Compromise between Green Growth and Growth with Pollution

Introduction
With the onset of globalization and international trading, the world has narrowed its focus on economic development. It pursues economic development at all costs, leaving the environment and other human and material resources damaged and exploited. Everywhere, people and institutions pine for growth, without pondering on the consequences of this growth. However, the recent patterns of natural calamaties and climate changes, which are strongly being felt internationally, left governments and institutions, as well as commercial companies, to highly consider economic development aligned to ecological sustainability and managed growth. This leads us to the concept of green growth as against the normal growth with grave pollution and other environmental consequences.
Green growth means environmentally sustainable growth (The World Bank Website, 2015). It is efficient utilization of the natural resources, reduction of pollution and ecological consequences, and the management of the resources against natural calamities and physical risks (The World Bank Website, 2015). Green growth also includes ecological management for a well managed commodity pricing (The World Bank Website, 2015). It is an instrument to attain sustainable development and it is also a direction which balances the need for growth and the consciousness of the irreversible ecological hazards this rapid growth carries (Friedrich Ebert Stiftung Website, 2015). To reiterate, green growth is not stagnation, it is a way towards achieving economic growth while protecting the environment (Friedrich Ebert Stiftung Website, 2015).

This leads us to the concept of green growth as against the normal growth with grave pollution and other environmental consequences.This paper aims to explore the pros and cons of economic growth as geared towards greening versus the growth with no green consciousness. It shall explain the need for green growth, why countries aim to acknowledge and/or ignore green growth, and the various costs, benefits or advantages of going green, and the costs of greening. Various conclusions and suggestions will also be offered by this paper.
INTERNATIONAL CONTEXT !!!!!!
Green growth means environmentally sustainable growth (The World Bank Website, 2015). It is efficient utilization of the natural resources, reduction of pollution and ecological consequences, and the management of the resources against natural calamities and physical risks (The World Bank Website, 2015). Green growth also includes ecological management for a well managed commodity pricing (The World Bank Website, 2015). It is an instrument to attain sustainable development and it is also a direction which balances the need for growth and the consciousness of the irreversible ecological hazards this rapid growth carries (Friedrich Ebert Stiftung Website, 2015). To reiterate, green growth is not stagnation, it is a way towards achieving economic growth while protecting the environment (Friedrich Ebert Stiftung Website, 2015).
The Need for Green Growth
Green growth aims to alleviate poverty, increase equity, and provide opportunities without imparting negative ecological effects (Friedrich Ebert Stiftung Website, 2015). It intends to develop a green economy, which the United Nations Environment Programme (UNEP) refers to the “outcomes in better human development and social equity, while greatly lessening ecological risks and scarcities” (The World Bank Website, 2015). While economic growth is necessary, especially for the developing countries, this is not the only yardstick by which progress is measured (The World Bank Website, 2015). It is not enough criterion for development.
Economists believe that Third World countries must focus on fulfiling their fundamental requirements before being able to manage their natural resources, as they are only making less environmental imprints (Friedrich Ebert Stiftung Website, 2015). However, this is not a sound argument. Various sectors agree that a good environmental performance has many benefits, such as safe and clean air and water, solid waste management, protection from natural disasters, among others (2015, p. 2). In sum, these benefits lead to greater productivity and poverty reduction (2015, p . 2). Hence, it is imperative that Third World and other developing countries should mind their sustainable growth (2015, p. 2).
Another important argument is that environmental performance does not instantly lead to increased national income (The World Bank Website, 2015). In general, national accountabilities are only within the boundaries of domestic affairs. National governments usually resolve local environmental concerns such as polluted air and water. On the contrary, domestic concerns with complex or discreet impacts persist, such as climate change and loss of biodiversity (The World Bank Website, 2015).
Lastly, it is not possible to attend to the ecological damages after a certain level of economic growth has been achieved (Friedrich Ebert Stiftung Website, 2015). No one can ever clean up the environment after economic growth since the damages to various environmental assets are irreversible (2015, p. 2). It would take a century or a millenium to reverse climate change (2015, p. 2). In addition, economic and technological consequences also lead to a considerate inertia. In the end, economic choices made by deliberately ignoring the environmental impacts shall have greater economic costs in the future (2015, p . 2). For instance, the urban development projects initiated in developing countries cannot be reverted or later modified once the need for energy reduction and reduced energy costs become top priority (2015, p. 2).
Green growth, as manifested by a sound environmental policy, can result in commercial and industrial cost cutting such as the reduced resource costs from enhanced resource efficiency, expanded growth in ecological industries and greater global competitiveness for “first movers” (or those who initially adopted green growth), and less risks and more resilience to environmental effects (Everett, et. al., 2010). Likewise, green growth can have a significant effect on the endowment and welfare of the next generations (Everett, et. al., 2010). To explain, the negative effects to environmental assets not only impact the present generation but it affects the next generations. Hence, green economy aids in the decisions on the use of environmental assets as evaluated on the longer time scales.
Case Examples of Green Growth
After the 2007 -2009 global financial meltdown, green growth was applied by many developed countries. For instance, U.S. President Barack Obama, the European Union, and various American states and European nations all implemented the integration of green energy investment to job creation (Zysman, et. al., 2012). It brought about enormous quantity of economic stimulus funds amounting to billions of dollars. These funds were allocated to energy efficiency, renewable energy, and energy-associated research and development, which cumulatively accounted to anywhere from 10% to 80% of national stimulus financing (Zysman, et. al., 2012). They believed that green energy industry attains lower labor productivity than the fossil-fuel power utilities.
In reality, green growth is easier than done. According to Resnick & Thurlow (2012), green growth implemention has distributional consequences and, in turn, great political impacts for governments of developing countries. For example, carbon emissions reduction remains as a main component of green growth strategies (Green Economy Coalition Website, 2015). However, this can be attained if countries deviate from the course suggested by conventional development theory. As mentioned, the high short-term costs of green growth agendas can have the same political effect as the structural adjustment programs of the past, which generated appropriate anti-reform coalitions, which usually included both powerful interest groups and the poor sectors of the economy. It is best to understand the gap, which limits turning towards green growth in a more general context of the developing world’s lack of financing in infrastructures (The World Bank Website, 2015). There are short and long term benefits and disadvantages of applying green growth strategies and programs.
As it is, developing countries are highlighted by large, unfulfilled needs, which include needs met by infrastructure like potable water and secured electricity (The World Bank Website, 2015). The scale of unmet needs is very significant in Sub-Saharan Africa, where less than one third of the population have access to electricity (2015, p. 1). At present, the developing countries are investing about half of the amount required to fill their infrastructure gaps (estimated at $1.0 – 1.5 trillion annually or 7 percent of the developing country’s GDP (2015, p. 1).
For instance, India has a great potential for making a green economy with reduced carbon consumption. Ernst&Young ranked it as the “fourth most attractive developing country for renewable energy investment” (Friedrich Ebert Stiftung Website, 2015). India also has the second biggest pool of scientists and engineers globally. Hence, it is an attractive and secured investment destination. Its success in information technology, professional services and communications also enhance its attractiveness (2015, p. 1). Even with this impressive profile, the populous country still cannot complete its move towards green growth. The old economic system has helped India in its economic growth and wealth creation but it has also widened the social inequity in the country. The increasing industrialization has brought about various conflicts (2015, p. 1). The most serious of these conflicts is the one between farmers/forest residents and industrialists, more so, the miners. It brought about internal security problems. Hence, the unabated internal problems and the unaddressed ecological imbalance in its industries are projected to lead into negative GDP growth (estimated between -9% to -13%) (2015, p. 2). This will be brought by the negative effects of climate change affecting India’s business and livelihood (2015, p. 2).
Environmental damages have taken a special toll both the country’s economic growth and its human resources. For instance, in China, a recent study by its leading environmental intellectual agency rounds up the cost of environmental damages to Chinese economic growth at about US$230 billion in 2010 or 3.5% of China’s GDP, which is over three times the rounded cost of degradation in 2004 (which was US$ 62 billion) (Green Economy Coalition Website, 2015). In Indonesia, the lack of water and sanitation cost the Indonesian economy over 2% of its GDP in 2005 (2015, p. 1). In Central African Republic, the internal air pollution, inadequate access to water and poor hygiene presently cost 8% of the central African’s GDP annually (2015, p. 1). In other developing economies such as China, Indonesia, and Central African Republic, green growth can only attain success it they are able to accomplish two major policy goals:
• Lessen economic costs and losses due to ecological degradation by including the value of environmental assets in strategic national priority setting, intelligent policy making and institutional reform;
• Creation of quality jobs and poverty reduction – these will enhance social equality by green investments in sectoral policies such as renewable energy, managed fisheries and risk proof infrastructure.
In retrospect, the failure of developing countries to act on green growth also has adverse effects on its economic performance. Likewise, renewable energy and energy efficiency also need innovative public financing tools. Renewable energy requires huge capital with a long return on investments. It also carries technology risks linked with emerging technologies (like concentrated solar) or extraordinary resource risks (such as geothermal drilling) (2015, p. 2). Energy efficiency investments tend to be small, with high transaction costs. Hence, financial institutions may not find them attractive in the lack of credit line provisions to heighten confidence and capacity and tools to augment small transactions (The World Bank Website, 2015).
As illustrated by South Africa, Malawi and Mozambique, the green growth problems are likewise due to the similar factors stated above. The growth strategy of South Africa has historically depended on the exploitation of its ample coal deposits, the state’s energy sector investment, and subsidized electricity prices (Resnick & Thurlow, 2012). Coal accounts for almost all of South Africa’s electricity supply, which requires to double over the next twenty years so as to meet growing demand and inch the service delivery gaps. Of course, a coal-based development approach is not attuned to the green growth program. The country’s per capita emission levels are already the same with the developed economies such as those of the European Union, even when South Africa’s per capita income was three times lower (2012, p. 2). The South African government acknowledges the importance of addressing climate change and has committed to almost reducing in half the national emissions data by 2025 (2012, p. 2). Steering from coal-fired electricity will accumulate both economic costs and political resistance. Also, the renewable energy sources are more expensive than coal and it is estimated that to attain its national emissions target, South Africa must invest an extra US$63 billion over the US$108 billion cost of a “the traditional” plan (2012, p. 2). There is also an opportunity cost of not utilizing the remaining 12 decades of coal reserves. An imposition of a carbon tax resulting to a projected 5% increment in national income was also considered. All these initiatives will need proper restructuring of the South African economy (2012, p. 2).
Another setback in greening the economies of developing countries is the vital political opposition from very important stakeholders. For instance, some South African businesses are worried about losing export competitiveness, loss of employment, the rising costs of energy prices, and the likes. As evidenced, South Africa met resistance in 2008 when it implemented electricity tariffs. There were nationwide demonstrations and various protests on the carbon tax (2012, p. 2). This makes a green growth very difficult.
Economic Development with Pollution
In the last two decades, growth has alleviated the lives of more than 660 million people out of poverty and increased their income levels. However, most of these growths have impacted damaging effects on the environment. Various market, policy and institutional shortcomings resulted to a drastic loss of natural capital which tended to be used in ways which were economically inefficient and wasteful, without due regard to the social costs of the environmental depletion and without initiatives for reinvestments into other forms of wealth. Moreso, even with economic development, 1.3 billion still has no access to electricity; 2.6 billion lacks sanitation; and 900 million still do not have potable drinking water (The World Bank News, 2012). Hence, it has not been an inclusive growth but growth with pollution and ecological damages.
An illustrous example is the case of China. China’s environmental degradation has stirred so much controversies as it is the leading emitter of greenhouse gases all over the world (Thinking Directions Report, 2008). China’s local environmental problems have global effects and have been a global concern. China’s environmental problems due to international growth and development include the following: air and water pollution, accumulation of natural resources overseas, among others. Studies estimated that by this year China will complete its initial round of industrial modernization, by which time it will have attained an economic growth comparable to the majority of western countries in 1960 (2008, p. 2).
During the 1960’s, the notions of environmentalism had only began in the United States (2008, p. 2). During this time, China’s per capita ecological footprint was still insignifcant at 1.5 global hectares per person. This is very low compared to the world’s average of 2.2, a remarkable 9.7 for the United States and 5.6 for the UK (as reported by the World Wide Fund) (2008, p. 3). Hence, after several years, China developed its economy and opened up to the world. It has become the global manufacturing center. Export trading drove the country’s growing pollution and resource requirements more than its local consumption. In fact, the average Chinese consumes very low as 48% of Chinese GDP was intended for savings (2008, p. 3). Meanwhile, China has become the world’s third biggest exporter, taking after Germany and the United States (2008, p. 3).
A significant portion of the Chinese exports was primary goods or manufactured products that entail heavy pollution and need intensive resource uses. A significant 40% percentage of China’s energy use goes into its exports. With stringent environmental regulation in the developed countries, the production of many energy intensive goods has been sent to China. This was a classic case of outsourcing since the Western countries have also already depleted its energy resources and have accumulated industrial pollution. Hence, China produced much of the goods at cheaper prices yet it also accrued most of the negative environmental effects which these productions entail. This has led to its depleted environmental as well.
The Chinese government has already targeted its green growth program and directions for ecological balance through its five-year plan. It aims to reduce its energy intensity by 20% and further lessen its emission of major pollutants by 10% (2008, p. 3). It also targets to attain 20% forest coverage rate and treat 70% of its wastewater and 60% residential garbage in urban areas (2008, p. 3). However, these targets have yet to be accomplished until now.

Compromise between Green Growth and Growth with Pollution
Green growth can only be a success if it includes complementary measures that help those who are negatively affected to adjust and adapt. For instance, national governments should consider exchanging fossil fuels subsidies with compensatory cash transfers to the low and middle classes. The national governments might prefer direct transfers since these are more efficient and equitable means of poverty reduction. Many countries have learned that subsidy reform systems are only as robust as the entailed political will and the governments’ ability to de-politicize the levelling of prices, for instance through international markets price linkages instead of a malleable regulatory institution (The World Bank Website, 2015).
In addition, green growth will only be possible if the economy is well equipped to shift toward new sectors and this shall rely on the presence of a sound economic setting, with skilled workers who are able to jump into higher productivity sectors, safety nets to mitigate losses and aid affected workers, financial access to capital to aid new sectors develop and invest, a steady regulatory environment which provides assurance for investors, etc. (2015, p. 2). Green growth policies will be efficient and successful if there are excellent growth policies. Hence, green growth is not a substitute or alternative but a complementary growth policy (The World Bank Website, 2015).
There are various ways which hinder the push for green growth and/or green strategies yet there are also various ways to integrate growth with environmental balance. In a long term perspective, green growth can prevent future environmental crises. For example, the greater energy efficiency and reduced reliance on fossil fuels (specifically on imported fuels) will lessen economic vulnerability to fuel price shocks (The World Bank Website, 2015). Poor and developing countries can also adopt large-scale energy efficiency programs (such as the weatherization of buildings) and some natural resource conservation actions (like reforestation activities) (The World Bank Website, 2015). They can also make investment to green their economy.
International cooperation also provides important support to developing countries to manage its transition to green growth. The main pillars of action are financing sound development planning and green infrastructure, strengthening access to global markets to promote trade in green goods and services, and in encouraging technological transfer and cooperation. (Green Economy Coalition Website, 2015)
The hindrances to green growth can be overcome with the help of the public sector, global financial institutions, and bilateral donors as they give funds for project preparation and provide concessions for pioneer investments (2015, p. 2). These types of support can go a long way toward altering risk-return profiles and providing investors more confidence in the long-term sustainability of their green projects. Likewise, financing can also be supported by “fund of funds” under which governments invest a relatively limited amount of long-term capital in various private, professionally managed funds that they invest in energy efficiency. Also, energy service companies (ESCOs), which provide customers with energy auditing, propose energy-savings methods and financing. These can aid in consolidating the various small transactions that are required for energy and water efficiency (The World Bank Website, 2015). Greening infrastructure can be attained only if green growth policies are inclusive and it deals with the cost issue. Inherently, green growth cannot be successful if it is not inclusive. (The World Bank Website, 2015).
Conclusion
Green growth is paramount, especiallyin the developing world where there is a rapid population growth and demographic shifts. Growth in both economic and social development measures must be instantenous and yet it must also be balanced. Each national economy should develop a policy decisions pertaining to greening since this will have a serious and irreversible effects and implications during the present times and in the future (The World Bank Website, 2015).
Some economies are better equipped than the others in moving into a greener economy but each country can adopt the fundamentals of green growth. Green growth integrates variability, acknowledging that low, middle, and high-income countries have varied agenda and will thus apply very different green growth techniques (The World Bank Website, 2015). Green growth should prioritize both people and the environment before economic gains. It should pursue a rights-based strategy to sustainable development, that is, to human development within the earth’s limitations. The access to basic requirements like water, food, sanitation and fundamental healthcare needs to be ascertained as a fundamental right instead of submitting everything to the dynamics of the market. More so, further commodification of the environment leads to further concentration, not distribution of wealth. This, in turn, makes up for the new socio-political issues that redound to irreparable damage to the ways to democracy.
• WHAT DOES THE GREEN GROWTH MEAN FOR COMPANIES’ FUTURE STRATEGY? INNOVATION; R&D; TRADE; FDI
• CHANGES OF ECONOMIC STRUCTURE?
• WHAT ARE THE NEW THINGS YOU WOULD LIKE TO HIGHLIGHT? WHAT ARE YOUR OPINIONS? WHAT ARE NEW ASPECTS?
• THE ENTIRE TEXT TOO MUCG DEPEMDENT ON A FEW REFERENCES
• USE TABLES & FIGURES
• YOUR ARGUMENTS ARE TOO GENERAL; NO SPECIFIC “FRESH” ARGUMENTS OF YOUR OWN
• CASE STUDIES SHOUD BE BETTER CONSTRUCTED AND CATEGORISED AS WELL AS COMPARED: WHAT DO WE LEARN FROM THESE DIFFERENT CASES??

References:
MORE JOURNAL ARTICLES !!!
Everett, T., et. al. (2010). Economic Growth and the Environment. Department for Environment Food and Rural Affairs.
Friedrich Ebert Stiftung Website. (2015). “Green Economy – A Sustainable Concept.” Retrieved on April 23, 2015 from, http://www.fes-sustainability.org/en/discussions/green-economy-sustainable-concept.
Green Economy Coalition Website. (2015). What Green Growth Means in Developing Countries? Retrieved on April 23, 2015 from, http://www.greeneconomycoalition.org/know-how/what-green-growth-means-developing-countries.
Resnick, Danielle & Thurlow, James. (September 11, 2012). Green Growth: A Win-Win Approach to Sustainable Development? United Nations University. Retrieved on April 23, 2015 from, http://unu.edu/publications/articles/green-growth-a-win-win-approach.html.
The World Bank News. (2012). From Growth to Inclusive Green Growth: The Economics of Sustainable Development. Retrieved on April 23, 2015 from, http://www.worldbank.org/en/news/feature/2012/05/09/growth-to-inclusive-green-growth-economics-sustainable-development.
The World Bank Website. (2015). FAQ: Inclusive Green Growth. Retrieved on April 23, 2015 from, http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTSDNET/0,,contentMDK:23185024~pagePK:64885161~piPK:64884432~theSitePK:5929282,00.html.
Thinking Directions Report. (2008). Environmental Degradation vs Economic Growth in China. Retrieved on April 23, 2015 from, http://www.salterbaxter.com/directions-2008-environmental-degradation-vs-economic-growth-in-chin/.