This post is from Serge Tomasi, Deputy Director of the OECD Development Co-operation Directorate
Over the past 20 years, the global development landscape has changed dramatically. At the same time, we face unprecedented global challenges and growing instability, with looming financial and economic crises, and growing unemployment, food insecurity, political instability and environmental threats.
In my view, the latter is probably the biggest of our challenges, as it is long term and will have a severe impact on developing countries for several reasons. Environmental degradation is already very costly in developing countries, where the share of national wealth that is embedded in natural assets is much higher than in developed economies. In these countries, already vulnerable groups of people, such as the rural poor, are highly dependant on natural resources. Without policy shifts to limit climate change and address other environmental risks, the pace of rising temperatures and growing water shortages will lead to alarming impacts concentrated in developing countries.
This includes food security problems in poor countries, where a dramatic increase in demand for food is expected by 2050 (by 50-70% in developing countries as a whole and by 100% in LICs). This combined with growing food price volatility could exacerbate already existing food security risks. Energy access and energy security are also pressing challenges for many countries, in particular in sub-Saharan Africa, where more than two-thirds of the population has no access to electricity today. Last but not least, demographic trends – such as rapid urbanisation – point to a need for dramatic increases in investment in new infrastructure. Without policy changes, infrastructure investments run the risk of being locked-in to outdated, polluting transportation and other systems, with large, negative impacts on human health and well-being in developing countries.
On the other hand, the success story of economic growth in a large set of developing countries – mainly in Asia and Latin America – is very impressive. We have learned from this experience that strong economic growth over the long term is critical is we want to dramatically reduce absolute poverty. But we have to learn also from the negative side of these experiences, including the challenges these emerging countries are now facing now with regard to environmental and sustainability.
Over the past few years, the OECD has been promoting a new growth model – a more sustainable and inclusive one. In 2011, an OECD ministerial meeting endorsed the OECD Green Growth Strategy, aiming to boost economic growth while preserving the natural assets on which our well being depends.
Today OECD has launched a new report – Putting Green Growth at the Heart of Development. It puts our expertise in green growth – and the experience of numerous developing countries – at the service of developing country policy makers who are committed to designing and implementing green growth strategies and policies. It recognises that economic growth is a key part of any national poverty reduction strategy, but also shows that environmental protection is a strategic asset in contributing to national wealth and the well-being of current and future generations. it poses the challenge of reconciling economic growth and environmental protection, and gives examples of how this can be effectively done. In short, it makes the case for promoting sustainable growth as a critical element of sustainable development.
As OECD Secretary General Angel Gurria said: “We are working to ensure that sustainable development and inclusive, green growth remain centre- stage in everything we do. We cannot afford to do otherwise.”
Putting Green Growth at the Heart of Development was prepared through intensive joint work with developing countries – mainly low-income countries – and with a wide group of development co-operation partners. It reviews nearly 80 policies and initiatives from 37 developing countries as well as regional green-growth initiatives.
The many examples described in the report present a clear and hopeful message: green growth can generate both wealth and well-being for citizens of current and future generations. The report also examines the trade-offs between short-term demands and longer-term impacts, and the need to make choices that will deliver a more stable and sustainable future while also ensuring immediate gains.
Beyond the national policy agenda, international cooperation can provide essential support to developing countries in managing a transition to green growth. Financing green infrastructure, strengthening access to international markets, boosting trade in green products and services, and promoting technological transfer and cooperation are key.