OECD says protecting environment affordable

Alister Doyle, Reuters 5 Mar 08;

OSLO (Reuters) - Tackling climate change and other environmental hazards is affordable but urgent action is needed to avert irreversible damage, the Organisation for Economic Cooperation and Development (OECD) said on Wednesday.

The 30-nation OECD said possible environmental safeguards might slow world growth by just 0.03 percent a year -- meaning that by 2030 the global economy would be 97 percent bigger than in 2005 instead of almost 99 percent larger with no measures.

"This is not a lot to pay," said Angel Gurria, head of the Paris-based OECD group of rich democracies in a 520-page Environmental Outlook issued in Oslo, saying costs were similar to those of an insurance policy.

"The consequences and costs of inaction...would be much higher," he said.

The study identified issues for most urgent action including global warming, losses of species of animals and plants, water scarcity, illegal logging, pollution and hazardous chemicals.

"If no new policy actions are taken, within the next few decades we risk irreversibly altering the environmental basis for sustained economic prosperity," it said.

The report recommended overhauling sectors that cause most damage -- energy, transport, agriculture and fisheries. "Removal of environmentally harmful subsidies, particularly for fossil fuels and agricultural production, is a necessary first step," Gurria said.

POLLUTION

A hypothetical policy package included a 50 percent cut in farm subsidies, a $25 per ton tax on emissions of heat-trapping carbon dioxide phased in by region, new biofuels, measures to cut air pollution and improved sewerage systems.

The measures would limit overall growth in greenhouse gas emissions to 13 percent rather than 37 percent by 2030. Stiffer greenhouse gas goals would be a slightly bigger brake on economic growth.

The study adds to evidence that curbing global warming, blamed mainly on use of fossil fuels, is affordable. Last year, the U.N. Climate Panel also said that measures to curb climate change would cost between 0.06 and 0.1 percent of world gross domestic product a year to 2030.

And a 2006 report by former World Bank chief economist Nicholas Stern warned that unchecked warming would be as damaging as world wars or the Great Depression with more floods, droughts, heat waves and rising seas.

More than 190 governments agreed in Bali, Indonesia, in December to work out by the end of 2009 a new treaty to fight climate change and succeed the Kyoto Protocol, which binds 37 developed nations to cut emissions by 2012.

The United States is outside Kyoto, with President George W. Bush reckoning it would damage the U.S. economy and saying it wrongly omitted 2012 curbs for developing nations. Washington has agreed to join a new global plan.

To combat climate change, the OECD said "developed countries will need to work closely with emerging economies -- especially Brazil, Russia, India, Indonesia, China and South Africa."

Without curbs, greenhouse gas emissions from China, India, Russia and Brazil alone "will grow by 46 percent to 2030, surpassing those of the 30 OECD countries combined," it said.

The OECD said that its members can point to some successes in recent decades -- industrial pollution has fallen, the area of forests and natural protected areas has increased and economies have become more efficient.

(Editing by Ibon Villelabeitia)

World can 'afford' to solve its environmental woes: OECD
Yahoo News 5 Mar 08;

The world could solve many of the major environmental problems it faces at an "affordable" price, the OECD said Wednesday, warning that the cost of doing nothing would be far higher.

In a report presented in Oslo, the Organisation for Economic Cooperation and Development suggested a range of measures to address what it said were the greatest global environmental challenges through 2030: climate change, biodiversity loss, water scarcity and the impact on human health of pollution and toxic chemicals.

"It's not cheap. It is affordable, but also it is considerably less onerous for mankind and for the economy than the alternative of inaction," OECD Secretary General Angel Gurria told reporters.

The suggested measures would cost just over 1.0 percent of the predicted global gross domestic product in 2030, meaning world wealth would grow on average 0.03 percentage points less per year over the next 22 years, the organisation said.

If nothing is done however, global greenhouse gas emissions could rise by over 50 percent by 2050, while "one billion more people will be living in areas of severe water stress by 2030 than today, and premature deaths caused by ground-level ozone worldwide would quadruple by 2030," the OECD report said.

"It has a positive cost-benefit result. Regardless of the ethical, of the moral, of the social, of the political consequences, simply looking at it from the business and the economic point of view, it is a better idea to start right away focusing on the environment," Gurria insisted.

The OECD said its proposed investment would allow the world to slash "key air pollutants by about a third," and significantly limit greenhouse gas emissions.

The group placed a special emphasis on the need to rein in carbon dioxide emissions through special taxes and increased emission trading.

"We know the enemy. It is called carbon. We have to fight the enemy and we have to put a high price on the carbon," Gurria said.

The OECD also suggested measures like increasing waste charges and implementing "more stringent regulations and standards" in the most environmentally harmful industries, like energy, transport, agriculture and fishery.

The organisation also insisted on the importance of international coordination and cooperation.

"If we do not have everybody, and that includes every single developed country but also Brazil, China, India, South Africa, Indonesia etc, it will obviously not work," Gurria said.

By 2030, Brazil, Russia, India and China's combined annual emissions "will exceed those of the 30 OECD countries combined," the group said.

This time, world should heed OECD call to action on environment
WWF website 5 Mar 08;

Paris: The OECD’s Environment Outlook to 2030, issued today, was welcomed by WWF as yet another compelling argument that the costs of inaction on the environment will far exceed the costs of action.

The OECD Outlook is the latest - and at 520 pages one of the weightiest - in a run of reports from prominent economic institutions and commissions calling on governments and international institutions to face up to the seriousness and immediacy of global environmental problems.

“When a body such as the OECD says that on a range of environmental issues we need to act globally and we need to act now, then it is clear that as communities, countries and companies we need to roll up our collective sleeves and get on with it,” said WWF International Director General James Leape.

“It is sobering to think how much better off we would be today if the world, the wealthy world in particular, had heeded OECD's 2001 call to take action on many of these same issues. We should not make the same mistake again.”

James Leape said the OECD outlook should be commended for looking beyond the urgent challenge of climate change to other urgent issues of biodiversity loss, mismanagment of water resources and escalating health threats. WWF also welcomed OECD’s call to prioritise action in the key sectors of energy, transport, agriculture and fisheries.

“The OECD outlook underlines both the magnitude of the largely self-inflicted threats we face and the urgency of acting effectively on them,” said James Leape. “It is rapidly becoming the case that it will be as hard to find a sceptical economist as it is now to find a sceptical scientist."

While generally supporting market liberalisation, the OECD noted that in the absence of “sound environmental policy and institutional frameworks” globalisation “can amplify market and policy failures and intensify environmental pressures”.

The OECD repeated its 2001 call for the removal of subsidies to environmentally harmful activities, with special mention of subsidies to fossil fuel use, agricultural production subsidies, fishing overcapacity subsidies and the subsidy and underpricing of damaging transport modes.

The OECD also repeated that environment policy should not be just a concern of environment ministers, but has to be elevated into being a priority of central and economic policy making in particular.

“There is now no reason not to act," said James Leape. "The OECD outlook is emphatic that the policies and technologies to address urgent environment issues are available and affordable, that taking them will increase efficiencies and reduce costs and that the earlier we take action, the better the cost-benefit equation will be.”