Division for Africa, Least Developed Countries and
Special Programmes ( ALDC )
UNCTAD
The role of energy in boosting
productive capacities, commodity
diversification and fostering
structural transformation
in LLDCs
Mussie Delelegn
Chief, Landlocked Developing Countries' Section
Division for Africa, Least Developed Countries and
Special Programmes, UNCTAD
24-25 October 2016, Vienna, Austria
Structure of the presentation
I.
LLDCs and Energy: some basic facts
II.
Energy , PCs and structural economic
transformation in LLDCs
III.
Key challenges and opportunities
IV. Policy conclusions and recommendations
I.LLDCs
and
Energy:
some
basic
facts
Access to modern, affordable and sustainable energy is
key to realize economic, social and environmental
objectives, particularly:
 Achieve accelerated economic growth and
development;
 Expand employment opportunities;
 Enhance the provision of social services; and
 Reduce poverty levels and improve an overall
wellbeing of peoples and societies
 Without energy the realization of Sustainable
Development Agenda will be unthinkable.
LLDCs and Energy: Some basic facts
(Continued)
• 16 out of the 32 LLDCs are energy
importers;
• 8 are exporters of energy (in varying
degrees);
• 8 are both importers and exporters of
energy;
• More than 300 million people ( two thirds
of their total population) rely on
traditional use of biomass for cooking
(IAEA)
Country specific policies are needed
Energy, PCs and structural transformation
in LLDCs
 High energy cost and unreliability of
electricity provision are endemic in
LLDCs;
 In some LLDCs #days of power outage
is excessive (in some cases 140 days a
year);
 This
made
diversification
and
transformation agenda a challenge;
 Undermined export competitiveness;
and
 Entrenched commodity dependency
of these countries
LLDCs & commodity dependency
(2013-2015)
KGZ (2)
TCD (3)100%
AZE (3)
90%
TKM (3)
BWA (3)
MLI (2)
BFA (3)
NER (2)
ZMB (3)
80%
70%
60%
50%
40%
30%
20%
10%
0%
NPL (0)
MDA (2)
MKD (0)
UGA (2)
SWZ (2)
ARM (2)
AFG (3)
UZB (3)
KAZ (2)
ZWE (3)
TJK (3)
LAO (3)
CAF (3)
BTN (1)
LSO (1)
RWA (3)
MNG (3)
BDI (3)
PRY (3)
ETH (3)
MWI (3)
BOL (3)
Share of Commodities in total exports of
LLDCs (1993-2014)
45%
40%
35%
30%
25%
20%
LLDCs
Transit countries
Other developing countries
15%
10%
5%
0%
Export Concentration Index (ECI) Vs Energy
Development Index (EDI): 2013
1
0.9
Export concentration
0.8
0.7
0.6
0.5
0.4
0.3
0.2
0.1
0
0
0.1
0.2
LLDCs
0.3
Transit countries
0.4
0.5
0.6
Energy Development Index
Other developing countries
0.7
0.8
OPEC members
0.9
1
Productive Capacity Index Vs Energy
Development Index (2013)
60
Productive capacities index
50
40
30
20
10
0
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
Energy Development Index
LLDCs
Transit
Other developing
OPEC members
0.8
0.9
1
Productive Capacity Index (Ranking): selected
LLDCs (2000-2015)
Structural transformation: Selected LLDCs and ADCs:
( 2000 - 2015 Ranking)
IV. Key challenges and opportunities
• There is weak linkage between the energy sector and
productive sectors;
• There is slow or no structural economic transformation
(i.e. the process of shifting resources and policies):
To
FROM
New sectors
- traditional sectors
- traditional activities
- low-productivity
New activities
Higher productivity
Higher technology
- low-technology
Has not occurred in LLDCs: Neither
within sectors/ nor across sectors
V. Policy conclusions and recommendations
Concluding remarks:
• The crucial role of energy in development is
undeniable;
• In LLDCs (including energy producing and exporting
ones) fostering structural transformation poses
exceptional challenges;
 Synergies and complementarities between energy
policies and those aimed at boosting productive
capacities, commodity diversification and structural
economic transformation are critical;
Recommendations
To leverage energy for development, UNCTAD
advocates four pronged policies aimed at:
1. Increasing energy for all (access and
affordability);
2. Promoting efficiency in national energy use or
consumption (including minimizing production,
transmission and consumption losses);
3. Facilitating the gradually phase-in of renewable
energy technologies (RET); and
4. Scaling up of international support to LLDCs to
finance and transfer RET