22 October 2019 Addis Ababa, Ethiopia

1. Inclusive societies based on new economic models and sustainable use of natural resources: Perspectives from the regions • Dialogue of the Executive Secretaries of the Regional Commissions • with the UN General Assembly Second Committee • Vera Songwe • Under-Secretary-General and Executive Secretary • Economic Commission for Africa 22 October 2019 Addis Ababa, Ethiopia

2. Economic History – The Coal Question 1965 • "Coal in truth stands not beside but entirely above all other commodities. It is the material energy of the country — the universal aid — the factor in everything we do. With coal almost any feat is possible or easy; without it we are thrown back into the laborious poverty of early times. a material of such myriad qualities — of such miraculous powers."

3. The Economics of Welfare – Pigou Tax 1920

4. Inclusive Societies and Natural Resources • Thirteen of the 17 SDGs are directly concerned with the natural environment, climate or sustainability.

5. Natural resource management and the threats of climate change • Natural resources have played a key role in Africa’s socioeconomic development trajectory and continue to be very important in some of the defining priorities driving Africa’s development aspirations: • Real GDP growth is noticeably affected by natural resource commodity prices. Data covering 47 African countries projected that a 1% increase in commodity prices would boost real GDP, in the short run, by 0.26-0.36 percentage points (AfDB, 2018) • Africa’s dependence on mineral exports invariably rose over the past decades, with mining accounting for 5-30% of GDP (UNECA, 2016). • The wealth that can be generated from the ocean is conservatively valued at US$ 24 trillion, of which it is estimated that goods and services provide $2.5 trillion annually

6. Austerity Sustainability and Growth A New Paradigm • Austerity-- Macro Balances & Fiscal Discipline • Sustainability-- Technology Structural Policies • Inclusive Growth --Poverty and Inequality

7. A New Economic Vision • Changing global trends are creating new opportunities for inclusive economic transformation and climate action in countries around the world, including in Africa. • Bold actions can: • Deliver US$26 trillion in economic benefits between now and 2030. • Generate over 65 million new low-carbon jobs in 2030, equivalent to the entire workforces of the UK and Egypt today combined. • Avoid over 700,000 premature deaths from air pollution compared with business-as-usual in 2030. • Generate an estimated US$2.8 trillion in government revenues per year in 2030 through subsidy reform and carbon pricing alone – equivalent to the total GDP of India today.

8. The State of the Continent • Growth at 3.2% in 2019 & 3.6 % in 2020, < • Higher, albeit volatile, oil prices - Algeria, Nigeria, Angola • South Africa, • Diversification and trade driving growth - About 20 economies in the region, accounting for about 35 percent and about 20 percent of the region’s GDP are estimated to be growing faster than 5 percent • Conflict and Security – Libya and the Sahel

9. Climate change challenges – cyclone Idai – 1000 lives lost and costs US$700 to US$1billion

10. A climate and resource economy vision • Africa’s new climate and resource economy approach gives African leaders the opportunity to drive national development goals in ways that leap-frog old pathways to set in motion an African-owned growth model that is sustainable, inclusive and resilient. • 50 African countries have ratified the Paris Agreement with nationally determined contributions to climate action requiring finance of close to USD 3 trillion. • Limited and competing demands for public resources means that much of the investment to finance a new growth agenda in Africa will need to come from the private sector. • However, countries need to enhance productivity, diversify economic structures and boost investments in order to achieve the SDGs.

11. What is ECA doing – innovative approach to achieving the SDGs ECA’s five strategic directions is centered on promoting inclusive and sustainable development in support of accelerating the economic diversification and structural transformation of Africa, in line with the 2030 Agenda for Sustainable Development and Agenda 2063: The Africa We Want.

12. ECA Implementation: A New Inclusive Program

13. Achieving the SDGs – means of implementation

14. What is ECA doing – Strengthening Macroeconomic Monitoring and Policy Analysis

15. What is ECA doing – integrated modelling approach • ECA has been actively supporting countries in rethinking their economic and mineral resources development models. Enhancing models that focused solely on fiscal issues, ECA has led knowledge generation and applied policy research, towards optimizing fiscal, backward, forward and knowledge linkages with other economic sectors. • To achieve the SDGs, Africa’s 2019 expected growth rate of 3.4%, needs to triple. Similarly, GDP per capita growth of 0.6% in 2018 is relatively low, in terms of addressing poverty and inequality. • It is estimated that by 2030, Africa will represent approximately 87% of the global poor (Brookings, 2019) • All this calls for the need to develop integrated macroeconomic models that encompasses the region’s challenges

16. What is ECA doing – implementing new, innovative and integrated economic models Integrated macroeconomic strategies ECA is with countries in an approach that fosters integrated implementation of the SDGs and Agenda 2063 within National Development Plans.

17. Opportunities for achieving the SDGs • Macroeconomic opportunities – ECA research shows that governments can boost revenues by 12-20% of GDP through better and more efficient tax administration systems • Potential of the AfCFTA- Modelling by ECA forecasts the AfCFTA to increase both Africa’s GDP and exports by $44 billion and $56 billion, respectfully, with intra-African trade in industrial goods increasing by 25 to 30% • Infrastructure driven growth • Infrastructure responsible for more than half of Africa’s recent growth performance • Good infrastructure improves competitiveness, facilitates domestic and international trade and enhances regional integration • Africa invests only 15-25% of GDP on transport infrastructure compared with more than 40% in China

18. What is ECA doing – country support to national AfCFTA plans

19. What is ECA doing – Digital Centre for Excellence

20. What is ECA doing – SDG7 Initiative for Africa • combines scale, speed, sustainability and access to crowd-in financing from the private sector for accelerated clean energy deployment to address Africa’s increasing need for energy, while contributing to climate action through enhanced nationally determined contributions to climate action (NDCs) under the Paris Agreement Share of renewables in electricity installed capacity in Africa (2017)

21. What is ECA doing – Disaster Risk Insurance Markets in Africa • ECA, the African Risk Capacity (ARC), the International Finance Corporation (IFC), and the African Institute for Economic Development and Planning (IDEP) worked together to develop a Risk Modeling Capacity Building Program for the Insurance Sector in Africa. The capacity building program aims to raise awareness of the importance of insurance risk modeling, its tools and approaches, as well as strengthen capacity in standardizing practices for risk modeling in the agriculture insurance sector.

22. What is ECA doing - Seychelles Blue Economy Bond The country has launched the world’s first “Blue Economy Bond”. The bond is an innovative financial instrument used to finance ocean and marine-based projects that have positive economic, environmental and climate benefits (World Bank, 2018) At the start, only 0.04% of the country’s waters—off the east coast of Africa—was under protection. Thanks to a deal that restructured $22 million of the country’s debt, that had jumped to 26% by February 2019. The bond will support expansion of marine protected areas up to 30 per cent of the country’s exclusive economic zone (EEZ) as well as improve governance of priority fisheries and development of the blue economy in the Seychelles.

23. What is ECA doing - Climate-Land-Energy-Water Systems (CLEWs) • ECA’s CLEWs Project, carried out in collaboration with UNDESA and UNDP, focuses on policy coherence and technical modelling integrated climate, land, energy and water systems approach to implement the SDGs in Cameroon, Ethiopia and Senegal. • The CLEWs programme is thus contributing to support to the pilot countries towards integrated implementation of SDG13, SDG15, SDG7 and SDG6. • Given that African countries are primarily dependent on natural resources, including water, land, agriculture and energy, ECA will work with some of the pilot countries towards integration of the CLEWs modelling into the macroeconomic models of those countries.

24. ECA activity – Monitoring and Evaluation Agenda 2030 and 2063. • Facilitates alignment/integration of the 2030 Agenda and Agenda 2063 at goal, target and indicator levels • Simultaneous alignment with National Development Plans • Assess degree of alignment by sector and dimension of sustainable development • Identify reasons for non-integration; a basis for support • Reports progress, contributes to voluntary national reviews and HLPF • Visualization of important aspects of the alignment process

25. THANK YOU!