Investing in Human Capital to Accelerate the Green Transition
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Investing in Human Capital to Accelerate the Green Transition
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The fate of people and the planet are inextricably linked. Investing in people builds their resilience to climate change, equips them to mitigate greenhouse gas emissions, and accelerates the green transition.
At the 2023 World Bank-IMF Spring Meetings, representatives from government, academia, and the private sector stressed the importance of thinking creatively, working together, and providing more resources to improve human capital—the knowledge, skills, and health that people accumulate over their lives that enable them to achieve their potential.
In the face of climate change, inaction will lead to immense costs—especially for the poorest and most vulnerable.
Investing in human capital creates healthy and well-educated populations – education being the greatest predicator of climate-friendly behavior. Strong human capital endowments are often passed across generations and reduce inequality. They provide benefits that empower more people – particularly women – to fully contribute to climate solutions.
Accelerating progress requires adequate and equitable funding. This is especially true for the poorest and most vulnerable in developing countries who contribute the least to climate change, yet are the most affected by it. Sustainable and equitable financing requires focus, creativity, and cooperation between governments, philanthropy, the private sector, and multilateral organizations. Let’s work together to benefit people and the planet.
02:33 How human capital can deliver for people and the planet
06:00 Human capital and pro-poor climate solutions
09:51 Education for a greener future
15:25 Investing in human capital to drive climate action
20:12 Making a case for smart investments in human capital that help the planet
25:40 Raising money for climate spending in poor countries
36:26 The support from the World Bank
40:34 Live Q&A - Scaling up grassroots innovations / Climate education
47:53 How do we keep the momentum moving forward
49:40 Closure / Video explainer: Human Capital Project
Honorable ministers, ladies and gentlemen, hello and welcome to the 2023 Spring Meetings of the World Bank Group and IMF. I'm Shakuntala Santhiran, Shaks for short. Over the next hour, we'll be talking about human capital, the health, knowledge and skills that people acquire over their lifetime. More specifically, we'll be exploring the important links between human capital and climate change.
Remember, you can share your thoughts on this topic anytime using the hashtag #ReshapingDevelopment. Please use the QR code you see on the screens to post your questions, or if you're following us online, you can join the chat at live.worldbank.org. Now, there's been a lot of emphasis on the harmful effects of climate change on humans. What's less focused on is the important role that human capital can play in supporting climate action. How does a country prioritize investments in human capital to address the climate crisis and foster sustainable, resilient and inclusive development? We have some brilliant guests to help us explore this.
Our distinguished panel today includes Her Excellency Oulimata Sarr, who is Senegal's Minister of Economy, Planning and Cooperation. She's also the first and current chair of the Human Capital Project Network, which brings countries together to share knowledge and experience to tackle development challenges related to human capital. Dr. Andrew Steer is President and CEO of the Bezos Earth Fund, a $10 billion fund to address the pressing issues of climate change and nature. Dr. Esther Duflo is the Abdul Latif Jameel Professor of Poverty Alleviation and Development Economics at the Massachusetts Institute of Technology. She and her research partners were awarded the 2019 Nobel Prize in Economic Sciences for their work on global poverty issues. And Axel van Trotsenburg, who is Senior Managing Director here at the World Bank, responsible for development policy and partnerships. Thank you all so very much for being here with us today.
Minister Sarr, if we could start with you, please. The Human Capital Project Network held a closed-door session, the ministers of finance, planning and budget who belong to the network held a closed-door session just a short while ago, and you were focusing on how human capital can deliver for people and the planet. What were your big takeaways from the session?
Thank you so much, I am delighted to be here. I think the takeaway from the conclave can be summarized in four points. The first one is that we need to bring back the people and human beings at the center of the climate conversation. We talk about the numbers, we talk about the temperature, we talk about how much money we need, but all of those consequences have a face. It has a human narrative. Number one, I think it was important that we sit and we talk, share human capital stories. The second takeaway from the conclave is that it has to be evidence based. I think a lot of the countries shared some very good examples. President, Malpass talked to us and we talked about the CCDRs, the country climate assessments, as being evidence based, helping policy for all the countries that are dealing with climate. Third, the elephant in the room, financing. Who is funding the climate adaptation and mitigation? Are we funding it at scale? The conversation about concessional funding at scale for all the countries that are dealing with climate change, which we have to say it might not be our historical responsibility, but we have to pay for anything that is linked to climate mitigation and adaptation. And lastly, on the conclave, private sector has a key role to play. We talked about public sector, ministers were in the room, but we know that private sector has a critical role to play in the investment that is needed in renewable energy, in access to water, in education, in health. They need to be also brought to the conversation. That will be the four takeaways from the conclave earlier today.
Thank you very much. We'll be looking at funding a little later in our conversation. Were there any particular examples, ideas, solutions that stood out for you?
So many countries shared some lessons and some initiatives. Some had disaster risk reduction initiatives, some had some greening of some of their sectors, health, education, some talked about climate-resilient agriculture, renewable energy. I think that's why the network is so important because the human capital network allows different countries to come together and share successful initiatives, lessons learned, things that have worked, funding they were able to mobilize, their own internal resources, how they were able to redirect them. I think it gives us a very important space to share.
A vital exchange of knowledge and experience.
Esther, you and your partners, your colleagues, have done a lot of research into different climate change solutions and their impact on the poor. What does your research show about the importance of human capital in driving climate solutions that are pro poor? Because the poor are the most severely affected by the climate crisis.
Yes, I think that the nexus between climate change and people, as the Minister said, is, of course, essential. We tend to forget it in the macro conversation, talking about warming of the whole planet, but it can be summarized in three points. The first one is that climate change will potentially undermine the huge progress that has been made in the last 30 years in human capital in the low and middle-income countries, mainly by the effort of these countries themselves. It is estimated that at the high emission scenario, by 2100 we could have 73 extra deaths per 100 thousand people. What does this mean? To put it in perspective, it's the number of people who are dying every year from all infectious diseases combined. Imagine all of the efforts being made against tuberculosis, against malaria, against HIV AIDS being basically dwarfed by what's going to happen on climate. All of these extra deaths are in poor countries. In fact, the OECD will have a mild decrease in mortality in the high-emission scenario because most of OECD countries are in cold places where they are going to have less harsh winters. This is a tremendously unequal situation. The second part of the nexus is that human capital allows people, individuals and countries to be more resilient against shocks that happen to them, and in particular, climate change effects. We recently completed with Pascaline Dupas work in Ghana, where we show that when girls access high school and are able to go to high school, the infant mortality of their children is divided by two. There is an enormous effect of having access to high school on infant mortality, and the cognitive skills of their children also increases by the time they are five years old. Human capital is itself a guarantee to pass on the human capital to your children and to be protected against climate change simply because it allows people the flexibility of dealing with the new situation that climate change is providing. Third of all, we do need the ingenuity of 7 billion people and counting if we want to have a chance to find a solution, to find solutions, because there is not going to be one silver bullet, there is going to be tons of responses that are needed that are adequated to the problems at hand as well as to the local context. Where are these solutions going to come from if not from the people in developing countries? And how are people in those countries able to find these solutions unless they are healthy, unless they have high education, unless they know where the world is taking them? For these three reasons, this climate change and human capital are deeply interconnected.
Clearly, investing in human capital for a green transition makes sense in education, in retraining people for green jobs, in people's health, because change is not just going to happen. Technology and policies aren't just going to happen. We have to equip people to drive this change. I've heard you speak very passionately about the need for education for a greener future, Andrew, and you work very closely with the climate community. Do you think they understand the importance of human capital in this fight for their efforts?
Look, we're slowly making progress in this regard. At COP28 in Dubai later this year, there will be a day devoted to human capital and particularly education and its link to climate change. That is long overdue. Let me just commend you, by the way, for this event and this Spring Meeting. I was saying to Axel that I used to work for the World Bank. When I joined the World Bank, Spring Meetings and annual meetings were dull, gray suited, boring affairs. Look at this now. I mean, amazing. What we used to talk about was projects and ports and roads, and look at this. A meeting that brings together the two most exciting challenges of our time, development of human capital and climate change, together and understanding the synergies. Unless we understand the synergies, we will fail on both. Well done, [unintelligible] on the human capital, Mamta, on the human capital project, well done, Minister. The fact that there's a group of Finance and Economics Ministers discussing human capital in a technical way is absolutely great. This afternoon, I think, or this morning, we also had the Ministers of Finance working on climate change. They need to get together now. As Esther was saying, there's a very strong link between human capital and climate change. Obviously, there's a link that goes from climate change to human capital and it's bad, it's very bad for health, there's a lot of data on that now, it's actually not good for education. But the really new and interesting aspect is that if you want to address climate change, you have to address human capital. And let me suggest there's three roots, if you like. One is we need citizens that are going to demand action on climate change, so they need to understand climate change. In that regard, the environmental movement understands you need to train children and adults on the importance of climate change. But actually, as Esther was just saying, and you were saying as well, if you want to undertake the dynamic changes that we're going to need in our economy, in the 2030s and 2040s, are going to need flexible, well-trained, healthy people. It turns out, as I'm sure you know, that under current trends, half of all of those who are going to graduate from school in 2030 will be totally ill-equipped in order to enter the economy of the 2030s. That's a disgrace, and this is the month halfway through the Sustainable Development Goals. We need to address that. If you want to address climate change, you need an educated group of people, both the engineers, but also the flexible people that can adjust. But then third, and perhaps in many ways the most important of all, climate change is here and we need to adapt. If you want to adapt and you've got a million dollars to spend on it, don't buy cement and create another seawall, although that's a good thing sometimes. Spend it on education, just creating flexible, well-educated, numerate, literate people who can work in teams, who can solve problems. I dare say that everyone in this room could look back to some stage in their family's history when you had to, as a family, had to adapt to some shock. For me, it was 1886, and my great grandfather was a sheep farmer in the Hebrides in Scotland, little islands. 1886 was when the first refrigerated ships bringing lamb from New Zealand and Australia started heading towards the United Kingdom. Within ten years, the sheep industry in the Outer Hebrides was totally unprofitable and my great grandfather had no income. What did he do? He moved to the mainland and within ten years he and his family were up and running, much better off than they had been before. Why? Because they lived in a culture that was obsessed about education. They were flexible, the children were, the adults were, and they were healthy. They entered a new economy, and I'm here today because of them. In other words, adaptation can only take place if you have the human capital to do it. We just got to get that message throughout everything we do, so well done for bringing this together.
It's quite incredulous to me, actually. It seems very commonsensical you would think. We humans created the problem, we now need to fix the problem somehow, and surely people need to be at the center of the solution. Without it, we're not going to get anywhere. Axel, how does the World Bank see investing in people, in human capital to drive this climate action?
[Axel van Trotsenburg]
I think the previous speakers have quite clearly made the case why this is necessary. When you are thinking about climate change, you cannot think this, okay, we will need a politically correct thing to have the click something, and then you have done it. What it is about is to DNA the entire climate debate in your organization, whatever you do. The analysis, but also for the whole human development. But it is not only human development, it is across the entire organization. When you do these projects, you will need to think through this and look what the implications are. Therefore, when people are thinking it is not just about pollution, it is about the education, as you made that case. What is also very important is this is not a short-term undertaking, this is a long-term undertaking and a long-term commitment. As Andrew said, the scandal is that there are still many excluded from school and so many will never succeed in school because of malnutrition. They are born and they are denied a full life. I think that is why we need this investment, but we also need political leadership in the countries and we need joint commitment in organizations from the World Bank and elsewhere to make the necessary investments. That comes again back to the thing, is that the Minister Sarr just mentioned, that with all good intentions, it will require that governments step up, private organizations step up, parents step up, but also organizations step up in these commitments so that indeed we give them a fighting chance. What I think is our joint challenge is that unfortunately, the SDGs are on track, including on education, but in many other areas as well. Yesterday we had a discussion about hunger. It's a scandal that after 50 years, when the UN had the conference to eradicate hunger within ten years, we are here today and facing basically 8% or 9% of the world population going hungry. These are all sorts of things that we need to address and we need to address them urgently, and where we need certainly to keep the focus in that the poorest countries are unfortunately disproportionately affected by climate change. So yes, I do agree on the education, but when we are talking about climate-smart agriculture, they can be as smart as possible, but if we have distortionary trade policies with huge subsidy in the OECD countries, we may not actually give them a fair chance to succeed in their areas. We need to have a comprehensive approach, we need to be loud and clear also in our advocacy, but we all have to step up. What has been good is that the bank, we have been in the human development area stepping up decisively certainly during the last three years when COVID-19 hit and so many were excluded. One of the things I would like still to highlight that the results of COVID-19 we feel still today, and particularly girls, many, many stay out of school. What we need to do is a double tab, we need to look actually how we can actually bring back all those girls that left it and unfortunately are permanently out there. How can we include them and be far more inclusive on this? We have our work carved out for us. I believe we can, through effective coalitions, but also through effective aid, make up lost ground, but we have to be on this not only today but essentially for a generation or two.
And it has to be a whole government, whole society approach.
[Axel van Trotsenburg]
Not one part of the government and only one sector. Talking about working together, Andrew, you are no stranger to working in the public sector. You were with the World Bank, as you said, you were actually the World Bank's Special Envoy for Climate Change from 2010 to 2012 and also head of the World Bank in Vietnam and Indonesia for ten years. Now you're in the world of philanthropy. How can these two sectors work together and generate this much needed investment? Minister Sarr is talking about the need for funding. How can the two sectors work together and make a case for smarter investments in human capital that help the planet?
First, well done World Bank, in terms of moving the way you are moving with your evolution plan if you like. Because in some ways that's all about getting more leverage, and that's what we need to do much better. Whether it's philanthropy or whether it's private sector money, there needs to be a much more synergism with the multilateral resources, for example, in this building and the other regional banks and so on. We need to figure out a way of making every dollar… for us at the Bezos Earth Fund, we always like to say that each dollar that we provide as a grant has to do two things. It has to do what the narrow thing is, so if you're committed, we do nature and climate, if you're committing to do a certain thing in a certain part of the world you have to deliver that, and you have to be part of something bigger. You have to be part of creating a movement momentum that approaches a positive tipping point. That's how we need to think about this. We talk about blended finance a great deal, but actually we're not very sophisticated yet. For example, the philanthropic world needs to engage much more directly with the private sector and with the multilateral sector because if we work together, you actually would find some pretty exciting things. But just as we need partnership amongst these different sources of finance, we also need partnership across the different sectors in which we're working. For example, what Axel just said is so right, that it's not just human capital and climate change, there's food which is currently an absolute tragedy and they're all related, they're totally related. What we've been doing too much is thinking that we're almost competitors. I'm going to go and try and persuade this donor to give to climate change. Don't give so much to climate change, how about to human capital, or what about food? But actually, we should be more sophisticated and figure out actually in the climate world now there's quite a lot of money and there's quite a lot of political momentum. How can we, who care a great deal about human capital and currently the food situation, how can we tap into that? How can we be smarter to make each dollar double dip, if you like, so to speak? Because at the end of the day they are the same and I think there's some wonderful opportunities and we're seeing that starting to happen and I think you guys here are very much part of it.
How do you make it an attractive business case for investors? Because you can invest and help the climate and also get financial returns, right?
Right. I think the human capital business has something to learn from climate in this regard. 15 years ago, you couldn't get NGOs fighting for climate action to talk to CEOs of corporations. They regard them as the enemy. The corporations didn't really care very much about climate change. We now have a situation where 5000 companies have committed to net zero. $130 trillion of assets under management committed to net zero. Virtually every environmental organization works very closely with the corporate sector. Sadly, when it comes to human development, too much ideology comes in. In education, for example, it's like, oh my goodness me, if I'm an NGO on education I'm very, very wary about the private sector. Why? Because they're probably going to come in and make money out of it. Actually, that's the wrong approach totally. Who is it that needs education? It's the corporate sector, for heaven's sake. Every country ought to have a conversation with the corporate sector saying, what is the kind of skill set you need? And surprisingly, even though that's an obvious idea, you could have an amazing relationship. Very few countries do it. I bet Senegal does do it, Minister, but some countries are doing it well, but most are not doing it well. We just need to think much more imaginatively and get out of our ideological boxes, and instead think about what would it take to have a real solution, which is all about a system change. One of the things we do at the Bezos Earth Fund is we monitor the 50, five-zero, transitions that are required and we ask, where are they on the path towards a positive tipping point? How could we engage neurologically to remove barriers? We need to be thinking like that when it comes to the subject we're talking about.
Esther, you have an idea about how to raise money for climate spending in poor countries. As Axel rightly pointed out, poor countries are unequally affected, hurt a lot more by climate change than richer countries. You're talking about a very simple way forward, isn't there?
Yeah. Maybe as a complement to what Andrew just said, I think the bond of climate financing has been so far mostly dominated by an effort to voluntarily engage the private sector, which is all fine, but I think we also agree that it hasn't been enough. It also has been directed towards some projects against some others. For example, more mitigation than adaptation, in particular in developing countries. I think we need to set the stage and just remember a simple thing. It's been said, but it's worth saying it again. Most of the real costs of climate change are going to be experienced by people who live in poor countries. I mentioned it for mortality, this is going to be exclusively in poor countries. That's number one. Number two, however, the bulk of the emissions that are causing climate change today, and I'm not talking just about historical responsibility, I'm talking about what's happening today, is due to the behavior of richer people in the world, in particular, richer citizen of rich countries, although there are also some rich people in poor countries. Of course, we know that, and then we say, well, but China, India produces a lot of emission, that's true, but they export a lot of this emission in the service of producing the goods that the rich people in the world, us here, consume. In fact, there has been some work at the World Bank and other parallel work by Lucas Chancel at Sciences Po, trying to estimate for each person what their carbon footprint is as a function of their place in the income distribution, taking into account both the petrol of the car they drive but also the emission that went to produce that car and so on. Fortunately, the results are very simple to remember, so try to keep them in mind. The 10% highest polluters contribute 50% of the world's emission. The 50% lowest polluter contribute 10% of the world emission. Africa contributes essentially nothing. If we achieve the SDG of removing extreme poverty in the world, that would increase the total amount of emissions in the world by just 2%. In other words, there is no need to say, well, the poor countries also need to make an effort. It hardly registers. The problem is caused by people in rich countries. Now, of course that means that people in rich countries need to work on their emissions. It also means that we have a responsibility today to help poor countries adapt, cope with, which is a bit different than adapting, coping with is your house just flooded, what do you do? It's not about adaptation, it's about social protection in the face of the new oils that are created, and of course mitigate, leapfrog the bad investment that we've done. For that, of course, this is what we all agree, between us we can repeat that to each other, but I think we need to become serious about where the money is going to come from. Until now, from COP to COP we've committed to give money which we have not been given and this needs to change and this can only change now before the crisis is so big on us that we are not in a position to act. Why? Because we've seen during the COVID-19 crisis, when there is a true crisis, richer countries are like deer in the headlight. They are absolutely unable to do something else than deal with the immediate problem for themselves. During the COVID-19 crisis, richer countries spent 27% of their GDP on fiscal stimulus measure. Poorer countries, the poorest countries, according to the IMF, spent 2% of their GDP on fiscal stimulus measures. Not because they didn't realize there was nothing to be done, there was something to be done, they had no money. It's not that they can borrow in order to finance whatever it takes. The World Bank, the IMF, the OECD, did a little bit of an effort to try and fill this gap, but clearly not sufficiently. This is why it's so hard today for developing countries to get out of the crisis because it has plunged a lot of people in a poverty trap. Going back to climate, because the problem is so intimately linked to inequality between rich and poor countries, between rich and poor people, the solution also has to be linked to inequality. Therefore, any voluntary money that comes in, any ESG money that comes in, any philanthropic money that comes in is welcome. But we need to go beyond that, we need a mechanism that actually puts money into a fund for poor countries. Here's one, so ideally, in the ideal world, what would we do? Well, we could tax the richest people in the world in a very proportionate way and put that in the fund. That might be difficult because the institutions are not there to do that. What's another possibility? Tax corporations. Taxing corporations is possible. We are much more equipped in terms of institutions. The countries of the world are discussing to adopt a minimum taxation of 15% for all corporations. How about adding a person to that? Or even better, making the person slightly depend on the carbon footprint of the firm, the effort that they are actually doing, to some extent. Just this 1% would be enough if it was entirely devoted to the poor countries to finance the much-needed adaptation, to finance the much-needed social protection increases and to leave a lot of scope for innovation, for ideating the solutions that are going to potentially take us out of this problem. That is something which I think is feasible. Why do I think it's feasible? Because we're already discussing as countries, as coordinating fiscal policies. Everybody talks the right talk, it wouldn't take much to add the right action to that, and it is my hope that everyone here present can push in that direction to some extent.
What do you think, Minister Sarr, about what Esther was saying?
I think that a lot of people agree. As ministers of economy and finance, we had the conversation with a candidate that wants to be the President of the World Bank. I think the African countries in the room said three key words, we want business as usual, we want fast track and we want fair. The conversation around just energy transition is real. We cannot leapfrog from this to that without making sure that the human capital is following. The second thing I would like to add is that somebody mentioned the Sustainable Development Goals. As you know, in 2015 countries around the world agreed on an agenda. That agenda is coming very soon, 2030. We realize on the ground that there is a critical SDG that is really catalytic to all the 17. Do you know that the most important SDG is number…? Number five, gender equality and women empowerment. Why do I say that? Yes, the women in the room.
On climate, I give the example of Senegal on climate resilient agriculture. The body of research showed that if you skill a farmer to new techniques, to new technology, the women tend to retain and continue to replicate. We know that if we want to make sure that agriculture, food sovereignty, is sustained over a period of time, that the women farmers need to be skilled. That's why I always tell people, do you remember your SDGs? Because for us, whether we are talking about the Green Wall, that Senegal is part of this regional solution, and today in the Conclave, we talked about it. Some of the solutions have to be regional, multicountry. In the Sahel, particularly, there's this flagship program called le Grande Muraille Verte, the Green Great Wall, that is supposed to go from Senegal all the way to Djibouti. You know who are the anchors of that Great Green Wall initiatives? Women communities. They are the ones planting the trees, they are the ones making sure that those trees are not eaten by animals. We know that they play a central role in climate adaptation. Everything that we know we do; we have to make sure that they are part of it. That's what I wanted to add.
Okay. And so, we're hearing a lot of needs, Axel, for support, obviously for financing, and also to mobilize knowledge, to make smarter investments in human capital. How can the World Bank help? How will the World Bank respond?
[Axel van Trotsenburg]
I still would like to talk about the money and the ideas that are being floated. I think we know the needs are great, but the financing is falling short. Let's not forget that 50 years ago, the United Nations passed a resolution that industrialized countries should dedicate 0.7% of their GDP to development. That has only occurred in five countries, and development aid is rather sticky at the 0.33% level, with the added problem that more and more expenditures in the industrialized countries are counted, meaning everything being equal, less money for the poorest countries. That is the reality. I agree with Esther, there are many options that one could consider, but what we are facing today is a lack of political will to make the necessary investments. That is the principal problem. I think also in the discussion about the reform processes of the Bank, I'm asking every delegation, after six months after discussions, what is your ambition? What is the ambition where you want to see the World Bank in five or ten years? Do you want to see it flat, doubled, tripled? Or how should the World Bank respond to the challenges we are facing? Personally, I think we should be ambitious, hugely ambitious. Yes, that will require resources, but it is also that we need basically to get everybody around to stay engaged with developing countries. There is too much disengagement, and that engagement ultimately has to be translated in political will as well as money. I agree with the new partnerships that we need to create with the private sector, with philanthropy. Andrew, we are open for business. We can spend 5 billion of your money and we can sit together whenever you want, and we'll get the deals.
[Axel van Trotsenburg]
That's my challenge to you. I like that money, and we need the money. That is no problem. We can engage that, but that is only one form. I think we need to have a broad coalition and that is important that also philanthropy is in the advocacy part, and that is what we need from you, also, in seeing that we make the case and a lot more there. Now, on knowledge, I think clearly, we can learn from each other, and I think that we need to do more and more. The bank is not the bank. I always say the bank without ideas is bankrupt. We need ideas, we need the knowledge, we need to share this. I think this is an important part. But what we also need, apart from the ideas, the money we need to scale. The minister just mentioned the Green Wall in the Sahel zone. We are supporting that also with the Sahelian Women Empowerment project. It's a wonderful project. The problem is, in the five Sahelian countries, there are 82 million people living, half are women. We are reaching less than a million. We need to reach 10 million, we need to reach 20 million. That is the challenge. Therefore, I think we need new coalitions, be it also with the private sector, but ultimately an effort that is much, much greater.
You're talking about the need for scale. That's actually in one of the audience questions that we've received, and we've received many before and during the broadcast. This question says, it's an anonymous viewer, that there are a lot of grassroots innovations taking place by vulnerable groups that face the direct impacts of climate change on a daily basis. How can research and multilaterals like the World Bank learn from these innovations to scale them up? Esther.
I think that's a fantastic question. It's really important. We mentioned it, again, the ideas have to come from people who are experiencing the problems. And again, we need to go beyond mentioning it and see what we are doing about it. Actually, there have been efforts at the World Bank in particular with the DIME Initiative, at USAID it was DIV, with the French Development Agency with FID, and in my own organization J-PAL with K-CAI, to open the field for ideas that are emerging straight from the actors in developing countries. That can be activists, that can be companies, that can be government, they can be NGOs to come up with ideas, to have easy access to resources, to ideate things, pilot them, test them at a larger scale, and then scale them up when they work. For example, from the vantage point of FID in France, we have seen ideas coming out of regions in the Sahel, in Francophone Africa that had been mostly left out of this kind of ecosystem of innovation coming up, and wonderful ideas, small and large, to address and adapt to climate change. This support of innovation, again, it needs to go beyond words, it has to be money, logistical support and work to work together with researchers and people on the ground. This is ongoing, and it needs to expand. Part of the action of a fund that is devoted to fighting climate change and adapting to emission in poor countries would be supporting grassroots innovation and making sure that they are evaluated and skilled.
Andrew, you wanted to jump in.
Your question is absolutely 100% right. What is it? Between 5% and 10% of money for adaptation goes to the people that are the best equipped to do it. We should always ask the question, I'm sure the World Bank does now, always ask the question, is it possible to get this money closer to the front line? The vast majority of money that is part of a great development endeavor doesn't get close to the front line. We've made progress, and that's why we haven't spoken much about social protection, but the ability now to get cash to individuals through their telephones, to communities through their telephones and other ways, there's a revolution in the making, but it's not going fast enough. Minister Sarr mentioned the wonderful story of landscape restoration in Africa. The Great Green Wall, also Africa 100, (AFR100) 100 million hectares to be restored by 2030. Who's going to do the restoration? There'll be a few big companies, but the vast majority will be done by tens of thousands of farmers groups, cooperatives, NGOs, individual farmers and so on. How do you get the money to them? We had a meeting this morning with Donald Kaberuka and a team of Africans. What sort of intermediating institutions could we put in place in Africa to make sure that 90% goes to the people that could most use it? We, for example, also believe, like you do, in voluntary carbon markets and actually mandatory carbon markets. But the problem is, poor people in the countries getting investments don't get anywhere near the seat at the table. We this month gave $9 million to help indigenous people in the Amazon actually get a seat at the table, giving them legal advice, training them, but then, above all, giving them the capacity to actually engage so that they are able to get their fair share of anything. This is a revolution in the making, but we've got to accelerate it.
Axel, what can the World Bank learn from vulnerable groups?
[Axel van Trotsenburg]
First of all, I think that the attitude should be as open as possible and that you have to adapt constantly to new developments. I think that what you just mentioned on digitalization, this has helped us with the social protection measures, particularly during the food crisis, reaching tens of millions of people because we were able to transfer the money to their accounts. This has been a huge improvement, and we need to have that together. I think what we need also is to be always on the ground. I think the good thing is that we are now, in all countries, where we're operating is on the ground. Because when you are dealing with the realities in the countries, you can learn from it, you can understand it better and you can react better. This is also a case that we are moving. Take for example, East Asia, we have 80% of the staff in the field and that is what we need to make sure that you actually can immediately get feedback and learn from this. Then I think where I agree with Esther is that we need to do the impact evaluations much more systematically because it provides a very valuable learning tool, how you can better adjust, but also then correct for weaknesses in the design of projects. This is something that we are doing clearly, but we need to do much, much more. But I think there is a lot of openness and interest because at the end of the day, results matter.
Results definitely matter and we need results urgently. We've been talking about different ways to invest in human capital. Education has come up as a very important aspect here. We have a question from another viewer, Mohammed Nadeem. Why not make climate education mandatory? Would you like to take that? Esther, you want to take that?
All in favor? Does anybody disagree?
Andrew? Who wants mandatory climate change education? It makes sense.
Yes, we should do it. Yes, I mean, it's for each individual country to make that decision. Obviously, it's for the education.
[Axel van Trotsenburg]
This education, because we are dealing here with the World Bank, so people think this is mandatory for developing countries. I would like to have that in developed countries because as you say, the problem is mainly in developed countries. Let's start the education there and certainly expand it, but should not be an advice only for developing countries. It should start here.
Very good. We're going to have to wrap up our conversation soon, unfortunately. Minister Sarr, your closing thoughts. We've had a thought-provoking conversation, a lot of ideas, perspectives shared. How do we keep the momentum moving forward from our private sector, from the public sector, from academia? And what role can the human capital project play?
It's very clear from our conversation today that the approach has to be holistic. We talked about policy, we talked about skills, financing, technology, basic infrastructure. Today, from the conclave, every single country had some very good examples. I think that the network gives us that platform to share knowledge, to create a community. I think it allows us also to save time. We said this whole week, development cannot wait. We are in a dire situation. A lot of our countries just got out of COVID-19, and then we are facing the consequences of the climate, of the war in Ukraine, of violent extremism in the Sahel. The theme of this week is a sense of urgency. I think in order to move the needle, we need to know how to eat the elephant. Do you know how you eat an elephant? You have to eat it into pieces. Today we have to make the list of things that can be short term and eaten today, and then the medium and long term, but definitely the message that we have no time and development cannot wait.
Thank you very much, Minister Sarr. Thank you all so very much indeed for sharing your expertise and insights with us. There's clearly much to be done. We hope that this conversation has sparked ideas and inspiration and shown the value and necessity of investing in people, in human capital, to make progress in solving our urgent climate crisis, to create a virtual cycle between people and planet, a double dividend benefiting both humans and our planet. You can watch a replay of this session and all our other events at live.worldbank.org/springmeetings2023. Please do keep sharing your comments online with the hashtag #Reshapingdevelopment, we'd love to hear from you. If you're interested in learning more about building and investing in human capital, a valuable resource is the Human Capital Project. Find out more via this link, worldbank.org/humancapital and in this short video. Thanks for watching.
"We talk about the numbers, we talk about the temperature, we talk about how much money we need – but all of those consequences have a human narrative."
– Oulimata Sarr
“Because the [climate change] problem is so intimately linked to inequality between rich and poor countries, between rich and poor people, the solution also has to be linked to inequality. We need a mechanism that puts money into a fund for poor countries.”
– Esther Duflo
“Climate change is here and we need to adapt. If you want to adapt and you've got a million dollars to spend, spend it on education creating flexible, well-educated, numerate, literate people who can work in teams to solve problems.”
– Andrew Steer
“What is the ambition? How should the World Bank respond to the challenges we are facing? Personally, I think we should be ambitious, hugely ambitious. It will require resources, and staying engaged with developing countries.”
– Axel van Trotsenburg
Human Capital & Climate
The World Bank is committed to enhancing human capital and leveraging education to build climate resilience and mitigate climate impacts through its projects. Please refer to this for more information: thedocs.worldbank.org/...
As a concrete example, Payments for Environmental Services (PES) are cash transfers that support behavioral changes to manage critical ecosystems such as forests and small-scale fishery. Mexico’s Pago Por Servicios Ambientales, for example, pays communities to provide land conservation services. These cash transfers are also a key element for Just Transition policies and can help to address poverty while protecting the environment. See the following paper for further information related to Social Protection and Climate Change Adaption and Mitigation:
Adaptation Skills: Human capital development, (flexible, solve probling educated citizens aware of what are the challenges of climate change) will enable individuals to develop skills that help us adapt to changing climate conditions, shocks. Skills related to sustainable agriculture, water management, disaster preparedness, and renewable energy, among others. By equipping individuals , all individuals with the necessary knowledge and skills to adapt to the impacts of climate change.
Further, with a climate finance commitment of 35% of all lending finance in Bank operations (including Education projects), every project is screened for climate risk and incorporates actions to build climate resilience based on the project type. For instance, investments in school infrastructure focus on climate resilient building materials and design, local design components to minimize impacts of extreme heat, climate-informed location selection and design, and so on.
More information on leveraging education for building climate resilience and addressing the climate challenge: blogs.worldbank.org/... and blogs.worldbank.org/...
The World Bank is committed to enhancing human capital and leveraging education to build climate resilience and mitigate climate impacts through its projects. Please refer to this for more information on how education is being leveraged to address the climate challenge: thedocs.worldbank.org/...
More information on the World Bank’s approach to scaling up climate smart agriculture: www.worldbank.org/...
Learn more about the World Bank’s Human Capital Project here: www.worldbank.org/...
For more information about our work on climate, visit: www.worldbank.org/...
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Spring Meetings 2023
Join us for a series of live events on today’s pressing development challenges.
Throughout the Spring Meetings, The Zone provides a round-up of all the week’s happenings.