1. Green economy strategies and implementation plan in developing countries: The case of Ethiopia Alemu Mekonnen Department of Economics at Addis Ababa University and EfD Ethiopia at Ethiopian Development Research Institute Prepared for Development Talks on “After Rio+20: Next steps towards inclusive green growth”, organized by Sida 17 September 2012, Stockholm

2. Introduction Ethiopia one of the three fastest growing economies in Africa recently (AfDB 2012) Annual growth 11-14.9% until 2015 (Ethiopia’s Growth and Transformation Plan (GTP) 2010/11- 2014/15) => May not be sustainable if environmental and social issues not addressed

3. Ethiopia active on climate change – Involvement in global climate negotiations and committees – Plans/programs/documents at national level: 1 st National Communications, NAPA, NAMA – Green economy (GE) strategy launched in 2011 - part of Climate Resilient Green Economy strategy

4. GE strategy process Preparation of GE Strategy started in 2010; help from international & national consultants Inter-ministerial committee provided guidance to a technical committee (7 sub-technical committees) +20 government institutions represented, +50 experts 7 sectors selected: power, buildings & cities, forestry, agric. /soil based emissions, livestock, transport & industry

5. GE strategy process (2) 60 prioritized GE initiatives Prioritization Criteria : – relevance, feasibility for local implementation; – contribution to reach targets of GTP; – abatement potential at reasonable cost for the respective sectors Regional, sectoral consultations; Structure of permanent institutional setup

6. GE strategy based on 4 pillars: 1.Improved crop and livestock production, and reduced emissions 2.Protect & re-establish forests 3.Expand electricity generation from renewables 4.Leapfrog to modern, energy-efficient technologies in transport, industry & buildings

7. The work done  Identification of current & projected GHG emissions under business as usual (BAU) scenarios until 2030,  Identification of drivers and abatement levers in the 7 sectors,  Estimation of mitigation costs, identification of financial needs and ways of financing these,  The way forward

8. Projections: Sectoral shares (%) Sector20102025 Agriculture4229 Industry1332 Services4539

9. Rapid increase in GHG emissions - if nothing done

11. Sectoral distribution (Mt of CO 2 e)

13. SectorMain abatement measures ForestryImproved stoves (Fuel wood, LPG, biogas, electric), sustainable forest management, Reduced Emissions from Deforestation and forest Degradation (REDD) AgricultureLivestock: Value chain efficiency, diversification of animal mix, mechanization and pastureland improvement Crops: low emitting and yield increasing techniques and irrigation IndustryBiomass (agri-residues), energy efficient equipment, waste heat recovery TransportElectric rail, fuel efficiency standards, hybrid and electric vehicles; mixing ethanol and biodiesel BuildingsHigh-efficiency lighting, landfill gas management; improved liquid waste management PowerClean power production and export

14. Costs and financing Abatement costs: – For over 80% of the abatement potential, less than 15 USD per t of CO 2 e – Total cost of building a green economy during 2010-2030 =150 billion USD Some of these costs could be financed through climate finance Funding sources: own initiatives, supported initiatives, market-based initiatives

15. Co-benefits of strategy: – Public health: reduced indoor and outdoor air pollution; improved water quality – Rural development: improved soil fertility, food security – Reduced reliance on imported fossil fuels

16. Implementation plan Overall responsibility given to Ethiopia’s Environmental Council Govern CRGE initiative under co-responsibility of EPA and Min. of Finance and Econ. Devt. Use existing institutions whenever possible Stakeholder consultation key to awareness creation, feedback & proper implementation

17. Next steps 1.Include GE strategy in sectoral development plans 2.Identify and select priority initiatives 3.Prepare implementation, resource, and investment plans

18. 4 initiatives selected for fast-track implementation: 1.Exploit vast hydropower potential; 2.Promote improved rural cooking technologies; 3.Improve livestock value chain; 4.Reduce Emissions from Deforestation and forest Degradation (REDD).

19. Examples of actual projects being implemented: Grand renaissance dam on the Blue Nile - 6000 MW gen. capacity, mainly financed domestically (bonds, donations)

20. Wind energy, pilot production through connection to the grid

21. Humbo afforestation/reforestation project: first CDM project in Ethiopia (covering 2,728 ha)

22. Some more examples Construction of infrastructure for light rail network started in Addis Ababa Derba cement factory (climate finance for cleaner technology) Blending of ethanol with gasoline Ethanol cook stoves to households

23. Concluding remarks Adaptation to local context: countries need to prepare their own GE strategies; identify synergies and trade-off Green investment/technologies important vehicles to build green economy Public-private partnership opportunities Political commitment important

24. Concluding remarks (2) Government needs to create enabling environment (provide incentives + appropriate institutional arrangements) North-South compensation on global env. problems (adaptation, mitigation etc. on principle of common but differentiated responsibilities)

25. Concluding remarks (3) Need for research & learning Costs and benefits of strategies and policies should be assessed Capacity strengthening needed: human resources, financial

26. Comments are very welcome Thank you E-mail: alemu_m2004@yahoo.com