Economists urge China to think ‘beyond GDP’ to head off climate risks

11:54 pm Wednesday, February 22nd, 2023

By David Stanway

SINGAPORE (Reuters) – A team of influential economists has urged China to adopt a new development model based on “wellbeing” rather than GDP growth in order to fulfil its 2060 net-zero emissions goals and head off the mounting threats of climate change.

In a report published on Thursday, the team – which includes two former chief economists of the World Bank – also called on China to cap total fossil fuel consumption and establish a detailed “pathway” for reducing emissions.

The report and its recommendations have already been submitted to the Chinese government. Co-author Nicholas Stern, chair of Britain’s Grantham Research Institute on Climate Change and the Environment, told reporters he hoped it would play a constructive role in China’s 2026-2030 “five-year plan”.

The old development model drove rapid growth in China over the last four decades, but is putting the world at “grave risk”, the report said.

China is aiming to bring emissions to a peak by 2030, though it currently remains unclear at what level they will peak. Stern said it needed to set a specific numerical target in order to bring “clarity” to its decision-making.

The report also called on China to give greater prominence to public transport and set a timetable for the elimination of fossil-fuel vehicles. China should also promote low-carbon agriculture, including plant-based meat and dairy, it said.

China began experimenting with “green GDP” in 2005 as concerns mounted about the environmental damage done by rapid industrialisation. A 2006 government report concluded that environmental losses amounted to 3% of total GDP, but critics believed the actual figure was much higher.

Though the green GDP project was cancelled in 2009, China promised in 2013 to abandon a “growth at all costs” model and said GDP would no longer be the sole criteria on which officials would be assessed.

Some provinces have recently resumed efforts to create new indicators reflecting the environmental costs of development, with central China’s Hubei using a pilot “gross ecosystem product” that can be applied to individual districts, rivers or development projects.

China is home to 16 of the 20 global regions most vulnerable to climate change, data showed on Monday.

(Reporting by David Stanway; Editing by Simon Cameron-Moore)