Resource Efficiency: Potential and Economic Implications. Smarter use of natural resources can inject $2 trillion into global economy by 2015
Smarter use of natural resources can inject $2 trillion into global economy by 2015.
The United Nations has found that smarter and more efficient use of the world’s natural resources today can yield an “environmental win-win’ by injecting $2 trillion into the global economy by 2050 while also offsetting the costs of ambitious climate change action.
Citing new research from the International Resource Panel in a news release, Erik Solheim, Head the UN Environment Programme (UNEP), called it “an environmental win-win.”
The report, “Resource Efficiency: Potential and Economic Implications,” which was commissioned in 2015 and released in Berlin at the G20 meeting, found that while investment in ambitious climate action would cause a 3.7 per cent fall in per capita gross world product by 2050, more sustainable use of materials and energy would not only cover the cost of keeping global warming below 2 degrees Celsius, but also add an extra $2 trillion to the global economy by 2050.
“By making better use of our planet's natural gifts, we will inject more money into the economy to create jobs and improve livelihoods,” Mr. Solheim stressed. “At the same time we will create the necessary funds to finance ambitious climate action,” he added.
The report analyzed four paths that countries could take over the next three decades, ranging from ‘business as usual’ to a scenario where they adopt both ambitious climate policies and improve resource efficiency.
For example, between 2005 and 2010, a programme in the United Kingdom recycled or reused seven million tonnes of trash destined for the landfill. This move saved six million tonnes of carbon dioxide emissions, close to 10 million tonnes of virgin materials and 10 million tonnes of water. It also increased business sales by £176 million, reduced business costs by £156 million and created 8,700 jobs.
Although other key findings point to uneven economic gains of resource efficiency and slower resource extractions, which would reduce revenues and affect jobs in some industries – such as mining and quarrying – countries still stand to gain more by implementing compensation and transfer policies to ease the transition to more efficient practices, than by continuing to support inefficient activities, according to the report.
In addition to economic benefits, the analysis illustrates that resource efficiency and climate action would reduce global resource use by around 28 per cent in 2050 compared to current trends.
For G7 countries, resource efficiency, coupled with ambitious climate action, would increase Gross Domestic Product by $600 billion in 2050 ($600 per person, or 1 per cent).
The International Resource Panel is a group of experts in natural resource management hosted by UN Environment.
Other key findings:
- Increased resource efficiency is practically attainable.
- There are substantial areas of opportunity for greater resource efficiency.
- Resource efficiency can contribute to economic growth and job creation.
- Improving resource efficiency is indispensable for meeting the costs of climate change targets.
Read the full text report “Resource Efficiency: Potential and Economic Implications”
The Principles provide guidance for financiers and investors to analyse, monitor and disclose the social, environmental and economic impacts of the financial products and services they deliver.
“With global challenges such as climate change, population growth and resource scarcity accelerating, there is an increased urgency for the finance sector both to adapt and to help bring about the necessary changes in our economic and business models,” said Deputy Chief Executive Officer of Société Générale, Séverin Cabannes.
“The Principles for Positive Impact Finance provide an ambitious yet practical framework by which we can take the broader angle view we need to meet the deeply complex and interconnected challenges of our time,” he added.
The Principles were developed by the Positive Impact Working Group, a group of UN Environment Finance Initiative banking and investment members, as part of the implementation of the roadmap outlined in the Positive Impact Manifesto released in October 2015.
Currently, the Positive Impact Working Group includes: Australian Ethical, Banco Itaú, BNP Paribas, BMCE Bank of Africa, Caisse des Dépôts Group, Desjardins Group, First Rand, Hermes Investment Management, ING, Mirova, NedBank, Pax World, Piraeus Bank, SEB, Société Générale, Standard Bank, Triodos Bank, Westpac and YES Bank
Financing sustainable development, as one of the greatest challenges at the moment, requires ambition, innovation, and commitment, underpinned by effective collaboration.
“UN Environment is honoured to partner with Ant Financial in making green finance an integral part of the daily life of every individual and business,”
“Ant Financial is a strong believer in green finance. Several of our products and services have been contributing to sustainable development,” said Eric Jing, Chief Executive Officer of Ant Financial.
One such innovation is Ant Financial’s app, which provides users with a carbon account, in addition to their credit and saving accounts. Ant’s 450 million users in China are now able to benchmark their carbon footprint and to earn “green energy” credits for reducing their footprint.
Moreover, Ant Financial has integrated this function into a social media experience, as well as committing to a complementary, tree-planting carbon offset programme. As of today, 72 million users are participating in the app.