Tackling climate change

Secretary-General of the OECD

©OECD Observer

A 50% rise in global greenhouse gas emissions by 2050, higher temperatures, with more droughts and storms harming people, crops and buildings; more animal and plant species becoming extinct under expanding farmland and urban sprawl; dwindling natural resources; a billion more people living in water-stressed areas by 2030, with more pollution, disease and premature deaths ahead.
Fortunately, there is a far brighter prospect the OECD can foresee, which the world’s environment ministers will focus on at the important OECD ministerial conference in April: we can overcome the environmental challenges we face as the necessary policies and solutions are available, achievable and affordable, especially compared with the projected accumulation of wealth and with the costs of inaction.But we need to act now not only out of environmental concerns but also purely for economic reasons. Take the new investments in energy infrastructures that are set to take place in emerging and developed countries over the next decade. By acting now, we can ensure that these projects lock in the right fuel, technology and efficiency standards. A rare window of opportunity to get this right is now open and we must use it to avoid far costlier investments later on.The figures are compelling. Our experts believe that if we can live with a 98% increase in global GDP from now to 2030, instead of 99% in our “business as usual” baseline scenario, the improvements in air and water quality would be considerable. Foregoing that single percentage point would bring us some way towards reducing greenhouse gas emissions. A percentage point over a quarter century is not a high price to pay–call it the cost of an insurance premium. Not cheap, but affordable.How do we achieve that necessary investment? Our 2008 Environmental Outlook, published in March, builds on several decades of environmental analysis and expertise by the OECD. It examines the economic and environmental topics from every angle, developing model-based analyses and drawing on expertise from other organisations and national agencies in the OECD and beyond.Our message is simple: with the size of the world economy expected to double by 2030, we must move to a low-carbon, greener growth path. We have to design policy mixes that are able to respond to new circumstances.Market-based instruments must be given more space in the mix because they can lower the cost of action. After all, if economic activities cause environmental degradation, then economic tools must form a key part of the solution. Market-based instruments are the lynchpin in the policy mix, but will need to be complemented by stronger regulations and standards, R&D and further technological developments, eco-labelling and education to overcome some of the information gaps and market failures hampering action.Policymakers should focus on taxing the “bad” instead of subsidising the good and on creating the virtuous circle that produces positive externalities. Although some subsidies may be needed, say, to support basic R&D, removing environmentally harmful subsidies, particularly for fossil fuels and agricultural production, should be a priority to reduce pollution and stress on our natural resources. There are other economic instruments, including emissions trading and taxes, that could help us put the right price on the source of the problem: carbon. Restructuring the global economy along low-carbon lines will require concerted policy action and leadership. It will require the engagement of all actors and the inclusion of all sectors. It will also require more co-operation among different ministries and among different stakeholders from business, labour and civil society.People are ready to change. Many are in fact leading the way! But the transition nonetheless needs to be carefully managed to address social and competitiveness issues. Otherwise, important policy action will not be agreed or implemented. We must also prepare our economies to take advantage of new eco-innovative opportunities.Climate change is mankind’s main long-term challenge and the global cost of action will be lower if all countries work together to share the burden fairly. OECD countries must work closely with major players such as Brazil, China, India, Indonesia, South Africa and Russia, alongside other developing countries. Acting now is not just about avoiding problems ahead. It is about building a better global economy. That is our goal and we must start right away.©OECD Observer No 266, March 2008


Economic data

GDP growth: +0.6% Q3 2017 year-on-year
Consumer price inflation: 2.3% Sept 2017 annual
Trade: +4.3% exp, +4.3% imp, Q3 2017
Unemployment: 5.7% Sept 2017
Last update: 14 Nov 2017

E-Newsletter

Stay up-to-date with the latest news from the OECD by signing up for our e-newsletter :

Twitter feed

Suscribe now

<b>Subscribe now!</b>

To receive your exclusive paper editions delivered to you directly


Online edition
Previous editions

Don't miss

  • Rousseau
  • Do you trust your government? The OECD’s How's life 2017 report finds that only 38% of people in OECD countries trust their government. How can we improve our old "Social contract?" Read more.
  • Papers show “past coming back to haunt us”: OECD Secretary-General Angel Gurria tells Sky News that the so-called "Paradise Papers" show a past coming back to haunt us, but one which is now being dismantled. Please watch the video.
  • The annual OECD Eurasia Week takes place in Almaty, Kazakhstan 23-25 October. Writing in The Astana Times, OECD Secretary-General Angel Gurría urges Eurasia countries to stay the course on openness and international integration, which has brought prosperity but also disillusionment, notably regarding inequality. The OECD is working with this key region, and Mr Gurría urges Eurasia to focus on human capital and innovation to enhance productivity and people’s well-being. Read more.
  • When someone asks me to describe an ideal girl, in my head, she is a person who is physically and mentally independent, brave to speak her mind, treated with respect just like she treats others, and inspiring to herself and others. But I know that the reality is still so much different. By Alda, 18, on International Day of the Girl. Read more.
  • Globalisation’s many benefits have been unequally shared, and public policy has struggled to keep up with a rapidly-shifting world. The OECD is working alongside governments and international organisations to help improve and harness the gains while tackling the root causes of inequality, and ensuring a level playing field globally. Please watch.
  • Read some of the insightful remarks made at OECD Forum 2017, held on 6-7 June. OECD Forum kick-started events with a focus on inclusive growth, digitalisation, and trust, under the overall theme of Bridging Divides.
  • Checking out the job situation with the OECD scoreboard of labour market performances: do you want to know how your country compares with neighbours and competitors on income levels or employment?
  • Trade is an important point of focus in today’s international economy. This video presents facts and statistics from OECD’s most recent publications on this topic.
  • How do the largest community of British expats living in Spain feel about Brexit? Britons living in Orihuela Costa, Alicante give their views.
  • Brexit is taking up Europe's energy and focus, according to OECD Secretary-General Angel Gurría. Watch video.
  • OECD Chief Economist Catherine Mann and former Bank of England Governor Mervyn King discuss the economic merits of a US border adjustment tax and the outlook for US economic growth.
  • The OECD Gender Initiative examines existing barriers to gender equality in education, employment, and entrepreneurship. The gender portal monitors the progress made by governments to promote gender equality in both OECD and non-OECD countries and provides good practices based on analytical tools and reliable data.
  • Interested in a career in Paris at the OECD? The OECD is a major international organisation, with a mission to build better policies for better lives. With our hub based in one of the world's global cities and offices across continents, find out more at www.oecd.org/careers .

Most Popular Articles

OECD Insights Blog

NOTE: All signed articles in the OECD Observer express the opinions of the authors
and do not necessarily represent the official views of OECD member countries.

All rights reserved. OECD 2017