by Cormac Jelicich
In 2020, two crises coincided. First, the COVID-19 pandemic caused unprecedented socioeconomic harm, triggering a devastating health crisis that engendered the steepest recession since the Great Depression. Second, the myriad of ecological crises became more obvious, with record-breaking floods, storms, and wildfires affecting millions across the globe.
To arrest economic downturn, many governments have responded with massive fiscal packages to boost the economy, maintain employment, and stabilise core industries. However, there is deep concern that these economic responses will undermine the goals outlined in the Paris Climate Accords and cause a surge in greenhouse gas emissions, much like the aftermath of the 2008 Global Financial Crisis. For the most part, governments worldwide (including New Zealand) have pursued the dirty path of grey recovery. In response to these developments, clarion calls from across the science and policy spheres have called for a ‘green recovery,’ a series of economic recovery measures that simultaneously address long-term climate and sustainability objectives as well as short-term economic concerns. Proponents of a green recovery argue that these measures will help us transition toward a more sustainable and resilient economic model for the planet.
Three countries have emerged as leaders in post-COVID green recovery: France, Germany, and the U.K. Analysis of these three countries can help policymakers assess how a green recovery could be successfully designed and implemented in New Zealand. Three key aspects stand out when comparing these countries’ green recovery packages: size, scope, and implementation and delivery.
‘Size’ indicates the total amount of spending allocated towards green recovery, and as a percentage of total economic recovery spending. Out of the three, France allocated the highest amount to green recovery (€30.4 billion), while Germany and the U.K. spent €27.5 billion and €17.3 billion respectively. Although French and German spending appears relatively close, the former spent significantly more on green recovery as a percentage of total economic recovery (30.4% compared to 21.2% in Germany). Proportional spending was not calculated in the UK because green recovery spending was not part of a unified economic recovery package.
‘Scope’ refers to the sectoral allocations of green recovery, i.e., to which industries and sectors were funding directed. In Germany, the government directed significant funding to the EV and Hydrogen industries to bolster their strength in existing industries and promote themselves as leaders in new green technologies. To address long-standing concerns regarding unemployment, France directed funding toward sectors with a high potential for job creation, such as building retrofits and expanding and decarbonising railways.
‘Implementation and Delivery’ focuses on the measures and programs through which green recovery spending was allocated. Key differences in how each country implemented and delivered its green recovery initiatives can be seen in the building retrofits sector. For example, retrofits in France and Germany employed a ‘whole-of’ building approach, improving energy efficiency in the major components of a building (e.g. insulation), as well as in the minor components (lightbulbs, heaters, etc.). Contrastingly, the U.K. employed a ‘piecemeal’ approach to retrofits, improving energy efficiency incrementally over a longer time period.
Additional consideration must be given to the strategic and political rationales and motivations underlying each green recovery. For example, green recovery spending in France was sizeable because President Emmanuel Macron wished to be seen as a transformational and visionary green leader before the 2022 Presidential Election.
While we are yet to see the full impact of these countries’ approaches, they reveal several themes which would be conducive to a successful green recovery in New Zealand:
1) A Move Towards the Circular Economy
A circular economy (CE) is a model of production and consumption focusing on the 4Rs: reuse, recycle, repair, and refurbish. Essentially, a CE is a ‘closed-loop’ process – products are reused rather than scrapped. A CE is in contradistinction with the traditional ‘linear’ economy, where products are made and then disposed of, with negative environmental offshoots. A move to a CE is vital for New Zealand, not only to reduce waste, but also to create local job opportunities and modernise our vital primary industries.
2) Promote Resilience in our Growing Urban Centres
New Zealand’s urban centres are growing and growing fast. Auckland, in particular, is expected to have approximately 2 million residents by 2030, which will increase pressure on the city’s threadbare public infrastructure. Additionally, the frequency and severity of natural hazards are expected to increase in the coming decade due to climate change. Therefore, it is imperative that we make our urban centres more resilient to future shocks. Policymakers should consider a range of nature-based solutions, such as expanding the number of interconnected green spaces across urban areas, focusing mitigation and adaptation efforts in high-risk areas (i.e., areas by the coastline), and increasing citizen involvement and participation in the implementation and delivery of resilience efforts.
3) Target Green Recovery Efforts in Deprived Regions
In several regions across New Zealand, unemployment remains stubbornly high, especially among Māori. One of the key benefits of a green recovery is its job-creating properties, especially in conservation, clean energy, environmental management, along with agriculture and horticulture. A green recovery offers the rare chance to reduce regional economic disparities, create thousands of new, well-paid ‘green jobs’ and boost economic growth, while also restoring and protecting our precious natural environments.
4) Mass Transit, Especially Rail, is the Future
Moving Kiwis from their cars and onto mass transit is crucial to meeting our net-zero emissions targets and reducing pollution. Rail, in particular, will be crucial to achieving this. Currently, New Zealand’s mass transit system is woefully inadequate and unprepared for widely expected population growth. Policymakers must focus on improving access to mass transit. This will entail the expansion of access in high-growth urban corridors like Auckland, Wellington, and Tauranga, the restoration of discontinued rail links in the regions and other rural areas, and the extension of the half-price fares scheme for the foreseeable future.
As economic and ecological woes mount, a radical transformation of our economic approach is urgently needed. A green recovery is crucial to transitioning to a sustainable and more resilient economic model for the planet. Without significant government intervention, the economic and ecological challenges we face will only worsen, causing severe and protracted harm for millions of New Zealanders. Seizing this rare opportunity is essential, not only in New Zealand but globally too.
Cormac Jelicich is a Master of Public Policy student at the University of Auckland.
The Big Q is working with Ngā Ara Whetū to bring you research and news on climate, biodiversity, and society from an Aotearoa, New Zealand perspective.
Disclaimer: The ideas expressed in this article reflect the author’s views and not necessarily the views of The Big Q.
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