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RETHINKING GOVERNANCE

have already committed to a low-carbon future. The Rio+20 meeting in June 2012 is an opportunity for the international community to deliver an equally strong message. And low-carbon development choices are already being made. If you have never had a sewage treatment plant, you can start with a state-of-the-art one that will produce electricity from the sludge. If you have no rural electricity system, you can train women in villages to install and operate solar power generators. For industries such as chemicals, the solution is more complex, as Russel Mills explains. Energy is a particular challenge. Demand is forecast to rise sharply in coming years, with most of the growth in emerging economies. The crisis is no excuse to delay low-carbon energy investment. Indeed, failure to invest in clean technology now will simply mean higher costs later to deal with the increased greenhouse gas emissions. There can be no lasting solution to any of these issues without greener growth in cities. Half the world’s population lives in urban areas; cities consume 60-80% of world energy production and account for a similar share of global CO2 emissions. Cities can stimulate green jobs by raising consumer awareness, making local business more eco-efficient, facilitating cleantech start-ups and supporting training programmes. And small changes can have significant effects. By switching to low-energy light bulbs, for example, the EU is obliging 500 million people to make a greener choice. This is an issue where governance at all levels, from local to global, really matters, and policies have to be coherent between the different levels for progress to be made.

Managing scarce resources Without water we cannot survive. Yet billions of people still live without access to stable supplies of clean water, and a growing world population will put increasing pressure on this finite resource in years to There can be no lasting come. Significant solution without greener water scarcities growth in cities already exist in some regions of the OECD and in many non-OECD countries, and it is projected that almost half of the world’s population, or close to 4 billion people, will be living in areas with high water stress by 2030, mostly in non-OECD countries.

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OECD Yearbook 2012 © OECD 2012

This is a fundamental question of global governance. Access to safe drinking water is vital for everyone, and good husbandry of this precious resource is crucial in all countries. Agriculture currently accounts for 70% of global water use, but in many OECD countries farmers’ water costs are subsidised, which may lead them to be less concerned about waste and inefficient use. The same is true at a personal level. When people pay for their household water depending on how much they use, rather than at a flat rate, consumption falls by 20%, even at low price levels. Water infrastructure is costly to install and maintain. The US will have to spend $23 billion every year for the next 20 years to maintain water infrastructure at levels that meet health and environmental standards, for example. But poor upkeep carries a huge cost. Even in well-run water utilities in OECD countries, leakage accounts for 10-30% of water loss; in developing countries it often exceeds 40%.

When people pay for their household water depending on how much they use, rather than at a flat rate, consumption falls by 20%

Access to the raw materials that help drive the global economy and society is also a key global issue that cannot be resolved by a single country or group of countries. Income from illegal exploitation of natural resources in fragile African states, such as gold, diamonds and minerals needed for electronic equipment, has been fuelling conflict across the region for a decade. The illegal trade stokes conflict, boosts crime and corruption, finances international terrorism, and blocks economic and social development. New guidance drawn up by the OECD, and supported by governments in producing states and businesses that use the minerals, aims to help companies ensure that they are not acquiring illegal minerals, without boycotts that would see miners go hungry and prices of goods such as medical equipment soar. This kind of governance is necessary in a globalised world in the interests of producers and final consumers.

2012 OECD Yearbook  

2012 OECD Yearbook

2012 OECD Yearbook  

2012 OECD Yearbook

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