The United Nations MDG Strategy

1
Environmentally sustainable investment to
achieve the MDGs in the Pacific UNDP June
2007
2
Environmentally sustainable investment in the
Pacific presentation overview

• Why environmentally sustainable investment
  matters
• Why environmentally sustainable investment has
  been limited
• Defining an environmentally sustainable public
  investment and financing strategy
• Value added and challenges to environment of MDG
  based needs assessment and costing
• Environment in needs assessment and costing
  models
• Experience so farMongolia,Bhutan,Sri Lanka
• Lessons learned and challenges for future

3
Environmentally sustainable investment MDGs

• MDG 1 Poverty
• Livelihoods resource dependence of poor ie.
  Fisheries, subsistence agriculture, tourism
• vulnerability to climate shocks and long term
  changes (Kiribati high rainfall volatility,
  Marshall Islands, Kiribati and sea level rise)
• MDGs for health, education and gender
• Illness from dirty indoor air
• Lack of clean water and sanitation and
• declining availability of water and biomass

4
Environmentally sustainable investments and
pro-poor growth in the Pacific

• Natural resources contribute to growth?
• Fishery provides 7 of GDP to Pacific
• Fishing fees generate 40 of revenue in Kiribati
  and 25 of fees in Micronesia
• Tourism dependent on natural beauty provides many
  jobs eg Palau, Marshall Islands
• But growth must be pro-poor, sustainable not
  boom and bust
• Impacts of climate change on growth
• Climate change huge impacts on GDP?
• Over 1990s, natural disasters cost Pacific over
  2.8 billion (in 2004)

5
Environmentally sustainable investments
Governance, politics, capacity

• Natural resources (eg access to tuna or water
  resources) key to rights, conflicts, corruption,
  local service delivery but
• Resources fixed in short term (so resource
  decline struggles over rights and access)
• Conflict and corruption as resources located in
  remote rural areas small and large scale both
  use fixed resource, lack of visibility (eg fish)
• Investment constrained by unclear property rights
  as resources mobile and hard to enforce
• Over dependence on state capacity large role for
  govt as de jure owner

6
Lack of environmentally sustainable investment

• Environment poor are increasing ie poverty
  linked to environmental factors drylands,
  coastal, disaster prone, urban slum settlements
• But lack of private investment
• Market failure reduce incentives to invest in
  natural capital
• weak property rights
• open access
• no market price
• High discount rate lack of concern for future
• Governance and policy failure create
• perverse incentives to invest in environment
• Subsidies

7
Challenges of implementing environmentally
sustainable investment

• Environment link to poverty/growth not well
  recognised
• Confusing MDG 7 not easily measurable
• Other sectors lead (cross cutting like gender eg
  agriculture, energy)
• Weak environment institutions (lacking economic
  skills)
• No uniform investment packages (country specific)
• Not just service delivery, but access to
  declining natural resource base so politics
  matters
• Trade-offs between natural capital
• and other capital

8
Identifying investment needsEnvironment needs
assessment

• What public investments are required to achieve
  environment outcomes for MDG 7 and the other
  MDGs?
• Requires environmentally sustainable investments
  across all sectors
• Requires investments in the environment

9
An environmentally sustainable public investment
and financing strategy
1. Define interventions and parameters
2. Specify targets
3. Identify costs of interventions
5. Estimate resource requirements
6. Estimate financing sources
10
MDG 7
11
Environmentally sustainable Public investment
value added of MDG need assessment/ costing

• Integrates environment into mainstream planning
  process
• Improves prioritisation in environmental planning
• Focus on pro-poor environmental investments
• Corrects balance between policy investment
• Even policies have a cost eg land titling
• Identifies where financial resources are key
• Costed environmental interventions assist link to
  budget
• Reduces over-dependence on donor funding
• Can improve donor harmonisation on environment

12
Environment in other Needs assessment and costing
models

• Water supply and sanitation model
• (Drainage and Water resource management)
• Energy model for reduced indoor air pollution and
  off- grid energy and grid distribution
• (Energy generation carbon emissions being
  added)
• Agriculture model for some investments
• (Water issues and some land management covered)

13
Remaining investmentEnvironment Needs
Assessment Model

• Environment needs from a pro-poor perspective
• Five key intervention areas
• Health (except indoor air, water, sanitation
  already covered)
• Livelihoods improved (including ecosystems)
• Vulnerability enhanced for environment
  disasters and climate change
• Governance, institutions, capacity and systemic
  issues (not already covered)
• Additional intervention areas

14
Improving environmental health interventions

• Water supply and sanitation, indoor air pollution
  already covered in other models
• Water pollution
• Localised outdoor air pollution
• Sound management and use of chemicals
• Solid waste management

15
Livelihoods improved interventions

• Some interventions already covered in agric and
  water model
• Land, minerals and water
• Seeds and livestock (including agrobiodiversity)
• Fisheries and marine based resources
• Forests and biological diversity
• Improvements in the lives of urban slum dwellers

16
Vulnerability reduced including climate adaptation

• Assess impacts of climate change and develop
  adaptation strategy
• Design of infrastructure and investment to
  respond to climate impacts
• Income support for environmentally and disaster
  vulnerable households
• Disaster preparedness achieved

17
Governance, advocacy and systemic issues

• Awareness, advocacy and education on
  environmental issues
• Ensuring equitable access to wealth from natural
  resources
• Strengthening governments ability to manage
  environment for poverty reduction
• Empower civil society and grassroots
  organisations
• Engage private sector in pro-poor environmental
  investments
• Data collection and monitoring

18
Additional Intervention areas

• Allows country to add any additional areas

19
Experience with environment needs assessment
Mongolia, Bhutan, Sri Lanka

• Mongolia
• Energy investments 16 of total costs
• Water and sanitation 5
• Environment (pollution control) 3.5
• But environment in other sectors is limited
• Bhutan
• Energy 9 of total costs
• Water and sanitation 6.2
• Environment policy, disaster management 0.4
• Some other sectors cover environment
• Sri Lanka
• Good links with other sectors
• But too comprehensive all environment included

20
Environment needs assessment for MDGsLessons
and challenges for future

• Grounds for optimism
• Energy, sanitation, environment, disaster
  management included with country led
  identification
• Capacity and software, as well as hardware
  identified
• Environment is being picked up in some other
  sectors
• Challenges
• Environment in other sectors is key, so sum of
  environment investment is deceptive (Bhutan
  more sustainable than Mongolia?)
• Some interventions controversial eg.Mongolia
  greenwall
• All environment included no MDG focus?
• Financing strategy still lacking