Is Green Growth a Fairytale? Green Growth, Green Economy, GEP & Decoupling explained!

Green Economy 

Before we dive into Green Growth and it’s mystical reputation let’s explore the vision of a Green Economy. The aim of the Green Economy is to create a fair and inclusive economic future for all, within the planetary boundaries a.k.a. Ecological limits of planet earth. I am going to make a wild assumption and guess that I don’t need to explain why we are in need of a new economic system.

The vision for a Green Economy is built upon five key principles: 

  • The well-being principle, meaning that the green economy has to enable well being and prosperity for all people. 
  • The justice principle, meaning it’s an inclusive, non-discriminative, multi-generational economy with a long term focus on social and sustainable development. 
  • The planetary boundaries principle, it sounds simple but this is a tricky one, it means that we have to create this economical system within the planetary boundaries of the earth. This means we have to respect the boundaries of ecosystem alterations, pollution, extraction and biodiversity loss. Respecting these boundaries means of course that not only our generation but also the generations to come can safely live within the planet’s boundaries. 
  • The efficiency and sufficiency principle, this principle requires a significant mindset shift for huge parts of the earth’s population. It means we will have to limit our consumption and start to live with what is sufficient in an efficient way. This will shift our perspective to consumption to what we need not what we want, and to pull production (demand-based) and not push production (heavy marketing and unnecessary consumption). 
  • The good governance principle; the green economy will be guided by integrated, accountable and resilient institutions, that hold evidence-based norms to both science and industry. It motivates collaboration and requires transparency and public participation on all levels. 

The transition to the green economy is a significant transformative shift, which challenges the status quo and moves our socioeconomic systems from destructive to regenerative behaviour. It will require significant and transparent collaboration between governments, the scientific sector, the global industry and last but not least, consumers or better said, individuals. 

Green Economy Progress (GEP Index)

The Green Economy Progress Index, or to stick to the abbreviation style the GEP Index, is a measurement framework developed by the United Nations Environment. Its purpose is to assess the effort and make cross-country comparisons of the progress towards achieving an inclusive green economy.  

Green Growth

‘Green Growth means fostering economic growth and development while ensuring that natural assets continue to provide the resources and environmental services on which our well-being relies.’- OECD (Organisation for Economic Co-Operation and Development)

‘Green Growth is growth that is efficient in its use of natural resources, clean in that it minimizes pollution and environmental impacts and resilient in that it accounts for natural hazards.’- Worldbank 

The concept of Green Growth was firstly adopted by South Korea, which announced a five-year plan for green growth back in 2009. Ever since South Korea has been the main ambassador for this fairly new concept, promoting it around the globe mainly through the OECD platform.  There are now 47  countries within the OECD, including various leading industrial nations, which are supporting the Declaration on Green Growth.  

The limitation of Green Growth 

Green Growth proposes the idea that we can build a green, sustainable and fair economy whilst still keeping the mindset of never-ending growth. This is in the simplest way phrased not possible on a finite planet, with finite resources. We can only create and sustain a Green Economy by rethinking our underlying economic models and truly shifting our approach and mindset from destructive and polluting to efficient, sufficient and regenerative. 

“A healthy economy should be designed to thrive, not grow” Kate Raworth, Oxford economist and publisher of the  

Decoupling 

Decoupling? In itself, it doesn’t say much at all. You can decouple a whole lot of things. A saddle from a horse, a fish from a tank or a piece of ham from the sandwich for your vegan friend. In this case, we are talking about decoupling economic growth from resource depletion and environmental degradation (e.g. biodiversity loss, ocean acidity, plastic pollution, deforestation.. the list goes on). 

“The term decoupling refers to breaking the link between environmental bads and economic goods.”OECD Environment programme 

The concept of decoupling was introduced by the OECD in 2001. And is since 2015 a central component of the United Nations Sustainable Development Agenda (the SDG’s).

There are two levels of decoupling, absolute (truly) and partial or relative decoupling. Relative decoupling is for example substituting oil-based energy with carbon-neutral energy. We know that eventually decoupling GDP from emissions is possible, it’s possible to have rising GDP whilst lowering emissions. The question is if we can do this fast enough. Can we decouple emissions fast enough from GDP to stay within the timeframe we have, net-zero by 2050? Countries around the world have historically different levels of emissions and different levels of growth and development. Meaning that high emitting countries have to reach net-zero sooner to be able to reach the global goal of net-zero by 2050. The shortened time frame, combined with economic growth, which means a higher energy demand, makes it very challenging to decouple emissions from GDP growth fast enough.

Besides this, we still haven’t figured out how to create truly long term and sustainable clean energy sources as most of our cleaner options are dependent on carbon-heavy production processes and finite materials with limited options for the end of life stages. Although we can be pretty sure that we will solve these problems, it doesn’t give us the green light yet, for even partial decoupling in the energy sector. 

And decoupling in the energy sector wouldn’t mean that we are then safe and within the planetary boundaries. It still doesn’t decouple us from the dependence and pollution of other resources and ecosystems. 

Is decoupling possible?

The concept of decoupling is not without critics and has been at the centre of many discussions around new economic models and a sustainable future. It is suggested that decoupling might be a central “fantasy” of the SDG agenda and a central ‘myth’ of green growth. Green Growth and decoupling are ideological ideas, which try to operate within the planetary boundaries whilst operating within the old paradigm of infinite growth, the concepts are failing to acknowledge the limits of environmental realities. The concepts serve as a smokescreen, allowing businesses to continue as usual for as long as possible, and with that shortening the time we have to take real and transformational action.  

Economic growth in general means an increase in the use of resources and the negative impact on ecosystems (or in the words of the OECD “environmental bads”). So if we can’t use more and more resources and negatively impact the environment, what does this mean for economic growth?

“Growth in GDP ultimately cannot be decoupled from growth in material and energy use. It is therefore misleading to develop growth-oriented policy around the expectation that decoupling is possible.” (Ward, 2016)

Luckily decoupling and Green Growth, or any of the other growths; inclusive, fair, balanced, aren’t the only proposed alternatives. Many new economic models propose ways in which we as humanity can thrive and stay within the planetary boundaries. We already explored a couple of these models in the last jargon busters; the doughnut, purpose and circular economy and will discuss a couple more in the next busters. 

Luckily we have other options; Doughnut, Regenerative, Circular..

The proposed new economic models have one thing in common: they move away from destructive systems and consider all stakeholders, not just the shareholders. 

“We have to invest in our economy so businesses are competing, not based on low wages, but on high-design, engineering, smart use of resources.” Angela Francis 

The goal is to create a new economic system, Green, Regenerative, Circular or a bit of all, that is not only technologically feasible but also works as an alternative for everyone. We can’t expect people in lower-income communities, who are struggling to make ends meet to give up the few things they have.  

“You want us to worry about the end of the world, whilst we are worrying about the end of the week”. 

It is not about climate action or environmental action, it’s about climate justice. 
“What the Climate Justice conversation has brought to the table is saying, if we save the planet at the expense of equality, is that even a planet we want to live on?” Hana Kajimura

If we all work together and embrace transformational change we can truly create an inclusive, fair, sustainable economical system that stays within the planetary boundaries and in which nobody falls through the hole of the doughnut.

Happy Sprinting

Minou & Pamela

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