Smarter and more efficient use of the world’s natural resources today means the next generation will reap annual economic benefits of $2tr by 2050, while off-setting the costs of ambitious climate change action, new research released by the International Resource Panel (IRP) shows.
The global population is set to grow by 28% and is predicted to use 71% more resources per capita by 2050, it says. Without urgent steps to increase efficiency, the global use of metals, biomass, minerals such as sand, and other materials, will increase from 85 to 186bn tonnes per year by 2050.
The report, “Resource Efficiency: Potential and Economic Implications”, released at the G20 meeting in Berlin last week, found that while investment in ambitious climate action would cause a 3.7% fall in per capita Gross World Product by 2050, this cost to the economy could be offset by more efficient use of resources.
For example, between 2005 and 2010, a UK programme recycled or reused 7m tonnes of waste destined for the landfill. This move saved 6m tonnes of carbon dioxide emissions, close to 10m tonnes of virgin materials and another 10m tonnes of water. It also increased business sales by £176m, reduced business costs by £156m and created 8,700 jobs.
“By making better use of our planet’s natural gifts, we will inject more money into the economy to create jobs and improve livelihoods. At the same time we will create the necessary funds to finance ambitious climate action.”
Globally, more sustainable use of materials and energy would not only cover the cost of keeping global warming below 2 degrees Celsius, but also add an extra $2tr to the global economy by 2050, the IRP says.
“This is an environmental win-win,” said Erik Solheim, Head of UN Environment. “By making better use of our planet’s natural gifts, we will inject more money into the economy to create jobs and improve livelihoods. At the same time we will create the necessary funds to finance ambitious climate action.”
The report analysed four paths that countries could take over the next three decades, ranging from ‘business as usual’ to a scenario where countries adopt both ambitious climate policies and improve resource efficiency.
Other key findings:
- Increased resource efficiency is practically attainable.
- There are substantial areas of opportunity for greater resource efficiency.
- Resource efficiency can contribute to economic growth and job creation.
- Improving resource efficiency is indispensable for meeting the costs of climate change targets.
The report also found that economic gains of resource efficiency will be unevenly distributed. A slower resource extraction would reduce revenues and affect jobs in some industries, such as mining and quarrying.
But even with these considerations, countries stand to gain more by implementing compensation and transfer policies to ease the transition to more efficient practices, than by continuing to support inefficient activities, according to the report.
In addition to economic benefits, the analysis also shows that resource efficiency and climate action would reduce global resource use by around 28 percent in 2050 compared to current trends.
For G7 countries, resource efficiency, coupled with ambitious climate action, would increase Gross Domestic Product by $600bn in 2050 ($600 per person, or 1%).