Trade, material flows and economic development in Chile

Transcription

1 Ministry of Economic Affairs , Santiago de Chile Trade, material flows and economic development in Chile Dr. Stefan Giljum

2 Structure of presentation 1. Policy background (EU & OECD) 2. Material Flow Accounting and Analysis (MFA) 3. MFA-based indicators for Chile 4. MFA and sustainability assessments 5. Possible future work and applications in Chile

3 1. Policy background Environmental policy developments in the EU Changing environmental problems in past 30 years: local/regional transnational/global persistent (sustainability) problems: e.g. energy, materials, land, GHGs, etc. Changing policy instruments: command-and-control (waste and emissions) economic and voluntary instruments (tackling driving forces: high levels of energy and resource use) Environmental governance Environmental policy integration ( Cardiff Process )

4 1. Policy background Natural resource use as core issue of EU policies 6th Environmental Action Plan: 4 thematic core areas Sustainable Use of Natural Resources: de-coupling of economic growth from use of natural resources (dematerialisation) & environmental degradation (detoxification) Interrelations between economy and the environment accounting of material flows, energy, emissions, land use, etc. Integrated accounting systems (e.g. SEEA, NAMEA)

5 1. Policy background MFA in EU and OECD European Union: key method for monitoring resource use & de-coupling goals with MF-based indicators EUROSTAT, EEA, EU Commission: harmonisation of approaches and data (available for all EU countries) OECD: Environment Directorate 2000: MFA as important tool April 2004: OECD Environmental Ministers: Recommendation on MF and resource productivity June 2004: Workshop on MF and MF indicators Work programme for next 3 years: guidance document, inclusion in OECD core set of environmental indicators

6 2. Material flow analysis (MFA) MFA: methodological foundations Analysing the composition of the physical metabolism of societies determining the physical scale of an economy Monitoring its developments with MF-based indicators Basic assumption: all materials extracted or moved by humans exert pressure on the environment Many environmental problems are directly or indirectly related to the material/energetic metabolism of the economy climate change, waste problems; soil degradation; air and water pollution, etc.

7 2. Material flow analysis (MFA) Methodological guide for economy-wide MFAs (EUROSTAT 2001) Domestic extraction: -fossil fuels -minerals -biomass Material accumulation (net addition to stock) Emissions Waste Unused domestic extraction Unused domestic extraction Imports Exports Indirect flows associated to imports Recycling Indirect flows associated to exports

8 2. Material flow analysis (MFA) MFA on the level of economic sectors (e.g. mining) Primary extraction: - copper - iron - etc. - Emissions to water and air - Solid waste UDE: overburden UDE: overburden Inputs: energy, machinery, chemicals, etc. Concentrated metal IF of inputs: e.g. energy production IF of concentrated metal

9 2. Material flow analysis (MFA) MFA: strengths Comprehensive approach complete accounting of the biophysical dimension of economic activities Focusing on persistent environmental problems related to scale (material and energy use, GHG emissions, etc.) rather than toxicity-related environmental problems Monitoring rebound effects & shifts of pollution between different environmental media

10 2. Material flow analysis (MFA) MFA: strengths Data organization compatible with System of National Accounts economic/environmental indicators & modelling Indicators on different levels of aggregation micro, sectoral, macro material groups input, output, consumption, trade Macro indicators: Total environmental pressure (as an environmental indicator equivalent to GDP, employment)

11 2. Material flow analysis (MFA) MFA: weaknesses Environmental pressures, but no detailed information on environmental impacts (complementary to trad. indicators) No weighting of material flows no consideration of qualitative aspects (scarcities, toxicities), one single accounting unit (tons) link to methods of e.g. life cycle assessment (LCA) Problem of aggregation: big flows dominate aggregated indicators, no information on material substitution, less is not necessarily better Economy as a black box: no information on the interrelations between economic sectors analysis of economic sectors / physical or monetary input-output analysis needed

12 2. Material flow analysis (MFA) Policy-oriented applications Integrated environmental-economic-social accounting (e.g. SEEA of UN) Calculation of resource productivities (national economy, sectors) role of technological and demand changes, identification of profitable resource reductions Globalisation, international trade & structural change: distribution of environmental burdens between N & S Linking the micro and the macro perspective (e.g. analyses of rebound effects) Integrated sustainability modelling

13 3. MFA-based indicators for Chile Giljum, S. (2004): Trade, material flows and economic development in the South: the example of Chile. Journal of Industrial Ecology, Vol. 8 (1-2), Purposes of the study What were the implications of the export-oriented development strategy on the extraction and use of natural resources? In what way has world market integration changed Chile s physical trade patterns? What were the links between economic development and natural resource use eco-efficiency / resource productivity of Chilean economy and of the main export sectors?

14 3. MFA-based indicators for Chile Direct material input (DMI): domestic extraction + imports Domestic extraction: -fossil fuels -minerals -biomass Imports

15 3. MFA-based indicators for Chile Direct material input (DMI): domestic extraction + imports million tons Imports DE Biomass DE Fossils DE Minerals and ores (excl. copper) DE Copper Domestic extraction: Minerals: 805%, Biomass: 100%, Fossils: - 66% Imports: 360 %

16 3. MFA-based indicators for Chile Direct material input (DMI) / capita tons/capita Chile Brazil Venezuela EU-15 Japan

17 3. MFA-based indicators for Chile Use of direct material input tons/capita Chile 1973 Chile 1980 Chile 1990 Chile 2000 Direct exports Indirect flow s associated w ith copper exports Remaining domestic consumption Large part of domestic extraction is linked to (copper) exports

18 3. MFA-based indicators for Chile Physical trade balance (PTB): Imports exports Imports Exports

19 3. MFA-based indicators for Chile Physical trade balance (PTB): Imports exports million tons Imports Exports Balance (Im-Ex) Change in physical trade profile: net-exporter balanced physical trade relations (on a high level) Difference to other Latin American countries

20 3. MFA-based indicators for Chile Physical trade balance (PTB): including indirect flows Imports Exports Indirect flows associated to imports Indirect flows associated to exports

21 3. MFA-based indicators for Chile Physical trade balance (PTB): including indirect flows million tons Imports Exports Balance (Im-Ex) Indirect flows for copper exports and fossil fuels imports Net-exporter of environmental capacity net-accumulation of environmental pressures from trade activities

22 3. MFA-based indicators for Chile Direct material input (DMI) / GDP Domestic extraction: -fossil fuels -minerals -biomass Imports

23 3. MFA-based indicators for Chile Direct material input (DMI) / GDP [1975 = 100] DMI GDP (constant 1995 pesos) GDP/DMI GDP/DMI (excluding copper mining sector) Aggregated eco-efficiency halved between 1973 and 2000 But: sectors other than copper mining show positive trend

24 3. MFA-based indicators for Chile Eco-efficiency of three main resource extraction sectors [1975 = 100] Agriculture and Forestry Fishing Mining Increasing eco-efficiency in fishery sector: aquaculture Decreasing eco-efficiency in mining sector: copper

25 3. MFA-based indicators for Chile Conclusions Export-oriented development: rapid metabolic change, increased anthropogenic pressures on natural systems (increased resource extraction & increased production of emissions and waste) Major part of material flows induced by international trade (in particular: mining sector) much slower growth of domestic consumption

26 3. MFA-based indicators for Chile Conclusions Net-exporter of environmental capacity in terms of ecological rucksacks accumulation of negative environmental effects of foreign trade activities (with economic consequences) Overall economy: decreasing eco-efficiency, negative trend in some sectors: rising environmental pressures and falling economic values (copper) Positive development in some export sectors: e.g. fisheries with increasing role of aquaculture (salmon)

27 4. The MOSUS project Is Europe sustainable? Modelling opportunities and limits for restructuring Europe towards sustainability MOSUS is funded by the 5th Framework Programme of the European Union (sub-programme environment and sustainable development) MOSUS is endorsed by the Industrial Transformation Project of the International Human Dimensions Programme (IHDP-IT)

28 4. MOSUS: model structure Existing economic model system on the global level 55 countries / world regions Up to 36 economic sectors (OECD input-output data) Bi-lateral trade models (up to 25 product groups) Extension by environmental input data in physical units: material inputs, land cover and land use, energy inputs (already included in energy models). comprehensive economic-environmental simulation tool

29 4. The MOSUS project Comprehensive quantification of European use of natural resources (incl. ecol. rucksacks ) indirect flows associated with imports (foreign hidden flows) tonnes per capita imports un-used domestic extraction (domestic hidden flows) domestic used extraction Source: Bringezu and Schütz, 2001

30 4. The MOSUS project Project objectives EU development scenarios Impacts of key environmental policy measures (ecological tax reform, reform of the subsidy system, implementation of Kyoto instruments) on economic and social indicators and on use of natural resources. The role of domestic and total resource inputs for European growth potentials and job creation Economically efficient strategies for resource use reductions Quantified policy recommendations to reconcile sustainability goals in Europe

31 5. Future work in Chile Possible future work and applications in Chile MFA: completion of data and official statistics Update of time series Output flows (waste and emissions) Unused domestic extraction Inclusion of MFA (and indicators) in environmental statistics (INE) as instrument to monitor resource use of Chilean economy (OECD process)

32 5. Future work in Chile Possible future work and applications in Chile MFA of key export sectors Links between value creation and energy / material use (production of emissions and waste) Identification of economically efficient strategies to increase ecoefficiency of exported products (e.g. adding value) Policy strategies to react to changes in environmental regulations by trading partners Long-term restructuring: sustainable exploitation of renewable resources

33 5. Future work in Chile Possible future work and applications in Chile Scenarios and modelling Development of an integrated environmental-economic model (extended environmental input-output model with sectoral disaggregation) Simulation of policy measures on the micro and sectoral level (de-linking of resource use and economic growth) Identifying pro-active strategies for reacting to changes in demand (dematerialisation of industrialised countries) and environmental regulations of trading partners (linkages with world economy modelled by integration with MOSUS model)

34 5. Future work in Chile Possible future work and applications in Chile Environmental pressures impacts Mining: emissions of CO 2 and SO 2, waste water, disposal of overburden and chemically reactive solid residuals Agriculture / Forestry: high levels of pesticide and fertilizer use pollution of soil and water with negative health effects; loss of biodiversity (Future) Socio-economic implications of environmental degradation (e.g. reduction of soil productivity in agricultural or forestry systems)

35 The end..thank you! More information: