Mahmoud Mohieldin
Remarks at the 2018 ECOSOC Special Meeting: “Towards sustainable, resilient, and inclusive societies through participation of all”
Wednesday, May 23, 2018
UN Headquarters, New York
As prepared for delivery
Thank you, Elliot. Excellencies, colleagues, ladies, and gentlemen, I am delighted to be here with you today to discuss global trends and how best to build inclusive and resilient societies.
As the title of this session suggests, it is a changing world – a rapidly changing world.
The global trends – or megatrends which some call them -- will both aid and impede on our efforts to reach the 2030 Agenda -- and they must be part of our calculus as we plan the work ahead. I just want to touch briefly on a few of these megatrends.
First there are demographic transitions and urbanization megatrends. Today, over four billion people around the world – more than half of the global population – live in cities. By 2050, with the urban population doubling its current size, nearly 70 percent of people in the world will live in cities. Among these, one billion people live in urban slums -- yet the vast majority extreme poor will continue to live in rural areas.
Another megatrend is the evolving nature of fragility and violence. Now 1.5 billion people live in countries affected by repeated cycles of violence. By 2030, half of the world’s extreme poor will live in these areas.
In the past decade, the number of people affected by natural disasters tripled to 2 billion – in some cases strongly correlated with climate and resource megatrends. Since 1980, low-income countries have accounted for only 9 percent of the disaster events, but 48 percent of fatalities.
The burden of disasters, conflict, crime, and violence falls disproportionately on the poor.
Add to these megatrends additional ones related to commodity cycles, technological disruptions, shifts in the global economy, and renewed political debate about globalization, and we have some very daunting challenges before us, but also some significant opportunities.
These mega-trends will affect our ability to achieve of the 2030 Agenda, its Sustainable Development Goals, and the Bank Group’s twin goals of ending extreme poverty and boosting shared prosperity.
With this in mind, I have three key messages for you:
First, if we are serious about sustainable development and reducing poverty we need to invest in resilience at the local level. That means factoring climate and disaster risks into all urban development. In particular, we have to manage the current resilience challenges cities and rural communities are facing, while addressing future scenarios that include threats like climate change.
Of course, cities will need financing to invest in resilient urban development. These costs will be substantial just to keep pace with expected economic growth -- and to build resilience will cost even more.
Only a very small fraction of this can be supplied by ODA. In this context, the World Bank Group’s strategy has three basic prongs -- all guided by the premise that the key goal.is to assist cities to expand access to finance from multiple sources, including private and commercial finance.
Cities need to strengthen the basic building blocks of their financing systems. This includes generating more own-source revenues, increasing fiscal transfers, improving the accounting and financial management performance of city governments, and establishing regulatory frameworks for private investment in urban and rural entities and projects.
The World Bank provides funding and helps local authorities and national governments put in place the financial framework to enable them to attract investment to grow in a sustainable manner.
In addition, we need innovative ways of leveraging investment from private and non-traditional sources, sometimes in combination with MDBs and other agencies. Through the capital-raising strategy of the World Bank’s Cities Resilience Programme, the Bank Group is pushing the boundaries in this area. The Bank Group’s City Creditworthiness Initiative aims to strengthen the financial performance of local governments, and to prepare them to tap domestic and regional capital markets without a sovereign guarantee. The City Creditworthiness Initiative has trained over 600 municipal officials from 240 cities in 25 countries.
In other words, the Bank Group has become more of a broker – working to connect investors with cities and governments. And we are engaging in a major effort to redefine our approach to development finance – something we are calling “Maximizing Finance for Development.”
My second message is that we need to better leverage technology and innovation to build sustainable and resilient societies.
The digital technology revolution provides an opportunity to tackle many of the infrastructure and sustainability challenges brought on by rapid urbanization, increases in greenhouse emissions, and rising inequalities, among other mega-trends.
Some recent technological changes have brought transformational benefits to the poor.
For example, in Kenya, after the introduction of the M-Pesa digital payment system, the cost of sending remittances from workers in urban areas to their families in the countryside dropped by up to 90 percent.
In India, the Aadhar digital identification system has already reached more than 1 billion people, enabling many of the poor to access services more easily, and saving the government billions each year by reducing corruption and waste.
According to one estimate, cities will invest nearly $1.5 trillion dollars in smart city technologies by 2020, specifically in enhancing digital services in transportation, safety and security, emergency preparedness, and civic participation. While Smart Cities are booming worldwide, they also risk leaving large numbers of citizens behind.
We are supporting countries around the world in their efforts to build resilience to the growing economic, environmental, and social challenges we face today. We are engaging early and doing more to help countries manage fragility risks, through technical advice, operations, and innovative financing -- leveraging the private sector. We are building technology-enabled solutions to these challenges. Again, for example:
In Dhaka City, Bangladesh, the World Bank developed a ‘Smart City’ Action Plan and ‘Smart City’ Investments by bringing in world-leading expertise in ICT-based smart city development. This enables cities to adopt integrated, cross-sectoral, and spatially coordinated approaches to planning and management of city land and property assets, infrastructure, services, and citizen engagement.
In Bolivia, the World Bank has supported the use of technology for citizens’ participation through the creation of a digital platform (called Barrio Digital) to identify the needs for infrastructure improvements and interventions in La Paz, Bolivia. This allows the municipality to have real-time information on the needs of each neighborhood in the city and realign the use of resources according to citizens’ requests.
And cities and communities in Burkina Faso now benefit from real-time urban flood risk data via cellphone network analysis that measures rainfall and provides early warning systems for floods.
My third message is that we need to “put people first” in the development process and strengthen links to social inclusion and investing in human capital.
Poverty is more than having low incomes – it is also about vulnerability, exclusion, unaccountable institutions, powerlessness, and exposure to violence. With rising inequalities around the world, it’s imperative we promote social inclusion of the poor and vulnerable by empowering people, building cohesive societies, and making institutions accessible and accountable to citizens.
We are doing this by undertaking timely social risk analysis, mainstreaming fragility and conflict sensitivity into analysis and operations, and adopting a violence prevention lens wherever high rates of interpersonal violence jeopardize development. We are also strengthening the resilience of communities and institutions to natural and human-induced shocks and climate trends, mainstreaming gender issues, ensuring operations are gender-informed, and expanding the exclusion-based evidence on sexual orientation and gender identity (SOGI).
For example, just last week on the International Day of Against Homophobia, Transphobia, and Biphobia, World Bank Group President Jim Kim noted that such exclusions based on characteristics such as gender, sexual orientation, disability, race, ethnicity, and religion are not only unjust. He said they also increase poverty and impede economic growth.
He said, “No country, community, or economy can achieve its full potential or meet the challenges of the 21st century without the full and equal participation of all its people.”
In this spirit, the World Bank Group launched its global Human Capital Project -- an accelerated effort to assess the progress countries have made in building human capital and to help countries invest more – and more effectively – in their people.
Human capital is the largest component of global wealth, and rich countries have vastly more human capital wealth than low- and middle-income countries. This finding strengthens the already powerful case for investing in people. Without human capital, countries cannot sustain economic growth, prepare workforces for the more highly-skilled jobs of the future, or compete effectively in the global economy.
With rapid global changes in demography, fragility, and technology, there is even greater pressures and urgency to invest in human capital. By “putting people first” with greater investment, we can prevent setbacks to global growth, equality, resilience, and stability.
I have noted just three implications and strategies to deal with these global mega-trends. And as I mentioned at the beginning of my remarks, these evolving mega-trends represent a moving target. We have to continually adapt our strategy to fit the existing conditions.
To accomplish this, we must pool our collective knowledge, data, financing, and implementation experience to reach the ambitious SDGs.
Yet, I’m confident that the people in this room -- and their colleagues -- have ideas and proven strategies that can be used to help us achieve the 2030 Agenda -- so we may create a world that is more prosperous, secure, and just.
