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Green economy will promote growth, says UN

Investing $1.3 trillion – or 2% of global GDP – in “green” initiatives each year between now and 2050 will spur significant economic growth in the long run, according to a report published today by the United Nations Environment Program (UNEP).

The report, released in Nairobi, Kenya at the annual meeting of UNEP’s governing council, says there will be some short-term pain – jobs lost, and GDP growth cut back – in transitioning to a ‘green’ economy, which favours low-carbon activities that use over-exploited natural resources (such as water and forests) more efficiently. But in the end such changes would be “far less disruptive than a world running low on drinking water and productive land, set against the backdrop of climate change, extreme weather events and rising natural resource scarcities,” it says.

Like a pruned plant, this pared-back sustainable economy would blossom, boosting GDP growth rates beyond business-as-usual levels within 5-10 years.

The report is meant as a primer for policy makers in the lead up to the fourth Earth Summit, called Rio+20, to be held in Rio de Janeiro in 2012, which intends to focus on establishing a green economy.


The idea of a “green economy” has been debated for a few years by environmental economists and policy makers (economist Peter Victor recently took on this theme, ‘Questioning economic growth’ in Nature, 468; 370-371). At its core is the belief that economic activity should incorporate a more sustainable way of living. This contrasts with today’s so-called “brown economy”, which achieves economic growth at the expense of the natural world.

While other reports have suggested that the green economy would promote job growth, particularly in clean energy, UNEP’s puts a number on what investment is necessary to go down this path.

The report recommends investments in green projects in agriculture, buildings, energy, fisheries, forests, manufacturing, tourism, transport, water and waste management. A quarter of the money would go to natural resources projects focused on agriculture, fisheries, forests and water.

The aim is to conserve biodiversity, increase crop yields and sustainably harvest our oceans and forests, while managing resources better. For example, crop yield increases of the past century have been remarkable, but they have also hurt soil quality due to fertilizer use. Better to decouple our growth from negative impacts on the environment, the report notes.

While the long term benefits of a green economy are assured, there are short term drawbacks. Among them will be a loss of jobs in old economy industries. Fisheries may be heavily affected in the medium-term, for example, as fish stocks are allowed to recover to prevent a permanent loss of jobs. There will be a lag time as workers get re-skilled and by 2030, total employment will be 1.5% lower than under business-as-usual scenarios.But by 2050, the report states, jobs will recover and the green economy will have 0.6% more employment.

Some sectors of the green economy, such as clean energy, have already seen significant investments. Nations invested $180 to 200 billion in renewable energy last year. Much of it is driven by developing nations, with China, India and Brazil accounting for 40% of the investment in renewables in 2008.

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    Cheng Xiaofeng said:

    Could Science solve the problem which produced with the development of science and application of technology in the real world?

    Maybe the cost to develop the green economy is over the benefit we could reap from it.

    Most people know China has the largest production of Silicon materials for solar energy, but few people realized the serious pollution into soils during the process of production.

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