Reservations about the Green economy

The «Agenda 21» developmental and environmental action programme agreed at the 1992 Rio Earth Summit is still regarded as a milestone on the path to sustainable development. In it the industrialized countries acknowledged that they bore greater responsibility than developing countries for protecting the environment, as they were putting a much greater strain on natural resources and the environment. Besides, rich countries promised the South additional funding as well as technological support for environmentally friendly, fair and decent – i.e. sustainable – development. Rio had debunked the idea – at least on paper – that developing countries would first have to grow economically before being able to protect the environment and distribute wealth more fairly.

Paper is patient

The paradigm shift agreed at the highest policy level – from unsustainable economic growth to sustainable development – is yet to materialize. The implementation of Agenda 21 has failed. Humankind is still destroying the planet at an increasing pace. Income and wealth are anything but fairly distributed. The theory that sufficient economic growth will mean greater well-being for all, in the same way that all boats are lifted higher in a flood, has not materialized in practice. The opposite is the case. In its Rio+20 input for example, Third World Network (TWN) points out that global per capita income has indeed doubled, but that 20 per cent of the world’s population receive over 70 per cent of global income, as against a mere 2 per cent for the poorest fifth (1).  What has gone wrong and how can we fix it? This is what developing countries would like to clarify next year in Rio.

Flight forward

Had the industrialized countries taken the implementation of Agenda 21 seriously, it would have meant fundamental changes to their international policies. No longer would they be able, via the WTO, to call for the elimination of subsidies to promote environmentally friendly industries in developing countries while at the same time subsidizing their own agriculture. As part of the technology transfer agreed on, they would have had to issue licences allowing for the reproduction of high-tech products at reasonable prices. Had they been serious about sustainable development, not only would they ultimately have had to change their «production and consumption patterns», as is euphemistically stated in many UN texts, but also to share the remaining resources and consume less raw materials.

The industrialized countries are attempting to use a new formula – the «green economy» – to paper over the obvious contradiction between the verbally postulated sustainable development and the fetish of real economic growth that is still being cultivated. «Green economy» is the new magic word that will promote worldwide environmental protection and justice without sacrificing growth.

That sounds wonderful. At first glance a «green economy» is an environmentally friendly economy that conserves natural resources and minimizes pollution and harmful emissions. However, closer inspection shows that there is some debate as to whether the «green economy» is expected to preserve the environment or rather to drive economic growth. Even in the UN discussions preliminary to «Rio+20» no consensus has been reached so far on what exactly a «green economy» is – and what it ought not to be.

Scepticism in the South

The «green economy» concept itself already leaves out an important dimension of sustainable development, that of justice. Developing countries are insisting on this, however. Their view is that Rio+20 should focus less on the controversial «green economy» concept and more on how the developed countries can finally fulfil their historic responsibility, albeit 20 years late, and end their policy of double standards.

The developing countries have some weighty reservations about the «green economy». They are fearful that the North could use a sham package to try to secure new markets for its own environmental technologies – not least of all in order to regain control over the economic effects of the financial crisis. Martin Khor, Head of the Geneva-based South Centre which advises developing country governments, warns that the «green economy» cannot become a justification for demanding that countries in the South should cut their import duties on eco-friendly products. Neither should the new concept be a smokescreen for new protectionism whereby the industrialized countries levy duties on products that do not meet their environmental standards (2).

The developing countries are also fearful that the «green economy» could lead to new conditionality. According to Martin Khor, the North could use it as a way of tying development cooperation or the grant of loans to environmental conditions. Protectionism and new conditionality, however, run counter to the agreement by the industrialized countries to meaningfully support the countries in the South in their pursuit of sustainable development.

The North indebted
Not only is the North gripped by a severe financial debt crisis. It has become deeply indebted to the South and the environment owing to its overuse of natural resources. Because the industrialized countries have placed and continue to place an enormous strain on natural resources for their own development and lifestyle, the developing countries have been left very little leeway for catch-up industrialization. Khor insists that equality in the use and control of natural resources must therefore be a central part of the «green economy».
Specifically, the industrialized countries will have to act quickly to drastically reduce their resource consumption and their ecological footprint. The countries of the South will have to adjust their economic development to the ecological limits of this planet. Only in that way will they be able to build their own high value-added industries and create decent jobs without risking ecological collapse. Yet to follow a sustainable development path they need the financial and technological support of the industrialized countries more than ever – in other words, what the Heads of Government had already agreed at the 1992 Earth Summit.

Nicole Werner, Alliance Sud

(1) www.uncsd2012.org
(2) Khor, Martin: Risks and uses of the Green Economy Concept in Sustainable Development, Poverty and Equity”

Published in: Alliance Sud News No. 70, Winter 2011/12