Launch of the joint CAITEC/UNDP report on Fostering Sustainable Development through Chinese Overseas Economic and Trade Cooperation Zones along the Belt and Road.

Honorable Ministers, distinguished delegates, dear colleagues,

I am honored to be here today to officially launch a joint flagship report by the United Nations Development Programme, UNDP, and the Chinese Academy of International Trade and Economic Cooperation, CAITEC, on “Fostering Sustainable Development through Chinese Overseas Economic and Trade Cooperation Zones along the Belt and Road”.

The 2030 Agenda for Sustainable Development and its Sustainable Development Goals lie at the core of UNDP’s mandate. UNDP has been promoting the alignment of the Belt and Road Initiative to the SDGs to help all partnering developing countries maximize the development impact from their engagements with the Initiative – and overall generate global public goods.

Due to its massive scope and scale, the BRI can have a large impact on global development. If coupled and guided by environmental and social sustainability principles and standards, the BRI can also be major driver for the achievement of the 2030 Agenda and play a significant role in closing the financing gaps for the SDGs by leveraging public and private investments.

Chinese Overseas Economic and Trade Cooperation Zones in BRI partner countries serve as platforms for attracting public and private investments that advance infrastructure development, industrialization and job creation. These zones can play a key role in fostering inclusive and sustainable infrastructure development and industrialization that enables sustained economic growth, while creating decent jobs and income, reducing poverty and inequalities, improving health and well-being, increasing resource and energy-efficiency and lowering greenhouse gasses and other polluting emissions. According to data from MOFCOM, over 100 Chinese Overseas Economic and Trade Cooperation Zones have been established or are under construction by 2018; those zones have made total investments of USD 40 billion, paid over 3 billion in taxes to host countries and created over 300,000 local jobs.

Allow me to point to three reasons why this report is important:

First, it analyzes how and to what extent Chinese Overseas Economic and Trade Cooperation Zones contribute to economic, environmental and social sustainability in their host countries. These unique insights are drawn from a first-of-its kind global survey of these zones.

Second, the report presents Practical Guidelines for the creation of Sustainable Chinese Overseas Economic and Trade Cooperation Zones that have sustainability as a guiding principle.

For existing zones, these guidelines provide concrete recommendations on how to adjust their operations to contribute more to the achievement of the SDGs.

For new zones, the guidelines serve as a blue print for getting the design, development and operation aligned with the SDGs from the start.

UNDP has been working on analyzing Chinese enterprises sustainability practices overseas for several years, and these Practical Guidelines contribute well to the overall understanding of outgoing investment and business practices. This comprehensive examination offers a review of existing approaches to economic, environmental and social sustainability practices in special economic zone planning, development and operation. The research was complemented by field studies in Cambodia, China, Egypt, Ethiopia, Indonesia, Nigeria and South Africa.

These guidelines are practical, because they are informed by real-life examples from special economic zones in developing countries that showcase why and how environmental and social sustainability can be successfully pursued hand-in-hand with economic targets.

And third, the report offers concrete recommendations on how to implement the Practical Guidelines, including through the establishment of a model zone that demonstrates how to successfully integrate various aspects of economic, environmental and social sustainability and could serve as concrete reference and inspiration for other zones. Also, the report suggests the creation of an experience and knowledge sharing mechanism to ensure that sustainability approaches are reflected in the zone design and operation from the outset; and exploring innovative financing, for example through triangular cooperation by engaging with development agencies or multilateral funds that aim to foster low-emission and climate-resilient development in the host countries.

To conclude,

The joint report that we are launching today is a concrete outcome of our work in this area with our Chinese partners. We at UNDP look forward to putting these Practical Guidelines into action. We hope this report will serve as a useful input to future work on this topic. Thank you.