Green Economic Stimulus – Benefits, Challenges, and Implications for the Environment

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  • Background 

    Let us first talk about what is a “stimulus” and why is it needed

    A Stimulus is the economic monetary support offered by various Governments around the world to assist and prop up their economies and industries to recover from say the current adverse impacts of the pandemic and lock-downs…

    Then, what is “Green Economic Stimulus”?

    Read on…

     

    Green spending 

    We are all aware of the increased focus of Governments and communities on the global impact of climate change and taking the necessary steps to stop further environmental destruction. After all, environmental destruction in one part of the world has its impact all over the world thus making it truly a “global village”!

    It is estimated that out of a total of about US $ 15 trillion of stimulus spending announced globally since the pandemic began, about $ 2 trillion is being used to minimize the impact of pollution generating sectors, for example, transportation, energy, industry, farming and waste. Further, some countries are also supporting sectors that are climate-friendly such as renewable energies, electric vehicles and planting of more trees.

     

    Which Countries are making major green investments 

    Let us now take a look at some of the green investments done by countries around the world.

    Since Joe Biden took over as the President of the US last year, he has acted quickly on climate change and environmental protection, which has rapidly increased the country’s favorable ranking in green investments.

    Not to be left behind, Canada’s ranking in green investments also gained after the Justin Trudeau Government announced a series of funding for energy-efficient and ecosystem restoration sectors.

    Coming to Asia, Japan is ranked at the top after adopting measures designed to boost green energy and transport.

    China, though it continues to also grow its heavy industry, still saw its score improve owing to plans to expand wind and solar energy sectors.

    In summary 

    While we are seeing a welcome worldwide focus and momentum on pushing investments in green sectors, there is still a long way to go to truly focus all countries and citizens on taking concrete steps to minimize and ideally reverse the impacts of climate change. We are also seeing banks around the world taking steps to boost their lending to green sectors and minimize exposure to polluting fossil fuel industries.

    We do look forward to more and more action on a globally coordinated scale to slash planet-warming emissions and ultimately shift to a low-carbon economy in time to avoid catastrophic global warming.

    Time will tell…

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