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Report turns the spotlight on economics of green growth

Sir Paul Callaghan recently opined that New Zealand's strength lies in niche industries. And Pure Advantage, the organisation championing a move to a green growth economy, says what we need is decisive leadership in order to position the country for opportunities in such sustainable and innovative niches where we can have a natural competitive advantage. 

According to chairman Rob Morrison, the global value of potential commercial opportunities in the move to a green world economy is estimated to be up to $6 trillion a year by 2050.

As Pure Advantage trustee Sir Paul Callaghan notes: “With only 0.2 percent of the world's economy we can succeed in the niche markets of the world, growing businesses that are substantial in the New Zealand context. We have to think like Singapore, not as we have done for 150 years, as a country that can live off its natural resources.”

UK-based global consultancy Vivid Economic is currently preparing a macroeconomic report on New Zealand’s green growth opportunities in conjunction with Lord Stern of the London School of Economics, which says that all jobs in a low-carbon future will be greener in some way.

An executive summary released last week said: "While it may be tempting to focus on the share of output and jobs in green technologies, in reality New Zealand will continue to produce and consume many of the things produced and consumed now, but in more sustainable ways."

In measuring green growth, the authors write, it is vital to look closely at assets.

"Green growth strategies aim to maintain the stocks of important natural capital that humans depend on for survival, so that increases in living standards can continue into the future. If these strategies are successful, some of their most important benefits will be a high quality of environment and a more equitable distribution of the gains from growth.

"This means that, when measuring performance, it is necessary to look beyond growth. A first step is to account for changes in assets, and thereby to find out how much of observed growth is attributable to asset consumption or accretion."

Morrison says this should serve as a call to action.

“The report summary sends a clear message that New Zealand should embrace the green growth opportunity and capitalise on our  nimbleness and small size as leaders, not only in areas like low energy intensity farming and sustainable fisheries but also in new key green growth industries some of which are already making a global impact such as LanzaTech."

The report is due to be published and launched in March 2012. An outline is available here.