The right kind of green growth

Green growth indicators 2014It’s the kind of scene travel agents love. A quiet beach where the only sound is the lapping of the waves. Then, the beat of a horse’s hooves, slowly becoming louder. A rider gallops into view, reining in his mount. But then, the horse drops dead and the rider is saved by chance because a worker sees him and manages to drag him to safety in time. The killer is a thick green slime bubbling on the sands. We’re not in some 1950s sci-fi movie. This really happened in Brittany, France, in August 2009.

The horseman, Vincent Petit, is a vet, and he had a toxicology lab carry out some tests. The cause of the horse’s death was probably intoxication by hydrogen sulphide escaping from rotting algae. When these plants wash up on land, a white crust forms and traps the gases. The putrefying algae eventually turn the sand into black sludge, sometimes over a metre deep, containing pockets of poison gas. Vincent Petit’s horse broke the crust trapping these gases.

An official report confirmed the part played by the poisonous gases, and says that the solution is to collect the algae. Some Breton towns spend over 100,000 euros a year clearing away the slime. For environmental groups, the problem should be eliminated, not managed. They argue that the upsurge in recent years is due to nutrients washed off farms into rivers and then into the sea, causing the algae to proliferate.

In any case, that’s not what the OECD means when it says it wants to encourage green growth. Writing in OECD Green Growth Indicators 2014, Rintaro Tamaki, the Organisation’s Deputy Secretary-General, explains that it is about “fostering economic growth and development while ensuring that natural assets continue to provide the resources and environmental services on which well-being relies.” So how are we doing?

It’s a mixed picture. Global CO2 emissions are growing, but OECD countries are “decoupling” emissions from growth, meaning either that emissions are actually declining (absolute decoupling) in a third of the countries, or that GDP is growing at a faster rate than emissions (relative decoupling). OECD countries don’t do so well if you look at final demand though. Some of the reductions are due importing goods with a high carbon footprint rather than making them in the country.

Energy productivity is improving too (the amount of energy needed to produce a given unit of output), but a person living in an OECD economy still uses 78% more energy on average than someone in an emerging economy. Moreover, 80% of our energy still comes from fossil fuels and low-carbon energy technologies haven’t progressed much – an average unit of energy produced today pollutes just as much as 20 years ago. And OECD countries are still subsidising fossil fuels to the tune of $50-90 billion a year, with developing countries giving half a trillion more. Air pollution now kills twice as many people as HIV/AIDS according to an OECD report, The Cost of Air Pollution: Health Impacts of Road Transport.

Global resource extraction is rising, and a lot of these resources are thrown away. In OECD countries each person generates over half a tonne (530 kg) of municipal waste a year on average, which is 30 kg less than in 2000 but 30 kg more than in 1990.

The overall pressure on natural resources remains high and Green Growth Indicators reveals a series of worrying trends. “Biodiversity rich areas are declining and many ecosystems are being degraded. Many animal and plant species are endangered; one third of the world’s fish stocks are overexploited, and many forests are threatened by degradation, fragmentation and conversion to other land types. Pressures on water resources remain high; in some cases local water scarcity may constrain economic activity.”

There are some glimmers of hope. Environmental goods and services are becoming more important for the economy and government policies are starting to support a transition to green growth, for example through environmental taxes or reducing subsidies to environmentally harmful farming activities. International finance is starting to explore the potential of green growth through green bonds, while export credit agencies are facilitating private investment in projects that undergo an environmental impact assessment.

Overall though, the impression I got from reading the report was, to misquote a favourite OECD conclusion, that not much has been done and much remains to be done. On the other hand, last July a French court did say the state was to blame for the green algae since it wasn’t diligent enough in applying national and European norms on agricultural runoff. It awarded Vincent Petit 2000 euros for his horse and about the same for his lawyer, although they did say it was his own fault for going near that beach in the first place.

Useful links

As part of its Green Growth Strategy, the OECD is developing a set of indicators for agriculture. A Preliminary Assessment has just been published, and a selection of indicators has been identified to capture key aspects of a low-carbon, resource-efficient agricultural sector. You can read the report below.

Patrick Love

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