What Do We Mean by Green Economy?
Doreen Fedrigo-Fazio
Patrick ten Brink
Source: IEEP
The United Nations Environment Programme (UNEP) Green Economy Initiative (GEI) defines a green economy as “one that results in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities”. In its simplest expression, a green economy can be thought of as one which is low carbon, resource efficient and socially inclusive.
A transition toward a green economy is characterized by a shift in capital allocation from fossil fuels and financial assets toward resource efficiency, aimed at correcting fundamental economic imbalances. This economic model results in improved human well-being and social equity while significantly reducing environmental risks and ecological scarcities. It operates as a system that is low carbon, resource efficient, and socially inclusive, ensuring that development remains within planetary boundaries.
Green economy and environmental challenges are addressed by reforming traditional economic models that historically under-valued natural capital. Systemic issues such as climate change, biodiversity loss, and resource over-exploitation are viewed as trade-offs that risk undermining long-term development and prosperity. Strategies in this framework focus on shifting public and private investment into clean technologies and natural resources to ensure a healthy, resilient planet capable of supporting a growing global population.
Policy options and research insights for a green economy involve a structured transition through several interlinked building blocks. This process includes avoiding unsustainable trade-offs by better balancing economic, environmental, and social objectives through tools like impact assessments and the reform of harmful subsidies. Implementation requires robust environmental compliance and infrastructure, alongside proactive risk management that utilizes the precautionary principle and better indicators for ecological thresholds. The ultimate objective is a state of absolute decoupling, where economic growth is entirely separated from environmental impacts and resource consumption, supported by good governance and integrated accounting.
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