INDUSTRY 4INCLUSIVE AND SUSTAINABLE DEVELOPMENT

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1 INDUSTRY 4INCLUSIVE AND SUSTAINABLE DEVELOPMENT

2 We recognize that people are at the center of sustainable development and in this regard, we strive for a world which is just, equitable and inclusive and we commit to work together to promote sustained and inclusive economic growth, social development, environmental protection and thereby to benefit all. Rio+20 Outcome document The Future We Want June 2012 (paragraph 6)

3 The Millennium Development Goals and the post-2015 development agenda There is no doubt that the adoption of the Millennium Development Goals (MDGs) has engendered a common focus on priorities for the development community. The MDGs have played a catalytic role in addressing extreme poverty in its many dimensions while promoting gender equality, education and environmental sustainability. They have had a significant impact on lifting many of the world s poorest from abject poverty. The reality remains, however, that at their inception in the year 2000, the focus was more towards the development of the social sectors, while ignoring the importance of economic growth as a vital prerequisite to achieve sustainable development. It has since been recognized that in order to redress the situation, and to meet the many challenges faced by developing countries, including least developed and middle income countries, the post-2015 development agenda will have to take into account all three dimensions of sustainable development, namely economic growth, social inclusiveness and equity, and environmental sustainability. Indeed, this was the core message of the outcome document of the Rio+20 United Nations Conference on Sustainable Development held in June 2012, which tasked Member States with preparing a set of Sustainable Development Goals (SDGs). It has been echoed elsewhere, and articulated in such important documents as the new development policy of the EU and the 2012 ECOSOC Ministerial Declaration, as well as the report of the United Nations System Task Team established by the Secretary-General of the United Nations in January 2012 to prepare a system-wide vision for a post development agenda. The General Assembly is likely to consider new development goals in In order to prepare for this discussion, the Secretary-General appointed a High-level Panel (HLP) on the post-2015 development agenda in July 2012, co-chaired by the President of Indonesia, the President of Liberia, and the Prime Minister of the United Kingdom. The mandate of the HLP included the provision of recommendations on an agenda encompassing the three dimensions of sustainable development.

4 ThE ROLE Of INDUSTRY IN PROMOTING SUSTAINABLE DEVELOPMENT Economic development, and in particular the development of the productive sectors, is the critical driver of enduring poverty reduction. Indeed, it has been the process of economic development that has lifted 700 million people out of poverty in China. Industry plays a particularly important role in stimulating economic development and growth because of its transformative impact on production processes and the wealth that it creates through the addition of value to primary resources. Industry provides the foundation for entrepreneurship, promotes business investment, fosters technological upgrading and dynamism, improves human skills, creates jobs and establishes the foundation on which both agriculture and services may expand. It is therefore the principal source of employment creation and income generation. Industrial development is a key factor in bringing about structural change to set the economies of poor countries on the path of sustained economic growth, and lift people out of poverty. Of course, it is widely understood that the industrial development process needs to be pursued in a manner that is compatible with the other two dimensions of sustainable development i.e. the social and environmental dimensions. This is something that can be done. There are no inherent contradictions in the three dimensions of sustainable development when it comes to industry in fact, inclusive and sustainable industrial development is the only solution to meeting the global objectives of eradicating poverty and reducing income disparities while minimizing environmental damage.

5 Industry is the principal source of employment creation and income generation

6

7 The CONTRIBUTION OF UNIDO As the primary driver of economic growth and employment creation, productive industrial activities play a central role in poverty reduction. UNIDO, as the specialized agency of the United Nations system mandated to promote inclusive and sustainable industrial development and international industrial cooperation, is well-placed to make a significant contribution to this process. themselves, but with a range of partners, each of whom contributes their specific strengths and competences. These partners include, inter alia, multilateral and bilateral development organizations, non-governmental organizations, the private sector, and academia. Each of the Organization s three mutually reinforcing programmatic focus areas of poverty reduction through productive activities, trade capacity-building, and energy and environment is related to one or more of the three dimensions of sustainable development. The developmental interventions undertaken by UNIDO under these programmatic focus areas are designed to have a catalytic and transformative effect on the economic structures of the programme countries, with the aim of promoting economic growth and diversification in a socially inclusive and environmentally sustainable manner. Indeed, the Organization s medium-term programme framework for specifies equitable growth and sustainability as its principal country-level outcomes. In achieving these developmental outcomes, UNIDO draws on four categories of services, or enablers: technical cooperation, analytical and policy advisory services, standard setting and compliance, and convening for knowledge transfer and knowledge networking. UNIDO is aware that it can have the greatest impact on the economic growth of the world s poorer countries and people by teaming up not only with developing countries Within its programmatic focus area of poverty reduction through productive activities, UNIDO thus assists developing countries in their efforts to reach the MDG target of eradicating extreme poverty and hunger through programmes to support agribusiness and agro-processing for food security and food safety, facilitating investment and technology flows, and promoting the development of entrepreneurship and SMEs.

8 Through its technical cooperation activities and other services, UNIDO is able to strengthen the capacities of businesses and institutions. In providing these services, UNIDO takes account of the fact that the most vulnerable groups throughout the world are youth and women. There are more young people in the world today than ever before; with over one billion living in developing countries. Without access to jobs and the means to fulfill their ambitions, the youth are unable to achieve their economic potential and may even pose a threat to social stability. While important, the solution to their plight does not lie merely in providing them with a basic education and vocational training. UNIDO strongly believes that an education based on entrepreneurship development plays a vital role in developing the attitudes, skills and knowledge that enable youth to establish successful businesses, generate their own incomes, create jobs for others, and contribute to the sustainable economic growth of their communities and countries. The development and introduction of an efficient SME registration framework in Viet Nam is a good example of a UNIDO project, which has been instrumental in the growth of the SME sector in that country. The objective of the project is the promotion of private sector development by reducing risks and costs of doing business. The project has resulted in the establishment of National Business Registration System, and aims at simplifying business regulations, and providing real-time electronic data sharing among three ministries. The empowerment of women, and in particular their economic empowerment, has a positive impact on sustainable economic growth and sustainable industrial development. UNIDO aims, in its programmes, to integrate women into the growth and development process, which in turn, yields positive multiplier effects for households, communities and ultimately national economies. UNIDO recognizes the critical role played by trade as an engine for growth and the need to help developing countries trade their way out of poverty and marginalization in increasingly globalized markets. Through its thematic priority area of trade capacitybuilding, UNIDO offers its Member States a cohesive approach to market success, by strengthening the competitiveness of SMEs in developing countries and enabling them to comply with international standards and norms, and enter national, regional and global value chains. UNIDO s contributions in the field of trade capacitybuilding have been widely recognized. The European Union has become a major source of funding for UNIDO s activities in this area. An independent study published by the Norwegian Agency for Development Cooperation (Norad) in 2011, also singled out UNIDO as delivering good value for money in the field of standards and quality, an area where the Organization has a unique competence internationally.

9 MOZAMBIQUE: UNIDO has helped the government to formulate an entrepreneurship development syllabus for high schools to provide children with the skills and knowledge to establish their own businesses as job creators.

10 TURKEY: UNIDO has developed a three-year capacity-building programme for the Turkish textile sector, in partnership with other UN agencies, to enable the sector to become more productive, innovative and responsive to consumer requirements in developed and emerging markets.

11 Through its thematic priority area of energy and environment, UNIDO promotes access to sustainable energy for productive use, as well as supporting resourceefficient production and consumption through its Green Industry initiative. It also helps developing countries comply with multinational environmental agreements, such as the Montreal Protocol on Substances that Deplete the Ozone Layer, the Stockholm Convention on Persistent Organic Pollutants, and the Strategic Approach to International Chemicals Management. As an implementing agency of the Multilateral Fund for the Implementation of the Montreal Protocol, UNIDO has consistently been rated as the best performer in nine of the past eleven years. In this way it seeks to ensure that the industrial development process meets the highest possible degree of environmental sustainability. Energy access is one of the most pressing of all the global challenges and is central to all the three dimensions of sustainable development. UNIDO has played a leading role in the development of the Sustainable Energy for All (SE4All) initiative launched by the Secretary-General of the United Nations, which has drawn up three interlinked and complementary global goals to be achieved by 2030: i) ensure universal access to modern energy services; ii) double the rate of improvement in energy efficiency; iii) double the share of renewable energy in the global energy mix. Though ambitious, these goals are achievable with the right mix of policy incentives, public finance and private capital. So far over 50 countries are supporting the SE4All initiative, which has also attracted a significant element of private sector partnership. The Director-General of UNIDO was initially appointed as the co-chair of the High-level Group established by the Secretary-General to oversee the SE4All initiative, and subsequently its chief executive. UNIDO s Green Industry initiative assists the greening of existing industries by promoting a continuous increase in their resource productivity and environmental performance, as well as the establishment of specialized green industries that deliver environmental goods and services. During the Rio+20 Conference, UNIDO and the United Nations Environment Programme (UNEP) launched the Green Industry Platform - a global high-level multistakeholder partnership intended to act as a forum for catalyzing, mobilizing and mainstreaming action on Green Industry around the world. By encouraging the more efficient use of energy and raw materials in manufacturing processes and services, the Platform will contribute both to cleaner and more competitive industrial development, and will help reduce pollution and reliance on unsustainable use of natural resources. Together with UNEP, UNIDO has also supported a global programme of National Cleaner Production Centres, and in October 2011 launched the joint UNIDO-UNEP Programme on Resource Efficient and Cleaner Production (RECP) to enhance the effectiveness of these centres through improved networking and knowledge management among the centres themselves and with other institutions that deliver resource efficient and cleaner production.

12 UNIDO believes fervently in the value of regional programmes: the GEF Strategic Programme for West Africa (SPWA) Energy Component is one such example. It utilizes a programmatic umbrella approach at the regional level that transforms global and regional goals and commitments into concrete action in the field of sustainable energy in the sixteen countries of the Economic Community of West African States (ECOWAS): Benin, Burkina Faso, Burundi, Cape Verde, Chad, Cote d Ivoire, Ghana, Guinea, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone, The Gambia, and Togo. The Regional Project, which is being implemented by UNIDO in cooperation with the ECOWAS Centre for Renewable Energy and Energy Efficiency (ECREEE), seeks to create an enabling policy and institutional environment for coordination, coherence, integration and knowledge management within concrete energy projects at the country level, and strives to promote renewable energy and energy efficient technologies and markets in the West African Region.

13 HONDURAS: As part of a wider UN programme for universal water and sanitation access, UNIDO is assisting companies in preparing sustainable long-term business strategies to reduce water contamination and increase the economic performance of the companies through the transfer of environmentally-sound technologies.

14 COOPERATION BETWEEN UNIDO AND THE EUROPEAN UNION (EU): A PARTNERSHIP FOR INCLUSIVE GROWTH AND SUSTAINABLE DEVELOPMENT Since 2005, UNIDO has enjoyed a growing partnership with the EU, primarily in UNIDO s focus areas of trade capacitybuilding and poverty reduction through productive activities. The new EU communication on Increasing the impact of EU Development Policy: An agenda for change creates an excellent basis for further developing this partnership in a broader range of areas including private sector development, industrial policies, food security and energy.

15 In carrying out the core requirements of its mandate and mission, UNIDO has more than doubled its technical cooperation delivery over the past ten years. At the same time, it has also substantially increased its mobilization of financial resources, testifying to the growing international recognition of the Organization as an effective provider of inclusive and sustainable industrial development services. The fact that this increase in its services has been accomplished with virtually stable staff levels und an essentially unchanged regular budget for much of the past fifteen years underlines the increasing efficiency and productivity of the Organization.

16 UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Vienna International Centre, P.O. Box 300, 1400 Vienna, Austria Telephone: (+43-1) , Fax: (+43-1) Internet:

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