Experts Debate: The Economy-Environment Relationship

RECENTLY World Media writer Jean Chichizola met for a discussion of development and the environment with Charles Carlisle, assistant to the director-general of the General Agreement on Tariffs and Trade; Nitin Desai, assistant to the secretary-general of the United Nations Conference on Environment and Development; and Gilles Schneider, secretary-general of the Club of Rome. The following are edited excerpts of that discussion:

Q: How do you define the idea of "sustainable development"?

Desai: I think there are three elements: one, a system of production which is capable of being continued without running aground for a lack of resources; second, responsibility in that those that produce are responsible for the consequences of their production; and third, and this often does not receive enough attention, a widening of options for poor households and poor countries.

Schneider: I feel quite embarrassed by this idea of "sustainable development" and to be clear, I am very much against it. This may be jargon for specialists, but certainly not for people at large. The role of the public is very important: No government will be able to act in the field of environment without public support.

Desai: But that is not a justification for rejecting the underlying idea. We need to get away from a situation where we think that development is doing one set of things, developing forests in one particular way, developing land in a particular way, and environmental management comes in afterwards to take care of the problems.

Carlisle: For me this idea of "sustainable development" is not a fad. I think it is possible to have economic development and to preserve and, ideally, enhance the environment. Modern technology will permit us to do that. The sad fact is that the great mass of the world's population lives in poverty. The world simply has to develop. There has to be economic progress if for no other reason but to take care of these people.

Q: What could "sustainable development" be in terms of concrete actions ?

Desai: Up to now, we have tended to focus a lot on production increases when we spoke about agriculture. This was typically the economic planners' approach. On the other hand you had the ecologist, who was focusing attention largely on the resources: the land, the water. But what got lost in both perceptions was people: the fact that the land is cultivated by farmers, that forest dwellers live in forests, that fisherman use waterways. We have to change the way we approach development, we have to move awa y from things to people.

Carlisle: You have to put prices on environmental resources. In the past we have treated them as free; the air is free, the water is free. Well, we cannot do this anymore.

Schneider: An example of what the real priorities of the environment are today is the greenhouse effect. It is striking that the present American administration has been refusing and not accepting the things that have been suggested by European countries and others. The United States is the country which has probably produced the most important part of the greenhouse effect.

Carlisle: I agree that we are not doing enough. But at least in some respects, and not just in the United States, we have been carrying out a significant degree of economic development at the same time that in a number of ways we have been improving the environment.

Q: Isn't it too late to think about gradual reform rather than radical measures ?

Desai: How can you stop deforestation on a global basis? It is a mistake to think that there is a quick fix. There is no substitute for the business of building up a way of sharing responsibility.

Schneider: It probably has to come both from the grass roots and institutions. Institutions are bureaucracies which have the disadvantage of slowing down change. We can maybe make them more effective by decentralizing.

Q: Is the protection of the environment for developed countries a way not to protect the environment, but their way of life and their markets ?

Carlisle: It is certainly true that industrial countries do protect their markets.... But I don't think this is directly related to environmental protection.

Schneider: Protectionism is not the main topic of confrontation between the North and the South in the field of environment. I think that the industrialized countries have built prosperity on industrialization without knowing about the environment; this is a rather recent awareness. The southern countries now resent that the industrial countries would like to export environmental norms to them.

Desai: Environmental trade could become an important issue in the 1990s, because of the high profile of environmental issues in the public consciousness. But I don't think it will be only a North-South issue; I think it could very well be a North-North issue. Trade restrictions are not necessarily a good instrument, because the source of environmental problems is not trade, but something else.

Q: Who should pay for the protection of the environment in the third world and in the Eastern [European] countries ?

Desai: Basically, the priority problems in most parts of the developing world are land and water related. And more in terms of the degradation of the quality of the resource; and not just from the perspective of environment but also from development. When your watershed deteriorates, the problem is not just soil runoff. The problem is that the farmer loses income and production. There is a synergy; in some ways it is easier if one had resources to tackle the problems in the developing world because what you need to do for better development is what you need to do for the environment.

Schneider: Most investments which are required are more than one country can afford. This has been true in Europe for many other good investments, in the aircraft or rocket areas, programs organized under the umbrella of the European Community. No one country could afford such investments.

Desai: I think one should look for new initiatives that will handle the financing part of this shared responsibility.... Something equivalent to a Eureka, which was directly targeted at key environmental issues. And a major initiative on building legal, institutional, and technical capacity, particularly in the developing countries. This could provide a foundation. Frankly, I find that in many cases industry is ahead of governments in their thinking, because they are looking ahead 10 or 15 years to what the regulatory system will be.

Q: But aren't governments supposed to pay for the protection of the environment in the third world, rather than companies?

Desai: Well, it depends. Many countries are bringing in legislation on air and water management. I don't think any country has solved this. Even in the developed countries, they have not solved the problem of small and medium enterprises and the environmental consequences of their actions, and I am not sure there are easy answers.

Q: Is it possible to say how much it will cost the North?

Desai: One of the things we have done in preparing for the Earth Summit is to negotiate a program of environment and development cooperation. There are programs of action, and there is a cost attached to these programs in terms of what it will cost for developing countries. We put in a figure for the type of support they would require over the remaining years of this decade, and that support amounts to less than 1 percent of the gross domestic product (GDP) of the industrial countries, or $125 billion.

Carlisle: The size of the global economy is $22 trillion. So your figure of $125 billion is just 1/2 of 1 percent of the global economy. Incidentally, according to figures from the Organization for Economic Cooperation and Development, in OECD countries, pollution abatement has generally run from 4/5 of 1 percent to 1.5 percent of GDP.

Q: What are you expecting for the Rio Conference ?

Desai: Many people talk of the Earth Summit as a last chance. I see it quite differently, as a first step. What you have been seeing over the past two years is how barriers have been breaking down between disciplines, sectors, and countries. I see today a greater willingness to accept this reality of a shared habitation than I saw two years ago and that is why I am optimistic.

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