კონფერენცია

∘ Giorgi Kharshiladze ∘
THE POSSIBILITIES AND DIFFICULTIES OF FORMING “GREEN ECONOMY” IN GEORGIA

Suumary

A Green Economy is characterized by substantially increased investments in economic sectors that build on and enhance the earth’s natural capital or reduce ecological scarcities and environmental risks. These sectors include renewable energy, low-carbon transport, energy efficient buildings, clean technologies, improved waste management, improved freshwater provision, sustainable agriculture and forest management, and sustainable fisheries.

These investments are driven by or supported by national policy reforms and the development of international policy and market infrastructure. These investments and policy reforms provide the mechanisms and the financing for the reconfiguration of businesses, infrastructure and institutions, and the adoption of sustainable consumption and production processes. Such reconfiguration leads to a higher share of green sectors contributing to GDP, greener jobs, lower energy and resource-intensive production, lower waste and pollution, and significantly lowers greenhouse gas emissions. It can also assist in the reduction of persistent poverty through targeted wealth transfers, new employment, as well as improvements in access and the flow of ecosystem goods and services to the bottom of the economic pyramid.

The UNEP-led Green Economy Initiative, launched in late 2008, consists of several components whose collective overall objective is to provide a macroeconomic analysis of policy reforms and investments in green sectors and in greening brown sectors. The Initiative will assess how sectors – such as renewable energies, clean and efficient technologies, water services and sustainable agriculture – can contribute to economic growth, creation of decent jobs, social equity and poverty reduction, while addressing climate risk and other ecological challenges.

Beyond UNEP, the Green Economy Initiative is one of the nine UN-wide Joint Crisis Initiatives, launched by the UN System’s Chief Executives Board in early 2009. In this context, the Initiative includes a wide range of research activities and capacity-building events from over 20 UN agencies, including the Bretton Woods Institutions, as well as an Issue Management Group on Green Economy, launched in Washington, DC in March of 2010.

The development of a green economy (GE) in Georgia can effectively support the attainment of national development targets in the Green Growth Policy Paper (Ministry of Economy and Sustainable Development of Georgia, In Press). While that policy paper provides a qualitative assessment of how the green economy concept can be applied through the implementation of policies that would stimulate green growth and hence allow the country to achieve stated targets in a more cost effective manner,

Georgia’s economic development, especially of its industrial sector, relies heavily on the exploitation of the country’s natural capital such as minerals, water, biological resources, landscapes and pristine ecosystems. Air emissions and pollution of surface water, groundwater and soil remain important issues in regions where manufacturing and mining enterprises are located. The energy intensity of the Georgian economy is high and the amount of specific energy needed to produce goods and services in Georgia is 2–2.5 times higher than in Western countries. Recognizing the importance of decoupling the economic development from environmental degradation the Georgian government put the transition towards green economic growth high on its political agenda.

The EU-funded EaP GREEN program and its Resource Efficient and Cleaner Production Demonstration Component provided a significant support to Georgia to make first steps towards transition to a green economy. The RECP project assessed the potential and demonstrated the practical ways for improving the resource productivity, reducing the environmental impact and achieving economic benefits in Georgian industrial enterprises. The project supported the creation of human and institutional capacities for a wider application of RECP in the country. It demonstrates successful application of this methodology and promotes transfer of and investment into RECP technologies as the best practice for small and medium sized businesses on their way to greener and more competitive production.

Ivane Javakhishvili Tbilisi State University Paata Gugushvili Institute of Economics International Scientific C O N F E R E N C E S "ECONOMY – XXI CENTURY"

E ISSN 2587 - 4691	∘ Giorgi Kharshiladze ∘ THE POSSIBILITIES AND DIFFICULTIES OF FORMING “GREEN ECONOMY” IN GEORGIA Suumary A Green Economy is characterized by substantially increased investments in economic sectors that build on and enhance the earth’s natural capital or reduce ecological scarcities and environmental risks. These sectors include renewable energy, low-carbon transport, energy efficient buildings, clean technologies, improved waste management, improved freshwater provision, sustainable agriculture and forest management, and sustainable fisheries. These investments are driven by or supported by national policy reforms and the development of international policy and market infrastructure. These investments and policy reforms provide the mechanisms and the financing for the reconfiguration of businesses, infrastructure and institutions, and the adoption of sustainable consumption and production processes. Such reconfiguration leads to a higher share of green sectors contributing to GDP, greener jobs, lower energy and resource-intensive production, lower waste and pollution, and significantly lowers greenhouse gas emissions. It can also assist in the reduction of persistent poverty through targeted wealth transfers, new employment, as well as improvements in access and the flow of ecosystem goods and services to the bottom of the economic pyramid. The UNEP-led Green Economy Initiative, launched in late 2008, consists of several components whose collective overall objective is to provide a macroeconomic analysis of policy reforms and investments in green sectors and in greening brown sectors. The Initiative will assess how sectors – such as renewable energies, clean and efficient technologies, water services and sustainable agriculture – can contribute to economic growth, creation of decent jobs, social equity and poverty reduction, while addressing climate risk and other ecological challenges. Beyond UNEP, the Green Economy Initiative is one of the nine UN-wide Joint Crisis Initiatives, launched by the UN System’s Chief Executives Board in early 2009. In this context, the Initiative includes a wide range of research activities and capacity-building events from over 20 UN agencies, including the Bretton Woods Institutions, as well as an Issue Management Group on Green Economy, launched in Washington, DC in March of 2010. The development of a green economy (GE) in Georgia can effectively support the attainment of national development targets in the Green Growth Policy Paper (Ministry of Economy and Sustainable Development of Georgia, In Press). While that policy paper provides a qualitative assessment of how the green economy concept can be applied through the implementation of policies that would stimulate green growth and hence allow the country to achieve stated targets in a more cost effective manner, Georgia’s economic development, especially of its industrial sector, relies heavily on the exploitation of the country’s natural capital such as minerals, water, biological resources, landscapes and pristine ecosystems. Air emissions and pollution of surface water, groundwater and soil remain important issues in regions where manufacturing and mining enterprises are located. The energy intensity of the Georgian economy is high and the amount of specific energy needed to produce goods and services in Georgia is 2–2.5 times higher than in Western countries. Recognizing the importance of decoupling the economic development from environmental degradation the Georgian government put the transition towards green economic growth high on its political agenda. The EU-funded EaP GREEN program and its Resource Efficient and Cleaner Production Demonstration Component provided a significant support to Georgia to make first steps towards transition to a green economy. The RECP project assessed the potential and demonstrated the practical ways for improving the resource productivity, reducing the environmental impact and achieving economic benefits in Georgian industrial enterprises. The project supported the creation of human and institutional capacities for a wider application of RECP in the country. It demonstrates successful application of this methodology and promotes transfer of and investment into RECP technologies as the best practice for small and medium sized businesses on their way to greener and more competitive production.