How do we create a performing economy that creates jobs and ensures our wellbeing, and yet respects the limits of our planet? This question is central to the future of our society in the 21st century. In answering this question, we must be ambitious in our thinking. 'Greening' our economy means changing the way we produce goods and services. But we should not focus on just a few sectors, such as renewable energy or other so-called 'eco-innovations', corresponding to five or even 10 per cent of our economy. The project is much bigger than that, requiring a transformation of the whole economy.
But why do we need to green our economy? The most simple reason is that economic activities currently harm human health and the environment as we exceed the limits of our planet. We are currently using resources faster than our planet can produce them; for example, consider fish, land or fossil fuels. And we are polluting the environment faster than it can be absorbed by the natural world. We see evidence of this in climate change. In 2012 oceans, plant growth and other 'sinks' were only able to absorb around half of humanity's greenhouse gas emissions, so levels in the atmosphere are increasing. In other words, we are living beyond our means and borrowing from the future. At the same time, we are weakening the resilience of our natural systems: their ability to regenerate and to produce, and also their capacity to adapt to situations such as climate change. This often translates into fewer benefits or ecosystem services from nature. For example, a forest weakened by pollution is less efficient at cleaning air or providing timber.
"In 2012 oceans, plant growth and other 'sinks' were only able to absorb around half of humanity's greenhouse gas emissions"
Unsustainable use of resources is not just an environmental problem. It has economic and social implications. Access to resources, exposure to pollution and the state of the world around us are key factors in determining health, wellbeing and quality of life in general. We must also change because we are actually wasting valuable resources. Some of these resources are very difficult or impossible to replace. Take rare earth metals or copper, which are highly valued goods in world markets. But when the electronic devices containing them are sent to landfill, they have no value; only environmental costs resulting in pure economic waste on top of the loss of irreplaceable resources. Sustainable use of resources is directly linked to the way we design and produce products. What gets extracted needs to be used again and again; the leftovers from one process needs to become the input of another. This is possible. We are now able to capture methane from cattle farms and use it for heating, something unimaginable decades ago.
We need to explore new technological possibilities and make innovative solutions the norm – research and business communities play a key role here. A mix of economic incentives and regulations can boost innovation and can actually improve the competiveness of European industry. Green economy principles need to be integrated in a wide spectrum of policies. Recent policies from the EU, including the 'roadmap to a resource-efficient Europe', are aiming exactly at better integration and coherence between policy targets.
Better links between these policies and sectors is increasingly necessary. For example, the EU is aiming at raising the share of manufacturing in the union's economy from its current level of 16 per cent of GDP up to 20 per cent by 2020. This goal must be achieved by taking into account another EU goal: reducing energy use by 20 per cent by 2020. This means industry will need to become more efficient. Moving towards a green economy may make us reconsider some existing policies. Europe aims to continue reducing greenhouse gas emissions, making huge cuts between now and 2050. Can we achieve this objective without seriously reviewing the way we currently structure transport or agriculture?
Nonetheless, a fundamental transformation of the existing systems will take time. In the EU we are currently shaping a four-decade perspective up to 2050, with more specific goals and benchmarks for 2020 and 2030. Although the transition might be a long-term process, it requires strong action and policies now. Some infrastructure works need to start today.