9th June 2020
Worldwide, some 17 economic stimulus packages have been announced to date (as of the 5th June 2020), pumping approximately USD 3.5 trillion directly into sectors that have a large and lasting impact on nature. These flows present an opportunity to support these sectors through the current COVID-19 crisis, while increasing their sustainability and resilience in the face of the parallel climate and biodiversity crises. So far however, Vivid Economics’ latest report looking closely at these government responses shows many have largely failed to harness this opportunity, disregarding the broader sustainability and resilience impacts of their actions. Here, James Paterson-Waterson who led the report for Vivid, and has been an intrinsic part of the Greenkeeper team, provides an overview of the report’s findings.
In 13 of the 17 countries considered, potentially damaging flows outweigh those supporting nature. Of the more developed countries, the United States stands out as the largest scale risk, with $479 billion USD providing unrestricted support to sectors proven to be environmentally harmful in the past amidst several rollbacks on environmental regulation. Australia, South Korea, Japan, Germany and Spain join them on the negative side, owing largely to the existing negative impacts of their environmentally-intensive sectors, and their lack of decisive action to ensure stimulus supports a more sustainable transition. Packages in parts of Western Europe and Canada offer more promise with at least a portion of spending likely to be nature-friendly, with France and the UK benefitting from less environmentally-intensive economies and the retention of more stringent regulations and policies. Canada follows suit with several inherently green measures but is mired by an equally large set of destructive measures.
It is however, the ‘Next Generation EU’ recovery package that is set to be the ‘greenest’, to date. Initial proposals suggest substantial and sustained positive impacts for the climate and nature with a host of specifically targeted measures including policies to reduce dependence on fossil fuels, enhance energy efficiency, invest in preserving and restoring natural capital – something the Greenkeeper team are particularly passionate about. However, as the package is yet to be approved by the European Parliament, the Commission’s index score remains provisional.
Regardless of economic structure or past environmental performance, each country has the opportunity to steer their stimulus package to support nature and the climate. Looking across announcements to date, there are a clear set of tools emerging that provide lasting and immediate economic benefits while also accelerating the transition to a more sustainable future. These fall into the following broad categories:
- Corporate bailouts with green strings attached
- Investment in nature-based solutions and sustainable agriculture
- Loan and grants for green investments
- Subsidies or tax reductions for green products, and the removal of brown subsidies.
- Green R&D subsidies
- Reinforcing environmental regulation, and avoiding deregulation
James notes that “Our social and economic fate is inextricably linked to that of nature. Governments have the opportunity and responsibility to ensure short-term emergency measures lead to a better more resilient future. Nature has suffered a pandemic-like crisis for over a century. Human activity has accelerated the rate at which plant and animal species are becoming extinct by a factor of over 100 and paved the way for a growing climate crisis. To date, the global economic response to the COVID-19 crisis is set to reinforce this trend. However, there is an opportunity to act decisively now to prevent irreversible damage to nature and dramatically lower future costs of protecting the planet. In solving one crisis, we cannot ignore another.”
We firmly believe that tools like Greenkeeper provide the critical evidence to support spending decisions that will enable us to build back our economy while ensuring that nature is protected and enhanced. Greenkeeper and the wider understanding of how green infrastructure provides a vital backbone to our urban places is a key element of this and something the Greenkeeper UK team, including James and the wider Vivid Economics team, will be fighting hard to ensure the UK government acknowledge.
Author: James Paterson-Waterson