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Hitachi Research Institute

Interview

Interviews with experts and opinion leaders from our research network

Thinking About the Global Environment and Sustainable Economic Development

2015 is the final year of the Millennium Development Goals (MDGs) established by the United Nations and is also an important year for a number of events that will have an impact on the future of the global environment. These include the formulation of the Sustainable Development Goals for the period 2015 to 2030 and the holding of the United Nations Framework Convention on Climate Change - COP21 Paris (COP21). To solve the problems of the global environment and sustainable development which the entire world faces, the cooperation and action of all countries is essential. We have invited Ms. Naoko Ishii, CEO and Chairperson of the Global Environment Facility (GEF), established in 1991, to provide financial support for environmental conservation projects in developing countries, and have also asked her about environmental conservation initiatives at the front line of international development and how she sees the future of international aid systems.

Ms. Naoko Ishii

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1981 Graduate of the Faculty of Economics, University of Tokyo, and joined the Ministry of Finance
1984 Visiting fellow at the Center for International Affairs at Harvard University
1988 Director, Hirosaki Regional Tax Collection Office, Aomori Prefecture
1992 Economist, Policy Development and Review Department; International Monetary Fund
1996 Project Manager, Harvard Institute for International Development
2002 Director, Development Institute Division, International Bureau, Ministry of Finance
2006 Country Director for Sri Lanka, World Bank
2010 Deputy Vice Minister, Ministry of Finance
2012 CEO and Chairperson, Global Environment Facility (GEF)

Publications include: The Economics of Macroeconomic Policy Coordination (Seisaku Kyocho no Keizaigaku), Nihon Keizai Shimbun, 1990; Empirical Analysis on Modern Economic Growth: Institutions Critical to Sustainable Economic Growth (Choki Keizai Hatten no Jissho Bunseki - Seicho Mekanizumu wo Kino saseru Seido wa Nanika), Nihon Keizai Shimbun, 2003 Awards: 1990 Suntory Prize for The Economics of Macroeconomic Policy Coordination (Seisaku Kyocho no Keizaigaku), (Political Science and Economics Category); the 8th Okita Memorial Prize for International Development Research for Empirical Analysis on Modern Economic Growth: Institutions Critical to Sustainable Economic Growth (Choki Keizai Hatten no Jissho Bunseki - Seicho Mekanizumu wo Kino saseru Seido wa Nanika) in 2004; 2006 inaugural Enjoji Jiro Memorial Prize, jointly sponsored by Nihon Keizai Shimbun and the Japan Center for Economic Research

Motivations for involvement in the development of developing countries

Shirai: Ms. Ishii, you have had a very illustrious career. After joining the Ministry of Finance in 1981, you were involved in the implementation of development policies in various institutions, including the Center for International Affairs at Harvard University as a visiting fellow, the International Monetary Fund, and the World Bank. Please give us some more details of your career path.

Ishii:I did not have any particular ambitions to become involved in development economics or development policy after joining the Ministry of Finance. The Ministry of Finance has a personnel rotation system, and it is a difficult environment for mastering any single field. In that environment, I could not help but feel somewhat isolated, and at about that time, a desire to become professional in some particular area began to take root in my mind. I first became interested in development when I was working as a visiting fellow at Harvard University in my fourth year after joining the Ministry of Finance. At that time I met Professor Jeffrey D. Sachs (currently at Columbia University). After that, when I had life-changing decisions to make, I often consulted Professor Sachs. He suggested that I might find development economics an interesting field, and that the IMF or the World Bank might suit me. It was at that time that my interest in development economics gradually started to grow.

Shirai: Do you think your work at the Ministry of Finance laid the groundwork for such a career?

Ishii:I had very strong aspirations to work for both the IMF and the World Bank, and I believe the Ministry accepted my request with the understanding that more personnel would probably be required by international organizations in the future. I am very grateful for the magnanimity of the Ministry of Finance.

Shirai: Ms. Ishii, in your book Empirical Analysis on Modern Economic Growth: Institutions Critical to Sustainable Economic Growth (2003, Nihon Keizai Shimbun), you pointed out that in order for a developing country to grow its economy, in addition to funds, the establishment of social systems, development of infrastructure, and human resource development are essential. Likewise, you noted that these do not lead to sustainable development without vital systems and policies. Hitachi is also involved in infrastructure projects in developing countries and in many cases we learned important lessons our business efforts failed. Through experience, we have learned that knowing the local communities and building good relationships with them is very important.

Ishii:While I was working with development in Africa and Central Asia at the IMF, and East Asia at the World Bank, I constantly asked myself the question, “Why do some countries manage to develop, while some don’t ?” I thought perhaps the issue of systems was a significant factor determining the difference in development outcomes. So, I began my research. The hypothesis I presented was that, in order for a country to progress to the next stage of development, it must have achieved balanced development of six systems: know-how in technological innovation, physical infrastructure, human capital, private ownership, social cohesiveness, and governance. Unless countries have these in place, they will find great difficulty in progressing to the next stage of development. Conversely, investing in systems that are lagging in development is important to grow an economy. When I was trying to substantiate my hypothesis for this book, Professor Sachs became an important advisor. Based on this research, I published the book you mentioned in 2003; and in 2006, I received my doctorate based on it. I believe I have been blessed with opportunities and relationships.

Shirai: From the beginning of the year 2000, prices of resources increased, benefiting many resource-rich countries. In recent years, however, resource prices have declined, and I believe that the gap between countries is widening again. What is your view on this, Ms. Ishii?

Ishii:A significant disparity will emerge between those countries capable of wisely using wealth gained from the rise in resource prices and those countries that failed to do so due to political corruption and bribery. I firmly believe that what determines whether or not a country can progress to the next stage of development is not the availability of funds but whether various key systems are in place. In the past, this was certainly the case with Japan as well as Korea. Irrespective of the country, I believe economic growth is achievable with good leaders and systems. At the same time, to achieve sustainable growth, a country cannot ignore the global environment. To be honest, I am ashamed that I did not touch upon the global environment in this book. Both developed and developing countries exist equally within the constraints of the worsening global environment. The question now is how each country will incorporate their position on protecting the global environment into their systems and apply this to their own growth. I believe disparities between countries that achieve growth and those that do not will emerge as a result of these factors.

GEF’s mission

Shirai:Ms. Ishii, you are currently serving as the CEO andChairperson of the Global Environment Facility (GEF).I understand the GEF is an organization which supports initiatives in developing countries for the conservation and improvement of the global environment by providing grant aid for environmental projects in areas such as climate change, preservation of biodiversity, and the prevention of desertification. Could you please tell us more about the GEF?

Ishii:At the United Nations Conference on Environment and Development (Earth Summit) held in Rio de Janeiro, Brazil in 1992, leaders from all countries signed a series of conventions to protect the global environment: the Framework Convention on Climate Change, the Convention on Biological Diversity, and the Convention to Combat Desertification. The GEF was subsequently established as an organization to support the implementation of these conventions. In line with the objectives of the conventions,the GEF provides funds and know-how to enable those developing countries who agreed to protect the global environment to tackle environmental issues. After establishment of the three conventions, the Stockholm Convention and the Minamata Convention on Mercury were also added to the support list. The GEF also supports numerous projects and programs developing countries are conducting in other important areas such as forests and international waters.

Shirai:Could you please tell us about the GEF 2020 Strategy which the GEF has adopted?

Ishii:The “2020” in the GEF 2020 Strategy encapsulates two meanings. The first refers to the kind of organization the GEF aspires to be by around the year 2020. The other is the GEF’s aspiration to become an organization with 20-20 vision, enabling it to see far into the future. Unless we make changes, human activity will destroy the global environment, making sustainable development impossible. We have to consider what we must do to prevent the destruction of the global environment and to achieve sustainable growth. In the GEF 2020 Strategy, the GEF uses Planetary Boundaries as the basic framework. These are research outcomes of a group of scientists led by Dr. Johan Rockström, Executive Director of the Stockholm Resilience Center, which quantified in terms of volume the extent to which mankind can safely engage in activities and sustain development and prosperity in relation to vital earth systems such as climate, biological diversity, the nitrogen cycle, the water cycle, and soil. I believe this was the first study in the world that attempted to measure the correlation between the global environment and human activities. While there was some criticism of it when it was released in 2009, since the revised version came out in the spring of 2015, it has been widely accepted among knowledgeable persons responsible for policies for the conservation of the global environment. The basic message is that the ongoing burdens placed on the global environment by our economic society since the industrial revolution, particularly since the 1950s, have already exceeded the limit in areas such as climate change, the nitrogen cycle, and biological diversity. Until now, earth’s systems have tenaciously and robustly managed to recover from the continued impact of human economic activity. Nevertheless, if the limit at which the safe zone of environmental capacity can be maintained is exceeded, the earth will be unable to return to its former state, and we will plunge into a world where we are not certain of what will happen. A catastrophic environmental change which threatens the existence of mankind is possible. The message for maintaining the safe zone for earth systems overlaps to a great extent with the challenges the GEF is tackling. I believe the GEF’s mission is to achieve the aspiration of human beings to become more prosperous within this safe zone, irrespective of whether they are in developing countries or developed countries.

Shirai:As the world enters into a new era that addresses environmental concerns, what is your view about striking a balance between the environmental problems of developing countries and their economic growth?

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Ishii:I am frequently asked whether economic development is compatible with the environment. In some areas, however, the global environment itself is a premise for sustainable economic growth. Both China and Africa are both at the stage where environment and development cannot be considered separately. A few years ago, China developed the concept of Ecological Civilization. In short, it is a concept for reviewing the relationship between ecological systems and civilization. China too understands that it cannot maintain sustainable development based on the current economic and social system and that a significant adjustment is necessary in the future. Africa is at the other extreme; its forests have been indiscriminately harvested in search of resources to survive tomorrow. This is due to its poverty or, in some places, the excessive use of chemical fertilizers which have made soil infertile and have resulted in reduced agricultural productivity. As a result of the excessively harsh treatment of our ecological systems, people’s lives in the future are under threat. Unless countries break away from the status quo and protect natural capital, sustainable development in Africa will be realized. While they are at different stages of development, both China and Africa have reached the stage where the correlation between economic development and ecological systems needs to be reviewed. The GEF 2020 Strategy also began as a mechanism for providing support for sustainable growth, focusing on the relationship between human economic activity and the global environment.

Shirai:This year, 2015, the Sustainable Development Goals (SDGs*1) were adopted by the UN General Assembly, and the 21st session of the Conference of the Parties (COP21*2), i.e. the United Nations Framework Convention on Climate Change, was held. I believe there is still a significant gap between the positions of developed countries and developing countries, but has there been any change in this regard?

Ishii:This year, discussions on the international polices of the SDGs and COP21 have attracted attention. A strong awareness of the need for both developed and developing countries to work together was clearly evident with respect to recognizing the need for both to tackle development together under the SDGs, and with respect to the shared obligation of both to conserve the environment under COP21. While the GEF provides funds to developing countries, I believe the underlying issue for both developing countries and developed countries is global environmental conservation, which is the foundation for the development of an economic society. Currently, 183 countries are members of the GEF, and major donor countries include the G7 and scores of developed countries. It is very interesting to note the rapidly increasing capital contributions from semi-developed countries. In a capital increase decided in 2014, Mexico doubled its contribution, while China and India increased theirs by 30%. At a time when the capital contributions of developed countries are showing little growth due to the financial difficulties faced by those countries, efforts on the part of semi-developed countries, which are themselves past recipients, to increase their contributions as donors are becoming more widespread. This is indicative of a growing awareness that all are stakeholders in the global environment, and that responsibility for protecting it rests, not only with developed countries, but also with developing countries.

Shirai:In regard to the North-South conflict as well, where both developing and developed countries are at loggerheads, there is the argument that developing countries must be allowed to achieve economic development and that destruction of the environment was caused by developed countries in the first place. Am I correct in believing such a relationship of conflict is changing?

Ishii:You are correct. Take the negotiations for the Framework Convention on Climate Change, for example. The tone of the political dispute still remains strong. Although the establishment of the Green Climate Fund (GCF) was already decided in 2010 to support countermeasures for global warming by developing countries through financing by developed countries, the structure of the North-South dispute had not changed very much regarding the viewpoint that developing countries (the South) have the right to promote development, while simultaneously having the right to receive funds. This being because the worsening in climate change is the responsibility of developed countries (the North). On the other hand, once they leave the negotiation table, a number of countries overtly promote the view that unless everyone makes concerted efforts to protect the global environment, it will reach an irreparable state, and they warn that this is not the time to be engaging in a North- South conflict. The reason China is coming up with policies like the Ecological Civilization or the Green Industrial Revolution is that it too understands both China and the earth will reach an irrecoverable state if the country continues to follow existing approaches to economic development. I am certain that China understands the relationship of mutual dependence between the environment and economic development, with the understanding that it is for the sake of China but at the same time is beneficial to the world. The reason the North-South conflict has taken this structure until now is that it has been more advantageous in terms of negotiations, but perhaps in the future, new leaders will emerge and overcome the North-South problem. financial difficulties faced by those countries, efforts on the part of semi-developed countries, which are themselves past recipients, to increase their contributions as donors are becoming more widespread. This is indicative of a growing awareness that all are stakeholders in the global environment, and that responsibility for protecting it rests, not only with developed countries, but also with developing countries.

Shirai:In regard to the North-South conflict as well, where both developing and developed countries are at loggerheads, there is the argument that developing countries must be allowed to achieve economic development and that destruction of the environment was caused by developed countries in the first place. Am I correct in believing such a relationship of conflict is changing?

Ishii:You are correct. Take the negotiations for the Framework Convention on Climate Change, for example. The tone of the political dispute still remains strong. Although the establishment of the Green Climate Fund (GCF) was already decided in 2010 to support countermeasures for global warming by developing countries through financing by developed countries, the structure of the North-South dispute had not changed very much regarding the viewpoint that developing countries (the South) have the right to promote development, while simultaneously having the right to receive funds. This being because the worsening in climate change is the responsibility of developed countries (the North). On the other hand, once they leave the negotiation table, a number of countries overtly promote the view that unless everyone makes concerted efforts to protect the global environment, it will reach an irreparable state, and they warn that this is not the time to be engaging in a North- South conflict. The reason China is coming up with policies like the Ecological Civilization or the Green Industrial Revolution is that it too understands both China and the earth will reach an irrecoverable state if the country continues to follow existing approaches to economic development. I am certain that China understands the relationship of mutual dependence between the environment and economic development, with the understanding that it is for the sake of China but at the same time is beneficial to the world. The reason the North-South conflict has taken this structure until now is that it has been more advantageous in terms of negotiations, but perhaps in the future, new leaders will emerge and overcome the North-South problem.

Shirai:While there are still many problems in Africa, that continent has made significant changes compared to 10 years ago. As you mentioned, African countries have been unilateral recipients of aid until now, but they are making progress in terms of taking independent action. The GEF has been deploying various support activities for developing countries that do not have sufficient funds or technical know-how. Please tell us about your projects to date.

Ishii:In the area of climate change, a significant area of GEF support, we aim to reduce greenhouse gases (GHGs) through technology transfers. For example, we are asking developing countries to introduce concentrated solar power (CSP) to replace thermal power generation. This will incur costs, and one of our typical support projects is to offer funds for the additional installation costs. To date, we have introduced CSP in Morocco, Egypt, and Mexico. Aiming for efficient use of energy in countries as a whole, we are also providing financial assistance to make the display of the amount of energy used stricter, and we are preparing an information gathering system for this purpose. We are also devoting efforts to integrated projects. We are supporting activities to prevent desertification in Africa, where we have formed a group consisting of Sub-Saharan countries, and in Southeast Asia, where we have formed a cooperative organization consisting of the six countries (Indonesia, the Philippines, Malaysia, Papua New Guinea, Solomon Islands, and East Timor) surrounding the Coral Triangle, one of the world’s richest marine areas, in order to protect it from overfishing and pollution.

*1
SDGs: Abbreviation for Sustainable Development Goals. These are international development goals succeeding the Millennium Development Goals (MDGs) established in the year 2000. These goals target all countries, both developed and developing, and address the three aspects (economic, social, and environmental) of sustainable development in an integrated manner.
*2
COP21: Abbreviation for the 21st session of the Conference of the Parties. The aim is to realize a framework in which all countries including the United States and China can participate in order to reduce greenhouse gas emissions to achieve the international goal of limiting the rise in global temperature to 2 degrees Celsius above the pre-industrial revolution level.

Achieving results through new approaches

Shirai:In addition to existing initiatives, I believe the GEF is focusing on cooperation with a large number of organizations. Please tell us about the GEF’s plans for the future.

Ishii: Since its establishment in 1992, the GEF has been involved in a wide range of activities and has achieved numerous results. At present, however, deterioration of the environment is becoming increasingly serious. Nature, a general science journal, previously announced its assessment of the three conventions I mentioned earlier, which deal with climate change, biological diversity, and desertification. It assigned all three an “F” (fail). While this was not an outright assessment of the GEF, if environmental conservation receives an “F” on its report card, the GEF, which provides funds aimed at promoting environmental conservation, also implicitly receives an “F” on its report card. In the framework of the Planetary Boundaries I mentioned earlier, the limit has already been exceeded in the areas of three earth systems. Consequently, no matter how successful each project may have been individually, from the outset it was understood that it was a lost battle from the perspective of an overall assessment. Therefore, the GEF needed to change the way it did things until then, so we focused our attention on three new initiatives: an approach focusing on the driver, an integrated approach, and a multi-stakeholder approach. First is the “approach focusing on the driver.” Since the effectiveness of dealing with issues through follow up after they occur, as we did in the past, is limited, we intend to approach the fundamental cause (the driver) of the deterioration of the environment. Next is the “integrated approach”. This is to identify problems and underlying causes in an integrated and systematic manner. The issues of climate change, desertification, and biological diversity stem from the common problem of human activity placing too much pressure on ecological systems. In dealing with these problems, we tend to divide them into specialized areas such as the Convention on Climate Change, the Convention to Combat Desertification, or the Convention on Biological Diversity. Since the causes of environmental destruction have some common factors, we must also promote integrated initiatives. Finally, there is the “multi-stakeholder approach” for working in cooperation with a number of organizations. The aim is to engage in highly effective activities by widening the scope of stakeholders in relation to environmental conservation to include cooperation not only with government but also with private companies, NGOs, NPOs, civil society organizations (CSOs) including communities, and academia.

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Shirai:In specific terms, what kind of activities do these approaches involve?

Ishii: At present, if we look at a breakdown of GHG emissions by cause, deforestation is almost on a par with transportation. Therefore, simply putting a stop to deforestation would enable a substantial reduction in GHG emissions. The causes of deforestation, particularly for tropical rain forests, are largely associated with the production of global commodities (primary products) such as palm oil, acacia pulp, soybeans, and livestock. In addition to the increasing global population, the pursuit of luxury and plenty, such as greater beef consumption by the middle class, also contributes to deforestation. To curb this trend, we must focus our attention on the sustainability of the supply chain. It is necessary for agents in the supply chain from the production and processing to logistic companies handling these products to unite as a single entity to tackle this problem. We refer to this as the “supply chain approach.” Take palm oil, for example. Many people who engage in small-scale farming, which accounts for 50% of production, continue to engage in unlawful, indiscriminate harvesting. Therefore, simultaneously, it is necessary to have an approach that encompasses activities such as giving instructions in capacity building and know-how, or providing financial aid to aid the transition to sustainable production. In addition, the promotion of consumer activities such as boycotting illegally harvested palm oil is also important. In this regard, though the situation in the market in China and India is difficult, I believe a platform based on multi-stakeholders will prove worthwhile in addressing this problem. At present, efforts promoting such cooperation are currently underway.
One more area I would like to touch upon is our initiative in urban development. Approximately 70 to 80% of all economic activity takes place in cities, and cities emit 70% of all GHGs. Therefore, it is important for heads of governments and urban planners to construct cities with reduced environmental impact in the medium to long term. The GEF provides support for “sustainable urban programs” which facilitate such urban design. We are making efforts in this regard through a new approach which involves forming networks with urban organizations.

Shirai:I imagine that decisions made due to the SDGs and at COP21 this year will have a significant impact on the future of society and the global environment. Do you believe GEF’s initiatives will change in the future in light of the SDGs adopted?

Ishii: The SDGs are very important initiatives. The fact that both developed countries and developing countries are working together, and that the 17 SDGs are widely accepted throughout the world, can be regarded as a positive sign. The issues that the GEF focuses on, such as the oceans, forests, and urban development, areincorporated in the SDGs; and, if we can promote these throughout the world, it will be a step forward. I would like to say “Congratulations!” to the 193 member countries which are actually tackling the issues, rather than to the United Nations itself. However, the main challenge still lies ahead of us. The question is how can we make the transition from aspiration to actual execution? This, I believe, will be a major task in the future. The GEF holds trust funds for support of conservation of the global environment, and it is our task to rally action at the actual sites. The fund itself is a just drop in the ocean, but we are hoping that developing countries will take advantage of this drop by engaging in efficient and highly effective activities through cooperation in sustainable urban programs such as those I have mentioned, and with all kinds of organizations. For developing countries to participate in such activities, indirect support in areas such as capacity building will be important.

The role of China as a country that achieved rapid

Shirai:In the postwar era, support for developing countries was implemented through the frameworks of the World Bank and the IMF. China, on the other hand, despite various constraints, achieved miraculous growth since the 1980s, though this has slowed recently. What is your view of China’s economic development?

Ishii: I believe China developed in the way it was meant to. I believe the manner in which it developed is similar to that of Japan or Singapore. It can be described as heavy and large-scale development which expanded inputs such as labor and capital. I think China, above all, is feeling acutely that the approach to development which it has followed to date has reached its limits, and it is becoming desperate to find a solution for the future at the moment. This attempt to find a solution is nothing more than a manifestation of the concept of an “Ecological Civilization” which I spoke of earlier. China has been a member of the GEF since its establishment, but China’s expectations of the GEF from the outset lay not in funding but in receiving support for technological innovation and the provision of know-how. China’s various activities in environmental conservation have many interesting aspects, and it is an interesting country to engage in business with. China hopes to further promote environmental conservation activities and sustainable development in the future, and we share the same position. China has made a commitment to green finance and to promote a directional shift to sustainable economic activity in its financial system as a whole. As part of this commitment, China is also making earnest efforts to reform its financial institutions, such as the central bank, city banks, and development banks, and I believe that we can expect significant improvement. Moreover, China is using enormous funds to research know-how in technical innovation, which has reached a considerably high level.

Shirai:China is trying to establish international finance institutions which differ from the existing frameworks of the World Bank or IMF. Through the New Development Bank BRICS (NDB BRICS) and the Asian Infrastructure Investment Bank (AIIB), China is pressing ahead with its support of emerging countries in infrastructure development. How do you view such activities by China?

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Ishii: There are some who view the establishment of the AIIB, and NDB BRICS as a revolt against what is known as the Bretton Woods system. However, I do not believe the motivating force in their establishment is necessarily that simple. While the five BRICS countries are still in the process of developing and still have various problems to deal with, they have ample funds overall. However, even if they contribute to an organization like the World Bank, they will not necessarily receive sufficient returns in their own countries. Therefore, I do not think it is wrong for them to consider and desire the use of their own funds for their own specific purposes. In regard to the establishment of the NDB BRICS, I also heard that China received advice from economists who themselves had previously served as former chief economists at the World Bank, including Nicholas Stern of United Kingdom, and Joseph Stieglitz of the United States. Against a backdrop of ample foreign currency reserves, they themselves procure funds from the market, which they then leverage and apply to infrastructure development in whatever form they desire. This perhaps is an indication of the extent to which semi-developed countries, including BRICS, have grown in strength. Although I attended the opening ceremony of the NDB BRICS in July, I was unable to clearly determine the extent to which the countries can achieve sustainable infrastructure development. Only when there is sustainable infrastructure development will there be sustainable economic growth. In India, 70% of the cities will start taking on their own infrastructure development from now. Infrastructuredevelopment in cities has significant lock-in effects. Therefore, I hope urban development will be approached from a long-term perspective, with the understanding that, once built, infrastructure will last 30 to 40 years.

Shirai:Both the United States and China, countries which previously had a reputation for being rather backwardlooking in relation to environmental issues, have started to express more conviction.

Ishii: Yes, indeed. Although their respective considerations may be different, I believe that the fact that the two major powers were able to agree on the GHG reduction goals, sent a very positive message to the world.

Future image of international aid

Shirai:How do you view the aid policies of the current IMF and the World Bank in comparison with what they were in the 1990s, when you worked for the IMF? Also, how do you think they need to change in the future?

Ishii: Even from the perspective of the NDB BRICS and AIIB, they are changing from the international aid systems we have seen to date. Comparing the 1990s with the present, I would say that the flow of funds from developed countries to developing countries, and public and private have done an about-face. Of course, it goes without saying that the provision of financial aid is vital in the role of public financial institutions, but what is important in that regard is the extent to which system reforms can be implemented for the development of countries through financial aid. As the IMF’s contribution is a mere drop in a big ocean, the question is, how skillfully can the country that receives this drop of funds use it? For example, the way knowledge is applied in areas such as attracting private sector investment aimed at growth that is more compatible with the environment, or tackling system reforms. As the example of China demonstrates, knowledge, information and technology will be needed in public financial institutions in the future. If public financial institutions including the World Bank, IMF, and the GEF adhere to the ways of the past, developing countries will turn away from them. I feel that countries’ expectations of international institutions are greater than they were in the past. I spoke about the supply chain approach in the GEF’s activities. Private companies and CSOs are taking on leadership roles in place of governments and they are promoting new initiatives. I met Paul Polman, who is CEO of the global company Uniliever, many times in regard to GEF projects, and he is a very inspirational character. A powerful leader like him is taking on initiatives in global environmental conservation as his own personal mission. In urban development, people like Mr. Michael Bloomberg, the former mayor of New York City and currently United Nations Special Envoy for Cities and Climate Change, powerful mayors are becoming increasingly aware that they need to use their leadership more and more to play an active role in initiatives, rather than wait for the federal government to do something. In regard to the GEF’s sustainable urban programs that I spoke of earlier, I recently met with the mayor of Johannesburg, South Africa. His thinking is very innovative, and he has a vision and a wealth of ideas to make Johannesburg a leading world city. In addition to supporting people like him, I believe a framework of ideas on global environment conservation must address the changing times.

Shirai:Ms. Ishii, you are currently based in Washington D.C. where the GEF headquarters are located, and you fly to various places around the world. Please tell us your view of Japan’s aid policies, based on the perspective you have gained from your experience at actual sites benefiting from the development policies for developing countries.

Ishii: There is a noticeable swing toward a concept that goes beyond the notion of the North-South problem of developed versus developing countries which has existed thus far. Instead of the provision of aid, the focus is on sharing wisdom for sustainable economic development in a new era. The earth belongs to everyone and making it a better or worse place is the collective responsibility of its inhabitants. With this understanding, leaders aim to create a joint support platform, and within this framework provide funds to developing countries with insufficient funds. The question is, what kind of leadership can Japan assume within this framework?
I guess this will depend on how much Japan can get involved in this newly created multi-stakeholder platform. For instance, Europe and the United States are showing strong leadership in creating and nurturing the supply chain approach to protecting environment, but there must be also wisdom and technology that Japan is capable of providing. While the landscape is changing rapidly, it would be good to see Japan’s gradual participation in leadership.

Shirai:Ms. Ishii, you have produced many papers, both in English and Japanese, despite your demanding responsibilities at the Ministry of Finance and international organizations. Please tell us if you have any special tips for managing both work and writing, and for maintaining motivation.

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Ishii: Writing is an integral part of my work, and in that regard there is no differentiation between my public and private life. Put another way, I believe I have always done only what I like doing. People are willing to invest in the things they like, and are capable of working hard when they like what they do. If I can be blunt, I value investing in myself. In Japan, the relationship between the company and the individual is still often the keystone of a person’s life. In my case, however, I view what I do from the perspective of “my profession and myself” rather than “the company and myself.” Throughout my career, whether it was with the Ministry of Finance, the IMF, the World Bank, or the GEF at present, I have basically been involved in international development. And what has been required of me during this time has been to be faithful to my profession. I guess the idea for us as individuals is to look for and develop workplaces where we can contribute the most.

Shirai:As a final question, please describe the dream that you would like to pursue as a challenge in the future?

Ishii: Since joining the GEF, I have visited many development sites and spoken with a large number of researchers. These experiences served to affirm my view that the global environment is facing a crisis. It even makes me wonder how I have managed to live my life in such a carefree manner until now without focusing on this problem with greater care. Unless we take action within this decade, the global environment will be in an irrecoverable state 30 years from now. It would be easier for people to understand if the impact of today’s actions were manifest tomorrow. But it becomes politically difficult to deal with if consequences appear in the far future, or if the issue can be viewed as belonging to other countries. The question is, how can we develop significant leadership for the important issue of environmental conservation domestically and abroad? What we need is a groundswell of united voices from various sectors, including private companies, rather than from countries’ most powerful figures. Results of consumer studies, for example, show a change in awareness, particularly among young adults. It would be fantastic if voices the world over merged into a single massive surge and resulted in the creation of many more opportunities for thinking about the global environment and human development. I would like to see more Japanese representation among those voices and leadership in such a surge.

Shirai:Do you hope to continue your involvement in international development and the environment?

Ishii: International development and the environment exist as one within me. Sustainable development cannot be achieved without consideration of the global environment, and consideration of the global environment enables us to understand the kind of sustainable development that is needed. I think the fact that my own personal awareness in this regard hardly existed until I started working for the GEF was a problem. It is important for us to impress upon the people of the world that international development and the environment are two sides of the same coin. The establishment of the Sustainable Development Solutions Network (SDSN) is also an initiative aimed at achieving this end. I feel it is good for me as an individual to participate in the activities of various global networks, including those of research centers, universities, technical institutions, private companies, CSOs, and international organizations such as the Future Earth and The World in 2050. While initiating activities in Japan, I also want to engage in efforts to ensure not only our own future but that of the whole earth.

Shirai:Thank you very much for coming today despite your busy schedule during your visit to Japan to attend an international conference.

Editor's Postscript

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On this occasion we interviewed Ms. Ishii, CEO and Chairperson of the Global Environment Facility (GEF) about environmental conservation projects in developing countries which the GEF has been involved in. It is our understanding that the GEF places importance on cooperation with various organizations, such as private companies and NPOs, and, to achieve maximum results in every project, it adopts a multifaceted approach which includes capacity building, rather than simply providing financial aid to developing countries. Through Ms. Ishii’s use of expressions such as “investing in myself” and “my profession and myself,” we felt that her irrepressible aspirations are the driving force behind her success, which has her playing an important role on the world stage. We look forward to following her future achievements.