To begin industrial processes, people withdraw natural resources from the environment. The industrial system transforms these natural resources into nearly all of the products and services that we use--the food we eat, the clothes we wear, the cars we drive, the electricity we use to light our homes and power our computers. Virtually all of the natural resources that support this activity ultimately return to the environment, often in an altered form. This flow of materials from nature to the economy and back--the materials cycle--is fundamental to industrial economies.

The sheer scale of the process is remarkable and surprising, even in the most modern and efficient industrial economies. As this report documents, such economies require 45,000 to 85,000 kilograms of natural resources per person per year--the weekly per person equivalent of 300 shopping bags filled with materials, together weighing as much as a large luxury car.

The 1992 United Nations Earth Summit conference in Rio de Janeiro reached a broad consensus that the environmental resources of our planet are limited. Human activities, such as withdrawing natural resources, disposing of wastes, and modifying the landscape, can interfere with the planet\'s ability to support life. So sustaining a larger and more prosperous human society and providing for future generations requires decreasing the impact of economic activity on the environment. Natural resource use must be made more efficient and the growth of industrial economies decoupled from physical growth. Eventually, industrial societies\' dependence on natural resources must be reduced and our economies "dematerialized" to some degree.

Yet, our ability to track such trends and to calculate the costs and benefits of industrial activity isn\'t up to the task. Conventional national economic accounts simply do not provide the information needed, nor do the prices of natural resources give accurate signals of the long term costs to society of their use. This report proposes a way to enlarge our understanding of what sustainable economies require. It constructs a parallel set of national accounts in physical terms using material flow analysis and proposes new summary measures or indicators that can be used with economic indicators to give a far more accurate sense of the scale and consequences of industrial activity.

This analysis is particularly relevant in considering the expected global expansion of industrial activity. As human populations increase and industrial activity expands, pressures on the environment are intensifying. A four-or-five-fold expansion--the magnitude of expected growth in economic activity over the next half century--will present very serious environmental difficulties if the human use of natural resources and disposal of wastes grows apace. Yet, as this report shows, meaningful dematerialization--that is, an absolute reduction in per capita use of natural resources--is not yet occurring, even though over the past 20 years natural resource use has not risen as fast as economic activity. The world still has much to do to put itself on track toward a sustainable future.

This report results from a unique and productive international collaboration among our institutions. In such joint work may lie the best hope for finding broadly acceptable new approaches and powerful new insights that can stimulate the global transformation our societies need.

Jonathan Lash
President
World Resources Institute

Ernst Ulrich Von Weizsacker
President
Wuppertal Institute

Kees Zoeteman
Deputy Director-General for Environment
Netherlands Ministry for Housing, Spatial Planning, and Environment

Yoshinori Ishii
Director-General
National Institute for Environmental Studies