1. Empowered lives.
Resilient nations.
Sustainability, equity, and the
green economy: Implications
for Croatia
Ben Slay
Senior economist
UNDP Bureau for Europe and CIS

2. Rio+20
“Three birds with
one stone”

3. Key messages: Global
• World has made major progress in past two decades . . .
• . . . But this progress is increasingly threatened by
unsustainable environment policies and practices
– Key manifestation: failing ecosystem services
– Key causes:
• Over-exploitation of common property resources
• Population growth
• Consumerist aspirations of global middle class
• Environmental sustainability and equity are closely linked
– Sustainability is about inter-generational equity . . .
• . . . But what about intra-generational equity?
• More equal societies have better development indicators
– “Double burden”: Many of the world’s poor bear environmental
risks as well as income poverty,
• These issues will be taken up at UNCSD in Rio (June 2012)

4. Sustainable development
and the green economy
The three “pillars” of sustainable human development
• 1992 Rio earth summit
popularized “three pillar”
model
Economic: • Is green growth the
Issue of traditional growth based on high
use of energy intersection of:
energy pricing, regulation, direct
government activities
– Economic and
environmental pillars?
– All three pillars?
Social • Developing countries are
Environmental
Inclusion, access to resources,
green jobs, health, education – Biodiversity, water, food, energy,
suspicious of the green
good governance
climate change impact economy because it may
leave out the social pillar
• Are green growth, inclusive
growth different?
Solutions that are compatible across all three strands

5. Key messages: Regional
• New EU member
states, Western
Balkans, former Soviet
republics compare well
with other regions . . .
• . . . But there are causes
for concern as well:
– Relatively high levels of
energy inefficiency
• Good examples: energy
efficiency in Croatia
– Highlighted in
Development and
Transition
• Concrete examples of
how UNDP can help

6. Possible consequences
of environmental unsustainability
Human development index:
Per-capita GNI, life
expectancy, years of
education

7. The world is warming
Sea levels: Rising
Natural disasters:
Average annual
number has doubled in
last 25 years
Greatest impact born
by low HDI countries
• Greatest forest cover losses
(11% since 1990)
• Poorest households, countries
can not afford to reforest

8. Precipitation patterns changing
Avg. value,
1951 - 1980
Avg. value, 2000s

9. “Double burden” of income poverty,
poor access to resources
Poor households are likely to:
90%
80%
Form of
• cook with wood, dung
deprivation • not have access to improved
water, sanitation services
35%
Multiple deprivations:
• 80% of poor households
experience two or more
deprivations
Modern Sanitation Water • 29% face all three
cooking
fuels
Particular burden on women

10. How much finance is needed?
• For climate change mitigation, adaptation:
– Estimates are uncertain . . .
– . . . Ranging from $500 billion to $2
trillion, annually
• For water and sanitation: $60 billion
annually
• Most of this must come from private
sector . . .
– . . . But how effective are carbon markets?

11. Public finance and climate change
• ODA needed to:
– Leverage carbon markets
– Promote market deepening by reducing:
• Risks
• Transactions costs
• Financial transactions tax?
– EU has pledged to introduce
this in 2012 . . .
– . . . But not necessarily for
development, or carbon
finance

12. How much finance is coming?
• Copenhagen summit (2009):
―Green climate fund‖
• Developed countries are to
provide $100 billion annually in
climate finance for developing
countries by 2020
• ―New, additional monies‖
• 2010: $97 billion in carbon
finance flows
• $93 billion—mitigation
• Private sector: $55 billion
• ODA:
• $39 billion—mostly via
development banks . . .
•. . . Most not ―new and additional‖
• Carbon markets: ―only‖
provided $2.3 billion
Source: The Economist (5 November 2011)

13. Rio + 20—Issues
• Financing the
transition to low-
carbon growth?
• MDGs after 2015?
• Sustainable
development
goals?
• Reform of global
environmental
governance?
• Binding emissions
targets?

14. Regional dimension: High/very
high HDI levels
OECD countries (2004 new EU
member states), Croatia
Moldova, Central Asia
(except Kazakhstan)
Human development
index: Per-capita GNI, life
expectancy, years of
Russia, other Former Soviet education
republics, Southeast Europe

15. Forest cover is returning
2%
1%
Asia, Pacific Europe, Central Asia Arab states
Latin America, Caribbean
Sub-Sahara Africa
Change in square
kilometres of forest
coverage, 1990-2010 -8%
-10%
-12%

16. Greenhouse gases—many
transition economies still outliers
1.7
1.6 1.6 Tons of CO2 equivalent emitted
per $1 of GDP (2008)
1.0
0.5
0.2 0.2
0.1 0.1
UNFCCC, IMF data; UNDP calculations.

17. But: many European transition
economies beat the global average
0.5
Tons of CO2 equivalent emitted
per $1 of GDP (2008)
0.4
0.3 0.3
0.3 0.3
0.2
Global Slovakia Croatia Armenia Lithuania Albania Latvia
UNFCCC, IMF data; UNDP calculations.

18. Carbon finance: Not coming
Joint implementation Clean development
projects approved* mechanism projects
400 approved* 212
Europe and Central Asia Europe and Central Asia
Rest of the world Rest of the world
*As of 31 August 2011
John O’Brien, “Carbon finance: Opportunities and reality”, Development and Transition

19. Carbon finance: What
is to be done?
• Reduce high transactions
costs for projects, by:
– Accelerating project
approval
– Increasing project size
– “Bundling”
• Capacity development for:
– Designated national
authorities
– Private companies in:
• Energy efficiency
• Renewables
– Project beneficiaries

20. UNDP can help—Croatia
• UNDP, Global Environmental Facility programme on
public-sector energy efficiency
• Results (2006-2010):
– Energy systems in 5900 public buildings refitted
– Energy audits conducted in 1346 public buildings
– $18 million in initial annual public-sector energy
savings
– Annual CO2 emissions reduced by 63,000 tons
– “Energy charter” signed by all 127 municipalities
– 17 new companies, 150 energy efficiency expert jobs
created
– $4 million in UNDP-GEF funding leveraged $30 million
in additional investment
Louisa Vinton, “Going green with Gašpar”, Development and Transition

21. • UNDP’s regional research
bulletin, for Europe and
Central Asia
• Provides UN, independent
views on
development, transition, p
olicy, programming
• Disseminates lessons of
successful UN projects
• Distributed to:
– All UNDP staff in
Europe, Central Asia region
– 3000 external subscribers
www.developmentandtransition.net

22. Food for thought
• EU accession  “20/20/20” policy:
– Reduce primary energy use by 20%
– Reduce greenhouse gas emissions by 20%
– Increase share of renewables in energy mix to 20%
– By 2020
• EU countries that are furthest along in this
respect have:
– Energy prices high enough to encourage renewables
– Feed-in tariff regimes that work