During the industrialisation of what are now developed countries, there has been a close correlation between economic growth and environmental degradation. As communities grow, the environment seems to suffer and decline. This trend is clearly demonstrated by graphs that correlate human population numbers, economic growth and environmental indicators. Resources such as water and air, and biodiversity, which are taken for granted, are in fact limited. The world is being increasingly faced with water scarcity, severe air pollution, resource depletion and all the negative impacts of climate change, such as extreme weather events and failing crops. The negative impact of human progress on the environment is frequently discussed by scientists, politicians and the media. However, what is very often not discussed is how to assist developing countries to take a growth path with less of a negative impact, or how to help territories in developing countries to cope with the changes.

This is a big challenge for national and subnational economies in developed and even more so in developing countries and for the enterprises operating there. How do we respond to these challenges? How do we become resilient and protect against negative impacts? How do we take advantage of new opportunities that may emerge? There are many competing hypotheses about what should be done, and many unanswered questions on how developing countries will be affected by global changes. This makes the whole situation very complex indeed.

In order to de-clutter the complex topic of green economic development, in the eleven articles in this publication we have tried to look at it from different angles and in a holistic way. In this regard we have benefited from the fact that all six partners who have co-authored this publication have had the chance to work with their clients in different parts of the world on specific aspects of green economic development in recent years. Among others this work includes

  • The elaboration of the concepts of green local economic development (LED) and climate-smart locations in the Philippines
  • The facilitation of the strategy development for the Business Innovation Hub and Science Park in Botswana, with the emphasis on development that will enhance the environment
  • Working with the Skills for Green Jobs project in South Africa which focuses on technological capability building in green technology development and adaptation
  • Helping partners in Costa Rica to develop an explicitly green concept of LED
  • The organisation of green study tours in Germany for participants from developing countries
  • The ongoing research by several partners on complexity and how it relates to green economic development.

We have dedicated our Annual Reflection 2016 publication to a topic that is high on the development agenda and which will increasingly gain more relevance and importance, namely green economic development.

In the first article of this Annual Reflection we define what we understand by green economic development. This is followed in the next article by a discussion of the trade-offs between green and other relevant development topics in the light of our understanding that economies are complex evolutionary systems. Article 3 debates how such an evolutionary process in a given country or territory can be influenced and how the system’s evolutionary path can be changed to become more environmentally conscious. Article 4 describes the ideal nature of the business environment and the archetypes of instruments potentially available to direct economic actors in an ecologically sensitive direction. Article 5 looks at (green) industrial policy from the bottom up: how to introduce a green economy (or elements thereof) from the bottom up, how to work from where you are, harness the energy and momentum, and lay the foundations. This requires responsive and forward-looking meso institutions. However, the meta level is equally important for a green transformation process, as it requires a shift in the mindset of people in very different societies around the globe (see Article 6).

Article 7 looks at different pathways for countries to phase in green technologies with a specific emphasis on the role of voluntary standards designed and agreed upon by businesses.  Article 8 discusses the empirical experience during green innovation study tours of possible driving forces for greening urban and rural locations in the European Union. Learning and innovation requirements are analysed in Article 9.  Enhancing territorial competitiveness is the focus of Article 10, which considers ways to assign costs to the use of eco-system services in order to ultimately maintain healthy ecosystems. Article 11 concludes the discussion of green economic development by addressing one of the most advanced concepts of eco-efficiency: circular economic systems.

Although this publication has tried to look at green economic development in a holistic way, we are aware that it has not dealt with the topic in all its richness and diversity. However, this is neither possible nor necessary within the frame of our Annual Reflection: it is rather our intention to stress the importance of the topic for our work and for the mandate of our clients and to map out what we have learned in recent years with regard to relevant questions and possible answers for sustainable economies.

If you would like to engage us on this topic, email Christian Schoen or Frank Wältring.

The meta level of greening territorial economies in times of climate change  
The transformation to a green economy is more than a purely technical issue. It requires a shift in the mindset of people in very different societies around the globe  
Bottom-up industrial policy at territorial level  
We are being increasingly approached to assist cities and large towns with bottom-up innovation and industrial policies in developing countries.  
Shaping a climate smart and eco-friendly business environment  
Adjusting the business environment of a country or territory to the new realities of climate change and environmental degradation is a complex and long-term process.  
Green economic development as an evolutionary process  
To understand how to influence economic development in a territory to make it “greener”, one needs to appreciate how change happens in the economy in general.  
Competing priorities: trade-offs between "green" and other topics  
Different development programmes have different priorities and goals. Some promote economic development, competitiveness and growth. Some promote green economic development. Some focus on poverty reduction and the inclusiveness of growth. Again others’ objectives are to promote…  
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