Intersections between Poverty, Environment and Inclusive Growth: A Global Perspective

Leisa Perch Coordinator – Rural and Sustainable DevelopmentInternational Policy Centre for Inclusive Growth

(IPC-IG/UNDP)

II National Development Conference (IPEA CODE)Brasilia, November 24th, 2011

Focus of Presentation

Our work on Sustainable Development focuses on environmental risk including climate change as an added distortion to and opportunity for reconciling environment, social and economic imperatives in policy and in the context of inclusive growth. Our theme is : “For Growth to be Inclusive it must be sustained and sustainable. And to be Sustainable it must be equitable”.

This presentation is based on largely on Poverty in Focus magazine #23 and speaks to four key areas/messages:• Intersections of environmental risk and poverty and social risk and the

environment are fundamental to the inclusiveness of growth • Both structural and situational in nature, they require solutions that

focus on both participation and benefit-sharing• Relevant policy innovations exist and need to be up-scaled• A focus on the quality of growth will be key in sustaining progress

Inclusive Growth - process and outcome

Inclusive growth is both an outcome and a process. On the one hand, it ensures that everyone can participate in the

growth process, both in terms of decision-making for organising the growth progression as well as in participating in

the growth itself. On the other hand, it makes sure that everyone shares equitably the benefits of growth. Inclusive

growth implies participation and benefit-sharing. Participation without benefit sharing will make growth unjust

and sharing benefits without participation will make it a welfare outcome (IPC-IG).

Essential concept: Growth as “means” not as an “end in itself”

Global Trends – Uneven Devt + Enhanced Risk

• 10 countries accounted for over 60% of Gross World Output in 2010 (CIA, 2011) – largely industrial and or service-based

• In 2008, environmental damage was USD 6.6 trillion exceeding even the impact of the economic crisis.

• The Rural Poverty Report (2011) notes that 1.4 billion people continue to live in extreme poverty, struggling to survive on less than US$ 1.25 a day.

• Women still make up a large % of agricultural labour, largely uncompensated.

• Spatial Inequalities still mean that rural women spend much more time in securing access to water

• A synergistic spiral of environmental degradation and poverty

• Urban share of GDP exceeds 80% in Asia (UNESCAP/UNHabitat, 2011) and 30% of the urban population lives in slums

http://www.trust.org/alertnet/news/worst-drought-in-60-years-hitting-horn-of-africa-un

http://www.worldbank.org/foodcrisis/

Multipliers and Rebound effects

Source: Millennium Ecosystem Assessment, WRI, 2003

Pulling Together or Apart

• Short-term needs overrun potential long- term benefits with poverty inducing environmental degradation which in turn exacerbates poverty.

• Poor individuals are both agents and victims of environmental degradation.

• The generalization ignores heterogeneity and the notion that not all poor people have the same capital endowments.

Region Average Ecological

Footprint for

consumption per

capita/per resident

Sub-Saharan

Africa

1.4 gha

Latin America

and the

Caribbean

2.6 gha

Europe 4.7 gha

North

America

7.9 gha

Global 2.7 gha per person Source: Ecological Footprint Atlas (2010)

Major Threats to Sustained Growth

• Asia-Pacific – Pollution and Climate Change• SIDS – Caribbean countries: 20% of GDP coping

with climate change• Latin America – Inequality (UNECLAC, 2010)• Africa – health and environmental related

inequalities• Europe and the CIS – Poor Infrastructure and

Dire Environmental Situation• Arab States – Legacies of Dutch Disease,

Declining energy reserves and food insecurity

Integrating Poverty and Environmental Policies is not a

Linear Process

“policy objectives at the highestlevel of policy and policy-makingis an important element and can

bring numerous benefits” (Souza and Chmielewska)

Understanding the Process of Change

Contentions and Contradictions

• The integration of poverty and environment policies has taken center- stage in the development debate for their potential to generate substantial benefits…

… However, contrary to accepted beliefs, these policies do not produce systemic win-win situations for all sectors of society.

• The idea that development will automatically benefit all is reminiscent of Adam Smith’s ‘invisible hand’ and Voltaire’s Candide, where, in the latter, “everything is for the best in the best of possible worlds”.

This innate equilibrium in all things has not materialised, and, even in the face of deliberate policy, the record is marked by

limited success and multiplying challenges.

Challenges for Development Practice

• Policy synergies• Increasing income among the poor within environmental

limits. Often, improving the well-being of the poorest implies increasing both production and consumption.

• Increasing consumption of the poor while making readjustments in readjustments in the consumption patterns of the middle and upper classes in developed and developing countries.

• Mainstreaming is not cost-free• Unavoidable diminishing returns• Decoupling growth from environmental degradation

complex

Opportunities: Urban

• Improved water and sanitation: linked to these is the interface between health, exposure to toxins, the informal waste collection sector, and recycling.

• The losses caused by poor sanitation exceed Bangladesh’s national development budget for 2007–2008 by 33 percent. “The total amount of these losses is five times higher than the national health budget, and three times higher than the national education budget in 2007 (new WSP report 2011 – World Bank and others)

• “Bangladesh lost US$ 29.6 per capita, which demonstrates the urgency of improving sanitation in the country” (Ibid, 2011)

“The traditional sectors of water and sanitation remain the most promising areas for a twin-track approach”

Gabriel Labbate, UN-REDD

In the Dhaka suburb of Demra, a man stands in putrid water to collect recyclable plastichttp://www.bbc.co.uk/news/business-15552967

Opportunities: Rural

• Sustaining food security will require intense efforts to increase productivity while shifting to low-carbon and zero-waste modes of production. Climate-smart agricultural techniques offer the potential to substantially reduce emissions and increase carbon storage in soil. A ‘triple win’ for improving agricultural productivity and food security, addressing climate change, and improving the lives and livelihoods of rural populations,

“The close link betweenthe changing climate and human security has increasingly become part of the global discourse and Africa’s climate story is largely defined by its dependence on rain-fed agriculture”.

Lindiwe Sibanda, FANRPAN

www.tpoug.org/farmers-group-case-study-teso.shtml

http://nudf.org/?page_id=51http://live.psu.edu/story/52900

Sustainable Development is Freedom

“To shape adaptation policies to best effect, it is necessary to go beyond responding to the most

immediate natural impacts of climate changeand look to the broader dimensions of resilience

such as power, livelihoods and access to justice” – (Smith and Vivekananda, Poverty in Focus #23)

Maximizing human potential

• Women have expertise in adaptation – seed management, local knowledge.

• Scale-up is needed in in order that greater economic benefits from their labor can be generated

Mairi Beautyman

https://www.microplace.com/

• Despite suffering from socio-economic disadvantages, women are already responding to climate change.

• They are actively involved in agriculture, energy, and water supplies, forest use.

• Declining energy reserves, the rise in emerging economy demand, and a gradual global shift to climate-friendly growth have created a break from the cycle

• Rising prices could constrain future human development trends

• Enhanced social safety nets and new approaches to agricultural productivity gains

Lessons from the Arab States Region

http://www.megawhatme.com/en/2010/06/menas-energy/

http://www.israelnationalnews.com/News/News.aspx/142282

In addressing energy risks and opportunities in the Arab region, two complimentary goals are taking shape in the region: 1.To reduce the energy intensity of growth and2.To expand access to sustainable forms of energy for the poor

The Right to Food?

Challenges

• Environmental degradation and climate change: higher risks to agricultural production and increased vulnerability to food insecurity

• 2050 projections: Food production will need to increase by >70%

• Rural poverty: Over 70% of the extreme poor live in rural areas.

• Smallholder farmers: weather dependecy + limited access to human, social and financial capital.

Hunger

Poverty

Inequality

Beyond Preservation and Crisis Management– Balancing Acts and

Equilibrium

“As discussed in Zaman (2008)and Sen (2010), an overrelianceon or predominance of any one

pillar (in a balanced system) will lead todisequilibrium or inefficient equilibrium” (Connor and

Williamson)

Social dimensions of green growth in ECA

• Ensuring the creation of alternative livelihoods, equitable energy tariff reform, equitable access to renewable energy are all a prerequisite to developing holistic, effective long-term green growth strategies

• Knowledge-sharing will play a central role in ensuring that green growth investments are not only profitable, but also equitable

http://howtomakesolarpanelsdiy.info/

http://ecogov2.blogspot.com/2010/11/green-growth-by-er-florano.html

Forests: Other Local-Global Dynamics

• Co-benefits for forest conservation and forest-dependant livelihoods, including biodiversity conservation, forest recuperation and sustainable harvesting of forest resources at global, national and local levels

•Indigenous people play a critical role in forest and biodiversity conservation through their livelihoods in the absence of broader policy initiatives.

•References to indigenous peoples are now increasingly common in climate change policy statements, with an apparent international consensus emerging on the importance of involving them in adaptation and mitigation activities.

http://blog.conservation.org/2010/12/indigenous-participation-is-critical-for-climate-change-success

http://www.treehugger.com/corporate-responsibility/redd-forest-protection-program-could-threaten-rights-of-350-million-people.html

Opportunities and Realities in SIDS

High GDP per capitaRelatively high HDI

government ‘employer of last resort’,

Despite high investments in education, Youthunemployment and underemploymentare particularly acute

Highly segmented labour markertGender-differentiated labour market participationHighly vulnerable and volatile employmentHousehold structure – core of female headed households

Getting the Policy Right

“Whereas technology is often toutedas the starting point for green growth,social dimensions may prove to be even more crucial” – Nicholas Perrin

UNDP’s Women Green Business Alternative

1) Creating a policy environment that enhances equal opportunities for women

2) Building capacity for women entrepreneurs

3) Increasing women’s access to climate change finance mechanisms

http://www.dfid.gov.uk/r4d/news.asp?ArticleID=50436

• Green economy initiatives are not automatically inclusive.

• This initiative equips women to engage in new economic activities that address climate change threats while building self-sufficient and resilient communities by implementing three strategic elements:

IBSA Partners policy frameworks

Brazil’s efforts: • Smallholder producers (“familly

farmers”)• Agro-ecological food production

models: Fome Zero and PNSAN• Nationwide low-interest loans:

PRONAF Eco and PRONAF Forest• Green Grants for poor farmers:

PNATER• Market access promotion: PAA and

PNAE

South Africa’s efforts: • Targetted areas: IFSS• Support to previously disadvantaged

groups: CASP• Access to loans and banking

facilities: MAFISA

http://www.mda.gov.br/portal/saf/noticias/item?item_id=5288106

India’s efforts: • Targetted Public Distribution (TPDS)

Decentralized Approaches in Cameroon

• 1994 Forestry Law introduced decentralization and established community forestry

• Members of community forests make rules in the common interest .

• Community management boards promote the need for technical training to extend their livelihoods beyond traditional agriculture

• New opportunities such as the domestication of high-priced wild leaves and fruits have increased household income, potentially reducing poverty 18-30%, especially among women.

http://www.flickr.com/photos/wwf-uk/sets/72157625119996758/detail/

The Non-economic Dimensions of Decentralization

• Decentralization has created a sphere of recognition for forest peoples and other marginalized groups

• These marginal groups now have access and management rights to the forest; the value-added benefits of this has enabled sustainable livelihoods

• As a result, financial returns have been invested in social infrastructure, and;

• Younger generations have chosen to stay in their communities rather than to migrate to urban centers

http://www.flickr.com/photos/wwf-uk/sets/72157625119996758/detail/

Getting the Politics Right

Agriculture’s position in the discourse is notwithout its value-laden context, often portrayed

as a villain in the context of emissions. In contrast,its socio-economic role— livelihoods, nutrition

and health—calls for a broader and moredevelopmental approach in which social and

environmental benefits have priority (Lindiwe Sibanda, FARNPAN)

Normative Shift in the Structure of Growth

Source: Akenji, 2010

• Understanding of the social complexities in adapting to climate change

– go beyond responding to the most immediate natural impacts of climate change and look to the broader dimensions of resilience such as power, livelihoods and access to justice.

– Decisions and institutional mechanisms need to be shaped to address linked problems with linked responses. http://climatechange.worldbank.org/

climatechange/content/note-2-engage-local-communities

Process Change: Understanding and Enhancing Adaptive Capacity

Tools: South-South Solutions

• Rio + 20 will place a major focus on institutions for sustainable development and on the green economy

• Two underlying issues are important:

• The role of emerging economies in global sustainability challenges and solutions

• The emerging risks from resource scarcity for social equity and inclusive growth

South-South cooperation harness the comparative advantages of partners in the South to bring about transformational change in the global economy and to support sustainability of their own economic and social development

South-South cooperation harness the comparative advantages of partners in the South to bring about transformational change in the global economy and to support sustainability of their own economic and social development

A Declaration of Interdependence

Growth, equity and sustainability are mutually compatible, if efforts have enough time and resources, are responsive to underlying structural causes and encourage the vigorous

participation of the poor, allowing them to define their futures.

Ours is an age of political convulsions, global economic shifts, inexorable climatic change and stubborn poverty. Informed and

catalytic strategies are needed now more than ever before.

Foreword by Olav Kjorven, Director for the Bureau for Development Policy, UNDP

Thank You!!!!!

Contact information:

Leisa Perch, IPC-IGEmail: leisa.perch@ipc-undp.org

or leisa.perch@undp.org