- More or Less Sustainable ? -
Presentation by
Erik H. Brandsma
Task Manager "Changing Consumption and Production Patterns"
Economics and Finance Branch
Division for Sustainable Development
at the
Brazil - Norway Workshop
Sustainable Production and Consumption - Patterns and Policies
Brasilia, Brazil 25 - 28 November 1996
Your Excellencies, Mr. Chairman (Madam Chair), ladies and gentlemen,
Let me start by saying how pleased I am to be here, and to thank the
Governments of Brazil and Norway for organizing and hosting this timely
workshop. I am in particular pleased because it was here in Brazil where
almost five years ago the issue of "Changing Consumption and
Production Patterns" was born. Since then Chapter 4 of Agenda 21
has received increasing attention in the international policy making
arena.
In this address I will give an overview of the events and activities
that took place over the past four/five years, I will try to highlight
some of the policy implications of current patterns in consumption and
production, and I will identify some of the key elements that underlay
the discussion of the issue.
During UNCED in 1992 the issue of changing consumption patterns was
born out of the recognition that reducing the environmental impacts of
consumption and production and reducing population growth were both
necessary if sustainable development is to be achieved (Rio Principle
8).
A key element in this discussion is the acknowledgement that
unsustainable consumption and production patterns, particularly in
industrialized countries are the major cause of the deteriorating global
environment. This element is clearly recognized in Chapter 4 of Agenda
21 and re-affirmed at all sessions of the Commission on Sustainable
Development (CSD). Furthermore, it was emphasized at UNCED that all
countries should strive to promote sustainable consumption patterns and
that developed countries should take the lead in achieving sustainable
consumption patterns.
A closer look at current patterns in consumption illustrates
that the issue still, or maybe increasingly, deserves greater attention
in sustainable development policy making.
For example:
- over the last 45 years the global economy has nearly quintupled.
Consumption of grain, beef and water has tripled, while paper use has
risen 6 times. The use of fossil fuels has grown fourfold, and CO2
emissions likewise (Brown et all., 1996).
- the poorest one fifth of humankind have a cash income of less than
1 $US per day, and the next fifth averages around 3$ per day. This means
that 40 % of the world population account for 6.5 % of the world's
income. This gap between rich and poor is growing and has doubled over
the last thirty years (Worldbank, 1996).
- also since 1950, and reflecting differences in per capita incomes,
the richest fifth has doubled its per capita consumption of energy,
meat, timber, steel and copper, and quadrupled its car ownership. The
per capita consumption of the poorest fifth has hardly increased (Durning,
1996).
- the USA is the greatest source for carbon emissions,
accounting for around 22 % of the global emissions. The carbon emissions
of the industrialized countries, - the OECD - account for 44.7 % of
global total emissions (WRI, 96-97). The emissions continue to increase
and reflect the growth in industrialized societies. Increasing numbers
of people in developing countries, in particular in several major
developing economies, are beginning to approximate consumption patterns
similar to the middle income classes in developed countries. These
consumers in for example China, India, Venezuela, Brazil, Argentina,
South Korea, Taiwan, Indonesia, Malaysia and Thailand roughly total 750
million (Myers, 1996), almost as many as the 880 million consumers in
the industrialized countries.
- the global economy is expected to grow at an average rate of 3-4 %
per year, and global GDP will grow from 20 to 200 trillion dollars by
the middle of the next century (Worldbank, 1996). If we assume that the
current global economy is nearing the world's environmental carrying
capacity, at least for its capacity to absorb CO2 emissions, a ten fold
increase will seriously challenge human creativity in designing an
economy that will provide global prosperity and can be environmentally
sustainable.
An important first step in re-evaluating existing development
and economic growth was made at Rio, 5 years ago, by firmly establishing
the issue of sustainable consumption and production on the international
policy making agenda. It was, and to a certain extent is, a very new
issue in policy making world. In fact, we know a lot more about how we
can influence fertility and mortality, than about how we can effectively
influence human consumption behavior.
The first Oslo Round table defined sustainable consumption as " the
use of services and related products which respond to basic needs and
bring a better quality of life while minimizing the use of natural
resources and toxic materials as well as the emissions of waste and
pollutants over the life-cycle of the service or product so as not to
jeopardize the needs of future generations".
The UN Commission on Sustainable Development recognized in the
early stages of the discussion on Chapter 4 that policy measures which
are directed at changing consumption and production patterns can have
major impacts on many of the economic, social and environmental
objectives of sustainable development. The issue is increasingly seen as
an integrating principle. A focus on changing consumption and production
pattern is especially useful for integrating environmental and economic
factors, for focusing on the demand side as well as the supply side of
the economy, and for highlighting the need for policy measures which
affect the behavior of a large number of economic agents.
Many, if not most, of the problems arising from unsustainable
consumption and production patterns are due to the fact that
environmental services are undervalued and, thus, tend to be used
wastefully, whether as inputs into the production process or at the
end-use stage in households or by public institutions. Most
environmental services are undervalued due to several types of
institutional failures. Market failure is widespread because too many
environmental costs are externalized; pollution in all its forms is the
best example; and here government intervention in markets is in order
and is of critical importance to internalize such costs. Take for
example gasoline, in the USA the price of gasoline is even below the
price of bottled water. If all externalities, such as air pollution, and
some non-fuel externalities, e.g. noise pollution, were to be included
in the price, Americans could be paying at least 6 times more, and
Europeans 2 times more per gallon of gasoline than at present.
Policy failure is also widespread, for example when governments
intervene in markets in ways which actually encourage unsustainable
practices, such as many subsidies in agriculture. These can be addressed
by policies which internalize external environmental costs to the
economic agents responsible, by removing subsidies which encourage
unsustainable consumption and production practices, by creating
institutional mechanisms to manage global commons, by helping the poor
secure sustainable livelihoods and, generally, by raising environmental
consciousness. -Altogether these 'perverse' subsidies for
non-sustainable development total some $600 billion per year, an amount
equal to the budget allocated for the implementation of Agenda 21 at
UNCED 1992 (Myers, 1996).
In the Commission on Sustainable Development, changing
consumption and production patterns is also one of several highly
interlinked subjects including, as well, innovative financial
mechanisms, the use of economic instruments, and trade and sustainable
development; in the end the discussion in all four areas points to the
need for an internationally harmonized approach towards the
internalization of environmental externalities.
In the CSD, this reflects its commitment to the principle of
common but differentiated responsibility which recognizes, on the one
hand, the need for developed countries to lead by taking effective
measures for change in their own countries and, on the other hand, the
benefits that accrue to all countries from establishing and monitoring
more sustainable consumption and production patterns. This principle is
especially important when distinguishing between policy approaches
appropriate for global commons issues and those appropriate for national
or local environmental issues.
Measures which internalize environmental costs to the economic
agents responsible for these costs, are necessary but not sufficient for
changing behavior on a large scale. These need to be accompanied by
measures which facilitate or magnify the responses of economic agents.
Thus, a list of policy options might include: regulatory instruments,
economic incentives and disincentives, social incentives and
disincentives, facilities and infrastructure, information and education,
and technology development and diffusion.
Another important strtegy for policy making is eco-efficiency.
Increased efficiency, can have significant economic and environmental
benefits. The efficiency in resource use can be increased through fewer
material inputs, longer product life-times, and less pollution. This can
already be realized, in a large extent, through waste prevention,
recycling and by using available technologies. There are many examples
of experiences, e.g.. in Sweden and Japan, that show that important
savings can be generated while making industries more productive and
competitive.
DOW Chemicals in Louisiana, USA, implemented energy saving and waste
reduction measures that yielded a rate of return, on the relatively
small investment made, averaging over 200 % per year (Lovins, 1996).
These first measures may well be the low hanging fruits, but they can
nevertheless amount to significant environmental and economic benefits.
Another recent study shows that energy efficiency efforts in
industrialized countries as a whole could reduce investments needed to
increase energy supply capacity by 50 % over the next 30 years, an
amount of around $700 billion. Similar initiatives in developing
countries could mean savings of 40 %, totaling some 1.5 trillion dollars
(Roodman,1996).
Governments need to stimulate these developments and innovations
through careful policy making, e.g. with economic incentives and
disincentives, collection and dispersement of best practice, transfer of
information and technology, and capacity development.
In addition Governments have a role to play in setting standards,
showing leadership, and stimulating niche markets through procurement
policies and improving their environmental performance. But this issue
will be further explored by Jeremy Eppel of the OECD later during this
workshop.
Important steps have been taken to implement policy approaches
to changing consumption and production patterns, by a handful of
national Governments, with Norway as a "lead country", the
OECD Environment Directorate, and some members of the NGO and Business
communities.
The government of Norway organized two Ministerial round tables, in
1994 and 1995, which were instrumental in stimulating and scoping the
debate. The action programme as defined at the second round table in
Oslo in 1995 still stands as the major overview of actions and
initiatives to be taken to make consumption and production patterns more
sustainable.
I would like to highlight a few of the key outcomes of the 1995
Oslo Round Table conference. The report of the Conference, entitled
"Elements for an international work programme on sustainable
production and consumption," proposed a range of specific actions
to encourage greater efficiency and equity in the use of energy, land,
water, and other resources, and to minimize and avoid pollution and
waste. Many of these issues are also on the agenda of this workshop.
Particular emphasis was placed on:
(i) Building partnerships for sustainable consumption between
different sectors of society, and reinforcing the values that support
sustainable consumption;
(ii) Establishing a suitable policy framework for sustainable
consumption by moving towards environmentally sound pricing;
(iii) Extending producer responsibility for the environmental
impacts of goods and services;
(iv) Setting a government example in sustainable consumption
through environmentally sound public procurement and administration;
(v) Empowering individuals and households to adopt more
sustainable consumption patterns.
In this menu of recommendations, Governments have the
responsibility to provide the framework of incentives, infrastructure,
regulation and leadership that will enable other actors to take up their
responsibilities for their part of the chain from production to
consumption and final disposal.
Several other countries such as the Netherlands, Republic of
Korea, Australia, Sweden and now also Brazil have contributed, and
continue to contribute, to the debate through organizing workshops,
initiating studies, and through developing and implementing policy
intended to make current patterns of consumption and production more
sustainable..
The OECD Environment Directorate has set up an OECD wide Work
Programme on Sustainable Consumption and Production Patterns, and will
soon report its findings, after two years of implementation, to the OECD
Ministerial. The Work Programme has been both a guidance for, and a
facilitator of, initiatives undertaken by the OECD member countries. The
OECD/Norway workshop held in Rosendal in 1995 examined the conceptual
framework of the issue and concluded among other things that
eco-efficiency is one of the most promising policy strategies in
tackling the above outlined challenge, in particular in combination with
time bound targets for performance. Other projects are on the way in the
areas of transport, and the consumption of water and paper. OECD
emphasizes the value-added that can be obtained from a new focus on the
management of consumption - demand - as a complement to existing work on
production - the supply side.
Many Non-Governmental Organizations and the Academic Community
have combined efforts and have initiated regional and global networks,
specifically with a focus on consumption and production patterns, and
have developed concepts such as eco-space and ecological footprints.
The Business and Industry community have actively participated in the
debate by operationalising the concept of cleaner production and
eco-efficiency. The World Business Council for Sustainable Development
has initiated a working group on sustainable consumption and production,
where currently for example discussions are focussed on "consumer
needs in relation to sustainable development" and "the role of
the retail sector in influencing consumer choice".
At the third session (11-18 April 1995) of the Commission, a
major work programme on changing production and consumption patterns was
adopted. The work programme has five main elements:
i. identifying the policy implications of projected trends in
consumption and production patterns;
ii. assessing the impact on developing countries of changes in
consumption and production in developed countries;
iii. evaluating the effectiveness of policy measures intended
to change consumption and production patterns, such as
command-and-control, economic and social instruments, government
procurement policies and guidelines;
iv. eliciting time bound voluntary commitments from countries
to make measurable progress on those sustainable development goals that
have an especially high priority at the national level, and
v. revision of the U.N. guidelines for consumer protection to include
guidelines for sustainable consumption patterns.
The CSD International Work Programme is in its first year of
implementation, and activities and projects have been initiated under
all elements of the work programme by national governments, UN agencies
and other International Organizations, and several Major Groups as
defined in Agenda 21.
Among the activities initiated by the CSD Secretariat, the UN
Division for Sustainable Development, are projects on:
- the identification of a preliminary core set of indicators to
measure changes in consumption and production patterns.
- the analysis of trade opportunities for developing countries due to
changes in consumption and production patterns in developed countries
- the development of a database on new and innovative policy
measures and instruments that are intended to make consumption and
production more sustainable, and
- the facilitation of the process for the revision of the UN
Consumer Protection Guidelines to include principles of sustainable
consumption.
The interest and attention given to this issue is increasing, in
particular in the context of the up-coming UN General Assembly Special
Session and its preparatory process - CSD-5 and the meeting of the Inter
Sessional Working Group. In addition to the high profile the issue is
getting through Environmental NGO's and the Business community,
organizations such as Consumers International, the Inter-Parliamentary
Union, the International Confederation of Free Trade Unions, and the
International Council on Local Environmental Initiatives have all
expressed a special interest in the CSD discussions on this topic, and
have often announced to make an own contribution to the debate.
There is also increasing interest and support for the debate on
this issue from developing countries. In the first place, it is well
recognized that policies developed and implemented in industrialized
countries intended to make consumption and production more sustainable
may have negative impacts on the trade opportunities for developing
countries.
For example: the German Government introduced in 1989 a ban on PCP (Pentachlorophenol),
a substance used extensively at that time in the leather industry in
India. This industry came under ever mounting pressure after other
countries e.g. the USA and in Scandinavia, adopted a similar ban. At
that time India urgently needed information, testing facilities and
alternatives for PCP.
Ecolabelling schemes and the implementation of ISO 14000
environmental management standards can also have similar adverse effects
on the exports of developing countries, especially by small and medium
enterprises.
It is clear that policies developed and implemented by
industrialized countries need to be evaluated for their impacts on the
developing countries. Pro's and con's need to be evaluated and losses
minimized. It should never be the case that policies designed to correct
unsustainable consumption and production patterns in industrialized
countries, are implemented at the cost of the development opportunities
in developing countries.
Secondly, interest in developing countries is increasing because of
the realization that economic development may entail negative
environmental impacts at the local level, that can be addressed more
cost-effectively by taking action sooner rather than later. Developments
in some of the dynamic Asian developing countries are illustrative in
this regard. There is much demand for the exchange of information on
best practice policies. Increasingly developing countries need support
to set up an adequate infrastructure to address the negative
environmental effects of rapid changes in consumption and production
patterns.
Another essential aspect in this debate is the growing
consensus that eco-efficiency is a promising policy strategy. The last
session of the CSD identified eco-efficiency as a guiding principle for
policy making. This in itself is not surprising. In simple terms
eco-efficiency means: producing with less energy and raw materials, and
with less environmental impacts, thereby saving dollars and the
environment. The strategy is based on a win-win situation, is currently
largely targeted at the production side, and has an important
technological component. We could say a typical no-regret strategy.
Much can be gained through the implementation of eco-efficiency
practices. Respected academics have concluded that a factor four
improvement in efficiency in material and energy intensity can be
achieved with existing technologies. The drive for increased
eco-efficiency will also stimulate and direct, much needed,
technological development.
An important question in this is however, whether developing
countries will be able to keep up with the developments in technological
innovations which may be undertaken to increase efficiency in production
and consumption in industrialized countries. This issue will also need
additional attention in the CSD discussions on technology transfer and
financing for sustainable development.
Mr. Chairman / Madam Chair,
I would like to conclude with a few remarks highlighting some
key elements for policy discussions, in particular in the context of the
preparations for the UN General Assembly Special Session and the session
of CSD-5 - this being a prep-com for the Special Session.
An essential element in making further progress on this issue will be
enhanced national and international cooperation. Not only among
Governments at different levels, but also with and among Major Groups.
The past five years have witnessed increasing attention to the issue of
changing consumption and production patterns on the part of most
stakeholders in society: business, labor, the academic community,
environmental NGO's, churches, consumer groups, local authorities and
many more.
An even more increasing role for Major Groups is apparent because
after five years of discussions on the more conceptual dimensions of the
issue, a more action oriented approach is currently being advocated. We
are moving more towards implementation. This development plus a somewhat
re-oriented view on the role of government in policy making, in
particular in some developed countries, are resulting in more
responsibilities and privileges, more empowerment, or more
self-regulation for Major Groups in tackling issues of efficiency
improvements and cleaner production.
My hope is that this workshop will provide the CSD with some useful
inputs for the discussion on this issue at the UN GA Special Session,
and beyond. The workshop is timely, and its format and framework
promising for fruitful discussions. The chosen format to explore
"sustainable consumption and production" within the sectors of
Energy, Forests, Land and Water will provide some valuable experience on
how conceptual analysis can be operationalised and implemented in
practice at the sector level. This may well be one of the options for
the CSD discussions beyond 1997.
Mr. Chairman, Ladies and Gentlemen, fellow participants, let me
thank again the Governments of Brazil and Norway for hosting and
organizing this event, and I look forward to our discussions and this
type of continuing international co-operation in the pursuit of more
sustainable consumption and production patterns.
Thank You.
|