Post on 01-Apr-2015
Marianne Fay, The World Bank, June 2012
INCLUSIVE GREENGROWTHThe Pathway to Sustainable Development
2
Sustainable development requires greener growth
3
Continued and more inclusive growth is needed
• GDP per capita still very low in developing countries: 1990: $1,200
2010: $2,300
2030: $4,700*
• 918 million people still expected to live in poverty by 2015
*: in $2010, using WB growth projections1990 2005 2015
0
5
10
15
20
25
30
35
40
45
Poverty rate (%)
-445 million people
-453 million people
4Source: Rockström et al., Nature (2009)
??
But growth has come at a heavy environmental price
5
Green growth is…
…economic growth that is environmentally
sustainable.
Not a new paradigm, but aims to operationalize sustainable
development by enabling developing countries to achieve
robust growth without locking themselves into unsustainable
patterns.
Not inherently inclusive, hence the need for specific policies to
ensure the poor benefit.
6
CAN WE GREEN GROWTH WITHOUT NECESSARILY SLOWING IT?
Is it possible?
7
Exploit the inefficiencies!
8
Y = f (A, K, L, E)Y = f (A, K, L)
Manage the environment as “natural capital”
9
• Loess plateau- before• Loess plateau- after
Manage the environment as “natural capital”
10
Seize opportunities before they are gone…
11
INCLUSIVE GROWTH THAT IS EFFICIENT, CLEAN, AND RESILIENT
And how to measure progress?
12
Challenges
• Cultural: moving beyond GDP
• Theoretical: capturing sustainability in a single indicator
• Policy: designing indicators that are useful
• Practical: data, data, data…
economic growthGDP p.c.
economic growth• GDP p.c.
poverty eradication• no of people below $1.25 poverty
line
shared prosperity• income growth of the bottom
40%+
inclusiveness
economic growth• GDP p.c.
poverty eradication• no of people below $1.25 poverty line
shared prosperity• income growth of the bottom 40%+
inclusiveness
Change in wealth• change in wealth in $ p.c
financial capital physical capital human capital natural capital
• gross savings • manufactured capital• infrastructure
• health• education
• climate• air• land • water
sustainability
Gross Saving Net Saving Net Saving plus Ed-ucational Expedi-
tures
Depletion-Adjusted Saving
Change in Wealth-250
-200
-150
-100
-50
0
50
100
150
200
250
USD
per
cap
ita
minusdepreciation
of fixed capital
pluseducational expenditures
minusdepletion of
natural resources
minus population
growthAdjustment /*
Note: /* how much additional savings are needed to keep per capita wealth levels constant = population growth rate x total wealth per capita
Data for Cameroon, 2008
Calculating Change in Wealth per capita
Source: World Bank calculations based on World Bank data, 2013.
0 2000 4000 6000 8000 10000 12000 14000 16000
-3,000
-2,500
-2,000
-1,500
-1,000
-500
0
500
1,000
1,500
2,000
Angola
BelarusChina
Grenada
Kazakhstan
Lithuania
Romania
Russia
Seychelles
St. Kitts and Nevis
St. Lucia
GNI per capita (US$)
Popu
latio
n-A
djus
ted
Chan
ge in
wea
lth
per
capi
ta
economic growth• GDP p.c.
poverty eradication• no of people below $1.25 poverty line
shared prosperity• income growth of the bottom 40%+
resource efficiency• energy intensity• water productivity• green multi-factor productivity
inclusiveness
genuine savings• change in wealth p.c
financial capital physical capital human capital natural capital
• gross savings • manufactured capital• infrastructure
• health• education
• climate• air• land • water
sustainability
economic growth• GDP p.c.
poverty eradication• no of people below $1.25 poverty line
shared prosperity• income growth of the bottom 40%+
resource efficiency• energy intensity• water productivity• green multi-factor productivity
economic resilience• risk (hazard x exposure x sensitivity)• response (recovery, transformability)
inclusiveness
genuine savings• change in wealth p.c
financial capital physical capital human capital natural capital
• gross savings • manufactured capital• infrastructure
• health• education
• climate• air• land • water
sustainability
economic growth• GDP p.c.
poverty eradication• no of people below $1.25 poverty line
shared prosperity• income growth of the bottom 40%+
green policies and business environment• environmental regulation• environmental taxes and spending
• environmental markets and green investments• innovation
resource efficiency• energy intensity• water productivity• green multi-factor productivity
economic resilience• risk (hazard x exposure x sensitivity)• response (recovery, transformability)
inclusiveness
genuine savings• change in wealth p.c
financial capital physical capital human capital natural capital
• gross savings • manufactured capital• infrastructure
• health• education
• climate• air• land • water
enabling conditions
sustainability