At the wake of declining global natural capital stocks, an increasing number of governments and organisations are endorsing the concept of a 'green economy' to value natural capital in economic activities. According to the United Nations Environmental Programme (UNEP), a green economy can be thought of as one which is low carbon, resource efficient and socially inclusive (UNEP 2011). Water is regarded as a focal point in the green economy because it is embedded in all aspects of development – food security, health, and poverty reduction – and in sustaining economic growth in agriculture, industry, and energy generation (GWP 2012). The Stockholm Statement of 2011 described water as the 'bloodstream of the green economy' to highlight the urgent need for the public and private sector to take serious action about improved water management to turn the global economy 'green' (GWP 2012).
The green economy's intellectual origins can be traced back the 1987 World Commission on Environment and Development (Brundtland Commission) to devise concepts on how to propose long-term environmental strategies to promote sustainable development. At the same time, debates in development economics have centred around Richard Solow's praradigm that technological innovation will be solve the environmental enigma triggered by the increasing 'resource crunch'. While the emphasis was placed on technological improvements such as the 'green revolution' in agriculture in the immediate post-war era, a paradigm change occured toward the need to improve institutional governance of natural resources. The field of 'green economics' emerged as a sub-field in economics in the academy since the 1960s to find innovative economic concepts to reconcile economic development with environmental scarcity. However, few green economic concepts were able to enter mainstream economics resulting in grave precitions that the world may face a 'resource crunch' in the coming decades due to overuse, mismanagement and igorance of the value of natural capital. The simultaenous population growth to 9 billion people by 2050 adds imposes further demands on natural resources. Thus, the world needs to find urgent solutions to the threat of a 'resource crunch', which may result in scenarios in which countries cannot provide food or energy to their poorest members of society.
Under the leadership of director general Achim Steiner, UNEP launched a green economy iniative in 2008/9 to identify coordinated strategies toward a green economy. In contrast to the Brundtland Commission, the UNEP initiative deliberately widens the approach from a state-centric one to a public and private concept to incorporate all stakeholders in society. The Green Economy Report by UNEP was launched in autumn 2011, which provides a holistic account on how to promote green growth.
Definition of the Green Economy
According to UNEP, the green economy can be defined as:
'an economy whose growth in income and employment is driven by public and private investments that reduce carbon emissions and pollution, enhance energy and resource efficiency, and prevent the loss of biodiversity and ecosystem services. These investments need to be catalyzed and supported by targeted public expenditure, policy reforms and regulation changes. This development path should maintain, enhance and, where necessary, rebuild natural capital as a critical economic asset and source of public benefits, especially for poor people whose livelihoods and security depend strongly on nature'.(UNEP 2011).
This marks a decisive point of departure for sustainable development and economic philosophy because the emphasis of UNEP's definition is placed on a pro-business, pro-poor and environmentally sustainable approach to economic development. By taking such an inclusive approach, UNEP echoed the criticisms toward the current economic paradigm, neoliberalism, which emphasises deregulation over regulation to promote economic growth. However, a deregulated economy is unlikely to take into account the limitations of environmental capital, hence the green economy concept as conceived by UNEP is a remarkable turning point in economic thinking.
The role of water in the green economy
As mentioned above, water is the metabolism of the green economy. Water is essential within the green governance of the increasingly globalised economy. As a result, a number of concepts that take reference to the green economy have emerged. For example, the Water-Energy-Food Nexus concept usefully points at the inextricable links between water security, energy security and food security. In each and every decision in the water, energy and agricultural sector, decisions are being made that conflict with the other sector. The nexus concept has been further expanded by climate scientists, who point at the impact of climate change on future water, energy and food security.
A major corner stone has been the 2011 Bonn NEXUS conference that initiated a dialogue among stakeholders in water, food and energy to develop policy instruments to address water, food and energy security (Nexus Website 2013). The conference resulted in regional initiatives by policy-makers, business leaders, development experts and scientists to address the nexus in economic development.
Another important initative to address the nexus challenge is the CEO Water Mandate, which was established in 2007. Under the roof of the United Nations Global Compact in New York and coordinated by the Pacific Institute in Oakland, 'the CEO Water Mandate seeks to make a positive impact with respect to the emerging global water crisis by mobilizing a critical mass of business leaders to advance water sustainability solutions – in partnership with the United Nations, civil society organizations, governments, and other stakeholders'. As Allan (2013) notes, the main managers of water resources are all located in the private sector, to which the public sector can merely provide regulatory frameworks.
Apart from global iniatives, green economic concepts are also addressed in smaller projects. GIZ has launched a small project in the Jordanian Azraq basin that has introduced solar farming practices to desalinate water on an area of 1000 m2 which provided drinking water for approximately 200 families in central-eastern Jordan. Although small in size, this project exemplifies what can be done in practice to place water at the heart of a small-scale green economy initiative by shifting Jordan’s farmers from fossil fuel energy consumers (water pumping) to clean energy producers (photovoltaic). It also addresses energy security because it eases Jordan’s heavy dependence on fossil fuel and gas imports in the agricultural sector. Water security is addressed due to solar farming's reduced groundwater abstraction, which is saving the country’s strategic water reserve for future generations. Food security is improved because solar farming contributes to food security at the household level. It provides stable income and keeps people living on their land. And at the national level solar farming frees foreign currency to pay for food imports that are otherwise needed to pay for fuel and gas imports for power generation. Finally, it helps to adapt Jordan's farmers to climate change because solar farming helps rural households to cope with climate change impacts in the water sector (GIZ 2013).
UNEP Green Economy Initiative
CEO Water Mandate
Water-Energy-Food Nexus Website