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21. How Much Does Natural Resource Extraction Really Diminish National Wealth? The Implications of Discovery

Author:
Alan Gelb, Kai Kaiser, and Lorena Viñuela
Publication Date:
03-2012
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
The paper considers the process of discovery for subsoil resources, including both hard minerals and hydrocarbons and estimates its magnitude in recent years, as derived from the sum of extraction and changes in proven reserves. Spurred on by technology change and strong market conditions, discovery has been substantial for most minerals. The value of discovered reserves is high relative to the costs of exploration, particularly when low social discount rates are used to value potential production in the future. Discovery is therefore valuable and should be considered as adding to national wealth through increases in proven reserves. Many countries can continue to generate resource rents far longer than indicated by current reserve estimates and this has implications for decisions on how to plan to spend or save rents. With the high response of discovery to prices and technology, environmental constraints (climate change, water) are more likely than the actual exhaustion of resource deposits to limit resource-based development. The divergence between private and social valuation of discoveries may also justify measures taken by countries to encourage exploration, including through the provision of geo-scientific data to increase interest in discovery as well as competition among mining companies. More information is needed on the payoff to such investments, some of which are supported by donors. However, exploration is, of course, only a slice of the resource value chain. Many countries will need to improve management along the entire chain if resource wealth is to benefit their development.
Topic:
Climate Change, Development, Environment, Natural Resources, and Water

22. FCPR–Forest Conservation Performance Rating for the Pan-Tropics

Author:
David Wheeler, Robin Kraft, and Dan Hammer
Publication Date:
05-2012
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
This note introduces and illustrates fCPR (Forest Conservation Performance Rating), a system of color-coded ratings for tropical forest conservation performance that can be implemented for local areas, countries, regions, and the entire pan-tropics. The ratings reward tropical forest conservation in three dimensions: (1) exceeding expectations, given an area's forest clearing history and development status; (2) meeting or exceeding global REDD+ goals; and (3) achieving an immediate reduction in forest clearing. Green ratings are assigned to areas that meet condition (2); yellow to areas that meet (1) only; and red to countries that fail to meet either condition. We have developed fCPR at the Center for Global Development (CGD), using monthly forest clearing indicators from CGD's FORMA (Forest Monitoring for Action). This first release rates the quarterly conservation performance of 27 countries currently tracked by FORMA, as well as 242 of their states and provinces that contain tropical forests. The 27 countries accounted for 94 percent of tropical forest clearing during the period 2000–2005. Future releases will include additional countries as FORMA begins tracking them.
Topic:
Climate Change, Democratization, Development, Economics, Environment, and Natural Resources

23. Energizing Rio+20: How the United States Can Promote Sustainable Energy for All at the 2012 Earth Summit

Author:
Nigel Purvis and Abigail Jones
Publication Date:
04-2012
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Worldwide, about 1.3 billion people lack access to electricity (one in five people), while unreliable electricity networks serve another 1 billion people. Roughly 2.7 billion—about 40 percent of the global population—lack access to clean cooking fuels. Instead, dirty, sometimes scarce and expensive fuels such as kerosene, candles, wood, animal waste, and crop residues power the lives of the energy poor, who pay disproportionately high costs and receive very poor quality in return. More than 95 percent of the energy poor are either in sub-Saharan Africa or developing Asia, while 84 percent are in rural areas—the same regions that are the most vulnerable to the adverse effects of climate change.
Topic:
Climate Change, Development, Economics, Energy Policy, Environment, and Poverty
Political Geography:
Africa, United States, and Asia

24. Assessing the Quality of Aid for Agriculture

Author:
Kimberly Elliott and Edward Collins
Publication Date:
08-2012
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
New international initiatives signal strong commitment to agriculture and food security in the face of growing demand and climate-change challenges. But aid to agriculture still represents just five percent of total official development assistance. With donor budgets under intense pressure, making aid effective is more important than ever, but we still know relatively little about the quality of aid in general and of agricultural aid in particular.
Topic:
Security, Agriculture, Climate Change, Development, Foreign Aid, and Food

25. The Future of Development Finance

Author:
Nemat Shafik
Publication Date:
05-2011
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Development finance is at a turning point. There is talk about a "triple revolution of goals, actors and tools." As much of Asia grows its way out of poverty, aid will increasingly be focused on Africa and on countries plagued by instability, or with governments unable to meet the basic needs of their populations. A growing share of development finance will be directed to tackling global public goods-like climate change, conflict prevention, and public health. Responsibility for addressing global challenges will increasingly be borne by coalitions that cut across states, the private sector, and civil society. These networks to address poverty and global issues will become a feature of the international architecture in a multipolar world. The rules of the game and the tools of development assistance need to evolve to focus on transparency, results, accountability, a market-driven division of labor and flexible partnerships for the future development finance system to become an effective tool of global problem solving.
Topic:
Conflict Prevention, Climate Change, Development, Environment, and Health

26. Find Me the Money: Financing Climate and Other Global Public Goods

Author:
Nancy Birdsall and Benjamin Leo
Publication Date:
04-2011
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
The global community faces a number of critical challenges ranging from climate change to crossborder health risks to natural-resource scarcities. Many of these so-called global commons problems carry grave risks to economic growth in the developing world and to the livelihoods and welfare of their people. Climate change is the classic example. Despite the risks involved, donor governments have funded programs addressing global challenges such as climate change at far lower levels than traditional programs of country-based development assistance. The prospects for dealing with such global challenges will depend at least in part on new collective financing mechanisms.
Topic:
Climate Change, Development, Health, Humanitarian Aid, and Foreign Aid

27. Fair Shares: Crediting Poor Countries for Carbon Mitigation

Author:
David Wheeler
Publication Date:
07-2011
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
This paper computes national carbon mitigation costs using two simple principles: (1) Incremental costs for low-carbon energy investments are calculated using the cost of coal-fired power as the benchmark. (2) All low-carbon energy sources are counted, because reducing carbon emissions cannot be separated from other concerns: reducing local air pollution from fossil-fuel combustion; diversifying energy sources to reduce political and economic risks; and building competitive advantage in emerging clean-energy markets. The paper estimates energy growth and incremental costs for biomass, solar, wind, geothermal, hydro, and nuclear in 174 countries from 1990 to 2008. Then it compares national mitigation burdens using per-capita mitigation expenditures as shares of per-capita incomes. The results undermine the conventional view of North-South conflict that has dominated global climate negotiations, because they show that developing countries, whether by intention or not, have been critical participants in carbon mitigation all along. Furthermore, they suggest that developing countries have borne their fair share of global mitigation expenditures. But they also show that expenditures for both developed and developing countries have been so modest that low-carbon energy growth could accelerate greatly without undue strain.
Topic:
Climate Change, Development, Economics, and Energy Policy

28. Quantifying Vulnerability to Climate Change: Implications for Adaptation Assistance

Author:
David Wheeler
Publication Date:
01-2011
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
This paper attempts a comprehensive accounting of climate change vulnerability for 233 states, ranging in size from China to Tokelau. Using the most recent evidence, it develops risk indicators for three critical problems: increasing weather-related disasters, sea-level rise, and loss of agricultural productivity. The paper embeds these indicators in a methodology for cost-effective allocation of adaptation assistance. The methodology can be applied easily and consistently to all 233 states and all three problems, or to any subset that may be of interest to particular donors. Institutional perspectives and priorities differ; the paper develops resource allocation formulas for three cases: (1) potential climate impacts alone, as measured by the three indicators; (2) case 1 adjusted for differential country vulnerability, which is affected by economic development and governance; and (3) case 2 adjusted for donor concerns related to project economics: intercountry differences in project unit costs and probabilities of project success. The paper is accompanied by an Excel database with complete data for all 233 countries. It provides two illustrative applications of the database and methodology: assistance for adaptation to sea level rise by the 20 island states that are both small and poor and general assistance to all low-income countries for adaptation to extreme weather changes, sea-level rise, and agricultural productivity loss.
Topic:
Climate Change, Development, Poverty, and Foreign Aid
Political Geography:
China

29. A Green Venture Fund to Finance Clean Technology for Developing Countries

Author:
David Wheeler and Darius Nassiry
Publication Date:
03-2011
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Climate negotiators in Cancún reached agreement that long-term climate finance will include a commitment by developed countries to mobilize US$ 100 billion per year to help developing countries combat climate change. However, that level of investment will require substantial capital from private investors, particularly for innovation and commercialization. We propose a public-private green venture fund (GVF) to promote development and deployment of low-carbon technologies for developing countries. The GVF will use a fund of funds model backed by public "cornerstone" equity. In this paper, we propose a structure for the GVF and explain the design rationale, operating principles and key parameters for two funds of funds for technology innovation and deployment. We also highlight some key issues to be considered, including differential treatment of public and private investors and possible approaches to setting technology priorities.
Topic:
Climate Change, Development, and Environment

30. The Economics of Adaptation to Extreme Weather Events in Developing Countries

Author:
David Wheeler, Susmita Dasgupta, Benoit Laplante, and Brian Blankespoor
Publication Date:
01-2010
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Without international assistance, developing countries will adapt to climate change as best they can. Part of the cost will be absorbed by households and part by the public sector. Adaptation costs will themselves be affected by socioeconomic development, which will also be affected by climate change. Without a better understanding of these interactions, it will be difficult for climate negotiators and donor institutions to determine the appropriate levels and modes of adaptation assistance. This paper contributes by assessing the economics of adaptation to extreme weather events. We address several questions that are relevant for the international discussion: How will climate change alter the incidence of these events, and how will their impact be distributed geographically? How will future socioeconomic development, notably an increased focus on education and empowerment for women and girls, affect the vulnerability of affected communities? And, of primary interest to negotiators and donors, how much would it cost to neutralize the threat of additional losses in this context?
Topic:
Climate Change, Development, Third World, and Foreign Aid