The first South American country to join the OECD, Chile is one to the fastest growing Latin American economies. But despite making considerable progress in reducing poverty, inequality is still a massive challenge needing to be faced.
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Working towards global carbon tradingThe good news is that an increasing number of countries, provinces and cities around the globe are developing and building schemes to reduce emissions and trade th... Show More +e resulting carbon reductions. Supporting national or subnational governments to put in place these mechanisms must be a priority. Many will want to participate in some level of trading across markets and some are already entering into formal bilateral negotiations to that effect. Adoption of common approaches and frameworks will facilitate linking and significant efforts to share experience and ideas are ongoing. However, recognising that countries will choose the most appropriate approach for their national circumstances and that the result is likely to be some level of heterogeneity across markets, a flexible approach is needed. We need an approach that recognises and accommodates differences across counties and that will support efficient trading across current and yet-to-emerge heterogeneous domestic and regional carbon markets and a range of asset types. As these developments unfold, we believe it is worth exploring the idea of a globally-networked carbon market with: pricing and exchange rates to support fungibility across asset classes; a reserve carbon “currency” for conversion and trading of emission reduction assets; and services and institutions to support a market of global scale. Of course, the principle of environmental integrity would need to underpin any effort of this sort.Possible elements could include independent carbon asset rating systems to provide information to the market and domestic regulators on relative risk and environmental integrity or an International Carbon Reserve supporting, as needed, domestic and regional reserves to help avoid extreme price swings. It could have a clearing-house function to establish exchange rates and possibly act as market-maker for new assets. It could also oversee a cross-border settlement platform to track cross-border trades and holdings of various carbon asset classes.But there are those who doubt that any form of carbon market could still work. What gives us confidence is the level of innovation in countries exploring domestic market mechanisms. There is evidence that carbon pricing can work if it is flexible and aligned with national policy initiatives, in particular economic priorities.While prices in major existing carbon markets like the EU Emissions Trading System flounder, many new national carbon pricing initiatives are emerging. And, not surprisingly, among the new carbon pricing initiatives, many include design features to manage extreme price volatility. The Partnership for Market Readiness In March, the Bank hosted a meeting of the Partnership for Market Readiness (PMR) – a growing coalition of over 30 developed and developing countries working on various solutions to carbon pricing. The World Bank acts as secretariat, trustee and principle delivery partner for the initiative. We are seeing more and more countries taking innovative domestic action.China is showing extraordinary leadership in this field. China’s seven pilot programmes – capturing between them five cities and two provinces with a total population of 246 million and accounting for a cumulative GDP of $1.6 trillion – are planned to launch this year. Shenzhen will launch its pilot in June 2013; Beijing and Shanghai will follow shortly thereafter. These pilots will pave the way for establishing a national carbon market, and China is already looking ahead to how it might link its ETS with others.The PMR is also supporting Chile, which is putting in place the necessary building blocks for an emissions trading system in its energy sector, including building a greenhouse gas registry system to track emission permits.South Africa is spearheading a carbon tax, which will be implemented in 2015. The design of the system includes a carbon offset scheme that helps companies meet their liabilities.Outside of the PMR, South Korea is preparing the first phase of its ETS, to start in 2015. And in California, compliance obligations came into force at the start of this year for its cap-and-trade programme which, when it expands in 2015 to fuel providers, will cover 85% of the state’s emissions.Innovation generating actionIt is progress at the country level that gives hope – the innovation, energy and farsightedness among the people developing these national and sub-national systems that convinces us at the World Bank that carbon pricing is emerging and carbon markets have a future.We hope to jumpstart a fresh debate. We don’t know if these are the right answers, and they are certainly not the only answers, but we do know that we need to work with everyone – policy-makers, the private sector and civil society – to develop our ideas, learn from others, and together decide how best we can move ahead on catalysing stronger political ambition and translating ambition into robust, predictable carbon prices.At the World Bank Group, we will continue to support innovation and offer technical analysis to countries as they explore their carbon options, and investigate mechanisms that can bring markets to a scale commensurate with the challenges we face.We cannot afford to fail in our efforts to limit climate change. Show Less -
Policy makers under pressure can get preoccupied with the fixation of the moment. For the eurozone, that idée fixe has been “the firewall”. How big is big enough? Who contributes and how?Now that the ... Show More +eurozone finance ministers have exhausted themselves with a multilayered package of hundreds of billions of euros, the debate will go global at this week’s spring meetings of the International Monetary Fund and the World Bank. The next preoccupation will be how many more hundreds of billions of euros should be pledged to the IMF. It will be Firewall II: the Sequel.I beg to differ. Not with firewalls exactly, but with the preoccupation.The survival of the eurozone now depends on Italy and Spain. They are the countries that are too big to fail – or to rescue. Extraordinary action by the European Central Bank has lowered the interest rates that Italy and Spain pay on their debt, but not solved their problems.In one sense, the much-badgered Germans are right. The fates of Italy and Spain depend on the steps their governments take to cut spending, reduce debt, strengthen banks and make structural reforms. Firewalls offer reassurance to markets, but the governments’ action, their political support and the ECB’s liquidity will be decisive.The firewall preoccupation distracts from the fundamental issue: what should the EU do to help Italy and Spain retain political support for reforms? Structural steps are painful for any government. They are devilishly difficult without growth. Reforms can disrupt an economy for a time as investment, business and workers adjust.In Italy, Mario Monti, prime minister, has begun an exemplary combination of fiscal consolidation and reforms of pensions and labour markets. But unemployment is rising. Will Italy sustain the politics of reform without supportive EU policies? Mariano Rajoy, Spain’s prime minister, has set a similar course, but even modest concessions on the path to reduce the deficit, combined with 23 per cent unemployment and challenges in elections and on the street, have prompted a rise in Spain’s borrowing cost. The economics of adjustment and the politics of reform would be easier if Italy and Spain could be boosted by European growth.Yet as one European told me, economics is a branch of moral philosophy in Germany, so do not expect expansionary demand policies to trump rectitude, discipline and belt-tightening. There is, however, a supply-side growth alternative: strengthening investment, the single market, and the EU itself.Instead of quarrelling over firewalls, Europeans should add just a fraction – say €10bn – to the capital of the European Investment Bank. Under current conditions, the EIB may actually have to reduce lending. Instead, the EIB could use more capital to borrow and then invest to support structural reforms, showing Spaniards and Italians that their sacrifices will draw productive investments. The EIB is now even led by a talented German, Werner Hoyer, from the governing coalition. President José Manuel Barroso of the European Commission should also demand disbursement of the billions of euros of structural and cohesion funds that sit on its books while poorer parts of Europe go wanting; find the logjam and break it.The single market – the very fibre of EU integration – could also come to the rescue. Although goods move freely in the EU, the service sector in many countries – including Germany – could open up more. Labour movement is also far more limited than in a true single market. Whether the cause is language, habits, matching jobs with workers, or cost of relocation, now is the moment to overcome the hurdles and advance the true unification of the EU. Show people who want to work that the EU wants them, too.The combination of fiscal and structural reforms, EIB and EC investments, the opening of service markets, and easing the movement of workers will pay dividends. Mr Monti has travelled to Beijing to show China’s sovereign investment fund that Italy is becoming a good place to invest. That makes more sense than lobbying the Chinese to add to firewalls, especially if the EU itself invests and makes the single market more attractive.Firewalls have their purpose. But this debate risks becoming a distraction. Europeans and their partners need to keep their eye on the strategic Schwerpunkt: helping Italy and Spain with growth and the politics of fiscal consolidation and structural reforms that will boost business, competition and jobs. The ECB has done its work. The other institutions of the EU need a burst of activism on investment and strengthening the single market to preserve and secure their union.The writer is World Bank president. Show Less -
In palatial rooms at the Berlaymont, Brussels, EU finance ministers have been discussing how to save the Eurozone and balance growth with austerity. Across the globe in Mexico City, G-20 ministers hav... Show More +e been trying to save the world economy by strengthening financial systems. In New York at the General Assembly, representatives have been rallying to muster resolutions to denouce violence in the Middle East. Where in the corridors and halls of power are they talking about women's rights? The answer is easy. In side meetings, rarely ever the main event.Let's for a moment imagine a different world. It's a world where women are recognized as helping drive global growth -- today we already know that women represent 40 percent of the global labor force. A world where all women and girls have the chance to live full productive lives -- today we know that too many girls and women still die in childhood and in the reproductive ages. A world where there's equal employment opportunities, equal earnings, equal rights to own land or inherit property.Today in the developing world, it is women who're more likely to be the unpaid family laborers, or farming smaller plots or if they're entrepreneurial, operating in smaller firms and less profitable sectors. It's women who in general in the developing world are earning less than men. It's women who are suffering from pervasive sexual violence, and political, economic, and social disenfranchisement.We know all this from countless studies. Our own World Bank research has shown the lower the income, the more women and girls are disadvantaged, and we know that low income countries lag behind in realizing progress in boosting female school enrolment. Countless more studies from the UN, government agencies and non government organizations all point to persistent segregation, opportunity and earnings gaps between men and women.These studies line our shelves. At women's meetings or international fora we quote them incessantly to one another. But where are the men at these meetings? And is anyone listening? Where are the global agreements? Where is the action? Where is the nexus of change?Some might argue it's happening all around us. They would say just look beyond the sea of men in blue, grey and black, and you'll see the women. In boardrooms? Well only partly. The fact is women have low representation on the boards of large firms -- about 12 percent in Europe, ten percent in the Americas, seven percent in Asia and the Pacific and three percent in the Middle East and North Africa. In Parliaments? Well again the answer is only partly. The fact is women are much less likely to belong to a political party than men. Even in 2010, women ministers were twice as likely to hold a social portfolio than an economic one.There was of course last year's Nobel Peace Prize which was awarded jointly to Ellen Johnson Sirleaf, Leymah Gbowee and Tawakkol Karman "for their non-violent struggle for the safety of women and for women's rights to full participation in peace-building work." There's been improvement in girls' access to primary education, and more countries have signed up to the Convention on the Elimination of All Forms of Discrimination Against Women, though some key countries are noticeably missing.So there is recognition -- but insufficient change. In the World Bank we believe that gender equality is smart economics. We know it to be the case -- and so do many others. We know delivering clean water, sanitation and maternal care helps drive down maternal mortality rates. We know giving women title to land -- as has happened in Ethiopia -- helps narrow the gaps between men and women. We know from countries as diverse as Bangladesh, Brazil, Cote d'Ivoire., Mexico, South Africa and the United Kingdom that increasing the share of household income controlled by women -- either through their own earnings or by cash transfers -- changes spending in ways that benefit children, communities, and societies.The list of what works is long. We also know the list of what's needed is long. We know too that progress for instance in reducing maternal mortality has not kept pace with income growth. Over the past two decades, only 90 countries had a drop of 40 percent or more in maternal mortality rates, while 23 countries showed an increase. Women who run the house in rural areas in the developing world are less likely to get credit. And on a continent like Africa, women are less likely than men to own or use a cell phone.So as we mark International Women's Day, let's consider how we can reshape attitudes and change societal "norms" among men and women about gender. It needs to be done. One of the most disturbing findings from the World Bank's field research in 19 countries in all regions around the globe, showed that for women going about their everyday lives, many of the problems of old still remain, even as new challenges have emerged.Perhaps more telling still, for many women change remains an aspiration reserved for future generations. Not for them, not for now, but hopefully for their daughters or granddaughters. We owe it to those women to take action now. A good start would be for some of those high-level global discussions -- and decisions -- on growth, prosperity, financial systems, and violence, to begin to factor in the potential role of the forgotten fifty percent of the world's population. Let's not leave it till the next generation. Show Less -
The Spring Festival travel season, or chunyun, is back and a total of 3.1 billion trips are expected during the 40-day peak season. It's understandable that for many it is hard to get a train ticket a... Show More +s China's railway system not only carries the largest and fastest growing volume of traffic of any major railway in the world, it also is by far the busiest. It carries nearly three times the volume of traffic on an average kilometer of rails as the US rail network, and about 10 times that of the European Union.Despite substantial investment since 1949, China's railway route length compared to its land area is still one-third that of the US and only one-sixth that of the EU. More strikingly, its route length per citizen is less than one-twelfth that of the US and one-seventh that of the EU. No wonder, China's rail network is used so heavily. Indeed, its capacity is effectively rationed on many routes, something that will be readily attested by many passengers waiting for seats and freight shippers unable to get all the wagons they would like.With such high utilization and growing traffic, China has no choice but to build new lines in its main inter-city corridors. The question is, whether the new lines should be built for traditional-speed or high-speed railways. Building high-speed railway normally costs more than building traditional rail infrastructure. But in China the incremental cost, usually considerable, is not prohibitive partly because most new lines are built on viaduct and through tunnels to minimize the use of land whether for traditional-speed or high-speed railways. Moreover, new lines built for traditional-speed trains only provide capacity, not better services, to meet the increasing competition from road and air transport. That's why nowhere in the world new inter-city rail lines are being built for traditional-speed trains.Internationally, high-speed trains have competed successfully with buses and planes as the mode of transport. The central and coastal regions of China have just about the most favorable demographic and geographic conditions for high-speed rail network to succeed, for it will connect 15 cities with populations of 3 million or more each and 50 cities with populations of more than 1 million.This pattern of inter-city journey is favorable for the railways. Also, rapidly growing personal disposable incomes will create demand for travel. This should augur well for the long-term economic viability of China's high-speed rail network, which just after four years can be compared to that of the French high-speed rail network in volume. With that said, many people doubt the rapid development of high-speed railway in China after the high-speed train accident in Wenzhou on July 23, 2011, which the State Administration of Work Safety in its December report blamed on technological as well as human failures. Much needs to be done and should be done to ensure that such an accident does not recur. Internationally, high-speed rail technology has an excellent safety record, and the fact that it is much safer that road transport is one of its big positives. Hence, the high-speed rail program with strengthened oversight should remain a critical component of China's land transport strategy.High-speed rail traffic will certainly continue to expand as the lines under construction are completed and networks joined. Besides, economic growth and rising incomes will ensure increasing long-term utilization.In the interim, any unused capacity can be filled through market-based pricing, allowing a wider spectrum of Chinese people to reap the benefits of high-speed railways. It will be attractive for trips that would otherwise be undertaken by road or air, and contribute to a safer and less carbon-intensive transport system.Finally, shifting passenger transport to the high-speed network will increase the capacity for rail freight on the traditional-speed rail network and relieve the pressure on the expressway system in the busiest corridors.The development of railways in China faces several challenges. First among them, as the Wenzhou accident showed, is of safety and reliability of the high-speed rail network. Second, it is important to establish a durable funding model which recognizes that infrastructure built to last and serve a century cannot start paying back during its first handful of years. To this end, the high-speed rail program should be consolidated into a "tighter" network covering priority routes with the highest returns, while making more effective use of long-term financing instruments.The author is China transport sector coordinator at World Bank Office, Beijing. Show Less -
From cave drawings to navigational charts to GPS, people have created and used maps to help them define, order and navigate their worlds. Four hundred years ago, in the Age of Exploration, it was cart... Show More +ographers, often working alone, who used the stars, mathematics and early attempts to represent longitude to map the New World. Today, in the Age of Participation, it’s crowds, not scholars, who are charting their own New World. A combination of the old art of mapping with the relatively new art of crowdsourcing — the open calls for action via the Web — offers the potential to open up a new path for the developing world: helping citizens map their own country’s facilities and thereby have a greater say in charting the future. Citizen cartographers can be a powerful force. In the aftermath of the Haiti earthquake, rescue workers used real-time data uploads on Open Street Map, via text and cellphone messages, to help create up-to-date maps of Haiti and find the injured. Engineers from around the globe gathered “virtually” to assess the damage. Last October, the World Bank and its partners staged the first ever global “water hackathon,” with volunteer tech experts in London devising a system to allow Tanzanians to report water problems through SMS messages, and tech experts in Lagos devising new applications for reporting broken pipes. Or take Dar es Salaam, where the local authorities engaged students to map roads, drains and streetlights in anticipation of an urban upgrading project, not only generating transparent planning data but also providing a platform for community consultation and a space for dialogue on development between citizens and leaders. It’s a simple but harsh reality that most developing countries don’t have basic local data about where schools or hospitals are located. A recent mapping study of 100 health facilities and schools in Kenya found that only 25 percent of the clinics and 20 percent of the schools matched official data. Nearly 75 percent of locations needed to be updated. Lack of knowledge of social infrastructure like schools and hospitals makes it more costly when natural disasters strike, setting back recovery efforts, sometimes by months. And lack of data, in general, makes it harder — both in government and in the community — to argue for improved services or increased funding. The answer? A good start would be scaling up the use of modern mapping technology with crowdsourcing. It’s just this potential that’s been the driving force behind a new partnership between the World Bank and Google. Under the agreement, the bank and its development partners — developing country governments and U.N. agencies — will be able to access Google Map Maker’s global mapping platform, allowing the collection, viewing, search and free access to data of geoinformation in over 150 countries and 60 languages. Simply put, it means that up-to-date maps of social infrastructure used by nearly a billion people around the globe can be created using crowdsourcing tools, partnering with volunteer mappers using GPS enabled phones and other devices. Success will hinge on using local expertise to break new ground — finding an active community of passionate citizen cartographers from civil society organizations, local governments, public service providers and universities who can plug in the data that makes its way to publicly available online maps. Where once charts were vital to guide mariners to safe harbors, today's interactive maps can guide development to the places it is needed most. Crowdsourced mapping platforms can serve as a foundation allowing citizens not just to map but to give feedback on the reach and quality of the services in their community. And that information can be used to improve service delivery, fight corruption and track resources. Citizen cartographers, yes, but also citizen monitors, citizen evaluators, citizen-driven development. Development agencies can also benefit. At the World Bank, we’ve mapped 2,500 projects in more than 30,000 locations in our partner countries. Building on this success, the World Bank, Britain, Sweden, Spain, the Netherlands, Estonia and Finland have endorsed an Open Aid Partnership that will map development projects of all partners for better local development coordination. Adding citizen feedback can be a valuable addition to the bank’s quest to ensure development dollars are well spent. In the 17th century, imperial cartographers had an advantage over local communities. They could see the big picture. In the 21st century, the tables have turned: Local communities can make the biggest on the ground difference. Crowdsourced citizen cartographers can help make it happen. Caroline Anstey is a managing director of the World Bank. Show Less -
Imagine if a city of almost four million people disappeared every year. A Los Angeles, Johannesburg, Yokohama. It would be hard to miss. Yet it goes largely unnoticed that almost four million gir... Show More +ls and women “go missing” each year in developing countries when compared to their female counterparts in developed countries. About two-fifths are never born; a sixth die in early childhood, and more than a third die in their reproductive years. High mortality rates are just one of many barriers to equality between men and women, as argued in the World Bank’s new report. Equality is not just the right thing to do. It’s smart economics. How can an economy achieve full potential if it ignores, sidelines or fails to invest in half its population? The world has taken significant steps over the past 25 years toward narrowing the gaps between men and women in education, health and labor markets. Today, girls and boys participate equally in primary education in most developing countries; a third have more girls in secondary school than boys. At the university level, women now outnumber men in more than 60 countries. Women are using their education to participate increasingly in the labor force, diversify their time beyond housework and childcare and shape their communities, economies and societies. Women now make up more than 40 percent of the global labor force — including a large share of the world’s entrepreneurs and farmers. This pace of change has been remarkable: For example, what took the United States 40 years to achieve in increasing girls’ school enrollment, Morocco did in a decade. Other dimensions of equality, however, portray a more disturbing picture. Girls who are poor, live in remote areas or belong to minority groups still cannot attend school as easily as boys. Women are more likely than men to work in low-paying occupations, to farm smaller plots and to manage smaller firms in less profitable sectors. Whether workers, farmers or entrepreneurs, women earn less than men: 20 percent less in Mexico and Egypt; 40 percent less in Georgia, Germany or India; 66 percent less in Ethiopia. Women —especially poor women— have less say over decisions and less control over household resources than men. Women’s voice and representation in society, business and politics is significantly lower than men’s — with little difference between poor and rich countries. Leveling the playing field for women would offer huge potential. Talk to Julian Omalla. This Ugandan business woman had trouble getting a loan in 2007. She was not alone. Ugandan women owned nearly 40 percent of registered businesses, our research showed, but got less than 10 percent of commercial credit. Since Omalla gained access to credit, thanks to Uganda’s DFCU Bank and the World Bank’s private sector arm the IFC, her food and beverage company has thrived. Today it employs hundreds of people. Much more can be done to stop women from being economically marginalized. Equalizing access to fertilizers, and other inputs for female and male farmers, for example, could increase agricultural yields in much of Africa by 11 percent to 20 percent. Removing obstacles to women that block certain sectors and occupations could raise output per worker by 3 percent to 25 percent — depending on the country. Legal reforms that would allow women to own land and businesses, or inherit property, can free them to become economic agents of change. Putting resources in the hands of women has shown to be good not just for them, but also for their children. It increases a child’s chances of survival, health and nutrition and school performance. Empowering women to use their talents and skills can boost countries’ competitiveness and support growth —a valuable, under-used resource in an uncertain global economy. During the 2008 financial crisis, women’s incomes helped keep many families afloat —hence the importance of ensuring that women’s productivity and incomes are not held down by market or institutional barriers, or overt discrimination. This challenge is not just about developing countries. Around the world, one in 10 women will be sexually or physically abused by a partner, or someone she knows, over her lifetime. The World Bank’s new report calls for action in four areas: • addressing human capital issues, like the higher mortality of girls and women, through investment in clean water and maternal care and persistent disadvantages in education through targeted programs; • closing the earning and productivity gaps between women and men — by improving access to productive resources; water and electricity, and childcare; • increasing participation by women in decisions made within households and societies; and • limiting gender inequality across generations, by investing in the health and education of adolescent boys and girls, creating opportunities to improve their lives and offering family planning information. We have seen that focused policy attention can make a difference. Sustainable solutions are best grounded in partnerships including families, the private sector, governments, development agencies and religious and civil society groups. Even in the most traditional societies and poorest villages, I have seen that when women gain opportunities to earn more for their families, it quickly overcomes men’s suspicions — or even initial hostility. But people often need a project that sparks a changed outlook. The poorest countries can accomplish much more with financial help. The World Bank will invest, in part, because the economic payoffs are large. Gender equality is the right thing to do. And it is also smart economics. Robert B. Zoellick is the president of the World Bank Group. Their new report, “World Development Report: Gender Equality and Development,” was released Monday. Show Less -