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POLITICAL ECONOMY
Outside View: U.N. message at Rio+20
by Alan Oxley
Rio De Janeiro (UPI) Jun 26, 2012


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The U.N. conference on sustainable development that concluded in Rio de Janeiro last week has decisively rejected calls by green activists to shrink the world economy. This aligns with commitments made coming out of the Group of Eight summit in Maryland in May where leaders promoted food security and agriculture investment.

Green groups like World Wide Fund for Nature and Greenpeace declared the Rio meeting a failure.

On the contrary, it was a rare success for finding agreement among U.N. members on how to advance environmental standards in ways that do not reduce economic growth.

It produced a lengthy declaration which addressed almost every major environmental issue on the global landscape. All of these problems are difficult. For each, a deliberate approach to address it was laid out.

It is pointless to advance measures which reduce economic growth as Green groups do. This is why the Copenhagen climate conference failed.

Yet unemployment, debt and failing economies are simply an inconvenience to environmental activists.

As they see it the planet is on the precipice of disaster -- too many people, too much consumption and too much production. For rational observers this is, of course, beyond absurd.

The last time world leaders met for an environmental summit in Rio de Janeiro they met amid the recent collapse of the Soviet Union, opening the world's eyes to central planning and its poverty-for-all mantra and the biggest global effort to open world markets in 40 years.

Twenty years on, the benefits are clear -- a world that's more open, prosperous and sustainable, healthy, clean, well-nourished and more secure. Open trade and greater access to goods, services and information will do that.

The Rio+20 meeting reaffirmed the importance of this. But environmental activists remain unsatisfied.

WWF states that under the free market model we consume and produce too much, a trend that will inevitably lead to shortages of food and depletion of resources because of a rapidly growing world. WWF argues that if people want to protect the environment, they should cut their consumption in half.

WWF proposed a new yardstick for a green economy, measuring that progress by their own distinct goals that would see environmental objectives overriding economic and social objectives.

What is Greenpeace's contribution? Something that damages business, of course. It has declared that six of the world's biggest companies should be boycotted because they generate wealth and jobs from activities and resources.

WWF's assertion that "greening" an economy does not cost development and jobs is environmental dogma and has no basis in sound economics.

WWF wants commercial forestry halted. Of course, if forestry clearance is stopped, expansion of agriculture is impeded and jobs are reduced. But WWF has the numbers wrong. Commercial forestry operations are not the major driver of forest clearance.

Wangari Maathai, the late African Nobel Peace Prize laureate and conservationist, once pointed out that "40 percent of wood taken from forests globally is used for basic energy needs such as cooking and heating."

Poverty, rather than market forces, is driving deforestation. Only through a marked increase in prosperity and trade will we see a considerable improvement in the management of the environment in the developing world.

Similarly, WWF claims that palm oil is the root cause of deforestation in Indonesia and Malaysia, despite the latter's government reserving half of its forest estate.

In Malaysia, palm oil production by small farmers supports approximately 1 million people. In Indonesia this is much higher, with 3 million people reaping the economic benefits of the country's booming palm oil industry.

In fact, the World Bank used to finance palm oil production in the developing world because they regularly saw first-hand how it lifted the poor and landless out of poverty -- such investment has been noted to be three times more effective at reducing poverty than any other sector.

But if governments tax success, WWF seeks to certify it, pushing certification schemes on Western retailers and government to adopt standards that would put palm oil and forestry from developing nations at a distinct competitive disadvantage. Greenpeace "greenmails" the companies which do not go along. But that's the point.

The Rio+20 outcome provides a path for rational and practicable solutions to environmental problems that do not reduce economic growth. The key is to follow them, and sideline radical environmental strategies.

(Alan Oxley is chairman of the international pro-development non-governmental organization World Growth and former chairman of the General Agreement on Tariffs and Trade, the predecessor of the World Trade Organization.

(United Press International's "Outside View" commentaries are written by outside contributors who specialize in a variety of important issues. The views expressed do not necessarily reflect those of United Press International. In the interests of creating an open forum, original submissions are invited.)

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