What is the Green Economy?
The green economy is an economic system that aims to create sustainable and environmentally friendly growth by using clean energy, reducing carbon emissions, conserving natural resources, and minimizing waste and pollution. It seeks to address the interconnected challenges of environmental sustainability and social well-being while maintaining economic growth.
In 2015 the global community committed to solving these challenges through the Sustainable Development Goals (SDGs) and the Paris Agreement on climate change. Several major collaborating institutions co-constructed a more systematic framework that offers transformative approaches to inclusive green economies, which facilitates the progress of the SDGs and Paris Agreement.
Five Principles of the Inclusive Green Economy (IGE)
The Wellbeing Principle: The economy enables all people to create and enjoy prosperity.
- Acknowledgement that the green economy is people-centered
- Focus on growing wealth that can support wellbeing
- Investment on sustainable natural systems, infrastructure, knowledge and education
- Offering opportunities for green and decent livelihoods, enterprises and jobs
The Justice Principle: The economy promotes equity within and between generations.
- Acknowledgement that the green economy is inclusive and non-discriminatory
- Supporting women’s empowerment, equitable distribution of opportunity and outcome, solidarity and social justice
- Taking a long-term perspective that serves the interests of future generations
The Planetary Boundaries Principle: The economy safeguards, restores and invest in nature.
- Recognition of nature’s functional values, cultural values and ecological values
- Acknowledgement of limited substitutability of natural resources
- Investment on restoring natural systems and innovating in resource management
The Efficiency and Sufficiency Principle: The economy is geared to support sustainable consumption as well as sustainable production.
- Support the economic growth without increasing resource consumption
- Recognition of ‘social floor’ of consumption that is necessary to meet humans’ needs
- Taking true costs to society into consideration and functioning through market mechanism
The Good Governance Principle: The economy is guided by integrated, accountable and resilient institutions.
- Acknowledgement that an inclusive green economy is evidence-based and interdisciplinary science
- Encouraging integrated , collaborative and coherent efforts
- Promoting devolved decision-making and a financial system that serves the interest of society
Source: “Principles, priorities and pathways for inclusive green economies: Economic transformation to deliver the SDGs” https://www.greeneconomycoalition.org/assets/reports/GEC-Reports/Principles-priorities-pathways-inclusive-green-economies-web.pdf
What’s wrong with the Green Economy?
“The idea of ‘green growth’ is flawed. We must find ways of using and wasting less energy”
First of all, the green economy ignores the complexities of the current global crises, which are causal and interconnected challenges rather than just a climate crisis. The core of the green economy is decarbonization and the central strategy is to “put a price on carbon” so that businesses have to internalize the environmental costs and reduce carbon emissions. However, decarbonization could also be achieved by phasing out nonrenewable energy, compensating for fossil emissions by storing equivalent quantities of carbon in plants or soils, or the use of carbon capture and storage technologies on an industrial scale. The second two strategies have not been successful to date, and them seem unlikely to be able to remove sufficient carbon from the atmosphere to keep the planet below 1.5 degree celsius above pre-industrial age emissions.
Moreover, decarbonization is only one dimension of a just transition to a sustainable future. The green economy only includes ecological policies implemented by governments without touching on more fundamental and structural changes in the society. It ignores human rights and social challenges, such as inequalities in distribution of wealth and power. Critics argue that the focus on promoting sustainability and reducing environmental degradation may come at the expense of social equity and human rights. The implementation of green technologies and policies can have negative impacts on peoples, particularly in marginalized communities and developing countries. For example, lithium and rare metals are needed for electric vehicles and solar power, but they are mostly minded in conflict-ridden areas and their mining exacerbates resource conflicts.
The promise of the green economy is built on faith and trust in technological innovation, which is misplaced and overly optimistic. The technology-based solutions often focus on treating the symptoms of environmental problems rather than addressing their underlying causes. For example, renewable energy technologies may reduce greenhouse gas emissions, but they do not address the root causes of climate change, which are overconsumption and unsustainable production methods. Also, technologies can reinforce existing power structures and exacerbate social and economic inequalities. Large corporations and wealthy individuals may be better positioned to take advantage of green technologies and reap the benefits, while marginalized communities may be left behind. Alternatively, innovation is not confined to technology – consumption patterns and lifestyles can also be innovated to meet the principle of simplicity and sufficiency.
Finally and most importantly, the green economy is still based on the neoliberal capitalism and follows the growth-oriented development model. Proponents of the green economy often claim that our economy is becoming more efficient, which is beneficial to improve human well-being and reduce poverty. However, the efficiency is aimed at promoting further growth and can create new forms of consumption without recognizing the ultimate growth limit. Transformative approaches require a radical and absolute reduction of energy and resource consumption, especially in developed countries. Failing to challenge the fundamental assumption that economic growth is the only pathway to reduce poverty and improve human well-being, the green economy can only disguise the flaws of current systems in the short-term.
“Green Economy.” (2018). UNEP – UN Environment Programme. January 23, 2018. http://www.unep.org/regions/asia-and-pacific/regional-initiatives/supporting-resource-efficiency/green-economy.
Partners for Inclusive Green Economy. (2019). Principles, priorities and pathways for inclusive green economies: Economic transformation to deliver the SDGs. https://www.greeneconomycoalition.org/assets/reports/GEC-Reports/Principles-priorities-pathways-inclusive-green-economies-web.pdf
Unmüßig, Barbara, Lili Fuhr, and Thomas Fatheuer. (2016). 9 theses on criticizing the Green Economy. January 07, 2016. Green Economy Coalition. https://www.greeneconomycoalition.org/news-and-resources/9-theses-criticizing-green-economy
Unmüßig, Barbara, Wolfgang Sachs, and Thomas Fatheuer. (2012). “Critique of the Green Economy.” The Green Political Foundation. https://ke.boell.org/sites/default/files/critique_of_the_green_economy.pdf