Pandemic offers MENA a window of opportunity for green economy

LONDON–In the past, economic crises such as the oil crises of the 1970s and the 2008-2009 financial crisis have led to temporary reductions in greenhouse emissions. It thus stands to reason that the COVID-19 crisis will also be a chance to move the economy in a “green” direction.

But while the earlier crises did not lead to a long-term decrease in emissions, there is hope that following the COVID-19 pandemic, which has already seen emissions fall by 17%, there will be increased momentum for green economic recovery with a view towards a zero-carbon future.

A World Bank Study revealed that MENA is home to several of the world’s most air-polluted cities, which leads to the loss of some 100,000 lives each year. Decreasing emissions would therefore not only improve the global climate, but boost air quality and in turn human health and wellbeing.

Damage caused by high air pollution can also cause economic problems, with over $9 billion in losses to annual labour income in the MENA region.

COVID-19 should be viewed as a lesson in the merit of prevention over treatment. The cost of inaction in the face of a steadily warming climate is far higher than the cost of taking action once those changes take place, even before considering their indirect implications. Once factoring in the exonic and health costs of air pollution, the need to take steady action is even more clear.

With green recovery, growth and jobs are expected to follow. Findings by economists from academia, finance ministries and central banks, including those published in the University of Oxford’s Smith School of Enterprise and the Environment by Cameron Hepburn, Brian O’Callaghan, Nicholas Stern, Joseph Stiglitz and Dimitri Zenghelisin in a study titled “Will COVID-19 fiscal recovery packages accelerate or retard progress of climate change?”show that combining COVID-19 recovery tactics with climate crises solutions is the most effective way to both grow the economy and protect the environment.

As opposed to business-as-usual “brown growth” — economic development that is heavily reliant on fossil fuels — green recovery strategies lead to a higher economic multiplier.

Examples of policies put forward by Hepburn include clean energy production, integrated land management systems, investment in natural capital for terrestrial and marine and coastal ecosystem resilience, sustainable agriculture, restoration of carbon rich habitats and resource efficiency.

The end result of these policies is potential to create sustainable long-term growth while short-term benefits include more net jobs. The New Climate Economy report, the flagship project of the Global Commission on the Economy and Climate, estimated that old brown jobs lost will rapidly be offset by new green jobs if a global green growth path is taken. An estimated 28 million jobs for high-carbon activities, including supplying electricity and gas, fuel manufacturing and coal will be lost, while over 65 million jobs will be available in low-carbon activities by 2030.

Despite the economic chaos it has wrought, the COVID-19 pandemic has offered a window of opportunity for a new green economy, which is on its way to being the economy of the future.

Green fiscal stimulus would not only serve as an economic boost providing increased labour demand, but will also build foundations that will lead to a strong growth performance for MENA countries.