In June and July 2020, the LEDS Energy Working Group hosted a three-part online discussion series on assisting developing countries in their efforts to recover from the global Corona pandemic, and the resulting economic crisis. The key objective was to understand how short-term recovery efforts, particularly in the energy and transport sectors, can support long-term transitions towards climate objectives and the Sustainable Development Goals (SDGs). This blog summarizes the discussions of the third session which focused on the importance of international cooperation in supporting SDG-oriented recovery in developing countries.

Part 3: Technical and financial needs of developing countries

Key messages:

• Countries should draw on their current NDCs to ensure a low-carbon and resilient recovery.
• We must strive for the ‘‘double dividend’’: stimulating the economy while accelerating the transition to net-zero greenhouse gas emissions
• Technical assistance and international exchange of know-how on recovery strategies are essential for a sustainable recovery in developing countries.

Alexander Ochs started the session by emphasizing that developing countries are in need for significant financial and technical support to embark on a sustainable and resilient post-pandemic recovery. International cooperation and climate policy instruments are to play an important role since many governments face depleted fiscal capabilities, limited capital inflows, and inadequate infrastructure. Panelists are asked to focus on a few key questions: What risks and opportunities exist in the wake of the pandemic? How can international cooperation on climate change assist emerging economies? Are the existing policy instruments sufficient for an ambitious recovery? [JSRG1] 

According to Martin Schuldes from the German Federal Ministry of Economic Cooperation, the world is facing a ‘‘triple crisis:” 1) the pandemic, 2) a climate emergency, and 3) an economic recession of unprecedented proportions. The decisions to be taken in the following months, both on a domestic and international level, will determine the economic landscape of the decades to come. Schuldes says there is an ‘‘unparalleled opportunity to build back better’’. The alignment of SDG-proof policies with stimulus packages could deliver a ‘‘double dividend’’ to emerging economies – that is, reinvigorating the economy while fighting climate change in accordance with the Paris Agreement targets. However, a serious risk exists: the political willingness to compromise climate targets and SDGs in favor of unsustainable ‘‘brown’’ growth, which in turn will lead to impassable carbon lock-in effects and exacerbate current path dependencies.

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“The decisions to be taken over the next months will shape the global economic landscape of the 2020s. It’s an unparalleled opportunity to build back better.”

Martin Schuldes, German Federal Ministry of Economic Cooperation

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Schuldes believes that existing climate policy instruments are sufficient. Pablo Vieira, the director of the NDC Partnership’s Support Unit, agrees. He insists developing countries must implement their current NDCs to ensure a low-carbon, resilient recovery. Stimulus packages should be aligned with both mitigation and adaptation strategies. This would spur growth and create immediate employment. However, as the economic fallout of the pandemic becomes more visable, Vieira fears that governments will draw back from their NDCs in terms of ambition, reach, and timelines. This is where the influence of International cooperation carries significant weight; technical assistance to governments and cross-border exchange of know-how on green recovery strategies will give emerging economies the help they need to design sustainable stimuli.

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“Countries need to use their current NDCs to ensure a low-carbon and resilient recovery.”

Pablo Vieira, NDC Partnership

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Chile demonstrates how countries can increase their ambition, even during a global pandemic. The country committed to achieving climate neutrality by 2050, a target included in the country’s updated NDC. According to Gabriel Prudencio from the Chilean Ministry of Energy, Chile’s recovery package, totaling $12bn, will allocate a considerable chunk of the available funds to sustainable investments, such as renewables, e-mobility, building retrofits, clean hydrogen, and the phase-out of coal.

International organizations are pivotal nodes for the transfer of knowledge and resources to developing countries. As such, they were quick to step in and bolster developing countries’ efforts in response to the COVID-19 crisis. Alexandra Soezer, technical climate advisor at the UNDP, shares insights from the UNDP’s integrated energy response to Covid-19 in the developing world. Citing the example of UNDP’s work in Uganda, Soezer says the organization helps countries to cope with the public health crisis by supporting the electrification of health facilities, particularly in isolated and rural areas. UNDP also aims at safeguarding the continuity of energy services and energy access of vulnerable populations through multisectoral efforts (both utility-scale and off-grid). The UNDP will continue to support developing countries in their recovery phase, through rigorous technical assistance and policy guidance, providing a role model of how international cooperation must function during (and after) the pandemic.

Learn more about the three-part online discussion series here.

Learn more about this session by checking out the recording on YouTube:

By: Apostolis Valassas, SD Strategies, for the LEDS GP Energy Working Group. Launched in 2011, the EWG is the LEDS GP’s longest standing work stream. By providing opportunities for learning, information exchange, and greater cooperation, the EWG assists countries around the world in designing and implementing successful climate-compatible energy-sector development strategies.

Disclaimer: The information and opinion expressed on this blog post does not necessarily reflect the views of the LEDS GP Global Secretariat or of the LEDS regional platforms, working groups, communities of practice, and membership.