A view on UNCTAD's World Investment Report 2014

By: Veronica Velásquez Zuluaga* vvelasq5@eafit.edu.co

Law student at Universidad EAFIT, Colombia

According to the UNCTAD, the foreign direct investment (FDI) has increased all types of economic groups, developed, developing and transition. One of the points of the agenda of the countries is to create or elaborate policies to attract investment in their own country regardless of their economic group.

Recently, an investment promotion agency mentioned that the main objective of investment incentives is job creation, followed by technology transfer and export promotion. To achieve this objective, it has to take into account four key challenges: The first one is leadership, this key propose setting guiding principles ensuring policy coherence; the second is mobilization and propose to reorient markets towards investment in SDGs; the third is channeling and pose the promoting and facilitating investment into SDGs sector; and the last one is impact and express the maximization of the development benefits and minimizing risks.

There is an important aspect and is related to the investment of the private sector in all countries. The private sector cannot supplant the big public sector push needed to move investment in the SDGs in the right direction. But an associated big push in private investment can build on the complementarity and potential synergies in the two sectors to accelerate the pace in realizing the SDGs and meeting crucial targets. Private sector contributions often depend on facilitating investments by the public sector. In some sectors such as food security, health or energy sustainability, publicly supported research and technological development (R&D) investments are needed as a prelude to large-scale SDG-related investments.

SDG investment has some approach: the first is economic infrastructure in developing countries, included power, transport, telecommunications and water and sanitation, we can say private sector has a good participation in these topics; another approach is food security and the corporate sector contribution in the agricultural sector as a whole is already high at 75 per cent in developing countries, and is likely to be higher in the future; the third one is Social infrastructure is related to education and health, is a prerequisite for effective sustainable development, and therefore an important component of the SDGs; and the last one is environmental sustainability, including stewardship of global commons, the investment gap is largely captured through estimates for climate change, especially mitigation, and under ecosystems/biodiversity (including forests, oceans, etc.).

We can say private sector intervenes so much in the economy and all their movements can change other sectors such as economy, environment, infrastructure, transport etc.

Reference

UNCTAD (2014) World Investment Report 2014. Available online at: http://unctad.org/en/PublicationsLibrary/wir2014_en.pdf

Bio-agricultura urbana: ¿cómo producir alimentos en escenarios de cambio climático?

Articulo de opinión por: Adriana María Gallego Rúa* (adriana.gallego.02@gmail.com)
Laboratorio de Biotecnología, Universidad de Antioquia, Colombia

Hoy en día reconocemos que el cambio climático es una realidad inminente. Son muchos los pronósticos que se plantean de cómo se verá el globo terrestre dentro de unos años con el calentamiento global… el derretimiento de los polos, la inundación de las costas, el efecto negativo en los cultivos… son noticias que a diario nos invaden.
Apagar las bombillas, usar más la bicicleta y menos el carro, ahorrar agua… son todos paños de agua tibia. Falta una mayor conciencia sobre varias preguntas inquietantes pero necesarias...
¿Cómo nos alimentaremos en el futuro bajo los evidentes pronósticos de cambio climático? ¿Cómo hacer de la seguridad alimentaria y energética una realidad sustentable en el tiempo?. Sin duda son más las preguntas que las soluciones tangibles.
Transformar la agricultura tradicional a una agricultura de policultivos es una de las soluciones propuestas y es válido… sin embargo ¿si la transformación toma más tiempo que los efectos del cambio climático en recrudecerse? ¿Cuál será nuestro as bajo la manga?
Pensar que el campo va a desaparecer es una utopía, pero creer que estará eternamente disponible para la agricultura mundial si lo es. Si seguimos pensando en depender 100% del campo para la alimentación y recurso energético considero, vamos por el camino equivocado. Surge aquí el concepto de Bioagricultura urbana. Pensar que podemos producir alimentos que no dependan del campo, que se establezcan en espacios pequeños, que sean independientes de factores climáticos externos, libres de patógenos y agroquímicos, sin estacionalidad… suena como un cuento sacado de la ciencia ficción. Sin embargo es posible. Actualmente hay unos esfuerzos investigativos en hacer esta idea tangible y se han obtenido resultados positivos. Bien decía Albert Einstein “No podemos esperar un cambio si seguimos haciendo lo mismo”. Es por esto que la Bioagricultura Urbana se constituye actualmente como un cambio de paradigma.

Report. Videoconference: UNCTAD's Trade and Environment Report

Report by: Carolina Herrera Cano* (caroherca@gmail.com)
International Business at Universidad EAFIT, Colombia

Videoconference availlable here. 

Recognizing the multifunctionality of agriculture

Today, the Trade, Investment, and Development Observatory had the opportunity to assist to the conference “Assuring Food Security and Rural Livelihoods under the Challenges of Global Warming” by Dr. Ulrich Hoffman. This conference was based on the Trade and Environment Review 2013: Wake up before it is too late: Make agriculture truly sustainable now for food security in a changing climate, whose Principal Editor is Dr. Hoffman.

The power and importance that the agriculture sector has is undeniable. Food supply, industry, and also labor depend on this economic activity; certainly agriculture is a multifunctional sector. This ancient practice has evolved through decades, but it seems that this process of evolution is not being enough, compared to the emerging problems related to this sector. This review emphasizes in the necessity to promote a drastic

change in how agriculture is understood nowadays; they highlight the importance of achieving a paradigm shift from a linear perspective, to a holistic approach that can truly understand, and make the most of the multifunctionality of agriculture.

The importance of this change relies on the connection between this sector and problems such as: food security, access to land and water, hunger and poverty, social inequity, poor health and malnutrition, and climate change. As a key conclusion, the review mentions that “agriculture is a major cause and victim of climate change”. Also, despite the decrease in the role of agriculture in the global economy during the last decades, this sector still represents about a 40-60% of the total work force in developing countries. Human dependence on this sector is as evident, as it is the importance of renewing agricultural practices in favor of sustainable development.

The invitation from the Trade and Environment Review 2013 is to promote sustainable practices that can actually redefine “productivity”, strengthen resilience to resources, and that can create changes in inequity around the world. Decisive and coordinated action between the private and public sector is vital; as well as it is a redefinition of sustainability as an “organic, ecological, and resilient” concept. Recognizing the multifunctionality of agriculture will decisively promote sustainable, and inclusive development.

Reporte de teleconferencia: Metodología de estudio cadenas globales de valor: una estrategia de eficiencia y productividad

Reporte de videoconferencia por: Nathalia Rios Ballesteros* (nriosba@eafit.edu.co) 
*Estudiante de Economia y Negocios Internacionales, Universidad EAFIT, Colombia

• Conferencistas: Nahuel Oddone , y Ramón Padilla Pérez
• CEPAL, Sede subregional de México
• Fecha: Lunes, 12 de Mayo 2014

Cadenas globales de valor: una estrategia de eficiencia y productividad 

En las últimas dos décadas, América Latina ha sido víctima de lo que se puede catalogar como una “revolución productiva”, la cual ha liderado amplias reformas económicas encaminadas a expandir las fronteras comerciales, absorber inversión extranjera y posicionar a los países de esta región en el panorama internacional. Sin embargo, dichas reformas no han brindado resultados según lo esperado; las exportaciones, por ejemplo, no han resultado ser un motor de crecimiento económico sostenido ni de generación de empleos lo cual podría estar fuertemente asociado al bajo valor agregado de la oferta exportable nacional (Odonne y Padilla, 2014). Por lo anterior, y a raíz de la crisis de 2008, los gobiernos latinoamericanos han aumentado su presencia e intervención en el marco de políticas industriales con el fin de fundamentar planes eficientes e integrales de participación productiva y mejoramiento en la inserción e implementación de cadenas de valor, nacionales e internacionales, que permitan generar mayor valor agregado y obtener mayores beneficios económicos a partir de la participación activa en estas últimas. Estos planes, según Oddone y Padilla, permiten estudiar el papel de los servicios profesionales y de soporte en el aumento del valor agregado nacional y el fomento de la modernización tecnológica en las cadenas de valor agroindustriales, lo cual se evidenció a través del estudio de dichas cadenas en la evaluación de la producción agregada de camarón de cultivo y vegetales no tradicionales en el Salvador y la producción de maderas finas en Guatemala.

Para fundamentar la relación estructural entre valor agregado y producción nacional mencionada anteriormente, Nahuel Oddone y Ramón Padilla, desarrollaron una metodología compuesta por 6 pilares, la cual se sigue de siguiente manera; (1) Definición de metas y objetivos. Este pilar, en principio, busca determinar las restricciones y barreras críticas para aumentar el valor agregado y fortalecer las capacidades tecnológicas de cada país, con el fin de identificar las posibles mejoras a implementar, teniendo en cuenta la capacidad productiva de cada economía. (2) Selección de cadenas de valor. En segundo lugar, una vez determinadas las restricciones internas, es preciso determinar la cadena que más contribuye con el desarrollo y cumplimiento de lo establecido en la primera etapa. Esto implica, una estrecha relación entre metas, objetivos y cadenas de valor para que, dentro de una perspectiva microeconómica, se logren resultados positivos en cuanto a los niveles de empleo, exportación, participación de PYMES en los procesos productivos, entre otras cosas. (3) Realización del diagnóstico. Esta etapa resulta crítica a la hora de determinar los rasgos y características representativas de la cadena elegida en la etapa inmediatamente anterior. Esto se logra a través del desarrollo de un exhaustivo cuestionario, diseñado por los autores, basado en la información disponible o suministrada por fuentes oficiales con el fin de determinar la información existente sobre esta cadena. La información que resultada desconocida a posteriori, se determina en el país de selección a través de la presencia y el apoyo de los diferentes actores locales vinculados al proceso. Los resultados obtenidos en esta etapa, al igual que la evidencia empírica y el análisis que lo sustenta, es validado y evaluado por medio de la realización de mesas de diálogo llevadas a cabo el país de estudio. (4) Desarrollo e implementación de mejores prácticas. Este pilar permite superar las restricciones encontradas en la primera etapa, a través de la implementación de mejores prácticas internacionales que provean a los procesos productivos existentes de productividad y eficiencia para aminorar y, si se puede, eliminar las restricciones presentes en la economía. (5) Elaboración de estrategias. Este pilar concibe el desarrollo y la implementación de acciones microfundamentadas bajo un enfoque sistemático, es decir, en donde exista interconexión de los diferentes eslabones y etapas dentro de la cadena de valor. Una vez establecidas estas estrategias, se procede a la segunda mesa de diálogo, a partir de la cual, se definen las acciones conjuntas, público-privadas, con el fin de discutir y finalmente escoger las estrategias que resultan adecuadas para proceder con su implementación. (6) Lanzamiento. Como última instancia, se concibe la publicación oficial del proyecto por parte del gobierno en cuestión, a través de un evento mediático, en el cuál se informe a los ciudadanos sobre los compromisos y estrategias adquiridas para mejorar las condiciones internas asociadas a las mejores prácticas productivas. Dicho lanzamiento, viene acompañado de proyectos de supervisión y monitoreo constante acerca de la dinámica asociada al proceso de la buena inserción de estas cadenas en la economía.

Consecuente a lo anterior, se puede afirmar que el gobierno juega un papel importante en el fomento
tanto de la oferta como de la demanda de servicios profesionales y de soporte que buscan generar valor agregado en el proceso productivo nacional a través de la inclusión y participación activa de cadenas de valor nacionales e internacionales por parte de los países caso de estudio. Es así como; las organizaciones públicas y su buena gestión en incentivar y apoyar a las pequeñas y medianas empresas en la inclusión productiva; la prestación de asistencia técnica a productores nacionales y a otros eslabones de la cadena de valor por parte de los centros públicos de investigación y organismos públicos sectoriales; la generación y el desarrollo de iniciativas públicas dirigidas a financiar el acceso a servicios profesionales y de soporte para todos los actores de la cadena de valor; al igual que el desarrollo de sistemas públicos que resulten eficientes y productivos para la implementación de mejores prácticas internacionales a fin de favorecer la producción nacional disminuyendo las restricciones de “éxito productivo” existentes, resultan ser funciones claves para el buen desempeño de este tipo de proyectos en los países latinoamericanos.

Videoconference: Trade and Environment 2013

The Virtual Institute of the United Nations Conference for Trade and Development (vi UNCTAD), and the Trade, Investment and Development Observatory invite to the videoconference from Geneva (Switzerland) By. Dr. Ulrich Hoffmann, led author of the Trade and Environment Review 2013: Wake up before it is too late: Make agriculture truly sustainable now for food security in a changing climate.

• Date: Monday 26th May 2014
• Time: 9:00am - 11:00am (Colombian Time, GMT+5)
• Location: Bl. 19-513, Universidad EAFIT, Medellin, Colombi

Dr. Ulrich Huffmann is the Head of the Trade and Sustainable Development Section at the secretariat of the United Nations Conference on Trade and Development (UNCTAD) in Geneva. He is a member of the steering group of the FAO/IFOAM/UNCTAD International Task Force on Harmonization and Equivalence in Organic Agriculture and the FAO/IFOAM/UNCTAD project on facilitating global market access for organic produce. He also worked extensively on national programmes on Good Agricultural Practice and related commercial GAP standards in several developing countries. Mr. Hoffmann is the editor in chief of UNCTAD's annual Trade and Environment Review, which has recently paid prime attention to voluntary sustainability standards. He is currently part of a preparatory committee of FAO, ITC, UNCTAD, UNIDO and UNEP, which prepares the launching of a UN Forum on Sustainability Standards.

Biodiversity and Access to Sustainable Development

Opinion article by: Marcela Marin Mira* (mmarin@eafit.edu.co ) 

International Business student at Universidad EAFIT, Colombia

The United Nations Conference on Trade and Development - UNCTAD's Division on International Trade and Commodities, which seeks the promotion of inclusive and sustainable development in international trade, launched the BioTrade Initiative in 1996. This Initiative, being the longest running United Nations initiative on business and biodiversity, has focused its efforts on supporting the Convention on Biological Diversity (CBD) and has developed programs for different regions and countries to enhance the sustainable bio-resources management, product development, value adding processing and marketing.

As stated by the CBD, “Biodiversity is the source of many products and services utilized by society and its sustainable use is thus fundamental for long-term sustainable development”, and that is why it is of great importance to work on the integration of groups of businesses and communities, governments, universities, trade promotion organizations, chamber of commerce and regional and international organizations in order to meet the BioTrade Target, achieving a significant reduction of the rate of biodiversity loss, as this goal has failed to be achieved in the past without counting on effective and rapid responses.

Leading BioTrade to businesses is not only about ensuring the conservation of the environment but also mitigating the negative impacts on the populations, particularly those disadvantaged populations into the world economy.

The Millennium Ecosystem Assessment (MA - initiated in 2001) that has the goal of assessing the current condition and trends in the ecosystems and the services they provide (such as food, clean water, forest products, flood control and natural resources) to give options looking forward its restoration, conservation, sustainable usage and contribution to human well-being has conclude, in one of its reports, that 60% of the world’s ecosystems are degraded or unsustainably used and are directly impacting the livelihoods of the populations that depend on these resources.

The above reasons have moved many countries to implement sustainable management plans and legal frameworks. To mention we have Bolivia which has succeed by using the basis of a land-use planning model in cooperation with the European Commission that promotes sustainable development, protecting the rights of indigenous peoples living in affected areas. In Southern Africa, the concentration on the development of products derived from native biodiversity has benefited many producers. In the Peruvian Amazon, a big amount of rural families participate in the extraction of Camu-camu (native tree). In Namibia, Marula to harvest trees is very easy and is a means of opportunity for rural women.

On the other hand, we have the formulation and implementation of policies such as the EU Novel Foods Regulation that ensures a high level of human health and consumers’ protection.

After the Second World War the human-being started to think the environment as an important issue for an integral development, but it was in the period from 1972 to 1992 where this concern had the greatest expansion, because the countries around the world began to consider it as part of a juridical framework. After 1992, when the Rio Declaration on Environment and Development (includes 27 environmental principles) took place, we have noticed some advancement on this matter, but not as influential as it should be in the International Law.

Unless biodiversity is still an emerging trend, it is expected to accelerate in the years to come, because producers and consumers are, increasingly, understanding what biodiversity is and valuing its importance.

References

CBD (2014). Obtenido de Convention on Biological Diversity: http://www.cbd.int/gbo3/

Escobar, E. (23 de Marzo de 2012). A magazine on Business and Biodiversity. Obtenido de BioTrade Initiative: http://www.biotrade.org/privatesector4.asp

International Trade and Commodities. (s.f.). Obtenido de UNCTAD: http://unctad.org/en/pages/DITC/DITC.aspx

Millenium Assessment (2014). Obtenido de Millennium Ecosystem Assessment: http://www.millenniumassessment.org/en/About.html#1

Agriculture; the "new economic relief" for developing countries

Opinion article by: Nathalia Rios Ballesteros*(nriosba@eafit.edu.co) 
*Economics and International Business student at Universidad EAFIT, Colombia.

In recent decades, the emergence of global phenomena including globalization, integrated value chains, technological and institutional innovations, environmental restrictions and the growing demand of agricultural goods -which has raised the price of commodities and has expanded the agricultural global market- have positioned agriculture, once again, as a main topic on the global agenda, while providing it with a renewed role in the development process of countries worldwide.

This new role recognizes agriculture’s ability to exert multiple functions towards reaching integral development by stimulating economic growth, environmental sustainability, reduction of poverty and hunger, and achieving higher levels of equity and food security within societies. Likewise, this sector does not only contribute to the food and raw materials production process, but also seeks for the nutrition and healthcare of people. Finally, it is important to mention that different factors such as the new agribusiness trends along with the strengthening of this activity have stimulated interest in the sector as the basic engine for sustainable development and poverty reduction in emerging economies.

For this reason, agriculture has acquired a new perspective in which this activity is considered as a set of linkages and relationships through which societies can foster and raise its standards of living while offering better and wider opportunities to its citizens, thus generating public recognition of this activity as a ‘profitable getaway’ for developing nations.

In this context, it is necessary for emerging economies to define and structure strategic, modern, and comprehensive policies that recognize the multiplicity of social, economic and natural phenomena surrounding agriculture; to promote and strengthen the development of this sector and the rural areas, so that a full and sustainable use of natural resources is achieved, while a dynamic growth of agriculture along with equal social development is ensured. All of the above supported and guided by the promotion of institutional innovation, which allows the development of a variety of organizational arrangements for better mechanisms of public private cooperation, which facilitates agricultural production and growth.

Moreover, present circumstances and future expectations about the course of agricultural production have generated the revaluation of natural resources with agricultural potential which has a positive impact and a special significance for a country like Colombia, which has, along with a small number of nations, abundance in endowment of agricultural resources, not yet fully exploited. This is why, considering the growth prospects of the global food demand by 2050 (FAO, 2012) and the role of agriculture today and for the future, it is estimated that in the exporting countries of agricultural goods, agriculture could become a central pillar of economic growth and development (Fedesarrollo, 2013)

References:

FAO. Food and Agriculture Organization of the United Nations. (Junio de 2012). World agriculture towards 2030/2050: the 2012 revision. Recuperado el 07 de 02 de 2014, de http://www.fao.org/fileadmin/templates/esa/Global_persepctives/world_ag_2030_50_2012_rev.pdf

Fedesarrollo. Fundación para la Educación Superior y el Desarrollo (Fedesarrollo). (2013). Políticas para el desarrollo de la agricultura en Colombia. Recuperado el 7 de 02 de 2014, de http://www.fedesarrollo.org.co/wp-content/uploads/2013/07/Libro-SAC_Web.pdf

Colombia: A country where everything happens and nothing ever happens

Opinion article by: Catalina Tamayo Posada* (ctamayo8@eafit.edu.co) 

Economics students at Universidad EAFIT, Colombia

If you think about it you will realize that it is actually true. Some many things happen in this magnificent land but we, the Colombians, do nothing about it. It is not necessary to go back in time to see that indifference has always been part of our culture. For instance, the agricultural strike.  For almost 3 weeks Colombian farmers and workers from different sectors have been protesting against the Government because of the lack of policies that can protect them and their products. A lot of people argue that all of these protests are only because of the free trade agreements (FTA), but they are not. The problem in Colombia, as I said before, is the enormous absence of policies that can protect and stimulate our own products.

This whole situation has made me ask myself, why don’t we pay attention to the agriculture sector if, for a country like Colombia with all the resources we have, truly investing in it can actually make us more competitive?

Prof. Juan Carlos López Díaz (Universidad EAFIT)

In a conversation with Prof. Juan Carlos Lopez (Director of the Study Group in Business History), we could evidence that this problem has always been there but less has been done to try to solve it, this is what I call indifference. He spoke about what he denominates the three stadiums of industrialization which are the pre-industrialization, the industrialization and the post-industrialization. The first stadium refers to the period where gathering resources from coffee growers and traders established the basis for the industrialization. In addition to this, the war of a thousand days forced the creation of new industries such as the textiles, foods and brewers. All of these circumstances led to the second stadium, which denotes the time of the actual industrialization that is the change from the agriculture to the manufactures. For so long Antioquia was the leader region in terms of industrialization, but after the Second World War and because of issues such as the centralization of the country and the narco-terrorism situation, many companies emigrated to the capital, Bogota, and to Cali. And finally, the services sector is what Prof. Juan Carlos Lopez Díez may call the third stadium. This sector has gained a huge importance because almost all the products require the services sector in one or more ways. In the Colombian case, I think that, in a rush to be as industrialized as other countries, we changed so fast to the manufactures that we did not give the primary sector enough time to fully develop and left it completely forgotten.

What is done is done and there is nothing that we can do to change the past, but it is possible to do something to have a brighter future. It is necessary, and fair, to focus on what we think can make us more competitive. Personally, I do not think that is a matter of choosing whether centering on the agro or the industries. It is about making them work out together, creating value chains, especially on the areas that Colombia has strength on, for example coffee, oil, mining, bananas and flowers.
In conclusion, I would like to say that in order to achieve this enormous goal, we must do an giant effort to invest in technology, infrastructure and education, make more technical the crops in order to be more efficient, reinforce our institutions, and create fair policies that can benefit our farmers. This way we can fully compete in global markets and make our economy grow.