AFED Secretary General Talks about Green Jobs at ILO Conference in Kyoto
Kyoto, 5/12/2011 Secretary General of the Arab Forum for Environment and Development (AFED) Najib Saab addressed a special session entitled "Green Jobs for a Sustainable Future', at the 15th Asia and the Pacific Regional Meeting of the International Labor Organization onvened (ILO), which convened in Kyoto, (Japan) between 4-7 December 2011. The conference was opened by Prime Minister of Japan Yoshihiko Noda. The special session on Green Jobs was moderated by Ashok Khosla, President of IUCN and the Club of Rome. Here are Saab's main key points in the session.
1- The recent report of the Arab Forum for Environment and Development (AFED) about green economy, which coincided with the Arab Spring, focused on how green economy can help to navigate a sustainable transition in a changing Arab world. This change is hoped to usher in a new direction for economic, social and environmental sustainability. At the moment the prospects are gloomy across all three dimensions.
Economic sustainability will require reforms to clamp down on administrative corruption as well as the mismanagement of natural resources. With more representative governments, people whose lives are most impacted will have more say in shaping policy decisions.
One major demand which drove people to the streets was the plight for decent jobs. On this topic, a main finding of the AFED report is that transitioning to a green economy helps to generate decent and lasting job opportunities.
However this requires the transformation from the prevailing ‘virtual economy', primarily based on speculation in real estate and financial markets, to a ‘real economy' focusing on sustainable production, which alone can protect the natural capital and generate long term jobs.
2- Arab economies have underperformed over the past four decades. Arab countries have adopted aggressive economic growth models, but in doing so have gravely undermined progress on social and environmental issues. The shortfalls are not necessarily borne out of natural limitations, but are mainly the outcomes of policy choices.
Collectively, Arab economies have scored less than a 0.5% rise in real gross domestic product (GDP) per capita from 1980 to 2004. These figures cast doubt on the ability of Arab economies, as currently structured, to create 51 million new jobs, which is the number projected to be required by 2020, just to accommodate new entrants into the work labor force, while keeping current unemployment rates the same. Arab development strategies continue to be dominated by investments in extractive commodity products earmarked for export markets. These industries require high initial investments but generate low levels of employment. Despite generating high GDP growth, this model leaves Arab economies more vulnerable to global market volatilities, while failing to significantly create jobs. The lack of income diversification is a primary cause of the structural weakness of Arab economies.
3- Demographic transitions in the region are pivotal to future changes: Population has increased from 100 million in 1960 to 400 million in 2011. Sixty per cent of the population is under 25 years old. Urbanization has increased from 38 per cent in 1970 to 65 per cent in 2010, with almost 100 per cent urbanization in Gulf countries (GCC). The average rate of unemployment in Arab countries is currently about 10%, which is higher than developing countries. Youth unemployment rate averages at over 25%, double the average world rate, and the figure reaches 40% in some countries. Unemployed youth accounted for more than 70% of total unemployment in Egypt, Jordan and Yemen. Those constitute the bulk of demonstrators in Arab streets. Can Arab economies, as currently structured, create employment opportunities for the large number of job seekers over the next decade? 4- Why have Arab economies been unable to provide robust employment opportunities for job seekers, many of them educated? There are a number of reasons:
- Inability or unwillingness of Arab states since the 1970s to diversify their economies.
- Low levels of spending on R&D, the real engine of economic growth and new job creation.
- The absence of a regional economic block or market, or freer trade.
- Preference within countries of the GCC for low-cost, politically benign expatriate laborers.
- Neglecting investments in agricultural and industrial sectors.
- Pursuing investments in commodities and energy-intensive industries such as petrochemicals and aluminum that require high initial investments but generate low levels of employment.
- Lack of investments in green infrastructure such as public transportation, renewable energy, and sustainable agriculture.
- Pursuing fast wealth creation and profit making at the expense of social and environmental progress.
- Political corruption.
- The cultivation of a welfare state and a resulting lack of serious work ethics in some countries.
5- AFED REPORT FINDINGS: GREEN ECONOMY CREATES JOBS
Here are some key findings of AFED report, relating to expected effects of transitioning to the green economy on employment opportunities in selected sectors in Arab countries:
AGRICULTURE: Over the past two decades, the share of the labor force in the agricultural sector in the Arab region has declined from 44% to 29%. Increasing the share of workers in the agriculture sector to 40% would generate more than 10 million jobs in the sector (from 27.5 to 37.8 million). Given that 76% of the poor in the Arab region live in rural areas, the prospect of providing economic and social lift to rural and agricultural communities will contribute to promoting equity and stability. This requires shifting the trend from illiterate, informal and marginalized agricultural workers, to educated and skilled ones with formal work conditions.
Shifting to sustainable agricultural practices is expected to result in savings to Arab countries of between 5-6% of GDP as a result of increased water productivity and protected environmental resources. This amounts to US$114 billion annually.
If rural development does not become a priority, increased rural-to-urban migration in search of jobs will put even more strain on already inadequate infrastructure.
WATER: AFED report estimates that Arab countries will need to allocate at least 1.5% of their GDP annually to investments in clean sanitation, water infrastructure, innovative water efficiency, and recycling technologies in order to meet the expected rise in water demand. This amounts to US$28 billion annually. Such green investments will create jobs in both rural and urban regions.
ENERGY: Less than 3 million people in the Arab region are employed in the energy sector, representing about 3%of the total labor force. An investment of US$100 billion annually in renewable energy alone is expected to create about 565,000 new jobs. A reduction in average per capita consumption of electricity in Arab countries to the world average, through energy efficiency measures, would generate savings of $73 billion annually. A 25% reduction in energy subsidies would free up over $100 billion over a three year period, that can be shifted to green energy and millions of jobs.
BUILDINGS: A shift in subsidies on water and energy removes one of the key market distortions and provides an economic justification for green buildings in the housing market. Consequently, promoting green building practices will have far reaching implications not only on sustainable urban transformation but also on employment rates.
AFED report estimates that spending US$100 billion in greening only 20% of the existing building stock in the Arab countries over the next 10 years, by investing an average of US$10,000 per building for retrofitting, is expected to create 4 million jobs. The payback period for energy and water efficiency retrofits ranges between 2-7 years, based on the subsidy level.
It is estimated that the amount of spending on building and construction in Arab countries will reach US$116-233 billion in 2012. If Arab governments commit to greening the construction sector, spending will have to increase by at least 20% resulting in additional investments of between US$23-46 billion. These additional green investments will create 10% more green jobs.
WASTE MANAGEMENT: Investment needs in the waste management sector in Arab countries over the next 10 years in have been estimated at over US$21.6 billion annually, broken down as follows: collection and transfer (38%), land filling and composting (27%), mechanical and biological treatment (17%), dump upgrade or closure (12%), and waste-to-energy (6%).
Municipal solid waste management directly stimulates the economy because it is labor-intensive and requires investments in machinery and equipment for handling, transport, and processing. Developing a green MSW management sector contributes to job creation and stimulates demand for products, systems, and services in other industries including agriculture, manufacturing, construction, waste-to-energy, processing, transportation, retailing, and professional services. Increasing the rates of waste recycling leads to a large influx of new stable jobs, at a rate 10 to 20 times more jobs than landfilling or incineration.
TOURISM: Tourism has become an important sector in the economies of most Arab countries, contributing to economic diversification, job creation, and foreign exchange earnings. In 2010, the contribution of tourism to total employment in the Arab region was about 4%. However, adverse environmental and social effects tarnish the sector's economic achievements. Greening the tourism sector can boost earnings and create jobs.
A 12% higher share of international tourism in Arab countries is estimated to generate at least US$228 billion annually and an additional 5.6 million jobs, which would raise the sector's share of employment to 10%.
The willingness to pursue a green economy agenda provides a window of opportunity to initiate fundamental re-examination of current public policies in Arab countries. One of the main barriers to green transformation is the lack of knowledge within industry supply chains of green products, processes, materials, and services. Re-training programs will need to be developed for workers in all sectors. Respect for productive jobs should be restored, providing essential conditions to work with dignity. As the recent developments in Arab countries proved, sustainability cannot be a trade-off between freedom and dignity on one side and stability on the other. Finally, our discussion on green jobs today in Kyoto coincides with the climate change conference in Durban, where no binding agreement seems to be in sight regarding levels of emissions after phase 1 of Kyoto protocol expires in 2012. This is significant, as transitioning to the green economy is by large a big step to mitigate and adapt to climate change.
AFED 2011 report Green Economy: Sustainable Transition in a Changing Arab world can be downloaded from www.afedonline.org
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