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Ensuring Sustainable Development Is A Matter Of Human Decency: Jeffrey Sachs

2012-02-12T06:19:00.000-08:00

Home News & Analysis Ensuring Sustainable Development Is A Matter Of Human Decency: Jeffrey Sachs

Ensuring Sustainable Development Is A Matter Of Human Decency: Jeffrey Sachs

By: Jeffrey D. Sachs Date: 7 February 2012

About The Author

Professor of Economics & Director of the Earth Institute at Columbia University. Special Adviser to

Jeffrey D. Sachs, EconomyWatch Contributor

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Sustainable development means inclusive economic growth that protects the earth’s vital resources. Yet achieving it will be a matter not only of technology, market incentives, and appropriate regulations; we must embrace sustainable development as a common commitment to decency for all human beings, today and in the future.

Are We The Cause Of Our Own Destruction?
Photo Credit: Jonathan Kos-Read

ADDIS ABABA – Sustainable development means achieving economic growth that is widely shared and that protects the earth’s vital resources. Our current global economy, however, is not sustainable, with more than one billion people left behind by economic progress and the earth’s environment suffering terrible damage from human activity. Sustainable development requires mobilizing new technologies that are guided by shared social values.

United Nations Secretary-General Ban Ki-moon has rightly declared sustainable development to be at the top of the global agenda. We have entered a dangerous period in which a huge and growing population, combined with rapid economic growth, now threatens to have a catastrophic impact on the earth’s climate, biodiversity, and fresh-water supplies.

Scientists call this new period the Anthropocene – in which human beings have become the main causes of the earth’s physical and biological changes.

The Secretary-General’s Global Sustainability Panel has issued a new report that outlines a framework for sustainable development. The GSP rightly notes that sustainable development has three pillars: ending extreme poverty; ensuring that prosperity is shared by all, including women, youth, and minorities; and protecting the natural environment. These can be termed the economic, social, and environmental pillars of sustainable development, or, more simply, the “triple bottom line” of sustainable development.

Related: The Pursuit of Happiness – Will Economic Objectives Stand in the Way? : Jeffrey D. Sachs

Related: Development, But At What Price? Lessons from the Happiest Place in Asia

The GSP has called for world leaders to adopt a new set of Sustainable Development Goals, or SDGs, that will help to shape global policies and actions after the 2015 target date for achieving the Millennium Development Goals (MDGs). Whereas the MDGs focus on reducing extreme poverty, the SDGs will focus on all three pillars of sustainable development: ending extreme poverty, sharing the benefits of economic development for all of society, and protecting the Earth.

It is, of course, one thing to set SDGs and quite another to achieve them. The problem can be seen by looking at one key challenge: climate change. Today, there are seven billion people on the planet, and each one, on average, is responsible for the release each year of a bit more than four tons of carbon dioxide into the atmosphere. This CO₂ is emitted when we burn coal, oil, and gas to produce electricity, drive our cars, or heat our homes. All told, humans emit roughly 30 billion tons of CO₂ per year into the atmosphere, enough to change the climate sharply within a few decades.

By 2050, there will most likely be more than nine billion people. If these people are richer than people today (and therefore using more energy per person), total emissions worldwide could double or even triple. This is the great dilemma: we need to emit less CO₂, but we are on a global path to emit much more.

We should care about that scenario, because remaining on a path of rising global emissions is almost certain to cause havoc and suffering for billions of people as they are hit by a torrent of droughts, heat waves, hurricanes, and more. We have already experienced the onset of this misery in recent years, with a spate of devastating famines, floods, and other climate-related disasters.

So, how can the world’s people – especially its poor people – benefit from more electricity and more access to modern transportation, but in a way that saves the planet rather than destroys it? The truth is that we can’t – unless we improve dramatically the technologies that we use.

We need to use energy far more wisely while shifting from fossil fuels to low-carbon energy sources. Such decisive improvements are certainly possible and economically realistic.

Consider the energy inefficiency of an automobile, for example. We currently move around 1,000 to 2,000 kilograms of machinery to transport only one or just a few people, each weighing perhaps 75 kilograms (165 lbs.). And we do so using an internal combustion engine that utilizes only a small part of the energy released by burning the gasoline. Most of the energy is lost as waste heat.

We could therefore achieve huge reductions in CO₂ emissions by converting to small, lightweight, battery-powered vehicles running on highly efficient electric motors and charged by a low-carbon energy source such as solar power. Even better, by shifting to electric vehicles, we would be able to use cutting-edge information technology to make them smart – even smart enough to drive themselves using advanced data-processing and positioning systems.

Related: Thunder Road: Sparking a Revival for the Electric Car

Related: Green growth or de-growth: What is the best way to stop businesses destroying the biosphere?

Related: How Technology Is Revolutionizing Services: Jeffrey D. Sachs

The benefits of information and communications technologies can be found in every area of human activity: better farming using GPS and micro-dosing of fertilizers; precision manufacturing; buildings that know how to economize on energy use; and, of course, the transformative, distance-erasing power of the Internet. Mobile broadband is already connecting even the most distant villages in rural Africa and India, thereby cutting down significantly on the need for travel.

Banking is now done by phone, and so, too, is a growing range of medical diagnostics. Electronic books are beamed directly to handheld devices, without the need for bookshops, travel, and the pulp and paper of physical books. Education is increasingly online as well, and will soon enable students everywhere to receive first-rate instruction at almost a zero “marginal” cost for enrolling another student.

Yet getting from here to sustainable development will not just be a matter of technology. It will also be a matter of market incentives, government regulations, and public support for research and development. But, even more fundamental than policies and governance will be the challenge of values. We must understand our shared fate, and embrace sustainable development as a common commitment to decency for all human beings, today and in the future.

By Jeffrey D. Sachs

Copyright: Project-Syndicate, 2012

Jeffrey D. Sachs is a Professor of Economics and the Director of the Earth Institute at Columbia University. He is also a Special Adviser to the United Nations Secretary-General on the Millennium Development Goals, as well as being the founder and co-President of the Millennium Promise Alliance, a nonprofit organization dedicated to ending extreme poverty and hunger. Sachs has authored numerous books, including The End of Poverty and Common Wealth. In 2004 and 2005, He was named among Time Magazine's "100 Most Influential People in the World”.

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http://www.economywatch.com/economy-business-and-finance-news/ensuring-sustainable-development-is-a-matter-of-human-decency.07-02.html

Australia's 2015 Economic Outlook

2012-02-12T05:22:00.001-08:00

Australia's 2015 Economic Outlook

Australia’s Economic Forecast

Spurred by robust business and consumer confidence, Australia’s economy is expected to grow even quicker in the next five years. 2011 to 2015 should see Australia’s GDP (PPP) grow by 4.81 to 5.09 percent annually. By the end of 2015, Australia’s GDP (PPP) is expected to be US$1.122 trillion.

Likewise, Australia’s GDP (PPP) per capita is expected to experience healthy growth. In 2010, Australia’s GDP (PPP) per capita was the tenth highest in the world – growing from US$38,633.17 in 2009 to US$39,692.06. In 2011, Australia’s GDP (PPP) per capita will increase by 3.52 percent to US$41,089.17. The following four years should see fairly consistent growth in Australia’s GDP (PPP) per capita, resulting in a GDP (PPP) per capita of US$47,445.58 by the end of 2015.

However, despite Australia’s strong economic growth, Australia’s unemployment rate has been relatively high. In 2010, Australia’s unemployment rate was 5.192 percent – 0.22 percent more than the world’s average of 4.97 percent.

In an interview given before the May 2011 budget, Australia’s Treasurer and Deputy Prime Minister, Wayne Swan, acknowledged that unemployment was unacceptably high in certain parts of Australia and the government was looking to create new incentives for more jobs. The May 2011 budget is expected to create 500,000 jobs in two years and is aimed at bringing unemployment rates down to 4.5 percent.

Whether this budget will prove successful in bringing down unemployment rates remains to be seen. According to the unemployment rate forecast provided by the IMF, unemployment is only expected to see a marginal decrease to 5.025 percent by the end of 2012. After which, the unemployment rate from 2013 to 2015 should remain constant at 4.8 percent.

Credit: Income Protection Insurance

In recent times, inflation rates have been another cause for concern. According to the Australian Bureau of Statistics, the increasing costs of food and fuel caused Australia’s inflation rate to be higher than expected in the first quarter of 2011. Yet, Australia’s inflation rate (average consumer price change) was still able to recover better from the financial crisis compared to most other advanced economies. In 2010, Australia’s inflation rate (average consumer price change was 2.962 percent, returning from 1.82 percent in 2009. Significantly, this was only marginally lower than the average inflation rate (average consumer price change) before the financial crisis from 1999 to 2008 (2.987 percent).

By the end of 2011, Australia’s inflation rate (average consumer price change) is expected to rise to 3.038 percent. However from 2013 onwards, Australia’s inflation rate (average consumer price change) is expected to fall below 3 percent once again and be between 2.65 percent and 2.498 percent from 2013 to 2015.

Australia’s current account balance has remained in negative figures for more than fifty years – caused by a narrow export base as well as high levels of capital goods from overseas. In 2010, Australia had one of the top ten highest current account balance deficit in the world at US$29.928 billion. The Australian current account balance deficit is expected to rise even further in the next five years, reaching US$89.106 billion in 2015.

Find out more about Australia's Economic Forecast on Economywatch.com

Read more about Australia's economy, including industry information and trade statistics on EconomyWatch below.

Australia’s Industry Sectors

2012-02-12T05:21:00.001-08:00

Australia’s Industry Sectors

In 2010, Australia’s GDP composition was as follows – agriculture (3.8 percent), industry (24.9 percent), services (71.3 percent).

As with most advanced economies, Australia has a dynamic service sector. This includes industries such as banking, insurance and finance; the media and entertainment industries; consulting, tourism and retail; services provided by government, such as education, health and welfare; and other personal and business services.

Among these industries, banking, finance and insurance are the best performers; providing the highest gross-value as well as being among the fastest growing industries in Australia. The Australian share market is the second largest in the Asia–Pacific region behind Japan, based on free-float market capitalisation. The Australian Securities Exchange is also the 11^th largest stock exchange in the world going by market capitalisation.

While the service industry remains the backbone of Australia’s economy, Australia’s mining industry has been the catalyst for economic growth in the past decade. Large quantities of minerals and resources can be found in Australia. Australia has the world’s largest resources of recoverable brown coal, lead, rutile, zircon, nickel, tantalum, uranium and zinc, and ranks second in the world for bauxite, copper, gold, ilmenite and silver. Iron ore is another extremely valuable asset, with high demand from China.

Find out more about Australia's Industry Sectors on Economywatch.com

Australia’s Export, Import & Trade

2012-02-12T05:20:00.001-08:00

Australia’s Export, Import & Trade

In 2009, China became Australia's largest export market, surpassing Japan.

Resources continue to underpin Australia’s exports to China. Australia exported 266.2 million tonnes of iron ore to China in 2009, an increase of 45.2 per cent over the same period.

China is also Australia’s largest source of imports. Major imports from China include clothing, communications equipment, computers, prams, toys, games and sporting goods, furniture and televisions.

The vast scale of trade with China has seen massive investments by Chinese companies in Australia. From 2007 to 2010, Chinese investment in Australia amounted to nearly US$60 billion. Australia’s mineral exports also grew by 55 percent to US$139 billion in 2010 and are projected to reach US$180 billion in 2011, thanks to China’s strong economic performance. Chinese companies have also started to lease land from the Australian government to mine resources on their own.

Along with their relationship with China, Australia holds multiple free trade agreements with numerous other countries such as the US, Singapore, Chile and Thailand. Australia is also a member of numerous organisations such as APEC, the G20, WTO and OECD.

However, Australia’s most notable trade partner is New Zealand. The Australia New Zealand Closer Economic Relations Trade Agreement (ANZCERTA) was enforced in 1983, building upon the 1965 New Zealand Australia Free Trade Agreement (NAFTA, not to be mistaken for the North American Free Trade Agreement). The ANZCERTA has greatly integrated both economies and there are now plans to create a single Australasian economic market by 2015.

Today, Australia is ranked 19^th in the world for both imports and exports.

Find out more Australia's Export, Import and Trade on Economywatch.com

Australia’s Economic Structure

2012-02-12T05:18:00.002-08:00

Australia’s Economic Structure

This been obtained through a stable and modern institutional and regulatory structure. Australia was ranked third in the 2011 Economic Freedom Index behind Hong Kong and Singapore and continues to provide an ideal environment for business and environment.

Domestically, Australia’s economy can also be characterised by an east/west divide. The eastern part of Australia is home to the majority of Australia’s service and financial industries. It also contains Australia’s capital city Canberra, the heart of Australia’s political and economic policies. Western Australia, on the other hand, controls the majority of Australia’s natural resources, including iron ore, gold, oil and natural gas.

The contrast between these two regions has often led to disagreements within the Australian government over developmental plans. Although Australia’s GDP is still dominated by its service and financial industries, these industries have been struggling in recent years. On the other hand, Australia’s resources and commodities industries are currently experiencing a boom period. According to Canberra-based Access Economics, growth in regions endowed with minerals and oil and gas will far outstrip growth in the country’s more populous states next year. However, concerns have also been raised on whether the resource and commodities industries are too reliant on exports to China.

Find out more about Australia's Economic Forecast on EconomyWatch.com

Australia Economy

2012-02-12T05:18:00.000-08:00

Former Australian Prime Minister Kevin Rudd once described Australia to be a nation whose origins lie firmly in the west, “but whose geo-political and geo-economic circumstances are shaped in large part by our location in the east… this is the inescapable expression of the Australian condition.”

Today, Australia’s economy has truly reflected this “condition”. Prior to the 1970s much of Australia’s trade was held with the European and North American markets. During this period, Australia was also considered as a relatively closed and protectionist economy. However, as key economic reforms were gradually being introduced by the Australian government, the Australian economy also started to turn their attention away from trade with the Western markets to trade within the Asia Pacific region.
This shift has turned Australia into one of the fastest growing advanced economies in the world. Australia is the 13^th largest economy in the world according to nominal GDP (current prices) and the 17^th largest according to GDP (PPP). In 2010, Australia’s GDP (PPP) was US$882.344 billion – a 3.94 percent increase from 2009. Australia’s nominal GDP (current prices, US dollars) growth during the same period was even more amazing – GDP (current prices, US dollars) grew from US$994.25 billion in 2009 to US$1.219 trillion, a 22.68 percent increase.

In the past two decades, Australia has enjoyed a period of uninterrupted economic growth – an average of 3.3 percent in real GDP growth annually. Australia possesses a well-diversified economy boosted by the strength of its services and resources industries.

[edit] 2000 – 2010 – Rise of Developing and Emerging Economies

2012-02-12T04:56:00.001-08:00

2000 – 2006 – United States still leads, but China is catching up

At exchange rates, the economic output of 176 markets expanded by $17.4 trillion from 2000 to 2006. The five largest contributors to global output expansion are the United States at 20%, China at 9%, Germany at 6%, the United Kingdom at 6%, and France at 5%. The economic output of 4 markets contracted by $94.2 billion from 2000 to 2006. The three largest contributors to global output contraction are Japan at 80%, Argentina at 19%, and the Uruguay at 1%.

At purchasing power parity, the economic output of 180 markets expanded by $19.2 trillion from 2000 to 2006. The five largest contributors to global output expansion are the United States at 18%, China at 17%, India at 6%, Japan at 5%, and Russia at 4%.

2007 – China leads expansion

The economic output by nominal GDP of 183 markets expanded by $6.4 trillion during 2007. China accounted for 12% while the United States accounted for 10%, Germany accounted for 6%, and the United Kingdom accounted for 6% of the global output expansion.

2008 – credit crisis begins

The economic output of 171 markets expanded by $5.8 trillion during 2008. China accounted for one-sixth of the global output expansion. The economic output of 11 markets contracted by $267 billion during 2008. The United Kingdom accounted for one-half while South Korea accounted for two-fifth of the global output contraction. Though the crisis first affected most countries in 2008, it was not yet deep enough to reverse growth.

2009 – credit crisis spreads

At exchange rates, the economic output of 127 markets contracted by $4.1 trillion during 2009. The United Kingdom was the largest victim accounting for 12% while Russia accounted for 11% and Germany accounted for 8% of the global output contraction. The economic output of 56 markets expanded by $767.1 billion during 2009. China accounted for 61% while Japan accounted for 20% and Indonesia accounted for 4% of the global output expansion.

At purchasing power parity, the economic output of 79 markets contracted by $1.4 trillion during 2009. The United States was the largest victim accounting for 18% while Japan accounted for 17% and Russia accounted for 10% of the global output contraction. The economic output of 104 markets expanded by $1.5 trillion during 2009. China accounted for 56% while India accounted for 17% and Indonesia accounted for 3% of the global output expansion.

2010 – recovery

At exchange rates, the economic output of 148 markets expanded by $5.3 trillion during 2010. The five largest contributors to global output expansion are China at 17%, the United States at 10%, Brazil at 9%, Japan at 8%, and India at 5%. The economic output of 35 markets contracted by $338.5 billion during 2010. The five largest contributors to global output contraction are France at 22%, Italy at 18%, Spain at 17%, Venezuela at 10%, and Germany at 7%.

At purchasing power parity, the economic output of 169 markets expanded by $4.2 trillion during 2010. The five largest contributors to global output expansion are China at 25%, the United States at 13%, India at 10%, Japan at 5%, and Brazil at 4%. The economic output of 14 markets contracted by $17.8 billion during 2010. The five largest contributors to global output contraction are Greece at 67%, Venezuela at 19%, Romania at 5%, Haiti at 3%, and Croatia at 2%.

IMF's economic outlook for 2010 noted that banks faced a "wall" of maturing debt, which presents important risks for the normalization of credit conditions. There has been little progress in lengthening the maturity of their funding and, as a result, over $4 trillion in debt is due to be refinanced in the next 2 years.^[14]`

http://en.wikipedia.org/wiki/World_economy

World economy

2012-02-12T04:55:00.001-08:00

The world economy, or global economy, generally refers to the economy, which is based on economies of all of the world's countries, national economies. Also global economy can be seen as the economy of global society and national economies – as economies of local societies, making the global one. It can be evaluated in various kind of ways. For instance, depending on the model used, the valuation that is arrived at can be represented in a certain currency, such as 2006 US dollars or 2005 euros.

It is inseparable from the geography and ecology of Earth, and is therefore somewhat of a misnomer, since, while definitions and representations of the "world economy" vary widely, they must at a minimum exclude any consideration of resources or value based outside of the Earth. For example, while attempts could be made to calculate the value of currently unexploited mining opportunities in unclaimed territory in Antarctica, the same opportunities on Mars would not be considered a part of the world economy—even if currently exploited in some way—and could be considered of latent value only in the same way as uncreated intellectual property, such as a previously unconceived invention.

Beyond the minimum standard of concerning value in production, use, and exchange on the planet Earth, definitions, representations, models, and valuations of the world economy vary widely.

It is common to limit questions of the world economy exclusively to human economic activity, and the world economy is typically judged in monetary terms, even in cases in which there is no efficient market to help valuate certain goods or services, or in cases in which a lack of independent research or government cooperation makes establishing figures difficult. Typical examples are illegal drugs and other black market goods, which by any standard are a part of the world economy, but for which there is by definition no legal market of any kind.

However, even in cases in which there is a clear and efficient market to establish a monetary value, economists do not typically use the current or official exchange rate to translate the monetary units of this market into a single unit for the world economy, since exchange rates typically do not closely reflect worldwide value, for example in cases where the volume or price of transactions is closely regulated by the government.

Rather, market valuations in a local currency are typically translated to a single monetary unit using the idea of purchasing power. This is the method used below, which is used for estimating worldwide economic activity in terms of real US dollars or euros. However, the world economy can be evaluated and expressed in many more ways. It is unclear, for example, how many of the world's 6.8 billion people have most of their economic activity reflected in these valuations.

In 2011, the largest economies in the world with more than $2 trillion, €1.25 trillion by nominal GDP are the United States, China, Japan, Germany, France, the United Kingdom, Brazil, and Italy. The largest economies in the world with more than $2 trillion, €1.25 trillion by GDP (PPP) are the United States, China, Japan, India, Germany, Russia, the United Kingdom, Brazil, and France

http://en.wikipedia.org/wiki/World_economy .

Economyword

Ensuring Sustainable Development Is A Matter Of Human Decency: Jeffrey Sachs

Ensuring Sustainable Development Is A Matter Of Human Decency: Jeffrey Sachs

About The Author

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Australia's 2015 Economic Outlook

Australia's 2015 Economic Outlook

Australia’s Economic Forecast

Australia’s Industry Sectors

Australia’s Industry Sectors

Australia’s Export, Import & Trade

Australia’s Export, Import & Trade

Australia’s Economic Structure

Australia’s Economic Structure

Australia Economy

[edit] 2000 – 2010 – Rise of Developing and Emerging Economies

World economy

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