How can we define Green Growth?
Green growth can be defined as a means of stimulating economic development and growth, while also ensuring that the natural resources and environmental services essential to our well-being continue to be available. Green growth offers a realistic and adaptable framework for making meaningful, quantifiable progress across its economic and environmental pillars, and takes into consideration the social implications of greening nations’ growth dynamics. Green growth policies are centered on assuring that natural resources can fulfill their full economic potential in a sustainable way. Examples of this potential include the provision of crucial life support services, such as clean air and water, as well as the resilient biodiversity required to maintain food production and human health.
Green growth strategies must be adjusted to the individual circumstances of each country. Countries must carefully consider managing any potential trade-offs while also maximizing the synergies between poverty reduction and green growth. Examples of the latter include bringing more efficient infrastructure to people (such as in energy, transportation and water), addressing poor health caused by environmental degradation and integrating efficient technologies which can lower costs and raise productivity, while easing environmental pressure. Green growth strategies can minimize vulnerability to environmental threats and boost the livelihood security of the poor in low-income countries, due to the importance of natural assets in these nations.
Green growth methods also acknowledge that reliance on GDP as the primary indicator of economic progress undermines the significance of natural resources in terms of health, wealth, and happiness. As a result, green growth must rely on a wider spectrum of progress indicators, including the composition and quality of growth, as well as how this impacts people’s wealth and well-being.
What does Green Growth mean for Bangladesh?
As one of the fastest growing economies in South Asia, Bangladesh continues to experience sustained economic growth underpinned by macroeconomic stability and strong domestic demand. The country has been growing at an annual average rate of 6 percent for the last decade. Its progress on key human development indicators has continued to improve and it is now one of the best performing countries in South Asia, with higher life expectancy, lower fertility rates and lower infant mortality. Bangladesh has also made good progress on the achievement of the MDGs, particularly in terms of reducing income poverty, getting nearly all boys and girls enrolled in primary school, and reducing child and maternal mortality.
So why does Bangladesh need Green Growth? What does it mean for the country? Current policies and strategies to accelerate economic growth in Bangladesh are not always consistent with environmental protection. In particular, past growth has been reliant on industrialisation that is not environmentally-conscious. The pattern of urbanisation contributes to severe water and air pollution, providing yet another major challenge for environmental protection. Bangladesh is in urgent need to adopt formally a “green growth strategy” that fully reconciles the development agenda with the protection of the environment. In the absence of the green growth strategy and associated regulations, policies and institutions, the costs of environmental degradation have grown over time. Additionally, the adverse effects of climate change are mounting and creating substantial downside risks and vulnerabilities. Against the backdrop of this, the government’s preparation of Vision 2041 under which Bangladesh is envisaged to reach World Bank-defined high-income threshold by FY2041 and eliminate absolute poverty provides an important opportunity to take a fresh look at the environmental degradation and climate change risks. Unless required regulations, policies and institutional reforms are undertaken to fully reconcile the growth and poverty-reduction agenda with the environmental protection needs, there is a substantial risk that the income and poverty targets of Vision 2041 will not be achieved. Thus, embracing green growth strategy is highly crucial for Bangladesh and needs to be urgently implemented.
The agenda for green growth for Bangladesh is undoubtedly daunting, but not impossible. The 2041 Perspective Plan provides a major opportunity to jump start the green growth agenda and step up the policies, programs, institutional reforms and financing that will allow Bangladesh its growth and poverty agenda with environmental protection. The Perspective Plan 2041 seeks to transform Bangladesh from lower middle income to an upper middle- income country by 2031 and eventually to a high- income country by 2041. These are highly ambitious but laudable targets. To achieve these targets the government must pay attention to increasing the annual average GDP growth rate to 8 percent plus and sustain this over the longer term. Sustainability of this growth path requires the adoption of a green growth strategy. Research done for the Perspective Plan suggests that in order for Bangladesh to implement a green growth strategy to ensure consistency of growth and poverty reduction targets with environmental protection, the country needs to increase its spending on environmental protection and climate change related programmes from 1 percent of GDP now to 3 percent of GDP by 2031 and to 3.5 percent of GDP by 2041. It must ensure the full implementation of the Bangladesh Delta Plan (BDP2100), and imp0lement the green growth strategy, policies and institutional reforms that are embedded in the 8th Five Year Plan.
A holistic approach to sustainable development at the national level was first adopted in the Bangladesh Delta Plan BDP2100 that was task managed by PRI with technical assistance supported provided by Netherlands and the World Bank. The BDP2100 integrated sustainable development issues with the macroeconomic framework for the first time in the history of development planning and policy making by explicitly recognizing the financial cost of environmental degradation and its effect on the GDP growth rate. The BDP2100 also brought to the fore the critical role of public investment programs to reduce climate change and natural hazard vulnerability by tackling these vulnerabilities at the source and at the national level rather than tinkering at the margin at the village or community levels. It also emphasized the urgent need to strengthen and establish new institutions, develop local level capacities and highlight the importance of cost recovery policies to manage critical infrastructure related to flooding, irrigation, river bank erosion control, urban water and sanitation, and river transport systems. Finally, and very importantly, BDP2100 brought out openly the link between poverty reduction and environmental management by highlighting the role of climate change and natural hazard vulnerability.
The green growth vision incorporated in the Delta Plan 2100 and the Perspective Plan 2041 has been translated into a 5-year implementation plan in the 8th Five Year Plan. The main focus is on sustainable management of water, which is a top priority for Bangladesh given its impact on green growth (flooding; land degradation through salinity and water logging; droughts and water shortage), water pollution, safe drinking water supply and municipal waste management. This needs to be strengthened with focus on management of air pollution that does the most health damage to Bangladesh. Strategic thinking on how air pollution could be lowered to safe levels is essential. This will be some combination of lowering use of fossil fuel, managing methane gas emission, and managing industrial, construction, and transport pollution. A combination of environmental regulations and standards, taxes and subsidies, proper pricing policies of fossil fuel, water supply and sanitation, and green economy based public and private investments will be necessary.
Under the 2016 landmark Paris Climate Agreement, 174 countries and the European Union committed to Nationally Determined Contributions (NDCs) to keep the global average temperature rise below 2°C and pursue efforts to limit it to 1.5°C. However, according to the 2018 Inter-Governmental Panel on Climate Change (IPCC) special report, global efforts to limit emissions consistent with 2-degree warming are not on track. At the upcoming 2021 United Nations Climate Change Conference in November, also known as COP26, countries will be asked to share the action and increased ambition they plan to tackle climate change. With this context, the PRI aims to conduct an extensive country-specific desk review on development and climate change, which will serve as a basis to inform future engagement on long-term strategies, NDC updates, and help to identify gaps where further deep-dive studies may be needed. All of this is expected to serve as inputs to the planned annual country specific Climate Change Development Report (CCDR) that the World Bank is preparing for Bangladesh.