The crisis of the 3 F’s (financial, food and fuel) significantly modified the global context when comparing to the 2007 situation: unemployment increased from 18 to 51 million and the number of extremely poor people increased by at least 100 million people worldwide; energy bills in the developing countries rose by 400 billion USD; and food prices increased by 324 billion USD for developing countries. In response, there have been prominent and expensive efforts to put the economy back on its feet, although largely on the same basis as before. Yet many believe that the crisis is an opportunity to amend economic organization – so that it no longer prioritizes economic growth over environmental sustainability, social justice and equity.
Indeed, our dominant economic model has led us to consume more biomass than the earth produces on an ongoing basis, i.e. our collective ecological footprint already exceeds planet earth. We depleted natural capital whose ecosystem services are a key part of the well-being of the poor, thus exacerbating persistent poverty. The global risks our dominant model created – both social risks from persistent and wide distributional disparities, and environmental risks from GHG emissions far exceeding the earth’s absorptive capacity - are serious threats to our own and to future generations.
At international level there is currently significant momentum to foster the transition to a green economy: a very important number of international meetings took place last year in which governments have supported a green economic transition. Of particular note was the Decision in December 2009 by the United Nations General Assembly pursuant to Resolution 64/236 to convene a United Nations Conference on Sustainable Development in Rio de Janeiro in 2012 (Rio+20). The themes for Rio+20 will include: “a green economy in the context of sustainable development and poverty eradication and the institutional framework for sustainable development”.
Conceptual Issues:
A green economy is typically understood as an economic system that is compatible with the natural environment, is environmentally friendly, is ecological, and for many groups, is also socially just. These attributes are the conditions that must be imposed on an economy from the perspective of many green economy advocates. This conventional concept of a green economy may be alternatively described as “the greening of an economy”. Some fundamental criteria for meeting these conditions have been established since Rio, such as using renewable resources within their regenerative capacity, making up for the loss of non-renewable resources by creating their renewable substitutes, limiting pollution within the sink functions of nature, and maintaining ecosystem stability and resilience[i].
Conditions for social justice may include: 1) not compromising future generations’ capability to meet their needs; 2) the rights of poor countries and poor people to development and the obligations of rich countries and rich people to changing their excessive consumption levels; 3) equal treatment of women in access to resources and opportunities; and 4) ensuring decent labor conditions. Additionally, issues of good governance and democracy are also seen as critical for ensuring social justice and equity.
Less understood but should be of a much greater interest is a green economy as an economic system that is dominated by investing in, producing, trading, distributing, and consuming not only environmentally friendly[ii] but also environmentally enhancing[iii] products and services. In this sense, many green conditions such as those listed above should no longer be seen as constraints on an economy; instead, they should be regarded as forces that generate new economic opportunities. This is about expanding and reshaping, not reducing, the space for economic development and poverty reduction.
A green economy is one dominated and driven by the demand for, and supply of, environmentally friendly and environmentally enhancing products and services, which in turn safeguard and enhance human well-being. A defining indicator of a green economy, accordingly, is the share of environmentally friendly and environmentally enhancing products and services as a whole in total output and employment.
Working definition of a Green Economy
A Green Economy is a system of economic activities related to the production, distribution and consumption of goods and services that results in improved human well-being over the long term, whilst not exposing future generations to significant environmental risks and ecological scarcities.
A green economy is characterized by substantially increased investments in green sectors, supported by enabling policy reforms. These investments, both public and private, provide the mechanism for the reconfiguration of businesses, infrastructure and institutions, and the adoption of sustainable consumption and production processes. Such reconfiguration leads to a higher share of green sectors in GDP, more and decent green jobs, lower energy and materials intensities of production, lower waste and pollution, and much lower greenhouse gas emissions.
UNEP Green Economy Initiative (GEI)
The Green Economy Initiative launched by the United Nations Environment Programme in October 2008 is aimed at seizing the opportunities this modern concept of a green economy has to offer. It seeks to accomplish two tasks. First, it tries to make a “beyond-anecdotal” macroeconomic case for investing in sectors that produce environmentally friendly or environmentally enhancing products and services (“green investment”). By a “macroeconomic case”, it mainly refers to the contribution of green investment to output and job growth. Second, the initiative tries to provide guidance on how to boost pro-poor green investment. The goal is to encourage and enable policymakers to support increased green investment from both the public and private sectors.
It aims at advising countries in greening their economies by working with a wide range of partners to provide cutting edge economic analysis and research products. It encompasses a wide range of issues ranging from: Energy efficiency in old and new buildings; Renewable energy technologies, such as wind, solar, geothermal and biomass; Sustainable transport technologies, such as hybrid vehicles, high speed rail and bus rapid transit systems; Natural resource ‘green infrastructure’, including freshwater, forests, and soils; and Sustainable agriculture, including organic production. The UNEP GEI activities include providing advisory services to countries interested in greening their economies; producing research products, such as The Green Economy Report, The Economics of Ecosystems and Biodiversity (TEEB) series of reports, and the Green Jobs Report; and engaging partners to effectively promote and implement green economy strategies.
