Environmental indicator report 2014

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Courtesy of European Environment Agency (EEA)

Across the world, there is growing recognition that the prevailing model of economic growth, grounded in ever-increasing resource use and pollutant emissions, cannot be sustained indefinitely. In the coming decades, with global population expected to increase to 9 billion people from 7.6 billion today, continued improvements in living standards and well-being will depend on a transition to a green economy globally that can meet society's needs while preserving the natural systems that sustain us.

Increasingly, this ambition is reflected in policies and initiatives at all levels of governance. In Europe, for example, the European Union's 7th Environment Action Programme (7th EAP) includes the vision that in 2050, we live well, within the planet's ecological limits and the priority objective of turning the EU into a 'resource-efficient, green and competitive low-carbon economy'.

To examine what the concept of green economy means in practice and evaluate Europe's progress in achieving this transition, in 2012 the European Environment Agency (EEA) initiated a new series of environmental indicator reports. The first two reports in the series focused on green economy and the European environment, addressing resource efficiency and resilience (EEA, 2012a), and the links between European resource demand, environmental degradation and changes in human health and well-being (EEA, 2013d).

This report provides another perspective on the green economy transition, addressing the global value chains that meet European demand for goods and services. In doing so, it goes beyond previous reports and analyses to address the global dimension of Europe's economic activities. This perspective is highly relevant because European production and consumption systems rely heavily on imported resources and goods. In doing so, the related environmental pressures from these systems largely affect other world regions, while European consumers are unlikely to have much knowledge of these impacts and European policymakers have relatively little authority to influence them. The continuing globalisation of trade flows therefore creates a significant challenge for environmental governance.

The analysis in this report focuses on selected productionconsumption systems, which link environmental, social and economic systems across the world — generating earnings, supporting ways of living, and meeting consumer demands — and also account for much of humanity's burden on the environment. Production and consumption are addressed together because they are highly interdependent. Only by adopting an integrated perspective is it possible to get a full understanding of these systems: the incentives that structure them, the functions they perform, the ways system elements interact, the impacts they generate, and the opportunities to reconfigure them. The overall objective is to highlight ways that production-consumption systems can be adjusted to augment societal benefits and minimise societal costs.

Assessing the environmental and socio-economic impacts of highly sophisticated, global production-consumption systems presents significant knowledge challenges. Whereas there are established indicators to track environmental pressures from production in Europe, indicators that capture the pressures embedded in imported raw materials and goods are far less mature. Nevertheless, the data available allow an interesting picture to emerge from the drivers that shape production-consumption systems, the (positive and negative) pressures and impacts caused by these systems, and the types of tools that can help to mitigate these pressures and impacts.

Part 1 of the report investigates the overall trends in productionconsumption systems in Europe and related environmental pressures. It explains how these systems are influenced by an array of interlinked factors, including economic, technological, demographic and sociological factors, as well as global megatrends.

Part 2 presents three selected production-consumption systems: food, electrical and electronic goods and clothing. These are productionconsumption systems with large shares of imports to the European economy and are especially characterised by the globalisation of their supply chains. Together the three systems account for a considerable share of the pressures and impacts of European productionconsumption systems on the environment.

For each of the three production-consumption systems, available indicators are used to describe the characteristics and trends of the specific system, as well as the trends and hotspots of related environmental pressures and impacts. This quantitative analysis is accompanied by an assessment of opportunities to move these systems in a more sustainable direction.

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