Towards a Green Economy Bogota, 29th February Pavan Sukhdev McKluskey Fellow 2011, Yale University Founder-CEO, GIST Advisory Green Economy : Definition “A Green Economy is defined as one that results in improved human well-being and social equity, whilst significantly reducing environmental risks and ecological scarcities.” Green Economy and Sustainable Development: Green Economy is the best economic vehicle to achieve sustainable development goals. Source: UNEP Green Economy Initiative Green Economy : Definition “A Green Economy is defined as one “Environmentally friendly GDP that results in improved human Growth” of UNESCAP 2005 & “Green Growth” models well-being and social equity, whilst significantly reducing environmental Growth in risks and ecological scarcities.” per-capita inclusive wealth Green Economy and Sustainable Dasgupta Arrow, Dasgupta, Development: Green Economy is the Maler best economic vehicle to achieve Growth in sustainable development goals. Comprehensive wealth Stiglitz Stiglitz - Sen – Fitoussi Source: UNEP Green Economy Initiative Green Economy / “Green Growth” “A Green Economy is defined as one that results in improved human well-being and social equity, whilst significantly reducing environmental risks and ecological scarcities.” From GGKP, Mexico City, Jan 2012 :- “Green Growth is about making growth processes (a) resource- efficient, (b) cleaner and (c) more resilient without necessarily slowing them.” (Geoff Heal) “Green Growth is when economic growth and environmental gain are complements not substitutes” (Richard Morgenstern) Source: UNEP Green Economy Initiative Green Economy Initiatives . Developing nations actively promoting green economy . Barbados National Strategic Plan, 2006-2025 . Brazil (State of Sao Paulo) Green Economy plan . Cambodia Green Economy Roadmap, 2009 . China investing US$ 468 bn. to green key sectors in its 12th five-year plan (2011-2015) vs US$ 211 bn. in the last plan . Indonesia (Province of Kalimantan Tengah) Green Economy Taskforce, 2012, and National Planning to “Green” Economic Corridors . Malaysia (State of Sabah) Development Corridor Plan, 2008-25 . Mexico to launch “Green Economy Scoping Study” . South Africa National Green Economy Plan . South Korea from Green New Deal (2008) to “5YGGP” (2009-2013) Source: UNEP Green Economy Initiative Green Economy Initiatives . UNEP is supporting initiatives in over 20 countries . Africa as a Focus Region : Ghana, Egypt, Mali, Burkina Faso, Rwanda, Senegal, South Africa, Africa Regional (UNU-INRA) . Emerging Europe : Armenia, Azerbaijan, Moldova, Montenegro, Serbia, Regional (UNECE) Source: UNEP Green Economy Initiative Green Economy: Two Pathways Meeting the dual goals of sustainability – High human development and low ecological impact Source: WWF Living Planet Report 2006 Source: United Nations Human Development Index UNEP – GREEN ECONOMY INITIATIVE UNEP – GREEN ECONOMY INITIATIVE UNEP’s Green Economy Report FOCUS STRATEGY • Design and drive • Establish “Enabling Conditions” transformation in key (regulations, subsidies, taxes sectors critical / highly and related reforms) material for “greening” • Promote public and private the global economy investment KEY SECTORS • Agriculture, Freshwater, Forests, Fisheries, Energy, Transportation, Manufacturing, Waste, Buildings, Cities, Tourism SCENARIO ANALYSIS • “T-21” model, includes Natural Capital , to forecast outcomes on Capital stock, GDP growth, Employment Source: UNEP Green Economy InitiativeUNEP – GREEN ECONOMY INITIATIVE Agriculture : Importance of Small Farms • Approximately 2.6 billion • 10 percent increase in farm people rely on agricultural yields -> 7 % reduction in production systems for their poverty in Africa, more than livelihood. (FAO, 2009) 5 % in Asia • 525 million small farms world wide, 404 million less • Green farming practices have than two hectares of land increased yields, especially on (Nagayets, 2005), Small small farms, between 79 % farms cultivate 60 % of (Pretty et al, 2006) and 180 %. 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. UNEP – GREEN ECONOMY INITIATIVE UNEP – GREEN ECONOMY INITIATIVE Green Economy: Reduces Ecological Scarcities Source: T-21 Model, UNEP Green Economy Report Green Economy: over time, achieves higher growth rates GDP growth (%) Source: T-21 Model, UNEP Green Economy Report Green Economy Sectoral Success Stories 1. Solar Heaters in China China is world’s largest market Implementation Plan on for Solar Water Heaters Promoting Solar Thermal • 2/3rd of global capacity Utilization in 2007 (under 11th • 10% of population Five-Year Plan for New and • 4o mil SWH systems Renewable Energy) Economic Environmental Social Benefits Benefits Benefits Reduce risk of CO Industry/ Highly Reduce fossil fuel poisoning, Rheumatoid profitable consumption arthritis Household/ save fuel Save 348,000 t SCE of 600,000 employed costs (342 – 3321 yuan) fossil energy/ year Source: UNEP Green Economy Initiative (Developing Countries Success Stories) 2. Feed-in Tariffs in Kenya FTI Aspects Expected Benefits Enhancing Job Creation competitiveness (200,000 farmers) (5-6m factories) Mandatory Access to Use Grid Enhancing energy Coping with fuel security (500MW) scarcity and price Long-term Set Price Environmental Reducing fuel Power per kWh Integrity dependence Purchase “TRIPLE WIN” FTI Policy Observed Impacts 35 MW 15 MW(2008) • Facilitate resource mobilization Mumias Sugar Company • Reduce transaction costs + ten-year power purchase agreement • Encourage private investors @US Cents 6/kWh Source: UNEP Green Economy Initiative (Developing Countries Success Stories) 3. Organic Agriculture in Uganda OA Growth in Uganda Environmental Impact 48-68% lower carbon emissions 296,203 ha/ Carbon Sequestration 206,803 Low fertilizer use 60%/ 359% farmers increase (2008) 185,000 ha, 45,000 farmers (2004) OA Exports in Uganda Business Opportunity Organic food & drink market US$ 22.8 mil (2007/8) 97% revenue in OECD US$ 6.2 mil (2004/5) countries US$ 3.7 mil (2003/4) 80% producers in developing countries Source: UNEP Green Economy Initiative (Developing Countries Success Stories) 4. Sustainable Urban Planning in Brazil Urban City Planning Management Transport Planning Policy to transform Economic Benefits city and industry Per capita loss from severe Flood control -> congestion 6.7-11 times less turned vulnerable areas than other cities into parks Population increase in a Park with buses and bicycle Annual fuel losses (per capita) sustainable way paths (ecological asset + 4.3-13 times less than others 361,000 (1960) – 1,797,000 (2007) green infrastructure) Curitiba Industrial City (CIC) Fuel usage 30 percent lower 700 companies, 50,000 direct than other cities jobs, 150,000 indirect jobs Source: UNEP Green Economy Initiative (Developing Countries Success Stories) 5. Rural Ecological Infrastructure in India National Rural Employment Guarantee Act 2005 (NREGA) Objectives Guarantee wage and employment; Strengthen rural natural resource Key Benefits and Impacts management Improved rural livelihoods &inclusive growth Strategy -Work for 30 mln. families per year Labor-intensive implementation in - Wage increases of 25 % in 3 years 615 rural districts Improved rural ecological infrastructure - 850,000 water conservation works Ecosystem Initiatives under NREGA completed from 2006-08 Financing for rural works addressing - Estimated 5 mln. liters of water causes of drought, deforestation and conserved (in Uttar Pradesh,) soil erosion - Increased crop yields and ground water replenishment (in Andhra Pradesh) Source: UNEP Green Economy Initiative (Developing Countries Success Stories) 6. Forest Management in Nepal 1.9% rate of forest decrease 1.35% annual increase 1990s: Before 2000-05: With community forestry community forestry Community Forest User Groups (CFUGs) manage 25% of forest area Economic Environmental Social Benefits Benefits Benefits Develop their Set own harvesting Employment & Increased Community operational rules income for forest area & acceptance & plans local users density goodwill Decide Sustainable Enhanced soil Set rates for surplus wood fuel & water products income sources management distribution Source: UNEP Green Economy Initiative (Developing Countries Success Stories) 7. Ecosystem Services in Ecuador Water users contribute to Trust Fund for Protection of Water Quito, Ecuador gets 80% of (FONAG) its water supply from two ecological reserves FONAG finances critical ecosystem services for key hydrological functions Results . 65,000 ha of watersheds in improved management . Upstream farmers and local communities benefit . 1800 people receive economic benefits from conservation Source: UNEP Green Economy Initiative (Developing Countries Success Stories) 8. Solar Energy in Tunisia Challenge: Reduce Tunisia’s oil dependency Solution: Development & use of renewable energy - 50,000 Tunisian families benefit Current - 214,000 tonnes of cumulative CO2 National Solar Energy Plan Benefits emissions avoided Increase share of RE sources from -$1.1 billion energy savings, relative below 1% to 4.3% by 2014 to $200 million investment in clean energy infrastructure Tunisian Solar Programme (PROSOL) for solar water heating systems - Financial and fiscal support Future By 2016, -Reduced interest rates, VAT and Benefits -