The Importance of Sustainable Investments along the Belt and Road - Establishing a Network of Sustainable Investment Promotion (SIP) Facilities with Ethiopia as the Early Pilot

The Belt and Road Initiative (BRI) has potential as an accelerator for the Sustainable Development Goals (SDGs). The development challenge is to ensure that the BRI also helps realize host countries’ objectives on sustainable social and environmental development and provision of regional and global public goods.

The pilot at the country level aims to provide a scalable blueprint on how investments can be more sustainable responding to partner countries national development and economic priorities. The pilot SIP facility is designed on a two-phase approach. In the short term, it will develop a pilot facility in Ethiopia to generate i) concrete, relevant and effective modalities for sustainable investments; and ii) concrete lessons and recommendations on how positive development impact can be achieved- what approaches, policies, mechanisms work within an investment climate at the national level (and which ones do not). In the intermediate and long term, the approach can be scaled up as part of a network of sustainable investment facilities in other developing countries

Status:

Ongoing

Project start date:

January 2019

Estimated end date:

December 2020

Focus area:

  • eradicate poverty in all its forms and dimensions
  • Project office:

    UNDP in China

    Implementing partner:

    United Nations Development Programme

    Full project information  

    Funding Support by

    Donor name

  • Un Dept Of Economic And Social Affairs
  • Amount contributed

    $142,790

    Delivery in previous fiscal year

    2019 $0

    2018 $0

    Objectives:

    1.       To strengthen institutional frameworks and building capacity in a selected pilot country (Ethiopia) towards the leveraging of sustainable investments, in order to improve the overall investment climate to attract and sustain foreign investments that respond to the country’s national development priorities and local needs. Specifically, the SIP facility will:

    ·          Promote investments in a way that creates sustainable patterns.

    ·          Provide investment offer to match investment demand. 

    ·          Strengthen BRI partner countries’ capacities to better engage with BRI investment opportunities.

    ·          Forge mutually-beneficial and win-win cooperation for Chinese, international and local actors.

    ·          Promote positive early-harvest results and enhanced communication.

    2.       The short-term goals are to provide a framework of cooperation to leverage sustainable investment opportunities, show early and positive results, bridge communication gaps and ensure BRI investments complement existing programs with local stakeholders fully engaged.

    3.       The long term and intermediate goals are to improve the overall investment cooperation and conditions towards a sustainable, forward-looking path, and to tie investment promotion approach with well-structured, local institutions that have embodied local needs and development priorities of partner countries.

     

    Expected results (EA):

    EA1 Enhanced knowledge, information exchange and communication on BRI related investments, fostered knowledge and experience sharing on sustainable investment among multiple stakeholders in the selected pilot country and established a learning and capacity building network towards presenting investment policy as well as governance solutions to identified hindrance /bottlenecks of FDI.

    • A1.1 Organize Business to Business (B2B) match-making in Addis Ababa, Ethiopia to leverage investment opportunities with local demands, and for in-depth discussions based on real business practices (e.g. procurement, funding, resources).
    • A1.2 Organize a BRI-SIP dialogue in Addis Ababa, Ethiopia to exchange understanding, knowledge and practices on sustainable investment, and to develop a comprehensive Action Plan on facilitating sustainable investment in Ethiopia.
    • A1.3 Organize a policy dialogue in Beijing, China, zooming in specific angles and themes that are mutually interested on the BRI related investment.
    • A1.4 Organize a training program (or a knowledge sharing workshop) in Beijing, China, tentatively to invite a total number of 35 trainees from line ministries, private sector in both Ethiopia and China.

    A1.5 Develop and maintain a BRI-SIP information platform to provide both general and tailored information and analysis on i) country, ii) sectoral/ industrial, and iii) projects and investment.

     

    EA2 Improved business environment and strengthened capacities of policymakers in the selected pilot country to identify regulatory and institutional gaps in adsorbing, sustaining and upgrading foreign investments in linage with national development priorities and local needs.

     

    ·       A 2.1 Draft and launch a diagnostic study on ESG/ sustainability aspects of Investment promotion and facilitation and to develop a practical guideline (or a manual / working paper) with SIP best practices and cases included.

    ·       A 2.2 A team of international senior experts will identify policies, procedures and practices that may pose as macro-level investment barriers and challenges reducing investment attractiveness or increases transaction cost.

    ·       A 2.3 A team of international senior experts will provide tailor-made, micro-level de-risking analysis or policy advice in specific investment sectors.

     

    EA3 Enhanced sustainability scale and level of the selected investment as the pilot project, with the successful practices and development impacts thoroughly demonstrated and to be further scaled up/replicated later within and out of the selected pilot country.

    ·       A3.1 A team of national and international senior experts will, based on both desk writing and field visits, provide five advice and analysis on project screening or de-risking in social and environmental aspects for 1-2 pilot projects.

    ·       A3.2 A team of national and international senior experts will, based on both desk writing and field visits, take part in project monitoring and assessment on the development impact of the pilot projects, and summarize three successful practices (e.g. effective measures, active engagement, innovative business models, UNDP interventions).

    ·       A3.3 Organize a two-day tailored activity (e.g. media tours) to increase international exposure of the demonstration project (e.g. project-level information, results and outcomes, key milestones, lessons learnt and good practices) through site visits and multiple communication platforms, targeting a total number of 50 participants involving journalists, policy makers, investors and development practitioners.

     

    Years

    Budget

    2019

    660,112.96 USD

    2020

    427,815.96 USD

     

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