the role of green economy in sustainable development

This expert paper is reproduced by the UNCTAD secretariat in the form and language in which it has been received. The views expressed are those of the author and do not necessarily reflect the view of the United Nations.

Ad Hoc Expert Meeting on

The Green Economy: Trade and Sustainable

Development Implications

7–8 October 2010

The role of green economy in sustainable

development Presentation by

Mr. Steven Stone

UNEP

Chief of Economics and Trade Branch United Nations Environment Programme - UNEP

Steven Stone , ChiefUNEP – Economics and Trade Branch

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The role of green economy in sustainable development

Ad Hoc Expert Meeting on The Green Economy: Trade and Sustainable Development Implications

7 October 2010

UNEP – GREEN ECONOMY INITIATIVE UNEP – GREEN ECONOMY INITIATIVE

1. Green Economy Initiative Origins and Background

UNEP – GREEN ECONOMY INITIATIVE

Global crises provide an

Opportunity to reconsiderTraditional growth models

1. GEI Conceptual Issues

Shifting to Green Economy


Global momentum for transition to a green economy

‐G20 reaffirmed commitment to “move toward greener, more sustainable growth” (Sept 2009)‐UN CSD 2012 (Rio+20): “green economy in the context of sustainable development and poverty eradication”

Food Crisis

Financial Crisis

Fuel Crisis

“Advising clients on Greening their Economies, by working with extensive partnerships of institutions and experts and using a range of research products infused with thought leadership”

GEI’s Mission

UNEP – GREEN ECONOMY INITIATIVE UNEP – GREEN ECONOMY INITIATIVE UNEP – GREEN ECONOMY INITIATIVE UNEP – GREEN ECONOMY INITIATIVE

Source: United Nations Human Development Index

Meets minimum criteria for sustainability

Meeting the dual goals of sustainability – High human development and low ecological impact

Source: WWF Living Planet Report 2006

Green Economy: The Need for Change

What is good about the GEI?

3. GEI AnalysisUNEP – GREEN ECONOMY INITIATIVE

“A Green Economy can be defined as one that results in improved human well‐being and social equity, while significantly

reducing environmental risks and ecological scarcities.”

Green Economy Working Definition

2. Green EconomyData Trends



Green Economy and Climate Change

Scenarios for GHG emissions from 2000 to 2100 (assuming no additional climate policies are brought into effect and estimates

of corresponding surface temperatures)

Green Economy & Climate Change


• In 2008, investments in renewable energy generation ($140 billion) surpassed investments in fossil fuel power generation ($110 billion)

• Projected investments in renewables could generate 20 million jobs

• REDD‐plus ‐ investments in reducing emissions from deforestation, forest degradation, and sustainable management of forests

• Business‐as‐usual risks increasing greenhouse gas emissions by 130% by 2050 (IEA) and raising average global temperatures by 6˚C (IPCC)

• Emissions linked to deforestation and forest degradation account for nearly 20% of global greenhouse gas emissions

Opportunities

Challenges

Green Economy and Resource Efficiency


Source: Living Planet Report 2008

Lost Capital

Source: FAO (2001; 2006)

• Earth has lost 40% of forestsover the 300 years.

• Since 1990, the world has lost roughly half of its wetlands, which slow floodwaters, protect uplands from erosion and improve water quality.

• 35% of mangroves have disappeared thanks to the encroachment of aquaculture

• Some 30% of coral reefs, essential for biodiversity, have been damaged through fishing, pollution or disease.

Source: Moser et al. (1996)

Source: Wilkinson (2004)

Source: Millennium Ecosystem Assessment (2005a)


• Investment ‐ increases net welfare gains from economic activities by “doing more and better with less”

• Global market for environmental products and services is projected to double from $1.37 trillion per year to $2.74 trillion by 2020

• Increasing demand ‐markets for organic food and beverages expanding on average 10‐20% per annum)

• Economic activity currently consumes more biomass than the Earth produces on a sustainable basis (i.e. the ecological footprint exceeds our planet’s resources)

Opportunities

Challenges

Green Economy and Resource Efficiency Incentives for Eco‐Innovation


Source: OECD (2010), The Invention and Transfer of Environmental Technologies

Incentive for eco‐innovation : CLEAR POLICY SIGNAL!

3. Green Economy Report Initial Findings


Green Economy Report


Key Messages from Chapters(being reviewed & revised)


ModelingEnabling Conditions

AgricultureBuildingCitiesEnergyFinanceFisheriesForest

ManufacturingTourismTransportWasteWater


• Selecting and driving transformation in key sectors ‐ critical or highly material for greening the global economy

Green Economy: Approach and Focus


• On enabling conditions (finance, subsidies, taxes, regulations, and related reforms that achieve GE objective)

FOCUSAPPROACH

taxes, regulations

subsidies

finance


• Green farming practices have increased yields, especially on small farms, between 79 and 180 percent.

• 10 percent increase in farm yields ‐> 7 percent reduction in poverty in Africa, more than 5 percent in Asia

• Approximately 2.6 billion people rely on agricultural production systems for their livelihood. (FAO 2009)

• 525 million small farms world wide, 404 million less than two hectares of land (Nagayets 2005), Small farms cultivate 60 percent of arable land (Herren et al. 2010)

An increase in overall GDP coming from agricultural labor productivity is on average 2.5 times more effective in raising the incomes of the poorest quintile in developing countries than an equivalent

increase in GDP coming from non‐agricultural labor productivity.

Agriculture


Fisheries


Source: Froese and Pauly (2004)

Business as usual is not an option: State of fish stocks

Reversingharmfulsubsidies

Investments

Strengthening political consensus

Fiscal policies

Type of subsidies

Impact Example Amount(US dollars in 2003)

Good Enhance the conservation of fish stocks over time

Funding fisheries management/ Using government spending to operate marine protected areas

$ 7.9 bn

Bad Lead to overcapacity and excessive catches

Fuel subsidies $ 16.2 bn

Ugly Can either conserve a fish‐stock or deplete it further

Buyback (or decommissioning) to fishing vessel to reduce a fleet size

$ 3 bn

Types of subsidies – leave $ 8 bio ‘good’ subsidies: MPA’s, fleet retirals, skills training, livelihood devpt

Source: Sumeila et al (2006)

Example: Fisheries sector

UNEP – Green Economy Initiative

Fisheries

Fisheries


Source: Fogarty & Botsford, (2007) , Oceanography 20 (3); pp 112‐123

73% of the US haddock catch are taken within 5 km of a fishery closed area, off the New England Coast.

Distribution of fishing effort around Georges Bank closed areas

Water


Aggregated global gap between existing accessible, reliable supply and 2030 13 water withdraws, assuming no efficiency gains

Billion m³, 154 basin/ regions

• Increased availability of finance for governments and businesses in key sectors [includes subsidies and tax instruments]

Financial Institutional

• Laws and institutions that encourage long‐term and efficient management and use of resources

• Laws and norms that encourage the transfer of technologies

• Improved administrative and technical capacity in government and other organizations

• Improved transparency and accountability

• Effective enforcement of laws

Economic Infrastructure Information‐based

• Increased funding for key sectors

• Policy support for key sectors that is clear, predictable and stable

• Prices that reflect true cost of goods and services

• Existence of key infrastructure [for those sectors that need it in order to attract further investment]

• Increased data and analysis about ecological conditions

• Increased awareness about sustainability challenges

• Increased information about life‐cycle costs of goods and services

• A workforce equipped with the skills needed to take advantage of green opportunities

Enabling Conditions


4. Green EconomySuccess Stories


Uganda – OA Transformation


Agricultural Dependence

Challenges

85% of the population 42% of GDP, 80% of exports earnings

Uganda – OA Transformation


Organic Agriculture

OA Growth in Uganda

US$ 22.8 mil (2007/8)US$ 6.2 mil (2004/5)US$ 3.7 mil (2003/4)

OA Exports in Uganda

Climate Contribution

48‐68% lower carbon emissionCarbon Sequestration

Business Opportunity

Organic food & drink97% revenue –OECD countries

80% producer in developing countries

Bangladesh – Solar PV


Access to Electricity Rural Area

Challenges

70% no access, mostly rural area


Solar Home Systems (SHSs)

Grameen Shakti (GS)


Innovative Business Model

Micro‐lending concept Job creation + Community


Solar Home Systems (SHSs)

Grameen Shakti (GS)


Innovative Business Model

As of 2009

300,000 SHSs installed

20 technology centers set up

660 women employed

600 youth trained

In coming years

Planning to train 5,000 women

Instruct 10,000 school childern

Aiming to create

100,000 jobs by 2015

Brazil – Sustainable Cities

Urbanization Slum Growth

Challenges


Become almost synonymous


Curitiba, Bus Rapid Transit System, 45% public transport rider‐ship



Sustainable Planning Initiatives


THANK YOUUNEP GREEN ECONOMY INITIATIVE

www.unep.org/greeneconomy

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the role of green economy in sustainable development

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