UN Reveals Paradigm Shift For Global Green Economy February 21, 2011

Evening traffic in California. A UN report has called the $600 billion paid out globally each year in the form of fossil fuel subsidies ‘perverse.’ UN experts say investing 2 percent of global income into the green economy would boost jobs and growth. (Reuters Photo/Mike Blake)

 

Paris. The United Nations on Monday unveiled a strategy to ensure a sustainable future for the planet by investing 2 percent of wealth generated by the global economy, or some $1.3 trillion annually, in 10 key sectors.

This paradigm shift toward a “green economy” would also help alleviate chronic poverty, the UN Environment Program said in a report that was released as more than 100 environment ministers meet in Nairobi, Kenya.

Under the UN strategy, individual incomes would outstrip trajectories forecast by traditional economic models while halving humanity’s per capita ecological footprint by 2050.

Reshuffling the global economic mix will challenge vested interests and disrupt employment, the UNEP acknowledged.

But the plan promises to generate growth rates equal to or higher than a business-as-usual approach that — even as it stoked two centuries of breakneck industrialization — slowly eroded earth’s capacity to cope.

“We must continue to develop and grow our economies,” said the UNEP’s executive director, Achim Steiner, as he unveiled the study, “Toward a Green Economy: A Synthesis for Policy Makers.”

“But this development cannot come at the expense of the very life-support systems on land, in the oceans or in our atmosphere that sustain our economies and thus the lives of each and every one of us.”

The report notes that long-simmering crises erupted into plain view during the first decade of the 21st century.

Accelerating climate change, the dramatic loss of biodiversity, flaring food shortages, a growing gap between demand and supply for fresh water and the destruction of life-giving tropical forests were reminders that earth’s balance and bounty cannot be taken for granted, it says.

At the same time, it says, the financial meltdown of 2008 points to deep-seated structural problems in the global economy.

“Although the causes of these crises vary, at a fundamental level they all share a common feature: the misallocation of capital,” said Pavan Sukhdev, a Deutsche Bank analyst who headed the UN’s green economy initiative.

The report singles out “perverse” incentives that encourage unsustainable behavior, including $600 billion doled out every year in fossil fuel subsidies and $20 billion to industrial fisheries chasing dwindling stocks.

The UN called on political leaders to blaze the trail.

“Governments have a central role in changing laws and policies, and investing public money in public wealth to make the transition possible,” Sukhdev said.

Action from the public sector will “unleash trillions of dollars of private capital in favor of a green economy,” he added.

The report seeks to counter what it describes as “myths” about so-called green growth, starting with the idea that greater environmental sustainability means less economic progress.

“There is now substantial evidence that the ‘greening’ of economies neither inhibits wealth creation nor employment opportunities,” it says.

A green economy is defined as one that is “low carbon, resource efficient and socially inclusive.”

Future investment, the report argues, must shift to renewable energy, public transportation, energy efficiency, sustainable agriculture and measures to protect ecosystems and biodiversity.

Energy-related investment alone would top $350 billion a year, followed by nearly $200 billion for developing and greening the transportation sector, $134 billion each for the building and tourism sectors and another $76 billion for improving efficiency in industry.

The report aims to help set the agenda for “Rio+20,” a global summit next year slated to take stock of earth’s environmental health two decades after the landmark Earth Summit in Brazil laid out bedrock principles for sustainable development.

Agence France-Presse