Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication

On 16 November, following three years of extensive global research, involving hundreds of experts, the United Nations Environment Programme (UNEP) released its flagship report Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication – a key contribution to the Rio+20 process and towards poverty reduction. The report’s key message: we only need to invest 2% of global GDP across ten crucial economic sectors to “kick-start a shift from the current brown, polluting and inefficient economy to a green one.” These sectors include: agriculture, energy, fisheries, manufacturing, transport, buildings, water, forests, tourism and waste management.

Changing towards a green economy is imperative considering the new challenges the world is currently facing, the report underlines. There is increasing recognition that conventional economic models are no longer sustainable, and that better management of the natural environment could, in the longer term, contribute to economic growth, prosperity and well-being. As such, the report aims to show that economic growth and sustainability do not necessarily bite each other. In fact, it notes, that – with spot on enabling and appropriate (inter)national policies – a transition towards a greener economy could spur economic growth rates; result in higher incomes per capita; and contribute to poverty alleviation. The effects for the environment, however, would be less harmful than the “business-as-usual approach” as a transition towards a green economy also entails private and public investments in natural capital. Investing in forests, water, or soil, for example, can reduce the burden carried by the rural poor. However, as the mentioned above, only investing in natural capital will not be sufficient. It is also crucial to invest in energy and resource efficiency. Moreover, “complementary investments are required in human capital, including green-related knowledge, management and technical skills to ensure a smooth transition to a more sustainable pathway,” the report adds. To support the initial stages of the transition to a green economy, both private and public capital are needed, preferably from new and innovative financing mechanisms, UNEP’s Green Economy Report explains.

Although some “brown” or unsustainable jobs might be lost in the early stages of the transition in some of the above mentioned economic sectors, it is expected that these job losses will be compensated for with the creation of new decent green jobs in sectors such as renewable energy or sustainable agriculture. However, the timeline to compensate for these job losses depend on the economic sector. The report shows that it will be more difficult to develop new jobs in sectors that are already facing economic challenges, such as fisheries. “In such cases, transitional arrangements are needed to protect workers from negative impacts on their livelihoods,” the report proposes.

It also highlights that although regulations, standards and targets are needed to guide the transition, developing countries will need to be given space to move at their own speed and with respect for their development challenges. Developed countries, however, should support developing countries through skills and capacity building, and in creating an international market and legal infrastructure for a green economy, the report notes.

It concludes by highlighting remaining gaps and questions that need further investigation in the future, including:

-  How to manage a smooth and fair transition form a brown economy to a green one at global level?

-  How to ensure that green policies are not used as a pretext for trade protectionism? And

-  How to measure progress in the transition to a green economy?

To download the report, click here.

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