G20 China 2016.

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“Fossil fuel” is drying up and “Global warming” could be solved in the future.

What is Emulsion Fuel in New Generation, Paid Attention in the World?

It’s

no exaggeration to say that the economy and the life of the people in developed countries depends heavily on fossil fuels, especially such as oil. Fossil fuel is a limited resource which has been made for a long time but, is going to dry up in less than 50 years. However, the consumption has been increasing each year and the consumption in developing countries is also growing rapidly in order to build up increasing economies. The risk of fuel drying up is a serious issue in the world. Therefore, people should pay more attention to the emulsion fuel called “Water down fuel”. This is emulsion fuel mixed with water and oil such as heavy oil, coal oil or light oil.

The main reason this emulsion fuel is getting attention, is not only for this issue, because this fuel is ecological for the global environment as well. “Global warming” is certainly a serious issue for every country. The CO2 deficit-cutting plan was discussed seriously at COP21 in Paris, 2015. This emulsion fuel will contribute to the CO2 deficit-cutting plan.

Our emulsion fuel has cleared 3 issues and has a 70% rate of water. Emulsion fuel got attention about 20 years ago but it was not practical and disappeared with many issues. Former emulsion fuels had 3 issues, “Water and oil separate in short time”, “It powered down by adding water” and “Viscosity of surfactant as solvent caused failure machines”.

Eneco Holdings has cleared these issues and is focused on emulsion fuel again. “Eneco PLASMA FUSION” is their technology. The rate of water of former emulsion fuel was from 5% to 15% but this emulsion fuel has a very high rate of water, which water is 70% and oil is 30%. Besides, it doesn’t make machines power down so we are able to use resource as about triple times.

Mr Yamamoto says “We had to mix water with oil as high density to clear these 3 issues. We raised the quality of the passage of electric current by changing water into hydrogen ion and oil into carbon ion. We also improved the quality of surfactant so the additive of our emulsion fuel is less than 0.5%. We delicately adjusted the timing of mixing and set temperature and pressure same condition. When we completely matched coefficient of thermal expansion, we completely mixed water with oil.”

We have succeeded to make an emulsion

fuel with water from water pipes or wells as heavy oil, light oil, coal oil and biodiesel.

Mr Yamamoto says “Japan is a small island country but we discharge much CO2 so we have been thinking that we have to sort out this problem initiatively. We are expecting that we are able to cut CO2 more than 50% by using this emulsion fuel. SOx and NOx are able to be cut from 20% to 70% as well.”

Starting from Asia the world is in progress to transfer to emulsion fuel. Emulsion fuel is able to be made by mixing water with any fossil oil such as light oil, coal oil, heavy oil or biodiesel. We are able to use these emulsion fuel for industrial burner, boiler, generator or marine vessel.

They provide a refinery producing 500 litres an hour. Emulsion fuel is refined automatically through the refiner when you turn on the switch. You are able to cut the cost as about 40% and create even more ecological fuel.

Electric outage is always happening for fuel shortage in Southeast Asian countries. They have electric outages two or three times in a day. If they have fuel with a rate of water at 70%, they easily get three times more fuel

than from former fossil fuel. Eneco Holdings has already got a contract with the government or companies of Bangladesh (Government), Myanma, Indonesia, Mongolia, Thai, Spain, Korea and China.

When we adopt new energy, we usually need big integrated network infrastructure for the side of machines as well. However, we are able to use emulsion fuel instead of former fossil fuel so we are able to keep the initial cost low.

The future of the emulsion fuel Eneco Holdings is going to sign a contract with SAC Securities and list stocks in Singapore. Distribution to the world is developed in Singapore so they are going to build the factory having refiners to produce emulsion fuel and spread their emulsion fuel to all over the world.

They have already created high quality emulsion fuel whose the rate of water is 87.5% now. They have been planning to create the fuel whose the rate of water is 100% by adding only additives in the future. The consumption of energy in the world is continually growing up so we must use limited fuel effectively. Emulsion fuel is expected to be used instead of all fossil fuel in the future. ■

WE HAVE SUCCEEDED TO MAKE AN EMULSION FUEL IN WHICH THE RATE OF WATER FROM WATER PIPES OR WELLS IS MORE THAN 50% AS HEAVY OIL, LIGHT OIL, COAL OIL AND BIODIESEL.

38 World Chambers Congress: Opportunities, Innovation Combatting Global Climate Change

By Dr Werner Brandt Moving the Global Climate Sustainability Agenda Forward Through G20 Peder Holk Nielsen

50 / Human Bionics Interface: Australia’s G20 Inspired Alliance Accelerating New Global Partnerships Robyn Stokes / Unlocking SME Potential for Inclusive Economic Growth Dr. Tunc Uyanik

56 / The New Dimensions for the Great Silk Road Dr Oleg Preksin

70 / Russia and China Join Forces to Develop Green Energy Alexey Lossan

72 / Physical and Digital Connection: Accelerating Inclusive Growth and Prosperity in Asia

By Victor K Fung / Visa-Free Travel is Key to Tourism Growth

By Dr Mario Hardy / Ushering in a New Era of Global Progress and Prosperity through Trade

By Andrew N. Liveris

78 / More Doing, Less Talking By Kimball Chen

80 / Labor Market Integration in the South Pacific: Lessons from the Australian—New Zealand Experience By Edward Mortimer

82 / E-Learning, E-Commerce and E-Health: How Internet Connectivity Is Transforming Lives Across the Globe

By Fumbi Chima

86 / Innovation as a Sustainable Growth Driver

By Viktor F. Vekselberg

89 / Antibiotic Use in Livestock Farming

By Gwyn Jones

90 / Leaving Nothing to the Imagination

By John W.H. Denton

92 / Financing Global Trade: The Most Important Branch of Finance You’ve Never Heard of By Alexander R. Malaket

Publisher: Chris Atkins

Editor-in-Chief: Ana C. Rold

Creative Director: Christian Gilliham christian@cgcreate.co.uk (+44) 7951 722265

The most successful cholesterol-fighting prescription drug in pharmaceutical history was developed with the help of Waters technologies.

WHAT’S POSSIBLE. TRANSFORM INTO WHAT CAN’T BE DONE

Waters didn’t become the world leader in analytical technologies by working alone. As a result of our deep collaboration with pharmaceutical companies across the globe, Waters systems and technologies continue to play a vital role in redefining what’s possible – as in the development of the world’s most successful anti-cholesterol drug. To learn more about our science in the service of humanity, visit waters.com/pharma

GCEL

The E-Hub of the World is a Must

For nearly a decade, despite all available monetary, fiscal, and trade policies being exercised, the global economy steadfastly remains in a suboptimal condition. In an interconnected world we all need to find a new inventive way of building a sustainable

foundation for the next generation to take on and build the kind of future that we aspire for them - and we need to be inventive given the virtually insurmountable challenges that abound! However, I remain optimistic and hopeful that the ingenuity of man

will prevail, for in the midst of the despair, a glimmer of hope is breaking through the dark economic clouds, a digital ray of sunshine that provides the promise of a brighter future for the global economy.

Co-authored by: Dr. Surin Pitsuwan, Minister of Foreign Affairs, Thailand (1997-2001), Secretary General, ASEAN (2008-2012) Captain Samuel Salloum, Co-Chairman, Global Coalition for Efficient Logistics (GCEL)

Dr. Surin Pitsuwan Minister of Foreign Affairs, Thailand (1997-2001) Secretary General, ASEAN (2008-2012)

“Necessity is the mother of invention - when the need for something becomes imperative, you are forced to find ways of getting or achieving it”.

Oxford English Dictionary

TODAY WE LIVE IN THE 21ST CENTURY TECHNOLOGY ERA. THE BIG QUESTION WE SHOULD BE ASKING IS: WHAT CAN TECHNOLOGY DO TODAY TO HELP REBUILD OUR GLOBAL ECONOMY?

The E-Hub of the World is a Must

Global economic experts agree that the Digital Economy has the power to increase global GDP (USD 73 Trillion) by 10% and create 100 million jobs if it is plugged into the global B2B marketplace.

The old, capital intensive, heavy industries and economic structures of the past are thankfully being replaced by a more agile and sustainable model based on clean, digital technologies that provide open access and social inclusion for all. The pathway to the digital future is clear for all to see, selfdriving cars, intelligent buildings, the ‘Internet of Things’ and portable devices running Apps that seemingly cater to all of our needs. However, less clear is how the digital technology will actually stimulate global growth and bring about the sustainable foundation for the future, so desperately needed.

The current architects of the Digital Economy are focused on the entertainment needs of the populations in high-income countries but they have yet to develop an effective Digital Economy for the supply of basic needs to the world’s population. For example, view the phenomenon of so called ‘virtual augmented reality’ games against the backdrop of millions of starving refugees worldwide and one gets a sense that the Digital Economy is not being effectively targeted at where it can do the most good for the World!

Indeed, the common accepted view is that the Digital Economy is exclusively about the sales of technology devices to drive content and social media, however if the Digital Economy were a plug, which socket should it be plugged into so that it can unleash the greatest economic impact? How can we become more inventive with the power of the Digital Economy to unleash its true potential?

Global economic experts agree that the Digital Economy has the power to increase global GDP (USD 73 Trillion) by 10% and create 100 million jobs if it is plugged into the global B2B marketplace that, according to the VISA Commercial Consumption Expenditure Index is worth an astounding USD 140 trillion annually. The B2B marketplace is nearly double that of global GDP due to the cumulative effect of ‘value adding’ as goods move through global value chains; yet the B2B marketplace is woefully underserved by digital infrastructure.

We have come to a crossroads and need to decide quickly about which path to take. Do we continue to focus

development energy on creating digital devices to deliver digital content to consumers, or focus that energy on the area that has the most potential to transform the world? The Digital Economy is so much more than the latest game or App. It has the power to drive transformational change in our world if applied to the “mother of all industries”, the B2B marketplace and thankfully World leaders agree with that premise.

During the 2015 Turkey B20 conference global business leaders discussed the Digital Economy and for the first time it was adopted by the G20 leaders as an item for action. Furthermore, it is a key topic of discussion at the 2016 China B20 because of its undeniable ability to stimulate the global economy. However, how can we turn discussion into practice and unleash the true power of the Digital Economy to ensure that it meets the growing economic aspirations of the global citizens?

How can we ensure that it stimulates the global economy as a whole rather than merely catering for entertainment needs?

Hangzhou.

GCEL

Xi Jinping

President of The People’s Republic of China

The G20 Summit mechanism was set up at the height of the international financial crisis in 2008, demonstrating G20 members’ determination to put the global economy back on its feet. The G20 thus became the premier forum for international economic cooperation. Looking back, I believe that the most valuable thing this process has created is the close partnership we have forged that has enabled us to jointly tide over a difficult time. It proves that in a world of deepening economic globalization, cooperation is the sure way for countries to meet challenges and achieve common development.

Today, the global economy and international economic cooperation have reached another crucial juncture. Can we strengthen the foundation for global recovery and growth and leave the crisis behind us? Can we seize the historical opportunity presented by technological breakthroughs and a new industrial revolution and usher in a new round of global growth? The answer lies in the

course of common action that we will take.

Now,all eyes are on the G20. As an important forum for cooperation among developed countries, emerging markets and developing countries, the G20 plays a key role in leading and advancing international economic cooperation. It should act with a broad vision and deliver concrete outcomes. It should address critical issues affecting the global economy and endeavor to promote strong, sustainable and balanced growth.

We should strive to build an innovative, invigorated, interconnected and inclusive global economy and explore new ways to drive development and structural reform, injecting impetus into the growth of individual countries and energizing the global economy. We should embrace the vision of a global community of shared future, enhance economic connectivity and exchanges among countries and improve global economic and financial governance so as to address inequality and imbalance in global development and ensure that the benefits of economic growth will be

equitably shared by people of all countries.

In the course of making preparations for the 2016 G20 summit,China will work with all other parties to pull in one direction in the spirit of win-win partnership. We should pool wisdom, form synergy, implement the outcomes of the Antalya Summit and all previous summits, and jointly advance international economic cooperation.

I look forward to meeting the leaders of the G20 members in Hangzhou, Zhejiang next September to discuss ways of enhancing international economic cooperation. Hangzhou, renowned for its rich history, is also a city of innovation. It is a cosmopolitan city with a distinctive Chinese cultural appeal. I am sure that, through our joint efforts, Hangzhou will deliver a uniquely impressive summit to the world in 2016.

Xi Jinping President of The People’s Republic of China

Welcome taken from G20.org

AS AN IMPORTANT FORUM FOR COOPERATION AMONG DEVELOPED COUNTRIES, EMERGING MARKETS AND DEVELOPING COUNTRIES, THE G20 PLAYS A KEY ROLE IN LEADING AND ADVANCING INTERNATIONAL ECONOMIC COOPERATION.

Establishing the Foundation for a Global Digital Economy Platform

It is time to get inventive! There is no lack of good policies that are recommended by global policy leaders but the ones they need to focus on are those that have the greatest global impact and that are implementable. To turn policies into, implementable policies they need to adhere to a set of criteria called an Implementable Policy Formula (IPF). The IPF should bring together all stakeholders of the global economy – government, service providers, and voices of those affected at the ground level – all working together, capitalizing on what each sector does best within their capabilities and jurisdictions.

The IPF is therefore based on the following:

1. A Common Denominator Among Policies: The most common and comprehensive denominator of those tangible and quantifiable policies that have a rapid and direct positive impact on the real economy.

Through more than 10 years of research and development GCEL has positioned the Digital Economy to meet the requirements of the IPF.

Through its membership on five 2015 B20 Turkey Taskforces, GCEL contributed to increasing the profile of the Digital Economy to a key policy recommendation; and through its membership on five 2016 B20 China Taskforces - where the Digital Economy is now at the forefront of policy recommendations with a focus on implementation.

2. Validation and Definition From the Ground Level: It is of paramount importance that the real economy

participants on the ground validate the policy benefits and define the tools they need to do a better job.

The G20 Nations Case Study, the world’s largest diagnostic study of trade efficiency in the B2B market place, has yielded staggering results from those surveyed to date: 85% of B2B trade participants have no digital integration with global value chains and 89% agree that they need a Digital Economy Platform (DEP).

3. Industry Capability and Commitment: Once the policy’s benefits are validated we must secure the related industry resources for rapid implementation.

Based on the above, 26 of the world’s leading technology companies have signed strategic agreements to collaboratively build the DEP because they all agree that no one company can build it alone.

By focusing attention on the Digital Economy and implementing the IPF, global leaders can turn great policy into practice. However, given the critical nature of trade to a Nations’ security, the development and oversight of the Digital Economy cannot be entrusted to one company, one country or one region. It must be geo-politically neutral and nonmonopolistic in nature to ensure unrestricted and rapid deployment. Indeed, one of the key reasons that a global DEP for B2B has not emerged until now was the absence of a governance and deployment structure that could offset any geo-political or monopolistic concerns while being acceptable to all nations of the world.

So, if we accept that the positive effect of the Digital Economy is most profound when plugged into the global B2B marketplace and that the engine of the Digital Economy is to be a DEP, what is the fuel that we must use to ensure maximum performance?

At the core of the B2B marketplace lies trade, which is comprised of 4 main pillars:

1. Commerce 2. Finance 3. Insurance 4. Logistics

Since logistics is the most fragmented of the pillars, if we focus on making it more efficient, we can produce the highest-grade fuel to power the DEP to its maximum output. That fuel is information, created from data of the highest quality, Ultimate Data Quality (UDQ).

Today’s Digital Economy mainly relies on low quality information created from Non-Validated Data (NVD), that is data derived from a single source, such as user reviews and buyer feedback. Despite this lack of validation, user reviews, for example, have become highly persuasive to consumers in the digital environment but they lack the validation required for professional purchasers of goods and services.

At the other end of the scale lies high quality information created from UDQ that is dynamically and continuously validated by multiple parties in global value chains. UDQ has a high level of veracity and can be relied upon by participants in the global B2B marketplace to help make informed purchasing decisions. It also benefits Digital Economy service providers such as banks and insurance companies due to the derisking effect created by greater transparency over global supply chains.

Where can we find the UDQ required?

The answer lies within the 4th pillar of trade – Logistics. It is the main source of UDQ because as shipments flow through the industry clusters in the real economy, shipment data is continuously validated from multiple sources in the same trade lane pipeline.

In a horizontally integrated digital environment, errors or anomalies can be quickly identified and addressed in real time to enable peak logistics performance. At the same time, a system that automates the flow of data in the logistics industry will also generate the UDQ needed to boost the performance of the other three pillars of trade – Commerce, Finance, and Insurance – to reach their full potential and usher in the Digital Economy.

Hence, the lack of a dynamically validated information environment that generates the UDQ is holding back the emergence of the Digital Economy for the B2B marketplace.

Fueled by the rich information of UDQ, the DEP creates a new global e-Market place for B2B. Not just one that covers an e-world trade platform but one that complements trade with the needed services from the Finance, Insurance and Logistics industries, while offsetting geopolitical and monopolistic concerns. Thereby supporting B2B participants around the world, and impacting the lives of billions of people to deliver economic benefits to every corner of the planet.

As noted previously, validation of the demand for the DEP has been gained

from the ground level through the G20 Nations Case Study, which is the world’s largest diagnostic study of trade efficiency in the B2B market place.

To maintain their confidence in the DEP, respondents told us that they want 4 critical items in place:

1. The DEP to be built and governed in a manner that offsets geopolitical and monopolistic concerns.

In response, the DEP will be built and governed within a unique structure that brings together the public and private sectors from around the world to ensure geopolitical balance and offset any monopolistic concerns.

Captain Samuel Salloum Co-Chairman Global Coalition for Efficient Logistics (GCEL)

Establishing the Foundation for a Global Digital Economy PlatformEstablishing the Foundation for a Global Digital Economy Platform

2. The DEP must be sustainable and provided free of cost.

In response, the DEP will be continuously available, free of cost to the end user through Revenue Sharing Agreements (RSA) held with the strategic partners that provide e-Marketing, e-Finance and e-Insurance services.

3. The DEP must be run by a team that includes trusted technology partners.

In response, 26 of the leading global technology firms servicing more than 60% of the World’s GDP have unprecedentedly signed strategic agreements as a first step to be selected to join the team through an open and transparent tender process.

4. The DEP must be operated in a secure way to maintain data security and privacy to the highest level.

In response, the deployment of the DEP will be accompanied by a Global Data Security Standard (GDSS) to ensure data security and privacy is maintained to the highest level that safeguards the privacy of all stakeholders and the information security of both public and private organizations.

To elaborate, understanding that data must be shared across borders, one must address Nations’ interdependent security needs and respect their sovereignties, which can only be realized through a true

Public/Private Partnership (PPP).

As a PPP, GCEL has brought together over 150 countries (through Pan Regional Organizations), 26 NGOs/IGOs and prominent international service industry firms and have developed the GDSS, which is based on the following “Axioms of the 5Cs”:

C.1 Consortium of Globally Balanced Ownership

C.2 Council of Worldwide Fiduciary Governance Board

C.3 Committee of Technology Governance Board Experts

C.4 Controlled Segregated Technology Development C.5 Continuous and Comprehensive Audits

As such, the 5Cs are ingrained into the very DNA of the DEP and provide the strongest of foundations for its construction and secure future operation.

In accordance with the aforementioned 4 critical elements for success, the DEP will be built and operated by the “E-Hub of the World”, a global technology center of excellence, where public, academic and technology organizations will work together as the “E-Hub Core Triangle” .

The E-Hub Core Triangle will synergistically combine the strengths of public, academic and technology entities because:

1. Public entities care for the creation of public goods and desire the widest access of those public goods by its citizens to maximize the welfare of the participants of the real economy. Therefore, a visionary public entity that acts as the Public Partner will provide a world-class location and ensure the implementation of policies to create and sustain the best environment for the E-Hub of the World to thrive, under the protection of the international community

2. Academic institutions produce long and medium term innovations that can fundamentally transform the global economy. Therefore, a leading academic institution will bring together world-class academic minds to build a knowledge center that ensures bursts of technological innovations to continuously feed the capabilities of the DEP. It will also identify policies that can be proposed to the Public entities to accelerate the adoption of the Digital Economy.

3. Technology entities strive to push the frontiers of innovation to build winning products and services that can empower the real economy participants. Therefore, an innovative leading edge global technology firm with the best technological operations will ensure fail-safe design, development, hosting and enhancement of the DEP.

Such a critical responsibility requires an extraordinary team to rise to the challenge – as the very wellbeing of 7 billion people will be in its hands. Failure is not an option. It must be a team with shared strengths, responsibility, ingenuity and tenacity to get the job done. This team is known as the “E-Hub of the World Core Triangle”.

Only a solution that creates an internationally collaborative environment where these natural strengths of public, academic, and technology organizations are woven together can produce the synergies required for sustaining continual innovation of the DEP.

This E-Hub Core triangle team will work closely with the world’s top technology, commerce, finance and insurance firms selected using a transparent equal opportunity process, to act as “Gateways” to deploy the DEP to the real economy participants worldwide and unleash its true power. Such a critical responsibility requires an extraordinary team to rise to the challenge – as the very wellbeing of 7 billion people will be in its hands. Failure is not an option. It must be a team with shared strengths, responsibility, ingenuity and tenacity to get the job done.

The team will be international in nature, representing 44 countries through the Governance Board (28 Country representatives), Technology Board (spanning 12 countries), the commerce, finance and insurance Gateways (covering 3 countries) and the E-Hub host country. Together this superlative, multinational team becomes the guardian of the DEP, the engine that drives the global economy.

The process to construct the E-Hub is now well underway with strong competition from institutions around the world, desperate to host the nucleus of such revolutionary and transformational change. The potential partners for the Core Triangle all recognize the one off opportunity to become global thought leaders and drive innovation on behalf of the global community. They recognize that the pathway to a

brighter economic future for the world lies in the DEP, centered in the E-Hub of the World - created, run and governed in a sustainable, secure way, free of cost to the end user.

Thus the E-Hub of the World is born out of the necessity to stimulate global growth and thereby create the secure foundation for the next generation to build the bright economic future we wish for them. Without such revolutionary innovation, spearheaded by the PPP, the opportunity to bring the global economy out of its sub-optimal state may be missed for a generation, as so called ‘stagflation’ takes hold in many regions of the world. To beat this threat, we must shift the current focus of the Digital Economy away from the creation of yet more devices to where it can achieve the most for the development of humankind –starting with the B2B marketplace.

A NEW PROSPEROUS FUTURE THROUGH THE DIGITAL ECONOMY IS NOW WITHIN OUR REACH

Establishing the Foundation for a Global Digital

Establishing the Foundation for a Global Digital Economy

John Danilovich Secretary General

Global Energy Future to be discussed at Astana EXPO-2017

The development of mankind cannot be imagined without the use of energy. Its major sources are still oil, coal and gas, which have a negative impact on the environment and human health.

According to the IEA, in almost 1.5 century, the CO2 concentration in the atmosphere has gone up by almost 40%. At the same time the world’s energy demand and production are growing at a record pace. Not only does the current situation give rise to concern, but it also calls for an active engagement of the international community in finding alternative solutions, including increasing investment in renewable energy.

The International Specialized Fair “EXPO2017” - “Future Energy” in Astana will

address such pressing global challenges as global warming and the reduction of CO2 emissions, energy safety, conservation of the planet’s biodiversity, equal access to energy and equal opportunities for the economic development of all countries.

“EXPO-2017” will become a global platform that will bring together representatives from more than 100 countries, as well as key international organizations, including the IAEA, OPEC, UNESCO, the World Bank, and the World Petroleum Council. They will discuss current energy policy and try

to develop a new energy model to ensure sustainable development of the planet with minimal risk to the environment.

The highlight of “EXPO-2017” will be Energy Best Practices Area (eBPa) that will feature the most advanced technology, projects, sustainable energy strategies: the production, conservation and use of energy, combating climate change, access to energy in developing countries.

“EXPO-2017” will also be a new and vibrant tourist destination that will enhance any tourism product while the tourists will experience unforgettable emotions and

feelings. Tickets for the Astana EXPO-2017 became available online on June 10. Starting July 10, tour operators from all over the world can purchase discounted tickets for the Fair.

The portfolio for the tourist product «EXPO-2017» has already been created; it includes visits to the most beautiful places of the country: 12 natural parks covering unique places like Sharyn Canyon, Kolsay Lakes, Borovoe, Bayanaul and Karkaraly National Park; the sites included in the UNESCO World Heritage List (Mausoleum of Khoja Ahmed Yasawi, Tamgaly petroglyphs and monuments along the Silk Road; special areas, such as the Baikonur Cosmodrome).

Kazakhstan creates favourable conditions for foreign guests. Last year the visa regime for 20 developed countries was cancelled unilaterally. January 1, 2017 will see the introduction of a visa-free regime for the OECD countries, as well as Malaysia, Monaco, the United Arab Emirates and Singapore. In December 2015 an “ADS” (Approved Destination Status) agreement was signed with China to further simplify the visa regime for tourist groups.

Astana, which is located at the intersection of two civilizations, between East and West, is rightly considered to be the central hub of Eurasia. More than 2 billion people live and work a five-hour flight away from Astana. It is a steadily growing and developing city. The post exhibition complex will contribute to the development and growth of its international prestige and importance. In particular, based on the EXPO-2017 infrastructure, the International Finance Centre “Astana” will be created. The capital of Kazakhstan will become the finance gates of Eurasia, a centre of attraction for investment and innovation. Conditions beyond compare will be created for the Participants of the International Centre and will be unlike any other in the entire post-Soviet area. The centre will operate a special legal regime based on the principles of English law. The Independent

Court of the Centre, composed of international judges, will ensure transparency, fairness and protection of investors’ rights.

The high-tech infrastructure of EXPO-2017 will enable the Centre to implement projects aimed at the development of the “green” economy. The International Finance Centre will have a beneficial effect on the sustainable socio-economic development of Kazakhstan and the entire region. Besides, following the Fair, National pavilions will be converted into offices and laboratories and turned into a Science and Technology Park. ■

ASTANA, WHICH IS LOCATED AT THE INTERSECTION OF TWO CIVILIZATIONS, BETWEEN EAST AND WEST, IS RIGHTLY CONSIDERED TO BE THE CENTRAL HUB OF EURASIA. MORE THAN 2 BILLION PEOPLE LIVE AND WORK A FIVE-HOUR FLIGHT AWAY FROM ASTANA.

Jiang Zengwei

As chair of the B20 China, I extend a very warm welcome to leaders from the international business community, international organizations, consultancies, experts and scholars from all over the world. China is proud to be the host of the 2016 G20 and B20.

At present, the world economy is undergoing fundamental readjustment and the road to overall recovery faces many hardships and setbacks. Achieving strong, sustainable and balanced development in the global economy still has a long way to go. At this critical moment, exchanges and consultations among business communities across the world are particularly necessary

to develop practical and sustainable solutions to support global development. The B20 is essential to the success of the G20.

Over the next year, building on previous B20 policy recommendation reports, we will hold a series of task force meetings and conferences with B20 members and partners. This process will focus on global economic growth, trade and investment, infrastructure, SME development, employment and anticorruption as their focus, and will foster communication and develop consensus between all parties. We look forward to submitting the international business community’s policy recommendations to the G20 Summit.

In this age of globalization and regional economic integration, countries all over the world face similar challenges and share the same trajectories. It is my hope that the international business community, international organizations, consultancies and scholars will work closely together to host a successful B20 thereby contributing to boosting the innovative development, building an open world economy and enhancing global economic governance.

Jiang Zengwei Chair of B20 China and Chairman of China Council for the Promotion of International Trade

ACHIEVING STRONG, SUSTAINABLE AND BALANCED DEVELOPMENT IN THE GLOBAL ECONOMY STILL HAS A LONG WAY TO GO. AT THIS CRITICAL MOMENT, EXCHANGES AND CONSULTATIONS AMONG BUSINESS COMMUNITIES ACROSS THE WORLD ARE PARTICULARLY NECESSARY TO DEVELOP PRACTICAL AND SUSTAINABLE SOLUTIONS TO SUPPORT GLOBAL DEVELOPMENT. THE B20 IS ESSENTIAL TO THE SUCCESS OF THE G20.

Chair of B20 China and Chairman of China Council for the Promotion of International Trade

Trade and Investment: A G20 Opportunity

Getting trade and investment right matters for global growth – the G20 is best placed to accomplish that outcome. Merchandise trade alone still accounts for about 30 percent of global GDP even if the pace of growth has slowed.

Globalmacroeconomic issues, international systemic financial issues, as well as trade and investment are the core of the G20’s business. Yet, trade and investment is the G20’s Cinderella in the company of economic and financial policy even though it is just as critical for global growth prospects.

Let’s not have the G20 repeat history. At Bretton Woods in 1944 it was agreed to establish the IMF, the World Bank, and an International Trade Organization. But, just as at the G20, Bretton Woods was the precinct of finance ministers and only the IMF and World Bank were finalized. The International Trade Organization was left to subsequent talks that in spite of the best peoples and efforts failed to deliver the envisaged global system.

Today we have a patchwork of multilateral and bilateral trade and investment agreements. These agreements benefit from compliance with WTO rules but they also venture well beyond available global guidance. Certainly the current patchwork falls far short of potential for trade and investment.

The multilateral system rests heavily on the early Doha Development Round and together with the noodle bowl of regional agreements defines the global system. Regional agreements while offering potential for a constructive path forward do not always take account of multilateral considerations.

Outdated premises shape this system. Doha saw development from a lens of North-South trade; in the meantime southsouth trade has flourished. It viewed trade as involving separate interests of importers and exporters; in the meantime production networks mean that exporters are importers as well. These development have yet to shift the agenda to areas such as the “doing business” issues that shape global value chains.

In sum, we can and must do much better.

A fit-for-purpose 21st century trade and investment system will look different. The system needs to address the inevitable “known unknowns.” We need a framework that evolves in a timely manner to new and emerging issues.

In a world of self-driven vehicles and 3D printers, the multilateral system must come to terms with digital trade. Moreover, in this age of the fourth industrial revolution even the more recent emergence of production networks will be less important, certainly production will be less labor intensive and more local.

We need a global trade and investment framework that is responsive to the needs of the sustainable development goals. The ambitious 2030 agenda rests on pillars including investment, innovation, and collaboration.

This means that trade and investment is central to sustainable development. Trade and investment is linked directly to the goal on jobs and growth but its criticality extends to the other sustainable development goals. Trade and investment through the transfer of technology, for example, shapes goals from education and healthcare to renewable energy and climate action.

What to do?

Leaders must elevate trade and investment to be a core G20 challenge. The G20’s role is defining the “rules of the game.” It needs to define the framework and institutions that will deliver the outcomes not to negotiate the agreements. Moreover, leaders must recognize that it is their responsibility because modern trade agreements show that trade is a “whole of government” activity.

For finance ministers, trade and investment is core to their goal of strong, sustainable and balanced growth. Trade and investment opportunities must feature centrally in individual country plans.

A broad public engagement remains a missing link. Indonesian Trade Minister

Thomas Lembong said at the G20 workshop in Boao Forum that the public must be closely engaged in the process. There is a distrust of policy makers particularly in some markets, the public lost trust in the constructive role of trade in growth and development. A tri-sector

Authored by: Cherie Nursalim and David Nellor

approach involving civil society, educational institutions, media, business, and government is thus a key to progress.

The G20’s job is thus to create the framework for win-win trade and investment opportunities. It must avoid perpetuating a system that is stuck in a zero sum world. Only the G20 can give the trade and

investment Cinderella the happy ending it deserves and that the world desperately needs.

Thus, however challenging, G20 Leaders and Finance Ministers need to take on the task of providing a global trade and investment framework that is fit for the 21st century. If not the G20 who? If not now, when? ■

Cherie Nursalim is Chairman of Three on the Bund and Vice Chairman of GITI Group, a diversified group with real estate development, manufacturing and consumer lifestyle presence in Asia Pacific. She is an executive board member of International Chamber of Commerce and serves on the Academy and Research boards. She sits on International and Asia Advisory Boards for Columbia University and MIT Sloan, and Chairman of the United Nations Global Initiative SDSNSoutheast Asia. She serves on the University of Indonesia Research Center for Climate Change, Singapore Science Center boards and is Chairman of Tsinghua University Southeast Asia Alumni.

Dr. David Nellor is an adviser to the Giti Group. Concurrently, he is Adjunct Professor at the Lee Kuan Yew School for Public Policy, National University of Singapore and an economic policy consultant. Dr. Nellor had a 24-year career with the IMF focusing on emerging markets especially in Asia. He also has experience in the institutional funds management business. Since 2010, Dr. Nellor has worked as an independent business and policy consultant in Jakarta, Indonesia. He has advised Indonesian government officials as well as worked with Indonesian and multinational companies in South East Asia and China.

A BROAD PUBLIC ENGAGEMENT REMAINS A MISSING LINK. INDONESIAN TRADE MINISTER THOMAS LEMBONG SAID AT THE G20 WORKSHOP IN BOAO FORUM THAT THE PUBLIC MUST BE CLOSELY ENGAGED IN THE PROCESS. THERE IS A DISTRUST OF POLICY MAKERS PARTICULARLY IN SOME MARKETS, THE PUBLIC LOST TRUST IN THE CONSTRUCTIVE ROLE OF TRADE IN GROWTH AND DEVELOPMENT.

his phrase of "strong, sustaina ble, and balanced growth" reso nates with our corporate philos ophy that looks to bring value to all stakeholders our consumers, work ers, and investors because only by that philosophy can we deliver sustainable benefits to our markets and the commu nities in which we operate.

More broadly speaking, I view the United Nations Sustainable Development Goals (SDGs) as giving focus to three challenges that fall on our communities and the world more generally. These challenges are ecological, economic, and social which is about the shared values around peace, stability and mutual respect.

DR. ENKI TAN EXECUTIVE CHAIRMAN, GITI GROUP

We collaborate actively with many stake holders. We are currently represented on the boards of Conservation Interna tional, Singapore Science Center, Inter national Chamber of Commerce and the Business & Sustainable Develop ment Commission. We value our part nerships with educational institutions as MIT, Tsinghua, Fudan, Columbia, Harvard, Chicago, Yale, ITB, Paramadina, Udayana, SMU et al Universities.

We established a foundation, United in Diversity, that is predicated on the concept of collaboration across stake holders and that draws on diversity as a strength. Together with University of Indonesia we co-chair the UN Global Initiative Sustainable Development Solu tions Network in Southeast Asia.

Let’s turn to the role of business. How do you see the role of business in relation to sustainable development?

Business along with the international community has a responsibility to play its role in collaboration with other stakeholders in bridging across these challenges.

A key understanding is that no single stakeholder has the solution. In fact, it is only through the collaborative participation of all stakeholders from business, civil society, educational institutions and government that we will find sustainable and sound solutions to the challenges we face.

Let me note some specific examples of Giti Tire activi ties in relation to sustainable development.

The first point is that we try to live by following green principles in development and production of our prod ucts. Giti Tire is dedicated to the development of energy saving technologies and products.

Giti Tire puts emphasis on the process of tire manufac turing and strives to minimize the environmental impact of tire products by reducing emissions, waste water, and waste materials. It puts these principles into practice. For example, it participates in the annual

LET ME START BY SAYING THAT WE WELCOME G20 RECOGNITION THAT GROWTH IS MORE THAN A SINGLE GDP NUMBER. THE G20 TALKS ARE NOT JUST ABOUT ACHIEVING HIGHER GROWTH BUT ALSO ABOUT “STRONG, BALANCED AND SUSTAINABLE GROWTH”.

car category to become a leader in innovative tire technology that reduces energy use. Giti Tire inaugu ral 2013 entry won the world championship for Pikes Peak electric motorcar race.

I understand that you plan a major development that is premised on the concept of shared value that will integrate sustainable development from the outset. Can you tell us about this plan?

Kura Kura Bali Turtle Island spanning 500 hectares is strategically located in the capital of Bali minutes from prime attractions, resorts and near a brand new Bali international airport and bridge connection. It is a pioneering island project carried out by Bali Turtle Island Development, being uniquely distinguished by its extraordinary and holistic lifestyle.

We are pleased that we have many partners sharing our vision.

Southeast headquarter for the United Nation’s global initiative Sustainable Development Solutions Network will be physically housed under United In Diversity Creative Campus being established in Kura Kura Bali. This initiative was announced by the Indonesian Presi dent and cabinet during APEC Summit 2013 in Bali.

Among the business supporters were Microsoft, WPP, and MAP. Leading architects Frank Gehry, Professor Yu Kongjian from Harvard and Beijing University, and consultants as AECOM are engaged.

Bali is committing to maximum renewable and 100% clean energy and the Minister of Energy of Indonesia has declared Bali to be the National Center of Excel lence to engage business, academia, science and inno

ally be applied across the Indonesia’s archipelago of 17,000 islands.

SDSN is a network launched by the Secretary General Ban Ki Moon of universities and think tanks collaborat ing to support the United Nations Sustainable Devel opment Goals. Tsinghua University which is the global co-chair for the UN SDSN network will also have a key Southeast Asia presence in the Creative Campus.

Preceding the United In Diversity Leaders Roundtable in World Economic Forum Davos 2016, successful signing of MOU witnessed by Bill Gates and President Qiu Yong of Tsinghua University to co-establish the Global Health Drug Discovery in Beijing. Guest of Honour for the Leaders Roundtable, Minister of Trade of Indonesia Thomas Lembong, also graced the signing. Thomas Lembong

Hangzhou. China

Our concept is an Island of Happiness with a creative campus at its core. We aim to integrate traditional culture with the best of the world to create a world-class destination. From a sustainable development perspective, this will be a prototype creative community built on the principles of the Balinese philosophy known as Tri Hita Karana, or the "Three Ways to Happiness", to address people issues (SDG 1-10), ecological issues (SDG 11-15) and spirituality (SDG 16-17).

The Globalization of Poverty

From Davos, to the Vatican; from China, to Washington, to the capitals of Europe, and across the disruptions of the Middle East and developing economies, “income inequality” has become a preeminent concern of our time.

The emergence of this issue comes at an inflection point in the early maturity of the globalization-IT revolution that has already changed the world dramatically--and is about to change the world even more dramatically and rapidly.

The driving forces of change today are by now easily named, if not yet easily or fully understood. The rapid spread of mobile technologies, combined with the globalization of capital markets and industries, global demographic shifts across generations and cultures, and the 24/7 pervasive knowledge base assembled through the Internet and Big Data--these four converging developments are continuing to undermine traditional political and social orders and to create unprecedented social and economic conditions. The scope and speed of change from the four forces is just beginning: this is the tip of the iceberg, and a warning to all Titanics at sea.

One result of the convergence of these forces is the emerging picture of how wealth, poverty, and income distribution gaps are being dispersed and distributed globally. Understanding the systems context of income inequality is vital. The changes underway are so vast and dynamic that many competing frameworks are already in current usage. Political agendas to use inequality for the advantages of groups both on the left and right are rapidly being forged.

While each agenda offers interesting perspectives, it is critical to settle on a core

organizing framework that can guide these forces for good. “In my beginning is my end,” as T S Eliot wrote, and in the same spirit, a sound set of starting assumptions is important for framing the changes in wealth, poverty, and the distribution of assets and opportunity in the emerging new order, if we want to reach a worthy end.

Abundance

Starting with the end in mind, let us posit abundance as the North Star for leaders engaged in guiding and stewarding the vast disruptive forces of the day. The dispersion of knowledge, the emergence of a global economic platform open to all people, and the astonishing technological advances on the horizon make the possibility of abundance a conceivable reality.

By abundance, we mean shared, sustainable prosperity for every living person integrated with a thriving global ecosystem, of which human life, after all, is an integral part. Abundant solutions are systemic, scalable, and sustainable; such solutions provide for both human and ecological well-being. The endgame, from this perspective, is to enable every person on the planet to be a creative economic agent interlinked with all other agents in open, dynamic commercialinnovation networks, within a sustainable and healthy natural world.

In a state of abundance, the bio-diversity and ecosystem of the earth thrives, just as each person in society is able to bring his/her distinctive vision/’talent/skills (“talent

Authored by: Dr. Scott T. Massey

To move in this direction, a new organizing framework is needed. The existing resources of global corporations and leading universities need to be shifted toward expanding shared, sustainable prosperity. Global corporations and universities are the nucleus of this new organizing system, with governments and NGOs aligned.

To move toward this reorientation of efforts will require the emergence of a serious abundance agenda. Such an agenda will build on the best research on the creation of shared value prosperity through regional innovation centers anchored in dynamic cluster industries. Regional innovation hubs are the new engines of expanding opportunity and prosperity. Since human creativity is the primary source of sustainable expanding economic growth, a serious abundance agenda will also prioritize human/social needs. Sustainable abundance requires a flourishing human community where innovation and creative risk thrive. Economics, environmentalism, and humanism are becoming one.

One new effort to engage corporations and universities in building an agenda for ›

BY ABUNDANCE, WE MEAN SHARED, SUSTAINABLE PROSPERITY FOR EVERY LIVING PERSON INTEGRATED WITH A THRIVING GLOBAL ECOSYSTEM, OF WHICH HUMAN LIFE, AFTER ALL, IS AN INTEGRAL PART.

› abundance has been launched through Global Action Platform, a universitybusiness alliance to transform innovation into prosperity through the growth of regional innovation hubs. Global Action Platform is the centerpiece of a new twenty acre innovation campus--oneC1TY-- now being developed in the university-business center of Nashville, Tennessee, USA with plans for related campuses in urban centers around the world. Global Action Platform is also the exclusive NGO global development partner for ten million acres of undeveloped tropical land in the Philippines. By linking an urban model with a rural model, Global Action Platform has developed two living laboratories in which to test and demonstrate sustainable solutions for abundance.

Marbleization

The context in which corporations and universities begin their work on abundance is important to understand. As noted at the outset, the dispersion pattern of poverty, wealth, and opportunity in today’s world is increasingly a concern. What are we to do about a world in which the sixty-five wealthiest individuals own and control more of the world’s resources than half of the world’s population combined?

In Les Miserables, Victor Hugo wrote, “there are two problems for economics-how to create wealth, and how to distribute wealth”. Far from being two problems, today, creation and distribution are powerfully linked. In fact, solving the problem Hugo notes—i.e., solving how to connect creation and asset distribution as a channel with near-zero “noise”—is the primary cultural, economic, and political challenge of our time.

Globalization and information technologies have acted both as an accelerator and as a dispersion agent to expand and distribute wealth and poverty in new patterns and ways. At the top, the global investors, corporations, their shareholders and executives, who had the capacity to capitalize on global markets have grown and prospered in unprecedented ways. At the same time, the industries and people making up the “middleware” of the global economy have seen the wealth and opportunities in the middle disperse around the globe. This has raised millions of people out of poverty in places like China and India, while driving older middle classes in advanced economies such as the US into poverty, or at least reduced wealth. As all sectors of society have been drawn into the global market, poverty, wealth, and opportunity have “marbleized” around the globe. The creation-dispersion pattern of this

state of affairs is indicative of a high level of inefficiency. Or “noise” in the system.

When the globalization-IT revolution started, leaders expected that development would move in traditional, uni-directional ways. Advanced economies, like the US, were expected to go through a process of deindustrialization in which they shed lower and mid- skill industries and jobs to developing economies. In the advanced economies, major school reform was then launched to rapidly accelerate the expansion of high skills and knowledge workers who would lead the innovation systems of the global economy from companies in the advanced economies.

The transfer of middle and lower skill industries and jobs to developing economies was seen as a positive development that would take developing societies through the process of industrialization and urbanization that had transformed the US and EU in the past. After industrialization, it was assumed these economies would continue to progress toward higher skills and wages.

However, the economic and social changes that emerged did not follow this course, and for two key reasons. First, education reform failed to produce a new, comprehensive talent pipeline for high skill knowledge work in the advanced economies of the world. Perhaps this should have been anticipated, since every community and society is composed of people with widely different aptitudes and capacities; and since local populations are not fungible assets (i.e., a local population remains in place) and so education cannot be expected to alter the makeup of any local population totally, i.e., make everyone high skilled and entrepreneurial. In short, local populations are intrinsically mixed in aptitude and talent; no educational reform regimen can eliminate

the diversity and range of human ability.

Instead of full scale school reform and transformation of skills in advanced economies, educational institutions around the world have raced to the top. As a result, top talent can come from anywhere. At the same time, lower wage markets have proven effective in providing middle skill work forces and this has depressed wages and scattered industrial capacity and corporate supply chains.

In short, due to intrinsic diversity of human talent across local regions and the opening of all conditions to global opportunity and competition, wealth has grown, global poverty has marbleized across world economies, and opportunities have dispersed and expanded to near universal access to knowledge and markets.

The question of the day is--how do we move from where we are now to a world of shared, sustainable prosperity and abundance for each and every person in a sustainable environment?

Relocalize Economies

As part of the solution, the pull of globalization needs to be balanced with new strategic forces of regionalization. The world needs to proliferate powerful regional economies capable of deploying the talents and values of the local population in global markets and restoring local ecosystems. Starting with the fact that local populations largely remain in place, and that human talent is the most important economic asset in the global economy, expanding the global platform of opportunity depends on a more strategic and intense engagement of the assets of local regions--linking their universities, businesses, investments, and the mix of local talent to participate and compete globally. That is, we will need to expand opportunity by building economic capacity closer to home, where the major disruptions to wages and opportunity have occurred, and where the greatest pool of underutilized talent exist.

Locally regionalized innovation will also need to be created with a north star of values built into the culture. Michael Porter’s concept of corporate “shared value” is one of the leading theories to address this need. According to Porter, it is no longer enough for corporations to have strategic competitive advantage; they must also have a “shared value” moral compass at the heart of their governance, strategy, products, and services. By “shared value”, Porter means that commercial activity, at its core, must link economic success with positive social, environmental, and governance impacts. So efforts to strengthen local regional

INSTEAD OF FULL SCALE SCHOOL REFORM AND TRANSFORMATION OF SKILLS IN ADVANCED ECONOMIES, EDUCATIONAL INSTITUTIONS AROUND THE WORLD HAVE RACED TO THE TOP.

innovation will need a shared value compass to guide the development toward solutions that promote social and environmental well-being. Leaders of local regional innovation will need to develop a new “abundance intelligence,” a new way of thinking that builds on current scientific, technical, and economic expertise, but combines these skills into a new, higher synthesis, a new social wisdom.

The challenge the world faces now is to frame long term solutions and innovations that have the capacity and promise to create abundant food, health, and prosperity for everyone while also sustaining the planet. Solutions are simultaneously local, regional and global. In short, solutions require local cross-sector leaders to imagine, to explore— and to specify—how innovation can create abundance, and how we can efficiently and much more effectively connect and network investment leaders, research institutions and innovators to collaborate in fulfilling the promise of abundance.

Innovation for Abundance

The future welfare of both human beings and the planet depend on a distinctly human resource—innovation. Our emerging economies demand more timely solutions, access to innovation, improved efficiencies and high impact results. On this there is broad consensus. In order for societies to be innovative, people must be able to thrive; they need food, health, and the tools and systems of innovation that produce sustainable, inclusive prosperity.

As we strive to achieve sustainable, shared prosperity, leaders and innovators will need to collaborate together to create a shared platform for clear, more efficient decisionmaking and informed actions to guide our future. There is a need for a growing network of university-business-government-NGO alliances, coupled with significant impact investment funds, to provide thought leadership and operational real-world “laboratories” in which to design regional abundance ecosystems. These regional platforms will also need to take a lead role to formulate and apply specific ideas that define abundance intelligence.

These concepts--abundance intelligence and abundance ecosystems—build on the growing trends of shared value enterprise, impact investment, sustainability, and regional solutions, and “collaborative advantage.” That is, abundance thinking adds a higher level of knowledge (an exponential, not an additive change) in designing solutions that increase alignment, collaboration, and

build the critical mass in the civic space to achieve optimal impact. Local regional innovation hubs will need to be designed around collaborative advantage as a norm.

Another key dimension of regional innovation hub design is “fit.” According to Michael Porter, there are three types of fit. First Order Fit is simple consistency among various activities in a company or initiative. Second Order Fit is reinforcing; that is, when processes and activities reinforce each other, they increase strategic value and outcomes.

Finally, Third Order Fit is optimizing. Third order fit is comprehensive, building on consistency and reinforcing processes to optimize the effects of all levels. Effective regional innovation hubs will also be designed to develop first, second, and third order fit in all details and aspects of the local abundance ecosystem.

The creation of an abundance ecosystem is a dynamic, iterative process; hence, innovation hubs for the future will be designed to connect activities into an ongoing, systematic process that can attain

critical mass and self-reinforcing virtuous cycles to optimize impact necessary for abundance. The localities that can overcome existing competitions and disconnected assets to leap to strategies for abundance will lead the way and chart the course for our future. ■

Scott T. Massey, Ph.D Chairman and CEO, CumberlandCenter, is a national leader in innovation, economic development and strategy with extensive experience with regions and universities. His professional leadership roles have been exclusively at the CEO level. Massey has founded and led major institutions, led regional economic strategy, developed innovation metrics, and worked with universities on tech transfer and commercialization. He has designed capital campaigns, advised national organizations on strategic planning, advised universities and regions on regional strategy, and served as an external academic evaluator of university programs.

Caterpillar introduces “The Age of Smart Iron”

Asthe digital transformation of the world continues at a rapid pace, the construction, mining, energy and transport sectors are proving no exception to the vast opportunities technology has to offer.

Caterpillar, an industry leader in the transformative technology revolution, recently introduced “The Age of Smart Iron” at the bauma 2016 trade show in Munich, Germany.

The Age of Smart Iron describes Caterpillar’s approach to maintaining its position as industry leader in the delivery of digital solutions to industry which contribute to productivity, safety, efficiency and profitability.

Chairman and CEO Doug Oberhelman said while Caterpillar had always been a leader and innovator around the iron – the machinery and equipment, “we do that better than anyone and now we’re going to lead innovation in smart iron, too”.

The Age of Smart Iron not only defines Caterpillar’s future, but grounds its past and present, he said.

Importantly, The Age of Smart Iron positioned Caterpillar differently to its competitors because much of its business was already leading industry in the digital technology and connectivity sphere.

While economic conditions and the competitive environment add to the challenge of the quest, Mr Oberhelman said Caterpillar would lead the transformation by accelerating its digital technology focus and helping customers succeed by offering powerful solutions to improve their capabilities, productivity and operating margins.

Mr Oberhelman said every new Caterpillar product release had become more sophisticated, productive and efficient and the company would accelerate work on integrated approaches to analytics and applications to deliver results.

In this regard, Caterpillar’s competitive advantage is its foundation of an existing, worldwide asset base and strong dealer network.

“We have approximately 400,000 connected assets and an installed base

of three million machines and engines at work around the world today,” Mr Oberhelman said.

“That foundation gives us a head start, and we’re building on it.”

The extensive worldwide dealer network gives Caterpillar the unique opportunity to combine data from all Cat machines onto a common platform, and share the analytics to provide multiple solutions to meet customer needs in construction, mining, energy and transport.

“When you combine the expertise and experience of our people with our unmatched dealer network, you see Caterpillar’s great competitive advantage,” Mr Oberhelman said.

“We know how to build solutions, and we have the distribution network to deliver and service those solutions.”

He said Caterpillar had been dedicated to helping customers succeed since 1925.

“Visit just about any country in the world and you’ll see Caterpillar yellow iron at work, building and delivering the infrastructure and energy that brings higher standards of living.

“Think about the benefits when all of that yellow iron is smart iron, too.”

To summarize The Age of Smart Iron, Mr Oberhelman said the vision was to enhance the company’s Cat Connect Technology and Services offerings.

“Entire fleets and job sites – every machine, engine, truck, tablet, light tower, smart device and drone – will eventually share data on one common technology platform and speak the same language.

“I can’t wait to see what that means for our customers – and for us.”

The strategy was evident recently at the world’s largest construction industry trade show, bauma 2016, as Caterpillar featured more than 60 products, a large selection of work tools and a full range of dealerdelivered support services.

Caterpillar Group President, Rob Charter said it provided a suitable platform for Cat technology.

“While we always love to showcase our machines and engines, we’re equally excited about what’s at the centre of our exhibit: Caterpillar technology,” he said.

“This is not technology for technology’s sake.

“It is technology that’s focused on solving, and even anticipating, customer problems.

“We’re taking the machines, locomotives, engines and parts we’re so well known for and making them smarter, while also equipping the people who operate them with data that makes them more productive, enhances safety and improves sustainability.”

Some of the main attractions of Caterpillar’s digital technologies and connected iron at bauma 2016 included Cat Connect Technology specific to the construction industry.

Authored by: Neil Hare, President and CEO of Global Visions Communication

Cat Connect is hardware and software available for Cat or competitive equipment that delivers information to customers and is designed to help optimise their operations. Technologies in the Cat Connect suite

specific to the construction industry segment include LINK, GRADE and COMPACT and PAYLOAD.

LINK is a solution to capture vital performance and product health data and

makes that data available on the web to guide operational decision-making.

GRADE and COMPACT are two productivity solutions to help operators move material faster, more accurately and with fewer passes of the machine in order to improve efficiency and productivity on the jobsite.

PAYLOAD, an on-board system for haul trucks and loading tools, such as a wheeled loader, drives higher efficiency by shortening the time of each loading cycle and lowering the cost per tonne of material moved. ■

CAT CONNECT IS HARDWARE AND SOFTWARE AVAILABLE FOR CAT OR COMPETITIVE EQUIPMENT THAT DELIVERS INFORMATION TO CUSTOMERS AND IS DESIGNED TO HELP OPTIMISE THEIR OPERATIONS.

World Chambers Congress: Fostering opportunities, cultivating innovation

The World Chambers Congress is the largest, most influential forum of its kind assembling more than 1,000 business and chamber leaders from across the globe. Now in its tenth edition, this event has become the premier venue for sharing best practices, developing networks and discovering new areas of innovation.

Organized

by the International Chamber of Commerce (ICC) World Chambers Federation (WCF), the Congress is held biennially and takes place in a different region of the world each time. The next edition is set to be held in Sydney, Australia on 19-21 September 2017 and co-organized by the Sydney Business Chamber (SBC). This will be the first time the prestigious event will be hosted in Australia and will allow the island nation to showcase its vast business incentives.

“This Congress will provide unparalleled access to global trade opportunities and will be a chance for all attendees to play a part in stimulating global trade progress. Sydney will provide the perfect destination for future focused discussion and is a natural partner city for the Congress,” said Stuart Ayres, Minister for Tourism, Trade and Major Events NSW.

As a gateway to the Asia-Pacific region, Sydney presents an array of exciting possibilities. The harbour city holds a prime position as an international hub for business, finance, education and cultural communities. Paired with an outstanding reputation for connecting businesses with industry experts through collaboration, knowledge sharing and commercial opportunities, it is certain that Sydney will deliver an exceptional experience.

With more than 110 nations regularly attending, the event’s popularity continues to increase. From less-developed countries such as South Sudan to larger developed nations such as the United States, chambers of all sizes eagerly await their chance to secure the honour of co-organizing. In fact, WCF receives bids from chambers of commerce several years in advance. This is because the Congress brings a multitude of advantages

to not only the area but the global chamber movement as well. There are currently offers to co-organize the renowned event through to 2021.

“ICC is the world’s business organization and as such has a pivotal role in convening conversations that improve business, improve global sustainability and build bridges between nations,” said Steve Killelea, founder and Executive Chairman of the Institute for Economics and Peace and confirmed speaker of the 2017 Congress.

10th World Chambers Congress

Next year’s Congress programme will address current global trends affecting chambers of commerce and their respective business communities: from international trade to climate change and other pressing issues that transcend national boundaries. ›

› Through plenary and workshop sessions, participants will gain insights from an exceptional list of internationally renowned business and thought leaders, governmental figures as well as chamber executives.

To accompany delegations, each and every Congress offers an extensive programme. This includes a business programme, exclusive side events and the chance to set up special meetings so delegates can capitalize from the presence of specific industry sectors and companies.

Chambers and leading corporations will also have the chance to attend the exhibition area. This space is truly an excellent setting to promote opportunities and other relevant activities in their region or model specific products and services. The Congress provides an ideal platform to enhance a brand’s image and gain recognition with high-value contacts.

Unparalleled opportunities to connect and strengthen relations with chambers of commerce and business leaders will also be indispensable for participants. In addition

to creating new institutional ties, the Congress is an ideal occasion to bolster trade and investment opportunities from attending industry heads, companies and governments.

World Chambers Competition

A key feature of the Congress is the World Chambers Competition—the only global awards programme that acknowledges and rewards the most innovative projects undertaken by chambers of commerce and industry on an international level. This is a unique occasion for chambers to unveil current projects and display how they are making positive steps to improve communities.

Applications for the 2017 Competition will open on 4 November 2016 with the final deadline on 4 April 2017. Previous winners include the Calgary Chamber of Commerce for a disaster preparedness product, which they provided to local businesses. So impressive was the project that it is currently being expanded throughout the world to aid the private sector in facing natural disasters.

Categories for the upcoming Competition include:

Best CSR project: Rewarding a project linking both business and their social responsibility actions to community, philanthropic, environment, workplace and marketplace activities.

Best job creation and business development project: Candidates in this category have either created a project that has boosted growth opportunities for chamber’s member companies or has contributed to job growth in its community, generating a long-term value for the business ecosystem and the society.

Best SMEs financing project: This category will recognize exceptional initiatives and projects led by chambers of commerce that have helped its small to medium-sized enterprises (SMEs) and entrepreneurs access finance to address their business operational and development needs.

Best unconventional project: Go to a chamber that has developed an exceptional project in an activity not typically associated with a chamber of commerce’s mission and objectives and must be inspirational and innovative.

The ICC WCF and SBC are extremely excited to welcome you to the World Chambers Congress in Sydney in 2017. The 10th edition of this event will certainly act as the ideal stage for all businessmen and chamber representatives alike to achieve their goals, whatever they may be. Sydney is a key link in the chain to business in Asia-Pacific, and the Congress will encapsulate this sentiment. ■

TO ACCOMPANY DELEGATIONS, EACH AND EVERY CONGRESS OFFERS AN EXTENSIVE PROGRAMME. THIS INCLUDES A BUSINESS PROGRAMME, EXCLUSIVE SIDE EVENTS AND THE CHANCE TO SET UP SPECIAL MEETINGS SO DELEGATES CAN CAPITALIZE FROM THE PRESENCE OF SPECIFIC INDUSTRY SECTORS AND COMPANIES.

Network, knowledge, know-how

Combatting Global Climate Change

In April 2016, around 170 states officially signed the Paris Agreement in New York. Successful implementation of the agreement will rely – to a great extent – on the development of market mechanisms which have the capacity to significantly advance emission trading systems. It is now up to the G20 to move forward in the realization and implementation of the Agreement.

Inorder to reach the Paris Agreement, it was necessary to change the rules of the game. The new agreement does not focus on the common global goal, which was previously broken up and divided between parties and included clear reporting, verification and compliance mechanisms. Instead, states now present national contributions under the UN Framework Convention on Climate Change, measured against the global “well under 2 Degrees” target. However, based on national contributions received so far, it is predicted that we are heading towards a three degree increase. In the absence of appropriate international mechanisms which ensure mitigation efforts are implemented fairly, singular efforts will be rendered redundant.

Climate protection has been divided into individual national solutions, deviating from a global level playing field that could prevent carbon leakage and the shifting of energy intensive industries abroad. Crucial to this approach is that States develop mechanisms which sufficiently protect against carbon leakage whilst ensuring that this do not distort competition.

All the more significant is the effort of states in Paris to commit to the significant increase of the adaptation funding from current levels to the 100 billion dollars p.a. which had already been decided in Copenhagen. Another positive development is the possibility for states to cooperate with each other in the implementation of their national contributions to reducing greenhouse gas emissions following Article 6 of the agreement.

Global business organizations, such as the ICC, as well as other national business organizations have advocated for the so called “cooperative measures”. In the global context, it is more important to focus on how much carbon dioxide is being saved rather than in which region of the world it is being saved.

What tools are available for cooperation?

In the EU for example, the current revision of the EU Emissions Trading System provides the possibility of bringing back such international mechanisms – allowing industrialized states to implement a part of their reduction commitments abroad. International Mechanisms facilitate capacity building, technology transfer and investment opportunities in emerging markets, whilst providing flexibility for countries implementing commitment reductions. This cooperation creates a win-win situation for participating parties. As the EU is the potentially greatest demander of Carbon Emission certificates, this would significantly contribute to the financing of adaptation measures.

In order to actually advance climate protection and achieve the ambitious goal of carbon neutrality in the second half of the century, global solutions are indispensable. It is pivotal for the success of the Paris Agreement that G20 places climate protection on its own agenda – and advocate for stronger international cooperation with other states. A truly global level playing field, including all major trading nations, will only be achieved with greater international cooperation, cooperation that avoids falling back to unilateral measures which are harmful to international trade. ■

Authored by: Dr. Werner Brandt

Climate Change

CLIMATE PROTECTION HAS BEEN DIVIDED INTO INDIVIDUAL NATIONAL SOLUTIONS, DEVIATING FROM A GLOBAL LEVEL PLAYING FIELD THAT COULD PREVENT CARBON LEAKAGE AND THE SHIFTING OF ENERGY INTENSIVE INDUSTRIES ABROAD. CRUCIAL TO THIS APPROACH IS THAT STATES DEVELOP MECHANISMS WHICH SUFFICIENTLY PROTECT AGAINST CARBON LEAKAGE WHILST ENSURING THAT THIS DO NOT DISTORT COMPETITION.

Dr. Werner Brandt is Chairman of ICC Germany, the national committee of the International Chamber of Commerce in Germany. He is Chairman of ProSiebenSat.1 Media AG and of RWE AG. From 2001 to 2014 he was member of the Executive Board and Global Managing Board of SAP AG and was the chief financial officer (CFO).

Authored by: Peder Holk Nielsen

Moving the Global Climate and Sustainability Agenda Forward Through G20

As China assumed the G20 Presidency at the end of 2015, it did so shortly after an unprecedented set of international agreements on Climate Change (COP21), Sustainable Development Goals (SDGs) and Financing for Development (FfD) were reached.

Looking ahead, alongside finance and trade issues, all countries will increasingly look to underpin their economies whilst considering environmental, climate and development.

China has first-hand experience of this dynamic. In less than 30 years Chinese economic growth has improved the well-being of tens of millions of its citizens and transformed global trade and production. It is now driving economic reforms, with sustainable development key to its future success. It has already advanced a number of important strategies and pledged to reduce carbon emissions.

Similar actions are underway across G20 members, as they seek to outline their climate change and sustainable development1 contributions through national policies

and investments.

Businesses are becoming ever more aware of and ever more engaged with this new reality. Companies are seeking to enhance operational efficiencies and value and supply chains; they are focusing more attention on the use of natural resources and environmental footprints and becoming ever more innovative.

Strong leadership, courage and determination are all essential if G20 and Business Leaders are to move a shared agenda forward. There are several areas where efforts to enhance the relationship between global policies on the one hand and business innovation on the other should be focused, if we are to achieve the best possible outcomes.

Firstly, G20 energy policies and investments must be central to overall climate efforts.

Across all types and forms of energy, combined global energy demand is expected to increase by a third by 2035, the majority from coal, oil and gas. With a global consensus on the need to address climate change, now is the time to accelerate the development and commercial-scale deployment of a range of sustainable energy and low carbon options.

For Business, energy is the largest focus area for infrastructure investment. To enable forward-looking investment in reliable, affordable and sustainable energy and the development of innovative solutions by the private sector, long-term, policy frameworks and support remains essential. This is particularly true for renewable energy, where technologies and projects can take many years to develop and implement.

Secondly, with global population expected to reach 9 billion by 2050, we will need to almost double current agricultural output.

Climate change impacts such as changing weather patterns will not make it easier to address this challenge, with farmers in developing and emerging economies among those most likely to be affected.

We must rethink traditional value chains to help farmers increase crop yield, particularly in areas with marginal land to help enable farmers run economically viable businesses, increase food security and reduce poverty.

Traditionally, agriculture and energy are often considered separately and not very well linked, yet agriculture should be seen as a prerequisite for developing new value chains that can make efficient use of agricultural waste products. Facilitating a shift from conventional agricultural patterns to a new, balanced rural development would benefit energy and climate issues; this in turn would have a positive impact on the relationship between urban and rural areas in terms of growth and jobs.

Thirdly, annual consumption in emerging markets will rise significantly in the next decade. The way that products are both produced and consumed must become more sustainable – if only to cope with increased demand on natural resources.

For example, producing just one pair of denim jeans requires around 11,000 liters of water. Aside from growing societal interest in product sustainability, the vast majority of consumer goods such as textiles are produced in G20 countries, leading to a clear interest both at global and at national level to support growth whilst managing resources.

Lastly, combining trade and the environment can be mutually inclusive ways of driving a global sustainable development agenda.

In recent years the G20 and B20 have both highlighted and supported efforts to complete the latest round of WTO negotiations and encourage forward-thinking multilateral trade agenda. A timely conclusion of the Environmental Goods Agreement would help in removing barriers to trade in “green” goods, and would include for example the elimination of tariff and non-tariff barriers on energy and environmental goods and services.

Whilst delivering on its mandate to promote global economic growth and strengthen the world’s economy, as a forum for global governance and political leadership the G20 has a unique role to play in contributing to a more sustainable future.

G20 and Business leaders must seize this opportunity: Doing so will see growth and innovation support the use of the world’s resources for the benefit of humanity, the economy and the natural environment. ■

1 Sustainable Development is a term that generally encompasses issues related to addressing poverty reduction, environmental protection, climate change and inclusiveness whilst balancing economic growth.

Sustainability

Peder Holk Nielsen became CEO Novozymes in April 2013, and has dedicated his career to industrial biotechnology. Since 1984, Peder has worked in many different parts of Novozymes, shaping the company as it is today and solidifying the market insight and research capabilities that will foster Novozymes of tomorrow. He has led a number of the company’s Divisions, from new business development, to R&D and Sales.

Peder holds a PhD and MSc in Chemical Engineering from the Technical University of Denmark and a B.Com. in International Business Management from Copenhagen Business School.

Hangzhou. China

ACROSS ALL TYPES AND FORMS OF ENERGY, COMBINED GLOBAL ENERGY DEMAND IS EXPECTED TO INCREASE BY A THIRD BY 2035, THE MAJORITY FROM COAL, OIL AND GAS.

From Negative to Positive: The New Path of Sustainable Business

■ 50% of the materials we use to make all our products are from recycled or bio-based sources

■ The carbon footprint of our products has been reduced by 50% since we started our sustainability mission

Twenty-two

years ago, an unlikely chain of events was set off in an unlikely place – in the heart of an ‘avowed capitalist’ – an entrepreneur who was, at the time, 60 years old and at the top of his career as the founder and CEO of Interface, a billion dollar commercial carpet tile company based in Atlanta. Today, that company finds itself on the brink of victory – poised to celebrate a key milestone in a journey to eliminate the company’s environmental footprint by 2020. And yet, ever restless in its quest to create a lasting positive impact on the world, the company has proposed a new mission to address the biggest challenge facing humanity: to reverse climate change. Erin Meezan has been at the helm of sustainability for the company for 7 years.

In 1994, our Founder and CEO Ray Anderson challenged our company to adopt a bold new vision, zero footprint. His challenge was sparked by a personal epiphany, prompted by a question from a visionary project manager working on a

green building. He asked, “What is Interface doing for the environment?” Spurred to answer this question, our founder created a task force and was asked to deliver the kick off speech. As he was thinking of his speech, a book landed on his desk – The Ecology of Commerce, by Paul Hawken. Hawken’s thesis was – and is – that the Earth and all of its natural systems are in decline, and that business and industry are not only the culprit, but also the most well-positioned to reverse the damage. Ray was catalyzed by Hawken’s premise, and with the same entrepreneurial spirit by which he had built a market for modular carpet where none had existed, he challenged the company to chart a course forward, toward zero environmental footprint.

Interface didn’t have a map for zero footprint, but Ray’s vision was the compass. As the path unfolded before us, a passion for this higher purpose of sustainability took hold with our people and our culture was transformed. We embraced that original vision to the point that it became part of our DNA, and over the last 22 years we have revolutionized our company, our operations and our products, deeply reducing the environmental impacts of our business and creating products that manifest our Mission Zero™. Along the way, innovative thinking has contributed to our bottom line, with products that have broken new ground in terms of design and performance, and created a support and love for the Interface brand that has been unprecedented.

By the numbers, some of the most significant accomplishments we have achieved to date include:

■ Greenhouse gas emissions reduced per unit of product 92% from 1996

■ Globally, 84% of energy used at Interface comes from renewable sources

■ Waste to landfill has been reduced by 91%

■ Water use reduced by 87%

In a more abstract way – and perhaps a better measure of our impact – is the role we have played in proving what’s possible for business. We’ve been called “the most sustainable company in the world” and we’ve heard from countless companies about our role as a “case study” of sorts – an open and accessible example of what is possible when industry takes a broader view of its place in society.

As our zero footprint goal year of 2020 approaches, our focus is shifting from the focused drive to zero that has typified the first 22 years, towards the positive impacts we can create through our business to impact our people, our communities, and the world at large.

Shifting to Positive Business

As Interface is poised to achieve our zero footprint goals, we’re also mindful of a shift happening in the world – and in our business. The expectations of business are changing, away from a “responsible business” mindset to a positive impact approach. This thinking expects more of businesses than profitability and stakeholder engagement. It’s a way of thinking of business as a mechanism to deliver positive impacts, and as a way to solve bigger problems. At Interface, we’re excited about this shift to positive business.

Positive business as an approach is still evolving. An exact definition doesn’t exist yet, but some important principles are emerging. One powerful principle is partnership and how companies must form relationships with other organizations to create more equitable and more significant impacts. In fact, according to the 2016 Sustainability Leaders study by GlobeScan and SustainAbility, sustainability experts believe that governments and the private sector equally share the responsibility for advancing sustainable development over the next two decades. In addition, multi-sector partnerships are seen as playing a critical role.

We’ve not only seen the power of partnerships to amplify our impact in our explorations of positive business, but we find it to be essential. Our Net-Works® project is a great example of making a positive impact.

Interface relies on optimism to drive positive business with positive impacts.

Authored by: Neil Hare, President and CEO of Global Visions CommunicationErin Meezan, vice president of sustainability for Interface, Inc.

At its heart, Net-Works is a partnership with an NGO (the Zoological Society of London), a global yarn manufacturer (Aquafil), Interface and local communities in the Philippines. These partners came together to create an innovative supply chain program that harvests used fishing nets from the Danajon Bank as a source for recycled yarn for Aquafil, and ultimately Interface. Without the expertise, reach and resources of these organizations, Interface would not have been able to create a program that aspires to impact one million people by 2020.

It’s often one unique non-traditional member of these business partnerships -local communities -- that illustrates another important principle of being a positive business: creating an inclusive approach. More specifically, this means ensuring that affected communities are involved in creating the positive effects. By working to involve local community members in the design and governance of the Net-Works program and by paying them for the net collection, Net-Works is creating a powerful new wmodel of inclusive business.

Another idea we’re exploring at Interface illustrates a final principle important for positive businesses: using a restorative approach. This means making sure the solutions we deploy in our business are not just environmentally sensitive, but illustrate a restorative approach. In collaboration with Biomimicry 3.8, Interface is asking how we might operate our factory locations like a high performing ecosystem and provide similar services as local ecosystems to the places where we work. It sounds metaphorical, but we’re exploring standards for factory sites modeled on services of local ecosystems that will give us measurable goals and targets. ›

POSITIVE BUSINESS AS AN APPROACH IS STILL EVOLVING. AN EXACT DEFINITION DOESN’T EXIST YET, BUT SOME IMPORTANT PRINCIPLES ARE EMERGING.

From something negative comes something positive.

84% of the energy used to manufacture our carpet tiles around the world comes from renewable sources*, helping us produce carpet in a more sustainable way. By 2020, we plan on using more than 90% renewable energy. Because we’re not just creating a more beautiful product, we’re creating a more beautiful world. Join us in making a positive impact at interface.com

*Interface Americas now operates using 96% renewable energy.

› Driving Positive Impacts in the World Interface has always been optimistic, beginning with our belief that our company could change, and later that we could be an example of sustainable business. It started with our commitment to climb what Ray Anderson described as Mount Sustainability – the analogy he created to impart the enormity of moving to a zero footprint company.

By setting a bold vision that inspired our company, followed by creating a plan to achieve it and not wavering, we’ve empowered our company and shown that optimism can lead to action and change.

Fast forward 22 years and Interface is applying this same optimism to the next step on our sustainable business journey –Climate Take Back.

This next step is grounded in one simple reality - there is no such thing as a sustainable business in an unsustainable world. For all the progress we’ve made in 22 years, we’re still working in an unsustainable system. This is particularly true when you look at the threats we face from global climate change.

We need to start by changing how we think about climate change: it’s an opportunity, not a problem.

We need to consider new platforms to focus on reversing not mitigating it. Many of the tools already exist, other solutions are rapidly coming online. We believe we can reverse climate change if we focus on four key areas:

■ Only take what can be replaced and keep our emissions to levels that can be managed

■ See carbon as a resource and use it as a building block

■ Restore nature’s proven ability to cool, mimicking nature’s strategies

■ Create new business models to drive change

Expectations on business to drive sustainable development are rising, and those of national governments are declining, according to the 2016 Sustainability Leaders study. But, public and private industry partnerships continue to be critical for the ongoing success of positive business initiatives. We think this sends a clear signal to businesses about the need to adopt a positive business approach that sets more ambitious sustainability goals, like Climate Take Back – and seeks not just to minimize the impacts of businesses on the planet, but asks, how can we maximize the positive impacts of businesses?

This will require new partners, new approaches to business that are more inclusive and equitable, new ways of collaborating – through innovative, crosssector, public-private partnerships. We need to look for new, innovative approaches to mapping how business can solve global challenges, perhaps by mapping business objectives to the United Nations Sustainable Development Goals as a starting place. We also need to create new ways to measure the impacts of positive business.

At Interface, we are taking the first steps to solve a big global challenge – climate change – that will require the collective abilities of many companies, NGOs and government bodies. We need to work together. It starts with us sharing our ideas and a plan for our business and partnering with global leaders to uncover ways they can begin to address this bold goal in their institutions.

We have taken a stand naming the bold goal of reversing climate change to start a different conversation, to create a sense of optimism and opportunity around carbon –and to work with others to identify and implement solutions that will get us there.

We have been successful leading by example in the past and we plan to approach Climate Take Back in the same way. And we’re ready for the world to join us. ■

As Vice President of Sustainability for Interface, Erin Meezan gives voice to the company’s conscience, ensuring that strategy and goals are in sync with the aggressive sustainability vision established in 1994. She leads a team that provides technical assistance and support to the company’s global business, addressing sustainability at all levels – from operations and management, to employees and customers, and in policy forums.

WW865 Autumn Warp

Introducing the World Woven Collection

Weaving global inspiration into positive change.

To

Large and small squares, planks and skinny planks.

Human Bionics Interface: Australia’s G20

Inspired Alliance Accelerating New Global Partnerships

Since the first Innovation 20 was staged in Brisbane, Australia in 2014, unique possibilities have continued to unfold for Australia’s leaders and global collaborators in the field of human bionics.

Human

Oneof the rapid high growth industries of the 21st century (with a combined global bionics and artificial organs market of USD 38.75 billion projected by 2020), the new science of human bionics emerged with the first successful commercialisation of a neuromodulation device, the Australianinvented multi-channel cochlear implant (bionic ear). This device has transformed the lives of people the world over and other bionic devices are now fast emerging to treat a range of other sensory and previously untreated medical conditions.

During Australia’s G20 year, Brisbane-based healthcare leader, Dr Dimity Dornan, resolved to set up an organisation that would give the human bionics field even greater momentum. Human Bionics Interface (HBI) was born, creating a unique initiative for scientists, investors, researchers and bionics clusters around the world to cross-pollinate ideas, build partnerships and discover new funding sources to rapidly integrate and translate new therapies into practice.

The umbrella goals of the G20 inspired alliance align well with the vision and aspirations of the 11th G20 Summit in China.

President Xi Jinping’s focus on an innovative, invigorated, interconnected and inclusive world economy (G20 Official Site) speaks to

the need to explore new paths and forge closer international economic ties, giving a high priority to innovations in science and technology. For Australia’s Dr Dornan, a guest speaker at Neuroscience 20 (N20+) in Chongqing, “developing an ecosystem to share activities and build partnerships across borders is the best possible way to create agile human bionics projects and unlock the commercial potential of new devices and technologies”.

“What we will achieve through Human Bionics Interface is an interactive environment or living laboratory”, she said, “one that will help to accelerate bionic breakthroughs to help people a whole lot faster. Treatments for neurological disorders like Parkinson’s disease or epilepsy, the creation of brain-computer interfaces e.g. thought-activated bionic limbs, the bionic eye and bionic replacement organs will start to happen much sooner if we all aim to boost our trans-disciplinary cooperation. The probability of improved outcomes for patients and their families and reduced health budgets in all nations will be much higher”.

As the founder and visionary behind Hear and Say Centres in Australia that use the bionic ear to teach many thousands of children to listen and speak, Dr Dornan said, “Greater linkages between human bionics

clusters is especially important to make advances in brain-computer interfaces, neuromodulation devices, bio-fabrication techniques, prosthetics, robotics, organ repair and replacement, neural implants and much more”.

In sharp contrast to the slow growth economy that G20 leaders have wrestled with at this year’s Summit, the bionics sector is a rising star. As much as 700% growth is projected in some bionics fields in just a few short years. In shaping human bionics solutions for future healthcare, Australia’s Chief Scientist, Dr Alan Finkel says, ‘We have left the era of simple solutions. Products offering transformational benefits will derive from the current convergence of science, technology and the internet’. Yet progress in developing bionic devices in many countries is still quite slow. Innovators and clinicians still have very few avenues to learn from each other, to work together and to attract the necessary funds.

Critical in managing previously untreatable conditions are understandings of the complex interfaces between bionic devices and the brain which is the common denominator. The brain and its 86 billion neurones and 100 trillion connections is the most complex entity in the universe with a US$2.5 trillion global economic cost of brain disorders, a figure ›

IN SHARP CONTRAST TO THE SLOW GROWTH ECONOMY THAT G20 LEADERS HAVE WRESTLED WITH AT THIS YEAR’S SUMMIT, THE BIONICS SECTOR IS A RISING STAR. AS MUCH AS 700% GROWTH IS PROJECTED IN SOME BIONICS FIELDS IN JUST A FEW SHORT YEARS.

© The Bionics Institute

› that is only set to escalate in coming decades. In fact it has been said that, “the quest to understand the brain will be the defining feature of the 21st century” (Kunal Ghosh, 2015, World Economic Forum).

Lack of understanding of how the brain functions at every level is still the major obstacle to progress in the bionics arena. The bionic ear, the bionic eye (now well advanced) and bionic spine (to be trialled in Australia in 2017) plus an array of thoughtactivated bionic limbs only function well if a set of accompanying conditions are met.

Scientists must interface the bionic device with an actual human being, and therefore, appropriate brain training must be provided

to the end user. In this regard, professional and family education is not keeping pace. As with cochlear implants, bionic devices do not work if the human brain is not trained to use the technology and here, there is much more to be done.

The bionic spine project, led by Professor Terence O’Brien in Melbourne, Australia (with a team of 39 neurologists and bio-medical engineers from Melbourne University and the Florey Institute of Neuroscience and Mental Health) is a perfect example of the braintechnology interface. The key to the bionic spine is a stent the size of a paper clip that is inserted into the jugular vein and pushed upwards to the motor cortex, the part of the

brain that controls movement. The stent is like a recording device that collects the electrical activity from neurons in the patient’s motor cortex before translating the activity into commands. The transmitter then sends the commands wirelessly to an exoskeleton – or to a wheelchair. The vision through this device is to return function and mobility to patients with complete paralysis.

Dr Babak Kateb, global founder and CEO of the Society for Brain Mapping and Therapeutics (SBMT) and its companion foundation, World Brain Mapping (BMF) who is in China for the N20+(Neuroscience 20+) says the “cost of neurological disorder to the global economy is staggering which demands an innovative solution to this challenge”. Dr Kateb who is convening the N20+ with Dr Yao Lu, a professor of Neurology in Chongqing said his motive in starting the N20 was “to engage scientists, engineers, physicians and policy makers in a global consortium that would integrate nanotechnology, devices, imaging and cellular therapy through a range of partnerships”. Dr Babak is encouraging Human Bionics Interface to collaborate with the N20+ consortium to help shape improved global policies to assist scientists to integrate, translate and more rapidly commercialize advanced bionics devices.

To date, Human Bionics Interfaces has already attracted the attention of bionics clusters and major players in the US, UK, India and China and more are expected to use this new initiative to showcase their clusters and projects and forge new collaborations (between end-users, research institutions, clinicians, industry and government). Figure 1 shows the bi-lateral and multi-lateral links that Human Bionics Interface (HBI) has already established.

The Australian Government and the state of Queensland are passionate about the innovation that biomedical and life science projects brings and are endeavouring to connect research centres and start-up companies with like-minded scientists and investors globally. Queensland as the HQ location of Human Bionics Interface (HBI) is rated fifth in the world for its biotechnology innovation potential and has strengths in genetics/genomic services, bio fabrication, early phase clinical trials and manufacturing of niche pharmaceutical products, medical devices and diagnostics.

Mario Pennisi, the CEO of Life Sciences Queensland who led Australia’s Innovation 20 event in 2014, says there is still a real opportunity to showcase what President Barack Obama referred to as Australia’s

great health discoveries in his landmark address during Australia’s G20. This year, the state of Queensland has released its own future-oriented Biomedical and Life Sciences Roadmap and the goal is to build a bigger club of high fliers in med-tech and bionics. The success of Cochlear Limited (with sales of over 400,000 cochlear implants since the company began trading) has shown that Australia’s new world city of Brisbane (the state of Queensland’s capital city) is a viable location for high technology manufacturing. The therapeutic medicines and devices sub-sector already employs more than 6,000 people in Queensland.

Growing city and country intelligence and supporting knowledge industries (via real and virtual clusters) are undoubtedly very high priorities of Australia’s Turnbull government. In the context of the national innovation agenda led by Prime Minister Turnbull, Human Bionics Interface (HBI) has also spearheaded a Bionics Queensland (BioniQ) group. Cluster participants and future bionics projects are anticipated in several growing regions within the state of Queensland e.g. Greater Brisbane, the Gold Coast, Toowoomba and the Darling Downs and Tropical North Queensland.

The human bionics group in the Greater Brisbane region has already established global linkages. Major contributors to the research and development of new devices and treatments are Professor Mia Woodruff’s biomedical engineering team leading the FutureHear prosthetic ear production project using 3D printing technology), the Queensland Eye Institute’s bionic eye solutions, the Asia Pacific Centre for Neuromodulation, the Queensland Brain Institute’s deep brain stimulation work, the Mater Centre for Neuroscience’s Advanced Epilepsy Unit, Chermside Hospital’s next generation bionic heart and the advanced prosthetics group, Partec. The region has been home to world firsts starting with Cochlear’s bionic ear production and development and more recently the first bionic heart designed by Brisbane engineer Dr Daniel Timms. Last year, surgeons from Prince Charles Hospital in Brisbane joined colleagues from Texas and Melbourne in successfully replacing a sheep’s heart with the device and human trials are set to begin in 2018.

Dr Dornan said, “While we are still building links with emerging and mature bionics clusters in various nations, Human Bionics Interface (HBI) will deliver real benefits to participants. Steve Wozniak, cofounder of Apple Inc. with Steve Jobs said recently that change must happen from the top, and we must learn to speak each

other’s technological language. Leaders need to think like venture capitalists, with a portfolio approach to digital innovation initiatives and build the technology starting with the end in mind. We must take a similar approach now in accelerating human bionics solutions”, she said, “and capitalise on the dawn of this bionic age to enable improved global health”. Already on the horizon are low cost solutions for cancer pain, implantable simulators to gather data to assist drug delivery and the prevention of infection with body implants, bionic bladders and bio-degradable arterial stents.

Australia’s Human Bionics Interface (HBI) is expected to gain even greater momentum in November this year when the 4th International Medical Bionics Conference is held in Brisbane, Australia. Hosted by the Bionics Institute (headquartered in Melbourne), the Brisbane conference is set to attract a number of national and international experts. According to Dr Dornan, new ties and project collaborations with med-tech clusters and bionics institutes visiting from Europe e.g. France and Switzerland will be explored during this event. When Germany stages its G20 in 2017, it is likely that Human Bionics Interface (HBI) will further extend these European links and establish new connections with cluster leaders and investors in North America, China and India. In the meantime, HBI invites G20 healthcare leaders, interested clinicians, researchers, device manufacturers and bionics investors to access the website (www.bionicsqueensland.org.au/ hbi) and contact Dr Dimity Dornan directly (dimity.dornan@hearandsay.com.au) to discuss how HBI can showcase their cluster, enterprise or project and open the door to new collaborations. ■

Dr Robyn Stokes is an Australian business strategist and foundation member of Bionics Queensland. Twitter: @brisrobyn

LAST YEAR, SURGEONS FROM PRINCE CHARLES HOSPITAL IN BRISBANE JOINED COLLEAGUES FROM TEXAS AND MELBOURNE IN SUCCESSFULLY REPLACING A SHEEP’S HEART WITH THE DEVICE AND HUMAN TRIALS ARE SET TO BEGIN IN 2018.

Dr Dimity Dornan

Founder of HBI and Hear and Say

© The Bionics Institute

Unlocking SME Potential for Inclusive Economic Growth

In September 2016, the G20 Leaders meet in Hangzhou, China, at a time of increasing volatility in global markets and political uncertainty. Across G20 economies and beyond, there is a pressing need to unlock growth, investment and jobs. Most of all, there is a strong call for inclusive economic growth. Unlocking small- and medium-sized enterprises (SMEs)’ potential remains one of the best opportunities to achieve all of that.

SinceSeptember 2015, when the G20 leaders welcomed the World SME Forum (WSF) as the international organization which amplifies the voice of SMEs globally, we have been in intense dialogue with partners around the world to identify the most pressing priorities of the SME community. The feedback we are getting is that, in 2016, traditional challenges to SME growth have been intensifying: they include constraints in accessing markets, finance, managerial and entrepreneurial skills.

And, if these are not sufficient to completely debilitate the typical SME, business regulations often place them at a disadvantage. The fact of the matter is that obstacles to entry, high costs of compliance, the absence of a level playing field, and low transparency are hindering SMEs’ potential across the board.

Yesterday’s issues are still today’s issues, and not because of lack of effort in the Development and the Business Community, but because it is a really tough problem to solve. We are faced with the slowest post-crisis

investment recovery since the early 1970s, and SMEs – which account for the majority of employment and over half of value-added in OECD countries – are struggling to access the financing they require to participate in and across world markets, as banks have deleveraged to meet new regulatory requirements.

Still, the situation is not as bleak as it may appear. There are at least two specific opportunities at hand. Globally, policymakers have indeed turned their attention to SMEs as

Authored by: Dr. Tunc Uyanik

a potential recipe for inclusive growth; and digital technologies are providing SMEs the potential to compete in international markets at levels unseen before.

The first opportunity rests on reinforcing the sharper focus on SMEs that has come of late. It’s an opportunity not to be missed. SMEs have become an explicit focus for sovereigns as well as prominent international organizations such as the OECD, the World Bank Group, the International Trade Center and the WTO. This year B20 China decided to continue the work of the SME Development Taskforce, which was started for the first time by B20 Turkey, hopefully making it a mainstay for B20s and G20s to come. For our economies to have healthy inclusive growths, SMEs must remain as a key priority in the B20 / G20 process and across Presidencies.

The second opportunity rests on infusing digital technologies into the DNA of SMEs. We know that technology is facilitating access to markets; e-Commerce now enables firms to link to an unprecedentedly large customer base, at significantly lower interaction costs. Digitization facilitates access to finance in unconventional ways: by improving credit

information and analysis through online data sources such as sales and other performance indicators; through alternative finance such as crowdfunding and supply-chain finance; and fintech innovations targeted to help SMEs on payments. Technology is also facilitating access to skills, through Massive Open Online Courses (MOOCS), or free online learning modules, which are making learning and mentoring easier and more affordable than ever before for smaller companies.

The proceedings on the China B20 SME Development Taskforce are following in the path of last year’s recommendations, with a focus on SMEs access to GVCs, finance, digital trade, and a better regulatory environment, but they took a sharp welcome turn towards accountability and implementation, focusing on both the existing opportunities and the challenges ahead. The recommendations are practical and reasonable, and they provide a concrete roadmap that G20 governments can implement to offer a tangible boost to SME Development, in turn supporting much needed job creation and inclusive economic growth in both developing and developed economies.

The recommendations have a broad reach: they include concrete considerations about the creation of an innovative Electronic World Trade Platform (eWTP) to incubate eTrade rules and foster a more effective and efficient policy and business environment for cross border electronic trade development; the development of coordinated capacity building and certification programs to facilitate the inclusion of SMEs in Global Value Chains; the facilitation of SMEs’ access to bank finance and alternative funding; and finally the improvement of SMEs regulatory environment, through a reduction of compliance costs and a significant improvement of access to public procurement markets, especially through the digitalization of Government processes.

It is important that G20 leaders pay good attention to these recommendations, as it is in their best interest to lift SMEs’ growth, and with them their whole economies. More broadly, it is essential that G20 continue its support to SME growth by ensuring that countries strengthen their focus on the SME agenda, now and in the coming years, starting with 2017 Germany G20.

The opportunities to better utilize the enormous potential of SMEs to help the world economy to overcome many of its current challenges are already here. We just need to ensure that policy helps SMEs to help themselves. ■

Dr. Tunc Uyanik joined World SME Forum (WSF) as its founding CEO in November 2015. He was previously the Special Envoy and Chief Adviser to the President of TOBB and B20. He was also the Chair of the Turkish B20 Steering Committee.

Prior to this, Dr. Uyanik was the Director of the Financial and Private Sector Development Department in East Asia and Pacific Region at the World Bank, as well as the Director of the Financial Systems Global Practice. He was also co-chair of the Financial Sector Liaison Committee (FSLC) and chair of the World Bank’s Islamic finance working group. Dr. Uyanık has vast experience in: financial and private sector development, financial sector policy and regulation; financial sector assessment and reforms, banking sector restructuring, lines of credit and guarantees; financial inclusion, asset recovery and asset management.

YESTERDAY’S ISSUES ARE STILL TODAY’S ISSUES, AND NOT BECAUSE OF LACK OF EFFORT IN THE DEVELOPMENT AND THE BUSINESS COMMUNITY, BUT BECAUSE IT IS A REALLY TOUGH PROBLEM TO SOLVE.

Authored by: Dr Oleg Preksin

The New Dimensions for the Great Silk Road

All of Eurasia should become the territory of accelerated growth and sustainable development could be secured by the rational combination and prudent use of its enormous natural resources, production assets, scientific and technical potential, financial and human capital from East and West, North and South.

Thealmost two-year-old commitment of global leaders “to lift the G20’s GDP by at least an additional two percent by 2018” (G20 Leaders’ Communique. Brisbane Summit, 15-16 November 2014), even backed by the 2016 Summit priority “to build an innovative, invigorated, interconnected and inclusive global economy and explore new ways to drive development and structural reform” (message from President Xi Jinping on 2016 G20 Summit in China), is becoming difficult to perform. “In an era of peril and many challenges…times of turmoil” (UN Secretary-General Ban Ki-moon’s Remarks at the St.Petersburg International Economic Forum, 16 July 2016), divergent economic development and exhaustion of the old sources of growth, ongoing trends towards fragmentation of foreign trade and investment

The Silk Road

market, geopolitical tensions and uncertainty, the implementation of the above commitment requires a proactive search for new drivers of global growth and integrity. One such driver is the Chinese One Belt –One Road (OBOR) initiative, which has met with great attention and broad support almost everywhere.

The OBOR official concept, released in March 2015 by the China’s top economic planning agency—the National Development and Reform Commission and the Ministries of Foreign Affairs and Commerce of the PRC and titled “Vision and Actions of Jointly Building Silk Road Economic Belt and the 21st-Century Maritime Silk Road”, provides a great deal of creativity and flexibility to all the interested parties. The framework character of this document with minimum details and clear declaration that OBOR is open to all nations

and not limited geographically is explored by various stakeholders, promoting their vision of this mega-project.

For example, the Silk Road Chamber of International Commerce (SRCIC), founded in Hong Kong last December “to renaissance the Silk Road and to enable business participation in the investment and trade opportunities it offers”, brought together high level representatives from 39 countries as founding members and is now creating five organizations to work within the OBOR initiative. These are the eSilkRoad, Silk Road International Development Fund, Silk Road Think Tank Association, Silk Road Commerce and Trade Exposition Park and the International Silver Exchange Center. All five are supposed to form integral parts for the Chinese initiative, providing a brand new ›

AN EXTENSIVE NETWORK OF TRANSPORT CORRIDORS AND OTHER LOGISTIC FACILITIES ON THE WHOLE TERRITORY OF EURASIA SHOULD FORM THE BASIS FOR TEP PROJECT.

› platform for interactive connectivity and financial services for ‘Belt and Road’ construction, becoming “the decision-making references for industry development and project cooperation”, an instrument to boost cross-border commerce and improve the real economy.

One can also see different OBOR versions like the New Great Tea Road—modern replica of another caravan route from China to Europe in the XVIII-XIX centuries, which passed through the territory now belonging to Mongolia and covering most of Russia. Tea Road was in the same row with jade, salt, cinnamon, tin and wine routes, and was second only to the Great Silk Road in the terms of turnover.

The OBOR concept is actively discussed between China and Russia. The leaders of the two states reached consensus on tapping cooperation potential and advantages, intensifying bilateral ties in energy, high-speed railway and infrastructure, aerospace and aviation, manufacturing and agriculture, investment and finance and other fields. Both sides agreed to reconcile the construction of the Silk Road Economic Belt (SREB) and the Eurasian Economic Union (EAEU), and to coordinate the development with other members of the EAEU and the Shanghai Cooperation Organization (SCO). The recent decision on accession to the latter of India and Pakistan increases the SCO population to

almost half of the global. It’s probably needless to enumerate all the resources of SCO and EAEU countries but worth to mention that both organizations are open to new members who share their fundamental principles.

The SCO decision on the accession of India and Pakistan and simultaneous Brexit referendum results indicate the existence of dual trends in Eurasia—for integration and disintegration. This shows the importance of an attractive and reliable platform for the idea of a Single Economic Space from Lisbon to Vladivostok and from Helsinki and Arkhangelsk to Singapore and Mumbai as well.

The Trans-Eurasian Partnership could be the proper platform for an idea that covers the OBOR initiative and all its core elements in the upgraded mega-project. Together with the already signed Trans-Pacific Partnership (TPP) and still planned Transatlantic Trade and Investment Partnership, (TTIP), the Trans-

Eurasian Partnership may form some kind of a Transcontinental Development Belt. The Trans-Eurasian Partnership (TEP), built by the EAEU and SCO existing and new members, by other countries in Asia and Europe, including the EU, as well as the promoted Greater Transcontinental Development Belt (GTDB), linking TEP with TPP and TTIP, is an alternative to the attempts to monopolize the benefits from the technologies of next generation, to create the barriers for the flows of the breakthrough innovation to other territories, with rigid control over the cooperation chains for the maximum extraction of technological rent.

An extensive network of transport corridors and other logistic facilities on the whole territory of Eurasia should form the basis for TEP project. The creation of such a network provides not just to upgrade the infrastructure for the ease of communication, but to secure an inclusive and well-balanced development in different areas. And one of the main routes in the new Eurasian transport network will become the high-speed Moscow-Beijing transport corridor with its sequels to Baltic, Atlantic and Mediterranean states in the West and to Pacific, South and South-East sia countries on the other side. The 770-km Moscow-Kazan high-speed railway segment of this particular route, designed for bullet trains capable of running at up to 400 km per hour - the pilot Russia-China joint construction

TO ENSURE THE PROPER FINANCIAL SUPPORT FOR THE TEP MEGA-PROJECT, NOT TO MENTION THE GTDB, EVEN THE RESOURCES OF THE US$40 BILLION SILK ROAD FUND WILL NOT BE ENOUGH.

Transcontinental Development Belt

project, presumably will be followed by other with various participants and different configuration. The land route from Asia to Europe is much shorter than any by sea (and Russia is able to offer the shortest route possible in both cases), but considerably more expensive. And it’s worth to mention, that the existing Trans-Siberian Railway (TSR) utilization ratio reached 100% (that is used to deliver cargoes from Shanghai to Brest and further to the EU). In contrast the utilization ratio of the other main land route going to Europe through Kazakhstan, Central and European part of Russia the experts estimate to be less then 25%. (Eurasian Development Bank Working Paper)

Full use of the central line of Trans-Eurasian transport and logistics corridor does not preclude the construction of its northern and southern branches that may be also commercially valuable. One of such branches— China-Mongolia-Russia Economic Corridor— involves the implementation of about 30 projects agreed by all three parties on the sidelines of the SCO June summit in Tashkent.

It is valid to ask: how can such projects and programs be funded? Who is able to support financially TEP and GTDB mega-initiatives?

The answer lies in the field of public-private partnership (PPP), in its development in all forms and at any level: national, regional or global. First of all, it’s worth to apply to conventional long-development banks and similar institutions, as well as to the new ones, such as the Asian Infrastructure Investment Bank (AIIB) or the BRICS New Development Bank (NDB). Each of these two has the authorized capital of US$100 billion. The AIIB, where China, India and Russia are the main shareholders, is going to expand its membership from 57 to nearly 100 countries and regions by the end of this year. With co-financing from the World Bank (WB), the Asian Development Bank (ADB) and the European Bank for Reconstruction and Development (EBRD), the AIIB approved this June the first loans for about US$500 in total. NDB is also working on its first block of projects, although the development of project finance in the PPP format, that is inevitable with growing budget constraints, is yet to come for both banks.

To ensure an adequate financing for the project of TEP and GTDB magnitude, it’s worth to replenish conventional fund rising with some special purpose vehicle (SPV). And the construction and exploration in the late XIX—early XX century of the Chinese Eastern Railway (CER), also known as the Chinese Far East Railway and Manchurian Railway, might provide some useful experience, given the

today’s realities.

In the harsh conditions with participation of foreign capital, mainly French and German, CER JSC implemented unprecedented for its time multimodal infrastructure project, which eventually became profitable. The line provided a shortcut from the world longest TSR near the Siberian city of Chita via Harbin (CER built capital) to the Russian port of Vladivostok with outputs to Beijing, Seoul and other major cities. In addition to the large areas received used under long-term concession and known as the CER Zone and the rolling stock, CER also had built its own fleet and conducted regular maritime shipments to Japan, Korea and Chinese costal cities. To finance its development CER has arranged about 20 bond issues that were acquired by the government, but also placed on the markets outside Russia.

To ensure the proper financial support for TEP mega-project, not to mention the GTDB, even the resources of US$40 billion Silk Road Fund will not be enough. Loans and investments from the existing development banks are also of a limited application. So it’s worth to consider the possibility of establishing as SPV specialized mega-fund, that may issue international bonds with partial state guarantees, and to register a major management company, inviting world known financiers and entrepreneurs with an impeccable reputation to its Board. The fund with the management company could be domiciled in one of the leading international financial centers, for example in Hong Kong or Singapore. And the SPV issued bonds may be convertible into the shares of financially supported projects.

The leading partners for TEP are expected to be not only the EAEC, SCO and BRICS states and their business circles, but also the investors from Japan, South Korea and South East Asia, from Western Europe (Germany, France, Italy, for example) and probably from North America – all who cares of Eurasia.

Speaking in June at the St. Petersburg International Economic Forum (SPIEF), the UN Secretary-General Ban Ki-moon stressed “the critical importance of further economic integration and cooperation in this region. At the moment, however, we see countries breaking ties and building new barriers. History tells us that this is not the right direction for Europe. We need to strengthen ties and build bridges, instead of building walls”.

All of Eurasia should become the territory of accelerated growth and the sustainable development could be secured by the rational combination and prudent use of its enormous

natural resources, production assets, scientific and technical potential, financial and human capital from East and West, North and South. This is the very sense and the main point in TEP and GTDB mega-projects, which should remain open for accession by all the interested parties. “Let’s work together to make this world better” (Ban Ki-moon’s Remarks at the SPIEF, 16 July 2016). ■

Dr. Oleg Preksin B20 Sherpa for Russia in 2012-2015 is now a member of the B20 Financing Growth and Trade & Investment Taskforces.

Vice President of the Association of Russian Banks (ARB) with an extensive banking experience in Russia and abroad. The first Russian director in the EBRD Board, also representing Belarus and Tajikistan. The founding member of the SPIEF Organizing Committee, a member of the Coordinating Committee of the Financial & Banking Association for Euro-Asian Cooperation and of the Eurasian Economic Commission Working Group for the EAEU Integration Mainstream.

Hangzhou. Silk

European Inspiration: Perfected in the Caribbean

Locatedin the exclusive private community of Cap Cana at the eastern tip of the Dominican Republic, Eden Roc at Cap Cana, the only Relais & Châteaux hotel in the island, consists of 34 freestanding suites with private pools and offers amenities such as a full service spa, a Jack Nicklaus Signature Golf Course located nearby, private Beach Club, Koko Kids Club, four diverse culinary selections, 753 square feet of meeting space at Corallina Conference Room and various multi-purpose spaces ideal for destination weddings and corporate functions.

Fusing the best of form, function and fantasy, the extraordinary resort is surrounded by lush greenery and aweinspiring panoramas, while each suite’s sprawling decks serve as a natural extension of the airy spaces. With views of verdant gardens and lagoon-style pools, Eden Roc at Cap Cana has already become one of the most coveted resorts in the area.

Each dynamic, light-filled suite radiates a sense of calm that comes from their inimitable spatial equilibrium. With private swimming pools and massage/relaxation areas, the ambiance exudes the most exclusive experience. Additionally, each suite is equipped with cutting-edge Bose audio systems and iPads that have innovative apps to control the lighting, sound system, and TV.

Envisioned by Milan based designer, Marina Nova, Eden Roc at Cap Cana is fashioned more after a luxe village than a traditional resort. Opened in December 2012, Eden Roc at Cap Cana celebrates the aesthetics of the 1960s French and Italian

Rivieras through its stunning design, the resort’s stunning design celebrates the aesthetics of the 1960s French and Italian Rivieras, while also being both respective and reflective of its Caribbean setting.

Blending European influence and Caribbean spirit, each suite is drenched in vibrant colors such as cerise, golden yellow, azure, plum and lime green, providing a stark contrast to the soothing cream and eggshell palate of the interior spaces. The premium coral stone and hand-painted tile flooring complement these inviting colors. Two specialty villas to note include the Three Bedroom Royale Villa and Four Bedroom Imperiale Villa.

Eden Roc at Cap Cana’s four inspired dining establishments feature a variety of haute cuisine. Each restaurant comes to life with a distinctive personality through a combination of striking décor and elegant atmosphere. The most elegant venue is Mediterraneo, which menu exudes a journey of flavors and ingredients from Mediterranean cultures, and blends local elements with specialties flown in from artisanal suppliers in Europe. Located at the Eden Roc Beach Club is La Palapa by Eden Roc, featuring seafood prepared to perfection and sumptuous gnocchi, among other tantalizing plates. La Cava, featuring a charming domed roof made of bricks is a charming gathering spot that feels like a cozy cellar in a historic hacienda but has been designed for today’s wine connoisseur. Finally Riva Bar, inspired by the exquisitely crafted Riva Aquarama pleasure boat that was the symbol of glamour in 1960s Monte Carlo, is Eden Roc at Cap Cana’s vintage bar locale.

During winter 2016, Eden Roc Beach Club will reveal a new dining destination highlighting a display of Nikkei and Robatayaki cooking techniques for dinner, featuring a cigar cellar, wine showcase, and a rotisserie by the pool serving grilled staples for lunch.

Eden Roc Beach Club offers a fashionable and fun setting to enjoy the natural pleasures of sun, sea, sand as well as the more urbane pursuits of fine dining, spa and wellness, and shopping. Accessible only by guests of Eden Roc at Cap Cana hotel and members, the Beach Club provides an intimate setting to

connect with loved ones, new friends and yourself.

The Solaya Spa is a haven of calm where native healing philosophies and contemporary technologies blend seamlessly to deliver experiences that will nurture the body, soothe the mind and energize the spirit. Capturing the rejuvenating aura of this Dominican paradise, the Spa offers a wide range of opportunities to find beauty, balance and complete well-being.

With 753 square feet of meeting and event space, Eden Roc at Cap Cana also feature

Branded Story / Eden Roc at Cap Cana

EDEN ROC BEACH CLUB OFFERS A FASHIONABLE AND FUN SETTING TO ENJOY THE NATURAL PLEASURES OF SUN, SEA, SAND AS WELL AS THE MORE URBANE PURSUITS OF FINE DINING, SPA AND WELLNESS, AND SHOPPING.

various multi- purpose spaces evoking an eclectic array of ambiances ranging from intimate decadence to modern minimalism ideal for destination weddings and corporate functions. The resort houses an expert staff of event planners and caterers offering unparalleled attention to detail and topnotch customer service.

The Koko Kid’s Club is enjoyed by the young and young at heart. Located on a lagoon, it resembles a massive tree house equipped with video games and even a mini- spa where the girls can have manicures,

pedicures and style their hair. There is also an inviting central area for playing and story-telling.

About Eden Roc at Cap Cana Eden Roc at Cap Cana is a five-star resort nestled in the exclusive, beachfront community of Cap Cana at the eastern tip of the Dominican Republic. The 30,000-acre community is home to pristine beaches, towering cliffs and tropical forests, as well as a Jack Nicklaus signature golf course and bustling marina. Blending the impeccable standards of the French and Italian Rivieras with the warmth and relaxed charms of the Caribbean, Eden Roc at Cap Cana lavishes guests with remarkable comforts, amenities and beachfront scenery. In addition, the resort boasts a newly-renovated Beach Club, infinity pool and Solaya Spa. Culinary experiences include fine-dining Mediterraneo Restaurant with Executive Chef Gianluca Re Fraschini at the helm; and oceanfront La Palapa by Eden Roc featuring international cuisine with traditional local influence. The resort will reveal a new restaurant and expanded spa in Winter 2016. The AAA Four-Diamond property is a proud member of the prestigious Relais and Châteaux collection, as well as

About Relais & Châteaux

Relais & Châteaux is an exclusive collection of over 520 of the finest charming hotels and gourmet restaurants in 60 countries. The prestigious family of hoteliers and Grands Chefs from around the world shares a passion and a personal commitment to ensure that customers are aware of moments of exceptional harmony, an unforgettable celebration of the senses. ■

For more information about Eden Roc at Cap Cana Boutique Suites & Beach Club, please call (809) 469-7469 or visit www.edenroccapcana.com

Hangzhou. China

Virtuoso Hotels & Resorts, Ensemble Travel Group, Altour Hotel Collection, Fine Hotels & Resorts, Signature Travel Network, the International Association of Golf Tour Operators and Forbes Travel Guide.

The Next Generation in Decking

Whilemany composite lumber manufacturers are focused simply on creating a beautiful backyard, Advanced Environmental Recycling Technologies (A.E.R.T.), Inc. has taken this beauty a step further with its environmentally friendly composite decking, MoistureShield. MoistureShield composite deck boards are made with more than 95% recycled content and not only create a beautiful backyard, they keep the environment beautiful by conserving resources and helping to prevent discarded plastics from ending up in landfills.

Taking Green Seriously

A.E.R.T. is a leading plastics recycler and manufacturer of green composite building products. Its state of the art 70,000 squarefoot plastic recycling facility washes, cleans and separates polyethylene food packaging and wrapping films for the raw materials in MoistureShield decking products. Even the building itself is designed with LEED certifications, with no storm water discharged from the site and no potable water used in the manufacturing process. The energy efficient design includes a habitat for protected species and low emissions. A.E.R.T. was even awarded with the U.S. Environmental Protection Agency’s EPA Region 6 “Partnership for Environmental Excellence” Award.

The International Code Council Evaluation Service (ICC-ES) verifies MoistureShield decking products contain 95% total recycled content – 57 percent from pre-consumer sources like packaging films and waste pallets and 38 percent from post-consumer sources like used grocery bags and milk jugs. Using these recycled sources, to manufacture MoistureShield no new trees are cut down which conserves the environment. Due to its high percentage of recycled content, MoistureShield decking products can also help earn credit in green building rating programs like LEED®.

Eco-Friendly meets High Performance MoistureShield products do not sacrifice performance for their eco-friendliness though. Their durable composite decking is the perfect combination of nature, design and quality. For over 25 years and counting, MoistureShield has never experienced field failure due to rot, decay or delamination. They even protect their products with the industry’s leading Transferable Lifetime Warranty.

Weather wreaks havoc on unprotected wood, and even pressure treated and hardwoods can be subject to performance issues. Whether from rain, snow or humidity moisture absorption in decking can cause problems like swelling, cupping, splitting, and fastener shearing. On top of that, UV radiation from the sun can break down the lignin that holds the wood’s cellulose fibers together causing the wood to gray and leaving it unsafe and unattractive.

MoistureShield’s innovative patented method to fully coat wood fibers with plastic, results in decking that is so moisture resistant it can be installed on the ground, in the ground or even underwater without being damaged. These premium composites are also available in a variety of natural wood tones and finishes to mimic the beauty of a high end wood deck while offering the durability of a composite. Easy to clean and simple to install, MoistureShield’s newly expanded family of durable outdoor living products offers the right options to fit any decking application.

Hidden fastener systems

Sometimes it’s what you don’t see that makes a deck beautiful. Hidden fasteners are becoming increasingly popular with both homeowners and deck builders. Homeowners like the clean, smooth surface provided by hidden fasteners, and clips installed with pneumatic fasteners can install 3 to 4 times faster than traditional surface fasteners. It’s a win-win for builders: they reduce labor

time while providing customers with a more attractive deck.

MoistureShield Deck Clips provide superior holding power, with a custom design that fits securely into the grooved profile of a MoistureShield board. Like our composite decking our clips are both beautiful and durable, extending the life of the deck by elevating the boards off the joists to reduce structural rot and mold.

In independent laboratory testing, the MoistureShield Deck Clip tested at 391 foot pounds to the first movement versus the competitors’ fastener that averaged 274 foot pounds meaning that they can deliver 42.7% greater lateral movement resistance.

In regions with wide daily temperature swings this extra holding power keeps decks from “walking” and loosening creating stronger and longer lasting fastening. They’re even backed back a limited lifetime warranty against any loose deck boards.

MoistureShield Composite Decking has a sustainability advantage that most other manufacturers do not: more than 95% recycled content.

Branded Story / AERT Moisture Shield

Deck lighting

In a survey conducted by the American Society of Landscape Architects (ASLA) of outdoor living trends, 98% of landscape architects ranked lighting number one among 18 different outdoor living features requested by homeowners. Outdoor lighting even came out ahead of other perennial favorites like grills and outdoor furniture.

To accommodate this growing demand, MoistureShield recently released a full line of deck lighting that can enhance any deck design. MoistureShield Deck Lights are designed to work with the company’s composite decking products to add elegance and safety to outdoor living areas. The new product line includes options for energyefficient recessed “bullet” lights, under rail strip lights, stair lights and two styles of post lights. Accessories include 3 and 5 amp transformers, wire and a drill bit sized for the bullet lights. The lights are protected by a 5-year warranty when installed

with MoistureShield light accessories.

“More people are enjoying spending time on their decks in the late evening hours, so adding lighting is a natural addition to MoistureShield’s full family of products,” said Brent Gwatney, Sr. Vice President of Sales & Marketing for MoistureShield. “Lighting is a great way to create visual drama and to help people stay safe, especially around stairs.”

Specialty railing

With the growing popularity of high-end, well-designed outdoor living oases, homeowners are demanding railing that is attractive and not just functional. New railing designs are featuring clean, sleek lines complementing the outdoor space instead of obstructing it.

MoistureShield Pro Aluminum Railing features sophisticated, modern lines that enhance any outdoor setting. Since it’s sold in kits and supplied with installed baluster connectors and ergonomic rail brackets,

enhancing a deck or patio with MoistureShield’s Pro Railing is simple. Not only is the flat-top, drink-friendly rail easy to install, but the strong corrosion resistant aluminum alloy is finished with a durable powder coated paint that will retain its color for years to come. It’s even backed by MoistureShield’s industry leading Limited Lifetime Warranty and a 15-year Paint Warranty. The contemporary design and easy-to-maintain materials complement the entire MoistureShield line of high-performance composite decking and illuminating deck lights, making it the perfect railing choice to enhance any backyard. ■

Find out more about these unique composite decking products and outdoor living accessories at moisureshield.com.

AERT Moisture Shield

© 2015 Advanced Environmental Recycling Technologies, Inc. All trademarks are property of Advanced Environmental Recycling Technologies, Inc., unless otherwise noted. All rights reserved.

Indoor Air Quality: A Global Concern

Itis well-known that air pollution is a serious threat to the environment. The quality of ambient (outdoor) air has been diminishing consistently since the Industrial Revolution brought on a colossal influx of fossil fuel burning. The shift away from agrarian economies was soon followed by the advent of motor vehicles and they’ve been adding to the assault on the atmosphere ever since. We may sometimes feel overloaded by these facts - specifically in the context of climate change – but it’s too serious to ignore. Crop yields have declined in multiple regions since 1980 due to smog, black carbon, and ground-level ozone. This is akin to a nuclear winter, when the air is too thick for sufficient light to reach plants. This stunts agricultural output which is a tangible threat to food security.

Air pollution is taking an enormous toll on human health as well. The most recent figures from the World Health Organization (WHO) state that one in eight global deaths were the result of air pollution in 2012. This is more than twice the amount previously believed by the scientific community so air pollution is now the leading health risk from the environment. The dramatic doubling of these figures is due to a new understanding of pollution’s role in the development of diseases such as cancer. Scientists have also gained insight into the way in which outdoor and indoor air pollution work in tandem, deteriorating health.

Not typically addressed but arguably more critical – the quality of indoor air is significantly worse than the air we encounter outside. The United States Environmental Protection Agency (EPA) estimates that indoor air can have two to five times more pollutants than outdoor air but the levels of certain contaminants can be one-hundred times higher. In many parts of the world, people spend up to 90% of their lives indoors. Compromised indoor air quality is a problem we all share in our biosphere due to a combination of factors - regardless of geographical region or socioeconomic status.

On one end of the spectrum, there are almost three billion people who rely on solid fuels and open fires to cook their food and heat their homes. The burning of wood, dung, and coal releases hazardous smoke and fumes into the home including particulate matter less than 2.5 micrometers (PM2.5) in diameter. PM2.5 is roughly 1/30th the width of the average human hair and can embed deep into the lungs when inhaled. Levels of PM2.5 can be up to twenty times higher than the accepted values in homes where biomass fuels are burned.

Short-term exposure to PM2.5 has been shown to cause health problems ranging from coughing to shortness of breath. Long-term exposure increases risk of heart attack and stroke. A recently published study by the Harvard School of Public Health showed an association between autism spectrum disorder and regular contact with high levels of particulate matter during pregnancy, especially during the third trimester. Newborns exposed to high levels of PM2.5 are more likely to contract pneumonia, the leading cause of death for children under the age of five.

In contrast to other quality of life indicators such as access to clean water or nutritious food, indoor air isn’t necessarily better in “modern” homes which use gas or electricity for heating and cooking. Improvements in construction have made buildings more energy efficient than ever – tightly sealed lodgings lock out wind, rain, and snow but also trap dangerous particulates and chemicals inside. Everything from furniture to paint is known to off-gas volatile organic compounds (VOCs) and other chemicals such as formaldehyde, a known carcinogen. VOCs can cause eye irritation and cold symptoms but have also been linked to brain damage and cancer.

The lack of natural ventilation in newer buildings plus their components has resulted in chemical and particulate saturated air. This is best exemplified by sick building syndrome (SBS). The term, coined by the WHO in 1986,

is the phenomenon of non-specific poor health among the people who occupy a building which appears to be linked to their time spent there. With rapid economic growth transforming many of the world’s economies, more and more people are living and working in newly built structures. SBS is an increasingly prevalent occupational hazard resulting in an upsurge of sickness related absences and a decline in productivity which isn’t likely to recede soon.

The amenities that accompany newer buildings aren’t the only improvements which have come at a cost. The past century has seen a drastic rise in severe asthma and allergies in industrialized nations. The hygiene hypothesis states that the jump may be related to strides in medicine, primarily treatments for infectious diseases. Lack of exposure to parasites, symbiotic microorganisms such as gut flora and probiotics, and other infectious agents, which have co-evolved with humans and potentially strengthen the immune system may have increased our sensitivities to certain compounds.

For example, Immunoglobulin E (IgE) is an antibody present in all humans. IgE causes allergic reactions when it confuses innocuous items like dust, pet dander, and pollen with harmful intruders. IgE most commonly causes allergic rhinitis (inflammation of the nose) which results in nasal drip, sneezing, itching, and congestion. Asthma attacks can also be spurred by IgE-based irritation. Typical triggers for allergy symptoms often cause asthma attacks as well. The two conditions

Outdoor air pollution is often in the spotlight while indoor air quality is rarely on our radar; at Austin Air we worry about it so you don’t have to.

frequently happen in tandem in patientsan estimated four out of five asthma sufferers also have allergic rhinitis. Poor ventilation, chemical vapors, and PM2.5 all exacerbate asthma and allergy symptoms.

No matter whether one lives in a simple, single room dwelling or in a state-of-the-art home with the advances of modern medicine, poor indoor air quality is a major concern and difficult to improve but Austin Air has been on the front line of the fight for clean air for the past three decades.

Inspired by a family member with debilitating respiratory problems, Austin Air founder Richard Taylor began doing research on the causes of asthma attacks in the late 1970s. By 1979, he was convinced that invisible air particles were a major culprit in asthma attacks. At the time, there was no proven prophylaxis to stop asthma attacks. The only treatments were harsh drugs with a

laundry list of side effects including dizziness, insomnia, diarrhea, nausea, vomiting, dry mouth, arrhythmia, headaches, tremors, and more.

By 1982, Taylor had designed and manufactured the first High-Efficiency Particulate Air (HEPA) filter for the consumer market. Improvements were made over the next few years to maximize filter surface area, cut energy costs, and address a wider spectrum of indoor air contaminants. In 1990, Austin Air Systems, Limited was founded in Buffalo, New York, USA, introducing the first air cleaner specially designed to help people with suppressed respiratory function from asthma, allergies, and chronic obstructive pulmonary disorder (COPD).

Austin was the first company to combine HEPA filtration with solid activated carbon, increasing the adsorption surface area to over 1360 acres (550 hectare). For perspective

Austin Air

- the entire walled in area of the ruins of the ancient city of Ephesus is 1030 acres (415 hectare)! Austin was also the first to incorporate zeolite to capture ultra-fine gas molecules. In 1999, Austin Air introduced High Efficiency Gas Absorption (HEGA) cloth filters to the consumer air purification market. HEGA was originally developed for the British military to defend against chemical warfare. It’s extremely efficient at absorbing gaseous pollutants such as formaldehyde, ammonia, toluene, and benzene. Austin Air’s groundbreaking innovations quickly garnered the attention of various public and civil entities.

Austin was commissioned by the US Government to develop proprietary air cleaners to tackle fumes from oil field fires abroad. The Federal Emergency Management Agency (FEMA) and the American Red Cross chose Austin Air products to limit exposure to airborne and chemical toxins following the September 2001 attacks in New York City. Austin products were later chosen to protect citizens living in close proximity to the chemical storage depot in Anniston, Alabama during the mass incineration of Cold War-era chemical weapons.

Austin Air products have also been solicited for a multitude of clinical trials. In the largest study of its kind, Cincinnati Children’s Hospital tested the Austin Allergy Machine which showed a statistically significant reduction in emergency room visits of asthmatic children. Johns Hopkins University conducted a study which proved that the Austin Bedroom Machine efficiently reduces nitrogen dioxide resulting from gas stove use. The results of this study were so promising the researchers were inspired to further study the efficacy of Austin products in three on-going clinical trials.

Although respiratory health issues do not plague everyone, particulates and the increasing presence of harsh chemicals and VOCs make the matter of indoor air quality relevant to us all and must be taken into consideration. Austin Air has been a pioneer in air filter technology since Mr. Taylor started tinkering in the 1970s. Austin products continue to prove their wide range of impact not only on indoor air quality but also on the overall quality of life of their owners. ■

Hangzhou. China

Find out more about this product contact Austin Air on: 1-800-724-8403 austinair.com THAT ACCOMPANY NEWER BUILDINGS AREN’T THE ONLY IMPROVEMENTS WHICH HAVE COME AT A COST. THE PAST CENTURY HAS SEEN A DRASTIC RISE IN SEVERE ASTHMA AND ALLERGIES IN INDUSTRIALIZED NATIONS.

Russia and China Join Forces to Develop Green Energy

Despite the fact that Russia is one of the world’s largest exporters of oil and gas, in recent years the country has actively been developing alternative energy. Experts say that China, which is interested in inexpensive energy supplies from Russia’s Far East, is giving Russia a hand.

InJuly 2016 the new BRICS Development Bank, which was created on the initiative of Russia, China, Brazil, India and South Africa as an alternative to the International Monetary Fund, issued its first “green bonds.”

The total value of the bonds was three billion yuans ($448.5 million), and the money received will go towards the realization of ecological projects, including alternative energy. This is not the only example of cooperation between Russia and China in this field. Chinese companies are increasingly investing in the construction of Russian solar and wind power stations.

“The whole world is placing bets on better ecology, and the BRICS Bank is no exception because member countries also have ecological problems,’’ said leading expert at Finam Management, Dmitri Baranov. ``Therefore, the bank’s decision is logical. Its resources can help solve a part of these problems by improving the ecological situation, including the one in Russia.’’

Deep Roots

Russia has deep roots in alternative energy. The country’s first hydroelectric power plant appeared in 1892, in Siberia’s Altai region, and produced electricity with four wooden turbines, each with a 45 kilowatt capacity. In the 1930s the USSR was first in the world to make wind generators, and in the 1960s the country produced the first power stations using geo-thermal energy from the Earth. Today, about 17 percent of all energy in Russia is produced from alternative sources. However, for a long time the country lacked state programs to support alternative energy. Such a program was introduced only in 2013.

According to the program, by 2024 an

approximate total of 1.5 gigawatts of solar stations, 3.6 gigawatts of wind stations, and 900 megawatts of small hydroelectric power plants should appear in Russia. The program has already yielded fruit, and investors have committed to build solar stations with a total capacity of 904 MW. The tenders attracted primarily Chinese investors. For example, Solar Systems, which is a subsidiary of China’s Amur Sirius, announced that it intends to invest up to $1 billion in Russian solar energy projects. The Chinese investors plan to build three power plants producing a total of 175 MW.

Large Russian corporations, including state-owned companies, are actively investing in alternative energy. RusHydro, Russia’s largest hydroelectric power plant operator, plans to construct mini plants with PowerChina. Investments will amount to $1.7 billion by 2020. Furthermore, RusHydro also plans on building 139 solar stations, 35 wind stations and two wind farms.

Rosnano, a state company created by Anatoly Chubais to develop nanotechnology, is also very active in the development of alternative energy. Rosnano is ready to offer China its solar panels, said Chubais at the St. Petersburg International Economic Forum in June 2016. Moreover, Rosnano is holding talks, including with its Chinese partners, about investments in Russian wind energy.

“There has been a change in Russia that few noticed, and recent decisions have shown that after solar energy Russia will start realizing wind energy projects,” said Chubais on Rossiya-24 TV. In particular, Rosnano has already established two foundations with investors from China for developing alternative energy.

A Sunny Future

The Russian and Chinese focus on developing alternative energy responds to global trends. According to a 2015 report prepared by the International Renewable Energy Agency, by 2030 the total capacity of all the world’s solar-powered electricity plants will increase by more than 10 times from the current 227 GW, to 1760-2500 GW. The agency believes that the markets with the most potential are Russia, Brazil, China, Israel, Jordan, Mexico, the Philippines, Saudi Arabia, South Africa and Turkey; which means that three BRICS countries are on the list.

“Alternative energy is of great interest for Russian-Chinese collaboration,” said professor Ivan Kapitonov of the RANEPA Higher School of Corporate Management. He adds that China, which is relatively poor in energy resources, has been developing alternative energy for a long time, and has the best and least expensive technologies in this field. Private Chinese companies are particularly eager to work with Russia.

Authored by: Alexey Lossan

“Certainly Russia and China can cooperate in the field of alternative energy,” Dmitri Baranov concurred, adding that this is a response to global trends concerning the increase of such generation and an awareness of environmental protection. Second, this relates to each countries’ demand for power, since agreements call on increasing the share of this type of energy. Third, these countries have interesting breakthroughs in the field that can be successfully developed, both domestically and internationally.

Betting on the Far East

Experts believe that Chinese authorities are primarily interested in creating additional energy generation for the country’s needs, and this makes Russia’s Far East extremely interesting for Chinese investors. China’s ecologically dirtiest areas border this area, while neighboring Russian regions are oriented precisely towards developing alternative energy. According to the Russian

Association of Solar Energy, the Far East’s potential is at least 500 MW. In turn, PowerChina’s Russian partner, RusHydro, has already set up two wind diesel complexes on Kamchatka and one on Sakhalin. The government of another Russian region, Yakutia, is building a wind farm with the Japanese Komai Haltec Inc., a plant that has a 1-MW capacity.

The Russian Energy Ministry and the State Grid Corporation of China are currently studying the prospects of building a wind farm in the Far East’s north. The project includes the transference of electricity along ultra-high

voltage power lines to China.

“China actively imports electricity from its neighbors --- Russia, Mongolia and even a bit from North Korea,” explained Kapitonov, adding that the development of alternative energy in the Far East has a lot of potential both for domestic consumption and for supplies to China.

“China has been showing interest in buying electricity from Russia for several years and is already doing so, which will help it guarantee electricity for the country’s northern regions and abandon its old coal power plants,” said Baranov. ■

EXPERTS BELIEVE THAT CHINESE AUTHORITIES ARE PRIMARILY INTERESTED IN CREATING ADDITIONAL ENERGY GENERATION FOR THE COUNTRY’S NEEDS, AND THIS MAKES RUSSIA’S FAR EAST EXTREMELY INTERESTING FOR CHINESE INVESTORS.

Physical and Digital Connections: Accelerating Inclusive Growth and Prosperity in Asia

Another Asian miracle is in the making, which will build on the region’s economic links, by creating both physical connectivity and digital connectivity within Asia and between the region and the rest of the world.

Muchhas been written about how a fortunate combination of open economic policies and access to international markets enabled global supply chains to take root in Asia, delivering jobs, growth and development. These economic links helped to create the Asian economic miracle that has lifted much of the region out of poverty, cemented its place in global production, and given rise to the Asian middle class that will be measured in the billions. Today, global brands and retailers are actively preparing for this wave of new consumption: whether it is Amazon in India or Macy’s in China, retailers recognize that Asia is the world’s next consumer power.

I believe that another Asian miracle is in the making, which will build on the region’s economic links, by creating both physical connectivity and digital connectivity within Asia and between the region and the rest of

the world. These physical and digital links will become powerful accelerators of growth and prosperity in Asia, while benefitting many beyond it.

Let me start with physical links. As Asia began to industrialize and trade with the rest of the world, its growth was constantly conditioned by its physical infrastructure. Those countries which invested in physical infrastructure, such as China and Japan, reaped the lion’s share of global and regional trade; meanwhile capable businesses surrounded by poor physical infrastructure, were handicapped in their ability to attract foreign investors and buyers, no matter how good their products or how low their wages.

Today, China continues to hold great appeal to foreign buyers and manufacturers, who say that the country’s continually improving infrastructure – which gives producers speed and access to raw materials and markets—

helps to offset the effect of rising wages.

Today, increased prosperity, population growth and urbanization are creating new sets of infrastructure needs, on top of those demanded by industrialization. The Asian Development Bank has estimated that Asia needs $8 trillion in new infrastructure from now until 2020, creating a funding gap of several trillion dollars. Into this picture step the Asian Infrastructure Investment Bank and China’s Belt and Road Initiative. The AIIB, with an initial capitalization of $100 billion, and the Silk Road Fund with an additional $40 billion, will help to kick start some of the fund flows.

They are backed by the much larger Belt and Road Initiative, which will connect markets in an “economic cooperation area” that stretches from the Western Pacific to the Baltic Sea.

According to the Fung Business Intelligence, these 65 countries jointly account for 62.3% of the world’s population, 30.0% of its GDP, and

Authored by: Victor K Fung

24.0% of global household consumption.

As economies become more solidly connected, one can see the rise of integrated production and consumption networks within the Belt and Road region, thereby giving strong support to the growth of the middle class, perhaps beyond what most experts have predicted.

This middle class is certainly anticipated for its consumption, but it is also likely to become well known for its connectivity. Today’s millennials are already the most connected of any generation before them. By 2020, Ericsson, predicts that Asia will add more than 1.7 billion new smartphone connections, with over 57% of Asians connecting to the Internet by their mobiles. Cisco predicts that mobile data traffic will grow at 58% CAGR from now until 2019.

The Internet has already established itself as a key tool for modern life: it has facilitated management, research, education,

entertainment, and exchange, first over desktops, and now increasingly through mobile. In many developing countries smartphone penetration will soon surpass 50% of the population, bringing more factory workers, farmers, and laborers online. As this happens, the Internet could become the great equalizer as well, opening up opportunities to the poor that would be otherwise out of reach.

There are already several famous case studies about farmers, with access to real-time market data on commodities via their mobile phones, who were able to negotiate much better deals with local distributors. In the same vein, it takes years to improve primary and secondary education, and even then, decisions at the national level may not have their intended effects locally. We should be asking ourselves how we might use the Internet to supplement the education available in village schools.

Several years ago, World Bank’s Growth Commission, headed by Nobel economics laureate Michael Spence studied a number of high growth economies and noted that none had sustained high growth over an extended period without investments into education, infrastructure, and health. The commission concluded that although high growth is not an aim in itself, it is a “necessary, if not sufficient, condition for broader development, enlarging the scope for individuals to be productive and creative.”

Within such a framework, the Belt and Road Initiative takes on a new light. For sure it will be a driver of growth, bringing much of the developing world into expanded networks of trade, production and consumption. But together with the rapid rise in mobile connectivity, it also has the potential to bring the emerging markets into the information revolution at the same time. Importantly, these connectivities have the potential to distribute opportunities more evenly than ever before – both within countries and between countries – creating truly inclusive growth.

Indeed, with much of the world searching for new drivers of growth, and at the same

time with sustainability and social concerns higher than ever on the global agenda, a new growth paradigm has never been more sorely needed. If connectivity, symbolized by the Belt and Road and the rise of mobile, can drive growth while opening up opportunities for people, that would be both an Asian miracle, as well as a global one. ■

Dr. Victor K. Fung is Group Chairman of the Fung Group, a Hong Kong-based multinational which comprises major subsidiaries in trading, logistics, distribution and retailing. They include publicly-listed Li & Fung Limited, Global Brands Group Holding Limited, Convenience Retail Asia Limited and Trinity Limited, and the Chairman of the Advisory Board of the Asia Global Institute at the University of Hong Kong, a new multi-disciplinary think-tank co-established with the Fung Global Institute. He was also Chairman of the Paris-based International Chamber of Commerce from 2008 to 2010

Dr. Fung is an independent non-executive Director of Chow Tai Fook Jewellery Group Limited (Hong Kong), and Koc Holding A.S. (Turkey). He is also Chairman of the Asia Advisory Board of Prudential Financial, Inc (USA). Dr. Fung holds a number of civic and professional appointments. He is a member of the Chinese People’s Political Consultative Conference, an economic advisor to the People’s Government of Nanjing, a member of the Economic Development Commission of the Hong Kong Government, and the Chairman of the Steering Committee on the Hong Kong Scholarship for Excellence Scheme.

Born and raised in Hong Kong, Dr. Fung holds Bachelor and Master Degrees in Electrical Engineering from Massachusetts Institute of Technology, and a Doctorate in Business Economics from Harvard University. He was a professor at Harvard Business School for four years before returning to Hong Kong in 1976.

Hangzhou.

THE INTERNET HAS ALREADY ESTABLISHED ITSELF AS A KEY TOOL FOR MODERN LIFE: IT HAS FACILITATED MANAGEMENT, RESEARCH, EDUCATION, ENTERTAINMENT, AND EXCHANGE, FIRST OVER DESKTOPS, AND NOW INCREASINGLY THROUGH MOBILE.

Visa-Free Travel is Key to Tourism Growth

Asthe CEO of the Pacific Asia Travel Association (PATA), I regularly visit our many members, partners and industry colleagues around the globe to discuss the various issues and challenges facing the travel and tourism industry. Besides the subjects of human capital development and sustainability, concerns of safety and security are always the primary topic of discussion and one that is often discussed between our partners at the Global Travel Association Coalition* (GTAC). With more than 1.2 billion international trips made each year, safety is the number one priority for the travel and tourism industry and one that can only be addressed through the strong and concerted efforts of the world’s governments and the international community.

With senseless acts of violence happening around the world on nearly a daily basis we are constantly reminded that, in today’s reality, we are never 100 percent safe and secure anywhere in the world.

However, as travel and tourism accounts for nearly 10 percent of worldwide GDP, destinations should not be restricting tourists or closing their borders in reaction to these horrific events – and travellers must be discouraged from judging a destination or country based upon the actions of a small minority.

We need to remain steadfast in the face of terror and not succumb to the fear these senseless acts wish to install in us. It is vital that we think and act critically and rationally. The industry must take a cautious approach as it moves forward and invest in technological solutions to enhance the efficiency and effectiveness of security systems while at the same time enhancing the overall travel experience.

Technology, big data and information sharing systems are already in use in many sectors of the world. There is tremendous

potential to further apply these systems in the travel and tourism industry to improve not only security but also the movement of travellers between destinations and, hopefully, put an end to needless racial, religious and social profiling.

One of the five main advocacy themes of PATA is the issue of visa facilitation and the push for countries to either remove visa restrictions or enable e-visas.

This is an issue about which I have very firm and unwavering opinions – not only because I enjoy the opportunity of travelling but also because of the importance and relevance of interconnected travel and tourism. Tourism is one of the most powerful tools for economic growth and social development, accounting for nearly one in 11 jobs worldwide. This is an industry that provides vital income and employment to local communities whilst creating a pathway towards understanding and empathy across borders and cultures.

Extremist acts are even more distressing for emerging destinations when one cowardly act of violence can affect the entire image of a country that has so much to offer the world.

Destinations can combat these stereotypes by showcasing their beauty, culture and heritage.

In my opinion the most interesting and unique attractions of any destination include the indigenous culture, wildlife and natural landscapes - but they are often located in areas where access is difficult and poverty levels are high. The Association’s challenge is to help industry stakeholders evolve those assets into attractive, marketable tourism products that maximise social and economic benefits while minimising any negative impacts.

One of our activities that we have undertaken is the PATA CEO Challenge through an exclusive partnership with TripAdvisor.

PATA is challenging emerging destinations** to showcase their unique tourism offerings that highlight their culture, heritage, history and customs. Two winners will have the opportunity to work with TripAdvisor in developing and creating a digital marketing campaign to showcase their destination to a global audience, valued at US$500,000 each.

Last year’s winners, the province of Albay in the Philippines and Thekaddy in Kerala, India, were chosen for their authentic, culturally diverse and innovative offerings. However,

Authored by: Dr Mario Hardy

With more than 1.2 billion international trips made each year, safety is the number one priority for the travel and tourism industry and one that can only be addressed through the strong and concerted efforts of the world’s governments and the international community.

these two destinations need assistance in showcasing these attractions. Albay province has made huge strides since winning in 2015 and people can see how far they have come by viewing their spotlight video on the PATA YouTube channel.

The aims of the PATA CEO Challenge are, essentially, to help to boost a destination’s marketing campaign, allowing tourists to discover a new destination and hopefully expand their views of the world - thus breaking down negative stereotypes.

If destinations are always looking to attract more international visitors they must realise that this cannot happen unless they open their doors and invite them in.

One such destination taking a positive step to encourage more visitors is Indonesia, a nation that now offers visa-free entry for visitors from 169 countries. I applaud them for taking this huge step forward in welcoming guests to their wonderful country.

By opening their doors, more visitors now have the opportunity to travel with ease to

a country with diverse landscapes and rich cultural heritage. Travellers now have a greater opportunity to visit more than 13,000 islands and connect with the many distinctly individual ethnic groups that share the national motto of ‘Bhinneka Tunggal Ika’ (unity in diversity).

This motto is something that we should all embrace and, by opening our doors, we can achieve such a goal. I hope that other destinations around the world take similar measures and I, along with our partners and members, will continue to push for such changes in the industry.

Since 1951 PATA has led from the front as the leading voice and authority on travel and tourism in the Asia Pacific region and in partnership with private and public sector members, the Association enhances the sustainable growth, value and quality of travel and tourism to, from and within the region.

In line with this mission we believe that industry stakeholders from both the public and private sectors need to stand together, collaborating closely and effectively for the sustainable, long-term development of the tourism sector. We stand together so that we may all benefit from the force for good that tourism can bring. ■

* GTAC is comprised of Airports Council International (ACI), Cruise Line International Association (CLIA), International Air Transport Association (IATA), International Civil Aviation Organisation (ICAO), Pacific Asia Travel Association (PATA), World Economic Forum (WEF), World Tourism Organization (UNWTO) and the World Travel & Tourism Council (WTTC).

** Emerging destinations refer to second-tier/third tier cities, regions, states, provinces and nations that receive currently less than 100,000 international arrivals in a calendar year

Hangzhou. China

IF DESTINATIONS ARE ALWAYS LOOKING TO ATTRACT MORE INTERNATIONAL VISITORS THEY MUST REALISE THAT THIS CANNOT HAPPEN UNLESS THEY OPEN THEIR DOORS AND INVITE THEM IN.

Ushering in a New Era of Global Progress and Prosperity through Trade

Theseletters have been scrolling across news tickers from New York to New Delhi in a banner year for free trade agreements (FTAs). The largest trade deal in history, the Trans-Pacific Partnership (TPP), was signed in February, and negotiations are progressing on another enormous FTA, the Transatlantic Trade and Investment Partnership (T-TIP). Together, those two agreements alone would cover over 60 percent of the global economy.

Political coverage has focused largely on public concerns surrounding these negotiations. This is expected, as new FTAs always bring back old debates about the benefits and drawbacks of globalization. But these conversations can be confounding to the business community and among economists, where the importance of trade has long been considered a settled question. Indeed, trade provides enormous

opportunities to businesses large and small and to consumers as well: greater scale and more competition lead to lower-priced, more readily-available consumer goods, resulting in a higher standard of living. More access to markets, particularly in emerging economies where incomes are rising rapidly, fuels economic growth and job creation. Increased economic interdependence strengthens the bonds among nations.

Another benefit of FTAs – one that is frequently underestimated – is their ability to establish higher and more consistent standards: stronger protections for workers, the environment, and intellectual property. When these safeguards are in place, the benefits of free trade are more broadly experienced.

These standards are important for a couple reasons. First, we are all better off when workers are treated fairly, when our environment is protected, and when

innovation is incentivized around the world. High standards ensure that while making products more efficiently, companies are also making them more sustainably.

The second reason that higher standards are important is that they help level the playing field for countries around the world. When countries adopt widely divergent regulatory regimes, it is often more expensive to produce goods which are shipped globally, especially for small business. But when regulatory systems are based on common standards and practices – to ensure universally strong rules grounded in sound science – everyone has a chance to compete. Clearly, far from instigating a “race to the bottom,” robust trade agreements are instrumental in ensuring high levels of protection combined with economically competitive regulatory practices.

Fortunately, TPP contains some of the highest standards of any trade agreements

News around the world this year has been dominated by familiar acronyms: TPP, T-TIP, RCEP and more.

Authored by: Andrew N. Liveris

in history, and parties involved in negotiations have stated that T-TIP will as well. When these agreements enter into force, nations comprising more than half of the global economy will have agreed to FTAs that not only open their borders, but also mandate fairer treatment inside them.

This is a vital development, both for the health of the global economy and for the future of humanity – because the next several decades will bring challenges greater than any we have experienced before. Rapidly growing middle classes in China and India will drive even higher consumption of vital resources.

Exponential population growth and global climate change will strain these resources even further, with far greater need to sustainably generate food, water, and energy.

These challenges belong to all of us. And they must be solved by all of us – not only by G-20 leaders at major global summits, but by

governments and businesses, and by academia and civil society, in a multitude of ways every day, sharing ideas and solutions at these intersections. We see this strongly at my company, The Dow Chemical Company, where we are working together, at 179 sites in 35 countries, to develop solutions to these great global challenges – from energy-efficient housing in China and Germany to cheaper, purer water in Africa and Saudi Arabia to lightweight, eco-friendly transportation in Europe.

Global trade agreements allow these scientific advances to create positive change around the world by removing the barriers that inhibit collaboration. Our work stalls when tariffs prevent us from transporting raw materials, for example, or conflicting regulatory processes impede a new product from going to market, or weak IP protections undercut the incentives for R&D. But when these

barriers come down, sustainable technologies can be more easily developed and deployed across the world.

It takes global collaboration to solve global problems. It is time we tear down the outdated and regressive barriers that obstruct progress. When we do, we can truly work together – across sectors and across national boundaries – toward a better future that is shared by all. ■

Andrew N. Liveris is Chairman and Chief Executive Officer of The Dow Chemical Company, a materials, polymers, chemicals and biological sciences enterprise, with 2015 annual sales of nearly $49 billion.

TPP CONTAINS SOME OF THE HIGHEST STANDARDS OF ANY TRADE AGREEMENTS IN HISTORY, AND PARTIES INVOLVED IN NEGOTIATIONS HAVE STATED THAT T-TIP WILL AS WELL.

More Doing, Less Talking

Thosewho want to do good often spend too much time on analysis and disagreement, hoping for perfect solutions to emerge out of uncertainty. The world must avoid talking without doing. Perhaps it is better to ask what is a sufficient solution for a sufficient period of time—and then do that. Clean cooking is a perfect illustration of a big problem whose solution is inhibited by too much debate, even though the way forward is now clear.

Cooking is the single largest use of energy in developing country homes. Clean cooking is a major objective of the world development community. Those who believe in evidencebased solutions now have available enough data and expert analysis to feel confident in planning, financing and implementing a scalable solution for at least 1 billion people: liquefied petroleum gas (“LPG”).

Health and development experts have concluded that, given the current state of technology, only provision of electricity or LPG has the possibility of providing clean cooking capability at scale. Biogas, solar, truly clean biomass stoves are all not feasible for clean cooking at scale either technically or commercially.

However, the politics and moral ambiguity of the climate change debate have delayed the deployment of LPG where electricity cannot be made available. For 1 billion additional people to do all their cooking with LPG merely means re-purposing 20 million tons—about 8%— of already existing propane and butane production to developing world home cooking. The insatiable appetite of the developed world for LPG to be used in plastic would barely be affected by redirecting LPG to clean cooking. The carbon emissions from cooking with

LPG could be offset by a mere 1% increase in developed world auto efficiency.

LPG technology, market structures and business models, regulatory and policy requirements, and costs are all well tested and well proven. The time required to build LPG infrastructure is minimal and procurement is competitive. Supply of LPG is available from many places in a competitive global market. The incremental investment needed for LPG supply infrastructure and LPG consumer finance to create and sustain by 2026 another 1 billion users is about USD 20 billion. This compares very favorably to the USD 835 billion required, per a recent McKinsey estimate, to bring electricity by 2040 to all Africans.

Why, therefore, do those who wish to support development hesitate to support large scale rapid expansion of LPG markets?

The necessary objective scientific and economic analysis has been done—LPG is a superior and feasible solution.

We at The Global LPG Partnership (“GLPGP”) challenge all of you in the G20 and the world at large to focus on implementing LPG, the clean cooking solution for the transition period between now and an economically viable, green energy future. Stop Talking, Start Doing! ■

Kimball Chen Mr. Chen is Chairman of Energy Transportation Group, Inc. (“ETG”) which develops liquefied natural gas (“LNG”) and liquefied petroleum gas (“LPG”) projects. He presently serves as Chairman of The Global LPG Partnership, a UN supported Public Private Partnership leading global efforts to provide LPG to 1 billion people.

Mr. Chen served as President of the World LPG Association (“WLPGA”), the global LPG industry association, 2012-2015. He advises governments on LNG and LPG policy issues and also serves on the International Chamber of Commerce G20 CEO Advisory Group, which provides policy recommendations to the G20 heads of state.

Mr. Chen graduated from Harvard University with a B.A. (Magna Cum Laude) in 1973 and with an MBA in 1978.

It is better to ask what is a sufficient solution for a sufficient period of time—and then do that.

LPG TECHNOLOGY, MARKET STRUCTURES AND BUSINESS MODELS, REGULATORY AND POLICY REQUIREMENTS, AND COSTS ARE ALL WELL TESTED AND WELL PROVEN.

Authored by: Kimball Chen

Health and Development

Labor Market Integration in the South Pacific: Lessons from the Australian—New Zealand Experience

Since 1973, Australia and New Zealand have rapidly opened their labor markets to citizens of either country under the Trans-Tasman Travel Arrangement.

Throughthe Pacific Islands Forum –the main multilateral organisation in the South Pacific – Australia, New Zealand and a number of less developed small island states (known as the Forum Island Countries) are approaching the final stages of negotiations on a comprehensive trade deal under the umbrella process established in 2001: the Pacific Agreement on Closer Economic Relations (PACER Plus). The deal aims to build on the existing agreements – chiefly the South Pacific Regional Trade and Economic Co-operation Agreement – that both Australia and New Zealand have with Forum Island States. The intent is to further reduce (in many instances without reciprocal obligations for the poorer countries) trade barriers on a wider range of goods and services.

Both Canberra and Wellington accept that PACER Plus has both an economic and development rationale. Yet if development is a key part of PACER Plus, there is a definite need to consider labor – disappointingly absent from serious discussions – as being one part of the solution. This is a major challenge for Australia and New Zealand as labor market access involves much more than striking high-level agreements with the Pacific islands on mobility and work rights; policymakers should not forget the key role of technocratic cooperation. Australia can play a leading role here by including the Pacific Islands in existing governance mechanisms which address these issues, usefully drawing on the experiences of labor market integration with New Zealand.

While progress has been made on

liberalising the regional market for goods and services, negotiations on labor have lagged behind. This has not gone unnoticed by Forum Island Countries which have had comprehensive labor market access to the two richest economies of the South Pacific on their agendas for years – the Fijian Prime Minister, Frank Bainimarama, stated earlier this year that his country was seeking ‘binding commitments on labour mobility’. Given the region’s substantial population growth, high unemployment and low levels of economic development, there is a strong argument for allowing workers in Pacific island states to relocate – even temporarily – to these richer states so that employment income can be remitted and invested in their home countries. Indeed, the Australian and New Zealand seasonal workers schemes – which allow Pacific island countries access to these labor markets for short periods of time to work mainly in primary industries – have shown some success. According to a 2012 report by Paul Merwood, the New Zealand scheme –which is the more established of the two –enjoys high worker return rates for subsequent seasons, and delivers economic benefits both for the host country and the home workers’ states. This was further supported by John Gibson and David McKenzie in a 2014 contribution who also noted that overstay rates for the scheme were very low.

In Australia’s case, the focus to date has been overwhelmingly on access for low- or unskilled labor from the Pacific islands to meet sector-specific shortages. The case for broadening the scope of the Australian

program and for reducing the administrative barriers for employers, in particular, is not new – it has already been noted by a number of researchers, such as Joanna Howe and Alexander Reilly who argued extensively for regulatory reform in this area. However, if labor markets are ‘opened up’ at some point, all countries in the region will need to cooperate in a very granular, technocratic manner beforehand – a problem largely overlooked.

Such cooperation is vital to ensure that the benefits of labor market access are realised efficiently and effectively. As the Pacific region’s labor market steadily upskills, harmonization and mutual recognition will become substantial problems – a story familiar to policymakers aiming to develop effective regional labor markets. The most successful large, comprehensive cross-border labor market – the European Union – is the result of decades of negotiations and planning. While the scope and scale of this challenge might be less in the South Pacific, the region’s countries should be planning now for this future by developing the necessary governance arrangements.

Australia, in conjunction with Pacific Island states, will need the right mechanisms to address the technical, ‘hidden’, barriers which will prevent the effective operation of

Authored by: Edward Mortimer

South Pacific

a cross-border labor market. The complexity and sheer volume of issues that need to be addressed mean that ad hoc approaches are likely to be inadequate and inefficient – a permanent mechanism through which Canberra, Wellington and the Forum Island

Countries can reach agreements would yield greater benefits. This would allow the region’s states to co-ordinate policies on a range of matters – everything from the mutual recognition of qualifications to occupational health and safety.

Australia has previous experience in this area which could inform its engagement on labor markets with the Pacific. Since 1973, Australia and New Zealand have rapidly opened their labor markets to citizens of either country under the Trans-Tasman Travel Arrangement. Labor market cooperation between these two states has deepened to the extent that the vast majority of workers of all skill levels – trained under different systems and possessing different national qualifications – can easily work in either country without the need for retraining. While high-level, government to government discussions were needed to agree the Trans-Tasman Mutual Recognition Arrangement, much of the subsequent progress on labor market integration has been a technocratic exercise greatly facilitated by inviting New Zealand to

permanently participate within the Council of Australian Governments (COAG) – the Australian forum tasked with resolving similar issues between the Australian federal government and the country’s state and territory governments.

On the face of it, New Zealand’s participation in a formerly Australian structure seems like it places Wellington in a lesser position; however, it largely reflects

the pragmatic approach both countries take when it comes to their economic relationship: choosing the most effective place for cooperation based on the specific technical needs. Wellington participates in almost all (exceptions are made in areas such as transfer payments between the Australian federal government and state and territory ones) COAG councils – and on any issue relating to mutual recognition of products and skills, the Handbook for COAG Councils provides for New Zealand’s full membership and voting rights in the relevant council. In a sign that COAG could become even more open, individual COAG councils are welcome to invite other governments to participate, though not on a permanent basis like New Zealand.

While an open labour market may not yet be a reality in the South Pacific, now is the time to prepare the ground. By establishing the right governance mechanism, preparations for harmonisation and mutual recognition in the regional regulatory environment can be made prior to the liberalisation of the labor market itself. The case of Australian—New Zealand cooperation in Australian federal processes is instructive and largely successful. It therefore makes sense for the Forum Island Countries to be permanently represented – either as individual countries or as a single entity – in COAG in some capacity. This novel approach avoids the need for any new institutional structures. And by doing so, the region will be well prepared for the next steps in regional economic integration. ■

Authored by: Fumbi Chima

E-Learning, E-Commerce and E-Health: How Internet Connectivity Is Transforming Lives Across the Globe

Therise of Internet connectivity is transforming lives across the globe, with sweeping benefits for growth, jobs and prosperity more widespread by the day. Over three billion people are now connected to the Internet, with numbers predicted to rise to over six billion by 2020, according to a recent State of Broadband report. This increase in Internet connectivity could add trillions of dollars to the global GDP, and open socio-economic doors around the world. Digital connectivity provides a slew of benefits, and a unique platform for innovation, creativity and problem solving. In the past 15 years, the Internet has transformed everything from the way we do business and learn to the way we provide and access healthcare.

Access to Internet is access to knowledge. Increased Internet connectivity in the developing world would increase health literacy significantly and, according to a 2014 Deloitte study, save up to two and a half million lives by increasing knowledge about basic health and sanitation. The study even determined that the life expectancy of over |two million HIV/AIDS patients could be significantly increased because of better adherence to treatment via Internet databases and monitoring. While the benefits are due to increase exponentially in coming years, web-based health developments have already begun to save lives.

For much of the world, access to qualified physicians and health experts can be a challenge, particularly in rural and remote areas. Computerized networks and Internet connections enable long-distance training,

accurate databases, up-to-date research information, remote diagnosing, and even real-time consultation. In Kenya, a country with just one physician for every 5,000 people (compared to a one to 500 ratio in the United Kingdom), e-health innovations like the Mobile Colposcope help remove barriers to accessing health services.

MobileODT’s Mobile Colposcope serves as a cervical cancer screening tool by taking detailed images of a woman’s cervix using a device attached to a smart phone. It takes a nurse only a few minutes at a local (or even mobile) clinic to capture and store the image, then - through a 3G or wireless connectionshare it with other medical professionals from around the world for a second opinion and quick diagnosis. Without this tool, women would have to wait weeks for their samples to be shipped to distant hospitals for analysis, and often fail to return to the hospital to receive their results, thus potentially missing out on lifesaving treatment.

Like the health sector, the education sector has also embraced the digital era, and e-learning innovations are gaining popularity around the world. The Internet now provides access to schools, libraries, and databases from across the globe, exposing students far and wide to books, media and resources unimaginable just a few years ago.

The e-learning company Onebillion has harnessed the power of web-based technology to teach mathematics and reading on tablet computers in rural Malawi, a country with an average student to teacher ratio of 100 to one. The tablets, solar paneled and connected to ›

The rise of Internet connectivity is transforming lives across the globe, with sweeping benefits for growth, jobs and prosperity more widespread by the day

ACCESS TO INTERNET IS ACCESS TO KNOWLEDGE. INCREASED INTERNET CONNECTIVITY IN THE DEVELOPING WORLD WOULD INCREASE HEALTH LITERACY SIGNIFICANTLY AND, ACCORDING TO A 2014 DELOITTE STUDY, SAVE UP TO TWO AND A HALF MILLION LIVES BY INCREASING KNOWLEDGE ABOUT BASIC HEALTH AND SANITATION.

› the Internet via either 3G or wireless routers, send child-specific data back to the company’s headquarters where app developers review children’s progress and develop curricula accordingly. The company also installs solar-powered projectors into classrooms so that students can watch films, documentaries and video clips streamed from the Internet onto the teacher’s connected iPad. Access to the Internet empowers students to learn for themselves, and e-learning companies are producing a new generation of creative, tech-savvy, independent learners who will be equipped to launch their own set of innovative web-based ventures in the future.

Other e-learning opportunities, like online university degrees or training courses, have become increasingly popular now, with over seven million students taking online courses in just the United States alone, according to the Babson Survey Research Group. Companies like edX, a non-profit “massive open online course provider,” hosts over 700 online

university-level courses to a worldwide student body using open-source software. The organization even provides many courses free of charge from prestigious schools like Harvard University and the Massachusetts Institute of Technology. Some universities are even going exclusively online, with the largest university in Africa, the University of South Africa, being a dedicated open distance education institution.

The possibilities of e-learning are nearly infinite, with interactive online workshops and international multi-party Skype conferences becoming ever the norm. Web-based companies have huge potential, and are accounting for more and more of the global GDP.

According to a recent Deloitte study, extending Internet access in Africa, Latin America, India and South East Asia to levels of developed countries could generate $2.2 trillion in additional GDP growth, provide more than 140 million new jobs, and lift 160 million people out of extreme poverty.

THE INTERNET REDUCES TRANSACTION COSTS AND BRINGS FINANCIAL SERVICES TO PEOPLE LIVING FAR FROM FORMAL MARKETS, BANKS AND ATMS. INDIA CURRENTLY HAS THE FASTEST GROWING E-COMMERCE MARKET, AND HOSTS THE THIRD LARGEST INTERNET USER BASE IN THE WORLD. E-COMMERCE IN INDIA - AND AROUND THE GLOBE - PROMISES CONVENIENCE, FAST FINANCIAL DEVELOPMENT, EFFICIENCY, AND EFFECTIVENESS.

Everyday the Internet hosts a vast array of economic activity, from millions of paid downloads to billions of commercial sales and purchases. If measured as a sector, Internetrelated consumption and expenditure now accounts for more of the global GDP than agriculture or energy.

The Internet reduces transaction costs and brings financial services to people living far from formal markets, banks and ATMs. India currently has the fastest growing e-commerce market, and hosts the third largest Internet user base in the world. E-commerce in India - and around the globe - promises convenience, fast financial development, efficiency, and effectiveness.

The Internet allows customers to more easily gather information about competitor’s prices and products, making the market increasingly competitive. Online transactions bypass sticky fingers, while also providing a fast and effective way of reaching global markets, with companies like Amazon India helping over 6,000 Indian businesses securely sell product abroad.

The convenience and cost-effectiveness of buying and selling online has led to a proliferation of companies that solely c onduct business online. Etsy, for example, is a peer-to-peer e-commerce website that acts as an online craft fair, with each seller having a personalized website “storefront” to list their goods. Companies like Etsy have a global marketplace, and sell and ship to and from all over the world.

While the advantages of Internet access are marked and varied, these benefits still elude large portions of the developing world. The global digital divide is enormous: most developed countries boast connectivity levels of 80 percent or higher (South Korea has the highest broadband penetration rate, with 98.5 percent of its homes connected) but connectivity in the developing world is often less than 20 percent (the Internet is available to less than two percent of the populations in Guinea, Somalia and Burundi). Closing the global Internet divide and expanding e-commerce, e-learning and e-health innovations in the developing world will have massive impacts on global health, economy and prosperity. With greater access, even more transformations –in all corners of the globe – are in store. ■

Fumbi Chima is the Chief Information Officer of Burberry and an Advisory Board Member of Diplomatic Courier.

Authored by: Viktor F. Vekselberg

Innovation as a Sustainable Growth Driver

Assuming the G20 presidency for 2016, China declared the desire to work together with the partners towards an innovative, invigorated, interconnected and inclusive world economy. Hence the theme of the G20 2016 Summit, where innovation comes first. According to the Chinese agenda “the G20 should forge new growth engines by promoting innovationdriven development, encouraging across-theboard innovation in science and technology, in development concepts, and in institutions and mechanisms, as well as in business models”. In other words, innovation covers all the aspects of G20-B20 activities.

Innovation covers all the aspects of G20-B20 activities.

The role of innovation in the ongoing G20-B20 efforts to secure sustainable growth is hard to overestimate. The topic is on the agenda for many years. Sometimes innovation issues make a separate block for a specialized G20 or B20 taskforce, while in other cases, like in China this year, they form some kind of a red thread running through the activities of all the taskforces. But these issues are never forgotten neither by business leaders in their annual recommendation to the heads of states and governments, nor by their addressees.

Every year makes the significance of new technologies and new culture in research and enterprise more evident. What once seemed a foray into the digital economy today has become a critical foothold in the economy of the future that operates on different provisions and conceptions than what the world has relied on before. Today innovation is a process

synonymous with growth, critical for enduring in the years to come and holding a competitive position in the global economy.

The B20 Innovation and Development as a Global Priority Taskforce, functioning during Russia’s G20 presidency in 2013, proclaimed an ambitious target to find the ways and means for transition to an improved global environment, to mobilize business potential and secure government support to facilitate a transfer towards the new technological mode, with its:

■ World of creators – where policy approaches to innovation, including on intellectual property (IP), stimulate a dramatic increase in the creativity of citizens;

■ World with universal energy access, secure supply, reasonable prices (as well as mitigated price volatility), and minimal environmental damage – where investments

are made in renewables that can be effectively and economically sustained, and traditional energy sources are further developed and environmentally improved with cutting-edge cost-effective and productive innovation;

■ World of unprecedented healthy longevity – where policy makers focus on better living conditions and better quality of life;

■ World of sustainable resource consumption with an increasing use of biotechnological products and processes;

■ World of more rational, better-informed decision-makers – where information and communications technologies (ICT) are universally accessible and applied to all sectors of the global economy.

There was a progress in some directions over the years, but all the above targets are ›

EVERY YEAR MAKES THE SIGNIFICANCE OF NEW TECHNOLOGIES AND NEW CULTURE IN RESEARCH AND ENTERPRISE MORE EVIDENT. WHAT ONCE SEEMED A FORAY INTO THE DIGITAL ECONOMY TODAY HAS BECOME A CRITICAL FOOTHOLD IN THE ECONOMY OF THE FUTURE THAT OPERATES ON DIFFERENT PROVISIONS AND CONCEPTIONS THAN WHAT THE WORLD HAS RELIED ON BEFORE.

Hangzhou. China

› still valid and to reach them serious enforcement in such areas as IT, energy efficiency and new energy sources, healthcare, biotechnology and ICT is required.

The global IP regime is crucial for both innovation and development. According to Joseph Stiglitz, Nobel laureate economist, “intellectual property is one of the most important aspects of globalization, especially as the world moves toward a knowledge economy. How we regulate and manage the production of knowledge and the right of access to knowledge is at the center of how well this new economy… works and of who benefits. At stake are matters of both distribution and efficiency1.” Steps are being made in this direction gradually as countries see that uniform IP regulation and beneficial regulatory modes yield great results for the economies, although many dimensions still remain to be tackled.

Improving energy efficiency, rebalancing the conventional and employment of new energy sources are the necessary overarching steps aimed at cutting costs, reducing emissions, and using resources in a sustainable and effective manner. More efficient energy production, the elimination of losses in distribution networks, efficiency in energy consumption, as well as encouraging responsible behavior of every stakeholder are essential. And innovation is a critical component of greater energy efficiency.

Focusing healthcare priorities on healthy life expectancy and productivity, on respective reallocation of healthcare expenditures, promoting production and use of bio-based processes and products, stimulating R&D in biotechnology are the other sources to promote sustainable development through innovation.

The last but not the least block of innovation priorities is related to enhancing ICT Internet infrastructure development, to enable broadband access for all, to data protection and privacy. According to SPIEF-2016 experts, last year’s 90 million cyber-attacks cost global businesses as much as USD 575 billion.

The fourth industrial revolution (Industry 4.0), driven by convergence of digitalization, robotics and additive manufacturing, leads to a new era in production efficiency and productivity. This is expected not only to reduce costs and enhance product development, but to alter fundamentally the role of labor in the entire economy.

Innovation as the application of better solutions that meet existing or new requirements leads to better goods and services, business models or technologies, to progressive trends in the markets and in society.

Without massive innovation 17 UN

DESPITE THE GLOBAL NATURE OF MANY CHALLENGES THAT G20 COUNTRIES FACE, THE SEARCH FOR INNOVATIVE SOLUTIONS IS CARRIED OUT TODAY TO A LARGE EXTENT AT THE NATIONAL LEVEL OR WITHIN INDIVIDUAL TRANSNATIONAL CORPORATIONS.

Sustainable Development Goals adopted in September 2015 to end poverty, protect the planet, and ensure prosperity for all, are hardly achievable. The same applies to the Paris agreement on climate change of last December.

Despite the global nature of many challenges that G20 countries face, the search for innovative solutions is carried out today to a large extent at the national level or within individual transnational corporations. And the recent innovation ranking, based on countries’ comparison in high-tech companies and modern manufacturing, patents and postsecondary education, research and development and qualified research staff, shows that in Top 5 not all are the members of G20 club. There is still a lot to be done by global leaders to secure the full use of innovation for sustainable growth not only at their summit in Hangzhou, but also in the preparation of future summits in Germany and India.

One example of how such challenges of modernity may be tackled is the Skolkovo Innovation Centre near Moscow. Regulated differently than any other technological centre, it is a staple of a high technology international business complex created to promote research and development, to encourage entrepreneur spirit and convert the start-ups into full scale

enterprises capable to become the leaders in their industries. One of the notable issues that became apparent after its creation is that today neither science nor innovation may exist in an isolated environment. Many advanced applications of new technology are in demand in markets different from the country’s own and many new creations are only possible because of foreign patents. Many people cross borders not only to do research, but also to acquire critical elements for their solutions that may be produced elsewhere. This process is gaining momentum with every year, creating a new highly intellectual kind of the global division of labor. Innovation is markedly different from incremental research as it is often conceived outside of the regulated environment and therefore disrupts the technological landscape. Being conducive to these new developments means supporting teams that bring their bold ideas to the market, helping them on their feet and providing necessary support both in terms of legal protection and advice. Skolkovo does this for both Russian and foreign companies, facilitating their communication and building bridges that help innovators make the daring step that separates them from success and contributing to the new global economy. By creating a regime that allows innovators to focus on their work, we stimulate new developments across all the five areas that the 2013 taskforce addressed and believe that joining the initiatives that many countries share in the domain of innovation will greatly contribute to the global progress. ■

1 J.E. Stiglitz, Economic Foundations of Intellectual Property Rights, Duke Law Journal, 57 (2008).

Viktor F. Vekselberg is Chairman of the Board of Directors of the Renova Group, President of the Skolkovo Foundation. Born on April 14, 1957 in the town of Drogobych, Lviv Region. Graduated summa cum laude from the Moscow Railway Transport Engineering Institute in 1979. In 1990, Viktor Vekselberg founded Renova management company. In 1996, he founded SUAL Group. In 1997, together with partners he founded Tumen Oil Company (from 2003 - TNKBP). During the period between 2007 and 2012 he was the Chairman of the Board of Directors of United Company Rusal (UC Rusal). In March 2010, Viktor Vekselberg was appointed as Head of the Skolkovo Innovation Center project. Viktor Vekselberg has been President of the Skolkovo Foundation since June 2010.

Antibiotic Use in Livestock Farming

Antimicrobial resistance and the threat this poses to the future viability of antibiotics continues to be hotly debated. The main topic remains how to preserve the efficacy of current antibiotics for treating human bacterial infections and maintain their role in modern medicine, for example during cancer treatment and routine surgery, without jeopardising our food supplies or animal welfare.

Thediscovery of antibiotics has enabled us to fight bacterial infections. However, resistance is a naturally-occurring phenomenon that develops as bacteria defend themselves against attack, so any antibiotic use can lead to resistance. In fact, resistant bacteria that are millions of years old, pre-dating modern medicine, have been found in the ice caps.

As well as their use in human medicine, antibiotics are used worldwide in livestock production and continued access to them plays a key part in feeding an ever-increasing world population as well as ensuring optimum animal welfare. However, it is acknowledged that agricultural use of antibiotics can contribute to resistance in humans, but the extent and mechanism of this is widely disputed and needs further research.

Irrespective of identifying the specific routes through which resistance may be developing, it is important for antibiotics to be used responsibly in both human and veterinary medicine. As bacteria are ubiquitous and do not respect geographical or species boundaries, we all need to work together to combat this serious threat.

To look more closely at use in farmed livestock, antibiotics are used to treat or prevent disease and, in some countries, for growth promotion. They are a vital veterinary tool to protect animal health and animal welfare. Innovations and new antibiotics in the veterinary field are unlikely to happen in the short to medium term, where we are likely to see development of new products directed at human medicine, so first of all, we need to take action globally to keep the antibiotics we currently use working effectively. This will help us to continue to produce the quantity and quality of food we need to feed our growing populations.

Secondly, while there is only a small risk of antibiotic use in animals leading to resistance problems in humans, this does not

absolve farmers from sharing in the global response to this threat. Unnecessary use of antibiotics, for example to treat viral diseases or to promote growth, wastes money and increases the risk of resistance.

This means we need farmers around the world to reduce, refine and replace their farm production antibiotic use to preserve the efficacy of antibiotics available to them and to human medicine. This may well be a difficult message, especially for farmers in developing countries where failures in pharmaceutical or regulatory infrastructures, or poor welfare conditions, have increased reliance on farm antibiotics.

So while the challenges in developed countries can revolve around supply chains, market pressure and communication, in developing countries it’s extended veterinary services that are needed to help farmers get the right medicine for treating their animals and to use those medicines at the right time and in the right way. For antibiotics in particular it is important to use the right dose for the full course of treatment as low doses and reduced treatments will increase the risk of resistance.

Responsible use also means using antibiotics “as little as possible and as much as necessary” – in other words, managing farms to reduce the risk of infection by improving hygiene, using good quality feed, giving the animals access to fresh water, using vaccines and controlling the movement of animals and people into and around the farm through good biosecurity practises.

Antibiotics should be used for animal health and welfare justifications, rather than economic reasons, so they should not be used for growth promotion. Animals, like humans, will inevitably become ill and antibiotics should be used to treat bacterial infections and only on the instruction or prescription by the veterinary surgeon responsible for the animals, where such services are available.

Free guidelines summarising all these

measures for responsible use are available for vets and farmers to download at www.ruma.org.uk.

In conclusion, RUMA asks the G20 to:

■ Appreciate the full complexity of the issues around antimicrobial resistance in terms of the causes, the role of antibiotics in humans and animals, and the challenges around tackling resistance sustainably and effectively

■ Recognise the areas in which responsible use is already happening

■ Work with regulators and vets in each country to understand the challenges more fully, and develop bespoke, workable solutions that are specific, measurable, achievable and sustainable for those involved. ■

Authored by: Gwyn Jones

Gwyn Jones is Chairman of the Responsible Use of Medicines in Agriculture (RUMA) Alliance.

Leaving Nothing to the Imagination

When nations enthuse over a 45% tax on Chinese goods, economists roll their eyes. Adam Smith might have dismissed it as ‘one of those cases in which the imagination is baffled by the facts’.

There’s

been little to unite left and right during the US Presidential campaign but trade agreements appear to be the first casualty when it comes to appeasing voters who are worried about next month’s pay-check. The fact that these same voters will struggle to afford more expensive goods can wait until after polling day. This kind of collective rear-guard action is a pattern we’ve seen time and time again when politicians know votes are at stake. And it’s not just America.

The World Bank recently noted that around the globe, discriminatory practices outpace liberalisation efforts by more than two-to-one. The G20 are the worst offenders; in the seven months to mid-May, these economies applied 145 new measures. That’s 21 a month –the highest average since the WTO began reporting. Little wonder then that growth in global trade continues to go backward.

In the five years leading up to the GFC, yearly increases in global trade stood at nearly seven per cent. It now looks likely we’ll see a fifth successive year of sub-three per cent growth. The combination of these latest trade-restrictive measures and anti-trade sentiment will continue to affect trade flows, frustrating economic growth and jobs creation.

Some G20 countries are removing restrictions. But the rate at which this is happening is a reflection of the general sentiment; of the total number of traderestrictive measures recorded for these

economies since 2008, the share of eliminations or roll-back amounts to less than a quarter. Given the effect weak global trade, low commodity prices and stilted capital flows are having on the World Bank’s growth forecasts – recently slashed by 0.5 per cent to 2.4 per cent – this is too important an issue to leave solely in the hands of the world’s politicians. The commercial world needs to step up.

So, how can business play an active role in combating the rise in protectionism and ensuring trade agreements that do exist actually achieve what they were designed to bring about? The International Chamber of Commerce is targeting policy development on a global scale, developing practical recommendations that will support and sustain greater volumes of trade.

This important work was evidenced recently in Geneva, with the ICC meeting with the World Trade Organisation for its inaugural summit. A key focus was simplicity and universality. Business wants to see practical sector-by-sector liberalisation efforts, in addition to the challenging work of all-in global agreements. Consistent rules and end-to-end standards would lower cost and complexity as smaller and more agile organisations feed into global supply chains, fostering growth.

In 2014, G20 leaders agreed on the ambitious goal to lift the level of G20 GDP by at least two per cent by 2018. But are politicians

really looking beyond rate cuts and quantitative easing to turn things around? The Bank of England Governor Mark Carney, who’s also head of the G20 financial stability board, says implementation has lagged since that summit. The BoE now expects the level of GDP in 2018 to be more than 3% below the IMF expectations back in 2014.

If business is to enhance its influence it must accept the responsibility that comes with it. Realistic policy reform proposals require hard work, thorough analysis and actionable insight. Leaders in the commercial world must be prepared to devote time and resources to the task: identifying the trade obstructions and prioritising those we should fight to remove. The private sector must uncover the benefits of standardising processes on a global basis and work collaboratively with policy makers to make these a reality. Stubbornly slow growth will continue to push politicians towards beggar-thy-neighbour rhetoric. If imagination is sometimes baffled by the facts, perhaps it is time to make things clearer for world leaders. Let the protectionists talk loudly, business just needs to be heard. ■

John W.H. Denton AO was recently elected ViceChairman of the International Chamber of Commerce and is one of the two originating members of the B20 - the business reference group of the G20. He is a Partner and the Chief Executive Officer of Corrs Chambers Westgarth, the leading Australian independent law firm. John was appointed as an Officer of the Order of Australia (AO) last year; the highest recognition for outstanding achievement and service in Australia.

SOME G20 COUNTRIES ARE REMOVING RESTRICTIONS. BUT THE RATE AT WHICH THIS IS HAPPENING IS A REFLECTION OF THE GENERAL SENTIMENT; OF THE TOTAL NUMBER OF TRADE-RESTRICTIVE MEASURES RECORDED FOR THESE ECONOMIES SINCE 2008, THE SHARE OF ELIMINATIONS OR ROLL-BACK AMOUNTS TO LESS THAN A QUARTER.

Authored by: John W.H. Denton

Financing Global Trade: The Most Important Branch of Finance You’ve Never Heard of

Trade remains, despite a challenging post-crisis environment, one of very few powerful commercial and policy levers that can influence conditions on a global scale, and it is now widely recognized outside a small group of practitioners who have known this for a very long time, that trade cannot take place without the critical enabling support of trade finance.

Thisesoteric branch of finance has long been the purview of international bank and is still in part enabled today by instruments and banking practices that date back hundreds of years if not longer. Trade finance by its broadest definition, which now includes fast-growing techniques in the financing of global supply chains, supports perhaps as much as 80% of global merchandise trade flows, currently worth in the range of $20 trillion annually. In addition to providing critical financing in support of cross-border commerce, trade finance (and increasingly, supply chain finance) offer a range of highly effective risk mitigation options, through financing structures, private sector, public sector and international institution sources, that are fundamentally important to enabling trade in and with the most challenging markets on the globe.

The central (if until recently, underappreciated) role of trade financing to the conduct of trade, to the engagement of small business suppliers in international activity, and to economic inclusion and international development, make this perhaps the most important branch of finance that many have never heard of.

Trade finance has been a core area of activity and expertise at the International Chamber of Commerce (ICC) for many decades, and is at the center of the work, thought leadership and advocacy focus of one of the ICC’s largest Policy Commissions, the

ICC Banking Commission. The Banking Commission takes a broad view in its mandate, touching on core rulemaking activities, regulatory advocacy, innovation and digitization, standards-setting, market and industry engagement, market intelligence and numerous other areas of focus.

The ICC is an influential strategic partner in the annual G20 process, as well as in related streams such as the business-focused B20, providing a unique channel and platform through which to advocate for a range of issues, with the objective of raising awareness, advancing high-level deliberations and helping to shape informed, effective public policy at the most senior levels of government.

We have accordingly been successful in recent B20 efforts, notably through the Financing Growth Task Force in 2015 and the SME Development Task Force under the current Chinese Presidency, in raising the profile and visibility of trade finance and supply chain finance as a critical enabler of numerous shared commercial, economic and political objectives across the G20.

These efforts, which have resulted in concrete recommendations flowing through each task Force, have been complemented and strengthened by further advocacy through the G20 CEO Advisory Group, and the annual ICC Banking Commission Consultation hosted most recently in Johannesburg, and co-chaired with Steven Beck, Head of Trade Finance at the Asian Development Bank and member of the

Banking Commission Advisory Board.

As critical as trade is in the context of OECD and advanced economies (witness the export-driven resilience of Germany during the global crisis), its is perhaps even more important in developing and emerging markets, where trade is, despite its acknowledged imperfections, a major contributor to development, poverty reduction and economic inclusion. Thus, in considering high-impact commercial and policy decisions, trade is a natural priority: even more so, now that trade and investment flows are tightly integrated. Additionally, the role of global supply chains as arteries of commerce and as channels for engagement by SMEs and developing economies demands effective, coordinated and informed action in assuring access to trade finance and supply chain finance across the globe.

The B20 Task Forces and the G20 Consultations and CEO Advisory Group activities have provided excellent, visible and authoritative platforms from which to inform decisionmakers about the critical importance of trade finance and supply chain finance, at a time when trade needs to be reinvigorated, the multilateral system requires support, and we know from analysis by the ADB and the World Bank, that there is currently a global shortage of trade finance. Recent data suggest that unmet demand could be as high as $1.1 to $1.4 trillion annually, with the gap heavily concentrated in export-driven developing Asia. By all accounts, developing economies and SMEs are the most adversely impacted by this global shortfall, with the exacerbating reality that financing for both constituencies tends to be significantly more expensive when it is accessible at all.

Task force recommendations have covered a wide range of topics and options, ranging from technical capacity building around trade financing, to enhancing information flow such as the availability of company credit reports to assist in reducing (actual and perceived) risk during credit adjudication processes, to the application of technology in trade and trade financing. There have even been proposals aimed at establishing a capital market for SME financing.

There are opportunities to shape public procurement, to take measures to enable SMEs in developing or frontier markets such as Myanmar, to successfully pursue internationalization through cross-border supply chains. The work of the various Task Forces is thoughtful, comprehensive and

Authored by: Alexander R. Malaket

publicly available, and merits, whether its conclusions rise to visibility at the G20 or not, serious consideration in the development of substantive policy and commercial initiatives.

It is completely understandable that each nation taking on the Presidency of the G20, and by extension, leadership across a range of G20-related streams, would wish to put its own stamp and promote its own particular priorities during its mandate.

That said, the proposal for at least some level of year-on-year continuity, first put forward by Australia, is the right path to follow. As the supporting organizations and numerous Strategic Partners and Knowledge Partners adapt to this principle, the next step, at least at the level of the B20 Task Forces, could be the commitment by incoming Task

Force Chairs to review the prior year’s analysis and recommendations across all Task Forces, to ensure a holistic view and to avoid unnecessary duplications of research and effort. Such a process will also help to ensure that the most compelling proposals are given a path to execution, even if the G20 may of necessity focus on other priorities.

The financing of international trade, including global supply chains, has been brought sharply into focus in the post-crisis environment, as one of the more impactful branches of finance, and has garnered the most senior attention from the ICC, the WTO, the IMF, the World Economic Forum and numerous other entities and organizations in a position to shape the global architecture of international trade and investment – a stated

objective of the joint WEF/ICTSD think tank called the E15 Initiative, which as also picked up on trade finance and supply chain finance as a topic of strategic importance.

Participation in the B20/G20 processes is a unique privilege and a memorable professional and personal experience. Doing so as a Task Force member, and in association with the ICC and the ICC Banking Commission, brings with it the opportunity and the responsibility to ensure that issues of importance to business community are given voice, but also, that senior business leaders consider the wider questions of interest to the communities, nations and G20 member states within which their enterprises grow, thrive, and generate value and impact.

Trade financing, most broadly defined, is a discipline that touches nearly every dimension of the topics under deliberation at the B20, and that has clear linkages to public policy, multilateralism and the economic growth, development and prosperity of G20 Member States. It is therefore appropriate, even imperative, for this branch of finance to be squarely on the radar of business and political leaders across the G20 as a powerful enabler of growth an prosperity, that is, at this moment in short supply. ■

Alexander R. Malaket CITP, is President of Canadian consultancy OPUS Advisory Services International Inc., established in 2001, focusing on international business, trade and investment with a specialism in trade finance. Alexander has undertaken a range of consultancy assignments, from operational and tactical to technology, to global strategy, for clients around the world and has developed and delivered training seminars and programs in numerous markets including Toronto, New York, London, Hong Kong, Singapore, Dubai and Taipei among others.

Mr. Malaket is an internationally recognized expert in international business, trade, investment as well as trade finance and supply chain finance, contributing regularly to industry publications like Trade Finance Magazine, Trade & Forfaiting Review, Global Trade Review, Cash & Trade Magazine and Trade and Export Finance. Alexander speaks and chairs panels at top-tier conferences and events around the world, and is the author of “Financing Trade and International Supply Chains”, Gower/Ashgate Publishing, UK 2014.

Hangzhou. China

Authored by: Jean-Sébastien Jacques

Infrastructure: The Road to Global Prosperity

XiJinping’s vision for taking China’s infrastructure expertise abroad has multifaceted benefits: China’s domestic infrastructure expertise will support job creation at home, build demand for Chinese-made goods and services, grow and strengthen economies that create new markets for Chinese trade and build partnerships with a broad and strategic geography.

This latest phase in China’s infrastructurebased growth plan builds on the country’s stunning success in creating domestic economic growth that has seen 700 million Chinese join the middle class over a generation. Then, as now, the cornerstone of this success was development of policies that created an infrastructure boom.

In a world struggling to restart global growth, other countries could learn from

China’s success in infrastructure. G20 leaders have long recognized the catalytic power of infrastructure investment but have struggled to make commitments that have translated into a Chinese-style boom.

Infrastructure provides the foundation on which people build businesses, create jobs and generate wealth. It advances society, boosts trade and production and provides billions of people with the fundamentals of modern life that many of us take for granted, such as electricity and clean water, and linkages through transport and telecommunications.

Approximately $9 trillion is spent each year globally on infrastructure, including $2.6 trillion on transport, power and water, and telecommunications.

Despite this significant investment, there is expected to be a shortfall of up to $20

trillion in infrastructure spending over the next 15 years.

Policymakers should look closer at the potential productivity, economic and social dividends from a massive global infrastructure push. China’s economic pathway provides at least five lessons for the rest of the world:

SPENDING: China spends more on infrastructure than North America and Western Europe combined. Governments in the West need to understand that to enjoy the benefits of infrastructure-led growth they have to aim higher in terms of the size of investment spending. They can do that in smart ways through leveraging government funding and tapping private investors, but the bottom line is we need a step-change in the approach to spending.

China’s One Belt, One Road policy is the latest innovation in its remarkably successful economic development program, with infrastructure development at its core.

FINANCING: China funded a large portion of its infrastructure growth by encouraging the financial sector to participate in infrastructure lending. Financial institutions in many of the G20 countries have very high prudential reserves that can only be invested in what are now very low-interest government securities. Banks and financial regulators should examine how they can create new forms of infrastructurelinked bonds that banks could hold as part of their prudential reserves, without creating undue risk to the financial system.

STREAMLINING PERMITTING:

For major projects, China’s regulatory agencies worked together to advance projects of national importance through strong coordination to ensure projects were not unduly delayed by permitting and bureaucracy. In the US, President Obama recently signed into law a new program called FAST 41 that will ensure that all regulatory agencies involved in a major infrastructure project are coordinated, avoid duplication and abide by a reasonable timeline. Permitting is an area firmly in the control of government leaders and they can influence processes to ensure that permitting is smoother, without any safety or environmental impacts.

INNOVATION: China realized it wasn’t enough to just build roads and ports for today. The focus was always on the vehicles of tomorrow. Innovation is a hallmark of China’s infrastructure program. For instance, China is home to the first maglev train, a futuristic transportation innovation that whisks people at 431 km/h from Shanghai Pudong Airport to central Pudong. Besides the futuristic aspects of the Maglev train, the Chinese companies that built the track had to innovate to engineer unique solutions for the soil conditions in the Pudong area to meet stability and precision criteria. Several thousand concrete and steel piles were driven to depths up to 70 metres every 25 metres to secure the sustainability and safety of the track.

CLEAN POWER IS INFRASTRUCTURE TOO: Embedded in its infrastructure planning, China has made cleaning up the environment and conversion to clean power sources a national priority. The country is the world’s leading producer of renewable energy and China’s investment in clean power now exceeds its total investments in fossil fuels and nuclear power. For the tenth consecutive year, China added more new installed

hydropower capacity than the rest of the world combined.

Building on the success of the last two decades of infrastructure investment and innovation, China is now sharing its infrastructure success with the rest of the world through the One Belt, One Road policy, the development of the multilaterally-funded Asian Infrastructure Investment Bank and the $40 billion Silk Road Fund. These developments are the next chapter in Chinese infrastructure leadership, one that will provide benefits for millions of people outside of China, not just China itself.

China’s infrastructure leadership was evident earlier this year in Shanghai where G20 Ministers and Governors reaffirmed their commitment to advance infrastructure investment, encourage co-operation between Multilateral Development Banks and launch a global infrastructure connectivity alliance to advance high-quality projects.

G20 leaders would be wise to take the time to learn from China’s many infrastructure successes and consider how they too can tap the multiple benefits to be derived from innovative infrastructure investment. Real, actionable commitments to spend more on infrastructure will spur global growth, facilitate trade and create jobs. ■

Jean-Sébastien Jacques was appointed Rio Tinto chief executive on 2 July 2016. He is also a director on the Rio Tinto board.

He joined Rio Tinto in October 2011 as the president, International Operations for the Copper group. He was appointed to Rio Tinto’s Executive Committee in February 2013 when he was made chief executive of the Copper group. In February 2015 he also assumed responsibility for the company’s coal assets, leading a business with nine international operations. He also had responsibility for two growth projects, Oyu Tolgoi in Mongolia and Resolution in the USA.

He has been chairman of the International Copper Association since late 2014.

Prior to joining Rio Tinto, he spent more than 15 years working in various roles across Europe, South East Asia, India and the US. He covered a wide range of operational and functional positions for the aluminium, bauxite and steel industries and served as group director, Strategy for Tata Steel Group from 2007 to 2011.

Jean-Sébastien lives in London with his family and holds a Master of Science from École Centrale Paris.

APPROXIMATELY $9 TRILLION IS SPENT EACH YEAR GLOBALLY ON INFRASTRUCTURE, INCLUDING $2.6 TRILLION ON TRANSPORT, POWER AND WATER, AND TELECOMMUNICATIONS.

Global Infrastructure Hub: Connecting Global Insights to Unlock Infrastructure Potential

InNovember 2014, G20 Leaders agreed a new initiative to lift quality public and private infrastructure investment (the ‘Global Infrastructure Initiative’), including the establishment of a Global Infrastructure Hub (‘Hub’) to be based in Sydney, Australia.

The Hub was given a four-year mandate from the G20 to lower barriers to investment, increase the availability of investment-ready projects, help match potential investors with projects, and improve policy delivery.

This mandate was to be achieved through:

■ Developing a knowledge-sharing network to aggregate and share information on infrastructure projects and financing

between governments, international organisations, multilateral development banks, national infrastructure institutions, and the private sector.

■ Addressing key data gaps that matter to investors.

■ Developing effective approaches to implement the voluntary G20 Leading Practices on Promoting and Prioritising Quality Investment, including model documentation covering project identification, preparation and procurement

■ Sharing best practice approaches to build the capacity of officials and improve institutional arrangements for infrastructure.

■ Developing a consolidated database of infrastructure projects, connected to

national and relevant multilateral development bank databases, to help match potential investors with projects.

Australia, China, Mexico, New Zealand, the Republic of Korea, Saudi Arabia, Singapore and the United Kingdom fund the Hub. The Board comprises representatives of six G20 countries as well as two independent directors. Australia is Chair of the Board for the term of the Hub’s mandate, represented by the Secretary to the Australian Treasury.

Unlocking Infrastructure Potential, Globally The strategic vision of the Hub is to transform investment processes and thereby strengthen and enhance the global infrastructure market.

There are many and varying estimates of the global infrastructure investment gap. However, they are all consistent in indicating that it is large and not closing on current policy settings.

Authored by: Robert Milliner

Although this is an ambitious goal within the Hub’s initial term, it is short by government and infrastructure standards.

To attract the trillions of dollars needed in infrastructure investment to fuel global growth and create jobs, we need better information about what’s working and why.

So what is holding back increased investment in infrastructure? The answer isn’t necessarily the same for all markets.

By facilitating knowledge sharing, highlighting reform opportunities and connecting the public and private sectors, the Hub has the ambitious goal to increase the flow and quality of opportunities for private and public infrastructure investment in G20 and non-G20 countries.

An Ambitious Program

The barrier is not a lack of funding, but rather the need for more infrastructure projects that are well-prepared and investment ready. Therefore, a priority for the Hub is to facilitate a better supply of quality, bankable infrastructure projects to the private sector.

This involves focussing on what reforms, planning approaches and risk management strategies will drive investment.

To achieve this the Hub:

■ Has surveyed a range of global private investors with respect to gaps in information and data that may be acting as a barrier to efficient infrastructure markets.

■ Is quantifying the overall projected infrastructure needs on a country and sector level.

■ Has created an online guide to existing infrastructure initiatives, organizations and documentation to connect existing resources and improve coordination at the national, regional and multilateral level.

■ Is creating a tool, the Capability Framework, to assess the extent of development and maturity of a country’s infrastructure market. The Hub has also started identifying global best practices and aims in order to benchmark existing (country-specific) capability. The Framework will enable

national infrastructure bodies to identify priority areas for policy reform, with the aim of increasing the pipeline of projects and attracting more private capital. This will allow countries to target areas which may currently be limiting private investment in their national infrastructure.

■ Has developed a new Report on Recommended Risk Allocation Principles, to be published as a ‘companion piece’ to the 2016 edition of the World Bank Group’s Report.

■ Is developing a global database that would track projects through various stages from project conception to operation to improve the visibility and understanding of government infrastructure projects by the private sector.

Other initiatives with regard to proposed leading practices are also being developed; including potential initiatives related to project prioritisation and identifying infrastructure projects best suited for private sector participation. ■

More information about the Hub, its mandate and the latest infrastructure reform initiatives can be found on: www.globalinfrastructurehub.org

Robert Milliner is an independent non-executive director of the Global Infrastructure Hub and a Senior Adviser, International Affairs at Wesfarmers Limited, Senior Adviser at UBS and Senior Adviser to the Secretary-General of the International Chamber of Commerce. He is also an independent director of the and AusNet Services Ltd, Chairman of the Board of the Foundation for Young Australians and a director of the Australian Charities Fund.

He was the B20 Sherpa for Australia for 2014 and has continued to represent Australia in the B20 as a member of the Turkey B20 Steering Committee (2015) and the China B20 International Cooperation Committee (2016).

THE BARRIER IS NOT A LACK OF FUNDING, BUT RATHER THE NEED FOR MORE INFRASTRUCTURE PROJECTS THAT ARE WELL-PREPARED AND INVESTMENT READY.

Energy’s Part in the Global Path to Prosperity

The explorer Marco Polo thought that Hangzhou was “the finest and most splendid city in the world”. For three hundred years before him, and for seven hundred years after, it has been one of China’s most prosperous cities.

Thismakes it an ideal setting for this year’s G20 and B20 summits, during which government and business leaders will discuss how best to achieve similar sustained growth throughout the world. One thing’s for sure: energy will be needed, and lots of it. After all, economic development goes hand-in-hand with an increase in energy consumption.

By the end of this century the global energy system is set to double, even if huge steps are taken to improve efficiency. Making this leap will be a significant undertaking. But it is possible. It has to be, as every single person on the planet should have access to energy. As UN Secretary-General, Ban Ki-moon frequently states: “Energy is the golden thread connecting economic growth, increased social equity and a healthy environment.” But universal access is far from a reality. More than one billion people in the world currently do not turn

out a light when they go to bed at night. It’s not because they forgot. It’s because they don’t have electricity.

Dual challenge

Energy is needed for every one of these individuals. It’s also needed to continue powering all other lives on the planet, and for the additional three billion who will live on earth by 2100. All this future demand has to be met while addressing climate change, which is also on the G20’s agenda in Hangzhou.

Many of the world leaders attending this G20 meeting were in Paris late last year for the UN climate summit. It was there that they agreed to keep the global average temperature below 2°C from its pre-industrial level. To make this happen, the International Energy Agency estimates energy related emissions need to be 19 gigatonnes a year by 2040. But current energy policies would take the world to 44

gigatonnes a year by then. That’s a difference of 25 gigatonnes a year. This reduction is a major task considering that abandoning 211 million cars – that’s almost twice the number of passenger vehicles in the USA – would save 1 gigatonne a year.

Transforming the energy system

So what’s to be done? A transformation of the entire global economy is required, especially in the four key sectors of the energy system: power, buildings, transport and industry. They are responsible for a hefty portion of energyrelated carbon dioxide emissions. Transforming these sectors means taking huge strides forward to improve energy efficiency – of homes, businesses and cities. It means more government-led initiatives that promote low-carbon technologies and infrastructures, such as carbon pricing and carbon capture and storage. And it means investing in

Authored by: Chad Holliday

multiples sources of energy.

Renewables, such as solar and wind, must play a fundamental part in the future energy system. For them to fulfil their potential, the industrial, transport and buildings sectors need to rely more on electricity. But as things stand, electricity accounts for less than one-fifth of the world’s total energy use.

The switch to using electricity will be relatively straightforward for activities such as the manufacture of clothes and food, which require low-temperature processes and mechanical activities. But for other sectors, including industries that produce steel, iron and cement, the shift will take much longer as these processes require extremely high temperatures and dense energy storage.

Ultimately, it’s about making the best use of different energy sources. In the Philippines, the Malampaya offshore gas field, which Shell operates, generates around 20% of the

country’s electricity needs. Separately, a Shell pilot project has provided a hybrid power system for a community on Palawan Island, which had no energy supply. Life has changed for people there. “We are happy because we have light every night now,” says Marcela Magno, from the Batak tribe. The system combines solar and hydro energy, and calls on a diesel generator for when these renewable sources are low.

Government and industry priorities Government and business leaders meeting in Hangzhou all have critical roles to play during the transition to a low carbon future, as do their counterparts throughout the world. For the energy industry, investment in research and development has never been more important. Engineers and scientists must pursue ideas rigorously, right to the end. Consider Tim Berners-Lee. Back in 1989, he wrote a document called Information Management: A Proposal. The response from his supervisor at CERN, the science research centre, was “vague, but exciting” and Berners-Lee was told to develop the idea. A year later, the World Wide Web was born. If the supervisor had mothballed the idea, how many years later would the internet have arrived?

For governments, it’s vital to factor all parts of the economy into their energy policies. This is China’s approach. Policies promote the role of gas – the cleanest-burning fossil fuel – in meeting peak demand for power. And in the transport sector, China is working hard to encourage the use of LNG, which is cleaner-

burning than diesel. There are currently around 200,000 heavy-duty trucks and buses powered by LNG in the country. That’s more than 130 times the number of LNG-fuelled trucks in Europe.

If many more such efforts are made throughout the world, it should be possible to provide energy to everyone, while lowering greenhouse gas emissions. In doing so, economic prosperity can spread throughout the world. That’s why energy has to continue being a big part of the conversation about the world’s economy. In Hangzhou and beyond. ■

Chad Holliday was appointed Chairman of Royal Dutch Shell plc with effect from May 2015, having previously served as a Nonexecutive Director since September 2010.

He was Chief Executive Officer of DuPont from 1998 to 2009, and Chairman from 1999 to 2009.

He has previously served as Chairman of the Bank of America Corporation, The Business Council, Catalyst, the National Academy of Engineering, the Society of Chemical Industry - American Section and the World Business Council for Sustainable Development, and is a founding member of the International Business Council.

He is a Director of Deere & Company and HCA Holdings, Inc.

Hangzhou.

ENERGY IS NEEDED FOR EVERY ONE OF THESE INDIVIDUALS. IT’S ALSO NEEDED TO CONTINUE POWERING ALL OTHER LIVES ON THE PLANET, AND FOR THE ADDITIONAL THREE BILLION WHO WILL LIVE ON EARTH BY 2100. ALL THIS FUTURE DEMAND HAS TO BE MET WHILE ADDRESSING CLIMATE CHANGE, WHICH IS ALSO ON THE G20’S AGENDA IN HANGZHOU.

Authored by: Tatiana Mohaghan

Fighting Ebola: Russia Offers a Groundbreaking Solution

Where there is an efficient public-private partnership, there is a solution to the world’s threats.

Theworld learned about the threat of Ebola in 2014 when the virus infected 28,616 people and killed 11,300, mostly in Guinea, Liberia and Sierra Leone. In addition to the massive human loss, the epidemic also jeopardized the macroeconomic stability as well as food security, human resources and private sector development in the Ebola-affected states. It also exposed numerous humanitarian problems.

Thousands of fatalities in West Africa have galvanized the global community into action. As a result, governments joined forces in the fight against dangerous epidemics worldwide. Unfortunately, it usually takes an event such as the 2014 Ebola outbreak – and public alarm in developed countries about potential infection – to trigger significant action. However, that was the starting point for the global consolidation in the face of the global threat. Russia became one of the most active participants in the combat against Ebola from the very beginning.

Russia has demonstrated its commitment to the protection of global public health through the development of a unique antiEbola vaccine. The potential of this vaccine to confront major contagious biological threats is fundamental to the successful international ›

› teamwork in response to serious diseases in Africa and other parts of the world.

It took several months for the virus to evolve, when the world realized the scale of the problem. Such delay was not entirely unexpected given the lack of the global information exchange. Practice shows that there must be a global system of rapid and efficient information flows that will enable international organizations, governments and private sector to put their heads together in the combat against such emergencies. This, in turn, confirms the need for public-private partnerships. In this regard, Russia’s most recent experience of the public-private partnership in providing assistance to the Republic of Guinea is an excellent example when governments and business can achieve better results in tandem.

What is so special about Russia’s experience? First, the mortal virus has been eventually contained, which indicates that the results of the partnership are by all means groundbreaking. Second, the private side of the partnership was represented by Russia’s UC RUSAL (referred to as ‘RUSAL’), which is among the most proud members of ICC Russia.

RUSAL, as Russia’s largest foreign investor in Guinea, implemented its own anti-Ebola projects in this country. RUSAL was among the first to accept the challenge: not only did the company decide to continue its operations in Guinea, but it also actively supported the anti-Ebola initiatives of the Russian government, forging a true public-private partnership against Ebola.

In April 2014, RUSAL donated medicines and hygiene items to the Ministry of Health of Guinea and assisted in equipping mobile sanitary posts in the autonomous sea port of Conakry.

Since August 2014, RUSAL has been providing logistical support to a special anti-epidemic team of the Russian Federal Service for Surveillance on Consumer Rights Protection and Human Wellbeing (Rospotrebnadzor) and a mobile antiepidemic research laboratory in Guinea.

In November 2014, RUSAL was heavily involved in the deployment of a mobile hospital, which was later donated to the Republic of Guinea under the Russian President’s decree. RUSAL organized complex logistics support to deliver mobile hospital equipment to Guinea. The company also ensured the safe transportation of the cargo under escort to its place of storage. RUSAL supervised on-site preparatory works for the hospital, provided accommodation for Russian military medics and equipped them with requisite resources.

It took a remarkably short period of time for RUSAL to build and launch one of the most modern centres to combat viral diseases in West Africa – the Centre for Microbiological Research and Treatment of Epidemic Diseases located in Kindia. The Centre represents a comprehensive medical facility, bringing under one roof an infection hospital, a provisional hospital, a mobile laboratory and a blood and plasma transfusion department with a laboratory. “I strongly believe that sustainable business operating globally should be well prepared to address any challenges, and epidemic is not an exception. I am proud that RUSAL is the only public company which realized such an important large-scale project to stop Ebola virus in Guinea”, remarked Oleg Deripaska, President of RUSAL, who personally coordinated this programme.

During the outbreak, the Centre operated as a hospital for the treatment of Ebolainfected patients and made over 8,000 tests on biological materials to timely detect and fight the virus. None of the hospital staff was infected thanks to the high sanitary standards implemented in the facility.

Today, the epidemic in West Africa has been eventually contained. The Centre in Kindia, however, continues its research activities focusing on detection, treatment and prevention of infectious and dangerous diseases such as Ebola. Furthermore, the Centre is expected to lead the anti-Ebola vaccination of Guinean patients with the vaccine successfully developed by Russian scientists at the country’s leading medical

and biological research institution – the Russian State Gamaleya Institute for Epidemiology and Microbiology in Moscow. Driven by the need to win international recognition, ICC Russia teamed up with the Ministry of Health, Rospotrebnadzor and the Ministry of Defence to organize a round table under the title “The Russian Ebola vaccine: first lessons and future prospects” on March 15. At this round table delegates from the Republic of Guinea received from the Russian Minister of Health all the documentation required to initiate clinical trials against Ebola virus.

The vaccine was solemnly presented at the high-level meeting “Russian vaccine against Ebola: prospects for joint activities” on May 23 organized by ICC Russia in cooperation with the Ministry of Health of Russia on the occasion of the World Health Assembly at the UN Palace of Nations in Geneva, Switzerland. The development of Russia’s vaccine received international recognition and was personally highlighted by Margaret Chan, DirectorGeneral of the World Health Organization.

The considerable efforts of the global community, and Russia’s involvement in particular, helped bring the epidemic under control. However, the possibility of a similar outbreak remains, which in turn dictates the need for the timely and efficient response.

Policymakers are increasingly focusing their efforts on better preparation for humanitarian crises in order to mitigate their human and financial cost. The success of the anti-Ebola campaign demonstrates that global partnership between governments, business and scientists is more than real and it enables us to respond to challenges that might seem unmanageable at first sight. ■

Tatiana Monaghan has been ICC Russia Secretary General of the Russian National Committee of the International Chamber of Commerce since 2000. From 1991 to 1996, she worked as a senior advisor for the World Economic Forum (Davos, Switzerland) on Russia and CIS countries. Ms Monaghan’s contribution resulted in Russia and other CIS countries having become active participants of this Forum. In 1996, Ms Monaghan joined ICC Paris, where she headed Russia and CIS Division. The 16 years’ successful functioning of ICC Russia is entirely attributed to her personal initiative and considerable involvement. Since 2003, Ms Tatiana Monaghan has been a member of the Working Group on Russia’s membership in WTO under the RF State Council.

THOUSANDS OF FATALITIES IN WEST AFRICA HAVE GALVANIZED THE GLOBAL COMMUNITY INTO ACTION. AS A RESULT, GOVERNMENTS JOINED FORCES IN THE FIGHT AGAINST DANGEROUS EPIDEMICS WORLDWIDE.

A public private partnership

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THEN SUPPORT THE MOVE TO LPG WE ARE A GLOBAL PUBLIC PRIVATE PARTNERSHIP (PPP), BACKED BY THE U.N. AND E.U. WE PARTNER WITH DEVELOPING COUNTRIES TO PLAN, FINANCE AND IMPLEMEN T CLEAN LPG ENERGY. FOR 1 BILLION PEOPLE. BY 2030.

SAVING LIVES. PROTECTING FORESTS. EMPOWERING WOMEN. www.glpgp.org

Energy Policy

Authored by: Benjamin Sporton

Coal Helping to Deliver the Four I’s of China’s G20 Presidency

Discussion on energy policy must balance the priorities of cost, security, environmental considerations, economic growth, poverty eradication and diplomatic relations.

TheG20 was conceived as a forum for leaders from the major advanced and emerging economies to discuss and co-ordinate global economic policy.

In recent years, however, this role has evolved and the organisation has now become one of the most prominent forums to address the broader challenges in global governance.

This explains why energy has become a major theme of the organisation’s work. Discussion on energy policy must balance the priorities of cost, security, environmental considerations, economic growth, poverty eradication and diplomatic relations.

Representing 80% of world trade, two-thirds of the world population and responsible for three quarters of global annual greenhouse gases (GHG), the G20 has become an important multilateral support to established processes, such as the United Nations Framework on the Climate Change.

Expectations for this year’s meeting in Hangzhou are particularly high following the delivery of the Sustainable Development Goals (SDGs) and Paris Agreement on climate change late-last year. Energy is a central consideration for both. The G20 provides an opportunity to develop programmes that integrate the environmental imperatives with aims of universal access to energy, energy security and social and economic development.

Energy access and climate goals are not competing priorities. As demonstrated by the Intended Nationally Determined Contributions submitted in the lead-up to the Paris summit, each nation will choose an energy mix that best meets its needs. For this reason many countries have identified a continuing role for coal. Coal is a critical enabler in the modern world. It provides 41% of the world’s electricity and is an essential raw material in the production of 70% of the world’s steel and 90% of the world’s cement.

As a newly industrialised country, China’s G20 presidency will bring distinct energy policy insights to bear in development and environmental discussions. Coal will no doubt be a significant part of this outcome. China has been a remarkable example of the role that affordable coal can play in improving access to energy and supporting economic development. Now, as it transitions to a less energy-intensive period of development, it is a leading example of the opportunities cleaner coal technology can provide in meeting the challenge of reducing emissions. As such energy, and therefore coal, will have a strong influence on the four I’s that make-up the Chinese presidential theme: ‘Towards an Innovative, Invigorated, Interconnected and Inclusive World Economy’.

Coal ensures inclusive economic growth

According to the International Energy Agency (IEA), 1.2 billion people - 17% of the world’s population – lack access to electricity. A further 3 billion or more than one in three of the world’s population use wood, charcoal, or animal waste for cooking and heating. Energy – along with food and shelter- is one of the fundamental elements of modern society. Without energy, people cannot access the opportunities provided by the modern world. Before we can attempt to resolve the myriad development challenges facing those most in need, we must provide access to energy.

Coal is the de-facto energy source for electrification. Since the 1980s, coal consumption has grown by over 140% in Brazil, 425% in India and 514% in China. The economic and social progress made across these countries over the same period is well-documented. Globally coal accounts for around 29% of primary energy. Coal use for electricity is forecast to rise over 23.5% through to 2040, with developing and emerging countries responsible for most of this increase. Coal will therefore play a major role in supporting the development of base-load electricity where it is most needed. Coal-fired electricity will be fed into national

grids and it will bring inclusive economic growth to the developing world.

The IEA has predicted that more than half of the on-grid electricity needed to meet their ‘energy for all’ scenario would need to come from coal. Even this is not a particularly ambitious target. The ‘energy for all’ target is equivalent to five hours of electricity a day and excludes electricity for basic amenities, such as businesses, industry, hospitals, schools and public buildings. If we are going to be more ambitious, coal will clearly play a fundamental role in supporting modern base load electricity.

Coal has become the fuel of choice for many developing countries because of its status as a widely distributed, reliable and affordable fuel. This has been demonstrated in Viet Nam, South Africa, India and many other developing countries. Over the last three decades, according to World Bank estimates, 600 million people have been lifted out of poverty – almost all of those in China. Remove China from the mix and poverty levels in the rest of the world have barely improved. The link between access to affordable power from coal, economic growth and prosperity is clear. In China close to 99% of the population is connected to the grid. ›

Hangzhou. China

AS A NEWLY INDUSTRIALISED COUNTRY, CHINA’S G20 PRESIDENCY WILL BRING DISTINCT ENERGY POLICY INSIGHTS TO BEAR IN DEVELOPMENT AND ENVIRONMENTAL DISCUSSIONS

People without access to modern energy services by region

› Looking ahead, coal is likely to remain the most affordable fuel for power generation in many developing countries for decades to come. Analysis presented in the WCA’s 2016 study, the Power of High Efficiency Coal, supports this forecast. The report considers the levelised cost of electricity (LCOE) for various technologies in non-OECD Asia. In 2035, data suggests that coal will generate electricity at a lower cost than other technologies – including gas – in ASEAN countries plus India, Bangladesh, Sri Lanka and Pakistan (grouped as South East Asia in the graphs below). The LCOE cost for the high efficiency low emission (HELE) coal technologies – supercritical (SC), ultrasupercritical (USC) and integrated gasification combined cycle (IGCC) – ranges from 55 to 60 $/MWh. In comparison, the LCOE of Open Cycle Gas Turbine (OCGT) for gas production is almost double. It should also be taken into consideration that for many of these countries coal is more readily available than gas, which requires the development of pipeline infrastructure for its delivery. The comparative cost advantages of coal generation are even clearer in China - the main economy represented in the ‘Rest of non-OECD Asia’ graphs below. The various HELE technologies have an LCOE of around $50/ MWh, a third of the price of gas production.

By 2040, power generation from coal will reach 2843 GW compared to 1805 GW today. In order for economies to use coal in a way consistent with development and environmental imperatives, the G20 must support action that promotes the deployment of the cleanest and most efficient coal technology available –HELE coal-fired power generation.

This will require developing economies to receive international financial, technological and policy support to accelerate deployment. To support the transition away from older, less efficient subcritical technology countries will require financial and technical support, including through existing structures such as the G20 Energy Sustainability Working Group.

Electricity from coal fuels dynamic interconnected economies

Inclusive growth delivered through affordable energy is the spark that drives important economic processes, including urbanisation and industrialisation. Business requires stable electricity to trade and innovate. The growth of industry, particularly in the small and medium enterprise sector, promotes opportunities for local populations through more diverse employment, which in turn leads to higher disposable income.

The recent construction of the Sasan Power Coal-Fired Power Station in Madhya Pradesh, India, for instance, supports this premise. The facility has been credited with adding $2.5 billion to the local economy through improved energy access for local businesses. Improved energy access has allowed electric pumps to be deployed in the state’s farming and allied services sector. Farmers have also benefited from improved access to market information, such as online agricultural market places. These developments have led to productivity gains through increased yields and more crop diversity.

Over the coming decades as the SDGs are realised, urbanisation is forecast to rise dramatically. People will move to cities for greater economic opportunity, modern amenities and access to education. Cities are

also the most productive places to do business, because they bring firms and customers and workers together. Continuing population growth and urbanisation are projected to add 2.5 billion people to the world’s urban population by 2050, with nearly 90% of the increase concentrated in Asia and Africa. India and China alone are projecting an additional 700 million urban dwellers. Growing urbanisation will require the construction and development of transport, energy, housing and water management infrastructure. As the most widely used fuel source for energy-intensive industries and a critical raw ingredient in making steel and cement and other industrial products, coal is a major part of this outcome. For instance, one tonne of metallurgical coal is required to produce 1.3 tonnes of steel, an equivalent of 18 household refrigerators. The economic development pathway for countries is paved with coal. Indeed, the IEA’s 2015 World Energy Outlook forecasts coal demand to grow by 4.6% per year through to 2040 in the rapidly industrialising economies of Southeast Asia. It is therefore vitally important as G20 countries seek to invigorate growth and strengthen trade through policy that ensures national governments extract and utilise coal in the most sustainable and efficient manner possible.

Innovation in coal technology brings broader economic benefits

Innovation is an important driving force for strong, sustainable and balanced growth. This understanding forms the basis of China’s G20 priorities. These priorities outline how innovation in science, technology and business can bolster growth to the global

economy. China regards innovation as an important domestic priority and is making significant progress in many sectors, including energy. Over the last ten years, for instance, the operational efficiency of the country’s coal fired power fleet has risen by 6% reaching a level above that of western countries. This is a significant development and has in part played a role the gradual decoupling between energy demand and economic growth. Indeed the BP Energy Outlook, forecasts energy intensity, the amount of energy required per unit of GDP, to decline by 36% (1.9% p.a.) between 2012 and 2035. China and several other G20 member states are now working to support others to deploy HELE technologies, rather than older inefficient subcritical coal-fired power stations.

There are likely to be significantly different opinions among members in terms of how to achieve innovative growth. A successful innovation agenda will require policy coordination, sharing of innovation benefits and incentives. As governments take stock and consider the implications following the increased ambition of the Paris Agreement, innovation in carbon capture and storage (CCS) should feature as a core focus in translating positive intention and rhetoric into action.

CCS is a low-carbon technology that must form part of a balanced portfolio approach to address climate change. The technology offers economic and development advantages when compared to a renewable-centred mitigation portfolio. Today, CCS is the only technology that can achieve significant emissions reductions (90% capture or higher) from existing fossil fuel infrastructure. Indeed, many studies have suggested that unless CCS becomes a key part of a low carbon technology portfolio, it is increasingly likely that energy-system carbon emissions will not be reduced to levels that limit global warming to 2 degrees Celsius.

While the commencement of operations at two coal-based CCS projects this year will no doubt be a major milestone, it is fair to say the pace of CCS deployment has been disappointing. The low-level of CCS deployment in power generation is not a reflection on the viability of CCS technology (as some argue), be it commercial or technical, but a reflection on the lack of equivalent policy support. For instance, in 2007 European leaders laid out plans to establish 12 demonstration CCS power plants by 2015, so far none have been developed in the region. Investment has been underwhelming and dispersed across silos of projects, technologies and regions; growth in

renewable energy technology has been driven by policy that provides $100 billion in subsidies every year. The value of government policy support provided to CCUS to date is approximately 1% of the cumulative value of policy support provided to renewable technologies. In the absence of government leadership, fossil fuel firms, including coal companies, have used their own resources and expertise to accelerate the development and deployment of CCS.

As a matter of priority the G20 should initiate a high-level consultation on strategies to increase deployment of CCS. G20 Energy Ministers should affirm their commitment to CCS and articulate deployment targets and strategic plans via the Mission Innovation initiative. Other strategies could include inviting the World Trade Organisation to promote trade in CCS infrastructure with the financial support provided through development banks.

Over the coming decades, energy policy will feature as one of the world’s most profound and pressing challenges.

The SDGs call for universal energy access to ensure social and economic development. Equally influential, the Paris Agreement provides an impetus for governments to ensure that efforts to improve energy access are balanced with action on reducing emissions. The G20 provides an important adjunct to these multilateral initiatives. In order to best serve the global public good,

however, member states must acknowledge the role that coal will continue to play in the global economy and develop initiatives to support the deployment of HELE technology. Moving the current average global efficiency rate of coal-fired power plants from 33% to 40% by deploying more advanced off the-shelf technology could cut 2 gigatonnes of CO2 emissions now, while allowing affordable energy for economic development and poverty reduction.

This will require an international mechanism to be established to provide the necessary level of support to accelerate construction of such projects. To this end, the WCA have proposed the establishment of a Platform to Accelerate Coal Efficiency (PACE) and stand ready to work with international partners to support its implementation. G20 is well-placed to translate the PACE vision to reality. Moreover, G20 must refocus governments to support the development of CCS, including the provision of CCS infrastructure in developing countries. All credible climate scenarios identify a key role for large scale and rapid deployment of CCS. While developed economies operating in advanced economies with established electricity markets are likely to lead development of CCS given the scale of resources that will be required to drive CCS to broader commercialisation, G20 provides a key forum to promote energy research and disseminate results. ■

Hangzhou.

India’s electricity generation by source and CO2 intensity in the New Policies Scenario

Authored Niels B. Christiansen

DISTRICT ENERGY IS THE PERFECT INFRASTRUCTURE INVESTMENT FOR COUNTRIES WHICH HAVE RAPID URBANIZATION RATES.

China Chooses the Fast Track

With a can-do mindset, China is showing the world how the challenges of modern living can be turned into opportunities. Investments in energy efficiency infrastructure are one of the roads to success and a lever to reduce CO2 emissions and save money.

Energy efficiency ensures cost efficiency Any energy strategy must start with energy efficiency to ensure cost efficiency. At global level, if we are to give 1.5 billion people access to electricity as envisaged in Sustainable Development Goal 7 (SDG 7)1, we need to ensure that the new 1.5 billion electricity consumers use the electricity as efficiently as possible. Imagine, for a second, what would happen if these 1.5 billion new electricity consumers adopted the technologies we used 25 years ago, including our energy habits?

The International Energy Agency estimates – in their recent Climate Technology Perspective – that energy efficiency needs to reach 38 percent of total energy demand to keep the planet within the 2 degree scenario of global warming.

In order to deliver on doubling our energy efficiency by 2050, one of the goals of the UN initiative Sustainable Energy for All, (SE4ALL),

we should ask ourselves what can we already do today, in 2016? The opportunities are numerous, but one solution is particularly future-proof: district energy.

District Energy equals cleaner air for city dwellers

Chinese city developers are fully aware that the energy we don’t use is the best energy. District energy is a well-proven technology that has found new relevance in a world seeking to optimize and reduce the carbon impact of how we cool and heat our buildings. Not only is district energy highly efficient, it is also leading the way when it comes to the integration of renewables. And the potential is even bigger once we start utilizing surplus heat from energy-intensive industries, like copper, steel, cement or pulp and paper.

In China, cities like Benxi have started using surplus heat from local steel plants to heat buildings. Four main players teamed up: the Benxi Municipality, the Liaoning Provincial Government, Benxi Steel Group and a provider of district energy solutions. The team implemented a solution that can heat |the residential area of the city with surplus heat from the Benxi Steel Group. ›

CHINESE CITY DEVELOPERS ARE FULLY AWARE THAT THE ENERGY WE DON’T USE IS THE BEST ENERGY. DISTRICT ENERGY IS A WELL-PROVEN TECHNOLOGY THAT HAS FOUND NEW RELEVANCE IN A WORLD SEEKING TO OPTIMIZE AND REDUCE THE CARBON IMPACT OF HOW WE COOL AND HEAT OUR BUILDINGS.

Hangzhou. China

Energy efficiency coupled with district energy provides future-proof solutions.

› This means that the heat generated from steel production is channeled into the district energy infrastructure rather than evaporating into thin air, and be transported to people’s homes for the benefit of the residents.

The surplus heat was to replace coal boilers, and ultimately cover a residential area of 17 million square meters. This includes providing heating in the winter and domestic hot water throughout the year. By the end of 2015, the first 3 million square meters had been fitted with the modernized heating system. This first step alone reduced coal consumption by 20,000 tons per year; contributing to cleaner air for the benefit of the 1½ million people who live in the city. The project has also turned the local heating company affiliated with Benxi Steel Group into a profit-making business.

This is good news in a country where urbanization is taking place at a breathtaking speed. In 1990, every fourth Chinese man, woman or child lived in a city; today it applies to 56% of the population, and by 2030 that figure is set to rise to 70%2. With more people on every square mile and a higher standard of living, air pollution is inclined to increase.

However, efficient district energy can equal cleaner air for city dwellers.

District energy can unlock the potential of energy efficiency

The technologies required to unlock this potential already exist. We have solutions at hand that are modern, well-proven and even have attractive pay-back times.

District energy is a solid example of this. A report from the United Nations Environment Program3 highlights district energy infrastructures as a fast track to unlocking the potential of energy efficiency and renewable energy in cities.

According to the report, published in February 2015, a transition to modern district energy systems could play an important role in reducing energy-sector emissions by up to 60% of the required by 2050. It would halve the consumption of energy across the world.

We have the products and technologies necessary to make significant changes in energy efficiency. Despite the strong business case and the fast track to CO2 reductions, the potential of energy-efficiency initiatives are still to be fully realized. So a key question in the

post-COP21 world remains: How do we accelerate the adaptation of best-available technology?

Other countries can benefit from following China’s example

Benxi is just one of several Chinese cities applying modern district energy solutions, and it is a solid example of how modern technologies can create results fast when put into play. District energy is also the perfect infrastructure investment for other countries, which have similar rapid urbanization rates, and which could benefit from following China’s example.

To seize the potential, we must accelerate the implementation of the best available technology, and the world’s leaders can help make it happen by providing motivating frameworks and incentives to invest. One key implementer is Sustainable Energy for All (SE4All). I encourage you to join SE4All and the energy efficiency movement today. Meanwhile, China has got it right by using energy efficiency to fast track the reduction of CO2 emissions. ■

1 Source: Global Tracking Framework. P2

2 Report: Urban China: Toward Efficient, Inclusive, and Sustainable Urbanization

3 UNEP and UNHABITAT, ”District Energy in Cities: Unlocking the potential of Energy Efficiency and Renewable Energy February 2015

Niels B Christiansen is the President & CEO of global group Danfoss A/S, which produces and sells an extensive range of energyefficient products and services. Danfoss is also a world leader in mobile hydraulics and provides solutions for renewable energy such as solar and wind power.

Niels B. Christiansen has a broad experience of leading large global high-tech companies.

He joined Danfoss in 2004 as Executive Vice President, and became Chief Operating Officer in 2005. He became Vice CEO in 2006 and President and CEO in 2008.

Before joining Danfoss, Niels was Group Executive Vice President at GN Store Nord, and before that President & CEO of GN Netcom. He has also held leading positions at McKinsey & Co., and Hilti Corp., Switzerland.

Niels B. Christiansen holds an MSc in Engineering from the Technical University of Denmark and an MBA from INSEAD in France.

Infrastructure POPULATIONS AROUND THE WORLD ARE MOVING INTO CITIES, CREATING A HUGE DEMAND FOR INFRASTRUCTURE. WITH TECHNOLOGIES AVAILABLE TODAY, CITY DEVELOPERS CAN BUILD THIS IN A SUSTAINABLE AND EFFICIENT WAY.

Authored by: Chris Southworth

Brexit means Brexit

Brexit means Brexit is what we are being told by UK officials. In reality, we don’t know what Brexit means other than the UK will be leaving the EU. What comes next is unknown.

Froman international point of view, Brexit has come at an unwelcome time for the rest of the world and will have added more uncertainty and complexity at a time when G20 trade performance is weak and protectionis rhetoric is on the rise. G20 leaders have an ideal opportunity to rebalance the message and inject confidence into the economy.

The EU referendum exposed a severe disconnect, anda lack of basic knowledge and awareness about the benefits of trade to local communities and economies. If ever there was a reminder of how powerful perception can be over reality, the referendum was it. For the most part, the trade debate was wholly uninformed at a ground level, even amongst experienced, well qualified business leaders. This is a stark lesson for the G20- which can feel a very long way away from reality for a business leader running an SME. If this can happen in a country that is famously open to trade, then the sentiment can easily translate to countries that are more inclined to be protectionist by nature. In the UK, as in other parts the world, there is a burning need to re-connect and re-educate the populous about the benefits of trade. Business leaders must play a role in reclaiming and promoting this narrative.

There are already rumblings overseas of frustration and impatience with the UK for creating a self-inflicted problem. It is hard not to empathise with this view but it is a mistake to think Brexit has nothing to do with G20. Between now and the general election in 2020,

there will be elections in Austria, France, Germany, Italy, Latvia, the Netherlands, Sweden, Romania, Russia and the US.. The risk of rising populism and protectionism is significant. G20 leaders must use the Chinese and German G20 cycles to re-focus messaging and build policies that resonates with local realities or businesses could be facing a hostile international business environment for many years to come. The consequences, as is usually the case, will impact SMEs, emerging markets and poorer communities, who will ultimately feel the impact of jobs being created or lost.

From an economic and regulatory perspective, the UK-EU interface plays a critical role in enabling a stable flow of worldwide capital, goods and services. SMEs and supply chains in the EU and elsewhere are reliant on this flow to generate opportunities, growth and jobs. A quick solution to securing UK access to the EU single market, and putting in place

measures to prevent regulatory divergence, is in everyone’s interests.

The G20 China Summit comes at a difficult time for the UK government who have their hands full finding solutions to some very practical hurdles; creating a new trade negotiation team, consolidating a major government re-structure and engaging World Trade Organisation members to gauge the post Brexit possibilities. These are all issues that will consume the UK government for some time but, in terms of scale of importance, providing certainty on single market access has to be top of the list and the one that matters most for international businesses with UK investments.

By Spring 2017, after the next two quarterly rounds of economic results, we will have more concrete evidence of the impact of the referendum on investment decisions being taken now. Whatever happens next, we can

be confident the UK is a resourceful nation and will find solutions; it always does, but looking at Brexit as a UK problem is a mistake.

For G20 leaders, a stable UK-EU interface will be a priority. The last thing the world needs right now is an economy as large as the UK floating in a long period of uncertainty.

Now, more than ever, B20 requires strong business leadership to keep a steady hand on the trade and investment tiller whilst the UK and the rest of the world navigate unchartered waters. There has never been a more important time for international organisations, such as the ICC, to support businesses. ■

Chris Southworth is Secretary General at the International Chamber of Commerce UK. Prior to joining ICC he was Executive Director for Global Partnerships, at the British Chambers of Commerce (BCC), Head of the International Chambers of Commerce Unit at UK Trade and Investment and a Senior Policy Advisor to Lord Heseltine for his independent review of UK competitiveness. In 2011 he helped set up the mid size business export programme at UKTI and was a Senior Policy Advisor for the 2011 Government Review of Mid Size Businesses. Former roles have encompassed deregulatory policy at Better Regulation Executive, social enterprise policy at the Department for Business and stints in a local strategic partnership and the charity sector. He is also co-owner of a start-up company building homes in Cartagena, Colombia.

Hangzhou. China

THE G20 CHINA SUMMIT COMES AT A DIFFICULT TIME FOR THE UK GOVERNMENT WHO HAVE THEIR HANDS FULL FINDING SOLUTIONS TO SOME VERY PRACTICAL HURDLES; CREATING A NEW TRADE NEGOTIATION TEAM, CONSOLIDATING A MAJOR GOVERNMENT RE-STRUCTURE AND ENGAGING WORLD TRADE ORGANISATION MEMBERS TO GAUGE THE POST BREXIT POSSIBILITIES.

Authored by: Jamal Malaikah

Saving Doha, Part II: Plurilateral Sectoral Tariff Initiatives

Ayearago, in an article titled “Saving Doha: Focusing on Priority Issues”, I underlined the importance of the continued liberalization of trade for the business community at large and provided three ideas to revive the moribund Doha Development Agenda (DDA). A year later, I review the progress made and the merits of plurilateral sectoral tariff initiatives, an option to improve trade and deliver much-needed benefits in the short to medium term.

Progress on the three DDA priorities since last year?

Achievements at the World Trade Organization’s (WTO) 10th Ministerial Conference that was held at Nairobi were modest. The “Nairobi Package” only includes six ministerial decisions on agriculture, cotton and issues related to least-developed countries.

Despite last-minute efforts to have a decision on transparency-related issues regarding anti-dumping and countervailing proceedings, differences between WTO

Members were irreconcilable and no agreement could be reached. As highlighted in the latest Report from the WTO DirectorGeneral on Trade-Related Developments, trade remedies remain a serious impediment to trade. However, in view of recent exchanges within the Negotiating Group on Rules, which is mandated to improve and clarify anti-dumping and countervailing rules, any progress is unlikely in the near future.

No significant progress could also be achieved in the negotiations on market-

At a time where economic recovery remains weak the business community must engage to help restore conditions for sustainable economic development.

access for non-agricultural goods (NAMA).

The Nairobi Ministerial Declaration recognized that WTO Members have different views on how to address the DDA negotiations. While some WTO Members are committed to concluding the DDA in line with its original mandate others call for its termination and the development of new approaches. As recently recognized by G20 Trade ministers, plurilateral sectoral tariff initiatives are a mean to achieve further liberalization in key economic sectors while accommodating the interests of the majority of WTO Members.

On a positive note, significant efforts have been made on the ratification of the Agreement on Trade Facilitation (TFA). A total of 87 WTO Members has ratified the TFA, more than three-quarters of the ratifications needed to bring the agreement into force. The TFA can thus be expected to enter into force in the short term and reduce trade costs by 15 percent.

The interest of business for plurilateral sectoral tariff initiatives

During the Trade Dialogues, an event held in May of this year at the WTO headquarters in which business leaders highlighted the challenges and opportunities before them and shared their views on how the WTO can help address these, participants stressed the significant trade-restrictive effect of tariffs. With the development of global manufacturing and the international fragmentation of global value chains, the cumulative effect of tariffs along the supply chain amplifies their impact. To address tariff barriers, business leaders proposed “delivering more plurilateral and sectoral agreements at the WTO to reap quick wins”.

Plurilateral sectoral tariff initiatives are not new. In the Uruguay Round, the last successful round of global trade negotiations, these were used to liberalize trade for a great range of products as diverse as agricultural equipment, chemicals, construction equipment, furniture, paper, steel and toys. More recently, WTO Members concluded the Information Technology Agreement and some are negotiating an agreement on environmental goods.

The Chemical Tariff Harmonization Agreement (CTHA), which provided for tariff liberalization and harmonization in the Uruguay Round and has since been used as a standard for countries acceding to the WTO, is a good example of a successful plurilateral sectoral tariff initiative. It could be used by its signatories and the other leading chemical producing and trading countries as a basis for the complete liberalization of tariffs on trade in chemicals.

Key benefits of sectoral tariff initiatives

Plurilateral sectoral tariff agreements have a number of benefits. They are easier to negotiate than global agreements, particularly if supported by the industry, because they are narrower in scope. Also, they can be implemented rapidly and not delayed by the “single undertaking” approach of the DDA. Furthermore, these agreements are, by definition, concluded only by interested countries. However, they must be concluded by countries that account for a “critical mass” of world trade to be operational.

From a business perspective, plurilateral sectoral tariff agreements result in a significant reduction in trade barriers and support the emergence of global value chains. These agreements also facilitate the participation of small and medium enterprises, including from least developed and developing countries, in world trade by promoting competition with the dismantling of barriers on key industrial inputs.

How can the business support sectoral tariff initiatives?

As in all trade negotiations, industries must be the driver for change. They must call on their governments to rapidly initiate plurilateral tariff negotiations in sectors where further liberalization can be achieved and would result in significant cost reductions. At a time where economic recovery remains weak and uneven and the DDA is stalled, the business community must actively engage to help restore conditions for sustainable economic development. ■

PLURILATERAL SECTORAL TARIFF AGREEMENTS HAVE A NUMBER OF BENEFITS. THEY ARE EASIER TO NEGOTIATE THAN GLOBAL AGREEMENTS, PARTICULARLY IF SUPPORTED BY THE INDUSTRY, BECAUSE THEY ARE NARROWER IN SCOPE.

Jamal J. Malaikah is President and Chief Operating Officer (COO) of National Petrochemical Industrial Company (NATPET) since 2008. Previously, he was a Managing Director of Copak, Egypt and a Senior General Manager of Saudi Carton Company. He held senior positions in several projects at Xenel Industries Limited, Saudi Arabia. Jamal is a member of the Boards of Directors Memberships of Al Ahli Takaful Company (ATC), Public Insurance Company in Saudi Arabia. He is also a member of the Petrochemical Manufacturers Committee (PMC), Saudi Arabia and a member of Turkey’s B20 Trade Taskforce having previously been a member of Australia’s B20 Trade taskforce.

Hangzhou. China

The History of Trans Maldivian Airways

The Maldives has shown that travel to even the remotest and unspoilt archipelagos on the planet is attainable. The islands’ striking beauty, combined with luxury resorts, would not be as accessible as they are if it wasn’t for a handful of daring people. They turned their passion into a service benefiting visitors, resorts and Maldivians alike.

How it started

The Maldivians undertook voluntary work in order to build their own airport and in 1966 Male saw the first commercial landing.

The few adventurous travelers who came to the Maldives in the following years were limited to exploring the pristine islands close to Male. The natural and untouched beauty of the islands started to appeal an increasing number of inquisitive travelers, and the first resorts opened in 1972, all within reach of boat from Male.

Maldivian Air Taxi

Almost ten years later, with infrastructure problems relating to the established helicopter air service, and the many resorts still only reachable by boat, the idea of faster and more convenient travel was about to be floated.

Traveling to Kuredu in 1991, Lars Erik Nielsen recalls ‘The passengers were so sick on the voyage, I had to find a better way to travel!’ And he did. With his love of seaplanes and the much needed Scandinavian entrepreneurship, he started Maldivian Air Taxi. From its humble beginnings in 1993 with

only two aircraft, the company transferred over 500,000 passengers per year.

Trans Maldivian Airways

The beginnings of aviation in the Maldives are to be undoubtedly attributed to Trans Maldivian Airways. TMA started in 1989 as a company operating a helicopter fleet under the name Hummingbird Island Helicopters. Eight years later the name was changed to Hummingbird Island Airways, as the first seaplane was added to the fleet. The transition to a seaplane-only fleet was completed in 1999. A year later, the name Trans Maldivian Airways name came to be, and still today represents a synonym for connecting the Maldives islands. TMA is the oldest air services operator in the Maldives and has grown to become the largest seaplane operator in the world.

Lars Petré, Hussain Afeef and Mohammed Moosa, the brains and investors behind the first air services operator in the Maldives, changed not only visitors’ experience but also the country for the better. Petré believes that ‘seaplanes will remain the best way to travel

in the Maldives’. Transporting about 400,000 passengers per year, and new resorts being built, TMA has, too, become a trendsetter in the global tourism industry.

What it has come to be

In February 2013 Maldivian Air Taxi (MAT) and Trans Maldivian Airways (TMA) partnered with Blackstone, one of the world’s leading investment and advisory firms. A private equity fund managed by Blackstone on behalf of its private equity investors acquired a controlling interest in the two companies. The founders and majority shareholders of both MAT and TMA will continue to play a significant role in the new merged company, under the name of Trans Maldivian Airways.

Mr. Lars Petré said “We have partnered with Blackstone, one of the leading private equity firms in the world, to help take our business and tourism in the Maldives to the next level. The Maldivian economy will gain from the presence of one of the world’s largest and most respected investment firms.”

Mr. Lars Nielsen stated “We are extremely

Branded Story / Trans Maldivian Airways

happy to partner with Blackstone in the combined enterprise. With their strong network and operational focus, Blackstone will contribute significant value to the venture. This will be beneficial to the employees and enhance their career growth. In addition, together we look forward to delivering more efficient services to the tourists coming to the Maldives and the resorts in which they are staying. This combination will increase service efficiency to our resorts.”

Mr. Hussain Afeef further added “We are committed to playing a significant role in building the tourism industry in the Maldives.

Blackstone will bring to Maldives a wide global experience and an established track record in the tourism and hospitality sector. Incorporating global best practices would be beneficial, not just to the companies, but to the tourism industry in general.”

Together the two airlines operate 46 seaplanes including three new DHC-6-400 series and conduct well over 100,000 flights per year making them the world’s largest Twin Otter operator on land or sea. Together the companies employ around 1000 people and service more than 60 resorts, safari boats and liveaboards and carries close to a million passengers a year.

Trans Maldivian Airways

Some key facts:

› TMA has transferred close to a million passengers annually since the merger.

› TMA currently has a fleet of 46 Twin Otter Aircrafts on floats. (This includes the New 400 series of the twin otter aircraft manufactured by Viking air in Canada and one aircraft configured with the VIP seat configuration)

› TMA has over 1000 staff working under the company.

› TMA has close to 200 pilots out of which 50 % is consists of Maldivian Pilots.

› TMA has over 20 different Nationalities of staff members working in mixed groups.

› TMA has over 23 different dedicated resort lounges.

› TMA services to over 60 different resort islands.

› TMA has won the World’s leading Seaplane operator and the Indian Oceans leading Seaplane operator under World travel awards in 2014.

› TMA has played a major role in the growth and expansion of the Tourism throughout the country by being the most reliable and convenient way of transportation provider for the tourists arriving to the Maldives.

› TMA has a dedicated lounge service provided to resorts that do not have dedicated lounges and require to provide VIP services, to accommodate CIP’s etc.

› TMA has dedicated VIP vehicles to cater for the requirement for accommodating VIP transfers. ■

Following link have relevant information regarding:

ISO Certification: www.transmaldivian.com/iso-ohsas-certifications/ Trans Maldivian Airways Celebrates 25 Years of Service Excellence. www.transmaldivian.com/tma-celebrates25-years-of-service-excellence/ Trans Maldivian Airways Pilot Scholarship training Program: www.transmaldivian.com/pilot-scholarshipprogram-winners/

TMA has played major roles in contributing to the local community: www.transmaldivian.com/maldivianthalassaemia-society/ www.transmaldivian.com/flying-green-fund/ TMA route MAP: www.transmaldivian.com/north-of-male/ www.transmaldivian.com/south-of-male/ Social Media: www.facebook.com/transmaldivianairways www.twitter.com/TransMaldivian www.youtube.com/user/MaldivesTMA

Hangzhou. China

Image: Ulrike Van Eden

BUSINESS MATTERS.

Chairman: Marcus Wallenberg Chairman, SEB (Sweden)

Danfoss Group Industrial Company Company