Towards a green economy Key messages 1. A Green Economy grows faster than a brown economy over time, while maintaining and
restoring natural capital. Quantitative modelling for the Green Economy Report demonstrates that greening can not only generate increases in natural capital, but also produce a higher rate of Gross Domestic Product (GDP) growth – a classical, if outdated, measure of economic performance. Gross Domestic Product in the green scenario is projected to overtake business-as-usual (BAU) within ten years. An adjusted measure of net domestic product, accounting for both physical capital depreciation and also for natural capital depletion, achieves this result even earlier, indicating that a green economy offers improved and integrated capital management.
2. Business-as-usual can only deliver development gains at an unaffordable price. Under a BAU scenario, which replicates historical trends and assumes no fundamental changes in policy or external conditions to alter the trends, development benefits in terms of GDP growth and poverty reduction may continue for some time. But, these development gains would be achieved at an unaffordable price. Business-as-usual continues on the current high carbon intensity development path, with its associated environmental impacts, especially in terms of the long-term concentration of atmospheric greenhouse gases (GHG), which would approximate 1,000 ppm CO2
-eq by 2100,
resulting in temperature increases most likely around 4 degrees centigrade (as per IPCC scenarios A1B and A2). In addition, BAU would also significantly draw down natural capital assets; the results indicate that the global ecological footprint would be more than two times the available bio- capacity of the earth.
3. A green economy promotes pro-poor growth and achieves energy and resource efficiency. A green economy strengthens pro-poor economic growth through building up natural capital, on which the livelihood of the poor depends. In a green investment scenario, 2 per cent of global GDP is allocated to greening the energy, manufacturing, transport, buildings, waste, agriculture, fisheries, water and forests sectors. In the simulations, these investments help to, by 2050, potentially double fish stocks, and increase forestland by one-fifth, as compared to BAU. They would also reduce use of fossil fuels by 40 per cent, and demand for water by about 20 per cent, relative to BAU. By maintaining and building up natural capital and mitigating resource scarcity, these investments would provide the basis for enhanced human well-being, and sustained economic growth over the next 20 to 40 years, at least as strong as BAU with considerably reduced downside risks.