OECD Finds Environmental and Economic Reforms Not Adequately Linked

In a world with an increasing focus on the importance of environmental protection, many nations have acknowledged the need to link economic and economic reform measures. Unfortunately, according to the Organization of Economic Cooperation and Development (OECD), most countries still fail to link these two priorities comprehensively, leading to uneven results that generally favor money over environment.

In a world with an increasing focus on the importance of environmental protection, many nations have acknowledged the need to link economic and economic reform measures. Unfortunately, according to the Organization of Economic Cooperation and Development (OECD), most countries still fail to link these two priorities comprehensively, leading to uneven results that generally favor money over environment.

The study and its findings, reported by Business Green, found that while most countries have begun moving in the direction of green policies, governments undermine the effectiveness of their own policies by subsidizing fossil fuels and taxing some of the most polluting fuels at a low rate.

The OECD report set out to assess the progress of the OECD’s Green Growth Strategy, launched in 2011. The OECD hopes this progress report might stimulate countries’ adoption of green growth policies by identifying weaknesses in implementation and providing targeted, coherent policy advice.

To date, 42 nations have joined the OECD’s Green Growth Strategy, including Australia, Brazil and China. Roughly, one third of the OECD’s member countries also provided data for the Green Growth Strategy’s indicator framework, used to put together the report.

Although there has been some progress, the report noted, not one country had yet linked economic growth and environmental policy in an effective and meaningful manner. This leads to a “misalignment” of economic and environmental goals. For example, the world’s governments spend about US$640 billion per year on fossil fuel subsidies, and 33 out of 34 countries surveyed taxed diesel fuel at a lower rate than unleaded gas despite its larger contribution to air pollution.

According to Nathalie Girouard, head of environmental performance and information division, environment directorate at the OECD, these misaligned policy goals create “major hurdle to meaningful reform.” As a result, the most recent report recommends a range of measures designed to aid governments with accelerating green growth. These include embedding “environmental challenges at the heart of economic policy making, by linking environmental and economic reform priorities in a consistent set of objectives,” and increasing public support for environmentally-friendly reforms by doing more to address the social impacts of such reform.

A number of other analysts and political figures have recently weighed in on the issue of uniting environmental and economic reforms, including the Pope. Most argue that addressing climate change does not have to come at the expense of economic success and prosperity. A recent report from the Grantham Institute suggested that countries would benefit financially from almost any action designed to combat climate change.