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| Economics, trade and investment facts and key issues |
Facts | Key issues
Facts
- The world economy has, on aggregate, expanded considerably over the past 30 years. Despite fluctuations, world GNP has more than doubled (UNEP (2002), Global Environmental Outlook - 3, Earthscan). Trade and investment liberalisation - the movements of goods, services and businesses between countries - has been an engine of economic expansion over the past 50 years, growing 14 times. WTO (1998) WTO Annual Report 1998 - International Trade Statistics, WTO, Geneva.
- The benefits of economic expansion have been considerable - but costly in terms of the world's natural resources. Since 1970, freshwater species have declined by 50 per cent, marine species by 30 per cent, and forest species by 10 per cent. WWF (2002), Living Planet Index
- Economic expansion has brought about a massive increase in greenhouse gas emissions impacting on the climate. Global energy use has increased by more than 70 per cent in the last 30 years. UNEP (2002), Global Environmental Outlook - 3, Earthscan
- The past 30 years have also witnessed growing inequality and poverty. Since 1970 the ratio of income of the richest 20 per cent to the poorest 20 per cent has increased from 30:1 to 78:1, and as many as 1.3 billion people now live in abject poverty. World Bank (1997), World Development Indicators, World Bank, Washington D.C
- Today, 60 per cent of the poorest live in environmentally degraded areas WWF-UK (1998), Poverty and the Environment: Facing the real issues, WWF-UK, Godalming, Surrey, UK
- The growth in CO2 emissions mirrors the growth in transporting goods and services as a result of increased trade. Trade also has direct environmental and social impacts in natural resource-based sectors such as agriculture, forestry, fishing, mining and energy.
- In 1997 agricultural products represented 10.9 per cent of the global trade in merchandise and 49.2 per cent of global trade in primary products. World Trade Organisation. Annual Report: 1998, International Trade Statistics. WTO:1998
- Agriculture is a critical sector in terms of people's livelihoods and the environment. Its expansion affects water quantity and quality through the use of fertilisers and pesticides. This leads to soil erosion and loss of topsoil caused by farming on marginal lands, tillage and other cultivation practices.
- International trade in forest products has been increasing rapidly since 1970, with exports more than doubling. International trade now accounts for 25 per cent of global production of wood-based panels and paper, and 20 per cent of sawn wood. At the same time, forests have been disappearing at an alarming rate - commercial logging now affects 70 per cent of old growth forests. Tim Rice, Saskia Uzinga, Chantal Mrijnissen, Mark Gregory. Trade Liberalisation and its Impacts on Forests: An Overview of the Most Relevant Issues. FERN. November 2000.
- Annually, between 35 and 40 per cent of fisheries production is traded internationally, with 80 per cent imported to developed countries where demand is growing rapidly. Environmental and social matters associated with marine issues include the depletion of natural resources: more than 70 per cent of fish stocks are either fully exploited or over-exploited (FAO), not least through incidental by-catch.
Key issues
- Social change
Development has become synonymous with increases in consumption. A cultural preference for this type of development, promoted by the West, has become widespread. This influences the make-up of society and, through its desire for greater consumption, the exploitation of natural resources.
- Markets
National and international markets have an enormous influence on countries' production patterns and resource use more generally, particularly as they move (or are moved) towards more market-oriented strategies. Market expansion has caused major shifts in the composition and location of production and consumption activities, and has reshaped the way millions of people earn their living and the way societies are organised. These have serious consequences for the environment.
- International governance
Multilateral organisations, such as the World Bank and the World Trade Organisation, encourage countries to adopt market-oriented policies through a range of tools and instruments such as Structural Adjustment Programmes. There is a fear among many countries, and in civil society, that such policies may not benefit the poor or the environment. The lack of market opportunities in the poorest countries means they have to mine and export their natural resources.
- National government policies and institutions
Government policies at the national level can have a devastating impact on the natural environment - in particular through "perverse policies" which offer economic incentives such as tax breaks to cut down forests. Governments promote public policies which fail to incorporate environmental values into the decision-making processes and therefore cause environmental degradation.
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WWF-UK > Research > Issues > Economics > Facts and key issues
