Report

Strengthening Public Procurement for Climate Action and Competitiveness

Reform options for the EU public procurement directive

This report explains why the current European Union (EU) public procurement directive falls short in enabling green public procurement (GPP) and highlights the missed opportunities this creates for climate and competitiveness. The report presents high-level recommendations and detailed reform options to simplify rules, use procurement more strategically, and make GPP a consistent, practical driver of the EU's green transition.

November 28, 2025

Policy Recommendations

  • Make green public procurement the default across the European Union through a comply-or-explain approach supported by clear targets that create predictable demand for low-carbon and circular products.

  • Tie European preference rules to environmental performance so that any "Buy European" measures meaningfully support industrial competitiveness, climate goals, and circularity.

  • Simplify and harmonize procurement rules by clarifying legal requirements, improving digital tools, and aligning GPP obligations across EU sectoral legislation.

  • Strengthen monitoring and professionalization by improving data systems, tracking environmental outcomes, and investing in skills and capacity for contracting authorities.

Public procurement is a powerful yet underused lever for the EU's climate, circularity, and competitiveness goals. Although public authorities in the European Union spend nearly EUR 2 trillion each year, the current framework keeps GPP voluntary. Implementation remains uneven, rules are fragmented, and buyers face legal uncertainty and limited guidance. As a result, major opportunities to steer markets and cut emissions remain untapped. The missed opportunities are clear: few tenders include environmental criteria, most contracts are still awarded on lowest price, and legal uncertainty discourages ambitious GPP. Yet where sustainability requirements are clear and predictable, countries see rapid uptake, innovation, and emissions reductions. 

As the European Commission prepares to revise the procurement directives, this report sets out a practical roadmap for strengthening GPP. It identifies the structural challenges of GPP and outlines five high-level recommendations supported by detailed reform options. These include making GPP the default through a comply-or-explain approach, tying European preference rules to environmental performance, simplifying and harmonizing requirements, strengthening monitoring and data systems, and investing in professionalization. 

Together, these reforms would simplify procedures, improve accountability, build the skills and capacity of contracting authorities, and better align public spending with the EU's climate, circularity, and competitiveness objectives. They offer a coherent package for turning procurement from a missed opportunity into a strategic lever for Europe’s green transition.

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Report

Coal Transition Impacts and the Approach to Inclusive Just Transition Policies in Indonesia

This publication examines the economic, social, and gendered impacts of potential coal mine closures across key coal-producing provinces in Indonesia. It explores the best pathways to pursue a just transition, identifying potential sectors, and proposing solutions for including vulnerable communities, such as women and informal workers.

December 1, 2025

Policy Recommendations

  • Combine quantitative economic models with qualitative, community-based methods, such as ethnography, participatory mapping, and focus groups.

  • Prioritize sectoral transitions and empower local governments. Economic diversification strategies should be put in place well in advance of coal mine closure to prevent economic shocks and associated social disruptions.

  • Tailor social protection to minimize income loss during coal mine closures.

  • Assign gender equality and social inclusion focal points and mandate inter-ministerial coordination to help embed inclusion into governance.

Indonesia’s shift away from coal offers a powerful opportunity to advance its climate commitments under the Paris Agreement while building more resilient, diverse, and inclusive local economies. This report assesses how a well-managed transition can unlock new engines of growth and quality jobs across five major coal-producing provinces: East Kalimantan, South Kalimantan, South Sumatra, Central Kalimantan, and Jambi.

Combining quantitative modelling with qualitative field research, the study examines how planned coal phase-outs could reshape economic output, employment, and livelihoods—especially for informal workers, women, and youth. It evaluates three policy scenarios that range from business-as-usual contraction to proactive, investment-led strategies that channel resources into high-multiplier industries and emerging green economy sectors.

The findings highlight that, while provinces such as East Kalimantan and South Sumatra face higher exposure to coal decline, targeted investment in food and beverage manufacturing, green industries, and other diversified sectors can drive robust job creation and economic renewal. More diversified regions, like Jambi, are already well-positioned to capture these opportunities. Insights from East Kutai show that communities are eager for alternatives and that inclusive planning, stronger social protection, and workforce reskilling can ensure people benefit directly from the transition.

The report concludes with strategic recommendations for national and local governments to seize this opportunity: strengthen institutional coordination, mainstream gender equality and social inclusion, expand safety nets, and develop locally tailored transition roadmaps. It also underscores the importance of combining macroeconomic analysis with community-level insights to design a just, job-creating, and future-ready energy transition for Indonesia.


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Report

Setting International Technical Standards to Shape Digital Trade Policy

Approaches, challenges, and opportunities for developing countries

As digital trade expands, digital technical standards are essential for ensuring interoperability, scalability, security, and seamless integration among actors across global markets.

November 20, 2025

Key Messages

  • Interoperability, scalability, and security in digital trade rely on internationally recognized technical standards. For developing countries, meaningful engagement in international standard-setting processes plays an increasingly important strategic role in securing digital market access.

  • Despite the strategic importance of digital standards, developing country stakeholders face barriers that limit their participation in international standard-setting. The "standardization gap" risks leaving these countries as passive "standard-takers" rather than active contributors.

  • Policy-makers can bridge the standardization gap by monitoring international forums, prioritizing open development processes, seeking targeted support to participate, and collaborating across countries and organizations.

This policy primer provides a comprehensive overview of digital technical standards: what they are, how they are developed, and why they are vital for digital trade policy. It explores international governance frameworks, standard-setting approaches, and the influence of trade agreements, while highlighting strategies major economies use to lead in defining these standards. The primer also addresses the unique challenges developing countries face in engaging with these processes and offers practical recommendations for policy-makers and trade officials. 

This report is part of a policy primer series, funded by the Swedish International Development Cooperation Agency (SIDA), aimed at deepening understanding of the key policy and regulatory foundations that shape today's digital economy.

This is the third report of the Building Blocks of Digital Trade Regulation series. You can continue exploring the series here:

Report details

Topic
Trade
Project
Digital Trade
Impact area
Sustainable Economies
International Governance
Publisher
IISD
Copyright
IISD, 2025
Report

A Sustainable Asset Valuation Assessment of Nature-Based Solutions in the Dechatu River Catchment in Dire Dawa, Ethiopia

Dire Dawa, Ethiopia, faces growing pressures from flash floods, soil erosion, and water scarcity. The SUNCASA initiative is restoring the Dechatu River catchment through afforestation, agroforestry, riparian restoration, and urban tree planting. This Sustainable Asset Valuation (SAVi) assessment evaluates the environmental, social, and economic performance of these nature-based solutions (NbS) and shows how they reduce flood risks, improve health, create livelihoods, and build resilience.

November 20, 2025

Key Findings

  • Restoring land in the Dechatu River catchment can significantly reduce flood damage, improve water quality, and lower heat-related health impacts. The greatest benefits come from avoided flood damage to infrastructure (USD 1.35 million) and savings in climate-related health expenses (USD 930,000).

  • NbS in Dire Dawa deliver strong economic and environmental value. Over 25 years, every USD 1 invested in NbS generates USD 1.36 in benefits. The interventions will also store up to 175,000 tonnes of carbon dioxide, demonstrating their contribution to climate mitigation and local adaptation.

  • Restoration creates jobs and strengthens resilience. Afforestation, agroforestry, and urban greening not only protect ecosystems but also create nearly 7,000 jobs and improve livelihoods. These activities enhance the city's ability to adapt to floods, droughts, and heat.

Dire Dawa lies in one of Ethiopia's most flood-prone catchments. Seasonal flash floods from the Dechatu River cause recurring damage to homes, infrastructure, and livelihoods, while deforestation, land degradation, and rapid urban growth have reduced the land's ability to absorb water. At the same time, groundwater depletion and pollution are intensifying water scarcity and health risks. 

To address these challenges, the SUNCASA (Scaling Urban Nature-based Solutions for Climate Adaptation in Sub-Saharan Africa) initiative, implemented by the International Institute for Sustainable Development, the World Resources Institute, and local partners with support from Global Affairs Canada, promotes gender-responsive NbS interventions in Dire Dawa. These include afforestation and agroforestry to restore degraded land, riparian buffer restoration to reduce runoff and erosion, and urban tree planting to mitigate flooding and heat. 

The Nature-Based Infrastructure Global Resource Centre conducted a SAVi assessment to evaluate the economic, environmental, and social performance of these interventions compared to a business-as-usual scenario. 

The results show that investing in nature provides strong and measurable returns. Every USD 1 invested in NbS generates USD 1.36 in benefits. The greatest impacts come from avoided flood damage to infrastructure, reduced health costs from water pollution and heat, and increased carbon sequestration—storing up to 175,000 tonnes of carbon dioxide and creating nearly 7,000 jobs by 2050. 

These findings show that NbS can restore degraded ecosystems, protect communities from climate impacts, and support sustainable livelihoods. Integrating these measures into local planning and investment strategies will help Dire Dawa strengthen climate resilience and promote inclusive development.

Report

Making It Happen

How the G20 can end fossil fuel subsidies in practice

This report explains how G20 members can finally deliver on their pledge to phase out inefficient fossil fuel subsidies. It proposes a three-tier categorization of subsidies—quick phase-out, phase-out with a robust strategy, and time-limited exemptions—and applies it to five G20 countries to show how national phase-out plans can work in practice.

November 18, 2025

Key Messages

  • G20 governments should adopt national fossil fuel subsidy phase-out plans to move from high-level pledges to transparent, time-bound reform.

  • Analyzing fossil fuel subsidies from Brazil, Germany, Italy, Mexico, and South Africa shows that many subsidies can be removed quickly, while most fiscal value lies in measures requiring well-planned, medium-term reforms.

As G20 countries seek productive investment in infrastructure, energy, education, health, and climate resilience both individually and as a group, one immediate opportunity remains underutilized yet actionable—fossil fuel subsidy reform. 

In 2023, G20 countries spent USD 794 billion on fossil fuel subsidies. These subsidies undermine climate goals, strain public budgets, distort markets, and weaken energy security by locking countries into volatile fossil fuel supply chains.

While emergency measures during the energy crisis explain the fossil fuel subsidy spike in recent years, the failure to implement the G20's commitment "to phase out inefficient fossil fuel subsidies," dating back to 2009, underscores that the G20 has fallen short of finding a constructive way to fossil fuel subsidy reform beyond blanket statements. 

This is exactly what the policy report acts on: our proposed framework categorizes fossil fuel subsidies in three tiers—quick phase-out, phase-out with a robust strategy, and time-limited exemptions—and offers a practical roadmap to deliver national reforms.

Analyzing fossil fuel subsidies from Brazil, Germany, Italy, Mexico, and South Africa shows that many subsidies can be removed quickly, while most fiscal value lies in measures requiring well-planned, medium-term reforms.

G20 economies can pursue these efforts individually and do not need to wait for every member to move at the same pace. Three G20 countries—Canada, France, and the United Kingdom—have already joined the Coalition on Phasing Out Fossil Fuel Incentives including Subsidies (COFFIS) to continue combining collective and national efforts and make reforming fossil fuel subsidies both actionable and achievable.

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Ethnographic Research as a Tool for More Inclusive Just Transition Policies

Lessons from Mpumalanga, South Africa

This report examines how ethnographic research can make South Africa's just transition more inclusive and participatory. Focusing on Mpumalanga's coal communities, the study highlights how ethnography—through long-term engagement and co-production—helps bridge trust gaps, capture lived experiences, and amplify marginalized voices often overlooked in top-down policy design.

November 14, 2025

Policy Recommendations

  • This report recommends institutionalizing co-production, allocating dedicated transition engagement funds, and strengthening replicable capacity.

South Africa's energy transition presents opportunities for low-carbon growth but also deep social risks in coal-dependent provinces like Mpumalanga. This report investigates how ethnographic methods can strengthen procedural justice and local participation in just transition policy-making. 

Using immersive fieldwork and a pilot co-production study in communities, such as Komati, Phola, and Emalahleni, the research identifies information gaps, exclusion of women and informal workers, and declining community services following coal plant closures. It demonstrates that ethnographic approaches—rooted in trust, lived experience, and long-term presence—yield deeper insights than one-off consultations. 

The report recommends embedding ethnography and co-production into just transition frameworks, establishing dedicated funding for inclusive engagement, and training government officials and community leaders in participatory research methods. Doing so can help ensure that vulnerable groups, particularly women and youth, are not left behind as South Africa advances its just energy transition.


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Participating experts

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Topic
Climate Change Mitigation
Energy
Gender Equality
Just Transition
Impact area
Climate
Social Equity
Publisher
IISD
Copyright
IISD, 2025
Report

Non-Metallic Mining

Building the case for tailored tax and royalty regimes

This report analyzes the economics of non-metallic mining and the challenges of designing taxes and royalties for the industry. The report makes recommendations on how governments can tax the industry, focusing on royalty administration and addressing transfer pricing risks and questions around tax incentives and export taxes. It provides data for individual countries on value chains for specific non-metallic minerals.

November 13, 2025

Key Messages

  • The right tax and royalty policies for non-metallic minerals may depend heavily on the economics of each mineral.

  • Revenue maximization is not always the priority in fiscal policies for non-metallic minerals.

  • Unit-based royalties can be a good option for some non-metallic minerals. These simple royalties may be appropriate for keeping the cost of tax administration at a minimum, where the potential of these minerals to provide government revenue is limited.

  • When using fiscal policies to attract investment or spur development, governments should apply the principles of effective industrial policy. They should also use tax incentives with caution, given their poor track record in promoting investment.

Non-metallic materials—that is, minerals that are neither metals nor fuels—are present in every country and are essential for people’s daily lives. We estimate that over USD 217 billion of such minerals are produced annually in 66 countries around the world; the global total is likely to be much higher. 

In this context, how can governments design tax and royalty policies for non-metallic mining that achieve the right balance of mobilizing tax revenues from non-metallic mining; facilitating production, which may boost competitiveness and create jobs in downstream industries; and other objectives? This is the focus of the present study. Much of the existing analysis of mining tax and royalties is focused on higher-value, metallic minerals and may not be appropriate for non-metallic minerals. 

This report, therefore, proposes a framework for governments to design tax and royalty policies for non-metallic minerals. It focuses on the issues of royalties, export taxes, corporate income tax (especially transfer pricing challenges), tax incentives, artisanal mining taxation, and environmental taxation.

Participating experts

Report

Tax Considerations for Critical Minerals Value Addition

With global demand for critical minerals increasing amid the energy and digital transitions, this report explores how resource-rich countries can capture greater domestic value from their minerals. It examines how fiscal strategies, supported by legal, regulatory, and infrastructure enablers, can help foster local processing, refining, and manufacturing.

October 29, 2025

Key Messages

  • Rising demand for critical minerals has revived interest of mineral-rich countries in processing activities that capture value further down the mining value chain. Countries have used various fiscal and non-fiscal measures to encourage value addition, with mixed results.

  • Primary enablers essential for successful mineral value addition include stable legal, regulatory, and institutional frameworks, reliable infrastructure, and a domestic market capable of absorbing processed products.

  • Secondary enablers include production- and cost-based fiscal incentives, complementing primary conditions. Royalty adjustments and cost-based measures can impact upfront capital costs and support downstream processing, but they need to be carefully calibrated.

This report examines the opportunities and challenges for resource-rich developing countries to develop downstream processing and manufacturing in the mining value chain. Focusing on a selection of critical minerals vital for the energy transition, it examines two central questions:

  • What specific fiscal and non-fiscal conditions enable countries to optimize the balance between revenues from producing the mineral and benefits from processing and refining the mineral further down the value chain in-country?
  • What tax and other related measures have countries adopted to increase in-country value across the mining value chain? 

The analysis considers factors that have helped or hindered previous attempts to increase domestic value lock-in in resource-rich countries and emphasizes practical approaches to designing fiscal policies that support sustainable value addition.

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Topic
Mining
Taxation
Impact area
Sustainable Economies
Publisher
IISD
Copyright
IISD, 2025
Report

Sustainable Asset Valuation of Mangroves and Wetlands for Coastal Resilience in Mozambique

An economic valuation of ecosystem-based adaptation in three estuaries

Mozambique's coastline is highly vulnerable to cyclones, floods, and saltwater intrusion, while the loss of mangroves and wetlands has weakened natural protection for people and ecosystems. This Sustainable Asset Valuation (SAVi) assessment shows that investing in nature-based infrastructure (NBI) through the restoration and conservation of mangroves and wetlands can deliver up to USD 537.5 million in net benefits, strengthen biodiversity, and build long-term resilience to climate change.

October 21, 2025

Key Findings

  • Restoring ecosystems reduces climate losses. Mangrove and wetland restoration can cut flood and pollution damages by more than USD 120 million, shielding coastal communities and infrastructure from cyclones and saltwater intrusion.

  • NBI provides substantial economic value. Every USD 1 invested in restoring Mozambique's mangroves and wetlands can return up to almost USD 14 in benefits, protecting people and ecosystems while strengthening the national economy.

  • Restoring ecosystems makes coastal communities safer and ecosystems stronger. Healthy mangroves and wetlands slow storm surges, protect farmland from saltwater, provide nursery grounds for fish, and restore habitats for wildlife—helping people and nature recover faster after extreme weather.

Mozambique ranks among the world's most climate-vulnerable countries. Cyclones, floods, and saltwater intrusion regularly devastate coastal communities, damaging homes, farmland, and infrastructure. The loss of mangroves and wetlands has further eroded natural protection, leaving millions of people exposed to climate and environmental risks. 

To address these challenges, the Government of Mozambique, supported by the United Nations Environment Programme, is developing a proposal to the Green Climate Fund that promotes ecosystem-based adaptation in three estuaries: Bons Sinais, Zambezi, and Limpopo. The plan combines the restoration of 7,500 hectares of wetlands, restoration of 3,800 hectares of mangroves, and conservation of 30,000 hectares of coastal ecosystems. These measures would directly benefit around 211,000 people and indirectly support more than 1 million people by improving water quality, sustaining fisheries, and reducing disaster risks. 

The NBI Global Resource Centre conducted a SAVi assessment to test the economic, environmental, and social performance of these measures compared to a business-as-usual scenario. The assessment considered several climate and carbon price scenarios to estimate how ecosystem restoration could lower flood and pollution costs, enhance fisheries, and capture carbon. 

The results show that restoring and conserving mangroves and wetlands is a high-return investment. For an estimated investment of USD 41.7 million, the interventions could generate up to USD 537.5 million in benefits—around USD 14 in value for every dollar spent. The Limpopo estuary delivers the highest returns because of its larger exposed population, while Bons Sinais and Zambezi also provide strong resilience and ecosystem gains. 

Beyond the economic results, the interventions would help re-establish vital habitats for fish and wildlife, prevent soil and water degradation, and improve the capacity of communities to recover after storms. These findings demonstrate that NBI is one of Mozambique's most cost-effective strategies for safeguarding people, strengthening biodiversity, and advancing national climate goals.

Report

Strategic Minerals for Africa's Industry

Insights and pathways for the present and future

Africa's mineral wealth can drive industrial growth, yet value addition remains limited and geoscience data gaps persist. This series profiles several strategic minerals, covering demand, recycling, Africa's mining and refining share, trade risks, environmental, social, and governance (ESG) issues, as well as pathways for equitable resource-based industrialization.

October 17, 2025

Key Messages

  • Africa's mineral endowment is strong, but value capture is weak: extraction dominates while refining, fabrication, and manufacturing lag. Equitable resource-based industrialization requires closing gaps in power, infrastructure, skills, technology, and finance.

  • Regional integration and smarter policy and finance are decisive: African Continental Free Trade Area–driven hubs, shared infrastructure, use of blended finance and strategic corridors, and harmonized standards can lift countries up the value chain together.

  • Strong ESG performance, artisanal and small-scale mining formalization, and traceability are becoming market entry tickets. Adoption of renewables in energy-intensive processing is key in increasing sustainability competitiveness and enabling African producers to access premium, low-carbon markets.

  • The emerging, voluntary G20 Critical Minerals Framework advances diversified, responsible supply chains and beneficiation at source, creating space for African priorities in the final texts of the framework and in partnerships to come between African producers and major importing countries.

Africa's mineral wealth can power industrial growth, yet much potential remains untapped as extraction dominates and value addition is limited. These publications—jointly developed by the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development and the African Development Bank—present insights on nickel, copper, cobalt, lithium, bauxite, phosphate, platinum group elements, iron ore, rare earth elements, manganese, graphite, and vanadium. 

Each factsheet profiles properties, global recycling, demand outlooks, and Africa's share of mining, refining, and exploration. They also map supply chains and trade, assess market risks and leverage points, and flag social and environmental challenges. The analysis situates these minerals within equitable resource-based industrialization aligned with the Africa Mining Vision, noting constraints from underinvestment in geoscience and structural factors across energy, skills, technology, infrastructure, and finance. 

Three trends are currently reshaping options for resource-rich countries: (a) security of supply for minerals essential for low-emissions energy systems, (b) clean energy cost parity, and (c) a shift toward more equitable resource partnerships.

Report details

Topic
Climate Change Mitigation
Mining
Project
The Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development (IGF)
Impact area
Climate
Sustainable Economies
Publisher
African Development Bank
Copyright
African Development Bank, 2025