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Pixabay / Manuel Dario Fuentes Hernandez

“We have a rare and short window of opportunity to rebuild our world for the better”

- António Guterres, United Nations Secretary-General

Not undermining the challenges posed by COVID-19, there is an opportunity at hand to reconsider and reorient development priorities for a sustainability transition. A confluence of both demand and supply side shocks offers a unique opportunity to reshape production and consumption by investing fiscal resources and leveraging private investment towards more sustainable avenues. This was the key message in ESCAP’s flagship report Economic and Social Survey of Asia and Pacific 2020: Towards sustainable economies, discussed in the context of Pakistan at a recent virtual policy dialogue organized by ESCAP and the Sustainable Development Policy Institute. Only a sincere effort to push these messages could help the country’s transition towards sustainability.

Incentivising sustainable value chains

Pakistan is a high waste producing country, generating about 20 million tons of solid waste annually. While the country developed a National Action Plan on SDG 12 (Sustainable Consumption and Production) in 2017, a paradigm shift in production value chains is needed to implement the Plan. Pakistan needs a push towards bringing circular economy principles in practice, which can be complemented by a lifecycle approach to assess the impacts on environment, societies, and businesses.

Promoting sustainable production methods requires all policy levers. The Federal Ministry of Commerce and the Ministry of Industries and Production need to step up the game by developing responsible trade and industrial policies that address sustainability needs. For doing so, a strong evidence-base is required to evaluate and enhance the local capacity to build greener and more sustainable. Here the role of think tanks and research organizations would be important. At the same time, global and regional cooperation in harmonizing environmental standards and deploying carbon-neutral technologies can critically complement national efforts.

Fiscal authorities can incentivize value chains that are sustainability-oriented by restructuring tariffs, para-tariffs and regulatory measures to push for the desired change. Phasing out of fossil fuel subsidies and putting a price on carbon can accelerate this change and induce the kind of technological progress that can bring down future transition costs. The trade-offs between regular production modes and sustainable production modes need to be widened to promote the latter, provided that enough local capacity is developed to produce for the burgeoning population in a sustainable manner.

The State Bank of Pakistan has a key role to play by introducing credit facilitation for innovative enterprises that use clean technologies. Some avenues for change include a targeted credit guarantee scheme for refinancing and rationalized collateral requirements. To ensure that the sustainability transition is also a just transition, particular firms and sectors can be prioritized, for instance: small and medium enterprises that are at the start-up or scale-up stage, women-owned small enterprises that use clean production techniques, and particular sectors such as agriculture and livestock which are both labour intensive and have high scope of contributing to clean production. A research opportunity arises here to evaluate the credit gap that exists for micro, small and medium enterprises that focus on sustainable production.

Advocating a behavioural change for sustainable consumption

For augmenting the sustainability transition, the role of consumers is equally important. There is a dire need of bringing about a change in lifestyle practices in Pakistan. For this, extensive advocacy campaigns focusing on sustainable consumption choices need to be initiated that promote a culture of reuse and recycling, along with penalties for environmentally irresponsible practices. The plastic-bag ban in Islamabad, for example, is a step in the right direction that needs to be upscaled to the national level to create a meaningful impact. Eco-labelling in Urdu should be made mandatory in all TV and media advertisements for products to promote informed choices by citizens. Reuse mechanism of grey water in housing construction could be made mandatory to reduce water-waste at the household level.

In addition, social accountability needs to be strengthened to ensure a healthy transition towards the practices of reusing and recycling, in which think tanks and other civil society organisations can play an active role. Indeed, the collective action of all stakeholders would be critical for the sustainability transition.

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Daniel Jeong-Dae Lee
Economic Affairs Officer
Ayesha Qaisrani
Senior Research Associate, Sustainable Development Policy Institute (SDPI)
Vaqar Ahmed
Joint Executive Director, Sustainable Development Policy institute (SDPI)
Macroeconomic Policy and Financing for Development +66 2 288-1234 [email protected]