UNEP Report : Green economy can reduce poverty and help meet millennium development goals

Investing in clean energy, sustainable transport, forests and environmentally-friendly agriculture is essential, if internationally-agreed goals to reduce poverty are to be achieved.

This is among the central conclusions of A Brief for Policymakers on the Green Economy and the Millennium Development Goals (MDGs), launched today as heads of state and ministers meet at the UN Headquarters to review progress to date - five years before the MDG deadline of 2015.

Environmental degradation is making it more difficult for governments to achieve Millennium Development Goals such as improving maternal health, providing safe drinking water and combating hunger and disease.

Conversely some countries and communities are finding that environmental improvements, catalyzed by deliberate policy choices; smart investments and often private sector partnerships can be a big part of the solution, the new study claims.

Achim Steiner, UN Under-Secretary General and Executive Director of the UN Environment Programme (UNEP), said: “There is rapidly growing evidence that accelerating a transition to a low carbon, resource efficient, employment-generating Green Economy may not only be the key to meeting sustainability challenges of the 21st century, but also provide a considerable contribution to meeting other MDGs.

The report - compiled by UNEP’s Green Economy team - cites numerous cases where green strategies are paying multiple dividends in respect to the eight MDGs.

Policies and investments in Costa Rica have triggered an expansion of protected areas and national parks, now covering over 25 per cent of the country’s total land area.

• Since this strategy was adopted there has been a boom in eco-tourism attracting over one million visitors a year and generating USD $5 million annually in entrance fees alone. Studies indicate that communities living in or near national parks have higher wages, employment rates and lower rates of poverty.

The report, prepared for this week’s UN Summit on MDGs in New York, also spotlights China’s energy policy as set out in the country’s 11th five year plan covering 2006-2010. The plan has fuelled a rapid rise in renewable energy manufacturing and installation.

• China is now the world’s second biggest user of wind power and the biggest exporter of photovoltaics (devices that covert solar energy into electricity). 10 per cent of households have solar water heaters and 1.5 million people are employed in China’s renewables sector, with 300,000 of those jobs generated in 2009 alone.

Creative and forward-looking urban planning, allied to sustainable transport policies, have allowed the Brazilian city of Curitiba to grow more than six fold while simultaneously improving mobility and quality of life.

• The average area of green space per person has risen from one square metre to around 50 square metres; 45 per cent of journeys are made by public transport; excessive fuel use due to congestion is 13 times less per person than in Sao Paulo and the lower levels of air pollution result in health benefits for local citizens.

In Nepal, 14,000 Forest User Groups have reversed the deforestation rates of the 1990s through community-based policies which include setting harvesting rules, product prices and the sharing of profits.

• Between 2000 and 2005, the annual forested area of Nepal increased by 1.3 per cent, soil quality and water supplies are better managed and local employment has risen.

Uganda, a country where 85 per cent of the working population is employed in agriculture, has turned to organic production to boost exports and incomes. Farm-gate prices for organic vanilla, ginger and pineapples are higher than for conventional produce.

• Since 2004, the number of certified organic farmers has grown from 45,000 to over 200,000 and the area of land under organic cultivation from 185,000 hectares to close to 300,000 hectares.

Mr Steiner said: “The underlying task of the 21st century is to provide a secure and sustainable way of life for a world population that over the next four decades will increase in size by a third. It was this challenge that in September 2000 led world leaders to adopt the eight MDGs”.

“On current trends it is likely that achieving all the MDGs by 2015 will be missed. In part because the responses so far have been embedded in a 20th century approach to a new century’s challenges,” he added.

“The Green Economy puts a fresh lens on the challenges and a spotlight on the multiple cost effective economic and social opportunities from investing and re-investing in modern clean-tech energy systems up to natural resource management of the planet’s ecological infrastructure. In doing so, it addresses the economic, social and environmental objective of sustainable development and underscores the wealth of choices and options for sustained progress that meets the realities of our time,” said Mr Steiner.

Some key points from the report - Environmental sustainability and the MDGs inextricably intertwined

The report, A Brief for Policymakers on the Green Economy and the Millennium Development Goals, underlines that the environmental goods and services that underpin the global economy - and in particular the GDP of the poor - are shrinking at a rapid rate.

It underscores how this loss of ecological infrastructure is undermining not only MDG7 on environmental sustainability but most if not all of the other MDGs and their associated targets.

Coral reefs in the Caribbean for example have declined by 80 per cent and globally 30 per cent of mangroves have been lost in the past two decades.

Both these ecosystems provide coastal defenses, tourism revenues and other services and income for local communities.

In addition they are nurseries for fish upon which a billion people rely directly for protein. The fate of coral reefs and mangroves are thus closely linked to the achievement of several MDGs, including MDG1 on hunger.

Forests are key sources of drinking water and nutrients for agriculture while providing essential goods such as wild foods and medicines.

Thus the fate of forests links to MDG1 on hunger, MDGs 4 and 5 on health and several targets of MDG7 such as halving the proportion of people without access to safe drinking water.

The rate of deforestation is slowing. In the past decade the annual loss of forest has averaged 13 million hectares, compared with 16 million hectares a year during the 1990s.

But this rate is still causing lasting environmental damage and currently close to 30 countries have lost 90 per cent of their original forest cover.

Investing and re-investing in forests would not only assist in meeting the aforementioned MDGs, but also in reducing greenhouse gas emissions linked with deforestation.

While there is no specific MDG for energy, the report points out that providing clean energy will underpin the success of many of the goals, both directly in terms of sustainable development and indirectly if climate change, linked to the burning of fossil fuels, is left unaddressed.

For example 14% of the population of developing countries and around a fifth of their urban dwellers live in low-lying coastal regions and are particularly vulnerable to the impacts of climate change, such as rising sea levels, coastal flooding and soil erosion.

Subsidies - A possible source of additional MDG funding

One way of financing the achievement of the MDGs is through re-directing subsidies.

Fossil fuels for example still attract over US$500 billion a year in government subsidies - and there is abundant evidence that these subsidies rarely reach the poor, despite the best intentions of governments.

• In Indonesia in 2005, 60 per cent of fuel subsidies went to the richest 40 per cent of the population.
• In 2003, Argentina’s gas subsidies went to the far south of the country - home to just three per cent of Argentina’s poor.
• In Mongolia, some 85 per cent of a recent ‘life-line’ heating tariff went to the ‘non-poor’.

Investing all or part of these subsidies in renewable energy technologies, such as solar and wind, could trigger new kinds of employment, faster access to electricity and greater social equity - a better overall standard of living.

There would be benefits for the environment including improvements in air pollution alongside an estimated six per cent cut in annual greenhouse gas emissions.

There are other green economy approaches: In Bangladesh a subsidiary of the Grameen Bank - Grameen Shakti - has pioneered microfinance to assist local people in buying solar heating systems.

Some 20,000 ‘green’ jobs, many of which have been for women, have been generated, with an aim of creating 100,000 new jobs by 2015. The project thus meets many of the MDGs including MDG3 relating to gender equality.

Similar arguments are made in respect to fisheries where subsidies total some US$27 billion a year and are part of the reason why fish stocks in many parts of the world are in decline.

Re-directing around US$8 billion of these subsidies into improved management measures such as marine protected areas, tradable quotas, the retiring of vessels and the retraining of fisher-folk, could boost catches and conserve stocks.

The report also points to the multiple benefits from other policies, for example those that promote the certification of biodiversity-friendly agricultural products.

With the right backing, the market for such products could be worth US$210 billion by 2020 up from US$40 billion in 2008, generating new income flows while conserving the planet’s natural capital.

Notes to Editors:

Launched in 2008 at the height of the global financial and economic crisis, UNEP’s Green Economy Initiative provides macroeconomic analysis on policy reforms and investments in key sectors that can contribute to economic growth, creation of jobs, social equity and poverty reduction, while addressing climate risks and other ecological challenges. The Initiative undertakes a wide-range of research and provides advisory services to more then 20 countries interested in moving towards a green economy.

This report is one of in a suite of special briefs that draws on the preliminary findings of its flagship publication, the Green Economy Report, which is scheduled to be released in early 2011.

Visit www.unep.org/greeneconomy to download the full report.