A GLOBAL PERSPECTIVE ON THE STATE OF THE BIOECONOMY AND

KEY EMERGING ISSUES – A CONCEPT IN THE MAKING

Sten Nilsson

Ottawa, June 3, 2013

INTERACTING MEGATRENDS

Source: Bertelsmann Stiftung, 2012.

THIS IS WHAT IT IS ALL ABOUT

Source: Google Earth Engine and Earth Outreach, 2013

WHAT IS BIOECONOMY (GREEN ECONOMY) – 1

It is about achieving:• Social sustainability: a long-term, stable,

dynamic society of equality• Economic sustainability: sustainable

management of human and material resources• Ecological sustainability: safe guarding the

environmental capacities and human healthBioeconomy is the toolbox to achieve the sustainability vision

WHAT IS BIOECONOMY (GREEN ECONOMY) – 2

• Bioeconomy is about political reorientation and fundamentally changed strategic thinking

• Bioeconomy is about integrated policy making• Bioeconomy is about a shift in thinking

concerning growth and development, production of goods and services, and consumer habits

WHAT BIOECONOMY (GREEN ECONOMY) IS NOT

• Additions of ‘bio’ or ‘green’ to the conventional economy

• ‘Bio’ or ‘green’ are not always sustainable• Bioeconomy is not version 8.0 of the ‘Greed

Economy’ or version 4.0 of ‘Business as Usual’or version 2.0 of ‘Governance as Usual’

• Bioeconomy is not a new concept. First mootedin 1989, by David Pearce, Anil Markandya and Ed Barbier in “Blueprint for Sustainable Economy”.

• The term ‘bioeconomy’ was coined at an AAAS meeting in early 1990s

EXAMPLE OF DEFINITIONS OF BIO-ECONOMY (GREEN ECONOMY) – TAKE

YOUR PICK

• “Economic activities related to the development and commercialization of products and processes – in whole or in part – using renewable biological sources from agriculture, forestry, and marine” (Farm Credit Canada, 2012)

• “The bioeconomy includes all industries and economic sectors that produce, manage, or otherwise make use of biological resources including bio-waste” (The Coordinator of Knowledge-Based Bioeconomy, EU, 2012)

• “One economy with selective application of bio-genetic raw materials and advanced biological and biotechnological processes” (The German Bioeconomy Council, 2012)

THE SPACE OF BIOECONOMY

Source: European Environment Agency, Green economy, 29 June 2012 (http://www.eea.europa.eu/themes/economy/intro)

POSITIONING BY INTERNATIONAL ORGANIZATIONS

• The OECD (2010) “is mainstreaming green growth in its policy exercises and policy advices that is targeted to the needs of individual countries”

• UNEP, building on its Green Economy Report, gives policy advice, technical assistance, and capacity building to governments in establishing green economy (e.g. Nepal, Jordan, Indonesia, China, South Africa, Mexico, Brazil)

• UNIDO is developing an extensive program on Green Industry to decouple resource use and pollution from industrial development

• The World Bank, UNEP, OECD and Global Green Growth Institute (2012) have established a Global Green Growth Knowledge Platform with the task to identify and address major knowledge gaps in green growth theory and practice

POSITIONING OF CIVIL SOCIETIES

• Civil society divided over the concept of bioeconomy• Latin American countries and some G-77 members are

in fierce opposition to the concept (“the developed countries will hijack the bioeconomy”)

• International NGOs are showing both ambivalence and enthusiasm; some call it green-washing of the global economy; others have started campaigns devoted to the development of bioeconomy

• The number of dialogues is increasing in developing countries with the civil society on the bioeconomy concept

POSITIONING BY GOVERNMENTS – 1 • Ireland (2008) – Food production and processing, agri -

environmental products and services, and energy and bio-processing

• Sweden (2012) – Research and innovation strategy for a bio-based economy – replacement of fossil fuels, smarter products and smarter use of raw materials, change in consumption habits

• Norway (2012) – Research Program 2012-2122 –sustainable innovation in food and bio-based industries

• The Netherlands (2012) – Bioeconomy Strategy –Integrated concept, the complete value chain of biomass, opportunities for agriculture

• Germany (2011) – National Research Strategy Bioeconomy 2030 – utilization of renewable raw materials

POSITIONING BY GOVERNMENTS – 2

• Finland – working on a Bioeconomy Strategy and has done much work on bioeconomy and the forest sector

• Denmark – has allocated substantial funds for green growth in the agriculture sector

• Malaysia (2012) – Bioeconomy Transformation Program –biotechnology, agriculture, forestry, fisheries, food production, health care, chemicals and renewable energy

• United States (2012) – National Bioeconomy Blueprint –support R&D investments providing foundations for the future US bioeconomy, facilitate the transition of bio-innovations from lab to markets, reform regulations to reduce barriers, training programs, public/private partnerships

POSITIONING BY GOVERNMENTS – 3 • South Africa (2012) – The Bioeconomy Grand Challenge –

research, development and innovation program• Russia (2012) – Coordinated Program of Biotechnology –

to initiate the bioeconomy development, to establish new businesses with biotechnology, provide regional bio-clusters and biorefineries, platform chemicals, bioplastics, biomaterials, pulp & paper, foods and feeds

• South Korea (2008) – National Strategy for Green Growth –“become a world leader in the emerging green global market for goods and services” – promote strategic R&D and commercialization of new renewable energy technologies, create new markets for NREs, facilitate export industry, provide infrastructure for development of NRE technologies, public procurement, reform regulations incentives and taxes, development of new industrial strategy

POSITIONING BY GOVERNMENTS – 4 • China (2011) – in the 12th 5-year plan: priorities on green

technologies, renewable energies, establishment of new green economy (green industry, green cities, green buildings)

• UAE (2012) – The Green Economy Initiative – to make UAE one of the global pioneers in bioeconomy, a hub for export and re-export of green products and technologies, and protecting a sustainable environment that supports long-term economic growth including green cities and buildings, environmentally friendly transportation, reduction of emissions, promotion of organic agriculture, maintaining bio-diversity, new regulations of use of water, energy, other natural resources and recycling

• The Arab Green Economy Initiative – transforming the existing economy to bioeconomy across the Arab region (The Arab Forum for Environment and Development)

POSITIONING BY GOVERNMENTS – 5

• European Union (2012) – Bioeconomy Strategy –“Innovation for sustainable growth: a bioeconomy for Europe”. The strategy addresses inter-connected societal changes such as food security, natural resource scarcity, fossil resource dependence and climate change, while achieving sustainable economic growth.The Bioeconomy Action Plan:- Increased investments in research, innovation and skills- Reinforced policy interaction and stakeholder engagement- Enhancements of markets and competitiveness in

bioeconomy

THE EU POLICY INTERACTION MODEL FOR THE BIOECONOMY

Source: Maive Rute, European Commission, 2012.

THE EU ENHANCEMENT OF MARKETS AND COMPETITIVENESS IN

BIOECONOMY SECTORS

• Provide knowledge-base for sustainable intensification of primary production; improve understanding of biomass/ biowaste availability and demand

• Promote the setting up of networks for integrated and diversified biorefineries; establish a PPP for bio-based industries

• Support expansion of new markets; facilitate green procurement for bio-based products

• Develop science-based approaches to inform consumers about product properties

Source: Maive Rute, European Commission, 2012.

POSITIONING OF GLOBAL INDUSTRY AND BUSINESSES

• On the surface, global industry and businesses appear to embrace the bioeconomy agenda

• International Chamber of Commerce (2012) – identify 10 conditions towards a green economy; among those are:- social, environment and economic innovations- collaboration between all sectors of society, business and

government- integrated governance- balancing of short- and long-term strategies- multilaterism

• Private sector investments in bioresearch are increasing: e.g., the automobile industry, semiconductor industry, electronic industry, etc.

MULTI-SECTOR BIOECONOMY APPROACHES

• The chemical vision 2030 in Sweden’s Gothenburg region – the chemical companies AGA, Akzo Nobel, Borealis, INEOS, Perstorp –working on bio-based chemicals and materials in cooperation with forest, food, energy, agriculture, automobile, refinery, water, recycling industries

• The Green Economy Cluster in New Jersey – green energy production, green building construction, waste management

• EU – “The European bioeconomy in 2030”, ten technology platforms (plants, food, feed, chemistry, animal breeding, biofuels, forest sector, biofuels, agriculture, aquaculture, animal health) set common themes and joint priorities for establishment of bioeconomy

• EU – “Biorefinery Vision 2030”, five technological platforms (plants, agriculture, forest sector, chemistry, biofuels) set a common biorefinery vision with concrete steps

EXAMPLES OF THREATS TO THE BIOECONOMY CONCEPT

• The global economic development• Shifts in global economic power• The lack of reforms of the financial system• Finance, funding and access to capital is crucial• Costs for the required infrastructures• Entrenched interests• Entrenched governmental silos• Fracking of shalegas• “Can we really afford this?”

SUMMARY OF THE GLOBAL OVERVIEW• The bioeconomy and green growth agendas are

moving rapidly• There is still a significant lack of clarity, even

among those most involved, about what the bioeconomy really is

• Most of the bioeconomy programs established so far are only partial bioeconomy concepts

• Most of the programs use research and innovation to facilitate a transition to the bioeconomy

• The principal challenge is HOW to move to respectively implement a bioeconomy

• The need for multi stakeholder collaboration is acute to define and better understand the bioeconomy concept

THE REAL GAME OF TRANSFORMING TO BIOECONOMY

Source: World Economic Forum – Industry Agenda, January, 2012.

OVERARCHING ISSUE FOR THE WAY FORWARD FOR THE BIOECONOMY

• Political, societal, and business/market conditions setting constraints, respectively promoting a bioeconomy agenda have to be framed

• These factors constitute the framework for the bioeconomy agenda

• Achieving a transition to the bioeconomy will only be possible through a collective vision, creativity, action from a broad cross-section of the civil society, governments, business/industry and consumers

FRAMING OF THE BIOECONOMY AGENDA

Political and societal conditions

Market conditions for

sustainable business

opportunities R&D and innovation

Product development

THE OVERARCHING ACTION PLAN

Identify and demonstrate how sectors can contribute to the transition to bioeconomy

Identify required: - new political orientation

- new strategic thinking

- new integrated policies

- new institutional arrangements

Communication to policy makers in order to create a common vision, new goals, and new routings

THE BIOECONOMY 1

• Bioeconomy is about POLITICS, changing POLITICAL ECONOMY of how big decisions are made

• Bioeconomy is about QUALITY• Bioeconomy has MANY ‘R’s:

Reduce, Reuse, Recycle, Replace, Redesign, Rebuild, Redefine, Revive, Regenerate, Reform, Reorganize, Reimagine, and be Resilient

ROADMAPS

Identify promising value chains for trans-

formation to bioeconomy

For each value chain, identify

the actions required to make

bioeconomy happen

Identify the distribution of

the roles among stakeholders of the value chains

for the imple-mentation of bioeconomy

• Bioeconomy is the transition of the TOTAL ECONOMY and not just a subset of the economy

• Bioeconomy is a FUNDAMENTAL CHANGE in production and consumption

• Bioeconomy is to FIND NEW WAYS to create products and services more efficiently

• Bioeconomy is a TECHNOLOGY-RICH, INNOVATION-DRIVEN and SERVICE-FOCUSED economy

THE BIOECONOMY 2

GREAT CANADIAN OPPORTUNITIES WITH BIOECONOMY

• Vast biomass resources• Big customers of bio-products – chemistry,

energy, construction, packaging, automobile, aircraft, etc. industries

• Will create new values to conventional commodity industry

• Canada has outstanding experience of being a game-changer – see comparison of Canada’s role in establishing the sustainability concept

• It is just a question of political will

Thank you for your attention!

Sten B. NilssonCEO, Forest Sector Insights ABTT Banan 12, S-77 693 Hedemora, Sweden

Phone and Fax: +46 225 381 02 Cell: +46 70 381 02 14; Skype: stenbnilsson

Email: stenbnilsson @gmail.com

Sten Nilsson