I Will Have Again Opportunity to Talk

Abstract

For the economic recovery from the COVID-19 crisis to be durable and resilient, a return to 'business equally usual' and environmentally destructive investment patterns and activities must be avoided. Unchecked, global environmental emergencies such as climate change and biodiversity loss could cause social and economic damages far larger than those acquired by COVID-19. To avoid this, economic recovery packages should be designed to "build back improve". This ways doing more than getting economies and livelihoods quickly back on their feet. Recovery policies also need to trigger investment and behavioural changes that will reduce the likelihood of futurity shocks and increase society'south resilience to them when they do occur. Cardinal to this approach is a focus on well-being and inclusiveness. Other key dimensions for assessing whether recovery packages can "build back better" include alignment with long-term emission reduction goals, factoring in resilience to climate impacts, slowing biodiversity loss and increasing circularity of supply chains. In practice, well-designed recovery policies can cover several of these dimensions at once, such as catalysing the shift towards accessibility-based mobility systems, and investing in low-carbon and decentralised electricity systems.

ane. Governments' get-go priorities in tackling the COVID-19 pandemic have been to overcome the health emergency and to implement rapid economical rescue measures, the latter mostly aimed at providing essential liquidity and protecting livelihoods in the face of abrupt losses of income. Every bit the wellness crisis gradually abates in some countries, attention is now turning to preparing stimulus measures for triggering economic recovery. This policy cursory examines how these stimulus packages can create a recovery that "builds dorsum better", i.e. non only getting economies and livelihoods dorsum on their feet rapidly, just also safeguarding prosperity for the longer term. This ways triggering investments and societal changes that volition both reduce the likelihood of future shocks and improve our resilience to those shocks when they do occur, whether from disease or environmental degradation. At the heart of this approach is the transition to more than inclusive, more resilient societies with net-zero GHG emissions and much reduced impacts on nature. Other OECD policy briefs examine the role of environmental health in strengthening resilience to pandemics (OECD, 2020[1]) and COVID-19 and the low-carbon transition (OECD, forthcoming).

A more resilient economy depends on a shift to sustainable practices

two. In addition to the immediate human suffering caused by the illness itself and the loss of livelihoods for millions, the COVID-xix pandemic has too highlighted several cardinal vulnerabilities of our societies and economical system. Global interconnectedness has helped to create huge economic and social benefits for decades, albeit unequally, but also facilitated the rapid spread of the pandemic. More broadly, the speed and depth of the economic crisis have shown that a core principle of the global economic system – prioritising brusk-term economic growth and efficiency over long-term resilience – can accept huge societal costs. The precariousness of long and complex global value chains has been revealed, with many countries struggling to learn medical and other strategic supplies. Social inequalities have been exposed and rapidly exacerbated by the massive but uneven loss of employment, with the equivalent of more than than 300 one thousand thousand jobs potentially at risk (ILO, 2020[two]). Although this is not the first economic crisis to expose these frailties, the depth and latitude of the current circumstances have brought the issue of resilience and preparedness loftier in the public consciousness.

3. The exposed vulnerabilities are particularly sobering when seen in the light of an even bigger future threat to the global economy: environmental deposition driven by our current economic system. The globe's environmental emergencies are equally pressing as ever, even if they may seem distant during such a very homo crisis. The impacts of climate change, air pollution, biodiversity loss and poor ocean wellness already cause immense suffering globally and harbour further systemic vulnerabilities for the global economic system that could ultimately eclipse the current crisis. Physical and economical impacts from climatic change are already being felt, and some regions have experienced extreme conditions events at the same fourth dimension as tackling COVID-19, such equally super-cyclone Amphan in Bangladesh and Typhoon Vongfong in the Philippines (United nations, 2020[three]). Without structural changes to our economies, continued aggregating of greenhouse gases (GHGs) in the temper will pb to potentially catastrophic further impacts. While the economic shut-down has led to some widely-reported environmental improvements, such as reduced emissions of GHGs and air pollutants and less water pollution, these in themselves will have virtually no long-term touch on (Le Quéré et al., 2020[4]). If economical activity resumes every bit before, they are likely to be temporary and speedily erased. Indeed, GHG emissions rebounded and resumed growth in the backwash of the contempo economic crises (OECD, 2022 forthcoming).

iv. These interlinked ecology crises may also heighten the likelihood and likely impact of future infectious diseases. The economical pressures driving biodiversity loss and the destruction of ocean health can have cascading impacts on societies, and may increase the risk of future zoonotic viruses (those which bound from animals to humans) due to the expansion of human being activities leading to deforestation, combined with the increased need for and trafficking of wild animals (Jones et al., 2013[five]). Declines in local environmental quality, including air and h2o pollution, tin can influence the vulnerability of societies both to disease and to the furnishings of a less stable climate, with impacts likely to affect poorer communities more (OECD, 2020[1]).

5. Returning to "business organisation every bit usual" will not deliver a sustained long-term economical recovery that also improves well-being and reduces inequality. With massive stimulus packages starting to exist unveiled around the earth, governments, businesses and societies as a whole have both a responsibility and cocky-interest to not only look for near-term measures to shore-upwardly livelihoods and employment, just likewise to accept a step back and reflect on the political and economic driving forces leading to the electric current crunch.

vi. Despite encouraging signs from governments, businesses and citizens, recovery plans accept so far mostly fallen brusque. Many governments take recognised the need and opportunity of a sustainable recovery. For example, in Apr 2020, the G20 Finance Ministers agreed to "commit to support an environmentally sustainable and inclusive recovery" (G20, 2020[vi]). Encouragingly, an international poll covering developed and developing countries also suggests that a majority of citizens see a focus on environmental issues as a continued priority as nosotros emerge from the COVID-19 crisis (IPSOS MORI, 2020[7]). The fragilities exposed by the pandemic may act to underline the reasons that ecology problems were condign top political priorities around the globe before COVID-19 struck. In 2019, millions of people, spearheaded by youth, protested in the streets for climate action, leading to several governments officially declaring a "climate emergency". Biodiversity loss and the ongoing mass species extinction were also gaining headlines effectually the world, and the visible crisis engulfing the globe's oceans had become a front end-line political issue in several countries. As recently equally Jan 2020, climate change and biodiversity loss topped the Globe Economic Forum'southward list of global risks (World Economic Forum, 2020[eight]). The social and economic case for a sustainable, resilient recovery is very clear. Despite this, economic recovery measures proposed so far have mostly scored poorly on environmental metrics, with unsustainable support outstripping sustainable measures in many countries (Vivid Economics, 2020[9]). While in that location is significant back up for "green" technologies and industries, in particular in European countries, in many cases this is outweighed by ongoing support for "brownish" activities that may lock-in emissions intensive pathways.

"Building Back Better": key dimensions for a resilient economic recovery

7. The term "Building Back Better" has been increasingly and widely used in the context of the economic recovery from COVID-19 (WRI, 2020[10]) (Nosotros Mean Concern Coalition, 2020[11]). The notion originated in the context of recovery and reconstruction from physical disasters1, with an emphasis on making preventative investments that improve resilience to, and then reduce the costs of, future disasters. The challenge of re-igniting the global economy in the aftermath of the economic crisis triggered by COVID-19 is of course different. There has been no physical disaster, and the focus is global. Still the economic crunch is and so severe, the risks from returning to previous patterns so high, and the opportunity to embrace a more sustainable recovery so clear, that the term is relevant in this context. Even at the global level, there is yet an emphasis on prevention, as the investments and behavioural changes made volition pay dividends in the hereafter through reduced exposure and increased resilience to costly future disruptions – whether due to climate change, disease, or a confluence of these or other factors.

viii. To "build dorsum better", recovery measures can be assessed beyond a number of cardinal dimensions (Figure 1). Common to all these dimensions is the need for urgent decisions taken today to comprise a longer-term perspective. For example, assessing measures confronting these dimensions tin expose where competing potential targets for stimulus spending may offer like most-term benefits in terms of job cosmos, but very dissimilar long-term outcomes for sustainability and resilience (for instance, whether or not the stimulus leads to investment in long-lived high-emitting infrastructure that may lock-in GHG emissions far into the time to come).

Figure 1. Central dimensions for Building Back Better

ix. A cardinal dimension of building back better is the need for a people-centred recovery that focuses on well-being, improves inclusiveness and reduces inequality. To better public support, recovery policies need to be measured on more than but economical growth and total job creation. Emphasising other elements that meliorate well-existence, such every bit income, job quality, housing and health is important to achieve this (OECD, 2020[12]). More specifically, where stimulus packages target environmental objectives, a focus on people'south well-being is also crucial to cement the social and political credence of ecology measures (OECD, 2019[13]). Even earlier the crunch, the touch of environmental policies on inequalities amidst and within countries, and between genders, was a mounting central business in several regions, and this is even more critical in the current context. Means for ensuring that environmental measures are socially inclusive include making taxes and subsidies progressive (supporting the nigh vulnerable) and preparing the workforce for the green transition, for instance by adapting and adopting "Just Transition" principles refocused for an era of economic crisis and recovery (OECD, 2017[14]).

10. The relative importance of the other dimensions will likely vary beyond different country contexts, according to their development priorities, infrastructure needs and social circumstances, in particular for developing countries. These dimensions include:

• Aligning recovery measures with long-term objectives for reducing GHG emissions. Avoiding the worst impacts of climate change is primal to time to come resilience and stability. A conscientious assessment of the influence of stimulus packages on future GHG emissions trajectories is crucial, including in the context of moving towards net-nothing emissions. This relates both to most-term emissions of economical activities receiving liquidity back up, as well as long-term structural implications of potential lock-in through infrastructure investment decisions facilitated by recovery packages. The long-lived nature of infrastructure investments probable to be fabricated through stimulus packages means that decisions made at present will accept implications for decades to come, and could determine whether the world can achieve its goals of averting the worst impacts of climatic change.

• Strengthening resilience to the impacts of climate change. Resilience to climatic change is i specific aspect of improving the overall resilience of economies and societies. In particular, infrastructure networks will face increasing pressures from the impacts of climate change, but also play an important role in building society'due south resilience to those impacts. Infrastructure investment is likely to be a fundamental component of recovery measures in many countries – in part considering of task creation potential – and it is important to ensure that infrastructure investments are climate resilient and exercise not increase exposure and vulnerability. This will reduce direct economic damages from climate related disasters and minimise the indirect costs created by the cascading impacts caused past the disruption of both disquisitional services and economical activities. New infrastructure investments, including in low-carbon developments, need to build in resilience against time to come climate impacts, past assessing climate risks beyond the lifetime of the project. Retrofitting existing infrastructure is more costly, both organisationally and in terms of physical investment (OECD, 2018[xv]).

• Integrating more than ambitious policies to halt and opposite biodiversity loss and restore ecosystem services, including through nature-based solutions. Biodiversity and ecosystem services are fundamental to economic activities and human wellness; deforestation and other land use change accept been linked to the spread of diseases. Investment in natural infrastructure such every bit reforestation and wetland and mangrove restoration are non simply a cost effective and sustainable fashion to improving resilience to climate impacts, merely offer employment opportunities similar to man-made infrastructure investments. Investments targeted through stimulus packages need to better assess and value biodiversity and ecosystem services, and integrate these values into decision-making. In improver, government support that is potentially harmful to biodiversity must be identified and reformed. Additionally, valuing natural capital is integral to improving a range of environmental health dimensions that are important for societal resilience to pandemics and other shocks (such as cleaner air and h2o (these bug are covered in detail in some other policy brief (OECD, 2020[1]))

• Fostering innovation that builds on enduring behaviour changes. Continued technological and procedure innovation will be critical to achieving climate and other sustainability goals. Governments play a central role in fostering an innovation ecosystem, well beyond funding basic research and development (OECD/The World Depository financial institution/UN Environment, 2018[16]). However, the COVID-nineteen pandemic will touch on cultural norms and behaviour in ways that are not however known. To exist effective at creating jobs and improving resilience, stimulus packages need to take into business relationship potential behaviour changes that could bear on the saliency of unlike policy measures, including for innovation. For example, tackling reluctance to take public send by encouraging measures to reduce crowding, improve hygiene and to encourage "active" send modes; introducing measures that better back up remote working (including well-existence aspects) in club to reduce demand for transport such as encouraging remote working and events.

• Improving resilience of supply chains, including through increased adherence to round economy principles: the COVID-19 pandemic and containment measures accept raised new questions about the systemic resilience of circuitous global production methods and value chains, triggering renewed interest in more than diversified and more localised production and shorter supply bondage in certain sectors. The environmental implications of such a shift are far from clear, but there is a role for policy, including through stimulus packages to ensure that local supply bondage do genuinely improve resilience and reduce ecology impacts, including by improving resource efficiency and increasing circularity of supply chains.

11. Fortunately, designing stimulus measures in this way does not mean starting with a blank slate. International agreements already exist across many of these dimensions, such every bit the Paris Agreement on climate change, the Aichi Biodiversity Targets, and the Sendai Framework for disaster risk reduction. The UN Sustainable Development Goals likewise provide an overarching compass for ensuring that social evolution and well-being is fully integrated with environmental objectives. In terms of policy measures, many of the needed actions to build back meliorate and improve resilience through stimulus packages can build on existing cognition of policy design implementation. For case, although GHG emissions were growing until 2019, the feel from more than 2 decades of designing and implementing climate responses and assessing their effectiveness remains relevant. Similar policy knowledge exists for halting and reversing biodiversity loss, and improving circularity of cloth use, among others. Additionally, there are some key lessons from ecology measures integrated into stimulus measures following the global financial crisis in 2008-09 (Agrawala, Dussaux and Monti, 2020[17]).2

"Building Back Ameliorate" in practice

12. This section provides some key examples of opportunities for "building back amend" beyond sectors, highlighting where public stimulus spending could be oriented to align across several of the above dimensions simultaneously. These examples are clearly non exhaustive, but are highlighted hither because of their relevance for where stimulus investments tin can catalyse important systemic change in economical sectors while as well meeting the urgent need for creating employment, or otherwise trigger changes necessary to support longer-term resilience outcomes. While these examples cover a wide range of specific policy areas, some overarching policy guidance is provided in Box 1.

Enhancing biodiversity while ensuring a resilient supply of food

13. Biodiversity and natural infrastructure such equally forest, wetland and mangrove ecosystems, are essential inputs for many economic activities, and are central to hundreds of millions of livelihoods. Natural ecosystems are also essential pillars of resilience. Yet virtually of this natural capital is undervalued in the economic system, or valued only as a harvestable commodity and not for the vital ecosystem services provided. The unpriced natural capital consumed by main production (agronomics, forestry, fisheries and mining) and some primary processing sectors (including cement, steel, lurid and paper) was valued at USD 7.3 trillion in 2013 (Natural Capital letter Coalition, 2016[18]). However, despite the introduction of some policies to value biodiversity, in particular through payments for ecosystem services, most existing approaches to measure and value natural capital loss remain express (OECD, 2019[19]). Through recovery packages, governments may have leverage to increase private finance for nature-based solutions and to enlarge the commitment of businesses and investors to measure out biodiversity impacts, dependencies, risks and opportunities, east.m. through conditions for financial support in recovery packages to agriculture and other sectors with shut links to biodiversity (OECD, 2019[19]).

What policy can do

While the multiple dimensions of "building dorsum better" span many specific policy areas, some key recommendations for governments to consider are:

• Screen all elements of stimulus packages for their longer terms implications across the central dimensions outlined above, prioritising deportment that:

  • Combine benefits for jobs and reducing inequality with implications for longer-term resilience, including by fugitive locking-in emissions intensive infrastructure and systems.

  • Can be implemented quickly, including "shovel-prepare" targets for public investment and existing policy frameworks that can be quickly scaled upwardly

  • Favour cantankerous-sectoral, cantankerous-regime approaches that take a long-term, systemic view rather than single technological outcomes

• Build pipelines of "shovel-ready" sustainable infrastructure projects: have co-ordinated cross-ministry activity to build pipelines of sustainable projects that can be implemented quickly, while avoiding favouring established emissions-intensive activities just because they are fast

• Maintain (and increase) ambition of long-term environmental objectives (including net-zero GHG emissions) and ensure that policies and investments triggered through stimulus packages are aligned with those outcomes, for example:

  • Avoid relaxing existing environmental regulations to provide near-term relief, as the costs of longer-term vulnerability volition oftentimes outweigh short-term economic relief

  • Make subsidies and other government support for specific industries conditional on both environmental improvements (including GHG emissions) and amend overall resilience (including for the workforce)

  • Make free energy pricing coherent as part of financial reorganisation mail-crunch, including phasing out fossil-fuel subsidies and building carbon pricing that includes social protections (east.g. using carbon pricing revenue to mitigate distributional implications for households, equally well as to finance support for structural adjustment of workers and communities).

• Actively support development of greenish finance flows to improve resilience, encouraging longer-term horizon for financial decisions:

  • Measure the consistency of investments and financing with climatic change mitigation and resilience, edifice on existing private and public sector initiatives (Jachnik, Mirabile and Dobrinevski, 2019[twenty])

  • Promote robust and transparent definitions and standards for greenish finance in social club to guide financial allocations and investment (including taxonomy approaches);

  • Increment potential for public finance to catalyse private investment by further empowering public finance institutions: eastward.g. past increasing lending authorization and ability to co-invest.

  • Increment and improve capacities to appraise, manage and publicly disclose climatic change-related financial risks, edifice on existing frameworks and approaches (e.thousand. TCFD, NGFS).

• Design public procurement processes that value both resilience and low-carbon every bit well every bit promoting innovation: for example ranking bids based costs over the nugget lifetime under different climate impact scenarios, and accounting for life-cycle GHG emissions.

• Provide specific support for reskilling and training for industries affected by the firsthand crisis and longer-term decarbonisation, along with supportive policies such equally reforming housing policies to encourage mobility.

fourteen. The food sector is fundamentally important for the conservation and sustainable use of natural majuscule, and ultimately dependent on it. Secure food supply is essential for well-being and economic stability – indeed even to sustain life – pregnant that the availability and affordability of food are likely to be central authorities priorities coming out of the crisis (OECD, 2020[21]).

15. The agronomics sector faces growing threats including from climate change and infectious diseases of plants and livestock. It is likewise a major driver of environmental degradation. State-use modify, including for agriculture, is responsible for a large role of deforestation. Furthermore, excessive fertilizer use has important implications for freshwater and body of water ecosystems due to nutrient run-off. Increased ecosystem pressures due to agriculture could too have implications for potential creation of new human diseases. Agricultural expansion into zones close to wilderness areas increases pressures on biodiversity, and agricultural intensification, for case with denser livestock populations, tin increment the run a risk of zoonotic transfer of viruses across species (Jones et al., 2013[5]).

16. Agriculture already receives substantial government back up globally. In 53 countries analysed by the OECD, farmers received around USD 528 million in back up in 2019 (OECD, 2019[22]). In addition to securing jobs and preventing well-nigh-term supply disruption, recovery measures should aim to reshape policies in the sector to promote environmental sustainability and resilience, and innovation for improved productivity. In the context of the COVID crisis, in that location is potential to focus on reform of the nigh harmful and distortive measures, including but not limited to the reinforcement of coupled supports (i.e. those proportional to product or livestock), also equally the relaxation of ecology regulation. Such measures could otherwise contribute to locking-in unsustainable practices and delay the transition of food systems towards sustainable practices. Investments and training aimed at triggering farmers' transition to more sustainable agronomical practices would benefit the environment, climate, as well as farmers' livelihoods.

17. More generally, patterns of consumer food choices can be important levers for ambitious climate mitigation as well every bit for improving health and well-being through balanced diets. Where admission to sufficient protein is non an outcome, policies to promote lower-emission food choices may also assistance, such as encouraging more than institute-based food choices or shifting to sourcing from lower-emission livestock systems. Measures that could contribute to such objectives include public communication campaigns or education. It is also crucial that, governments address the consequence of food security for vulnerable populations. Food stamps and increased subsidies may likewise be an option to help vulnerable populations, every bit long equally physical access to salubrious nutrient and diets is ensured.

Investing for low-carbon, resilient electricity systems

18. Economic stimulus packages can assist accelerate the shift towards a zero-carbon, climate-resilient electricity organization while creating jobs. While big-calibration renewables remain important in this regard, distributed renewables, demand-side free energy efficiency and improving the flexibility of the power organization are as well important opportunities.

19. Free energy-related stimulus measures need to consider the changed context of the global energy system, with a historic reduction in free energy demand expected in 2020, contributing to extremely depression and volatile fossil fuel prices (IEA, 2020[23]). Indelible depression oil and gas prices reduce incentives for free energy efficiency and renewables, equally well as leading to reduced investment in fossil fuel industries. Energy investment is expected to decline sharply in 2020, even for renewables (IEA, 2020[24]). In this context, using stimulus spending to invest in and mobilise finance for 'shovel-ready' utility-scale renewables (eastward.1000. current of air and solar photovoltaic) remain key levers for a sustainable economic recovery. Only this is only part of the story. Stimulus packages can additionally seek to drive investment in other measures that accelerate decarbonisation while likewise improving resilience of the electricity arrangement, both to climate impacts and demand shocks such equally that triggered by the current crisis. Examples include energy efficiency, distributed energy resource and improving the flexibility of the ability organisation. In developing countries, measures that increase electricity access, including through off-filigree or mini-grid renewable systems, can have many benefits for employment, well-being, health and societal resilience ( (IEA, 2017[25]).

20. Energy efficiency is a articulate candidate for a green recovery package only it is essential to achieve climate goals and is often generally labour-intensive. More iii.3 1000000 people are employed in energy efficiency in the US and EU alone, most of them in pocket-size and medium sized enterprises (IEA, 2020[26]). Prioritising energy conservation and distributed energy resources also improves the resilience of the power organization while delivering on a number of well-being benefits (enhanced affordability, lower environmental footprint, lower investment needs in network infrastructure). Across ability, an important target for energy efficiency is the edifice sector (covered below). Free energy efficiency across the economy can also mean a switch to electricity for energy uses previously directly using fossil fuels, such as electrification in industry, roll-out of electric vehicles and electric oestrus pumps as part of edifice energy efficiency measures (IEA, 2018[27]). While this electrification trend tin can have substantial benefits for reduced air pollution at the point of utilise, the implications for GHG emissions depend on the decarbonisation of the underlying electricity organisation, too as its ability to handle the increased demand pattern.

21. Challenges to scaling up energy conservation and distributed energy resource during the recovery include the relatively small calibration of these projects and potential liquidity constraints for both households and firms. Governments could leverage on existing programmes, create 'project pipelines' of shovel-ready projects, and identify partners (e.m. utilities, municipalities, housing associations) and channels (e.g. free energy efficiency obligations, on-nib financing) that assist scale up the programmes in the short-term without creating a blast and bust cycle (IEA, 2020[26]). These measures can be accompanied past investments in training to reduce skill shortages in the ability and free energy sector, including for energy system engineers and building retrofit specialists.

22. Another important target for stimulus packages is public investment in flexibility of power systems. This can include electricity storage (notably lithium ion batteries, as well essential for electric ship), smart grids (e.g. rollout of smart meters) that are crucial for demand response, facilitating the integration of variable renewable energy sources and improving interconnection of grids. The lock-down measures imposed during the COVID-nineteen crisis have shone a spotlight on the importance of grid organisation flexibility, because falling demand has raised the share of renewables due to their priority acceleration and depression-running costs. Finally, innovation in the free energy sector is essential for technologies that volition exist essential for reaching net-zip emissions over the longer-term, including carbon capture and storage.

Energy efficient housing every bit role of compact, resilient and sustainable cities:

23. The confinement of hundreds of millions of people to their homes due to COVID-nineteen has highlighted major failures in the housing sector and illuminating social inequalities related to the quality and comfort of dwellings and building services such as sanitation. Situations where poor quality housing increases inequality by posing major threats for security and health have become e'er more than visible, including through indoor air-pollution, as well through increased living costs due to poor energy efficiency.

24. Cities, and the edifice sector more than broadly, are central targets for free energy efficiency improvements. Buildings account for nearly 30% of global CO_two emissions, both through straight called-for of fossil fuels for heating and indirectly through their electricity consumption (IEA, 2019[28]). To achieve the goals of the Paris Agreement, there is a strong need both for retrofit of existing edifice stock and for new builds to meet stringent energy-efficiency standards. Despite the clear benefits of investing in edifice efficiency, the barriers are well-known, including the need for upfront majuscule, behavioural inertia and divide incentives between landlords and tenants. In emerging economies, the investment gap for greenish buildings is estimated at USD one trillion annually co-ordinate to the IFC. While state contexts vary for both types of investments, policy gaps (e.g. the need for building standards and incentives for energy efficiency), and the need for robust and scalable business and financing models, are typically fundamental factors continuing in the way of accelerated investment. Stimulus packages could therefore be critical to invest in the massive retrofits needed to reduce GHG emissions from the building stock at the same time as improving living weather condition and creating jobs. Measures include straight grants, tax breaks for efficiency investments and potentially scrappage schemes for inefficient household appliances. Adept experience with such measures was gained from stimulus measures following the 2008 financial crisis (Agrawala, Dussaux and Monti, 2020[17]). Policy incentives for residential energy efficiency as well present articulate opportunities for attracting private sector investment ( (I4CE, 2020[29]).

25. More broadly, economic recovery measures need to consider better coordination between housing policies and wider urban planning. In many countries urban planning has led to sprawling cities, with structurally college GHG emissions and air pollution than dense cities, for several reasons including increased reliance on private cars. The COVID-19 pandemic could exacerbate this trend through an increment in demand for less dense neighbourhoods. For example, city dwellers may seek unmarried-family homes in less dense neighbourhoods, due to a perception of college infection hazard in more dense housing. This could run counter to efforts to curb GHG emissions and could create a tension between balancing future resilience with mitigation. Transforming cities into liveable places where people want to live and stay tin help get-go this trend and contribute to both decarbonisation, resilience and lower inequality. Measures could include integrating programmes to retrofit buildings every bit role of wider sustainable development plans for neighbourhoods. In addition, creating the conditions for the uptake of eco-districts, both as part of urban revitalization and new developments, can help to make cities attractive places to live, besides as improving resilience to climatic change impacts such as more intense heatwaves. Finally, promoting mixed land-uses and enhancing walking and cycling accessibility are central, providing back-up in send options that is a pillar of improved resilience, discussed farther beneath.

Catalysing the shift towards accessibility-based mobility systems

26. For passenger send, stimulus packages should aim to combine support for a transition to less polluting cars with investments that initiate a shift towards accessibility-based mobility. The automotive sector is a major global employer, bookkeeping for effectually xiv million jobs globally, and has been severely affected by the COVID-19 crisis (ILO, 2020[30]). Equally governments consider longer-term support for ailing car manufacturers, they can ensure that such support is contingent on ecology improvements including accelerating the shift to electric cars as well as more efficient, cleaner ICE vehicles. However, recovery measures should also embrace a shift towards mobility systems designed around accessibility (the ease of reaching jobs, services, leisure activities, etc.), rather than only emphasising an accelerated uptake of private electric vehicles. The latter would lock-in private vehicle ownership and depression-occupancy vehicle utilize. This would limit the overall emissions reduction potential of the send sector, and as well implies a less resilient system due to overreliance on one transport fashion. A mobility arrangement based heavily on private vehicles is also badly equipped to achieve other social and economical goals (east.m. reduced inequality, improve wellness and less congestion).

27. Investing in public ship remains essential both for mobility and for jobs: almost equally many people piece of work in public send as in the auto industry (13 meg) (UITP, 2017[31]). However, governments need to recognise new challenges for public transport, such as people existence reluctant to take mass transit for germ-free reasons (ITF, 2020[32]). Every bit well as urgent hygiene and social distancing measures, over the longer term fiscal support and infrastructure spending could be targeted to enhance capacity, reduce crowding and rebuild the appeal of public transport, particularly as chapters is likely to be strained while social distancing measures remain in identify (Liebreich, 2020[33]). Already some cities have benefited from traffic drops during the contingency stage to speed upwardly public transport projects, such as the Jitney Rapid Transit extension in Reno, and the metro construction in Los Angeles.3

28. Governments could also envisage cooperation with both public transport providers and businesses in two ways. Firstly, to support the shift towards public transport pricing schemes that make more efficient employ of transport capacity (due east.grand. peak/off-peak pricing) and secondly, to encourage more flexible working schedules and remote working where possible. In parallel, investment in electric vehicle charging infrastructure is a key opportunity for recovery packages, both for private vehicles and electrified public transport such as buses. Charging plans demand to have into account the opportunity cost for other modes also as public infinite used.

29. As economic activity resumes, there is an opportunity to reallocate road space and encourage active send, as a ways to create jobs, reduce emissions, improve resilience and even boost public wellness. At least150 cities effectually the earth take already taken emergency activeness to create temporary wheel lanes and other space for agile transport that allows for social distancing rules (ITF, 2020). To brand these temporary changes permanent, stimulus measures could support redesigning road infinite away from cars to more than sustainable modes (with a holistic view to enhance accessibility and promote rubber) and adequately price information technology, building on evidence from the air quality and route safety improvements due to COVID-19 lockdown measures. Active transport modes and micro-mobility (e.1000. electric scooters, bike sharing schemes) volition be primal to prevent a big shift from public transport to the car; supporting them with both investment and road reallocation is also important. R&D support could focus therefore in innovations around electric micro-mobility rather than exclusively on electric cars. Reconfiguration of road-space should too consider the demand to better accommodate freight movement (peculiarly of final-mile travel inside dumbo city areas) and ensure transition to cleaner fleets; peculiarly as urban freight volumes could increase with higher demand of eastward-commerce mail service-COVID. Pursuing an accessibility-based model, encouraging active and public ship modes, will also set a ameliorate context for advancing and increasing effectiveness of phasing out fossil fuel subsidies (where these are still in place) and implementing ambitious carbon prices (OECD, 2019[13]).

Improving resilience of supply chains while accelerating the shift towards circular economic system principles

30. The COVID-xix crunch has shone a spotlight on the resilience of global value chains, which accept get increasing complex and globalised in contempo decades. If firms seek to better resilience by shortening supply chains or making them more local, it will be important to ensure that such changes do not inadvertently increase emissions or other environmental impacts. Additionally, economic recovery policies may provide an opportunity to ameliorate resource efficiency overall, including through exploiting job cosmos possibilities related to the circular economy.

31. Producing and shipping raw materials and manufactured goods along global supply chains is a key colonnade of global economical activeness but besides a major source of environmental pollution. Materials management already accounts for nearly 2-thirds of global GHG emissions, and is projected to increment by two-thirds by 2060 nether current trends (OECD, 2019[34]). Despite widespread policy efforts to encourage greater recycling and circularity of both production and consumption, the rate of recycled materials globally remains low.

32. The pursuit of efficiency and minimised costs in recent decades has led to highly complex supply chains, ofttimes with global reach and concentration in Asia (peculiarly in the People's Commonwealth of Mainland china). This contributed to emissions reductions in developed countries, as some emissions were effectively "off-shored" to countries higher up the value bondage, considering emissions are unremarkably measured based on where goods are produced rather than where they are consumed. The resulting complex supply chains may in some cases exist more exposed to adventure of disruption, in office due to an accent on leanness and efficiency at the expense of redundancy and resilience. Some other cistron is the geographic concentration of upstream actors, significant for example that disruption of a single supplier can ripple across multiple supply chains. The sheer complexity of supply chains also plays a role, every bit companies lack awareness of all the suppliers and secondary suppliers in their supply bondage, making proper evaluation of chance challenging (Choi, Rogers and Vakil, 2020[35]). Yet, if firms seek to improve resilience by shortening supply bondage or edifice in redundancy, it volition nevertheless be of import to ensure that these changes practise not lead to increases in emissions or ecology impacts. For example, within the OECD area there is evidence that off-shoring led to overall reduction in emissions, due to relocation to regions with less GHG-intensive product (Garsous, 2019[36])

33. The recovery measures proposed past governments also present an opportunity to seek greater circularity in supply chains, which can act both to improve resource efficiency and resilience for businesses (by building greater resilience to supplier risks) and society (by reducing environmental risks). In circular value chains, waste is minimised and end-of-life products are recovered for reuse, remanufacture, and recycling. This is achieved through improved production design (e.g., for disassembly, remanufacturing and recycling) and increased efficiency in the use of material resources, which generates a number of benefits. The availability of recycled materials and products for reuse and remanufacture leads to new sources of supply and supports the diversification of supply chains. Circular value bondage as well assistance to accelerate climate mitigation via reduced primary textile production and opportunities to shift consumption towards product-service and other circular business models). Governments can catalyse the uptake of circular value chains via green public procurement (east.thousand., the Netherlands' Near Economically Advantageous Tender procedure), removing trade barriers on scrap, landfill fees, Extended Producer Responsibleness, and capacity building amid firms (OECD, 2019[37]); (Yamaguchi, 2018[38]).

34. An increased use of digital technologies for supply chain management can also improve resilience and reduce the likelihood of disruptions, by providing data to identify and evaluate a number of resource efficiency risks and opportunities. On one mitt, digitalisation lays the foundation for disclosure of climate-related risks past companies for example through the recommendations of the Task Force on Climate-related Financial Disclosure (TCFD). The recovery from COVID-nineteen opens an opportunity for governments to require both articulate deportment towards alignment with ecology policy objectives, as well as disclosure of climate-related risks every bit conditions for financial back up through recovery policies. Nevertheless, this would need to be applied cautiously in order to avoid hindering activity through administrative burdens, and so may be all-time applied to larger firms. On the other hand, automation and digitalisation of industrial processes often enhances the efficiency of product – including by heavy industry – thereby reducing emissions. Governments can catalyse this shift by attaching conditions on stimulus packages to increase the uptake of these technologies, besides as through targeted innovation policies. Still, as job creation is oft at the heart of stimulus measures, the implications of automation for the piece of work force would need careful consideration and active labour market management.

References

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Notes

← ane. Coined in 2006 in the aftermath of the 2004 Asian tsunami, by 2022 the term "Edifice Back Better" was in widespread use by the Disaster Risk Reduction (DRR) community and was incorporated into the priorities of the Sendai Framework for Disaster Risk Reduction (United Nations Office for Disaster Hazard Reduction, 2015[40]). Information technology generally refers to the recovery, rehabilitation and reconstruction phase after a disaster to increase the resilience of communities through the restoration of physical infrastructure and societal systems. In that context, there is evidence that disasters did pave the manner for regulatory and policy changes to raise resilience and invest in prevention (OECD, 2014[39]). The emphasis is non but on preventative measures to reduce toll of recover, but also on incorporating social and environmental improvements for increasing well-being of impacted societies.

← 2. The stimulus measures enacted post-obit the global financial crisis of 2008-09 included many examples of governments seeking to integrate aspects of sustainability, with varying degrees of success both economically and environmentally (Agrawala, Dussaux and Monti, 2020[17]). The similarities between COVID-19 and that crisis are however express. The nature of the economic and social crisis currently engulfing the world is fundamentally unlike, borne out of a deep and broad drop in demand right across the existent economy, rather than emanating from the financial sector. Importantly, the environmental outlook is also unlike than it was in 2008. More a decade afterwards, the need to act on climatic change and biodiversity is much more than urgent and more than broadly accustomed by the public. In addition ten years of technological development take seen vast cost reductions in fundamental technologies.

← iii. In Los Angeles, the COVID-19 crunch has helped L.A. Metro ( the transport authority) to overcome original opposition from residents, as speeding structure during this time will minimise construction impacts for local business when activities are renewed (Bliss, 2020).

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