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Chapter One: Global Perspectives

Social and economic background

Since 1950, the global economy has more than quintupled in size. Despite the financial turmoil in East Asia starting in late 1997, the world's economy continues to expand, growing by 4.1 per cent in 1997. In terms of income, the global per capita average has now passed US$5 000 a year - 2.6 times that of 1950 (in real terms).

 GDP per capita

(Click image to enlarge)

Source: compiled by RIVM, the Netherlands, from World Bank and UN data

Steady growth in global GDP/ capita hides large differences both between and within regions

Average figures for income hide great discrepancies between regions (see graph), between countries, and between population groups within countries. Despite remarkable improvements in many places, one-quarter of the world's population remains in severe poverty. In 1993, more than 1 300 million people were living on less than US$1 per day. Of these, the largest number, nearly 1 000 million people, are in the Asia and Pacific region; the highest proportion and the fastest growth are in sub-Saharan Africa, where half the population is expected to be poor by 2000; a growing number, 110 million in 1993, are in Latin America; the number below the poverty level in Eastern Europe and the former Soviet Union had risen to 120 million people by 1993/94; and, in industrialized countries, 80 million people are still below the poverty line (UNDP 1997).

Nearly half of all people now live in cities; an increasing number of them travel enormous distances every year by private car and in aircraft. In the developed world, technology has transformed patterns of work and family life, communications, leisure activities, diet and health. Similar transformations are well under way in the more prosperous parts of the developing world.

The impacts of these changes on the natural environment are complex. The modern industrial economies of North America, Europe and parts of East Asia consume immense quantities of energy and raw materials, and produce high volumes of wastes and polluting emissions. The magnitude of this economic activity is causing environmental damage on a global scale (notably climate change) and widespread pollution and disruption of ecosystems, often in countries far removed from the site of consumption. Considerable progress has been made in controlling pollution at local and transboundary levels in the wealthier industrialized countries but the wider-scale impacts (apart from ozone depletion) have yet to be tackled effectively.

 Annual average growth of per capita GDP (1975-95)
Africa -0.20%
Asia and the Pacific 3.09%
Europe and Central Asia 1.54%
Latin America and the Caribbean 0.66%
North America 1.53%
West Asia -2.93%
World 1.17%

Source: compiled by RIVM, the Netherlands, from World Bank and UN data


In other regions, particularly in many parts of the developing world, poverty combined with rapid population growth is leading to widespread degradation of renewable resources - primarily forests, soils and water. People living in subsistence economies are faced with few alternatives to depleting their natural resources. Renewable resources still sustain the livelihood of nearly one-third of the world's population; environmental deterioration therefore directly reduces living standards and prospects for economic improvement among rural peoples. At the same time, rapid urbanization and industrialization in many developing countries are creating high levels of air and water pollution, which often hit the poor hardest. Worldwide, the urban poor tend to live in neglected neighbourhoods, enduring pollution, waste dumping and ill health, but lacking the political influence to effect improvements. Consumption and waste generation among the newly industrialized nations are rising very steeply - approaching, and in some cases even overtaking, per capita consumption levels in industrialized countries. In 1995, per capita energy consumption in the Republic of Korea, for example, equalled that of Italy (UNSTAT 1997). The same is true of many consumers in prosperous enclaves of the developing countries and those in economies in transition.

So what does the future hold in store? GEO-1 included an account of a 'business-as-usual' scenario in which the world population nearly doubled between 1990 and 2050, and GDP per capita, expressed in constant prices, grew 2.4 times. Simultaneously, food requirements doubled, energy consumption rose by a factor of 2.6 and water consumption by a factor of nearly 1.5. The world economy continued its rapid growth with a projected rise in GDP of 4.5 times. Under this scenario, sufficient food would be available globally to feed all the growing population but inequalities of access would mean that hunger would remain.

From what follows in GEO-2000, it is clear that if present trends in population growth, economic growth and consumption patterns were continued, the natural environment would be increasingly stressed. Distinct environmental gains and improvements would probably be offset by the pace and scale of global economic growth, increased global environmental pollution and accelerated degradation of the Earth's renewable resource base.

The negative impacts of environmental degradation would fall most heavily (as they do now) on the poorer developing regions. The income gap between rich and poor countries, and between the rich and poor within countries, would increase for several decades. The ratio of income between the richest and poorest 20 per cent of the world population doubled from 30:1 to more than 80:1 between 1960 and 1995 (UNDP 1998). Under a business-as-usual scenario, current inequities in the distribution of the environmental costs and benefits of consumption seem likely to grow worse. This could be expected to have a destabilizing influence on the physical, social and political environment.

However, trends towards environmental degradation can be slowed, and economic activity can be shifted to a more sustainable pattern. Choices for development, and levels and patterns of consumption, are shaped by human aspirations and values, and these choices can be influenced by policy intervention. Many promising policy responses are being developed and tested, as described in this report.

Some environmental trends over the past half-century demonstrate the potential of regulation, information and, above all, prices to encourage both more efficient and less polluting uses of energy and materials. Technology has already delivered astonishing improvements in product performance but innovation to improve resource productivity - the utility that can be squeezed out of any given amount of resource input - has so far lagged behind. Better public understanding and awareness of the environmental and social consequences of the consumer society have begun to catalyse profound shifts in purchasing behaviour and lifestyle choices. The challenge for policy-makers in the next century will be to devise approaches that encourage a more efficient, fair and responsible use of natural resources by the production sectors of the economy, that encourage consumers to support and demand such changes, and that will lead to a more equitable use of resources by the entire world population. In this context, policy-makers are not necessarily government officials. Business leaders also make policy, and in some of the major industrialized countries business leaders are already leading the way to improved systems of resource use (Rabobank 1998).

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