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Sustainable economy through rational use of resources

Eugene Eteris, European Studies Faculty , RSU, Riga, 26.09.2011.Print version
Swiss’ Davos is famous for its World Economic Forum taking place each winter. However, the city’s conferences facilities are explored on different occasions throughout the year. Thus, at the Second World Resources Forum which took place in Davos recently (19 September 2011), Janez Potočnik, European Commissioner for Environment revealed the Union’s policy measures concerning sustainable economy and efficient use of natural resources.

The Commissioner’s presentation at the World Resources Forum was called “Resource challenges for Europe”. Below follow some extracts from the Commission’s speech published on his website – See: Reference: Speech/11/586, 19.09/2011.  

Pressure on environment

The world is evolving in many ways and both people and economies are evolving with it and adapting to the process. The era of plentiful and cheap resources is coming to an end. Raw materials, water, air, biodiversity and terrestrial, aquatic and marine ecosystems are all under pressure.

And this pressure will only continue to grow in the coming years. The world's population is increasing by around 200,000 people a day, and is likely to reach 9 billion by 2050. And many of these people rightly aspire to higher standards of living.


The same trends are visible in Europe presently: by 2050 demand for food, feed and fibre is forecast to increase by 70%. At the same time, about 60% of European ecosystems and natural resources providing background for development are already degraded, underlined the commissioner.


He added: “As we don't have another planet the only option we have is to find ways to live within its limits. We need to use our creativity and ingenuity to use limited resources more efficiently”.  


During XXth century, the world increased its fossil fuel use and extraction of material resources by a factor of ten, whereas, the world population only grew by four times; most of these resource was used in Europe and North America. In the EU, for instance, about 16 tones of materials per person is consumed each year, of which 6 tones become waste; then half of that is buried as landfill.


With a world population of 1,5bn 100 years ago this “consumptive model of growth, argued the Commissioner ,”was an acceptable phenomenon: it provided people with certain health standards, wellbeing and wealth”. But with a population of 7 or 9 billion it is no longer feasible; Europe cannot continue like this. “We need to call for radical change in the way we operate, in the way we produce and consume – basically – in the way we live”, EU Commissioner said.

Innovators and scientists: radical role

The Commissioner acknowledged a growing and an important role of scientists in giving form and shape to the sustainability process and help accelerate the progress in addressing this major challenge. Moving towards becoming a resource efficient society, the Commissioner added, was no longer a choice; it was an inevitable and the only possible outcome. 

“Our choice is whether to take the lead, define and shape this transition, or wait until we are forced to do it, when our critical resources will have been exhausted and adaptation will be difficult and expensive”, he said.

Clear vision

Being more efficient is not enough presently, given the trends in global resource use. The resource efficiency agenda is about “real or absolute decoupling”. That means reducing overall resource use with its impact on the economic activity, to sustainable levels, i.e. implementing the sustainable development concept.


The critical problem in Europe is that after centuries of resource-intensive growth, we are "locked-in" to resource inefficient structures, added the Commissioner hinting at the resource inefficient economic systems, business models and resource inefficient behavior, in general.  


Getting rid of the old-fashioned model, the EU needs new technologies with technological innovations in social systems, business models and behaviour.


It means, at the same time, providing incentives and support for innovation towards resource efficiency. The EU innovation strategy, e.g. in EU-2020 perspective, adopted in 2010, is aimed at providing innovation support and funding for projects addressing global and societal challenges.



There are huge potentials for increasing the efficiency of European resource through research and innovation. Research allows a better understanding of the complex world; providing technologies that can help accelerate the decisive societal and technological transition to an economy based on a sustainable relationship between nature and human well-being. R&D can make an important contribution to sustainability goals in a positive way.


Similarly, innovation can make an equally important contribution in bringing the enabling technologies to the market and to enhancing changes in the way people live, produce and consume.

Practical approach

As to the practical recommendations, the Commissioner suggested an introduction of the Roadmap for a Resource Efficient Europe.


The Roadmap is not only about resource productivity; it is aimed at reducing negative environmental impacts as well. The general roadmap’s objective is to decouple resource use and its impacts on growth. It is not just about technology; it is also about changing social-economic behaviour towards the concepts of “reducing, reusing and recycling”. The challenging strategy in the roadmap is towards European economy becoming more than a “service economy” but rather a dematerialized but not de-industrialised economy.


Resource efficiency has been always a very demanding and complex concept in the EU policies leading to fundamental changes in European production and consumption.

The new roadmap will provide all necessary means on the way to launching of a coherent, organised and irreversible process leading to a resource efficient future for the EU.

Radical transformation

As to the issue of transforming European resource-intensive economies into resource-efficient ones, the Commissioner suggested the following four main directions:


First, in order to change traditional behaviour in existing market economies, the EU-27 needs to use market signals, e.g. meaning, first of all, to use price mechanisms that reflect the real value of resources. That is why the Commission calls on the EU member states to make a shift in the tax base from jobs to resources and pollution.


Second, the EU must also get rid of subsidies that perpetuate inefficient and environmentally damaging consumption. It can no longer be feasible first to subsidise "dirty" economic behaviour, and then to finance the repairing of the damage.


Third, the EU policies must also encourage companies to develop sustainable products, services and processes; getting the prices right will encourage such innovation to a certain degree. In the old days, the companies found ways to improve labour productivity when labour costs were increasing and resources were cheap; no doubt, presently they will be creative and effective in increasing resource productivity as resource costs rise.


The EU shall actively support eco-innovation and eco-design through public policies. Stimulating demand for better products and services shall proceed through better labelling and better standards, through green public procurement and through more information on the life cycle impacts of existing and future products.

The research and business community has a big role to play in assessment of the environmental performance of production and products while managing it in a resource efficient way.


And fourth, the EU needs to focus on housing, transport and food. Around 80 per cent of our lifestyles’ impact – on resources as well as climate change – comes from these three important areas, including the energy used in these sectors.

Global case

The Commissioner believes that there is a global need for economic transformation moving humans towards resource efficient societies. Resource constraints, e.g. in water, energy and raw materials will not only be a potential brake on the development of many economies, but a threat to stability and peace. However by valuing the natural capital properly these countries could decrease the pressure on resources, boost innovateon and for those who have resources in abundance follow more beneficial development paths.


Resource scarcity is both a European and a global problem, and it requires a global response. The scale, complexity and trans-national nature of the changes needed make this clear.

Business & environment

The Rio+20 Summit in June 2012 will be the perfect venue to agree on the steps necessary to start a global transition to greener and resource-efficient economies. In this sphere, all states are interested in obtaining tangible and lasting results.


However, the EU-27, with the Commission’s assistance must give the private sector the confidence and predictability to invest into growth patterns that can do more with less, a society that derives more prosperity and wellbeing from knowledge and innovations.


Environmentally sound development today is more than choosing an alternative lifestyle; it is about setting changes in all our lifestyles.


Being a successful business today cannot be about cutting corners to get maximum short term returns. It has to be about adding value in sustainable ways in a longer term. Doing more with less becomes the competitive advantage in the 21st century, added the Commissioner.


Therefore, environmentalism and business today have a common cause and must work together. More than that, the EU environmental policy for the future must not just be about protecting the environment from business, but also about using business to protect the environment.

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