Statement by Achim Steiner at UAE-hosted Inaugural Conference on Partnership for Action on Green Economy (PAGE) Tue, Mar 4, 2014
The Partnership for Action on Green Economy, or PAGE, is a direct response to the call made in paragraph 66 of the Rio+20 Outcome document for cooperation within the UN system to assist countries in their transitions to a green economy. Dubai, 4 March 2014 - Your Highness Sheikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of UAE and Ruler of Dubai
Your Excellency Rashid Ahmed Bin Fahad, Minister of Environment and Water
Ladies and gentlemen,
On behalf of the United Nations PAGE partners, I would like to first express my deep appreciation to the Government of the United Arab Emirates - and especially to His Highness Sheikh Mohammad Bin Rashid Al Maktoum and Minister Rashid Ahmed Bin Fahad - for graciously hosting the inaugural PAGE conference; allowing countries to exchange experiences and create opportunities for a more prosperous and sustainable world.
Almost two years ago, at Rio+20, more than 190 nations gave the green light to an inclusive Green Economy in the context of sustainable development and poverty eradication.
The Partnership for Action on Green Economy, or PAGE, is a direct response to the call made in paragraph 66 of the Rio+20 Outcome document for cooperation within the UN system to assist countries in their transitions to a green economy. It is an inter-agency initiative founded by the United Nations Environment Programme (UNEP), the International Labour Organization (ILO), the United Nations Industrial Development Organization (UNIDO) and the United Nations Institute for Training and Research (UNITAR). More UN agencies continue to support this effort, and we hope to soon announce the UN Development Programme (UNDP) as a fifth partner.
By taking a country by country approach, PAGE will catalyze up to 30 national economies between now and 2020, and thus contribute to the global transition to a sustainable future for all. The Partnership has the potential to help countries improve human well-being and social equity, while significantly reducing environmental risks and ecological scarcities in line with their own national development priorities.
In this context, I would like to salute the efforts of the donor community - Finland, Norway, the Republic of Korea, Sweden and Switzerland - who collectively managed to raise well over US $11 million in support of PAGE activities at the national level.
Today, countries such as Burkina Faso, Peru, Mauritius, Mongolia, and Senegal are set to boost their economies through a shift of investment and policies towards a new generation of assets that include clean technologies and resource efficient infrastructure, green skilled labour, well-functioning ecosystems, and good governance. Such a transformation will pay significant dividends in social, environmental and economic terms.
Ladies and gentlemen,
In the wake of the global financial crisis, it has become increasingly evident that generating growth and prosperity can and must be achieved within the ecological boundaries of a resource-constrained world.
Lifting the world's 1.2 billion poorest to a life of dignity will require financing, innovation, technology transfer and capacity building, along with effective governance and mutually beneficial partnerships at all levels.
UNEP research suggests that an investment scenario of allocating 2 per cent of global GDP to greening economic sectors will produce a higher global GDP within 10 years, compared to a business-as-usual scenario.
A package of green investments - coupled with policy reforms that are aimed at making growth socially inclusive - offers economically viable options to reduce poverty and hunger, and address challenges of climate change and degradation of natural resources, while simultaneously providing new and sustainable pathways to economic development and prosperity.
The share of the poor in global GDP is marginal and is reduced with the erosion of natural capital. The share of the bottom 40 per cent of the population in global wealth remains less than 5 per cent. It is this segment of humanity which overwhelmingly lives on small farms, coastal areas and around forests, and depends on natural capital for their livelihoods, nutrition, health, employment, income, wealth creation opportunities as well as a safety net.
Degradation of natural resources creates a poverty trap, which leads to a reinforcing loop of further degradation and worsening poverty.
Natural capital is essential for sustainable economic development and accounts for a quarter of wealth created in low income countries.
Any reduction in natural capital stocks negatively affects the well-being of the poor disproportionately and leads to growing inequalities.
The dominant consumption pattern of affluent societies is a major stress on natural resources. According to a report by the International Resource Panel, total resource use grew eight-fold, from 6 billion tonnes in 1900 to 49 billion tonnes in 2000. By 2050, humanity could devour an estimated 140 billion tonnes of minerals, ores, fossil fuels and biomass per year - three times its current appetite - unless economic growth is "decoupled" from natural resources consumption.
Financing the Green Economy
Ladies and gentlemen,
The World Economic Forum estimates that an investment in infrastructure of approximately US$6 trillion annually is needed over the next 16 years to deliver a low-carbon economy. Of this, nearly US$1 trillion is over and above the business-as-usual trajectory.
Weeks ago, UNEP launched an Inquiry into policy options for guiding the global financial system to invest in the transition to a green economy.
The inquiry aims to engage, inform and guide policy makers, financial market actors and other stakeholders concerned with the health of the financial system and its potential for shaping the future economy. Ultimately, it will lay out a series of options for advancing a sustainable financial system.
While much of the world's private capital is locked up in carbon-intensive investment across the developed world, developing country investment in a low carbon future is on the rise. Clean energy investment originating from non-OECD countries soared from US $4.9 billion in 2004 to US $72.6 billion last year, peaking at US $257 billion in 2011.
Fiscal policies are of particular importance in a green economy transition and governments have a variety of fiscal instruments at their disposal: taxing fossil fuel use or emissions in different sectors, reforming energy subsidies that promote wasteful and environmentally harmful economic activity, and supporting clean technology and sustainable production with the help of fiscal incentives. .
Constructive fiscal measures can reflect environmental externalities through full cost pricing of energy and transportation services. They can also provide a significant source of new revenue:
- In the United States, for instance, it is estimated that a levy of US $25 per ton of CO2 could bring in about one percent of the country's GDP, or more than US $ 1trillion over a decade.
- In 2010, Vietnam passed its first law on environmental taxation and it is expected to generate between US $757 million and US $3 billion.
Confronted by a fiscally constrained world, fiscal policy reforms might appear to be a daunting challenge to a green economy transition. Yet, it has been observed in the past that external crises - be they fiscal, economic or environmental - may speed up policy reform.
But in order to promote green and more inclusive growth, the design of fiscal policies should consider potential social impact on low income households. Strengthening social safety nets when applying fiscal policy reforms would not only increase social and political acceptability of fiscal reforms but could also contribute to an equitable and fair transition to a green economy.
Globally, the cost of energy subsidization is high and accounts for a significant part of GDP annually. Petroleum subsidies alone, for instance, amounted to US $200 billion in 2011.
It is estimated that removing US $500 billion of fossil fuel subsidies could boost the global economy by around 0.3 per cent. In addition to the potential fiscal benefits, the removal of fossil fuel subsidies in developing and emerging economies could reduce global GHG emissions by 6 per cent in 2050.
When considering that out of the US $409 billion spent on fossil-fuel consumption subsidies in 2010, only US $35 billion, or 8 per cent, reached the poorest income quintile (the bottom 20 per cent), energy subsidies appear to perform poorly as a means of supporting the incomes of poor social groups.
Environmental taxes are an effective and, if appropriately designed, efficient tool for environmental policy. They can also be leveraged to generate private financing. Evidence shows that fiscal instruments have helped increase green investment. Carbon taxes could direct investment towards cleaner technologies and encourage energy efficiency.
The Rio+20 conference identified international trade as an engine for development, sustained economic growth and the transition to a greener economy.
Many developing countries are well positioned to gain from mainstreaming sustainability considerations in their trade-driven growth strategies, including through the export of certified commodities in the fisheries, forests or agriculture sectors, increased investments in sustainable production and supply chains, or the expansion of eco-tourism.
For example, the Bio-trade sector in Peru has grown by 20 per cent in the last five years - generating significant revenue and promoting sustainable development, while simultaneously supporting pro-poor development.
The Green Economy transition opens up new opportunities for regional and global trade. For example, the global market in low-carbon and energy efficient technologies is projected to nearly triple to US $2.2 trillion by 2020.
UNEP is working with partners to provide demand-driven policy advice, technical assistance and capacity-building to countries who wish to use international trade as an engine for a green economy transition.
Opportunities Across Developing Economies
South-South Cooperation can deliver environmental capacity building and technology support to developing countries and regions in the South that wish to make a transition to a green economy.
Drawing on shared economic, environmental and social aspirations, South-South Cooperation helps identify solutions to today's sustainable development challenges, as well as deliver new ideas and resources to advance the global transformation to an inclusive green economy.
Around the world, the Green Economy transformation is already underway:
- In Tunisia, an innovative financial mechanism has provided incentives for households to switch to solar-powered water heaters.
- In Kenya the government's attractive feed-in tariffs have encouraged key industries to become more energy efficient, while delivering energy to rural communities. Africa's largest Geothermal Power Station, Olkaria generates over 150 Megawatts (MW) into the national grid, with Kenya aiming for 1200 MW by 2018.
- In Borneo, where extractive industries and population pressures threaten the largest intact expanse of tropical forest in South-East Asia, a multi-stakeholder initiative supported by Brunei, Indonesia and Malaysia is helping conserve the island's natural capital as a key component of its development plan, while recognizing its global contribution to reducing CO2 emissions
- The United Arab Emirates' Blue Carbon Demonstration Project connects the local natural coastal ecosystem management with climate change mitigation as part of a global effort to determine the role of coastal habitats in climate change mitigation.
- In Senegal, investment in clean energy will increase the use of renewable sources for power generation by 30 per cent in the next 20 years and create between 7000 to 30,000 green jobs in the construction and renewable energy sectors.
- In Ghana, organic farming could yield a 30 per cent increase in jobs per hectare. Policies and strategies are being developed towards that end. At the same time, conservation agriculture is helping reduce land disturbance and deforestation, which would lead to emissions reduction.
- In 2012, the African Development Bank raised US $2.2 billion to address climate change, a 50 per cent increase to the previous year. More than 90 per cent of the approved projects were green. The Bank's inaugural "green bond" raised US $550 million in global investment within 24 hours.
- In 2008, British Columbia adopted a carbon tax covering all fossil fuels (including gasoline, diesel, propane, natural gas and coal. Since the tax was introduced, fossil fuel consumption per capita declined by 17.4% between the 2007-2008 base year and 2011/2012 and British Columbia now has the lowest per capita fuel use of any province in Canada. Moreover, the carbon tax was designed to be revenue neutral - revenue generated from the tax has been used to reduce income taxes and to offer tax credits to the poor. In fact, the government of British Columbia was able to provide $500 million more in income tax cuts than it collected in carbon tax to date.
Ladies and gentlemen,
Around the world, we are seeing a multiplicity of approaches and pathways to design and build greener economies.
To support such efforts, we need to remove barriers and to enable poor and vulnerable groups to participate in, contribute to and benefit from the transition.
For a credible and systematic transformation to take place, supportive policies, institutional and governance reforms and targeted investment at the local, national and global levels need to be put in place and scaled up as part of national development planning, based on national priorities.
The first ever UN Environment Assembly (UNEA) will take place in Nairobi this June as the highest level global platform for policy making feeding directly into the UN General Assembly, with a focus on the Sustainable Development Goals and the Post-2015 Development Agenda, including sustainable production and consumption.
I would like to invite you to engage with UNEA and use the platform to further action on the Green Economy.
With civil society, policy makers, government and the business sector under one roof, there is no better forum to build on the momentum created by the Dubai inaugural PAGE conference.
Once again, I thank the Government of the UAE for hosting this important event at this critical moment in time. I would also like to seize the opportunity to congratulate the UAE for its efforts to implement the UAE's Vision 2021 and the Green Growth Strategy, which it launched two years ago following the Rio+20 conference.
This first PAGE conference is a timely event and one that I hope will foster greater understanding and cooperation, expand the PAGE partnership and set a Green Economy pathway towards sustainable development and poverty alleviation.
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