Category: China-India-Africa

From Davos to New York: The Bridge Tank explores new blue finance initiatives

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The Bridge Tank’s presence in Davos, Switzerland during the World Economic Forum 2023 and its participation to the UN 2023 Water Conference in New York set two new milestones in The Bridge Tank’s research on innovative financial tools in support of hydro-diplomacy, in the weeks following the launch of the World Water for Peace Conference.

On Thursday, January 19th, 2023, the promotion of transboundary water cooperation found a home at the House of Switzerland in Davos. Represented by its chairman, Joel Ruet, and board member Raphael Schoentgen, The Bridge Tank attended an event on “Innovative Impact Investing through Blue Peace Bond” co-organised by the United Nations Capital Development Fund (UNCDF) and the Swiss Agency for Development and Cooperation (SDC). Two months later, on March 23rd, during the UN 2023 Water Conference, The Bridge Tank took part in a second session on this very topic at the UN Headquarters in New York, through the presence of Joel Ruet and Cédric Terrasson, Editor & Junior Analyst.

These two sessions presented the vision and the potential of the Blue Peace Financing Initiative, a promising new blue finance programme which aims to use water and transboundary rivers as an entry point for peace-building and socio-economic development. The programme will help develop and provide financial support to multi-sectoral cooperation frameworks pursuing sustainable and integrated co-management of transboundary rivers and water resources. Blue Peace will help scale up those frameworks and their associated investment plans by issuing Blue Peace Bonds, which will facilitate access to public and private capital.

This is of particular interest for River Basin Organisations (RBOs) all around the world, as the pilot projet for which the first Blue Peace Bond will be issued in 2023 has been developed in support of a West-African RBO, i.e. the Gambia River Basin Development Organization (Organisation pour la mise en valeur du fleuve Gambie, OMVG).

Investing in Water for Peace and Development

In keeping with the UN Sustainable Development Goals, the Blue Peace Financing Initiative aims to provide affordable, inclusive, and safe access to water-related services in order to ensure food security, access to clean drinkable water, and affordable green energy.  

Patricia Danzi

The programme approaches water as a vector for peace, cooperation, and socio-economic development by fostering a more equitable, sustainable, and peaceful integrated management of transboundary water resources.

The Davos session was opened by Patricia Danzi, Ambassador, Director General, SDC, and moderated by Christian Frutiger, Ambassador, Assistant Director General, SDC, who gave the floor to the following panellists to discuss the vision and structure of Blue Peace:

  • Jaffer Machano, Global Program Manager, UNCDF
  • Rukan Manaz, Program Specialist, Blue Peace Financing, UNCDF
  • Hans-Ruedi Mosberger, Head of Asset Management and Sustainability, Swiss Bankers Association SBA
  • Matus Samel, Research Manager, Economist Impact
Christian Frutiger
Rukan Manaz & Jaffer Machano
Hans-Ruedi Mosberger

At the UN 2023 Water Conference, the session was opened by Mourad Wahba, Officer in Charge, United Nations Capital Development Fund (UNCDF) and saw contributions from:

  • Daouda Samba Sow, Secretary General, OMVG
  • Rohey John Manjang, Minister of Environment, Climate Change and Natural Resources, The Gambia
  • Usha Rao-Monari, Under-Secretary-General and Associate Administrator of UNDP
  • Benjamin Powell, Head of Sustainable Debt Capital Market, Skandinaviska Enskilda Banken (SEB),
  • Tania Rödiger-Vorwerk, Deputy Director General, Federal Ministry for Economic Cooperation and Development (BMZ), Germany
  • Marjeta Jager, Deputy Director General, DG INTPA, European Commission
  • Douglas R. Eger, Chairman & CEO, Intrinsic Exchange Group
Supporting RBOs to foster change

Representing the UNCDF, Jaffer Machano and Rukan Manaz introduced the approach and structure of the Blue Peace Financing Initiative to the Davos audience. With pressure on water resources having become one of the great challenges of our times, water has become a source of tension and conflict in many regions around the world. Trying to break this downward spiral, the ambition of Blue Peace is to turn this contentious issue into an entry point for cooperation and sustainable development.

Blue Peace’s goal and overall mission is to generate and support water cooperation initiatives and develop a common understanding of transboundary water resources management by encouraging data-driven decision making. To reach this objective, Blue Peace comes in support of local & regional non-sovereign entities in charge of water management, e.g. River Basin Organisations.

Blue Peace’s support is structured around two essential activities:

  1. Capacity building and technical development;
  2. Facilitating access to public and private capital through an innovative financial tool, i.e. Blue Peace Bonds.

This is best exemplified through the Blue Peace Financing Initiative’s pilot project.

A Pilot Case in West Africa: the Gambia River Basin Development Organization
1. Capacity building and technical assistance

The Gambia River Basin Development Organization (OMVG) is an RBO which handles the co-management and development of the Gambia River Basin. It comprises four member states, from the springheads to the delta of the Gambia River: Guinea, Guinea-Bissau, Senegal, and Gambia.

In December 2019, the OMVG and the UNCDF signed  a Collaborative Partnership into existence between the two organisations. The OMVG Council of Ministers subsequently issued a resolution (Nr.13/CM/45/B/G) green-lighting the development of the “OMVG Masterplan for the Integrated Development of its river basins, which will serve as the basis for the OMVG joint investment plan.” Such a Masterplan covers projects as diverse as the development of hydro-power, access to drinking water, natural parks, irrigation of farmlands, or transport and navigation systems.

This encapsulates the first stage of Blue Peace. The technical assistance and institutional capacity building supports the development of this multisectoral masterplan, offering a long term development perspective carried out by the joint investment plan.

2. Facilitating access to capital

In the second stage of the Blue Peace Financing Initiative, the partnership between the OMVG and UNCDF helps equip “the OMVG with the adequate tools to develop innovative financing mechanisms that will enable it to directly access the financial markets through the issuance of bonds.”

In order to scale up and meet the objectives of the masterplan and joint investment programme, the regional sub-sovereign entity (in this case the OMVG, a multi state organisation) will issue a Blue Peace Bond in order to mobilise capital. This is done through a Special-purpose entity (SPV) created and owned by the River Basin Organisation, which is in charge of managing and implementing the Investment Plan.

Building on the Masterplan for integrated development, the portfolio approach of the Blue Peace Bonds allows to combine large infrastructure projects that are generating revenue with smaller but equally important projects which have a higher dependence on subsidies. This diversification and cross-subsidization offered by Blue Peace Bonds helps derisk investments while also funneling funds to smaller projects.

Blue Peace Financing Partners support the Blue Peace Bond by mobilizing banks and investors, while also contributing to the de-risking of the Bond. The SPV is in charge of repaying interest and principal through the cashflow of underlying projects. In 2023, the first phase of capital mobilization will cover between 500 and 750 million USD, with 2 billion USD in perspective over the coming years.

Facilitating future Blue Peace projects

A tool which will play an important role in supporting the Blue Peace Financing Initiative is the Blue Peace Index. Matus Samel, Research Manager, Economist Impact, introduced the index to the participants as a tool measuring the extent to which countries and basins manage their shared water resources in a sustainable, equitable and collaborative way.

The index analyses 74 qualitative and quantitative indicators across five domains:

  • Policy & legal frameworks – development of legislative and regulatory frameworks at national and basin level
  • Institutions & participation – institutional arrangements for cross-sectoral coordination, capacity building and information sharing
  • Water management instruments – implementation of water management mechanisms
  • Infrastructure & financing – implementation of sustainable investment in water management
  • Cooperation context – exposure to major drivers and risk factors to peace

The Index provides an overview of the enabling environment for financing and investment in transboundary water management. The Blue Peace Financing Initiative Readiness Assessment will promote suitable investments by helping identify appropriate actors to support.

Matus Samel
Attracting Investors for Blue Peace

As noted by Hans-Ruedi Mosberger, Head of Asset Management and Sustainability, Swiss Bankers Association, the Blue Peace Bond has the benefit of having been designed with the investor’s perspective in mind.

Mr Mosberger stated that investors do not like one-off investments; they favour scalable and replicable projects, which create a track-record reducing the risk of the investment. The diversification offered by the portfolio and cross-subsidization approach of Blue Peace, building on the Masterplan for integrated development, contributes to this improved risk-return.

The Blue Peace Financing Structure is a promising mechanism involving blended finance, i.e. using public funds to generate momentum and subsequently raise private capital, and non-sovereign bonds to create impact through water and transboundary rivers.

As however pointed out by the interventions of Mr Ruet and Mr Schoentgen during the Q&A session in Davos, this South-North cooperation must not only involve the Global North’s financial institutions but needs to incorporate the Global South’s financial institutions and service providers to serve as an opportunity for the Global South to develop and leverage its own financial ecosystem.

Raphael Schoentgen
Joel Ruet

“Chronicle of Three Deaths Foretold” – A call to action for the Fouta Djallon

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By Erik Orsenna, Joel Ruet, & Hamed Semega. Published in Diplomatic Courier on March 31, 2023.

“The forested highlands of Fouta Djallon are in danger, and that means six major African rivers, including the Senegal, Gambia, and Niger rivers could dry up with devastating impacts. There are clear, actionable steps we can take to save the highlands, write Erik Orsena, Joel Ruet, and Hamed Semega.

The three deaths are those of the Senegal, Gambia, and Niger rivers.

So are the countries to which they give their names, as without their life-giving waters, the lands reliant on them will dry out and eventually die. It isn’t just Senegal, Gambia, and Niger that rely on these rivers either, it is also countries such as Guinea, Mali, Burkina Faso, and Nigeria.

Erik Orsenna

Member of Académie française, Chairman, Initiatives for the Future of Great Rivers (IFGR)

 

Joel Ruet

Economist at the Institute for Interdisciplinary Innovation (i3), CNRS Chairman, The Bridge Tank

 

Hamed Semega

former Minister of water in Mali, former High Commissioner of the Senegal River Basin Organisation (2017-2022)

To read about IFGR, The Bridge Tank and OMVS’ side event on “The Fouta Djallon: Visions & Actions to Safeguard the Water Tower of West Africa” at the UN 2023 Water Conference, on March 24, 2023, click here.

The Fouta Djallon Highlands: A call to action & a roadmap for preservation presented at the United Nations

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The Fouta Djallon Highlands – the water tower of West Africa – are dying. These forested highlands in Guinea are home to the headwaters of some of West Africa’s largest rivers, e.g. the Senegal River, the Gambia River, and the Niger River. This jewel of nature provides water to a region of nearly 300 million people. Faced with the urgency of the accelerating degradation of the Fouta Djallon’s fragile ecosystems, The Bridge Tank, Initiatives for the Future of Great Rivers (IFGR) and the Senegal River Basin Development Organization (OMVS) joined forces to alert the international community and present a roadmap for action at the United Nations 2023 Water Conference in New York.

On March 24, The Bridge Tank, IFGR, and OMVS organized an official side event on “The Fouta Djallon: Visions & Actions to Safeguard the Water Tower of West Africa” with the official support of France and Guinea, represented respectively by Bérangère Couillard, Secretary of State for Ecology of France and by the Chief of Staff of Aly Seydouba Soumah, Minister of Energy, Hydraulics and Hydrocarbons, Republic of Guinea. The side event was organized in partnership with the French Development Agency (AFD), the French Water Partnership (PFE), the International Network of Basin Organizations (INBO), and the Geneva Water Hub.

Structure of the session:

  • Opening addresses by Bérangère Couillard, Secretary of State for Ecology of France, Erik Orsenna, President, Initiatives for the Future of Great Rivers (IFGR) & member of the Académie française, and Joël Ruet, President, The Bridge Tank
  • Presentation and assessment of the challenges facing the Fouta Djallon by Soufiana Dabo, Coordinator for Guinea, OMVS and Abderahim Bireme Hamid, Executive Secretary, Niger Basin Authority (NBA)
  • The role of river basin organizations and ongoing actions by Lionel Goujon, Head of the Water and Sanitation Division of the French Development Agency (AFD)
  • An action plan and a discussion on the solutions to safeguard the Fouta Djallon.

Rewatch the recording of the session on our YouTube channel (in French with English subtitles).

Erik Orsenna, Bérangère Couillard & Joël Ruet
Bérangère Couillard
Opening addresses at the United Nations Headquarters

Confirming France’s support for this UN side event moderated by Sophie Gardette, Director, IFGR, Bérangère Couillard, Secretary of State for Ecology, France opened the session with an address to the panel.

In her speech, Ms. Couillard introduced the importance of preserving the Fouta Djallon Highlands and their unique ecosystem in order to protect West Africa’s largest rivers, emphasizing at the same time the interdependence between the preservation of ecosystems and the availability of water, both in quantity and quality. Secretary of State Couillard also praised the work of the region’s river basin organizations, particularly OMVS, and their role in integrated water resources management at the level of transboundary basins.

This was an opportunity to remind the audience of France’s role in the development and promotion of Integrated Water Resources Management (IWRM) and to encourage a multi-sectoral approach, reconciling all stakeholders drawing on the resources of the Fouta Djallon and impacting its ecosystems. In conclusion, Ms. Couillard recalled the importance of the Water Convention and praised the pioneering role of Senegal and Chad, which were some of the first countries outside Europe to join the Convention.

Erik Orsenna
Bérangère Couillard & Joël Ruet
Erik Orsenna – The water cycle and the life cycle

As co-host and co-organizer of this event, Erik Orsenna, President, Initiatives fur the Future of Great Rivers (IFGR) & member of the Académie française, issued a call to action to preserve the forest and river ecosystems of Fouta Djallon. Faced with the complexity and elusive diversity of water, “most essential of all resources,” Mr. Orsenna stressed the importance of using concrete characters and stories to convey the challenges of water resources management and preservation.

Rivers, and in particular the great rivers Senegal, Gambia, and Niger in the case of Fouta Djallon, form this unity of life, these living characters whose stories can be told. Quoting one of his predecessors at the French Academy, Jacques-Yves Cousteau, Mr. Orsenna thus noted that “the water cycle and the life cycle are one.” Biological health, economic health and social health are thus closely intertwined.

This unity of the cycle of water and the cycle of life is also found in Africa: 60% of the drinking water consumed in Dakar and 100% of that consumed in Nouakchott come from the Senegal River. Erik Orsenna also got to experience another theorem when he visited the shores of Lake Chad in Niger: “the less water there is in Lake Chad, the more terrorists there are.” “And it is for these two reasons that we decided to raise the alarm on the Fouta because the Fouta is the source of all this life in West Africa,” Erik Orsenna concluded.

Joël Ruet – Experiences from the field

Offering an account of his trip to the Fouta Djallon with Hamed Semega, former High Commissioner of the OMVS, Joël Ruet, President, The Bridge Tank & economist at the Interdisciplinary Institute of Innovation i3t, CNRS, began his address by paying tribute to Mr. Semega, with whom he went on this field trip and who was the first high commissioner to visit the sources of the Senegal River. The field mission revealed that the men and women, local populations living near the springs, were also suffering from the lack of water. Where there are only picturesque puddles left today, 10 or 15 years ago, these same pools were big enough for an adult to drown in. “It is now a matter of turning a vicious circle into a virtuous circle,” Joel Ruet said, adding that “the solutions are with the people, with the local communities, and it is our moral and human responsibility as an international community to help and support them in their initiatives.”

Joel Ruet & Soufiana Dabo
An agonizing Fouta Djallon

Soufiana Dabo, Coordinator for Guinea, OMVS, described the context of the Fouta Djallon before recalling the challenges and threats facing these highlands which are home to the sources of the Senegal River, the Gambia River, the Niger River and other smaller rivers. This mountainous territory in the north of the Republic of Guinea and extending towards Senegal, Mali and Guinea-Bissau is found at altitudes ranging between a little over 500 and 1515 meters, culminating on Mount Loura. The unique ecosystem of Fouta Djallon is now endangered and many endemic species, both fauna and flora, are growing rare.

The region is inhabited by sedentary farmers and herders whose activities coexist. However, demographic pressure has driven people closer to water sources in order to meet the growing need for water for agriculture and for the daily consumption of both communities and livestock. This growing pressure on sources has led to a decrease in the available water quantity but also to the degradation of riverbanks, impacting both Guinea upstream and the countries and 300 million people living downstream.

Abderahim Bireme Hamid, Executive Secretary, Niger Basin Authority (NBA), also noted additional degradation on the highlands inflicted by man. These include, for example, the production of baked bricks, excessive logging, and mining, particularly traditional gold mining.

The reduction of vegetation cover and the degradation of soils – a consequence of overgrazing and agricultural practices inappropriate to the demographic context, such as slash-and-burn agriculture and the reduction of the time these lands lie fallow have also contributed to the fragility of Fouta Djallon. These unsustainable agricultural and forestry practices reduce the forest cover and dry out the soil, threatening the stability of the ecosystems of the Fouta Djallon. These dynamics accelerate desertification and the silting up of waterways and of their springs, thereby also reducing the absorption capacity of soils. The threat is also environmental, since climate change affects the rainfall and the particular microclimate of Fouta Djallon, with temperatures constantly rising.

“Together we must mobilize our actions, efforts, awareness, and knowledge around what needs to be done now to restore this ecosystem […], to raise people’s awareness but also to allow them to continue their activities without being in conflict with nature,” Mr. Dabo concluded.

“If we do not act proactively to change the situation and to revive the Fouta Djallon highlands, the risk will impact all of these countries (the 9 member states of the NBA) and all of these populations in Africa,” Mr. Hamid concluded.

River basin organizations at the heart of preservation efforts

Lionel Goujon, Head of the Water and Sanitation Division of the French Development Agency (AFD) presented the existing preservation and sustainable management initiatives as well as the actions already carried out in the field by the AFD. These have been developed and carried out in partnership with the various basin organizations of the region. The presence of senior officials of these basin organizations, with Mr. Soufiana Dabo for the OMVS, an organization that AFD has been supporting for about 40 years, and Mr. Abderahim Bireme Hamid for the NBA, with which AFD has been collaborating for about 20 years, illustrated the investment and the central role of these organizations in the management of water resources and the preservation of the region’s ecosystems.

It is about avoiding the tragedy of the commons and the unfolding tragedy of Fouta Djallon, Mr. Goujon stated, referencing Elinor Ostrom, Nobel Prize in Economics in 2009. The challenges in the conservation efforts are numerous: lack of knowledge about the declining resource and its ecosystem, lack of measurements, and lack of data on the consequences of ongoing hydrological changes, as well as the need for new technologies and human resources and devices to maintain measurement networks.

AFD’s action in partnership with basin organizations is structured around projects such as the SCREEN project with OMVS, a project of altimetric measurements with satellite technologies in collaboration with French actors like CNR, IRD, BRL, and CNES. The DYNOBA project for the revitalization of transboundary basin organizations in Africa encourages the sharing of experiences between basin organizations. The Fouta Djallon could be a field of application of this exchange. AFD is also currently working on a project to support Guinea’s national meteorological services to strengthen national meteorology and produce more reliable data.

“There are several levels to work on: institutional, international, national, and local with the populations in order to have a beneficial impact on this region,” Mr. Goujon concluded.

An action plan for the Fouta Djallon

The objective of this side event was not only to alert the international community on the alarming situation of a dying Fouta Djallon but also to present an action plan and the key avenues of action for the preservation of the highlands. Joel Ruet, President, The Bridge Tank & economist at the Interdisciplinary Institute of Innovation i3t, CNRS presented some essential features of such an action plan.

  1. Supporting and mobilizing local communities by establishing a catalogue and an academy of durable best practices, combining both traditional and modern agricultural and ecosystem preservation methods, e.g. resilient agroforestry, to raise awareness and train local populations;
  2. Fostering local and regional research and innovation to increase knowledge and data of the Fouta Djallon’s resources and ecosystems. This will be achieved by establishing and supporting incubators of technological startups, supporting academic research projects, local environmental engineering, and the development of nature-based solutions;
  3. Fostering political will and regional cooperation by creating an assembly of West African states, RBOs, and multilateral organizations, backed by the international community, for the Fouta Djallon to develop a regional cooperation framework around this common resource and ensure social, societal, and environmental sustainability in the highlands and across the region;
  4. Mobilising new green finance mechanisms in support of the Fouta Djallon by establishing a green-blue bond dedicated for the preservation of biodiversity and the development of the highlands with international support.

In the continuity of the actions already implemented, concerted action across the sub-region to preserve the Fouta Djallon will have to involve basin organizations. The issue of governance was also highlighted by Lionel Goujon, who advocated for a governance at different levels, involving basin organizations, states and sub-regional economic communities. “There is a need to create coalitions and cooperation platforms today,” Joël Ruet stressed, which will necessarily involve local communities, in order to determine which traditional methods need to evolve and what traditional knowledge can be mobilized as more sustainable and resilient farming or agroforestry methods. According to Soufiana Dabo, the priority is to adapt and rethink existing solutions.

A tool which will play an important role in this process is the Fouta Djallon Observatory set up by the OMVS. According to Mr. Dabo, it will allow to observe, analyze and act in the Fouta Djallon. Soufiana Dabo took the opportunity to call for support of the Observatory as a center of research, reflection and data collection necessary for the evolution of the highlands. This evolution aims at accompanying the communities in their transition, either towards other activities that will have less impact on the ecosystem of the highlands, or to modernize current practices and activities undertaken by local populations. Within the framework of its IWRM programs, OMVS has launched the first initiatives in this direction, including agricultural development projects and the establishment of irrigated and fenced areas to settle the population. The rehabilitation of fish reserves hopes to turn fishing into an alternative source of income.

“We must not oppose socio-economic and human development to nature and the environment,” Joël Ruet insisted.

Finally, a last community that needs to be mobilized are the young graduates of the region’s universities. Mr. Ruet emphasized the importance of local technological entrepreneurship. The support of incubators of young local entrepreneurs returning to the field after their studies would provide the human resources to sustain the measurement and data collection systems necessary for all preservation efforts. This data can also be mobilized for sustainable finance mechanisms that enable, according to Mr. Ruet, “transformational changes going to scale.”

This session is part of The Bridge Tank’s long-standing commitment to the preservation of the Fouta Djallon. At the World Water Forum in Dakar in March 2022, The Bridge Tank and IFGR had already co-organized a session on the issue of safeguarding the Fouta Djalon highlands, in partnership with OMVS and Organisation pour la Mise en Valeur du Fleuve Gambie (OMVG). Previously, Joel Ruet, President, The Bridge Tank, had also participated in a field mission in the Fouta Djalon led by our board member Hamed Semega, then High Commissioner of OMVS.

CGTN – Joel Ruet discusses China-EU relations and Chinese growth during Boao Forum 2023

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During this year’s Boao Forum for Asia 2023, Joel Ruet, President of The Bridge Tank, spoke with CGTN on three occasions, discussing Chinese PM Li Qiang’s speech during the forum and sharing his insights on current dynamics in EU-China relations.

In a first interview, Joel Ruet shared his analysis of Chinese PM Li Qiang’s speech during the forum’s opening ceremony. Mr Ruet noted that the speech “stressed continuity” in China’s economic policies & growth, presenting it as an “area of certainty” in a world of uncertainty. The role of Chinese growth in global growth will however require caution in the coming 2 years, as the past year saw a slight dip in domestic and foreign investments, which will most likely impact future growth. As noted by Joel Ruet, PM Li Qiang’s speech acknowledged the need for continued foreign investments to balance this out.

In a second interview, Joel Ruet gave a short overview of current dynamics in EU-China partnership, competition, and rivalry, noting the role of values for both the EU and China in the structuring of their relationship.

Finally, Joel Ruet sat down with CGTN’s Xu Qinduo on CGTN Dialogue to discuss China-EU relations ahead of French President Emmanuel Macron and European Commission President Ursula von der Leyen’s visits to China.

The Bridge Tank at BOAO Forum for Asia 2023: Advancing EU-China cooperation and energy transitions

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From 28 to 31 March 2023, The Bridge Tank, represented by its president Joël Ruet, took part in the BOAO Forum for Asia 2023, in Boao, Hainan, China. The Bridge Tank has taken part in the annual meeting of the “Chinese Davos” as a partner of the event since 2018. This year’s BOAO Forum was placed under the theme “An Uncertain World: Solidarity and Cooperation for Development amid Challenges.”

The Forum saw Joël Ruet take part in two sessions dedicated to the China-EU dialogue, with a closed-door CEO roundtable, and a panel session on global energy supply shocks, both concretely addressing energy transitions. The forum’s plenary session provided contributions from Chinese Premier Li Qiang, former UN Secretary General and now chair of the forum Ban Ki Moon, as well as Lee Hsien Loong, Prime Minister of Singapore, and Pedro Sanchez, Prime Minister of Spain, addressing future relations between China and the EU and the potential for partnerships.

China-EU CEO closed-door Dialogue

The roundtable which Joël Ruet took part in addressed questions and opportunities of cooperation and competition in a context of systemic rivalry. The session allowed for interaction between industry captains from France, Italy, Finland, Hungary, & Germany and their Chinese counterparts. These notably included:

  • Justin Yifu Lin, Dean of Institute of New Structural Economics, Peking University & former Chief Economist and former Senior Vice President of the World Bank
  • Li Zixue, Chairman and Executive Director, ZTE Corp
  • Zhang Yue, Chairman, BROAD Group
  • Li Yong, Chairman, Chinayong Investment Group
  • Joël RUET, Chairman, The Bridge Tank & Associate Researcher, Tech for Change Chair Ecole Polytechnique
  • Jorge Toledo, Ambassador of the European Union to China
  • Denis Depoux, Global Managing Director, Roland Berger
  • Norbert Csizmadia, President, John von Neumann University Foundation
  • Gianni Di Giovanni, Chairman, ENI China B.V. & Executive Vice President, ENI
  • Fabrizio Ferri, Head of Asia Pacific Region, Fincantieri

Joël Ruet’s participation to this roundtable allowed him to convey the current situation and opportunities in matters of energy transitions, particularly around nuclear power and hydrogen. Reflecting on current trends, Mr Ruet noted that in 2022, the EU’s transition found a winning long term hedging strategy based on geographically hedged gas instead of oil, with a 2030 horizon hedging against all fossil fuels.

On matters of climate finance, Joël Ruet argued that financial mechanisms had to go beyond carbon pricing and beyond mitigation finance. Instead, adaptation must be financed through cobenefits on agriculture, agro-forestry, CO2 fixation in soils and water preservation. This requires a joint effort to build a finance and banking derisking industry both at the level of public and commercial banks. China and the EU have a common interest in not only sharing ideas and models but also in building joint programs with least developed countries, Mr Ruet argued.

In a subsequent interview for China Business News, Joël Ruet stressed the importance of these types of roundtables, as “business decisions are based on this kind of relationship and understanding between people.”

Global Energy Supply Shock Roundtable

On March 30th, Joël Ruet sat down with senior Chinese and international executives and experts for a roundtable discussion on the current energy supply and demand structure. The discussion touched on how Russia’s invasion of Ukraine reshaped Europe’s energy supply landscape and how the global energy structure has evolved since, taking into account sanctions imposed on Russia and production restriction policies adopted by oil producing countries in the Middle East. The session also tackled how to maintain the stability of the international energy market and what the implications of these changes are on energy transitions efforts around the world.

The session moderated by ZHONG Shi, CGTN Anchor, was joined by :

  • Denis DEPOUX, Global Managing Director, Roland Berger
  • Gianni Di GIOVANNI, Chairman, ENI China B.V. & Executive Vice President, ENI
  • MENG Zhenping, Chairman, China Southern Power Grid
  • Joël RUET, Chairman, The Bridge Tank & Associate Researcher, Tech for Change Chair Ecole Polytechnique
  • Ernie THRASHER, Director, Xcoal Energy & Resources
  • ZHONG Baoshen, Chairman, Longi

According to Joël Ruet, the energy crisis is an opportunity to better understand the strengths and weaknesses of current energy structures, what is resilient, and what is most affected by these shocks. “We should turn the crisis into an opportunity,” Mr Ruet stated, adding that “in the energy transition, we must be inclusive and united.” What is stirking in the EU’s response over the last year is that it was not just a short term shock answer but that it paves the way to structural acceleration in energy transition, notably on pure renewables or gas. The fact that various countries have various energy strategies on nuclear as renewable or hydrogen uses or mobility engines hasn’t prevented quantum jumps in taxonomy and serves a positive complement thus hedging in European energy transitions.

Takeaways from the plenary session

BOAO Forum’s plenary session saw leaders from all around the world taking the stage to discuss current affairs. After stressing that “Russian agression has undermined the world order,” Singapore Prime Minister Lee Hsien Loong insisted that beyond building strong relations with China, Asian countries needed to mesh with one another, highlighting ASEAN’s centrality. Praising the RCEP and trans pacific dynamics, PM Lee called for Asia to always remain an open region building partnerships.

Pedro Sanchez, Prime Minister of Spain, stated that in its upcoming capacity assuming the presidency of the EU, Spain wants to contribute to peace and trust rebuilding. The country wants to focus on having a renewed approach to globalization, one mindful of its environmental footprint and stability, moving beyond sole cost preoccupations. The EU is therefore building a new green and digital industry and will defend its values and interests. China and the EU, though competitors, can also remain partners as far as the sovereignty of countries is respected and a level playing field on competition is upheld. According to PM Sanchez, China and the EU must remain partners economically but also and most importantly work together on reaching the objectives set in the Paris agreement, the SDGs, and providing finance for development and debt risks for developing countries.

BOAO Chair Ban Ki Moon
Singapore PM Lee Hsien Loong
Spain PM Pedro Sanchez
Chinese Premier Li Qiang

Joel Ruet also attended Chinese Premier Li Qiang’s address to BOAO forum delegates. In his speech, Premier Li stated that “without peace, Asia won’t have a bright future,” before adding that “the many issues facing humanity must be addressed through consensus.” To do so, Li Qiang emphasized the role of BRICS countries in enforcing a multilateral rule of law, qualifying as “more just and equitable” than the existing UN system.

Li Qiang stated that “in an uncertain world, China’s way to prosperity is an anchor of certainty,” stressing the importance of China’s growth for developing countries in general and for Asia and the global economy. China’s path forward will “continue the effort of deepening the demand while structuring the supply side in a way that is favourable to foreign investment.”

It is however to be recalled that investments reached a low in 2022 due to China’s zero covid policy, which will have an impact on economic results in the coming two years and weakened foreign confidence in the Chinese market. This short term cycle will have to be absorbed, with medium term prospect looking more encouraging and serving as a transition while the demographic window of opportunity is closing.

Watch Joel Ruet’s analysis of Chinese Premier Li Qiang’s speech for CGTN:

UN 2023 Water Conference: The Bridge Tank and Initiatives for the Future of Great Rivers organise a side event on the preservation of the Fouta Djallon Highlands

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Preserving the Fouta Djallon Highlands in Guinea, a region commonly referred to as the water tower of West Africa, harbouring the sources of the region’s largest rivers, brought together The Bridge Tank, Initiatives for the Future of Great Rivers (Initiatives pour l’Avenir des Grands Fleuves, IAGF), and the Senegal River Basin Development Organisation (Organisation pour la mise en valeur du fleuve Sénégal, OMVS), who together organized an official side event of the UN 2023 Water Conference on Friday 24 March, under the patronage of France and Guinea.

These forested highlands are more than ever at risk – endangered by the combined actions of populations left stranded by misdevelopment, livestock that needs more resilient practices, and the effects of climate change calling for agrarian and forestry adaptation within reach. This conference and the presence of high ranking government officials from France and Guinea, including Bérangère Couillard, State Secretary for Ecology, French Republic, and the chief of cabinet of Aly Seydouba Soumah, Ministre of Energy, Hydropower and Hydrocarbons, Republic of Guinea, as well as senior representatives from West African River Basin Organisations, like Soufiana Dabo, Guinea coordinator, OMVS and Bireme Hamid Abderahim, Executive Secretary, Niger Basin Authority, and development actors active on the ground offered a unique opportunity to raise the alarm and call for concerted action.

Erik Orsenna & Bérangère Couillard

Opening the session as keynote speaker, Bérangère Couillard, State Secretary for Ecology, France, stressed the importance of protecting the Fouta Djallon and the sources of West Africa’s largest rivers, and reminded the audience of France’s central role in developing integrated water resources management.

Erik Orsenna, President, Initiatives for the Future of Great Rivers, made a passionate plea for action to preserve these forested ecosystems which provide water to a region home to 300 million people. He particularly emphasized the importance of river basin organisations in preserving peace and generating transboundary cooperation as the region battles with increasing hydric-stress.

Joel Ruet & Soufiana Dabo
Lionel Goujon
Abderahim Birémé Hamid

Representing such an RBO which has contributed to development and cooperation in West Africa, Soufiana DABO, Guinea coordinator, OMVS, introduced the specific context of the Fouta Djallon and the risks weighing upon its sources, from deforestation to siltation of watercourses and obsolete agricultural practices.

Lionel Goujon, Head of Water & Sanitation at the French Development Agency presented the existing initiatives and actions already carried out on the ground, particularly in partnership with the region’s River Basin Organisations.

Joel Ruet, President, The Bridge Tank, introduced a roadmap of solutions to safeguard the Fouta Djallon, including the need to involve young local technological entrepreneurs, training local populations, and mobilising green finance to scale up actions of the ground. The importance of mobilising local populations with their knowledge and nature-based solutions was also highlighted by the Executive Secretary of Niger Basin Authority, Mr Abderahim Birémé Hamid.

This side event organised inside the United Nations Headquarters was placed under the patronage of Guinea and France, and was supported by the French Development Agendcy (Agence Française de Développement, AFD), the French Water Partnership, the International Network of Basin Organizations (INBO), the Geneva Water Hub and the Chair Technology for Change of École Polytechnique.

G20/Business 20: Second meeting of the B20 India Task Force on Energy, Climate Change & Resource Efficiency

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The Bridge Tank’s presence in New Delhi, India, for the CII Partnership Summit 2023 from 13-15 March saw Joel Ruet, President, The Bridge Tank, take part in the second meeting of the B20 India Task Force Energy, Climate Change & Resource Efficiency. As a member of the task force, The Bridge Tank had participated in its first meeting during the Inception Meeting of the Business 20 (B20) Engagement Group of the G20, on January 24th, 2023, in Gandhinagar, India.

The task force’s second meeting, on March 15th, raised three central topics: (1) accelerating net zero transitions, (2) a greater overall contribution of green energy, including green hydrogen and ammonia, and (3) an improved access to finance for these transitions. In keeping with one of the objectives of India’s G20 presidency, the task force has stressed the importance of including developing countries in these developments.

Notably, the stress was put on the fact that, while global ESR and non-financial standards as well as technology push through state support is needed, there is a capital cost advanatge for some countries which others do not have. Therefore, even more than human resources support or technology transfer assistance, to include developing countries, there is rather a need for a financial level-playing field, some argued, among which The Bridge Tank. While recommandations that Multilateral Developement Banks and private funds address this seriously were made, part of the debate revolved around the idea of focusing public money onto de-risking, and, The Bridge Tank argues, at involving local, national, and regional financial ecosystems into then de-risked project pipelines.

Besides, if one ventures out of the solutions only fitted for G20 countries – as India’s G20 presidency wishes to have G20 adhere to Africa’s issues for instance – then there is an debate opening up on the unequal data capacity across the world, which may add-up to capital cost inequality. This is a line of contribution we will keep feeding into the task force until its third meeting in April and final meeting in June.

Discussions and feedback between the task force’s first and second meeting raised numerous additional issues; these include establishing global standards for hydrogen, assessing the life cycle and scope for recyclables, setting provisions for domestic and international transactions on carbon and facilitating access to finance and technology. Furthermore, it is crucial to include and recognize the role mico, small, and medium entreprises have to play. As noted by some members of the task force, clear results and actions are required, as the cost of inaction on adaption to climate change would be dire, notably for coastal regions.

The meeting was convened by some of India’s leading industry captains:

  • Mr Sajjan Jindal, Chairman & Managing Director, JSW Group, chair of the task force
  • Mr Vineet Mittal, Chairman, Avaada Group, vice chair of the task force
  • Mr T V Narendran, Managing Director, Tata Steel, vice chair of the task force
  • Mr Chrstian Cahn von Seelen, Executive Committe memebrr Volskwagen, vice chair of the task force
  • Mr Jean-Pierre Clamadieu, Chairman of the Board, ENGIE, vice chair of the task force (represented by his head of staff)

G20-Business20-CII Partnership Summit 2023: The Bridge Tank discusses resilient green supply chains

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On the last day of this year’s CII Partnership Summit 2023 in New Delhi, India, Joel Ruet, President, The Bridge Tank, took part in a session on ‘Building Resource Efficient & Resilient Green Supply Chains.’

The 28th edition of the summit organised by the Confederation of Indian Industry (CII) from 13-15 March 2023 dedicated to questions of global trade, economy, competitiveness, sustainability and technology was convened with the theme “Partnerships for Responsible, Accelerated, Innovative, Sustainable, and Equitable Businesses.” This comes as the CII is serving as secretariat of the B20 (Business 20) during India’s 2023 G20 presidency. The Bridge Tank, represented by its president Joel Ruet, was invited by the CII to join in the high level discussions in New Delhi.

On March 15th, Joel Ruet sat down with Dr Martin Keller, Lab Director & Alliance President, National Renewable Energy Laboratory (NREL), and Mr Ashwani Kumar, CEO, Suzlon Group, in a panel discussion moderated by Mr Christian Cahn von Seelen, Member of the Board and Executive Director, Volkswagen Group Sales India on ‘Building Resource Efficient & Resilient Green Supply Chains.’

Dr Martin Keller
Christian Cahn von Seelen & Joel Ruet
Ashwani Kumar

During the discussions, Dr Joel Ruet noted that supply chains in a “stabilized world” needed optimization. However, in current times of uncertainty and instability, there is a real need to diversify supply chains and bring in options across countries, industries, and technologies.

This idea was echoed by Dr Martin Keller, who emphasized the need for global synergies on diversifying supply chains with regard to raw material availability, manufacturing capabilities, adoption of clean energy, circular economy & green skilling.

Mr Cahn von Seelen and Mr Kumar highlighted the role of green energy in these resilient supply chains. Mr Cahn von Seelen stressed how important it now was for the world to focus on sustainable energy supply chains to replace petrol. The example Europe has set by entirely changing its energy mix in the span of one year, following Russia’s attack on Ukraine, has shown that drastic changes are possible.

Mr Kumar went a step further, adding that we needed to look not only at how much of our energy consumption was green but how green the generated kilowatt-hour actually was. Such a process must start at R&D stage, enabling greater efficiency and providing a key contribution to green supply chains.

G20/Business 20 : The Bridge Tank takes part in the B20 India Inception Meeting

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After Indonesia’s tenure in 2022, the turn of the year saw India assume the presidency of the G20 for 2023.

From 22 to 24 January 2023, the city of Gandhinagar in Gujarat, India, hosted the Inception Meeting of the Business 20 (B20) Engagement Group of the G20 to discuss the global economy and some of the most pressing issues facing our world with the business community. The meeting gathered Indian Ministers and delegates, as well as influential international business leaders and policy makers.

As a member to the B20, The Bridge Tank attended the summit in Gandhinagar, represented by its chairman Joel Ruet. Besides the public sessions at the Mahatma Mandir, the Inception Meeting notably marked the launch of the B20 Task Forces and Action Groups, to which The Bridge Tank will be an active contributor in the year to come.

Focussing its participation on three great themes: sustainability, research & innovation, and bridging the gap between Africa and the G20, at the invitation of the Indian Presidency of the G20, The Bridge Tank is now member to both the B20 India Taskforce on Energy, Climate Change and Resource Efficiency, and the B20 India Action Council on African Economic Integration.

Joel Ruet at the B20 Inception Meeting
Setting the tone for India’s 2023 G20 presidency

Organised by the Confederation of Indian Industry (CII), which has taken up the B20 India Secretariat, the Plenary Sessions of the B20 Inception Meeting, held at the Mahatma Mandir on January 23rd, set the tone for the summit and for India’s year presiding over the G20.

The inaugural session highlighted the vision, thematic priorities, and values which will drive the B20 India. Mr Chandrajit Banerjee, Director General, Confederation of Indian Industry (CII), reminded participants of the acronym R.A.I.S.E – Responsible, Accelerated, Innovative, Sustainable and Equitable business – which will serve as the cornerstone of B20 India.

“The theme of the B20, which has been formed under the umbrella of G20 Presidency of India, is R.A.I.S.E. – Responsible, Accelerated, Innovative, Sustainable and Equitable business.”
Mr Chandrajit Banerjee
Director General, Confederation of Indian Industry (CII)

During his opening address on the requirements to deliver a successful B20 India, Mr N Chandrasekaran, Chair, B20 India, and Chairman, Tata Sons, stressed the role of reducing inequality thanks to digital transformation. He went on to underline some of the main priorities identified for B20 India, including sustainability, energy transition, mobility, biodiversity, water management and the UN SDGs.

"B20 presidency is an opportunity for India to showcase and share best practices as well as work towards developing specific recommendations on bringing equality using digital transformation.”
Mr N Chandrasekaran
Chair, B20 India & Chairman, Tata Sons
Sustainability and energy transitions:  B20 India Taskforce on Energy, Climate Change and Resource Efficiency

The centrality of the fight against climate change and the place of energy transitions and sustainable development in the B20 India priorities were introduced during the plenary session by Mr Som Parkash, Hon’ble Minister of State for Commerce & Industry​.

Minister Parkash said that “India, under G20 Presidency, needs to work towards prioritizing fight against climate change and environment degradation through efforts to reduce greenhouse gas emissions and promote clean energy.”

This priority, in line with B20’s R.A.I.S.E motto, was echoed one day later, on January 24th, during the first meeting of the B20 India Taskforce on Energy, Climate Change and Resource Efficiency, which The Bridge Tank attended as a member of the Task Force.

The meeting, chaired by Mr T V Narendran, B20 India Co-Chair of Taskforce on Energy, Climate Change and Resource Efficiency and CEO & MD Tata Steel Ltd, presented the task force’s priorities and expected outcomes.

Hoping to accelerate energy transitions, resource efficiency, and adaptation measures in G20 economies, the task force’s priorities were pointed out to be in broad alignment with G20 priorities on climate change.

The goal is thus to address the following key issues :

  1. global net zero transitions;
  2. energy security and energy access;
  3. just transitions;
  4. circular economy and resource efficiency;
  5. climate finance and technology innovation;
  6. adaptation and resilience.
“India, under G20 Presidency, needs to work towards prioritizing fight against climate change and environment degradation through efforts to reduce greenhouse gas emissions and promote clean energy.”
Mr Som Parkash
Hon’ble Minister of State for Commerce & Industry

The Task Force’s Priorities cover a variety of themes including:

  • Enhancing global cooperation in accelerating net-zero transition through global industry-specific coalitions, and channelling investments and financing towards global priorities and pathways;
  • Improving investments, development and commercialisation of green-energy technologies;
  • Improving climate finance through new financing pathways for energy transition, setting clear energy mandates for multilateral development banks, and harmonizing the development of national carbon markets;
  • Improving resource efficiency through regulatory frameworks, policies, business and financing models which encourage circular economy;
  • Implementing adaptation policies taking ecosystem-based approaches to provide resilient infrastructure, ensuring gender-inclusive adaptation, and mobilising finance for the implementation.

The expertise The Bridge Tank has accumulated over the years in energy trajectories and energy transitions, in addition to its various research and consulting projects centred on climate finance and blended finance but also contributing to the development of circular economy and sustainable development models will serve as valuable building blocks of The Bridge Tank’s contribution to the B20 Task Force, which will meet again on 14-15 March 2023.

Connecting Africa and G20: B20 India Action Council on African Economic Integration

Addressing B20 India’s efforts to represent the issues relevant to the global economy, Mr Sanjiv Bajaj, President of CII & Chairman & Managing Director, Bajaj Finserv Ltd, introduced the audience of the Plenary Session to the focused agenda and Action Council on the Economic Integration of Africa, which hopes to strengthen ties between African economies and the G20.

As a long-time advocate for a greater integration of the African continent in G20 actions and now a contributing member of the B20 India Action Council on African Economic Integration, The Bridge Tank salutes this initiative.

On January 24th, the last day of the Inception Meeting, The Bridge Tank thus also took part in the introductory session of the B20 India Action Council on African Economic Integration, which discussed the objectives and priorities of the council.

The meeting raised three main expected outcomes to bolster the economic integration of the African continent:

  1. The formulation of a Technical Assistance Facilities (TAFs) Programme by G20 members, in order to accelerate the AfCFTA implementation through technical and financial assistance to the 54 African nations
  2. Commitments by G20 states to each enter into customized Preferential Trade Agreements with at least 20 African nations (with a minimum of 100 tariff lines on products or services being liberalized in each of these agreements)
  3. Commitments by G20 states to each launch a minimum of 3 development finance programmes benefiting at least 5 African nations (either bilaterally or through multilateral institutions), covering themes like: industrial park programmes, energy or transport infrastructure projects, health, education and skilling initiatives, or micro, small, and medium enterprises funding programmes.
Expanding on these expected outcomes, Joel Ruet, Chairman, The Bridge Tank, put forward the idea of an origination fund for climate resilience & adaptation projects originating from and funded by the G20. In addition to that, the G20 could help derisk projects originated from African countries and companies.
 
The Bridge Tank will continue its efforts within both the the B20 India Taskforce on Energy, Climate Change and Resource Efficiency, and the B20 India Action Council on African Economic Integration in the coming months.

Davos 2023: The Bridge Tank’s takeaways from the World Economic Forum

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The third week of 2023 saw the world gather once again for the World Economic Forum in Davos. From January 16th to 20th, political, economic, and civil society leaders from around the globe met in the Swiss Alps to discuss the economic future of our world.

This year’s focus on “Cooperation in a fragmented world” proved a theme of particular interest for The Bridge Tank to exchange views with participants from all over the world on the state of international cooperation, particularly with regard to South-South and South-North cooperation.

The Bridge Tank was in Davos during annual meeting of the WEF, represented by its chairman Joel Ruet and board members Judit Arenas, from Mexico, Raphael Schoentgen, from Belgium, and Pranjal Sharma, from India.

This active presence on the ground saw our board members discuss the place of the Global South in the digital revolution, explore new financial mechanisms of South-North cooperation, organise events on global public goods, and provide an overview of the diverse ambitions and paths of major emerging markets.

Pranjal Sharma (left) at the TCS Reception
Judit Arenas at the Innovation Lunch
Raphael Schoentgen (right) at the House of Switzerland
The digital revolution and the Global South

A regulard speaker at the WEF, our board member Pranjal Sharma highlighted the role of the Global South, acting as a structuring force to shape the future. Pranjal Sharma particularly pointed to India’s role in strengthening digital economies in the Global South and the country’s efforts in bringing the digital revolution to new communities and new languages.

Building on this question of digital revolution, Mr Sharma convened a WEF panel discussion on “Tackling Harm in the Digital Era,” in which he addressed user safety in online environments and how to build safer digital spaces.

The high-level panel gathered the European Commission’s Vice-President for Values and Transparency, the UK’s Office of Communications Chief Executive, and the Deputy Prime Minister of Belgium to discuss regulatory frameworks and technological innovations to tackle harmful content, violence, and abuse online.

The discussion highlighted the challenges facing lawmakers, as Mr Sharma asked them how to manage digital harm at scale and how to ensure protection for communities not only in developed countries but also in emerging economies, as billions of people and new communities are coming online.

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Blue Finance: International rivers as a vector of South-North cooperation

The WEF also allowed discussing new forms of South-North cooperation. One such innovative mechanism on the blue finance front was discussed during  an exclusive event on “Innovative Impact Investing through Blue Peace Bond,” organised by the United Nations Capital Development Fund (UNCDF) and the Swiss Agency for Development and Cooperation (SDC) at the House of Switzerland.

The event, which Joel Ruet and Raphael Schoentgen attended, presented the Blue Peace Financing Program and the creation of the Blue Peace Bonds, which aim to facilitate access to capital for river basin organisations and similar local and regional entities working toward multi-stakeholder transboundary cooperation around water. This innovative tool to finance infrastructure and social development hopes to work as a peace dividend, by making water an entry point for peace and cooperation.

As pointed out by the interventions of Mr Ruet and Mr Schoentgen, this South-North cooperation must not only involve the Global North’s financial institutions but needs to incorporate the Global South financial institutions and financial services providers to serve as an opportunity for the Global South to develop and leverage its own financial ecosystem.

This session and the financial tool built on cooperation around water it presented came as a welcome contribution to The Bridge Tank’s research for new tools to mobilise within an expanded practice of hydro-diplomacy, just a few weeks after the launch of the World Water for Peace Conference.

The Bridge Tank’s Innovation Lunch 2023: Strengthening biosecurity cooperation

Concluding the week on the theme of cooperation, Joel Ruet and Judit Arenas joined forces on the last day of the forum to co-organise a luncheon discussion on Davos’ Promenade on the issue of biosecurity and bioterrorism. The event was the result of a partnership between The Bridge Tank, APCO Worldwide, and the American biotechnology company Illumina.

The session moderated by Joel Ruet and John Defterios, former CNN economic analyst and anchor, and senior advisor, APCO Worldwide, highlighted the fragility of national and international biosecurity frameworks and the lack of necessary biosecurity infrastructure, and called for greater public-private cooperation on this matter.

The select group of participants consisted of around 25 renowned biosecurity and cybersecurity specialists, high-level academics, and C-suite executives, like John Frank, Chief Public Affairs Officer, Illumina, Richard Hatchett, CEO, Coalition for Epidemic Preparedness Innovations (CEPI), or Frank-Jürgen Richter, Chairman, Horasis.

Frank-Jürgen Richter, Chairman, Horasis, & Joel Ruet
John Defterios

Focus on the pavilions and thematic sessions in Davos

The vibrant activity of the different national and corporate pavilions made for vivid discussions and for events on themes of interest for The Bridge Tank, i.e. emerging economies, sustainable development, and structuring energy transitions.

The India Lounge was an important meeting point at this year’s WEF. Joel Ruet attended a panel discussion on India’s environmental, social, and governance (ESG) investments and a business-government debriefing on the world’s – and particularly the US’ – readiness to reengage with China. One of the conclusions stressed that whether investments will remain in China or be relocated is something India will have to follow closely.⁦

This presence at the India Lounge was also an opportunity to meet with Samir Saran, President of the T20 Secretariat, and discuss The Bridge Tank’s involvement in the T20 during India’s 2023 G20 presidency. With themes of cooperation and inclusive growth at the heart of India’s presidency, The Bridge Tank will provide an active contribution to the T20 on themes of blue and green finance and bridging the gap between the African continent and the G20.

Samir Saran & Joel Ruet
Indonesia: Setting the course for a net zero future

Indonesia, which only recently handed over the presidency of the G20 to India, proved to be very active in Davos as well.

The Indonesian pavilion thus hosted a session on “Indonesia Net Zero Pathway: Opportunity & Challenges,” on January 17th.

A presentation by Muhammad Yusrizki, Chair of KADIN Net Zero Hub, Indonesia Chamber of Commerce, introduced some of the objectives and challenges ahead for Indonesia’s green transition, including how to finance the energy transition and de-risk investments in renewable sources in Indonesia but also the need for policies and institutional frameworks to accelerate the country’s journey to net zero.

Mr Yusrizki particularly stressed the need to protect and regenerate mangroves, as these have huge potential for carbon storage in a country home to more than 20% of the world’s mangrove areas.

Indonesia’s Coordinating Minister for Maritime and Investment Affairs, Luhut Binsar Pandjaitan, introduced Indonesia’s pathway and sectoral priorities to achieve net zero by 2060. Such a pathway would be based on industrialisation and economic development, Mr Pandjaitan said, as he reminded attendees that Indonesia’s per capita CO2 emissions were lower than the global average.

Indonesia’s green economy will be built on five pillars:

  • a decarbonized power sector – helped by the Just Energy Transition Partnership (JETP), which hopes for renewable energy to comprise 34 percent of Indonesia’s power generation by 2030;
  • low-carbon transportation – through the development of electric vehicles;
  • alternative fuels, e.g. biofuel;
  • green industries, e.g. by developing an EV battery supply chain;
  • carbon sinks – involving carbon capture and carbon offset market.

Indonesia hopes to make transportation an important pillar of this green economy. As the ASEAN’s largest automotive market, Indonesia represents 30% of the ASEAN 4-wheeler market and 50% of its 2-wheeler market. While the country still relies on imports, Indonesia hopes to become a production hub in the region, particularly for EVs, for which Indonesia is working to develop its own value chain.

Indonesia also aims to become a global leader in climate mitigation and in the carbon offset market. Replanting mangroves and restoring degraded ecosystems and lands are expected to be some of the key action areas, as panellists noted.

Africa House : Discussing AfCFTA & unlocking the continent’s future potential

The African continent provided its own contribution to this year’s WEF’s pursuit of cooperation in a fragmented world. Davos’ Africa House hosted a trade panel, titled “Deep-dive into the AfCFTA, exploring how far it has come and unlocking the continent’s future potential,” on January 18th.

Participants to the panel included:

  • Wamkele Mene, Secretary-General, AfCFTA Secretariat
  • Samaila Zubairu, President & CEO, Africa Finance Corporation
  • H.E. Princess Alanoud Bint Hamad Al Thani, Chief Business Officer, Qatar Financial Centre

The African Continental Free Trade Area (AfCFTA) encompasses 54 countries across the continent, with 44 state parties having already ratified the agreement. This free trade area however constitutes only 2.1% of global trade and 3% of the world’s GDP.

In his opening address to the panel, Wamkele Mene therefore noted that individual African countries will not be globally competitive on their own. Mr Mene went on to stress the African continent’s need for greater integration in order to develop economies of scale and overcome its reliance on the export of commodities of primary necessity.

The panel encouraged an accelerated implementation of the AfCFTA, as it provides a blueprint for Africa’s collective development and industrialisation. The COVID-pandemic played an important role in revealing Africa’s need to establish alternative supply chains. With Africa at the back of the queue for masks and vaccines, the need for the continent to become self-sufficient has arguably become more pressing.

Prof. Landry Signe & Wamkele Mene

Samaila Zubairu, President & CEO, Africa Finance Corporation, highlighted the fact that the value chains of products like cocoa, cashew nuts, and cotton are not in Africa; the processing of this production is carried out abroad before being re-imported. The same applies to EV vehicles, despite Africa being an important source of strategic materials with huge solar energy potential, Mr. Zubairu noted, before concluding that Africa suffered from a 100 billion infrastructure deficit, weakening its ability to grow.

While panelists commended AfCFTA’s efforts in interconnecting supply chains and regulations and appeared optimistic about the agreement’s success – finding inspiration in the process of European integration started at the end of WW2 which resulted in today’s European Union – considerable challenges remain to reach such a level of integration. A notable limitation is the absence of a protocol on freedom of movement between parties, as pointed out by a question from the attendance.

The Future of Supply Chains and Investments in Emerging Markets

A session organised at the DP World pavilion on “Unlocking Investments in Emerging Economies” addressed the significance of supply chains in today’s world, particularly in the aftermath of the COVID-19 pandemic. Panellists noted that the lack of investments in the less developed parts of the world created disruptions in supply chains. A greater integration of supply chains and investments in infrastructure would however allow the transmission of benefits to emerging countries.

The diversification of supply chains post-COVID, therefore, has the potential of benefiting countries like the Philippines or India, panellists noted, as they could take over parts of China’s role in supply chains. These changing dynamics have begun redistributing roles in international supply chains. The wish of countries like the US and Canada to bring supply chains nearer to home would for example benefit a country like Mexico.

The session’s moderator Frederic Sicre, Managing Partner, Tardis Advisors, therefore shed light on this evolving understanding of emerging markets, mentioning the acronym BIMCHIP (i.e. Brazil, India, Mexico, Chile, Indonesia and Peru) as a possible replacement for the BRICS label.

Participants however also pointed to the challenges resulting from current financial uncertainty, which has made access to capital more difficult. This financial uncertainty will dampen the investment potential in emerging markets, as investors will prioritize less risky investments in developed markets, panellists noted.

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