The report, Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication, also highlights enormous opportunities for decoupling waste generation from GDP growth, including in recovery and recycling.
The findings were presented today to environment ministers from over 100 countries at the opening of the UNEP Governing Council/Global Ministerial Environment Forum.
According to the UN, such an investment complemented by forward-looking national and international policies, would grow the global economy at around the same rate if not higher than those forecast, under current economic models.
At the same time, it would also help national economies avoid debilitating price shocks associated with a dependence on fossil fuels.
“Governments have a central role in changing laws and policies, and in investing public money in public wealth to make the transition possible,” said Pavan Sukhdev, , head of UNEP's Green Economy Initiative, in a statement.
“By doing so, they can also unleash the trillions of dollars of private capital in favour of a green economy,” Sukhdev said.
Currently, according to the report, the world spends between one and two per cent of global GDP on a range of subsidies that often perpetuate unsustainable resources use in areas such as fossil fuels, agriculture, including pesticide subsidies, water and fisheries.
Many of these are contributing to environmental damage and inefficiencies in the global economy, and phasing them down or phasing them out would generate multiple benefits while freeing up resources to finance a green economy transition.
In addition to higher growth, an overall transition to a green economy would realize per capita incomes higher than under current economic models, while reducing the carbon footprint of the developed world by by nearly 50 percent in 2050.
The report sees a green economy as not only relevant to more developed economies but as a key catalyst for growth and poverty eradication in developing ones too, where in some cases close to 90 per cent of the GDP of the poor is linked to nature or natural capital such as forests and freshwaters.
Among the examples it cites is India, where over 80 per cent of the $8 billion National Rural Employment Guarantee Act, which underwrites at least 100 days of paid work for rural households, invests in water conservation, irrigation and land development.
This has generated three billion working days-worth of employment benefiting close to 60 million households, the report notes.
At the same time, it said two per cent of the combined GDP of Cambodia, Indonesia, the Philippines and Vietnam is currently lost as a result of water-borne diseases due to inadequate sanitation.
Policies that re-direct over a tenth of a per cent of global GDP per year would assist in not only addressing the sanitation challenge but conserve freshwater by reducing water demand by a fifth by 2050 compared to projected trends.
The report acknowledges that in the short-term, job losses in some sectors are inevitable if they are to transition towards sustainability.
However, it makes the case that over time the number of "new and decent jobs created" in sectors - ranging from renewable energies to more sustainable agriculture - will more than offset those lost from the former "brown economy".
Employment levels in the energy sector would be one-fifth higher than under a business as usual scenario as renewable energies take close to 30 per cent of the share of primary global energy demand by mid century.
Further, it says that investing about one and a quarter per cent of global GDP each year in energy efficiency and renewable energies could cut global primary energy demand by nine per cent in 2020 and close to 40 per cent by 2050.
Savings on capital and fuel costs in power generation would under a green economy scenario, be on average $760 billion a year between 2010 and 2050.
The report was compiled by the UN Environment Programme in collaboration with economists and experts worldwide; itis aimed at accelerating sustainable development and forms part of UNEP's contribution to the preparation of the Rio+20 conference scheduled in Brazil next year.
According to Sukhdev, "misallocation of capital is at the centre of the world's current dilemmas and there are fast actions that can be taken starting literally today - from phasing down and phasing out the over $600 billion in global fossil fuel subsidizes to re-directing the more than $20 billion subsidies perversely rewarding those involved in unsustainable fisheries.”
“A green economy is not about stifling growth and prosperity, it is about reconnecting with what is real wealth; re-investing in rather than just mining natural capital; and, favouring the many over the few,” he continued. “It is also about a global economy that recognizes the intergenerational responsibility of nations to hand over a healthy, functioning and productive planet to the young people of today and those yet to be born.”
For additional information:
Towards a Green Economy: Pathways to Sustainable Development and Poverty Eradication
