Opening remarks at the B20 Conference "From Aspiration to Business Action: the 2030 Agenda as a driver for responsible business and anti-corruption in infrastructure development"

by Parliamentary State Secretary Thomas Silberhorn, 27 January 2017, Berlin

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Members of the B20,
Esteemed guests,

I. G20 and B20 – Making progress on the 2030 Agenda

The G20 is an example of globalisation in action. It brings together the leading industrialised and emerging market economies: they represent almost two thirds of the global population, more than four fifths of global GDP and three quarters of worldwide trade.

The G20’s advantage lies in its convening power and its collective ability to adopt and support policies and initiatives at the highest political level. This enabling environment is urgently needed to advance the ambitious 2030 Agenda for Sustainable Development, adopted in September 2015. The G20 has decided to focus on sectors and themes of the 2030 Agenda where it can add value as a global forum for economic cooperation.

The G20 Action Plan on the 2030 Agenda, adopted in 2016 in Hangzhou, China thus reflects the G20’s collective actions towards sustainable development and includes the following sectors: sustainable infrastructure, anti-corruption, domestic resource mobilisation, and also financial and inclusive business along global supply chains. 

These are areas that concern government and business in equal measure. Today’s challenges are far too large to be solved by governments alone! Exchange and cooperation with groups such as the "Business 20" are key for us. We are therefore keen to hear your thoughts today!

II. Focus of the German G20 presidency: Africa

We need to turn our attention to those countries which are still facing major challenges to sustainable development. In Africa alone, around 360 billion US dollars of investments will be needed between now and 2040 in areas such as transport, energy, water, waste or ICT technologies. Over 50 million young people in Africa are in precarious employment. Youth unemployment stands at 50 per cent. The continent needs some 20 million new jobs each year!

To tackle these challenges in 2017, both Germany and the European Union are turning the spotlight on Africa. Germany is making the continent a focus of its presidency of the G20. The EU is working on a new Africa strategy, defining cooperation after the expiry of the Cotonou Agreement. To shape these processes my minister, Dr. Gerd Müller, recently presented a blueprint for a Marshall Plan with Africa, reaching far beyond traditional development policy. The goal is to improve investment conditions in African countries and to increase investment incentives for businesses in Germany and Europe. ODA funds will be used to leverage private investments by supporting suitable funds or expanding guarantee instruments for both exports and investments.

We want to establish a pact on the future between Africa and Europe for more economic engagement and sustainable development. By doing this, we can help to create job opportunities and prospects for the future, and we can contribute towards promoting sustainable, resource efficient technologies and innovations. This will help to stabilise African countries and reduce the causes of migration.

III. Our take on responsible business conduct and anti-corruption

I understand that the B20 Group on Responsible Business Conduct and Anti-Corruption is currently drafting a policy paper on "responsible business conduct and anti-corruption in infrastructure development". I look forward to your recommendations, which will be presented to the G20 leaders this summer.

Let me give you some insight into our understanding of the subjects and some concrete examples of the work being done by our Ministry in this regard:

1. Corruption

According to the World Bank Institute, 20 to 40 billion US dollars a year are lost due to corruption in developing countries. Corruption has a corrosive effect on societies as a whole and particularly affects poor and vulnerable communities. Corruption is a problem which needs to be tackled by collective action. This is also one of the findings of the 2016 Corruption Perception Index published this week, which calls on the G20 to act.

One way we aim to support the fight against corruption is by backing initiatives such as the Alliance for Integrity, which is supporting today’s event. (The Alliance is a multi-stakeholder partnership which offers practical solutions to strengthen the compliance capacities of companies and their supply chains, through peer-to-peer learning, public-private dialogue and other approaches.) We are also actively supporting initiatives within specific sectors, such as the Water Integrity Network. (The network brings together donors and international organisations, including Transparency International. Together with the network, we have developed an integrity toolbox for water suppliers, which has been piloted in Kenya.)

2. Responsible Business Conduct

Responsible business conduct also implies respecting all three dimensions of sustainability – economic, social and ecological. We have therefore increased our cooperation with businesses and founded some successful alliances. One example is the Partnership for Sustainable Textiles (Textilbündnis), which now has more than 180 members. Together they account for around 55 per cent of the retail turnover in the German textiles sector. They have all committed themselves to improving social and environmental conditions along their supply chains. This includes, for example, making sure that seamstresses in Bangladesh have a safe working environment and get an appropriate income, or that farmers in Africa get a fair price for their cotton. This is responsible business in action!

Responsible business also extends to paying a fair share of taxes and reducing harmful tax-avoidance strategies, thereby demonstrating responsible tax behavior and corporate tax transparency. The Panama Papers have shown the importance of this agenda. Corporate tax revenues are very important for financing spending on items such as education, health and large infrastructure projects.

3. Infrastructure projects

Responsible business conduct is particularly important in the case of large infrastructure projects, as they have substantial impact on society and the environment as a whole. Promoting sustainable infrastructure development and quality infrastructure investment contributes to achieving SDG 9, "building resilient infrastructure", by ensuring inclusive growth, climate-friendliness, environmental awareness and social sustainability.

Emerging economies in particular are a crucial factor in the widening of the existing global demand-supply gap in the context of infrastructure investment. By 2025, infrastructure spending in the Asia Pacific region is expected to account for nearly 60 per cent of global infrastructure spending. This highlights the major global implications that emerging economies’ policy decisions are bound to have. Networks such as the Emerging Market Sustainability Dialogues, which also co-organised today’s event, are seeking to strengthen cooperation and knowledge exchange between emerging and industrialised economies on sustainable policy, business, and finance, so as to promote sustainability in these countries’ policies.

IV. Conclusion and expectations

These examples show us that a meaningful outcome in the international process depends on a dynamic and continuous exchange between all stakeholders. And a successful G20 summit depends on your valuable input and recommendations.

I would like to say once more, on behalf of the German Federal Ministry for Economic Cooperation and Development, thank you for participating in this process.

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