A transition to a green economy could lift millions of people out of poverty and transform the livelihoods of many of the 1.3 billion people earning just a US$1.25 a day around the world, but only when supported by strong policies and public- and private-sector investments.
These are the findings of a new report, Building an Inclusive Green Economy for All, launched today at the Rio+20 summit by the Poverty-Environment Partnership (PEP), a network of bilateral aid agencies, development banks, UN agencies and international NGOs. The report finds that many developing and least developed countries are already pursuing a transition towards low-carbon, resource efficient economies.
Scaling-up current examples of the green economy in action – particularly in developing countries - has the potential to deliver a ‘triple bottom line’ of job-creating economic growth, environmental sustainability and social inclusion, says the report.
But targeted investments and governance reforms are needed to overcome current barriers that are preventing many poor communities from fully benefiting from a green economy.
The new report finds that many Least Developed Countries, as well as many poor regions of middle income countries, are actually richly endowed with the natural resources that would allow them to build green economies that can sustainably reduce poverty.
“Many least developed and developing countries and communities are seizing the opportunity to bring economy and ecology together in order to generate transformational social outcomes,” said Achim Steiner, UN Under-Secretary General and Executive Director of the UN Environment Programme (UNEP), a PEP member, at the launch of the report in Rio de Janeiro.
“The challenge for world leaders meeting here at Rio+20 is to forge and to back the enabling policies, catalytic financing, and social protection packages in order to fast forward these ambitions and to take them to scale.”
The new report argues that large numbers of least developed countries and poor regions of middle income countries are actually richly endowed with the natural resources needed to underpin a green economy transition as a pathway towards realizing sustainable development.
“By embracing an inclusive green economy, leaders in Rio have a rare opportunity to improve the lives of millions of people and usher in a new era of sustainability,” said Manish Bapna, Acting President of the World Resources Institute, which co-ordinated the study.
“Shifting to an inclusive green economy will not happen on its own. It requires smart government policies and strong leadership. This report presents a bold vision for a green economy that can tackle poverty and inequality, and, importantly, it offers concrete and practical building blocks to make this transition.”
The report cites many strong examples of developing countries that are already successfully shifting to a green economy. For example:
Ethiopia is developing six wind energy projects and a geothermal project, which will increase the country’s capacity by over 1,000 megawatts.
Mongolia’s first 50 megawatt wind farm is currently under construction and is set to generate an estimated five per cent of the county’s electricity needs, while reducing air pollution linked with coal-fired generation. Mongolia has the potential to act as a “supergrid” in the region, supplying neighbouring countries with clean energy.
In Uganda, the promotion of organic agriculture is helping tens of thousands of farmers to earn up to 300 percent more from certified pineapple, ginger, vanilla and other exports. Globally, the market for organic food products has increased three-fold since 2000.
On the international level, the development of Reduced Emissions from Deforestation and Forest Degradation (REDD or REDD+) also offers potential for poverty eradication if accompanied by rigorous social safeguards especially for local and indigenous people. For example, in Indonesia, a US $1 billion REDD+ investment by Norway has led to a one year moratorium on logging in Kalimantan, has the potential to safeguard 45 per cent of the province’s forests, while providing new livelihood and income opportunities for local people.
Many low and middle-income countries are rich in resources for ecotourism; a sector that is projected to generate revenues of US $240 billion in 2012. Much of this growth is in developing countries as diverse as Botswana, Belize, Brazil, Costa Rica, Gabon, Kenya and Nepal.
Least developed countries with less developed infrastructure, particularly in urban areas, can benefit from an inclusive green economy with the right enabling policies and targeted international investments in areas from energy efficiency and clean technologies to modern public transportation systems.
Such efforts can also serve to boost the creation of decent, green jobs. In Lagos, Nigeria, public-private partnerships to improve the city’s infrastructure, reduce congestion and upgrade slums have helped create around 4,000 environment-related jobs among unemployed youth.
Regarding health, environmental risk factors are the cause of around one-fifth of the total disease burden in developing countries, and a large proportion of childhood deaths.
Many green economy investments have the potential to deliver significant benefits for human health. For example, supporting clean fuels and vehicles will lower greenhouse gas emissions, while also reducing respiratory diseases. Similarly, investing in cleaner energy for households in developing countries, such as through more efficient cookstoves, can reduce dependency on wood fuel and tackle deforestation, while limiting exposure to indoor air pollution.
The report underlines that the private sector, including large multinationals and small- and medium-sized enterprises, along with non-governmental organizations have a key enabling role too.
Unilever is working in West Africa with 10,500 small-scale farmers to promote allanblackia trees, which produce seeds rich in oil for use in spreads under the brand names Flora and Bercel
In Brazil, the cosmetics company Natura has forged partnerships with 26 communities to source new cosmetics, fragrances, and other products under a benefit sharing project that supports the principles of the UNEP-linked Convention on Biological Diversity
The Indian-based Jain Irrigation System makes drip and sprinkler irrigation systems while providing markets for farmers’ produce. Farmers in parts of India have seen net incomes rise by US $100 to $1,000 a hectare as a result of adopting such systems while also reducing water use and environmental impacts.
“There is strong evidence that a transition to a low-carbon, resource-efficient green economy could hugely benefit the poor while helping preserve vital ecosystem services,” said Johan Kuylenstierna, executive director of the Stockholm Environment Institute, a PEP member and co-author of the report.
“The challenge at Rio+20 is to make strong international commitments that will ensure the green economy can grow and flourish, with both public- and private-sector support. We also need to adopt policies to protect the vulnerable as their economies make this transition, and to ensure that the benefits of the green economy are fairly and equitably distributed.”
“In the Asia-Pacific region, the twin tracks of investing in sustainable inclusive infrastructure and the sustainable management of critical ecosystems to support future economic development can make a huge impact on the welfare of the poor – in both urban and rural settings,” said Bindu N. Lohani, Vice-President for Knowledge Management and Sustainable Development, Asian Development Bank.
“Regional institutions must galvanize efforts by governments to create the right enabling policies and channel financial resources into inclusive green growth - the kind of growth that benefits the developing countries and the poorer members of their populations.”
The report calls on delegates meeting for the Rio+20 Summit to consider “five critical building blocks” towards an inclusive green economy. These can maximize the benefits for the poor of a green economy, and foster a shared policy agenda between developing country governments, developed country partners and other stakeholders.
National Economic and Social Policies: Fiscal policies, tax regimes, and ‘green’ social protection policies and programmes can strengthen a pro-poor transition;
Local Rights and Capacities: Ensuring poor people have rights and tenure over their natural resources backed by the means and the incentives to sustainably manage and benefit from them;
Inclusive Green Markets: New business models are needed to build and expand the poor’s access to inclusive markets and supply chains for green products and services, together with access to micro-credit and business development services for small and medium-scale enterprises;
Harmonized International Policies and Support: Higher-income countries need to provide coherent aid, trade and other policies to enable low-income countries to succeed in a green economy transition; and
New Metrics for Measuring Progress: Going beyond the narrowness of GDP to a broader indicator of economic, social and environmental progress and human well-being: this is a key issue on the table at Rio+20.
Note to Editors:
Building An Inclusive Green Economy For All: Opportunities and Challenges for Overcoming Poverty and Inequality will be launched at 1pm on 14 June at the Press Centre at Rio Centro.
The publication has been prepared by staff from Asian Development Bank, Australia (AusAid); Finland’s Ministry of Foreign Affairs; Germany’s GIZ; the International Institute for Environment and Development; the International Union for the Conservation of Nature; the Organization for Economic Cooperation and Development; the UN Development Programme; the UN Environment Programme; the World Bank; the World Business Council for Sustainable Development and the World Resources Institute.