What is a Green Economy ?
Definitions and Interpretations
Professor Roderick J. Lawrence
Roderick.Lawrence@unige.ch
What is a Green Economy ?
Definitions and Interpretations
Plan
1. Introduction
2. Definitions & Interpretations 3. Examples of Policy Definition 4. Key principles for future actions 5. Conclusion
Terminology of Green
Green Growth
Green Development Green Economy
Sustainable Development
What is Green ?
Working Definitions of Green
It is important to find agreement on working definitions of “green policies”, the “green economy” and “green jobs” so as to allow
different studies to be compared and the impacts of environmental policies to be assessed.
Determining an accepted definition of a “green job” is an ongoing task calling for further analysis and discussion
However one delineates the specific industries or tasks that define a green job, fundamentally a green job should be understood as one that both contributes to reducing the environmental footprint of the economy and meets the criteria for decent work.
(Source: ILO & OECD, (2012) Sustainable development,green growth and quality employment:
Realizing the potential for mutually reinforcing policies, pp. 3 & 4).
What is Green Growth?
OECD, Green Growth Strategy, May 2011.
It confirms the conviction of the OECD Ministerial Council Meeting in 2009, that green and growth can indeed go hand in hand.
The policy framework concerns getting the essentials right:
The institutional settings to improve resource management, encourage economic activity and foster innovation.
On the macro-economic front, there may be trade or investment barriers that inhibit the spread of green technologies and practices.
Green growth policies may have to be matched with poverty reduction goals, for instance.
Technological blockages can be removed, perhaps using subsidies or other incentives. Small businesses can be catalysts of innovation, and improving access to finance and enhancing communications
infrastructures.
There may be intellectual property rights to address.
(Source: OECD, (2011)Towards Green Growth. OECD, Paris).
What is Green Development?
Green development is a pattern of development that decouples growth from heavy dependence on resource use, carbon emissions and
environmental damage, and promotes growth through the creation of new green product markets, technologies, investments, and changes in
consumption and conservation behaviour.
Green development can become a potentially transformative process for the economy, for society, for the
environment, and for the role of government. It is an opportunity.
(Source: World Bank, 2011)
Tokyo
What is Green Development?
Three key concepts in green development are :
• that economic growth can be decoupled from rising GHG emissions and environmental degradation;
• that the process of “going green” can itself be a source of growth;
and
• that “going green” is part of a virtuous circle that is mutually-
reinforcing with growth. Green growth is the means by which green development is achieved.
•
(Source: World Bank, 2011)
Examples of National Green Development Strategies: Germany, Korea and Japan
Germany’s New Energy Plan.
In May 2011, Germany determined to close all of its nuclear plants by 2022 and to
become the first industrialized country to completely shift to clean energy by
increasing investment and R&D for
renewable energy and energy efficiency.
Presently, nuclear power provides 22
percent of Germany’s electricity. To fill the gap in its energy supply after it abandons nuclear, Germany has proposed vigorous development of wind, solar, and biomass;
new standards for the thermal efficiency of buildings; and the creation of a continent- wide super smart grid (which would include the import of power from sun-rich North Africa.
Examples of National Green Development Strategies: Germany, Korea and Japan
The Republic of Korea: implementation of green growth.
Born as a response to the global financial crisis of 2008, Korea’s move towards green growth combines three mutually-reinforcing objectives:
(1) responding to the latest economic crisis through a green stimulus, (2) reducing energy dependency,
(3) rebalancing the economy towards green sectors in the long term.
The financial crisis exposed Korea’s reliance on imported energy as a major weakness in its growth model. Korea imports 96% of its energy - accounting for 2/3 of all imports. To rebalance this situation by 2030, Korea aims to decrease its energy intensity by 46% and increase the share of renewable energy in total primary energy from 2.4% in 2007 to 11%. The latest Five-Year Plan allocates 2% of GDP to 10 green growth strategies, each containing quantitative objectives and well defined projects. Korea aims to increase its global market share of green technology exports from 2% in 2009 to 10% by 2020.
Examples of National Green Development Strategies: Germany, Korea and Japan
Japan’s energy efficiency strategy.
Japan’s energy intensity decreased 26% between 1980 and 2009, and it is one of the most energy efficient countries in the world. Nevertheless, Japan pledged to go further with its 2006 “Energy Conservation Law” by improving energy
efficiency by another 30% by 2030 relative to 2006.
The plan’s implementation strategy fosters energy
conservation technologies and develops a benchmarking approach to monitor energy conservation. In addition to promoting the most advanced technologies across the energy sector, the plan also introduces integrated energy consumption standards for all buildings and targets net zero-energy houses by 2020 (and the norm nationwide by 2030).
What is Green Economy ?
A Brief History of Green Economy
1. David Pearce, Anil Markandya and Edward Barbier, (1989).
Blueprint for a Green Economy, Earthscan Publications Ltd, London.
This book, commissioned by the UK Department of Environment, provides an introduction to the subject of environmental
economics and accounting strategies that could be employed in the pursuit of sustainable development. This concept which
embodies the idea of protecting the environment at the same time as meeting the objectives of economic growth, was
identified by the Brundtland Commission in their report ‘Our Common Future‘ (1987).
Definition of Green Economy
There is no agreed definition of what constitutes a green economy!
However there are a number of constituents that can be identified. The first Preparatory Meeting of the UNCSD identifies four:
1. The first approaches the question through the analysis of market failure and the internalization of externalities.
2. The second takes a systemic view of the economic structure and its impact on relevant aspects of sustainable development.
3. The third focuses on social goals (jobs, for example) and examines ancillary policies needed to reconcile social goals with the other
objectives of economic policy.
4. The fourth focuses on the macro-economic framework and development strategy with the goal of identifying dynamic pathways towards
sustainable development."
(Source: World Bank, 2011)
RIO+20 Conference
UNEP definition of Green Economy
“ A Green Economy is one that results in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities.”
RIO+20 Conference Objectives
• The objective of the Conference will be to secure renewed
political commitment for sustainable development, assessing the progress to date and the remaining gaps in the
implementation of the outcomes of the major summits on
sustainable development and addressing new and emerging challenges.
• The focus of the Conference will include the following themes to be discussed …: a green economy in the context of sustainable
development and poverty eradication and the institutional framework for sustainable development;
• The Conference will result in a focused political document.
Green Economy for Implementing Sustainable Development
Economic development
Social justice Environmental
protection Green Green
Econ
omy Econ
omy
Sustainable procurement
Removal of
environmentally harmful subsidies
“Green tax system”
Sustainable use of natural resources
(Source: Swiss Federal Office of the Environment)
Policy Instruments for a Green Economy
The United Nations Secretary General's report highlights the following policy options:
1. Getting prices right, including removing subsidies, valuing natural resources and imposing taxes on things that harm the environment in order to internalize externalities, support sustainable consumption and incentivize business choices. It is grounded in the principles of
environmental economics.
2. Public procurement policies to promote greening of business and markets.
3. Ecological tax reforms based mainly on the experience of European countries. The basic idea is that shifting the tax base away from "good"
factors of production such as labour to "bad" factors such as pollution will allow for a double dividend: correcting environmental externalities while boosting employment.
Policy Instruments for a Green Economy
4. Public investment in sustainable infrastructure (including public transport, renewable energy and retrofitting of existing infrastructure and buildings for improved energy efficiency) and natural capital, to restore, maintain and, where possible, enhance the stock of natural capital. This has particular salience within the current recessionary context, given the need for public expenditure on stimulus packages.
5. Targeted public support for research and development on
environmentally sound technologies, partly in order to compensate for private underinvestment in pre-commercial research and
development, and partly to stimulate investments in critical areas (such as renewable energy) with potentially high dynamic scale economies, and partly to offset the bias of current research and development towards dirty and hazardous technologies.
Policy Instruments for a Green Economy
6. Strategic investment through public sector development outlays, incentive programmes and partnerships, in order to lay the
foundation of a self-sustaining process of socially and environmentally sustainable economic growth.
7. Social policies to reconcile social goals with existing or proposed economic policies.
8. We need a comprehensive overview of the diversity of
movements and schools of thought relating to the element of a green economy that addresses 'the systemic view of the economic structure'.
United Nations Conference Review: 1972 - 2012
Main purpose Results
Stockholm 1972
Strengthening awareness of the environmental problems of the human beings
• Stockholm Principles on
Environment and Development
• UN Environment Programme
Rio 1992
Integrating environment and development through the
establishment of rules, policies and objectives
• Rio Declaration
• Agenda 21
• Rio conventions (Climate, Biodiversity, Desertification)
Jo‘burg 2002
Review implementation of Agenda 21
• Johannesburg Plan of Implementation
• Partnership Initiatives
Rio 2012
Renew political commitment to SD (with special focus on Green Economy and Governance)
• [„The Future We Want“]
• [SD Goals]
• [Register of initiatives]
(Source: Swiss Federal Office of the Environment)
Neo-liberal values Consensus Building Political Ecology
Economic system Human Society
Environmental context
WEAK SUSTAINABILITY STRONG SUSTAINABILITY
A (weak) B (medium) C (strong) D (very strong)
From weak to srtong sustainablility No environmental or social
protection without economic growth
Priority = monetary growth Time = short term Substition is possible
Reconcile environmental protection economic growth and equity
Priority = consenus Time = medium term Substitution is negotiable
Human societies are dependant on ecological systems Priority = environnemental
protection Time = long term
No subsitution is acceptable
Conflicting Interpretations of Sustainable Development
(Source: Dobson, 1996).
Confronting the Future
The Future we Want?
OR
The Future we Need?
Moving towards sustainability depends on significant action
now.
Implementing Co-benefits
What are co-benefits ?
The benefits of policies that are implemented at the same time – often for the realization of sector-based initiatives –which lead to positive outcomes beyond the intended benefits often in other sectors.
The term “co-benefits” appeared in the academic literature in the 1990s. It generated wider interest around the time of the Third
Assessment Report (AR3) of the Intergovernmental Panel on Climate Change (IPCC) published in 2001. The IPCC AR3 distinguished co-
benefits or the intended positive side effects of a policy from ancillary benefits or unintended positive side effects.
Example: Mitigation measures for climate change can lead to public health co-benefits.
Q: What are the co-benefits of a Social Green Economy that is just?
Confronting the Future
Questions for debate
1. Is it sufficient to make the market economy greener?
2. Can the function of the economy in society be redefined for sustainable development?
A Social Economy that is Just
New
Integrated Approach
Key References
Cook, S., Smith, K. & Utting, P. (2012). Green Economy or Green Society?
Contestation and Policies for a Fair Transition. United Nations Research Institute for Social Development, Geneva, Occasional paper.
Dobson, A. (1996). Environment sustainabilities: an analysis and a typology.
Environmental Politics, vol.5, no.3, pp.401 - 428.
Hezri, Adnan. A & Ghazali, Rospidah (2011). A Fair Green Economy? Studies of Agriculture, Energy and Waste initiatives in Malaysia. United Nations Research Institute for Social Development. Geneva, Occassional paper.
ILO & OECD, (2012) Sustainable development,green growth and quality employment:
Realizing the potential for mutually reinforcing policies
Organization for Economic Co-operation and Development (OECD) (2011).
Towards Green Growth: A Summary for Policy Makers. OECD, Paris.
United Nations Environment Programme (UNEP) (2011). Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication:
A synthesis for policy makers. UNEP Nairobi
World Bank (2011). Inclusive Green Growth: The Pathway to Sustainable Development. World Bank Washington DC.
World Wildlife Fund (2012). Living Planet Report. Gland, Switzerland.
