Greening the future: Path to a sustainable economy for Bangladesh

In recent years, the concept of the green economy has emerged as a crucial element for addressing some of the most pressing global challenges — environmental degradation, economic inequality, and climate change. 

A green economy is an economic framework designed to achieve sustainable development by balancing economic growth with environmental responsibility. It emphasises low-carbon, resource-efficient, and socially inclusive practices. 

In a green economy, growth in income and employment is driven by investments that reduce carbon emissions, minimise waste and pollution, and protect biodiversity. 

The ultimate goal is to enhance energy efficiency, promote renewable energy, and create sustainable industries that contribute to the well-being of both the planet and its people, ensuring long-term ecological and economic resilience.

Why we need a green economy

The global economy, as it stands today, is largely based on unsustainable practices. For decades, economic growth has been achieved at the expense of the environment, resulting in severe pollution, depletion of natural resources, and accelerating climate change. 

According to the World Bank's recent Country Environmental Analysis, Bangladesh, like many other nations, has experienced rapid growth while incurring significant environmental costs. The same analysis places Bangladesh among the countries most affected by pollution and environmental health risks, underscoring the urgency of transitioning to a green economy.

A green economy offers an alternative by emphasising the efficient use of resources, lowering emissions, and fostering social equity. This is critical not only to mitigate climate change but also to create economic opportunities that are resilient and inclusive, especially for vulnerable populations who rely on natural resources for their livelihoods.

Green growth and sustainable development

Green growth is the cornerstone of the green economy. It involves promoting economic growth while ensuring that natural resources are used sustainably. In this model, industries and governments invest in green technologies, renewable energy, and sustainable agriculture, creating jobs and spurring innovation without exhausting finite resources or causing environmental harm. 

By driving innovation and encouraging sustainable consumption and production, green growth can deliver sustainable development. It aligns economic, social, and environmental goals by reducing the ecological footprint of economic activities while improving human well-being. 

While there may be alternatives to green growth, such as degrowth strategies that focus on reducing consumption overall, green growth provides a more pragmatic approach for countries aiming to maintain economic stability and improve quality of life while addressing environmental concerns.

Bangladesh, like many other nations, has experienced rapid growth while incurring significant environmental costs. The same analysis places Bangladesh among the countries most affected by pollution and environmental health risks, underscoring the urgency of transitioning to a green economy.

Pillars of the green economy

The green economy is supported by three key pillars: sustainable consumption and production, resource efficiency, and social inclusion. These pillars work together to ensure that economic growth is achieved without depleting natural resources or exacerbating inequality.

Sustainable consumption and production involves improving how goods are produced and consumed to minimise waste and reduce emissions. For instance, the shift towards renewable energy sources like solar and wind power reduces reliance on fossil fuels.

Efficient use of resources — whether water, energy, or raw materials — is central to the green economy. By optimising resource use, businesses and governments can lower costs and reduce environmental impact.

Green investments should also benefit all segments of society, particularly marginalised and vulnerable groups. Creating jobs in renewable energy sectors and enhancing access to clean energy are examples of how green initiatives can promote social equity.

A comparison between the green economy and the circular economy also reveals important distinctions. 

While both models emphasise sustainability, a circular economy focuses on eliminating waste by keeping products and materials in use for as long as possible, through practices like recycling and designing for longevity. 

The green economy, on the other hand, encompasses broader goals, including reducing carbon emissions and enhancing resource efficiency. Both frameworks, however, play complementary roles in driving sustainable development.

How green is our economy and lifestyle?

Globally, there is a growing awareness for the need of greener lifestyles, but much remains to be done. While many countries are making strides in areas like renewable energy, sustainable agriculture, and green building, the pace of change is still too slow. 

The focus on consumer goods that are produced sustainably, reducing waste, and making eco-friendly choices is growing but requires greater commitment from both consumers and industries.

In Bangladesh, the RMG sector has demonstrated the benefits of green investments, with green factories leading to increased efficiency, lower emissions, and improved working conditions. 

The industry hit a new milestone with two more factories receiving LEED (Leadership in Energy and Environmental Design) certification from the US Green Building Council, bringing the total to 200. 

Industry leaders expect more progress, as 500 additional factories are awaiting certification, with 18 securing recognition this year alone.

The government approved the Renewable Energy Authority Act in 2012 and initiated coastal green belt development. A five-year waiver was granted for commercial renewable energy production. 

Solar power and biogas plants are being set up, and the Clean Development Mechanism project, launched in 2013, focuses on making compost from municipal waste. Brick kilns are being modernised to reduce pollution, with banks stopping loans to outdated kilns.

Bangladesh Bank doubled its refinancing capital for green products between 2012 and 2016, supporting eco-friendly kilns, renewable energy, and waste management. Environmental and social risk management policies were introduced to promote green financing and identify harmful carbon-emitting enterprises.

However, much of the economy and daily life still rely on unsustainable practices. To make the economy and lifestyles greener, Bangladesh must focus on improving waste management, reducing reliance on fossil fuels, and promoting sustainable agricultural practices.

Is the transition happening fast enough?

Globally, significant progress has been made towards a greener economy, but the transition is not happening fast enough to meet the urgent challenges posed by climate change. 

According to recent studies, greenhouse gas emissions must be cut by 45% by 2030 to limit global warming to 1.5°C above pre-industrial levels. While some countries have set ambitious targets, others lag behind, and global emissions are still on the rise.

Countries like Germany and Denmark have made significant strides in transitioning to renewable energy, while China leads the world in solar energy capacity. The European Union has implemented strict carbon regulations and is investing heavily in green technologies. 

The strategy for a climate-resilient green economy

A climate-resilient green economy seeks to minimise vulnerability to climate change while fostering economic growth. This requires comprehensive policies that integrate climate adaptation into economic planning. 

Such strategies focus on reducing the carbon footprint, enhancing disaster preparedness, and investing in green infrastructure. Bangladesh, for instance, has recognised the importance of green development as a pathway to sustainable growth. 

While the country has made commendable progress, particularly in the RMG sector, it still faces considerable challenges.

Bangladesh's economy has grown significantly over the past decade, achieving lower-middle-income status and reducing poverty rates. 

However, this progress has come at the cost of severe environmental degradation, making the transition to a green economy even more crucial. 

According to a draft strategy, Bangladesh will need billions of dollars to achieve its green economy goals. The strategy emphasises investments in renewable energy, green infrastructure, and sustainable agriculture as key areas for future growth.