A major report released by the Global Commission on the Economy and Climate finds that we are significantly underestimating the benefits of cleaner, climate-smart growth. Bold climate action could deliver at least US$26 trillion in economic benefits through to 2030, compared with business as usual.
Unlocking the Inclusive Growth Story of the 21st Century finds that over the last decade there has been tremendous technological and market progress driving the shift to a new climate economy. There are real benefits to be seen in terms of new jobs, economic savings, competitiveness and market opportunities, and improved wellbeing for people worldwide. Momentum is building behind this shift by a wide range of cities, governments, businesses, investors and others around the world, but not fast enough. The report arrives just one week before the Global Climate Action Summit in San Francisco.
“The purpose of this report is to demonstrate how to accelerate the shift to this new growth path,” said Helen Mountford, Programme Director of the New Climate Economy and lead author of the report. “It lays out the benefits of doing so, the challenges ahead, and the clear accelerators or actions, that can be taken to fully reap the rewards of stronger, cleaner and more equitable growth.”
“We are at a unique ‘use it or lose it’ moment,” said Ngozi Okonjo-Iweala, former Finance Minister of Nigeria and Co-Chair of the Global Commission. “Policymakers should take their feet off the brakes, send a clear signal that the new growth story is here and that it comes with exciting economic and market opportunities. US$26 trillion and a more sustainable planet are on offer, if we act decisively now.”
“The momentum from businesses, states, cities, investors and citizens is now unstoppable, not least because those taking bold climate action are already seeing tangible benefits,” said Paul Polman, CEO of Unilever and Co-Chair of the Global Commission. “But if we are to unlock the full benefits of this new, low-carbon growth opportunity and avoid runaway climate change, economic and financial leaders in both government and the private sector need to do even more, and fast.”
The report highlights opportunities in five key economic systems – energy, cities, food and land use, water and industry – demonstrating that ambitious action across these systems could deliver net economic gains compared with business as usual, while:
- Generating over 65 million new low-carbon jobs in 2030, equivalent to today's entire workforces of the UK and Egypt combined.
- Avoiding over 700,000 premature deaths from air pollution in 2030.
- Generate, through just subsidy reform and carbon pricing, an estimated US$2.8 trillion in government revenues per year in 2030 – equivalent to the total GDP of India today – funds that can be used to invest in other public priorities or reduce distorting taxes.
“We can now see that this new growth story embodies very powerful dynamics: innovation, learning-by-doing, and economies of scale. Further, it offers us the very attractive combination of cities where we can move, breathe and be productive; sustainable infrastructure that is not only clean and efficient, but also withstands increasingly frequent and severe climate extremes; and ecosystems that are more productive, robust and resilient,” said Lord Nicholas Stern, I G Patel Professor of Economics and Government at the LSE and Co-Chair of the Global Commission. “Current economic models fail to capture both the powerful dynamics and the very attractive qualities of new technologies and structures. Thus, we know we are grossly underestimating the benefits of this new growth story. And further, it becomes ever more clear that the risks of the damage from climate change are immense, and tipping points and irreversibilities getting ever closer.”
The Global Commission calls on governments, business and finance leaders to urgently prioritise actions on four fronts over the next 2-3 years:
- Ramp up efforts on carbon pricing and move to mandatory disclosure of climate-related financial risks;
- Accelerate investment in sustainable infrastructure;
- Harness the power of the private sector and unleash innovation; and
- Build a people-centered approach that shares the gains equitably and ensures that the transition is just.
“This is more than just a report,” said Felipe Calderon, former President of Mexico and Honorary Chair of the Commission. “It is a manifesto for how we can turn better growth and a better climate into reality. It is time we decisively legislate, innovate, govern and invest our way to a fairer, safer, more sustainable world.”