160 projects that the Bank will support building up the potential will purchase more than 200 million tons supply for a scaled-up future carbon market in order CO2-equivalent emissions reductions. to facilitate decision making on extended commit- ments and avoid possible future market The WBG has catalyzed the market and helped to dysfunctions resulting from supply shortages. pull in the private sector, including by developing new methodologies (such as carbon accounting Achieving the WBG’s objectives will require inputs to standards) and releasing them as public goods for CDM reform, conceptualization of new market project developers to use (to date contributing to 52 mechanisms, and potential bilateral piloting. such methodologies in 12 different sectors). Working Meanwhile, the WBG must further participate in the with partners, the World Bank has also been a key pioneering work to create innovative ways to use innovator in developing new concepts for carbon public finance to bridge the current period of uncer- crediting, such as programmatic CDM, and in tainty and to overcome market imperfections. This broadening carbon crediting into new areas, such as includes using public finance not only for the devel- land use, land use change, and forestry (LULUCF) opment of scaled-up carbon crediting schemes but and REDD+. also for initiating pilot purchases as an effective way of performance-based public spending, with the The World Bank’s Carbon Market Strategy option of recycling public funds by selling generated Developing access to carbon finance for low-income assets in a future compliance market. Implementation countries will be the centerpiece of the WBG’s will be met through a range of concrete new opera- strategy. The main challenge for the current carbon tional initiatives, including: market is how to rapidly move forward to a scaled-up ■■ Carbon Partnership Facility (CPF): A fund to scale market. The WBG’s strategic response is threefold: up investment in clean technology through First, it is important for the World Bank to encourage programmatic and sector-based approaches, CPF 2012–2022 | A World Bank Group Environment Strategy 61 uses programmatic approaches to scale up clients ensure that carbon finance is consistent emission reduction programs, which are included with development planning. The new initiatives in integrated financing packages linked to World are designed to address all categories of devel- Bank lending operations. oping countries (middle-income, low-income, ■■ Forest Carbon Partnership Facility: The FCPF is a forest-rich countries) and to support all relevant partnership and transparent platform for mean- carbon market developments (new mechanisms, ingful exchanges on REDD+ issues, as well as for including potential bilateral pilot phases and the generation of a new type of asset based on reformed CDM, LULUCF, and REDD+). avoided deforestation. It builds capacity and knowledge, preparing forest countries to partic- Climate Finance ipate in REDD+ by defining “readiness” and piloting financial incentives. Although carbon markets are one part of the solution ■■ Partnership for Market Readiness (PMR): The PMR to financing climate mitigation, they are not sufficient is a facility created to provide grant financing for for mitigation and do not address adaptation. At the building components of market readiness and to UNFCCC COP 16 meeting in Cancun, the world prepare for piloting new market instruments. It agreed to move toward greater financing of climate provides a forum for knowledge sharing, technical action with Fast Start Finance and a pledge to discussions, and collective innovation on new increase funding to $100 billion per year by 2020. market instruments, including development of Those attending the meeting also endorsed the domestic carbon markets. Increasingly, the PMR is establishment of the Green Climate Fund (GCF) to also a platform for examining the possibilities for channel this funding to developing countries. In carbon trading between domestic markets on a Durban, at COP 17, the platform adopted gave the bilateral or multilateral basis. GCF legal status and stipulated that the Board would ■■ BioCarbon Fund Tranche 3 (BioCF T3) (next be selected by March 2012 with an interim secretariat generation): The BioCF T3 will continue its in Bonn managed by UNFCCC and GEF. In addition, engagement in the forestry and agriculture the Durban platform agrees that the GCF should carbon markets as well as expand on-the-ground include a private sector facility and that bids for the implementation experience and the lessons permanent secretariat should be prepared by April learned from its predecessors in forest and 2012. In the advent of the GCF, the World Bank will agriculture carbon finance activities. The BioCF continue to work with other MDBs to pilot programs will continue developing new methodologies by for climate action through the CIFs. In addition, the pioneering activities in areas that have not yet WBG will continue to help policy makers and global been tested for land use but that have significant leaders think about how to raise the funding GHG mitigation potential. necessary for climate mitigation and adaptation. ■■ Carbon Initiative for Development (CI-Dev): The Together with the United Nations Development CI-Dev is currently taking stock of lessons Programme (UNDP), the World Bank has developed a learned with the carbon market experience in Climate Finance Options Platform with the objective micro-projects and least developed countries from of helping developing countries understand financing its predecessor, the Community Development CF, opportunities for climate action. The Bank also in order to continue promoting the development prepared a paper for the Group of 20 on climate of carbon markets with an emphasis on Africa. finance, examining the possibilities for raising funds The initiative will identify and develop the through fiscal policy, tax policy, and transfers. emission reductions assets and ensure the programs included will have a solid financial The WBG has also committed itself to track its own architecture by providing resources for capacity contributions to climate finance more accurately. building, technical assistance, and financing to The system for coding contributions to mitigation the seller entities behind the programs. and adaptation was developed by an MDB task force ■■ By supporting readiness for new areas and new in 2011. It is essential that all MDBs are using the market mechanisms, the World Bank can help same parameters for tracking investments in 62 Toward a Green, Clean, and Resilient World for All mitigation and adaptation, so that investments are Work to measure GHG emissions from the World comparable. The World Bank is providing training Bank Group’s portfolio will continue. The WBG is to staff in all regions to assist with future coding of advancing work on GHG analysis of investment projects linked to climate finance. Projects were projects. A corporate commitment to better under- retroactively coded for FY11 and, starting in FY12, all stand the GHG “footprint” of the WBG portfolio is projects will be coded for contributions to mitigation articulated in the Strategic Framework on and adaptation through the Bank’s business Development and Climate Change (SFDCC). The management system. SFDCC makes provision for the IFC to start port- folio-level assessments and for the World Bank to The IFC is integrating climate considerations into initiate pilot work on GHG analysis in energy, its activities across all industries and regions transport, and forestry sectors. and setting ambitious targets for its climate- friendly investments. The IFC goal is 20 percent The IFC has been expanding GHG accounting and of investments by FY13, with an aspiration of up to analysis of its portfolio and projects. As of February 25 percent. The climate change share of overall 2009, the IFC requires GHG emissions for all new, climate-focused advisory project expenditure is real-sector projects (but not for FIs and advisory expected to increase to 22 percent by FY13 and 26 services). Gross, or actual, project GHG emissions percent by FY14, from 9 percent in FY10. While the are calculated. This approach has enabled the IFC to IFC’s investment and advisory work in energy collect core data for all types of projects and to focus efficiency, renewable energy, and resource efficiency on integrating this work into the project cycle, will remain the mainstay of its climate change automating data collection, and conducting moni- activities, it also aims to grow its Cleantech venture toring and evaluation. In addition, as of FY12, the investment portfolio. IFC will assess the GHG reductions of its climate- related projects. The IFC’s approach is based on The IFC is working on several initiatives to mobilize definitions, methodologies, and tools developed commercial and concessional funding to support within IFC in consultation with other multilateral private sector climate investments in the form of financial institutions. The purpose is to evaluate the equity, debt, and technical assistance. These climate impacts of IFC mitigation projects in real complement continuing work with the CIFs and the sector projects, FIs, and advisory services. GEF. The IFC will continue to build on its innovative carbon finance mechanisms, including through the In parallel, GHG analysis is being piloted in select recently launched €150 million IFC Post-2012 energy, transport, and forestry sector projects at the Carbon Facility that will mobilize funds from World Bank, identifying methodologies that could European utilities and energy companies to help potentially be applied to a majority of the Bank’s extend carbon markets beyond 2012. lending portfolio across the three sectors. A number of technical issues remain to be resolved, including Understanding and Managing the the need to agree on assessment of net or gross World Bank Group’s Environmental emissions and definitions of project baselines and Impact boundaries. Additional work will be undertaken to test methodologies and tools in parallel with The WBG has taken great strides to ensure that its technical consultations. The World Bank will begin own environmental impact is minimized and offset. conducting GHG emissions analysis in mid-FY13 for These efforts will be rolled out to encompass all all energy, transport, and forestry projects that have country offices—that is, each office will strive to agreed methodologies and tools, while continuing to make its use of water and electricity more efficient test and develop approaches for additional sectors. It and to measure its carbon emissions. As with the is envisaged that GHG assessments for investment headquarters, the carbon emissions of country lending operations will be phased in as a World offices will also be offset, along with emissions Bank business requirement over two years starting from staff travel. in mid-FY13. 2012–2022 | A World Bank Group Environment Strategy 63 poverty and environmental challenges. Climate Supporting the Resilience change adaptation and disaster risk reduction are Agenda complementary and mutually reinforcing actions that promote better risk management. The Global The World Bank Group will integrate resilience Facility for Disaster Reduction and Recovery is into development. In a world undergoing accelerated already adopting climate adaptation as integral to its climate change and other sources of environmental business plans, and it supports 14 countries to and social stress, sustainable development requires formulate action plans integrating disaster risk a stronger focus on resilience. The WBG will reduction and climate adaptation. A 2010 joint World emphasize the importance of considering resilience Bank Group–United Nations report showed that and adaptation in all policy dialogue, sector invest- investing in preventive measures can lower vulner- ments, and knowledge work. This will require ability to natural hazards. That investment typically additional analysis on disaster risk management, costs countries significantly less than relief and resilient infrastructure, and adaptable agriculture rebuilding after disasters hit. Prevention is all the and a particular focus on small island states. Fully more needed given that the number of people consistent with this approach, the World Bank’s exposed to natural hazards in large cities could FY2012–2015 Country Partnership Strategy for double to 1.5 billion by 2050 (World Bank and UN Belize is entirely focused on supporting the govern- 2010). ment’s efforts to achieve inclusive and sustainable natural resource–based growth and enhanced In its approach to disaster risk management, the climate resilience that benefits all Belizeans. The WBG will work with clients to assess how to strategies for Tonga and the Maldives also have minimize the damage of natural disasters in terms strong elements of climate change. of loss of life and structural damage. For example, it might involve adapting infrastructure to floods with Strengthening the Focus on drainage systems that are more robust or to Disaster Risk Management droughts by checking that dams or irrigation systems can withstand lower water levels. The Bank Climate change is increasing the frequency and will also expand the use of instruments such as intensity of severe weather and changing the Deferred Drawdown Options to provide help patterns of rainfall. This has led to more-frequent recovering from natural disasters. In addition, the extreme events such as heatwaves, droughts, and WBG is pioneering work related to climate risk floods (IPCC 2011), which can in turn exacerbate insurance (such as Mongolia livestock insurance). Shutterstock 64 Toward a Green, Clean, and Resilient World for All Finally, revamping social protection systems, between adaptation and good development investing in women, and building social capital in programs. These include expanding work on communities are also essential for building resilient risk-pooling instruments through insurance communities that can endure a natural disaster and schemes, domestic savings from boom years to recover quickly. endow disaster funds, domestic taxes, and interna- tional transfer payments. Work on institutional and policy reform in cross-sector areas essential for climate- The World Bank Group will use a range of instru- resilient development will expand. As climate ments and financing opportunities to improve becomes more variable, the WBG will support policy governance and social accountability for and institutional reforms to ensure that climate- enhanced climate resilience. In addition to the related risks are adequately and continually grants and concessional loans of PPCR, the World addressed. The World Bank’s Social Development Bank is using DPLs and investment lending to Department and Innovative Financing Unit are support climate resilience. With all IDA Country collaborating in a review of evidence from weather- Assistance and Partnership Strategies expected to based insurance schemes to find out if they are address climate vulnerabilities, there will be promoting greater social and livelihood resilience in stronger strategic dialogues for addressing climate practice. Climate resiliency is incorporated in resilience as part of countries’ development multiple sectors—including agriculture, water planning. The World Bank has initiated some work resource management, and forests—in Indonesia, through DPLs at the city-wide level—for example in Vietnam, Brazil, and Mexico. Mexico City, where a DPL is helping to finance the city’s movement toward local climate-resilient The World Bank Group will sustain efforts to development. In Vietnam, the World Bank is mobilize additional resources for climate adap- working with local governments pioneering the use tation. The enormous financing gap for adaptation of social accountability approaches to ensure that means that resource mobilization efforts need to be incremental climate finance is put to effective use. expanded, particularly for the poorest and most In Mozambique, a recent DPL combines adaptation, vulnerable countries. One recent funding source is mitigation, and disaster risk management and the CIF’s Pilot Program for Climate Resilience. With brings together different financial flows for more than $900 million endorsed for 11 PPCR multiple sectors, such as agriculture, coastal zone programs (and the remaining 7 forthcoming), these management, and water resource management. In pilots are gathering momentum. The program the private sector, adaptation strategies for key operates in nine pilot countries and two regional sectors will be developed. Finally, in sub-Saharan programs in the Pacific and Caribbean, which cover Africa, clients are requesting a focus on capacity an additional nine countries (see Box 3.6 in Chapter building and improved policies. The World Bank will 3). In coming years, effective implementation, seek to translate its work on resilience into concrete monitoring, and distillation of lessons and sharing contributions to the planned medium-to-long-term of experiences will be critical to inform the demon- National Adaptation Programs under the UNFCCC. stration and scale-up—both within and beyond these It will continue to work with partners within countries. There is already compelling evidence that programs it administers, such as PPCR, and where a governance arrangements that have been put in joint results-matrix is effective for clients, the Bank, place in these programs through highly consultative and donors, as in the Pacific Island countries. and inclusive processes are worthy of replication. Strengthening Climate Adaptation The World Bank will work with partners to deliver Initiatives, Targeting Agriculture on the pilot experiences supported by the PPCR in 18 countries and will seek to expand these through Support to green, clean, and resilient agriculture additional transfers and by leveraging local devel- will be scaled up. With a 70-percent increase in opment finance, considering the complementarities food production needed by 2050, World Bank 2012–2022 | A World Bank Group Environment Strategy 65 support for agriculture will increase from an average country climate profiles to provide better infor- of $2.9 billion in 2006–08 to $4.5–6.4 billion from mation for decisions on climate-resilient 2012 and beyond. This will include a specific focus development. on agricultural programs that address the green, clean, and resilient dimensions. In Africa, the focus Co-benefits with the green and clean agendas is on enhancing productivity and land and water will be sought. The “triple-win” of climate-smart management. In Kenya, for example, programs agriculture contributing to resilience, low-carbon include support to community-based flood and growth, and food security implies important watershed management, arid lands management, synergies between adaptation and mitigation that weather and climate services, agricultural produc- need to be considered when designing and planning tivity and commercial agriculture, and pilot climate actions and evaluating their results. For investments on agriculture and forest carbon. In the example, forest carbon projects (reforestation and densely populated countries of South and East Asia, forest protection) that can be funded using incen- the focus is on sustainable intensification, value- tives for climate change mitigation can also added enhancement, and diversification. In contribute to adaptation by increasing the resilience Bangladesh, one of the most vulnerable countries to of local environments and communities. They extreme climate events, support emphasizes techno- contribute to strengthening the natural capital of logical innovation, including salinity and rural communities participating in projects by flood-tolerant rice in coastal areas, drought-tolerant recovering severely degraded lands, protecting rice, and water productivity approaches. In Brazil, water resources, and conserving biodiversity. The the emphasis is on balancing sustainable produc- African Union has committed to integrating climate- tivity increases with integrated soil fertility smart agriculture into the Comprehensive African management, addressing land and forest degra- Agricultural Development Program, an approach to dation (including GHG emissions from land use agricultural strategy and investment planning that change), and improved livestock management. has been endorsed by African Heads of State (AU and NEPAD 2010). Similar triple wins are possible in Support for adaptation programs by main- the oceans agenda—for example, protecting streaming and building from pilot experiences mangroves can lead to coastal protection, more will expand. With GEF support over the last decade, sustainable fishing for local communities, and the World Bank has backed projects that will serve biodiversity gains—and will be sought. as the basis for expanding support in tropical countries, islands, and drought-prone regions. In Opening Doors to Knowledge Latin America, for example, a number of pilot and Learning projects are improving information systems and capacity to anticipate extreme weather events. This The World Bank Group will continue to make the has included improved tropical storm monitoring latest knowledge and quality data available for systems and early warning systems. Involving local accelerating resilient development. Through the communities in planning for climate resilience in Climate Change Knowledge Portal (CCKP) (http:// Kiribati in the Pacific region has improved the climateknowledgeportal.worldbank.org), the World country’s capacity to deal with extremes like storm Bank will continue to provide access to climate surges. This approach has also been adopted in arid information; climate risk screening tools; adaptation areas (see Box 5.6), meeting food security and land options at specific location, country, and sectoral and water management needs. In some conflict and levels; and e-learning aimed at development profes- fragile countries where changing climate is an sionals. The portal allows policy makers to layer added stress, such as Somalia, Haiti, Afghanistan, potential climate impacts for their countries, and to and some countries in the Middle East, preliminary gain access to experiences of other countries in discussion is included in Interim Strategy Notes. As planning and adapting. The World Bank will partner part of the Bank’s broader work on climate change, with relevant specialized climate service agencies vulnerability assessments will be prepared as part of and organizations, such as the World Meteorological 66 Toward a Green, Clean, and Resilient World for All Organization and the U.K. Meteorological Office, to reinforce the site with data and models that are accessible to everyone and to provide examples of how that information and knowledge can be used in decision making. Several countries, including Mexico and Malawi, are also interested in having access to local versions of the CCKP in order to validate and upload local datasets and use of a global platform. The WBG is implementing a comprehensive Open Climate Data Initiative, led by a partnership of its Sustainable Development Network, Development Economics Data Group, and the Global Facility for Disaster Reduction and Recovery, to facilitate access to state-of-the-art climate data and innovative tools BOX 5.6 and frameworks for analyzing and managing Supporting climate-resilient climate change risk. The Open Data Climate Initiative, which includes the CCKP and the launch Development in the Sahel and of The Little Climate Data Book, allows for easy West Africa access to climate and climate-related data, including the latest country socioeconomic datasets to support In 2011, the GEF Council approved the Sahel and vulnerability and impact assessments. An asso- West Africa multisector program for $108 million. ciated competition (Apps4Climate) has already The program addresses major land degradation engaged app developers to bring in innovative ideas challenges common across the region. These on how to use the data more effectively and through include economic issues, such as food security, and mobile and web technologies. In addition, the Open environmental concerns like climate change. The Climate Data Initiative will promote inclusion of countries in the program include those in the Sahel/ country and client experiences in the need for Sahara region (Burkina Faso, Chad, Ethiopia, Mali, climate services. One example of this is the tech- Mauritania, Niger, Nigeria, Senegal, and Sudan, as nical assistance and its finding in the Sundarbans well as Benin, Togo, and Ghana) that have important mangrove system in India and Bangladesh. Linking savannah and forest systems linked to the Sahel/ clients that have used climate information for Sahara region. The goal is to expand sustainable decision making for resilient development in these land and water management in targeted landscapes mangrove systems with others in similar situations and in climate-vulnerable areas in West African and will be an important knowledge-brokering role for Sahelian countries through expansion of invest- the Bank. Other examples include climate resiliency ments in sustainable land and water management in agriculture and water sectors—both of importance technologies, thus improving land use spatial to many low- and middle-income countries. planning at the watershed scale. It will use a spatial approach called the “mosaic approach,” which links Support for capacity building, knowledge gener- productive landscapes, rangelands, parks, reserves, ation, and learning-by-doing on climate change and communal lands and considers increased adaptation will increase. The World Bank has a productivity, adaptation and mitigation to climate growing portfolio on climate adaptation, including change, and improved livelihoods. The focus will be through engagement with other MDBs on the PPCR. on managing trade-offs between multiple uses, These projects and programs include components such as demand for rich floodplains for grazing or supporting knowledge generation, targeted research, crops or woodlands’ value for firewood and the need and improved data gathering, access, and to retain watershed functions and protected areas. management. In the coming decade, systematic 2012–2022 | A World Bank Group Environment Strategy 67 Shutterstock drawing of lessons and sharing of experiences across Small Island States: Microcosms countries will support preparedness for managing for Green, Clean, and Resilient climate risks. The goal is to improve knowledge Development exchanges, for example on ecosystem-based adap- tation; hydro-meteorological services; integrated The small island states are among the most climate risk management approaches that link vulnerable to environmental and economic climate, disaster, and food security risks; and climate shocks due to climate variability and energy-price risk insurance mechanisms, including risk transfer, volatility. They present challenges and opportu- risk pooling, and strategies to enhance resilience of nities. With respect to climate shocks, many small specific groups, such as women, who have been islands are examining what they can do to protect shown to be vulnerable to the impacts of climate. their coastlines against erosion and rising sea levels. They are also facing the need for more resiliency in Region-specific resilience will be a key focus. disaster management, infrastructure, agriculture, Given the challenges of water scarcity in the Middle and energy. High expenditure on fossil fuel trans- East and in Arab countries, the WBG has scaled up lates into high energy prices of 20–40 cents per its technical assistance work on adaptation linked to kilowatt-hour, making renewable sources of energy water for that region. New knowledge and cost-competitive and offering the prospect of fiscal approaches to dealing with the risks of changing savings that could be redirected toward devel- climate on livelihoods, ecosystems, and economies opment and climate resilience. Although their small are also being explored. Learning and information size, remote location in cyclone-prone latitudes, exchange is being fostered between arid countries in small economies, and low-lying coastlines contribute the Middle East and countries in Latin America, for to their vulnerability, these factors may also poten- example, where growing demands require that tially contribute to their success as exemplars of better strategies for water management be planned. green, clean, and resilient development as they 68 Toward a Green, Clean, and Resilient World for All provide a relatively low-cost, high-value option 1:3). The WBG will therefore partner with small for demonstrating multisectoral sustainable island states in its Global Partnership for Oceans to development policy implementation at work. ensure that these nations are helping to set the The regional programs in the Pacific and the agenda on oceans while extracting the maximum Caribbean under PPCR provide a start, and in both sustainable value from their marine resources to cases the World Bank is working with other partners meet their development needs. This could include to scale up efforts in multiple countries. Work support for partnering on global advocacy, regional includes programs on climate-resilient infrastructure and national policy frameworks for better gover- and on ecosystem and community-based adaptation, nance of their EEZ, better management of seascapes especially in coastal areas. and marine protected areas, reduction of land-based pollution, investment options for alternative liveli- Through IDA and the PPCR, the World Bank and its hoods of traditional fishers (including aquaculture), partners are working regionally to assist the and coastal zone management harnessing (for Caribbean islands in addressing these issues, example, blue carbon revenues). but this work must be scaled up to include all island states. During IDA 15, the Regional The SIDS DOCK program exemplifies Green, Clean, Disaster Vulnerability Reduction Project was and Resilient approach to development. The SIDS approved by the Board under a single project for DOCK Support Program, developed by the Alliance Grenada and Saint Vincent and the Grenadines, of Small Island States, supported by a $29.5 million which was the largest project ever supported by envelope from Denmark and Japan and facilitated the World Bank in these countries. by UNDP and the World Bank, assists with the introduction of renewable energy and energy Small island states, in particular archipelagic efficiency among small island developing states. states, command disproportionately large It is focused on improving the enabling environment, exclusive economic zones (EEZ); they are “great removing barriers, and implementing policy reforms ocean states” and natural partners for the and business models with potential for scale up. A Bank’s initiative on a Global Partnership for growing project pipeline valued at over $25 million Oceans. For example, Tonga—a Pacific island state is leading to a wide-ranging and exciting portfolio consisting of 150 islands and a population of of innovative and socially inclusive developments, 100,000—has a land mass of 688 km2 and an EEZ of including a regional energy regulatory authority to 700,000 km2 , which is a 1:1000 ratio. This is equiv- overcome barriers, interisland power-supply inter- alent to the EEZ of the United Kingdom, which has a connectors to broaden energy markets, off-grid solar land mass of 243,000 km2 for a population of 62 for remote atolls to improve energy access, and million (a land mass to EEZ ratio of approximately achievement of Millennium Development Goals. 2012–2022 | A World Bank Group Environment Strategy 69 Shutterstock 6 6 Environmental Actions and Commitments from World Bank Group Regions Africa The Green Agenda in Africa Challenge. Africa presents both the biggest chal- monitoring, reporting, and donor coordination that many countries find hard to meet. Currently, Africa is home to less-developed coast- lines that still harbor intact ecosystems that protect lenge and the biggest opportunity for green action. coastal cities and infrastructure from flooding and While the continent has seen average annual provide protection for fisheries and shelter for deforestation rates fall to 0.5 percent in 2000–10, juvenile fish. However, seascapes are increasingly down from 0.6 percent in the previous decade, a threatened by human pressure. Destruction of considerable number of countries continue to coastal mangrove forests has increased the vulner- experience annual losses of forests and savannah ability of coastal settlements to flooding, and poor woodlands of over 2 percent. governance of fisheries has led to broad overexploi- tation of Africa’s commercial marine fisheries. As tropical forests and large savannahs are lost to agriculture and other developments, Africa’s biodi- Response. Africa has 14 countries with REDD+ versity is also disappearing. This not only affects readiness processes in place, including a country- environmental services on which much of the wide and a regional coordination mechanism. The population depends, but it threatens the nature-based World Bank Group’s strategy in the Region will be to tourism that is critical for employment and foreign work within these mechanisms, focusing on helping exchange earnings in many African countries. monitor progress by working with countries on the establishment of baseline measurements and MRV; The challenge for Africa in managing its forests is to helping clients plan at the micro level for extractive cope with the poor governance issues plaguing the industries, associated infrastructure, and land forestry sector and the fragmentation of external management; and helping set up rational protected funding. Pressures from agriculture, mining, and areas management to safeguard biodiversity. human settlements mix with the tempting money from illegal logging and wildlife trade. Together On deforestation, the World Bank will focus on with weak regulatory and enforcement institutions, improved management of forests, woodlands, and these factors create significant governance chal- farmland at a landscape level to contribute to rural lenges. Many of the newer funding sources for and urban economies and employment and to forestry, including the multidonor funds the Congo provide the ecosystem services that local people Basin Forest Fund, FCPF, Forest Investment depend on. The key to realizing the sustainable Program, and REDD, have focused on the global development potential of Africa’s forests and public goods role of forests rather than the domestic woodlands is improved governance at all levels: economic and local public goods role. And these enhancing the demand for good forest governance sources have come with complex requirements for from the private sector and local communities as 2012–2022 | A World Bank Group Environment Strategy 71 well as building the political will and the capacity of natural grazing lands. Within the coastal zone, the governments at national and decentralized levels to Africa Region will pursue activities that fulfill regulatory and enabling functions. maintain sustainable livelihoods of coastal communities. For fisheries specifically, Natural resources governance will be addressed the focus will be on strengthening governance, through development policy lending, technical adopting rights-based management, and enhancing assistance, and the Extractive Industries value-added in fisheries, coastal zone management, Transparency Initiative, while other tools will and aquaculture. continue to be pursued through partnerships as sector-wide approaches or as part of larger multi- The Clean Agenda in Africa sector policy loans. Challenge. Africa is dealing with the pollution To stem the tide of biodiversity loss, the focus will impacts of a long history of mining for gold, be on various types of sustainable land and water diamonds, uranium, chromium, nickel, bauxite, management production systems that have signif- cobalt, and coal. The mining sector is a major source icant biodiversity benefits, such as shade coffee, of employment and foreign exchange, yet years of cacao and tea plantations with native forest buffers, unsafe and environmentally destructive mining wetland rice, and livestock and game ranching on practices have polluted land and water bodies and 72 Toward a Green, Clean, and Resilient World for All threatened human health. This is a particularly Urban environmental sanitation upgrading will be difficult challenge in the artisanal mining sector, piloted in a few countries, initially in South Africa which is a major source of employment in the Region. and Ghana, while traditional financial support and technical assistance will be pursued in other Many of Africa’s largest mineral reserves countries. The Region will continue to support the remain unexploited and are located in the heart Lighting Africa initiative, a joint IFC and World of the Congo Basin or in other isolated, Bank program that helps develop commercial forest-covered lands or protected savannah. off-grid lighting markets in sub-Saharan Africa as Its rivers also remain relatively unexploited for part of the WBG’s wider efforts to improve access to hydropower. Despite the potential threats to these energy. Lighting Africa is mobilizing the private important ecosystems, Africa needs to carefully sector to build sustainable markets to provide safe, develop its hydropower and mineral resources to affordable, and modern off-grid lighting to 2.5 finance growth for development. The challenge is million people in Africa by 2012 and to 250 million doing this in a sustainable manner. people by 2030. A major challenge and opportunity comes The Resilience Agenda in Africa from Africa’s fast-growing cities. Some 62 percent of Africa’s urban population lives in slums, where and Challenge. The biggest challenge for Africa’s poor sanitation, drainage, and solid waste resilience rests in addressing its land and soil management pose substantial health risks and degradation, an increasingly severe problem that contribute to urban flooding, pooling of stagnant affects at least 485 million people in sub-Saharan water, and associated waterborne diseases. Africa. About 25 percent of the continent’s land area Low-lying coastal cities are especially vulnerable faces high to very high rates of soil degradation. to coastal flooding and climate change. Agricultural productivity is dependent on under- Untreated industrial and urban waste and lying soil fertility and availability of sufficient, wastewater is increasingly contaminating rivers, good-quality water. Soil degradation reduces fertility reducing the quality and availability of water for and productivity and reduces resilience by making productive purposes. these degraded soils more vulnerable to the impacts of drought, flood, and heat stress. Response . Managing the sustainable development of mining, oil, and gas (non-renewable natural Water scarcity is another major challenge. More resources), including social and environmental than half of Africa’s people live in areas facing water considerations and corporate social responsibility, scarcity or stress. And even though rivers are through extractive industries projects and technical abundant in much of the continent, sound watershed assistance will continue to be a priority of the WBG’s and river basin management is urgently needed. Africa Region. Response. The TerrAfrica partnership provides a Enhancing the enabling environment for vehicle for addressing bottlenecks, creating an responsible private sector investment will also enabling environment for mainstreaming and be important. Through technical assistance, the financing effective nationally driven sustainable Africa Region aims to ensure that transparent land management strategies through coalition environmental regulatory frameworks and building, knowledge management, and investments. competent institutions for monitoring environ- In parts of Mali, Niger, and Burkina Faso, there has mental compliance are available. been a massive regreening, due in large part to farmer-managed regeneration of tree cover as well New analytical work on hazardous waste, persistent as local innovations such as “zai” planting pits. organic pollutants, and the clean agenda overall will be undertaken. Projects that assist countries to meet Through the CIFs, the Pilot Program for Climate safeguards policy requirements will continue. Resilience aims to pilot and demonstrate ways in 2012–2022 | A World Bank Group Environment Strategy 73 which climate risk and resilience may be integrated into core development planning and implemen- East Asia and the Pacific tation. The pilot programs and projects implemented under the PPCR are country-led and build on Rapid economic growth, urbanization, and industri- National Adaptation Programs of Action and other alization combined with an unsustainable use of relevant country studies and strategies. the natural resource base are leading to degra- dation of air, water, land, and their related Coastal zone and flood mitigation is expected to environmental services in the East Asia and the become an area of increased investment, through Pacific (EAP) Region. This is threatening mainstreaming resilience into infrastructure and sustainable economic development and affecting subnational regional projects or through specific people’s health and livelihoods. Policy, institu- operations such as the proposed Senegal Flood tional, and related governance elements have not Prevention and Drainage Project. The World Bank’s evolved rapidly enough to cope with rapid changes, Africa Region will continue to provide assistance to nor has the implementation and enforcement river basin programs; new areas of intervention capacity of existing systems developed fast include country-specific water assistance strategies. enough. Global and regional environmental 74 Toward a Green, Clean, and Resilient World for All externalities have rapidly intensified, resulting The coastal and marine resource conservation and in a major environmental footprint of the Region management portfolio will further develop with combined attention to the recovery and sustain- As part of the overall strategy to address these ability of the resource base. Priorities will include challenges, the World Bank’s EAP Region will Indonesia, Vietnam, the Philippines, and the Pacific provide analytical support and technical assistance, Islands. Engagement in water-basin management and facilitate knowledge creation, including South- will continue, following an integrated land and water South collaboration; further develop the regional management approach, with larger-scale national- lending portfolio of environmental and natural level interventions in China, Vietnam, and the resources management operations; expand and Philippines and at the regional level through the deepen the mainstreaming of environmental integrated Mekong river basin management project. management in the regional sector lending program; facilitate financing through a combination of global The Clean Agenda in East Asia and environmental programs, lending products, and the Pacific other leveraged sources of environmental finance, including GEF; and further develop the regional Challenge. The EAP Region is an important source climate change portfolio with attention to synergies of GHG emissions and a major producer and between emissions reduction, climate adaptation, consumer of ozone-depleting substances. Some of its and disaster risk management. cities have the worst air pollution in the world. Many rivers are heavily polluted, resulting in direct The Green Agenda in East Asia and impacts on livelihoods, health, and the sustain- the Pacific ability of activities like agriculture and fisheries. Rapid population growth, increased income levels, Challenge. The “green” challenges facing the EAP and urbanization are triggering rapidly growing Region are significant and affect all ecosystems. In waste production. most countries in the Region, deforestation and forest degradation have been significant in the past Response. The EAP Region will expand its GHG 10 years. There has also been significant degra- emission reduction projects, with increased dation of the Region’s vast coastal and marine emphasis on sustainable urban development and habitats, including overexploitation of coastal and sustainable transportation. Renewable energy and marine resources, resulting in unsustainable energy efficiency will remain a strong part of the aquaculture practices and a significant loss of regional portfolio, with large investment programs productivity of capture fisheries. Watershed degra- and an active policy and institutional dialogue in dation has increased dramatically, leading to most countries. large-scale impacts on the availability and quality of land and water resources. These stresses combined The Region will expand policy dialogue, technical with demand for wildlife and other natural products assistance, and advisory services for the development have taken a toll on biodiversity. of carbon markets and for the mobilization of other sources of climate and green finance. It will pilot work Response. WBG activities to promote the green on technology transfer and MRV. The Region will agenda in EAP will include both demonstration and complete the transition from chlorofluorocarbons to scale-up projects. The Region will have a stronger hydrochlorofluorocarbons, with projects in China, forestry and sustainable forest management port- Vietnam, Indonesia, and Thailand to support the folio, reflected in increased climate and biodiversity implementation of the Hydrochlorofluorocarbon focus, particularly in China, Lao PDR, Indonesia, Phase-out Management Plan. and Vietnam. Expanded partnerships with NGOs, donors, and global programs, notably through the Addressing water pollution will be a major priority Greater Mekong Subregion Program and the broader through a large urban and rural water sanitation REDD+ and Global Tiger Initiative, will be a priority. program and broader approaches, such as water 2012–2022 | A World Bank Group Environment Strategy 75 basin pollution reduction in China and Vietnam. Response. A principal focus of ECA is sustainable The East Asia Seas programmatic GEF platform will forest management, with an emphasis on gover- contribute to these efforts. nance, the role of communities and the private sector, and conservation and environmental The Resilience Agenda in East Asia services, including carbon sequestration. In addition and the Pacific to a portfolio of forest investments, the program is supporting institutional reforms and capacity Challenge. The Region is highly vulnerable to building through improving Forest Law Enforcement short- and longer-term climate risks. Most coun- & Governance, innovative financing for sustainable tries in the Region (from the Pacific Islands to the forest management (such as payment for environ- Philippines, Vietnam, and Mongolia in particular) mental services in Albania and Kosovo), are extremely vulnerable to climate variability and afforestation and carbon finance (in Bulgaria, the associated increased frequency and impacts of Central Asia, Poland, Czech Republic, and Latvia), natural disasters. The resilience of water and and systems of forest inventories and tracking, as coastal systems and related urban and rural well as certification. livelihoods present countries with some of their most critical challenges. The Clean Agenda in Europe and Central Asia Response. To meet the resilience challenge, climate risk is increasingly reflected in the WBG’s lending Challenge. Relative to GDP, carbon emissions in portfolio through expanded mainstreaming in ECA are among the highest in the world. So the sectoral lending operations in most countries. In the Region faces dual challenges of managing its energy Philippines, Vietnam, and the Pacific Islands, security while maximizing options for cleaner attention will focus on linking disaster risk energy. Russia is one of the world’s largest carbon reduction and climate adaptation through joint dioxide emitters, and other countries in the Region programs and platforms. In the Pacific, priorities will have significant emission levels as well. But the include scaling up and enhancing effectiveness of region also faces a potential energy crunch. While partnerships, alignment, and harmonization. the financial crisis has provided some breathing Mainstreaming of adaptation in agriculture and room to address the potential energy constraints, coastal infrastructure will be a growing line of countries need to act quickly to take advantage of activity, with large operations expected in China, this window of opportunity by promoting an Vietnam, and the Philippines. Ecosystem-based attractive climate for investment. adaptation will be promoted in several countries through analytical work and pilot projects in Pollution management with shifting attention to new Vietnam, Lao PDR, and the Philippines. models for managing industrial pollution continues to be a major challenge in ECA. Meeting this challenge will involve addressing current and future Europe and Central Asia pollution flows and associated risks, as well as legacy pollution and brownfield regeneration. The The Green Agenda in Europe and cleanup, containment, and remediation of land, Central Asia ground, and surface water pollution remain important priorities in many countries. For EU Challenge. The challenge for the Europe and member states and accession countries, the EU Central Asia (ECA) Region will be maximizing requires adherence to community environmental wealth creation from natural resources and the standards and practices, as well as incentives for sustainability of natural resource-based economic governments to put in place adequate policies and activities. Forest resources are a major source of build capacity for mitigating existing damage and employment, timber, and ecological services in ECA. preventing future harm. 76 Toward a Green, Clean, and Resilient World for All Response. The ECA Region is engaged in a large migration of historical industrial pollution to and multifaceted program of energy supply residential areas. In Moldova, the Persistent Organic augmentation and modernization, with a significant Pollutants Stockpiles Management & Destruction focus on clean energy options. In a number of Project safely managed and disposed of stockpiles of countries, new “green economy” studies are being POPs, contaminated pesticides, and polychlorinated undertaken to assess the implications of imple- biphenyls (PCBs) from obsolete stockpiles and old menting EU policies on cleaner production and electrical equipment. And in Belarus, the Integrated consumption as well as climate change. In Turkey, Solid Waste Management Project includes a POPs the Private Sector Renewable Energy and Energy component to address PCBs and obsolete POPs Efficiency Project is helping increase privately pesticides in meeting the requirements of the owned and operated renewable energy production Stockholm Convention. within a market-based framework. And in the Ukraine, a new project is supporting investments in The Resilience Agenda in Europe and energy-saving measures in industrial companies, Central Asia municipalities, and municipally owned enterprises and energy service companies. Challenge. Much of the adaptation needed to make ECA more resilient to climate change has Efforts to address legacy pollution include a major substantial co-benefits. Improved water resource project in Kazakhstan to prevent the further management, better performing water utilities and 2012–2022 | A World Bank Group Environment Strategy 77 energy systems, and upgraded transportation large-scale afforestation in China offset the emis- infrastructure are needed, independent of climate sions from deforestation and degradation in Asia. change. The gains from improved agricultural practices would be many times more significant The Region’s long coastlines and wetlands, than the changes expected from climate change. extensive chain of biodiversity-rich coral reefs, and Similarly, cleaning up environmental hotspots, some of the world’s largest fisheries (in Peru and stepping up disaster management, and renewing Chile) are also under pressure. Threats from unsus- investment in hydro-meteorological services would tainable resource mining and pressures from coastal benefit individual welfare and economic output. real estate, pollution, infrastructure, and tourism development are further exacerbated by climate Response. The Region has launched programs for the change impacts (including more-frequent hurri- modernization of hydro-meteorological services in canes, floods, and sea-level rise). Russia, Moldova, and the countries of Central Asia. These programs also target enhanced emergency Response. LAC is strengthening its green agenda preparedness and planning and better institutional by undertaking analytical work to underpin the coordination in flood-prone river basins. economic value of functioning ecosystems, investing in biodiversity protection, and mobilizing In Turkey, after 15 years of investments in traditional innovative sources of financing, including through watershed rehabilitation, the World Bank’s ECA the linkage between biodiversity and climate Region is supporting the development of a National change. Through participation in the WAVES Basin Management Strategy to inform the govern- partnership, this work includes shifting toward ment’s longer-term investment program in greater recognition of the economic value of watershed rehabilitation and water management. ecosystems and biodiversity services and of the In Tajikistan (one of the most vulnerable countries high economic costs of their loss. It also supports to climate change in Central Asia), the PPCR is the management of protected areas (Brazil, Peru, providing focused financing to mainstream climate Bolivia, and the Organisation of Eastern Caribbean resilience across all development activities. States), the integration of biodiversity conservation into productive landscapes (Uruguay, Mexico, Improved pasture management is also helping build Brazil, and Panama), and the use of payments for climate resilience with projects in Tajikistan, the environmental services (Costa Rica, Mexico, and Kyrgyz Republic, and Kazakhstan. Brazil). Work will also be stepped up to meet the growing interest in forest carbon partnerships (REDD+, for example in Mexico and Costa Rica) Latin America and the Caribbean and forest investment programs (Mexico, Peru, and Brazil) to build institutional capacity, forest The Green Agenda in Latin America governance, and information, as well as invest- and the Caribbean ments in forest mitigation efforts. Challenge. The unique and rich biodiversity The Clean Agenda in Latin America resources of the Latin America and Caribbean and the Caribbean (LAC) Region continue to be under threat from settlements, inappropriate agriculture, logging, Challenge. The LAC Region continues to be and mining, as well as from inadequate protected plagued by persistent environmental health risks areas management. from urban air pollution, indoor air pollution, and inadequate access to improved water sources and LAC still has the world’s highest forest cover. sanitation, all of which result in higher health costs. However the LAC Region made the highest contri- bution to global GHG emissions from deforestation Rising industrial pollution combined with weak and forest degradation between 2000 and 2010 as monitoring and enforcement further compounds the 78 Toward a Green, Clean, and Resilient World for All contamination of air, water, and soil from emissions region. Priorities in this area include supporting and effluent discharges. The increase in prices of countries like Peru and Colombia to strengthen key metals and higher fuel prices are exacerbating their health evaluation analysis capacity in order to pollution and the negative environmental legacies help identify priorities for action. Supporting of the mining and hydropower sectors. countries like Argentina and Uruguay to strengthen their industrial pollution abatement and Several countries have weak environmental cleaner production processes is another key institutions and poor environmental governance. priority, while for Brazil, encouraging “green cities” Despite progress made to strengthen legal and by incorporating environmental considerations regulatory frameworks, monitoring and into urban planning and design is a key focus. enforcement remain a challenge, and incentives to improve environmental management are inad- The Resilience Agenda in Latin equate. Fiscal constraints in the aftermath of the America and the Caribbean financial crisis compound this challenge and make environmental enforcement budgets tighter. Challenge. Some of the countries most vulnerable to the effects of climate change, sea-level rise, and Response. LAC is the most urbanized region in the natural disasters are found in this Region. In many world, so support for countries to move toward a countries in LAC and in the Region as a whole, cleaner development path is a high priority for the GHG emissions from the transportation and energy 2012–2022 | A World Bank Group Environment Strategy 79 sectors are expected to rise in tandem with rising aggravated by increased degradation of water motorization rates. quality, which primarily affects the region’s poor. Response. LAC is increasingly addressing High population densities and economic and popu- the need for enhanced climate resilience by boosting lation growth concentrated in a narrow coastal strip work in adaptation, mitigation, and disaster risk have accentuated the pressures on natural resources management, using a variety of instruments. and environmentally sensitive ecosystems, putting Examples of this work include: further stress on water and land especially. This is ■■ Pioneering and developing low-carbon growth posing risks for future generations, undermining the strategies through changes in land use (including resource base that underpins growing economies, and smart agriculture) and in the energy, transpor- raising the costs of mitigating negative environmental tation, and waste management sectors (Mexico, impacts, especially in coastal zones that are degraded Brazil, and Colombia) due to overurbanization, industrialization, overfishing, ■■ Using Carbon Finance-Assist to help countries and tourism development. and subnational entities develop low-carbon growth strategies (Rio de Janeiro, Brazil) Response. MENA is responding to these challenges ■■ Providing support in the Nationally Appropriate in a variety of ways. One approach is through the Mitigation Actions process to help governments Region’s shared seas programs, which support identify new and country-driven mitigation environmental management capacity building of the opportunities (Mexico, Chile, Colombia, and riparian countries to address pollution reduction, Costa Rica) improved water and marine resources management, ■■ Developing climate change adaptation strategies renewable energy, and sustainable fisheries. This at subnational levels (Mexico and Brazil’s north- approach follows the successful implementation of a eastern region) number of projects, such as the Red Sea Strategic ■■ Supporting renewable energy and energy Action Program, the Mediterranean Technical efficiency investments (such as appliance effi- Assistance Program, and the most recent ciency in Mexico and Argentina, distributional Mediterranean Large Marine Ecosystem efficiency in Brazil, wind and solar energy in Strategic Partnership. Mexico, and small hydro through various carbon finance projects). The Region’s shared seas include the Mediterranean, the Red Sea and the Gulf of Aden, and the Arabian Gulf, and programs are under preparation for Middle East and North Africa each of these. The Green Agenda in the Middle East The MENA-Desert Ecosystems and Livelihoods and North Africa Program is a 10–15 year program, with multiple building blocks, that aims to enhance livelihoods Challenge. The long-term green challenge for the from desert ecosystems by harnessing their value in Middle East and North Africa (MENA) Region is to an environmentally and socially sustainable sustainably maximize wealth creation from fragile manner. It focuses on the Region’s natural deserts, natural resources. MENA countries have always which have unique and highly adapted ecosystems, been water-scarce, and climate change only rich with opportunities to improve livelihoods and increases the scarcity. Despite growing urban preserve biodiversity. populations, an average of 88 percent of MENA’s water resources are allocated to the agriculture The Clean Agenda in the Middle East sector, with only 7 percent going toward domestic and North Africa consumption. As urban and industrial consumption increases with standards of living, less water will Challenge. Air-, land-, and marine-based pollution be available for irrigation. Water scarcity is threaten MENA’s cities, waterways, and shared seas. 80 Toward a Green, Clean, and Resilient World for All Pollution-related health problems, particularly in the regional seas programs, work includes the urban and industrial centers, are a significant Mediterranean Environmental Sustainable challenge. Hazardous waste and POPs also pose a Development Program aiming to integrate envi- challenge in the Region. The economic cost of ronment within southern and eastern Mediterranean environmental degradation in MENA ranges from 2.1 country economic development agendas. The GEF has percent in Tunisia up to 11 percent in Iran, as esti- committed $50 million, and the Bank is supporting the mated by the World Bank in 2001 (World Bank 2001). preparation of projects to be submitted under the International Waters Program. Coastal zones also continue to deteriorate as a result of increased population coupled with unregulated The Gulf Environmental Partnership and Action development. These threats add to sources of Program aims to support environmental untreated pollution and damage the natural habitats management capacity building and enhanced that remain, degrading critical habitats and environmental cooperation among governments, the affecting the well-being of vulnerable coastal private sector, and civil society through knowledge communities and industries, such as fisheries. development and investments promotion. Response. MENA is taking a three-pronged approach Continued commercialization of low-carbon, to tackling the challenges to the clean agenda in the renewable energy options is another important goal Region: a regional seas approach with other regional for the Region. Concentrated solar power is closest and development partners, supporting shifts to cleaner to economically viable energy storage. It is therefore energy sources, and helping make the shift to cleaner in a strong position to become a long-term and smarter industrial and urban development. Under renewable energy option, without the need for fossil 2012–2022 | A World Bank Group Environment Strategy 81 fuel backup. The World Bank is working with the climate variability, and climate impacts as part of African Development Bank and other partners to their broader development challenges. For example, accelerate its expansion in the Region. Yemen has opted to be one of nine Pilot Program for Climate Resilience countries to plan and facilitate a Smarter urban design and development is also a national transition toward a climate-resilient priority. Building codes that drive greater water and development path. energy efficiencies, smart approaches to urban transport to reduce congestion, and integrated solid waste management that also reduces leaching and South Asia resulting groundwater contamination are important areas of focus. The Green Agenda in South Asia The Resilience Agenda in the Middle Challenge. The Environment Sustainability Index East and North Africa shows that the environmental performance of countries in the South Asia Region (SAR) lags Challenge. Managing vulnerability to climate behind other countries at similar per capita income change impacts like drought is a key challenge. levels. The poorest areas of the Region overlap with Countries in this Region have been living with the most environmentally stressed regions, with drought and water scarcity for generations, but high levels of soil erosion, highly variable rainfall, climate change increases the need for countries to and degraded forests. better understand the potential impacts and to integrate response About 80 percent of South Asia’s poor live in rural mechanisms into existing institutional frameworks. villages and depend on natural resources. Stubborn rural poverty is often a consequence of declining Response. The WBG is responding by generating resource productivity and poor natural resource and sharing knowledge about impacts and potential management, resulting in overgrazed pastures, soil solutions. A report entitled “Adaptation to a erosion, and watershed and forest degradation. Changing Climate in the Arab Countries” provides Recognizing the linkages between natural resource guidance on adaptation for all 22 Arab countries. management and rural livelihoods, most countries The background documents for this report will have introduced polices to improve the sustain- provide input to the Fifth Assessment Report by the ability of natural resource use, though policy Intergovernmental Panel on Climate Change implementation remains uneven. scheduled for 2013–14. The environmental impacts of forest degradation are Also, the WBG is supporting countries by gener- of heightened international concern. Most of South ating knowledge and providing technical assistance Asia’s endemic mammals and all its charismatic and investment support for water resource species (such as Royal Bengal tigers, Asian elephant, management. The Region has experience in efficient and Asiatic rhinoceros) are classified as either use of water for agriculture and wastewater reuse threatened or endangered. Loss of productivity as a that can be shared. Understanding better the result of natural resource degradation is associated existing sources of water and using these more with significant economic impacts. Land degra- efficiently to maximize productivity gains is crucial. dation across the region leads to annual losses Efforts to map groundwater resources and increase amounting to at least 7 percent of the value of the use of treated wastewater, and to analyze the output, which is sufficient to offset the gains from economic costs and environmental implications of innovation and infrastructure improvements. desalination, are under way. Response. The SAR Region is supporting the Third, the WBG is supporting individual countries promotion of environmental mainstreaming in key to better understand and address climate change, natural resource sectors and regional approaches to 82 Toward a Green, Clean, and Resilient World for All biodiversity conservation. Some examples include mitigating environmental risks. A Social and the following: Environmental Management Unit was set up ■■ Analytical Work: The Bhutan Country Sustainable within that department. With safeguard support Development Analysis measures the country’s from the World Bank, the National Road wealth, including natural, human-made, human, Development Agency in India established a and social capital. The analysis links natural transformative approach in the expansion of the resource management policies and the devel- rural road network to prevent ecosystem fragmen- opment agenda, such as scope for valuing and tation and reinstating connectivity. paying for ecological services. The study on ■■ Lending: An Adaptable Program Loan on promoting nature-based tourism for the Strengthening Regional Cooperation for Wildlife management of protected areas and elephant Protection in Asia supports the conservation and conservation in Sri Lanka explores how Sri protection of wildlife species in Bangladesh, Lanka’s exceptionally well endowed natural assets Bhutan, and Nepal. The project will help partici- can be used to generate revenue for conservation. pating governments build or enhance shared ■■ Safeguards Support: Support for the Pakistan capacity, institutions, knowledge, and incentives Punjab Irrigation DPL led to reforms aimed at for tackling illegal wildlife trade and other strengthening the capacity of the Punjab regional conservation threats to habitats in border Irrigation Department for assessing and areas. The government of Himachal Pradesh in 2012–2022 | A World Bank Group Environment Strategy 83 India has embarked on a program to make a opportunities. The Bank led the first compre- transformational shift toward a model of hensive study to improve the brick-making sector sustainable economic growth, at the core of which in Bangladesh and to introduce alternative is the objective to become carbon-neutral by 2020. technologies that consume less energy and emit lower level of pollutants and greenhouse gases. The Clean Agenda in South Asia ■■ Safeguards Support: The India: Punjab Rural Water Supply and Sanitation Project financed Challenge. Environmental health impacts are investments in rural water supply and drainage exerting a heavy toll on economies in SAR. improvement schemes to serve Punjab’s rural According to World Bank estimates, environmental populations. It incorporated requirements for degradation costs between 5 and 10 percent of GDP contractors to comply with regulations aimed at in India, Bangladesh, Nepal, and Pakistan. The mitigating negative environmental impacts of largest share of these costs is associated with such projects. The client commissioned envi- environmental health impacts, accounting for about ronmental impact studies in terrestrial 20 percent of the total burden of disease in the biodiversity, managed river flows and archeo- Region, comparable to malnutrition. logical and cultural resources, and conducted a review of the cumulative impact assessment of Environmental standards have emerged as one of hydropower development. the key factors determining global competitiveness, ■■ Lending: The National Ganga River Basin Project particularly in the pollution-intensive sectors that is the largest World Bank investment loan in the abound in the region (such as extractive industries, environment sector. The project aims at cleaning textiles, leather, and pharmaceuticals). Globalization and conserving the Ganga River through a has created further incentives to harness environ- multisector program, with the medium-term goal mental gains. The reputational risks associated with that no untreated municipal or industrial waste- environmental issues, coupled with the need for water will flow into the main stem of the river exporters to comply with international environ- after 2020. mental norms, have highlighted the importance of environmental issues to policy makers. The Resilience Agenda in South Asia New industrial policies and innovative public- Challenge. The SAR region is expected to face private partnerships are key to fostering socially and increased vulnerability to extreme climatic events, environmentally compliant industrialization and including more-intense weather, floods, and drought. sustainable growth, to enhancing competitiveness Climate change is also expected to reduce agricul- on world markets, and to avoiding irreversible tural productivity, potentially increasing impacts on the environment. malnutrition, decreasing water availability in many areas, and affecting people’s livelihoods negatively. Response. The SAR approach to the clean agenda in the region includes promoting structural transfor- An estimated 750 million people (more than 50 mations for reducing the costs of environmental percent of the Region’s population) have been degradation on human health and reducing affected by a natural disaster over the last 20 years, pollution from key sources. For example: resulting in more than 230,000 deaths and about $45 ■■ Analytical Work: Structural Change and Green billion in damages. Livelihoods are highly suscep- Industrial Growth in Pakistan identified opportu- tible to climate change impacts, due to high levels of nities to integrate environmental management poverty and population density, heavy reliance of into Pakistan’s industrial growth policies, reduce the economy on the monsoon, and susceptibility to the costs of environmental degradation, spur natural disasters. technological innovation, enhance product quality, reduce firms’ pollution-related financial Sea-level rise is another critical threat, particularly and reputational risks, and create new business for coastal India, the Maldives, Bangladesh, and Sri 84 Toward a Green, Clean, and Resilient World for All Lanka. Severe impacts are expected to challenge the ■■ Safeguards Support: One of several actions that region to undertake further adaptation measures was part of the safeguards support to enhance the that are consistent with, and enhance, the region’s Sindh Education Sector Reform Project’s positive development objectives of accelerating growth and environmental effects included hiring specialists improving living standards and incomes. to assess the flood and earthquake risks in the area. Their work led to interventions that included Response. SAR’s approach to the resilience agenda school seismic resistance structures and guide- includes increasing the resilience of ecosystems, lines to reduce the vulnerability of schools to infrastructure and highly vulnerable areas. floods, earthquakes, and other natural disasters. Examples of interventions include: ■■ Lending: The India Integrated Coastal Zone ■■ Analytical Work: Results from the report Management Project helps build the appropriate Climate Change Adaptation, Biodiversity institutional arrangements, capacity, and Conservation and Socio-Economic Development advanced knowledge systems for mapping and in the Sundarbans areas of West Bengal, India, delineation of hazard lines and ecologically and Bangladesh enabled investments of more sensitive areas, setting up a world-class national than $1 billion by the government of India in center for sustainable coastal zone management, West Bengal. The technical assistance also and preparing integrated coastal zone promoted a platform for dialogue between West management plans. The project will also help Bengal and Bangladesh regarding the pilot this approach in three coastal states— Sundarbans region. Gujarat, Orissa, and West Bengal. 2012–2022 | A World Bank Group Environment Strategy 85 Shutterstock 7 7 From Actions to Results Results Measurement A focus on results is at the heart of the World Bank Group’s approach to delivering programs and policy advice. Environmental and attributed to the actions of the World Bank Group alone. Indicators for these global outcomes and the baseline are detailed in Table 7.2. Finally, Table 7.3 sets input indicators and baselines that will help to monitor, at an aggregate level, the efficiency and natural resources management is no exception. effectiveness of the World Bank Group’s actions. The Measuring, monitoring, and demonstrating environ- results framework for the WBG Environment Strategy mental sustainability results of projects and contains 61 indicators: 20 global indicators, 34 output programs the WBG supports is critical for greener, and outcome indicators, and 7 input indicators. cleaner, more resilient growth and to make the best use of scarce development finance. Implementation Risks The results framework presented here is geared to support the Environment Strategy to deliver on Change of global environmental priorities. measurable results. It is organized in a structure that Implementation of the Strategy will require the groups indicators along the results chain. The results commitment of substantial resources from donor framework maps the actions discussed in Chapter 5 to countries. However, the global financial crisis that output and outcome results and proposes a number of has recently evolved into an economic crisis has not indicators to track progress over time at the project only put the eurozone in jeopardy, it may also lead to level (see Table 7.1). These indicators may be refined another recession, which could compromise the over time as the World Bank Group continues to commitment of developed countries to a strong standardize core sector indicators. (A core indicator is environmental and climate change agenda such as an output or outcome indicator that can be easily that proposed in the Strategy. Politically, the crisis measured and monitored at the project level and that may result in more-conservative donor governments can be aggregated across projects and countries; core that focus on reducing fiscal deficits, further indicators form part of the project’s results constraining their capacity to support developing framework.) As appropriate, baseline indicators of countries and resulting in reprioritization of national outcome and output results will be established during and global environmental issues and policies. To the first year of the Strategy implementation, consid- address these risks, the WBG would need to sharpen ering that the main purpose of the results framework its analytical and policy work to strengthen the is to measure the contribution of WBG-supported promotion of greening growth. The business case of actions to achieving green, clean, resilient growth the environment strategy would be to demonstrate during the 10-year period of Strategy implementation. how a green economy can create jobs and open new opportunities for technological innovation globally. Guiding the Bank Group’s actions are country and This would require the WBG to strengthen existing global level environmental outcomes that cannot be partnerships and develop new ones with MDBs, U.N. 2012–2022 | A World Bank Group Environment Strategy 87 agencies, civil society, and particularly the private inclusive participation in growth and environmental sector. Client countries may have an opportunity in policies, that attracts capital and entrepreneurial pushing forward the technological and political capacity for green business, and that facilitates free frontiers around greening growth. access to information and social accountability. Making the environmental agenda a key component Institutional and governance weaknesses . of an inclusive growth agenda could be particularly Institutional and governance weaknesses can fruitful in countries plagued by the natural resource constrain the results achieved in client countries. curse or affected by conflicts. Under the Strategy, the The WBG will seek to help countries become more WBG will give priority to supporting countries so strategic in addressing environmental issues. that they can realize the value of their environ- Managing institutional and governance risks in mental and ecosystem services through client countries will require an approach that participating in emerging markets and enhancing focuses on a few but critical priorities, that fosters management of natural resources and rents. 88 Toward a Green, Clean, and Resilient World for All Table 7.1 Results framework: Project-level results Strategic Actions Output and Outcome result Result Indicator Direction 1. Green Support countries on valuation of Incorporated environmental ●● Number of countries supported ecosystem services and wealth accounts in national account by the WBG in wealth accounting accounting, including health of systems that estimate comprehensive oceans and marine biodiversity wealth in their national account systems Leverage work on oceans, Partnerships to harmonize ●● Number of partnerships fisheries, marine ecosystems, and approaches to seafood certification including South-South collabo- coastal resources and mobilize “blue carbon” ration agreements with financial financing contribution by the WBG for sustainable development of Strengthened enforcement and fisheries, marine ecosystems, regulatory capacity for fishing and and coastal resources coastal zone management ●● Marine areas brought under biodiversity protection (ha) South-South collaboration facilitated through knowledge ●● Coastline and freshwater platforms on oceans brought under biodiversity protection (km) Expand financial and policy reform Increased client capacity to access ●● Number of countries supported support for natural resource financial resources for landscape by WBG in carbon finance newly management and biodiversity and forest management and for accessing forest carbon markets biodiversity protection or receiving “wildlife premiums” ●● Number of countries brought Attached “wildlife premium” to under EITI compliance as a climate finance result of WBG support Improved accountability and ●● Number of countries supported transparency of revenue by the WBG in controlling wildlife management through EITI crime that enforce CITES or in other ways control wildlife crime Strengthened systems to protect biodiversity and combat illegal wildlife trade and wildlife crime Strengthen capacity in strategic Improved effectiveness in ●● Areas brought under enhanced environmental assessment and protecting the environment, biodiversity protection (ha) country environmental analysis, conserving biodiversity, and including analysis on ecosystem reducing poverty and inequality in ●● New areas outside protected services WBG-supported projects areas managed as biodiversity- friendly (a) (ha) Coordinate with MDBs, GEF, and U.N. agencies to ensure a coherent ●● Area restored, afforested, or approach for environmental and reforested with support of the social safeguarding of REDD+ WBG (ha) activities ●● Number of forest officials Revitalize program focusing on trained with support of the WBG pricing biases, subsidies, and ●● A harmonized approach for market and trade barriers to applying environmental environmental goods and services; safeguards to REDD+ activities promotion of sustainable supply established chains ●● Number of target population Update and consolidate WB with land use or ownership safeguard policies rights recorded ●● Target land area with use or ownership rights recorded (ha) ●● Number of countries supported by the WBG on environmental policy, economic tools, and technological development that have established marketable permits and have reduced or eliminated harmful subsidies or barriers to transfer and to using win-win technologies ●● Number of IFC clients that monitor degradation or conversion of critical natural habitats 2012–2022 | A World Bank Group Environment Strategy 89 Strategic Actions Output and Outcome result Result Indicator Direction 2. Clean Support pollution management by Reduced pollution sources ●● Number of new sewer connec- strengthening environmental tions constructed under the health valuation analysis, Expanded use of clean cookstoves WBG project enhancing environmental governance frameworks and policy ●● Number of people trained to Increased bus rapid transit improve hygiene behavior or tools, and addressing environ- systems as a low-cost green mental legacies sanitation practices under the alternative WBG project Support improved nutrient management and control of Reduced river pollution ●● Number of people in urban areas agricultural runoff provided with access to regular solid waste collection under the project Continue support to addressing Reduced public health risks from legacy pollution and water basin legacy pollution and past industrial ●● Number of households cleanup activities, including enhanced benefiting from project management of persistent organic components that reduce indoor pollutants air pollution ●● Percentage of trips conducted Increase support to low-carbon Improved access of clients to using public transport that were development renewable energy facilitated by WBG support ●● Volume (mass) of biological Enhanced technical knowledge, oxygen demand pollution load capacity, and carbon market removed by treatment plant infrastructure of clients outlets financed under WBG projects (tons/year) Increased climate change co-benefits ●● Persistent organic pollutants and POPs-containing waste disposed of in an environmen- tally sound manner (b) (tons) ●● Amount of GHG emissions reduction generated with support of WBG special climate change finance instruments ●● Number of people newly gaining access to renewable electricity under the project by household connections ●● Generation capacity of renewable energy constructed (MW) Establish a WBG corporate Reduced environmental footprint ●● Sustainability targets and environmental management of WBG corporate activities progress metrics for WBG framework and accountability internal processes are set structures 90 Toward a Green, Clean, and Resilient World for All Strategic Actions Output and Outcome result Result Indicator Direction 3. Resilient Facilitate access to knowledge, Increased capacity of clients, small ●● Number of people provided with learning, and data on climate island states, and local commu- access to improved water information and climate risk nities to adapt to climate change sources by WB operations assessment and to manage climate-related incorporating climate resilience disaster risks Support policy and institutional ●● Percentage of hydropower reforms to promote resilient projects supported by the WBG development and incorporate that address river basin planning climate-related disaster risk and water use management in management planning and design Pioneer work on climate risk ●● Number of countries supported insurance by the WBG on natural disaster management and response ●● Area provided with new/improved Scale up support to agriculture to Enhanced productivity, irrigation and drainage services enhance soil fertility and land, value-added, and diversification (ha) forest, and water management in agricultural production ●● Number of beneficiaries who (smart-climate agriculture) have adopted improved technologies in agriculture operations that incorporate climate resilience ●● Land area brought under sustainable land management practices (c) (ha) ●● Number of land users, supported by the WBG project, who have adopted sustainable land management practices (a) This indicator measures the number of terrestrial hectares outside protected areas where, as a result of the World Bank operation, the site is managed at least in part to obtain biodiversity gains. An area defined as biodiversity-friendly complies with social and environmental standards in a way that respects civil and indigenous rights, maintains or enhances social and environmental conservation values, prohibits highly hazardous pesticides and invasive planting, and uses harvesting methods that meet national laws and international treaties on biodiversity signed by the country in which the site is located. (b) Persistent organic pollutants are defined by the Stockholm Convention. Associated guidance on environmentally sound manner is in line with international good practice. For example, the implementation of the Basel Convention is supported by the “Updated General Technical Guidelines for the Environmentally Sound Management of Wastes Consisting of, Containing or Contaminated with Persistent Organic Pollutants (POPs).” (c) Sustainable land management (SLM) includes the management of soil, water, vegetation, and livestock resources through the following activities: preserving and enhancing the productive capabilities of cropland, forestland, and pastures/grazing land; sustaining productive forest areas and forest reserves; maintaining the integrity of water conservation zones and watersheds for water supply and hydropower generation; protecting the ability of aquifers to serve the needs of farm and other productive activities; and rehabilitating degraded lands. SLM practices include approaches and technologies to enhance land quality. 2012–2022 | A World Bank Group Environment Strategy 91 Table 7.2 Results framework: Country-level and global results Global Outcome Indicators World Baseline Green Change in natural capital per capita (%, 1990–2005) 9 Adjusted net savings (% of GNI) 6 Forest area (% of land area) 31.1 Deforestation (average annual %, 1990–2010 ) 0.1 Terrestrial protected areas (% of land area) 12.5 Marine protected areas (% of world oceans, 2010) (a) 1.17 Bird species threatened (b) 571 Mammal species threatened (b) 1207 Plant species (higher) threatened (b) 4295 Clean CO2 emissions per capita (tons) 4.6 CO2 emissions per unit of GDP (kg/1000 of 2005 PPP $) 485.4 Electricity generated using fossil fuel (% of total) 67.2 Energy from biomass products and waste (% of total energy) 9.8 Particulate matter 10 microns (PM10) (micrograms per cubic meter; urb-pop, weighted-aver) 46 Annual freshwater withdrawals (% of internal resources) 9.0 Under-five mortality rate (per 1000) 61 Resilient Access to improved sanitation (% of total population) 61 Access to improved water source (% of total population) 87 Cereal yield (kg per ha) 3,566 Adjusted net national Income per capita of small island states (2009 $) 3,798 Source: World Bank 2011a, 2011b; (a) IUCN 2010, Table 3.1; (b) IUCN 2011, Table 4a. Unless otherwise indicated, the global indicators are for 2011. 92 Toward a Green, Clean, and Resilient World for All Table 7.3 Results framework: Operational effectiveness—input indicators IBRD IDA performance performance IDA baseline standard IBRD baseline standard Gender Parameter (a) FY2007–09 FY2012–14 FY2007–09 FY2012–14 Percentage of projects (mapped to Environment) with gender analysis, gender-inclusive consultation, or both 36 100 0 100 Project preparation speed (b) IBRD-IDA baseline FY 2011 IBRD-IDA FY 2015 Investment lending speed in months 10 – project concept development to approval IEG satisfactory/successful rating World Bankc World Bank IFCd baseline FY IFC baseline 2007-09 FY 2015 FY2015 FY 2002-2008 Percentage of projects rated satisfactory or 77 65 better Internal learning World Bank baseline FY 2011 World Bank FY 2015 Participant hours of environment mapped 7622 staff (e) AAA satisfactory/successful rating World Bank baseline FY 2010 World Bank FY 2015 Percentage of Analytical and Advisory 75 Activities’ objectives largely accomplished (f) Climate change parameters World Bank baseline World Bank FY 2015 Number of CASs that discuss climate Data to be reported starting in 2012 change vulnerabilities World Bank Group baseline FY 2010 World Bank FY 2015 GHG emissions in internal processes (tons 220,403 of carbon dioxide equivalent) (b) (carbon-neutral) Source: (a) Annex 1, Targets for Monitoring Progress in Gender Integration in Operations: Approach for the Sustainable Development Network, internal World Bank document, May 6, 2010. (b) World Bank. (c) Table E.5, IEG 2009. The percentage is of World Bank projects mapped to Environment. They are rated moderate, satisfactory, or highly satisfactory. (d) IEG 2011. A four-point scale is used to rate environmental and social effects (ESE) of IFC’s projects as unsatisfactory, partly satisfactory, satisfactory, or excellent. ESE is an indicator of environmental effectiveness that measures project performance in meeting IFC’s requirements and performance standards as well as their expected environmental and social impacts. (e) World Bank. (f) World Bank, based on Activity Completion Summary completed (89%) for Economic and Sector Work/Technical Assistance tasks mapped to the Environment Sector. 2012–2022 | A World Bank Group Environment Strategy 93 Shutterstock Annex 1: Actions by World Bank Group Sectors Addressing Environmental Sustainability Sector Priority actions Agriculture and Rural Development Reduce land degradation, improve agricultural water management, and sustain forest production to enhance sustainability of natural resource management by Agriculture accounts for about 75% of supporting: (b, c) global water withdrawals, about 25% of global GHG emissions (15% from livestock ●● Sustainable intensification of agriculture on high-potential land with restoration and crops and about 10% from defores- of watersheds and biodiversity (including forested) landscapes, use of new tation for crop area expansion), and about technologies 50% of global emissions of nitrous oxide ●● Crop breeding for heat, flood, and drought-resistant varieties and enhanced and methane. (a) productivity and agricultural diversification ●● Increasing the productivity of water use, addressing drainage and salinity, and controlling water pollution from agricultural runoff ●● Waste and loss reduction throughout the production and value chains ●● Integrated approaches to maintain and enhance organic matter/carbon content in the soil and aboveground biomass and to reduce water use ●● Multipurpose management of forests, woodlands, and rangelands that also help reduce GHG emissions and sequester carbon ●● Identification and promotion of best practices in forest processing to minimize carbon emissions ●● Value chains to enhance value added and productivity per unit of land, forests, and water ●● Improved access to and productivity of agricultural water and water for fisheries while maintaining adequate environmental flows and reducing GHG emissions ●● Enhanced food safety and food quality measures Enhance sustainable livestock and fisheries management by: ●● Managing livestock and supporting animal breeding, feeding, and husbandry, with manure management and biogas generation to conserve animal and human health and animal welfare and to reduce GHG emissions, pollution, and disease risks ●● Maintaining and protecting critical habitat for fish spawning ●● Strengthening governance, adopting rights-based management, and enhancing value-added in fisheries and aquaculture sectors Support price (for instance, for energy and water) and other policy measures that ensure moderate use of inputs while favoring sustainable land and water management Water Sustainably manage rivers, lakes, and groundwater systems and increase access to basic sanitation with specific actions that would include: About 15% of the world’s population does not have access to safe drinking water, ●● River basin, watershed, and integrated water resources management and about 40% does not have access to ●● Re-engagement in high-risk infrastructure to invest in water storage basic sanitation. The cost of water pollution and excessive withdrawals is not ●● Reuse of treated wastewater insignificant – estimates are 2–7% of GDP in the Middle East and North Africa ●● Water conservation Region. Projected changes from climate ●● Policy and institutional reform change are likely to increase the frequency and severity of floods and droughts, ●● Capacity building to scale up demand-driven sanitation approaches and adding to the pressures on the reliability strengthen sanitation supply of and access to clean water. Other ●● Investment in new technologies and innovation that improves efficiency of water pressures are likely to mean an increase use and increases availability of clean water and sanitation to poor populations in prevalence and extent of water- and vector-borne diseases and increased ●● Investments in early-stage water efficiency and water quality technologies and malnutrition.(d) enterprises ●● Water allocations for environmental use ●● Management of water pollution ●● Management of invasive species 96 Toward a Green, Clean, and Resilient World for All Sector Priority actions Energy Improve access and reliability of energy supply and facilitate the shift to more environmentally sustainable energy through: Hundreds of millions of households – women and children among them ●● Improving end-use energy efficiency and energy conservation – continue to rely on traditional use of ●● Increasing supply and demand side efficiencies solid fuels for cooking and heating and are exposed to dangerously high levels of ●● Considering high-efficiency measures and renewable energy harmful smoke. Energy-related GHG emissions are continuing to increase and ●● Reducing indoor air pollution from household fuel use by identifying and affect many aspects of environmental deploying clean cooking and heating solutions sustainability. (e) ●● Reducing air, water, and soil contamination ●● Protecting the ecosystem by strengthening and enforcing environmental standards and regulations ●● Investing in new technologies that improve the performance and lower the cost of clean energy alternatives ●● Helping adopt low-carbon technologies through capacity building, examination of alternatives, identifying and obtaining financing to buy down the incremental costs of low-carbon technology development, and adoption of new clean energy technologies ●● Establishing new targets on renewable energy and energy efficiency ●● Assessing vulnerability of hydropower to rising temperature, of energy infra- structure to extreme weather conditions, and of wind and solar to the effects of climate change; developing adaptation options to minimize adverse impacts Oil and Gas Policy (SEGOM) ●● Reduce natural gas venting and flaring, including reduction of un-combusted petroleum (particulates and ground contamination) by improving flaring policy The petroleum industry is a major and regulation through SEGOM-administrated Global Gas Flaring Reduction environmental factor, with effects on the public-private partnership. atmosphere, groundwater, coastal zones, and oceans. ●● Reduce groundwater contamination and improve hazardous waste management within petroleum operations. ●● Build environmental governance capacity in oil-producing developing countries. ●● Reduce GHG emissions from power generation by building government capacity to adopt policy, govern, and regulate new natural gas developments for alter- native supply to higher carbon-based power generation facilities and to reduce deforestation caused by use of biomass and charcoal as fuel. ●● Reduce risk of environmental damage by improving spill prevention and response. ●● Improve government policy on use of natural gas and liquefied petroleum gas for home heating and cooking. ●● Support private sector and national agencies’ capacity to respond to oil and gas emergencies. Transportation Reduce urban air pollution by: Motor vehicles generate 90% of urban air ●● Phasing out highly polluting vehicles; pollution. An estimated 800,000 people die ●● Improving public transportation, including inland railways and waterways; annually due to exposure to urban air pollution. The transportation sector ●● Urban road traffic demand management; accounts for about 15% of global GHG emissions. (f) ●● Support for non-motorized transport; and ●● Management of vehicular emissions. ●● Support a mix of policies to influence changes in travel behavior, logistics decisions, technology choices, and transportation modes. ●● Establish the governance, strategies, policies, and services that will deliver transportation that is economically, financially, environmentally, and socially sustainable. 2012–2022 | A World Bank Group Environment Strategy 97 Sector Priority actions Urban Promote a safe, sustainable urban environment and inclusive governance for all residents by: Given that almost half of the world’s population lives in urban areas, many ●● Fostering policy reforms and investments in solid waste management and urban urban issues are also the same as those air and water quality for water, energy, and transportation. An ●● Promoting a holistic approach to economic and ecological cities (Eco2) estimated 1.7 million deaths worldwide are attributed to unsafe water, sanitation, ●● Encouraging greater public awareness and adoption of broader metrics on and hygiene, particularly in densely sustainable cities populated urban and peri-urban areas. The urban poor living in high-density slum settlements experience higher exposure Reduce per capita GHG emissions and lower emissions of other air pollutants by: to a number of health, environmental, and ●● Advancing an international standard for measuring city GHG emissions, as part of disaster-related risks associated with an “urban metabolism” diagnostic poor drainage and solid waste management, indoor air pollution, and ●● Supporting city-wide approaches to carbon finance that integrate multiple proximity to often environmentally unsafe sectors areas. An estimated 70% percent of GHG ●● Implementing the Energy Efficient Cities Initiative (Energy Sector Management emissions come from cities. About 360 Assistance Program) million people live in urban areas in coastal zones and are vulnerable to the Given the large proportion of people in cities and the impacts of climate change and impacts of climate change. (g) other disasters: ●● Develop tools for analyzing urban risks and vulnerability, such as Urban Risk Assessment ●● Build knowledge and capacity among cities on adaptation, service delivery, and the urban poor ●● Support investments in hard infrastructure and other measures to increase resilience Social Development ●● Coherence at the level of policy and strategy between climate change, social protection, and disaster risk management in addressing social resilience People affect the environment they live in, and that environment has an effect on ●● Guidance based on knowledge sharing with Task Teams that are working on people. Human-induced climate change community driven development and social protection on pro-poor climate threatens the long-term resilience of resilience outcomes societies and communities. Climate ●● Guidance based on interaction and engagement with Task Teams on poverty and change is associated with complex social social impacts analyses linked to development policy operations that address responses, such as migration, conflict, climate change and human security. Pro-poor climate change adaptation needs to consider the ●● Guidance on benefit-sharing arrangements and gender aspects of REDD+ and human dimension, understanding the Community Bio-carbon Fund social differences (including gender and generational issues) and the influence of climate change on the most vulnerable. The growing importance of reducing emissions through preventing defores- tation and degradation has become a major element in planning the global response to climate change and maxi- mizing local livelihoods and local development co-benefits. (h) Manufacturing ●● Promote cleaner production through improvement of operational processes to make more-efficient use of raw materials, energy, and water along a value chain The manufacturing sector is one of the among IFC’s Cleaner Production Lending Facility clients. world’s most GHG-intensive industries. It is estimated that 22 percent of global GHG ●● Promote benchmarking of good/best practice for major industrial sectors. emissions come from the manufacturing ●● Identify potential sources of financing for resource efficiency investments sector. Many companies are facing rising energy prices or energy access issues. Industries that invest in projects to reduce emissions, enhance energy efficiency, utilize renewable energy sources, and reuse waste are therefore netting tangible business benefits through reduced operating costs and lower GHG emissions. 98 Toward a Green, Clean, and Resilient World for All Sector Priority actions Mining Reduce water and soil pollution. Demand from emerging markets is expected to keep commodity prices at high Minimize land take, protect against loss of habitat and biodiversity (directly and levels at least over the next few years. indirectly), and optimize rehabilitation through: There is a global movement on trans- parency (the Extractive Industries ●● Strengthened oversight capacity Transparency Initiative, for example, and the Natural Resources Charter), opening ●● Design and broad-based implementation of best practices opportunities for developing tools and ●● Long-term mechanisms to ensure post-mine pollution protection creating the space for governance reforms. Reduce energy intensity and decrease GHG emissions through increased efficiency of energy use, increased use of renewable energy, and recycling of materials. Information and Communications Encourage the use of ICTs in energy, transportation, agriculture, and water resource management sectors to derive efficiencies that in turn deliver carbon savings and Technology (ICT) reduced GHG emissions: It is estimated that the ICT sector ●● Develop sector strategies for the use of ICTs in these sectors, with a focus on contributes 2-3 percent of global GHG efficiency gains (these sector strategies will be captured in the new ICT Strategy emissions, though the share is growing as concise background papers). This will cover use of ICTs for smart metering and may already be much higher.(i) ICTs systems, grids, utility payments, logistics, and motors. affect the level of GHGs emitted within the sector, but their larger influence lies in ●● Develop with partners the concept of CleanTech incubators (identification and enabling energy efficiencies (mitigating development of climate change adaptation applications and green technology actions) in other sectors, reducing and in applications by local developers/entrepreneurs for local and global relevance). some cases eliminating GHG emissions in a given process or facility. As an enabler in ●● Provide policy guidance on the gathering and treatment of e-waste. other sectors, ICTs are estimated to deliver carbon savings five times larger than the total emissions from the entire ICT sector in 2020. By virtue of the efficiency and logic that comes from automation and the use of computer processors and digital networks and devices, ICTs can facilitate reductions in GHG emissions and energy consumption in all walks of life (such as energy smart grid/metering, smart home, Intelligent Transport Systems, and satellite remote sensing and monitoring). Infrastructure Continue the WBG’s core infrastructure business with its focus on access and growth, while maintaining a strong record on managing the environmental impacts Several external and internal trends are and risks associated with infrastructure projects: shaping the future of the WBG infra- structure agenda, bringing new ●● Maintenance of the core business will be guided by sector-specific interventions opportunities for change. Lack of access detailed in individual sector strategies, with a focus on increased effectiveness and aspirations for growth continue to fuel and selectivity at the country level. the expansion of demand for infra- structure, while the challenges of today’s world—including climate change and Use environmental considerations as an entry point to infrastructure project design, environmental concerns—call for more generating co-benefits between infrastructure and environment in support of complex and interconnected infrastructure “Green Growth” (green projects). solutions. The core of the Strategy lies in the WBG’s ability to maintain its level of ●● Examples of green infrastructure projects include green buildings, which commitment in infrastructure sectors in incorporate energy- and water-efficiency features and use green materials; light of these trends. integrated utility management, which reuses sludge and organic waste as biogas and fertilizer; and renewable energy, which reduces GHG emissions through displacement of more polluting forms of energy. ●● Several regions have identified the environment as a key priority for infrastructure going forward, including renewable energy investments, low-carbon infra- structure and sustainable urban systems in EAP, projects and knowledge addressing environmental and social sustainability in LAC, and a programmatic approach to green growth and climate change in SAR. 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