Towards a green economy

countries are the most vulnerable to climate change impacts. As many of the effects of climate change depend on the degree of adaptation, which itself will be determined by income levels and market structure, these countries have fewer resources to adapt socially, technologically and financially. It is estimated in Stern’s Review of the Economics of Climate Change (2006) that climate change will impose an overall cost equivalent to 0.5 to 1 per cent of world GDP per annum by the middle of the century if no emission mitigation measures are taken in the short- and medium-term. Further, the report indicates that if we start to take strong action now to achieve a stabilisation between 710ppm and 445ppm CO2

-eq by 2050, the global

average macro-economic costs for GHG mitigation are between negative 1 per cent and positive 5.5 per cent of global GDP, which is equivalent to slowing average annual global GDP growth by about 0.12 per cent per year.

In the GER BAU scenario, the feedback effects from natural resource depletion are sufficiently important that the annual rate of world GDP growth gradually

2011 Unit

Additional investment Real GDP

GDP per capita

* Annual GDP per capita^

Consumption per capita

Population below $2/ day

Total employment Energy intensity

Fossil fuel CO2 emissions

Footprint/biocapacity Continued.

Additional investment Real GDP

* Annual GDP per capita^

GDP per capita growth rate

Consumption per capita

Population below US$ 2/day

Total employment Energy intensity

Fossil fuel CO2 emissions Footprint/biocapacity

US$ bn/year US$ bn/year

US$/person/year %/year

US$/person/year %

billion people Mtoe/US$ bn Gt/year Ratio

US$ bn/year US$ bn/year

US$/person/year %/year

US$/person/year %

billion people Mtoe/US$ bn Gt/year Ratio

0

69,334 9,992

1.8% 7,691 19.5% 3.2

0.18 30.6 1.5

2011 0

69,334 9,992

1.8% 7,691 19.5% 3.2

0.18 30.6 1.5

BAU1 763

78,651 10,868

2.1% 8,366 18.1% 3.4

0.17 33.3 1.6

1,137

BAU2 1,535

79,306 10,959

2.3% 8,435 17.9% 3.4

0.17 33.6 1.6

2,334 14,577 1.6%

11,220 13.5% 4.2

0.15 43.8 1.8

falls from about 2.7 per cent per year in the period 2010-2020 to 2.2 per cent in 2020-2030 and further to 1.6 per cent in 2030-2050.

5.2 Green economy projections

Investing various additional proportions of GDP in the green economy or following BAU has various impacts throughout society, economy and the environment. Despite difficulties in estimating global impacts of investments, we were able to calculate the general repercussions on GDP and estimate employment, avoided costs and state of natural resources for most of the sectors analysed in the GER. The main impacts of simulating green and additional business-as-usual investments in various scenarios are highlighted in Table 4, Figure 10 and Figure 11.

Generally, the green economy scenarios show the beginning of the marked decoupling of natural resource uses from economic growth (see Figure 12). In fact, the key difference between green and additional BAU

2015 BAU 0

77,694 10,737

1.8% 8,264 18.3% 3.4

0.17 32.9 1.6

2030 0

13,512 1.3%

10,401 14.6% 4.1

0.15 40.8 1.8

G1 760

78,384 10,832

2.1% 8,338 18.1% 3.4

0.17 32.0 1.5

1,150

116,100 119,307 110,642 117,739 14,182

14,358 1.5%

10,916 13.9% 4.1

0.15 42.7 1.8

Table 4: Main indicators, BAU and green investment scenarios * Annual GDP per capita growth rate

1.7%

11,052 13.7% 4.1

0.13 35.6 1.6

G2 1,524

78,690 10,874

2.2% 8,370 18.1% 3.4

0.17 30.7 1.5

2,388

122,582 14,926

2.0%

11,488 13.2% 4.1

0.12 30.0 1.4

BAU1 885

91,028 12,000

1.9% 9,236 16.4% 3.7

0.16 36.6 1.7

1,616

BAU2 1,798

92,583 12,205

2.1% 9,394 16.2% 3.7

0.16 37.1 1.7

3,377 19,476 1.7%

14,991 9.8% 4.8

0.13 55.7 2.2

2020 BAU 0

88,738 11,698

1.7% 9,004 16.9% 3.6

0.17 35.6 1.6

2050 0

17,068 1.4%

13,138 11.4% 4.6

0.13 49.7 2.1

G1 883

90,915 11,983

2.0% 9,224 16.5% 3.7

0.16 33.2 1.6

1,719

164,484 172,049 151,322 174,890 18,594

19,626 1.6%

14,312 10.4% 4.7

0.13 53.7 2.2

1.5%

15,106 9.8% 4.8

0.08 29.9 1.4

G2 1,789

92,244 12,156

2.2% 9,357 16% 3.7

0.21 30.3 1.4

3,889

199,141 22,193

2.2%

17,082 8.4% 4.9

0.07 20.0 1.2

518