Green Economy Initiative
United Nations Environment Programme
Moustapha Kamal Gueye
Acting Head, Green Economy Advisory Services Unit
A multidimensional crisis rooted
in patterns of development
The global context
Multiple crises: More than a financial and economic crisis:
• Social - 18 to 51 million unemployed over 2007 levels & the
number of extremely poor has increased by at least 100
million people worldwide.
• Fuel - rising prices cost developing economies US$ 400 bn
in higher energy bills in 2007.
• Food - prices cost developing countries US$ 324 bn in 2007.
• Ecosystems - EUR 50 bn worth of biodiversity is being lost
each year.
• Climate - current global GHG emissions at 42 Gt per annum
- 5 times higher than the threshold.
On a business as usual path…
By 2030 and beyond…




Global energy demand up by 45%
Oil price up to US$ 180 per barrel
GHG emissions up 45%
Global average temperature up 6°C in the next
century
 Sustained losses equivalent to 5-10% of global GDP
as compared to the 3% of GDP loss from the current
financial crisis
 Poor countries will suffer costs in excess of 10% of
their GDP
Discounting Natural Capital
• Global GDP more than
doubled between 1981
– 2005.
• But 60% of world’s
ecosystems
degraded/exploited
unsustainably (MEA,
2005).
Distribution of Costs -> Poor people
Natural capital is critical to wealth
creation in low income countries.
The role of environmental resources in
reducing poverty, fighting hunger, and
lowering child mortality
“…natural capital is essential to wealth creation, accounting for a quarter of wealth
creation in the poorest countries, while such a share is only 2% in the world’s richest
countries.”
Source: World Bank, 2006, Where is the wealth of nations?
Natural Capital
Our Capital Space… and our Economic
Compass…
Financial & Physical Capital
“We cannot manage what we do not measure”
7
Opportunity Amid Crisis
The Global Green New Deal
• Revive the world economy, create new and decent
jobs, and protect the vulnerable
• Reduce carbon dependency, ecosystem degradation,
and water scarcity - 1% of GDP in green sectors over
two years
• Eliminate persistent poverty by 2015…achieve the
MDGs
• Seed a process of transformative change by
rebalancing financial and economic capital, human
capital and natural capital
From : “Rethinking the Economic Recovery: A Global Green New Deal”, UNEP, Feb 2009
Green Stimulus
Green Stimulus Ranking as % of Total Stimulus of August 2009
(UNEP GGND Update to the G20 - September 2009)
South Korea
79%
China
34%
France
18%
Germany
US
South Africa
Mexico
13%
12%
11%
10%
Source: HSBC Global Research
G20 Green Stimulus Spending Per Sector
(US$ Billion)
140
120
100
80
60
40
20
Lo
w
Ca
rb
o
n
Ve
hic
les
S/
Ot
he
r
eP
wa
bl
Re
ne
CC
ow
er
EE
ing
Bu
ild
as
te
at
er
/w
W
Gr
id
Ra
il
0
Source: HSBC Global Research, UNEP
South Africa’s Green Stimulus
• South Africa launched a $7.5 bn fiscal stimulus for 2009-2011.
• Around 11% or $0.8 billion was allocated to environment-related themes.
Beyond Green Stimulus:
Transition towards a
Green Economy
Definition of Green Economy
• A Green Economy is characterized by
substantially increased investments in economic
sectors that build on and enhance the earth’s
natural capital or reduce ecological scarcities and
environmental risks.
• These investments are driven by or supported by
national policy reforms and the development of
international policy and market infrastructure.
Green Economy Initiative Components
A global
Green
Economy
Report
Green
Jobs
Initiative
A Global
Green
New Deal
(GGND)
GEI
A Green
Economy
Coalition
Country
level
assistance
Regional
initiatives
TEEB
JCI
Fostering a Green Economy in Africa
“We see the green economy as an opportunity
to respond to the notion that there is a tradeoff to be made between faster economic
growth and sustainable development, and
the preservation of our environment”
President Jacob Zuma, South Africa
Enhancing natural capital, Expanding wealth creation
• Approximately 2.6 billion
people rely on
agricultural production
systems for their
livelihood (FAO 2009)
• 10% increase in farm
yields -> 7% reduction in
poverty in Africa, more
than 5% in Asia
• 525 million small
farms world wide, 404
million less than two
hectares of land
(Nagayets 2005)
• Small farms cultivate
60% of arable land
(Herren et al. 2010)
• Green farming practices
have increased yields,
especially on small farms,
between 79 and 180%.
An increase in overall GDP coming from agricultural labor productivity is on average 2.5
times more effective in raising the incomes of the poorest quintile in developing countries
than an equivalent increase in GDP coming from non-agricultural labor productivity.
UNEP – GREEN ECONOMY INITIATIVE
UNEP – GREEN ECONOMY INITIATIVE
Uganda’s Organic Agriculture Transformation
Organic Agriculture
60%/ 359%
increase
296,203 ha/
206,803
farmers
(2008)
48-68% lower carbon emission
Carbon Sequestration
185,000 ha,
45,000 farmers
(2004)
Organic food & drinks:
97% of revenues
in OECD countries
80% of producer
in developing countries
A $ 50 bn global
market growing
at 10% per
annum.
US$ 22.8 mil (2007/8)
US$ 6.2 mil (2004/5)
US$ 3.7 mil (2003/4)
OA Exports in Uganda
UNEP – Green Economy Initiative
Greening Industrialisation
Comparison of Energy Intensities
0.4
0.35
equivalent)
0.3
0.25
0.2
0.15
0.1
0.05
Year
World
Sub-Saharan Africa
Latin America & Caribbean
South Asia
Source: International Energy Agency, and World Bank PPP data.
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
0
1990
(kg of oil per constant 2005 PPP $
Unit of energy use per unit of GDP
0.45
GDP and Environment Performance Index in Africa
Relationship between 2010 EPI and GDP for African Countries
Environmental Performance Index
(EPI)
100.0
90.0
80.0
70.0
Mauritius
Ivory Coast
Namibia
60.0
Tunisia
Kenya
50.0
Morocco
Algeria
Egypt
Libya
South Africa
Ethiopia
40.0
Cameroon
30.0
Nigeria
Angola
Senegal
20.0
Niger
2
R = 0.0445
10.0
0.0
4.50E+08
1.00E+11
2.00E+11
3.00E+11
GDP (2010 US$)
The EPI is constructed from the scores of two policy objectives: Environmental
Health, and Ecosystem Vitality.
Source: 2010 Environment Performance Index
The Challenge of Energy
• Limited access to energy is one of the greatest
challenges to achieve the MDGs in Africa.
• African firms lose 5% of their sales due to frequent
power outages, a figure that rises to 20% for
informal firms unable to afford backup generation.
• Overall, the economic costs of power shortage are
1 to 2% of GDP (World Bank, 2010).
• Investments in clean energy remain minor in
Africa, totalling $0.9 billion in 2009 (SEFI, 2010).
Green Jobs through Clean Energy
• About 2.3 million jobs in renewable energies in comparison to 2
million employed in oil & gas refining industry in 1999.
• Globally, investing US$630 bn in the renewable energy sector
by 2030 would create 20 million additional jobs.
Harnessing Africa’s Clean Energy Potential
Source: REN21, Figures from Renewable Energy Potentials 2008
Enabling Just Transitions
Pricing Instruments
Sustainable Public
Procurement
Favoring
Green over Brown
• Incentivize green
Draw lessons
Describe major
policies
• Create and
• Government
• From enabling
• Governments
• Private
investors
• businesses
policies and
infrastructure
conditions
can encourage
identified in
sector chapters private sector to
invest in
environmentally
sustainable
ventures
stimulate
markets for
green goods
and services
UNEP – GREEN ECONOMY INITIATIVE
UNEP – GREEN ECONOMY INITIATIVE
investments and
correct negative
externalities
Capacity Building
• “Enable the
enablers" in
developing
countries
Measuring Progress: Green Economy Indicators
A set of indicators capturing different aspects of a green economic transition
Supplyin
Investment
green sectors
Demand
Well-being…
1. Investment, employment,
and output in key sectors
of the green economy
2. Decoupling economic
growth from impacts on
the environment
Green Economy
UNEP – Green Economy Initiative
3. Aggregate indicators of
economic progress and
well being, including
poverty alleviation and
natural capital
depreciation
Supporting National Initiatives:
Green Economy Advisory Services
Current Active Engagement
2010 – 2012 rollout countries
• Africa: Regional project in 7 countries - Burkina Faso, Egypt,
Ghana, Kenya, Rwanda, Senegal, South Africa.
• East Asia: China, Indonesia, PNG, Philippines, Rep. Korea.
• Europe: Armenia, Azerbaijan, Moldova, Ukraine.
• Latin America and Caribbean: Barbados, Brazil, Dominica,
Mexico – regional initiative in the Caribbean.
• West Asia: Jordan, League of Arab States.
Deliverables:
• Green Economy Scoping Studies
• Green Sector Studies
• Green Jobs
• Enabling policies
• Multistakeholer engagement
More Information
UNEP Green Economy Website
http://www.unep.org/greeneconomy/