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The closest look yet at Chinese economic engagement in Africa
Field interviews with more than 1,000 Chinese companies provide new insights into Africa–China business relationships.
In two decades, China has become Africa’s most important economic partner. Across trade, investment, infrastructure financing, and aid, no other country has such depth and breadth of engagement in Africa. Chinese “dragons”—firms of all sizes and sectors—are bringing capital investment, management know-how, and entrepreneurial energy to every corner of the continent. In doing so they are helping to accelerate the progress of Africa’s economies.
Yet to date it has been challenging to understand the true extent of the Africa–China economic relationship due to a paucity of data. Our new report, Dance of the lions and dragons: How are Africa and China engaging, and how will the partnership evolve?, provides a comprehensive, fact-based picture of the Africa–China economic relationship based on a new large-scale data set. This includes on-site interviews with more than 100 senior African business and government leaders, as well as the owners or managers of more than 1,000 Chinese firms spread across eight African countries1that together make up approximately two-thirds of sub-Saharan Africa’s GDP.
Africa’s largest economic partner
In the past two decades, China has catapulted from being a relatively small investor in the continent to becoming Africa’s largest economic partner. And since the turn of the millennium, Africa–China trade has been growing at approximately 20 percent per year. Foreign direct investment has grown even faster over the past decade, with a breakneck annual growth rate of 40 percent.2Yet even this number understates the true picture: we found that China’s financial flows to Africa are around 15 percent larger than official figures when nontraditional flows are included. China is also a large and fast-growing source of aid and the largest source of construction financing; these contributions have supported many of Africa’s most ambitious infrastructure developments in recent years.
We evaluated Africa’s economic partnerships with the rest of the world across five dimensions: trade, investment stock, investment growth, infrastructure financing, and aid. China is among the top four partners for Africa across all these dimensions (Exhibit 1). No other country matches this depth and breadth of engagement.
Chinese firms in Africa
Behind these macro numbers are thousands of previously uncounted Chinese firms operating across Africa. In the eight African countries on which we focused, the number of Chinese-owned firms we identified was between two and nine times the number registered by China’s Ministry of Commerce, until now the largest database of Chinese firms in Africa. Extrapolated across the continent, our findings suggest there are more than 10,000 Chinese-owned firms operating in Africa today (Exhibit 2).
Around 90 percent of these firms are privately owned—calling into question the notion of a monolithic, state-coordinated investment drive by “China, Inc.” Although state-owned enterprises tend to be bigger, particularly in specific sectors such as energy and infrastructure, the sheer number of private Chinese firms working toward their own profit motives suggests that Chinese investment in Africa is a more market-driven phenomenon than is commonly understood.
Chinese firms operate across many sectors of the African economy. Nearly a third are involved in manufacturing, a quarter in services, and around a fifth each in trade and in construction and real estate. In manufacturing, we estimate that 12 percent of Africa’s industrial production—valued at some $500 billion a year in total—is already handled by Chinese firms. In infrastructure, Chinese firms’ dominance is even more pronounced, and they claim nearly 50 percent of Africa’s internationally contracted construction market.
The Chinese firms we talked to are mostly profitable. Nearly one-third reported 2015 profit margins of more than 20 percent. They are also agile and quick to adapt to new opportunities. Except in a few countries such as Ethiopia, they are primarily focused on serving the needs of Africa’s fast-growing markets rather than on exports. An overwhelming 74 percent said they feel optimistic about the future. Reflecting this, most Chinese firms have made investments that represent a long-term commitment to Africa rather than trading or contracting activities.
Impact in African economies
At the Chinese companies we talked to, 89 percent of employees were African, adding up to nearly 300,000 jobs for African workers. Scaled up across all 10,000 Chinese firms in Africa, this suggests that Chinese-owned business employ several million Africans. Moreover, nearly two-thirds of Chinese employers provided some kind of skills training. In companies engaged in construction and manufacturing, where skilled labor is a necessity, half offer apprenticeship training.
Half of Chinese firms had introduced a new product or service to the local market, and one-third had introduced a new technology. In some cases, Chinese firms had lowered prices for existing products and services by as much as 40 percent through improved technology and efficiencies of scale. African government officials overseeing infrastructure development for their countries cited Chinese firms’ efficient cost structures and speedy delivery as major value adds.
On balance, we believe that China’s growing involvement is strongly positive for Africa’s economies, governments, and workers. However, there are areas for significant improvement:
By value, only 47 percent of the Chinese firms’ sourcing was from local African firms, representing a lost opportunity for local firms to benefit from Chinese investment.
Only 44 percent of local managers at the Chinese-owned companies we surveyed were African, though some Chinese firms have driven their local managerial employment above 80 percent (Exhibit 3). Other firms could follow suit.
There have been instances of labor and environmental violations by Chinese-owned businesses. These range from inhumane working conditions to illegal extraction of natural resources including timber and fish.
Differences in country engagement
At a national level, we focused on eight large African economies, and identified the following four distinct archetypes of the Africa–China partnership:
Robust partners. Ethiopia and South Africa have a clear strategic posture toward China, along with a high degree of economic engagement in the form of investment, trade, loans, and aid. For example, both countries have translated their national economic-development strategies into specific initiatives related to China, and they have also developed important relationships with Chinese provinces and with Beijing. As a result, China sees these African countries as true partners: reliably engaged and strategic for China’s economic and political interests. These countries have also created a strong platform for continued Chinese engagement through prominent participation in such forums as the Belt and Road initiative (previously known as One Belt, One Road), and they can therefore expect to see ongoing rapid growth in Chinese investment.
Solid partners. Kenya, Nigeria, and Tanzania do not yet have the same level of engagement with China as Ethiopia and South Africa, but government relations and Chinese business and investment activity are meaningful and growing. These three governments recognize China’s importance, but they have yet to translate this recognition into an explicit China strategy. Each has several hundred Chinese firms across a diverse set of sectors, but this presence has largely been the result of a passive posture relying on large markets or historical ties; much more is possible with true strategic engagement.
Unbalanced partners. In the case of Angola and Zambia, the engagement with China has been quite narrowly focused. For Angola, the government has supplied oil to China in exchange for Chinese financing and construction of major infrastructure projects—but market-driven private investment by Chinese firms has been limited compared with other African countries; only 70 to 75 percent of the Chinese companies in Angola are private, compared with around 90 percent in other countries. Zambia’s case is the opposite: there has been major private-sector investment but not enough oversight from regulatory authorities to avoid labor and corruption scandals.
Nascent partners. Côte d’Ivoire is at the very beginning of developing a partnership with China, and so the partnership model has yet to become clear. The country’s relatively small number of Chinese investors are focused on low-commitment industries such as trade.
The next decade
We interviewed more than 100 senior African business and government leaders, and nearly all of them said the Africa–China opportunity is larger than that presented by any other foreign partner—including Brazil, the European Union, India, the United Kingdom, and the United States.
But exactly how quickly will the Africa–China relationship grow in the decade ahead? We see two potential scenarios. In the first, the revenues of Chinese firms in Africa grow at a healthy clip to reach around $250 billion in 2025, from $180 billion today. This scenario would simply entail business as usual, with Chinese firms growing in line with the market, holding their current market shares steady as the African economy expands. Under this scenario, the same three industries that dominate Chinese business in Africa today—manufacturing, resources, and infrastructure—would dominate in 2025 as well.
We believe much more is possible: in a second scenario, Chinese firms in Africa could dramatically accelerate their growth. By expanding aggressively in both existing and new sectors, these firms could reach revenues of $440 billion in 2025. In this accelerated-growth scenario, not only do the three established industries of Chinese investment grow faster than the economy, but Chinese firms also make significant forays into five new sectors: agriculture, banking and insurance, housing, information communications technology and telecommunications, and transport and logistics. This expansion could start with Chinese firms moving into sectors related to the ones they currently dominate—for example, from construction into real estate and housing. Another part of this accelerated growth could come from Chinese firms more fully applying their formulas that have proved successful in China to markets in Africa, including business models in consumer technology, agriculture, and digital finance.
There is considerable upside for Africa if Chinese investment and business activity accelerate. At the macroeconomic level, African economies could gain greater capital investment to boost productivity, competitiveness, and technological readiness, and tens of millions more African workers could gain stable employment. At the microeconomic level, however, there will be winners and losers. Particularly in sectors such as manufacturing, where African firms are significantly lagging behind global productivity levels, African incumbents will need to dramatically improve their productivity and efficiency to compete—or partner effectively—with new Chinese companies on their turf.
With continued and likely growing Chinese investment, it will become ever more urgent to address the gaps in the Africa–China partnership, including by strengthening the role of African managers and partners in the growth of Chinese-owned businesses. Moreover, both Chinese and African actors will need to address three major pain points: corruption in some countries, concerns about personal safety, and language and cultural barriers. In five of the eight countries in which we conducted fieldwork, 60 to 87 percent of Chinese firms said they paid a “tip” or bribe to obtain a license. After corruption, the second-largest concern among Chinese firms is personal safety. For their part, our African interviewees described language and cultural barriers that lead to misunderstanding and ignorance of local regulations. If these problems are left unaddressed, the misunderstandings and potentially serious long-term social issues could weaken the overall sustainability of the Africa–China relationship.
Everyone—African or Chinese, government or private sector—has a role to play in realizing the promise of the Africa–China partnership. We suggest ten recommendations, consisting of actions to be taken by African and Chinese businesses and governments, to ensure the Africa–China relationship grows sustainably and delivers strong economic and social outcomes (Exhibit 4).
Download Dance of the lions and dragons: How are Africa and China engaging, and how will the partnership evolve? ,the full report on which this article is based—available in both English (PDF–3MB) and Chinese (PDF–5MB).
About the author(s)
Kartik Jayaram is a senior partner in McKinsey’s Nairobi office, where Omid Kassiri is a partner; Irene Yuan Sun is a consultant in the Washington, DC, office.
Accelerating Women's Economic Empowerment
- A recent panel of finance ministers and Chief Executive Officers called for tangible and country-level action for women’s economic empowerment
- Equal access to financial services, helping women build assets and professionalizing the care-giving sector can help accelerate progress in women’s economic empowerment
- The flagship event helped share recommendations from the UN Secretary-General’s High-Level Panel on Women’s Economic Empowerment (HLP) report with delegations attending the 2017 WBG – IMF Spring Meetings
WASHINGTON, June 26, 2017 – Providing equal access to financial services, helping give women more power over income and assets like land and technology, and professionalizing the care-giving sector can help accelerate progress in women’s economic empowerment, especially in developing countries. But how should countries get it done?
These and other practical questions were addressed by World Bank Group President Jim Yong Kim, UN Executive Director Phumzile Mlambo-Ngcuka, finance ministers and CEOs during the WBG-IMF Spring Meetings flagship event on Boosting Women’s Economic Empowerment. The speakers called for finance ministers to join with the private sector and others who want to take action to expand economic opportunities for women, which is key to helping countries reach their full economic potential.
Through its operational work on the ground and high level dialogue at venues such as the WBG-IMF Spring Meetings, the WBG aims to catalyze action and work side by side with governments, companies and other partners to close remaining gaps in access to education and maternal health in those countries where those gaps persist, while also accelerating efforts to enhance women’s economic opportunity: more and better jobs, ownership and control of productive assets like land and housing, access to finance, technology and insurance services, and increased capacity and opportunity to act independently at home, in the community and in various levels of government.
However much work still lies ahead if the world is to achieve gender equality by 2030 - Sustainable Development Goal (SDG) 5 and related targets. In particular, women’s economic opportunity lags that of men in every country of the world, at a cost to individuals, families, communities and economies.
The speakers discussed various aspects of this challenge, including how to help women access financial solutions. In opening remarks, WBG President Jim Yong Kim said, “We’ve known for a long time that access to financial services can be a powerful driver to help people lift themselves out of poverty. With a concerted push from governments, the private sector, and multilateral institutions including the World Bank Group, we believe we can close this gap.” Kim offered examples of WBG efforts, including doubling the amount of money its Banking on Women program lends to women entrepreneurs from $1 billion to $2 billion and the WBG’s testing of innovations to find alternatives to collateral requirements at commercial banks.
Sigve Brekke, president and CEO of Telenor Group, one of the world’s largest telecommunications companies, said they are providing access to financial tools for communities in emerging markets in Asia. “In a country like Myanmar for example, you know less than 10% of the female population have a bank account,” he said. “Our objective then is to include them all in the banking sector by providing them with a digital banking solution. This is a tool to grow their economies, and make sure that females are also included in the financial sector.”
Simona Scarpaleggia, CEO of IKEA Switzerland, added that one way governments can work toward supporting women entering the workforce or owning assets is by changing laws that discriminate against women and addressing social norms that influence those laws. Scarpaleggia co-chaired the UN Secretary General High Level Panel (HLP) on Women’s Economic Empowerment, which issued two reports focusing on transformative policies and actions that governments, the private sector, and civil society can take to advance women’s economic empowerment. The proposed policies were chosen based on seven priorities identified in the HLP’s first report, Leave No One Behind: A Call to Action for Gender Equality and Women’s Economic Empowerment, which presented evidence to support the case for addressing systemic constraints to economic opportunity for women. The reports summarize information from a range of sources, including Women Business and the Law, which found that nearly 190 countries have discriminatory laws that impede women’s employment and entrepreneurship.
Finance minister of Indonesia Sri Mulyani Indrawati illustrated Scarpaleggia’s point, saying she revised income tax laws in Indonesia to allow women to file taxes separately from their husbands for the first time. “When you can file taxes independently, this means that you have your own assets and you are going to be able to access banking and finance,” said Indrawati, who also served as World Bank Group managing director and COO from 2010-2016.
Bill Morneau, Canada’s minister of finance, offered another example of what government leaders can do to reach larger scale solutions, having instituted a requirement that each government ministry must look at their budgets and analyze the impact on advancing gender equity in the workplace before he will consider their proposals. “We believe that getting to gender equity, empowering women is one of the central features of what we’re trying to achieve,” Morneau said. “We start with the idea that we need to look at our budget as a vehicle for making a difference.”
Scarpaleggia added insight on specific actions companies and institutions can take, citing her company IKEA Switzerland’s having already achieved gender parity. She said it took making gender equality an explicit corporate value, strong and committed leadership, willingness to look for and then acknowledge gaps between stated corporate values and actual behavior, and making a conscious decision to change. Once the decision was made, the company focused on building awareness and socializing the idea among staff internally to help overcome initial resistance, which usually accompanies such a big change, she added. “We changed our internal processes to ensure they were gender neutral. We worked on unconscious biases. We set goals. We committed on the occasion of the HLP to reach gender parity throughout all our units in the world by 2020. It takes work, and leadership plays an important role. But it IS possible.”
Echoing efforts by the other speakers, Brekke said Telenor is also working towards gender balance within the company by meeting targets in top management positions. While empowering women economically is good for families, communities and countries, Brekke noted that gender equity is also good business.
“It’s good business because we need to represent our customers, and we see that a much better balance between genders creates innovation, creates better services, creates better products,” Brekke said. “That’s why it’s so important to set these targets and not only talk about it, but actually do something with it in practice.”
President Kim, who became the first UN HeforShe Thematic Champion of an international financial institution - committing to close the gender gap within senior management by 2020 - highlighted unpaid work, such as care-giving for children and elderly family members, as a critical impediment to women’s economic opportunity. “We must redistribute care work,” said Kim. “It too often remains the sole domain of women and that has got to change.”
WBG Senior Director for Gender Caren Grown added in a follow up interview that “care needs to be seen as a public good. It produces the next generation of workers, it has important development effects for children, and is an important sector of employment for women and men. Solving this will need both public and private sector support and financing.”
That sentiment was shared by Mlambo-Ngcuka, who said, “Unless the private sector and public sector make this private issue a public one, many women might never work.”
Turning the Climate Tide by 2020
The world needs high-speed climate action for an immediate bending-down of the global greenhouse-gas emissions curve, leading experts caution. Aggressive reduction of fossil-fuel usage is the key to averting devastating heat extremes and unmanageable sea level rise, the authors argue in a comment published in the renowned scientific journal Nature this week. In the run-up to the G20 summit of the planet’s leading economies, the article sets six milestones for a clean industrial revolution. This call for strong short-term measures complements the longer-term 'carbon law' approach introduced earlier this year by some of the current co-authors, including the Potsdam Institute’s Director Hans Joachim Schellnhuber, in the equally eminent journal Science. Thus a full narrative of deep decarbonization emerges.
“We stand at the doorway of being able to bend the GHG emissions curve downwards by 2020, as science demands, in protection of the UN Sustainable Development Goals, and in particular the eradication of extreme poverty," Christiana Figueres says, lead-author of the Nature comment and former head of the United Nations Framework Convention on Climate Change (UNFCCC). "This monumental challenge coincides with an unprecedented openness to self-challenge on the part of sub-national governments inside the US, governments at all levels outside the US, and of the private sector in general. The opportunity given to us over the next three years is unique in history.” Figueres is the convener of Mission 2020, a broad-based campaign calling for urgent action now to make sure that carbon emissions begin an inexorable fall by 2020.
The authors and co-signatories to the Nature article comprise over 60 scientists, business and policy leaders, economists, analysts and influencers, including Gail Whiteman from Lancaster University; Sharan Burrow, General Secretary of the International Trade Union Confederation; Paul Polman, Chief Executive Officer of Unilever plc; Anthony Hobley, Chief Executive of Carbon Tracker; Christian Rynning-Tønnesen, CEO of Statkraft; and Jonathan Bamber, President of the European Geosciences Union.
The great sustainability transformation
The authors are confident that both technological progress and political momentum have reached a point now that allows to kick-start the 'great sustainability transformation'. 2020 is crucial, because in that year the US will be legally able to withdraw from the Paris Agreement. Even more compelling are the physics-based considerations, however: Recent research has demonstrated that keeping global warming below 2 degrees Celsius becomes almost infeasible if we delay climate action beyond 2020. And breaching the 2°C-line would be dangerous, since a number of Earth system tipping elements, such as the great ice sheets, may get destabilized in that hot-house.
“We have been blessed by a remarkably resilient planet over the past 100 years, able to absorb most of our climate abuse,” says Johan Rockström from the Stockholm Resilience Centre, co-author of the Nature comment and lead-author of the Science article. “Now we have reached the end of this era, and need to bend the global curve of emissions immediately, to avoid unmanageable outcomes for our modern world.”
Six milestones for 2020
Indeed, a social tipping point for the better is in sight, the experts show. Power generation from wind and solar is booming already. In Europe, for instance, more than three quarters of new energy capacities installed rely on those renewable sources. China is quickly establishing a national emissions trading scheme. Financial investors such as BlackRock in the US are growing wary of carbon risks.
The six milestones for 2020 as defined in the article reach from energy (pushing renewables to 30% of total energy supply and retiring all coal-fired power plants) to transport (electric vehicles making up 15% of new car sales globally, up from roughly 1% today) and finance (mobilize 1 trillion US dollars a year for climate action).
"The climate math is brutally clear: While the world can't be healed within the next few years, it may be fatally wounded by negligence until 2020," concludes Hans Joachim Schellnhuber from the Potsdam Institute for Climate Impact Research, co-author of both the Nature comment and the Science article. Action by 2020 is necessary, but clearly not sufficient – it needs to set the course for halving CO2 emissions every other decade. In analogy to the legendary Moore’s Law, which states that computer processors double in power about every two years, the 'carbon law' can become a self-fulfilling prophecy mobilizing innovations and market forces, says Schellnhuber. “This will be unstoppable – yet only if we propel the world into action now.”
Article: Christiana Figueres, Hans Joachim Schellnhuber, Gail Whiteman, Johan Rockström, Anthony Hobley, Stefan Rahmstorf (2017): Three years to safeguard our climate. Nature [DOI: 10.1038/546593a]
Photo credit: Reuben Wu
Mobilising private financing for manufacturing in sub-Saharan Africa
Since the downturn in global commodity prices in 2015, sub-Saharan African macroeconomic conditions have deteriorated, and 2016 saw the slowest economic growth in more than two decades. To maintain progress in economic transformation, employment-intensive and higher-productivity sectors need to be developed. Manufacturing – including agricultural processing – offers this opportunity, including through participation in regional and global value chains. However, beyond the challenge of macroeconomic stability, discussed in this paper's companion paper, this requires the mobilisation of significant private finance for investment in the sector.
To date, mobilising of finance has been muted and, at current levels, is not strong enought to support growth in the manufacturing sector. Furthermore, the finance that has been mobilised has been concentrated in very few countries. This paper explores how sub-Saharan African economies seeking to attract finance face not only economic constraints, but firm-level ones that are hindering investors' efforts. It goes on to suggest that only by robustly tackling those firm-level constraints, will finance be effectively mobilised on the scale required to drive economic transformation.
World Bank at DRC Mining Week: "pre-competitive geoscience knowledge essential to attract investor interest"
"There is a need to have access to pre-competitive geoscience knowledge and geological mapping suitable to identify prospective areas for attracting investor interest", says Francisco Igualada, Senior Mining Specialist, Energy and Extractive Industries (GEEDR) at the World Bank. He adds: "this is very important as many junior and mid-tier mining companies are unaware of the full mineral prospecting potential of a country, as a result of incomplete coverage of geological mapping, at the required scale, and associated geochemical and geophysical surveys."
Mr Igualada is a featured speaker at DRC Mining Week in Lubumbashi from 23-24 June, focusing on the "Importance of geoscience data and information to ensure a sustainable DRC mining sector".
He explains further: "In DRC, thanks to the development of the PROMINES project, we are undertaking such a fundamental geological work. Of course, there are other challenging issues such as the availability of a digital mining cadastre that we have tackled as well through the development of the World Bank PROMINES project. Currently we are extending the DRC cadastre (CAMI) to other regions bringing more transparency and the principle of ‘first come first served’. This aspect, coupled with the Mining Code, is a key factor for effectively attracting investors, besides the DRC’s great geological and metallogenical potential."
The full interview with Mr Igualada can be viewed here: http://www.drcminingweek.com/WorldBankDRCinterview
Thousands are expected to gather for the practical annual mining and industrial expo again as the award-winning DRC Mining Week conference and exhibition returns to Lubumbashi, in the heart of the DRC’s mining hub, from 23-24 June. While retaining its main focus on mining, the event will also broaden its scope to include a focus on related and complementary sectors such as agriculture, energy and construction.
Industry recognition and support
As with previous editions of the event, DRC Mining Week has already secured the early and impressive support of the industry through the diamond sponsorship of Engen and the platinum sponsorships of Gecotrans, Sodexo, Standard Bank and Tenke Fungurume Mining, while Aggreko, Atlas Copco, Axishouse, Copperbelt Energy, Earth Networks, ERG, Ivanhoe Mines-New Horizons and Vodacom are confirmed as gold sponsors.
Earlier this year, DRC Mining Week was recognised for its support of the Kinsevere Community School Project in Lubumbashi when it was named a finalist in the Social Responsibility category of the AAXO ROAR Organiser and Exhibitor Awards, which honour excellence in the exhibition and events industry on the continent.
DRC Mining Week is organised by Spintelligent, a leading Cape Town-based organiser of exhibitions and conferences across the continent in the infrastructure, real estate, energy, mining, agriculture and education sectors. Other well-known events by Spintelligent include African Utility Week, Agritech Expo Zambia, Kenya Mining Forum, Future Energy East Africa (formerly EAPIC), Future Energy Nigeria (formerly WAPIC), Future Energy Central Africa (formerly iPAD Cameroon), iPAD Nigeria Mining Forum and EduWeek. Spintelligent is part of the UK-based Clarion Events Group.
DRC Mining Week:
Pre-conference Power Focus Day: 22 June 2017
Conference and expo: 23-24 June 2017
Site visit: 22 June 2017
Location: The Pullman Lubumbashi Grand Karavia Hotel, Lubumbashi, DRC
World Economic Forum to Support 22 Countries and EU in Doubling Investment in Clean Energy R&D by 2021
World Economic Forum to work with Mission Innovation, a commitment by 22 countries and the European Union, to accelerate global clean energy innovation to address climate change
Collaboration aims to support Mission Innovation by enabling public-private partnerships that enable a more sustainable, affordable, inclusive and secure global energy future
Mission Innovation includes the world’s leading economies, five most populous countries and represents over 80% of clean energy R&D budgets – members pledged to double governmental investments in R&D by 2021
Beijing, China, 08 June 2017 – The World Economic Forum and Mission Innovation, a commitment by 22 governments and the European Union to accelerate global clean energy innovation, will collaborate to support Mission Innovation’s goal of doubling governmental investments in clean energy R&D by 2021.
The aim of the collaboration is to encourage public-private partnerships which will have the greatest impact on three areas of investment – or Innovation Challenges – carbon capture; clean energy materials; and affordable heating and cooling of buildings. The Forum will support by driving engagement from industry, investors and its network of Technology Pioneers, a global community of trailblazing companies, to reduce the costs of low carbon energy solutions, making them widely available, affordable and reliable.
“Public-private partnerships are critical to fast-track innovation from early stage design to full scale-up. This is a critical time for energy innovation and we are delighted to be working with major governments in the quest to accelerate access to clean energy for everyone,” said Cheryl Martin, Head of Industries, Member of the Managing Board, World Economic Forum Geneva.
“This partnership allows us to make the most of the clean energy momentum that Mission Innovation has created and collectively enable those participating to reach our aim of accelerating energy innovation in the private sector – which is at the heart of economic growth for many of the countries behind this,” saidLeonardo Beltrán Rodríguez, Mexico’s Deputy Secretary for Planning and Energy Transition.
Mission Innovation includes the world’s five most populous countries (Brazil, China, India, Indonesia, and the United States) and represents over 75% of global CO2 emissions from electricity and more than 80% of clean energy R&D budgets. Mission Innovation member governments have pledged to double R&D investment to reach over $30 billion a year by 2021. Details of each country’s plans are available here.
The announcement was made as ministers from all 22 member countries gathered in Beijing at theSecond Mission Innovation Ministerial and Eighth Clean Energy Ministerial.
Mission Innovation will convene energy innovation stakeholders at the World Economic Forum’s Annual Meeting of the New Champions 2017, taking place in Dalian, People’s Republic of China, 27-29 June. They will also meet at the Strategic Dialogues on Energy Futures event, hosted by Mexico, on 12-13 September 2017.