Economic growth means an increase in GDP. Therefore, with increased output and consumption we are likely to see costs imposed on the environment. The environmental impact of economic growth includes the increased consumption of non-renewable resources, higher levels of pollution, global warming and the potential loss of environmental habitats.
However, not all forms of economic growth cause damage to the environment. With rising real incomes, individuals have a greater ability to devote resources to protecting the environment and mitigate the harmful effects of pollution. Also, economic growth caused by improved technology can enable higher output with less pollution.
The pace of global economic growth in the past century has led to a decline in the availability of natural resources such as forests,
A decline in sources of oil/coal/gas
Loss of fishing stocks – due to overfishing
Loss of species diversity – damage to natural resources has led to species extinction.
External costs of economic growth
Pollution. Increased consumption of fossil fuels can lead to immediate problems such as poor air quality and soot. Some of the worst problems of burning fossil fuels have been mitigated by Clean Air Acts which limit the burning of coal in city centres. Showing that economic growth can be consistent with reducing a certain type of pollution.
Damage to nature. Air/land/water pollution causes health problems and can damage the productivity of land and seas.
Global warming and volatile weather. Global warming leads to rising sea levels, volatile weather patterns and could cause significant economic costs
Soil erosion. Deforestation resulting from economic development damages soil and makes areas more prone to drought.
Loss of biodiversity. Economic growth leads to resource depletion and loss of biodiversity. This could harm future ‘carrying capacity of ecological systems’ for the economy. Though there is uncertainty about the extent of this cost as the benefit of lost genetic maps may never be known.
Long-term toxins. Economic growth creates long-term waste and toxins, which may have unknown consequences. For example, economic growth has led to increased use of plastic, which when disposed of do not degrade. So there is an ever-increasing stock of plastic in the seas and environment – which is both unsightly but also damaging to wildlife.
Urgent change is needed now
The need to address the climate crisis is well established. Adding to an already detailed body of climate research, the 2021 IPCC Report from the UN makes clear the critical need for immediate and drastic climate action, and highlights the indisputable link between climate change and human activity.
The science is clear: to minimize the damage and avoid reaching an irreversible tipping point, we need to limit global warming to 1.5°C above pre-industrial levels. The 2021 UN IPCC Report reiterates that collectively, we need to halve global greenhouse gas emissions by 2030 and reach net zero before 2050. But even with the reductions achieved in 2020 due to the pandemic (the most since World War II) the world is forecast to miss its annual targets.
It is evident that we need transformational changes to address the climate crisis - a transformation that will rely on technology, innovation, and cross-industry collaboration.
The role of digitalization in climate action
Working within the technology sector, we have the chance to use our specialist expertise to help achieve the Sustainable Development Goals (SDGs) while moving towards a low-carbon economy, a move that is central to meeting the Goal, which focuses on combating climate change and its impacts.
Cellular connectivity is a crucial enabler
Technologies such as 5G, AI and IoT are being utilized today as essential drivers of decarbonization. But the real change will start to happen when enterprises switch to cellular connectivity. Here are just some examples of how cellular connectivity will accelerate sustainable development.
Manufacturing
When factories cut the cables and switch to cellular, they become much more flexible and produce less waste, while increasing productivity.
Renewable energy
According to the UN, 85% of power in 2050 will need to come from renewable sources. This will mean a huge transformation for energy operators and distributors who will need greater visibility and control of their distribution networks. With 5G, these operators can connect smart meters to the grid and proactively detect faults and demand spikes that might arise, for example, from the mass charging of electric vehicles.
Transport
The transport sector is another area where digitalization can have a big impact, with the sector representing 21% of total global emissions.5G and data analytics are going to be an integral part of this equation especially when it comes to operating autonomous vehicles on a massive scale. 5G, for example, will enable operators to control large fleets of autonomous vehicles remotely and optimize route planning and traffic, all with reduced operational costs and environmental footprint.
The battle against climate change can’t be fought alone. It’s only through the use of technology and innovation across all sectors of society, along with the right policy mix and concrete climate action.
Strategic policy and investment decisions supporting the transition to a pathway of low-carbon, sustainable growth could lead to direct economic gains.
Many of the decisions ultimately shaping the next 10 to 15 years will be made in the next 2 to 3 years, so we must act now to seize not only the economic, but also the social and environmental benefits of low-carbon and resilient growth. Focusing on the structural transformation in 5 key economic systems: energy, cities, food and land use, water, and industry, will provide the greatest potential for growth and the greatest possibility to reduce the risks of climate change.
Priorities for urgent action are:
Accelerating investment in sustainable infrastructure, supported by clear national and sub-national strategies and programs.
Harnessing the power of the private sector, including to unleash innovation and advance supply chain transparency.
Ensuring a people-centered approach, such that the gains are shared equitably and the transition is just.
Clean energy systems, smarter urban development, sustainable land use, wise water management, and a circular industrial economy are essential pieces to the puzzle. By 2030, ambitious action across these systems could generate over 65 million new low-carbon jobs, avoid over 700,000 premature deaths from air pollution, raise US$2.8 trillion in carbon price revenues and fossil fuel subsidy savings to reinvest in public priorities, increase female employment and labor participation, and lead to higher global GDP growth.
To achieve the benefits of this new growth approach and shift the world economy on to a more stable climate pathway, economic decision makers in both public and private sectors must take several steps:
First, governments should put a price on carbon and move toward mandatory climate risk disclosure for major investors and companies.
Second, all economies should place much greater emphasis on investing in sustainable infrastructure as a central driver of the new growth approach.
Third, the full power of the private sector and innovation needs to be harnessed.
Fourth, a people-centered approach is needed to ensure lasting, equitable growth and a just transition.
Recognizing that significant technological and market progress driving the shift to a new climate economy has been achieved over the last decade, The 2018 Report of the Global Commission on the Economy and Climate aims to motivate further action by economic and financial leaders in government and the private sector by highlighting the benefits of transitioning to a new growth path, identifying potential challenges, and defining actions to reap the benefits of stronger, cleaner, and more equitable growth.
Our approach to environmental sustainability
