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Green growth


Green growth sustainable resource extraction and the role of trade unions NFS Conference Ilulissat, Greenland 24 April 2013 B la Galg czi – PowerPoint PPT presentation

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Title: Green growth

Green growth sustainable resource extraction
and the role of trade unions
  • NFS Conference
  • Ilulissat, Greenland
  • 24 April 2013
  • Béla Galgóczi

  • Structure of the presentation
  • Background we have only one planet, not five!
  • Resource and material use (the reckless
    exploitation of natural resources) cannot go on
    as in past
  • Green economy, green growth, green jobs
  • Green transformation double challenge for trade
  • Resource extraction, mining what are the major
    social and environmental challenges
  • The case of Greenland
  • What trade unions do and could do?

Background Revision of growth model
  • Long term challenge a fundamental revision of
    previous growth model, above all face the
    challenge of climate change,
  • The Great Transformation of the next decades will
    be the
  • transition to low (zero) carbon economy
  • Green growth a strategy to promote
    eco-industry, clean energy and also give push
    to green restructuring of traditional sectors
  • In 2011-2012 we see the danger of a reversal of
    green policies in Europe what we see is black
    austerity where incentives and subsidies into
    the green economy are cut back for sake of fiscal
    consolidation and affordable energy gets fake
    priority (e.g. Italy, Spain)
  • This is in sharp contrast with 2009 green
    stimulus packages
  • We also see a revival of fossil fuel (shale) gas
    and coal

Track record the challenge is bigger then
assumed by mainstream policy scenario
  • It is clear that on basis of current policy
    scenario the world is heading for a 3.5-4C
    temperature increase by 2100 (IEA, 2012)
  • Keeping the 2C target requires four times higher
    rate of future decarbonisation (reduction of CO2
    emitted per unit GDP).
  • Global ghg emissions keep on growing
  • Ghg emission reductions in Europe were more due
    to crises then to systematic implementation of
    climate policy no signs of decoupling economic
    growth from emissions
  • Huge gap in Europe in term of resource
    productivity (Bulgaria -Luxembourg 130), but
    diversity also in per capita emissions, although
    in a reverse order Luxemburg has the highest
  • No paradigm change visible yet

CO2 emissions from fossil fuels and cement in
MtC/yr (TgC/yr), 1980-2008
Source Eloi Laurent (2012) and Raupach et al
Looking beyond 2020 the 2050 Low-Carbon Roadmap
(ghg emissions in of 1990 level)LONG WAY TO GO
  • 80 domestic reduction
  • in 2050 is feasible
  • With currently available technologies,
  • With behavioural change only induced through
  • If all economic sectors contribute to a varying
    degree pace.
  • Efficient pathway and milestones
  • -25 in 2020
  • -40 in 2030
  • -60 in 2040

Performance in decoupling economic growth from
resource and material use in Europe
  • No major progress in decoupling, as the next
    graph for Europe shows
  • Only Germany, Italy, the Netherlands, Hungary and
    Luxembourg achieved absolute decoupling (economy
    grew with less resource use)
  • In decoupling, Nordic countries were not
    performing well DK, SE and FI all performed
    worse than the EU27 average and with economic
    growth they also used higher resources
  • It is a general problem that no (hard-core)
    incentives for higher resource productivity
    exist companies are good in increasing labour
    productivity, but not resource productivity!

Yearly average change of domestic material
consumption and GDP between 2000 and 2007 by
member state
no decoupling
relative decoupling
absolute decoupling
Source Eurostat (2011)
The bulk of the adaptation is still to come
  • Current climate policy tools are clearly not
    enough to reach target. If we had those (and they
    would be also implemented), their effects would
    be also harsher than what we see now!
  • The major challange for the employment effects of
    the green transformation is this uncertainty
  • Some principal questions
  • Decarbonisation through desindustrialisation??
  • Downscaling energy intensive activities or to
    improve energy efficiency and resource
    productivity efficiency while keeping and
    developing them (we need to make sure the second
    option will apply)
  • Address carbon leakage

Green jobs the positive agenda
  • Takes a narrow perspective on employment effects,
    looks at the labour market in a singular and
    segmented way in isolation from the rest of the
  • Definition problems
  • Process or product based view? (with view to
    their positive climate/environment effects), e.g.
    are the following green jobs?
  • Steel industry (with inputs to eco-industry
  • Construction industry (depending on product and
    technology what and how you build)
  • Financial services /?/, IT services
  • Focusing on green jobs by investments into a
    green economy (taking the opportunities arising
    from a new expanding sector) is indeed a useful
    policy, BUT it is only PART of the FULL STORY
  • The green transformation should encompass the
    entirety of the whole economy

Challenge for trade unions in the broader context
of the green transformation
  • Tension between their role as broad social actors
    and as membership organisations (e.g. Canada oil
  • Path dependency? In industrial societies trade
    unions fought the fair share of labour within the
    growth based resource wasting production and
    consumption model in the past
  • Are they still locked-in in that role /as some
    NGO-s state/?
  • The tension appears between the role of
    supporting more determined and ambitious climate
    policy on the one hand, but protect jobs that
    might come under pressure as a consequence, on
    the other
  • In this context we also see divergergent
    positions at different levels of TU organisations
    /international, national, branch level/

Trade union role the positive agenda active
policy role and social dialogue to meet the
  • Trade unions (especially at higher organisational
    levels) are engines of green policy at national
    and international level (ETUC, ITUC, national
    unions as TUC, DGB, Nordic unions)
  • Good practices at company level Green
    workplace project/initiative by ETUC, tools,
    manuals for trade unions
  • Managing restructuring on enterprise level under
    pressures of globalisation, especially in
    countries with strong workers participation
    patterns (successful plant level practices during
    the crisis in Germany, Austria, Nordic countries)
  • The Green Transformation is the most
    comprehensive restructuring process ever faced
    and will go on in the following decades trade
    unions should promote this process actively!
  • A socially responsible and just transition to a
    low carbon economy is a vital interest for trade
    unions but posing also huge challenges for all
    actors managing this process including workers

Innovative alliances between NGO-s and trade
  • Trade unions are committed to more ambitious
    climate policy at the same time demand a
    framework that provides a balanced approach just
  • This makes a comprehensive policy approach
    necessary climate employment social
    industrial policy
  • Just burden sharing during the transition - job
  • Trade unions developed practices of managing
    change and managing transitions /they are not
    anymore clinging to preserve status quo/
  • Innovative approaches TU-NGO alliances
    /Green-Blue Alliance in US (also at company and
    project level), Spring alliance in Europe (now on
    EU policy level)

Sustainable mining and resource extraction
  • The priority of a greening economy is to produce
    (more) value out of less material and resource
    input through higher resource productivity and
    efficiency, through changing behaviour,
    consumption and mobility patterns
  • What we see nowadays is a new race for resources,
    a mining and gas boom
  • US and Canada gas fracking boom, new oil pipeline
    to boost consumption
  • Extraction in Africa by Chinese firms is
    expanding rapidly
  • Brazil sees ist future in the new oil and gas
    field explorations
  • Mongolia is said to become the Saudi Arabia of
    rare earthes
  • Greenland and the wider Arctic region is the next
  • Not a healthy trend, BUT still (or even more so)
    we need to address the case of sustainable
    mining and resource extraction and trade unions
    need to develop a strategy for this!

Sustainable mining and resource extraction
  • What is at stake, where trade unions must be
  • - financial transparency (in order the benefit
    of the extracted natural values contributes to
    the wealth of the local population and not (only)
    to the profits of multinational companies
  • - technological safety (preventing natural
    catastrophes), limit exposure of workers to
    health and safety risks
  • - labour standards, working conditions, fair
    pay, decent work
  • - environmental standards (least possible
    intrusion into the ecological balance of the
    environment, recultivation of landcape and soil,
    preserving biodiversity)
  • - special attention to pristine natural
    environment (Alaska, Amazonia, Greenland)
    especially if the environmental balance of the
    region has an impact on the whole planet

Greenland the challenge of mining and resource
  • There is a new goldrush for mineral resources
    worldwide (US, Canada, Brazil, Mongolia and now
    also Greenland)
  • A vice President of a global mining company on
  • Greenland offers relatively low corporate taxes,
    and an environment that requires no royalty
    payments or the challenge of having to deal with
    Aboriginal land claims issues. Permits can also
    be secured within a six-month window.
  • Question is it necessary to enter into this
    race? Go for more and more resources just to feed
    the appetite of a resource wasting production
    model? Instead of embarking on a new growth model
    based on resource productivity and efficiency?
  • Sure, there are economic realities, Greenland
    wants to create an independent economic fundament
    and given its natural resources their
    exploitation seems to be unavoidable for the
    well-being of ist 58 thousand population

Greenland mining and resource extraction projects
  • Although not one mining or oil project started
    yet, more than 100 exploration licenses were
  • The big hope for the mining companies now is that
    Greenland will permit to extract uranium as a
    by-product from rare earth deposits (largest in
    the world outside of China that now has 90 of
    global production.
  • Alcoa plans to bring 3000 workers from China.
  • Greenland Minerals and Energy Ltd. - plans to
    extract 40,000 tons of rare earth metals per
    year, with some uranium as a by-product.
  • Hudson Resources, (White Mountain) - access to
    27.4 million tonnes of rare earth minerals.
  • London Mining Plc. - 2 billion Isua iron-ore
    project 700 permanent jobs, 2,000 Chinese
    workers for its construction.

Sustainable mining and resource extraction
Canada - a conflict case for trade unions
  • Conflict case, Keystone XL Oil pipeline, Canada
  • The development of tar sands oil supply (twice
    the amount of carbon dioxide as other oil
    reserves) is a huge risk for the climate...
  • Unions should not only bear the interests of
    their own members in mind, but also wider risks.
    To offer support for the Keystone XL pipeline,
    the AFL-CIO won a few construction jobs and a
    little money at huge external costs
  • The Murray River coal project (Canada) create up
    to 600 permanent jobs, and in 30 years three
    billion tonnes of coal. Chinese investment and
    the project was welcome, only the workers not,
    (Trade unions filed a court case against the use
    of foreign workers but support the project).
  • LESSONS for TRADE UNIONS for the proper BALANCE

Sustainable mining and resource extraction tools
for trade unions
  • Sustainable mining principles, guidelines
  • Extractive Industries Transparency Initiative
    (EITI) 32 countries produced EITI reports, from
    Europe only Norway (Greenland should join!)
  • The EITI Criteria
  • -Regular publication of reports on all material
    oil, gas and mining payments by companies to
    governments (payments)
  • -Civil society is actively engaged (design,
    monitoring and evaluation)
  • -A public, financially sustainable work plan
    developed by the host government
  • OECD, International Investment Agreements Survey
    of Environmental, Labour and Anti-corruption
    issues, 27 February 2007
  • ITUC Briefing note on Bilateral Investment
    Treaties (BIT)
  • New BITs must contain clauses in respect of OECD
    Guidelines for Multinational Enterprises and the
    ILO Tripartite Declaration of Principles
    concerning Multinational Enterprises

Sustainable mining and resource extraction
summary of challenges for trade unions
  • Addressed (even if not fully) transparency,
    distribution, direct environmental effects on
    population, flora, fauna
  • For direct safety risks and related direct
    environmental effects also have attention (like
    oil spills, or water contamination) push for
    higher standards through lessons (Deep Water
  • Less focus however on long term consequences and
    environmental impacts here we only have
    one-sided declarations and corporate social
    responsibility initiatives from companies this
    is clearly not enough, TU-s should push for more
  • BUT Towards Sustainable Mining (TSM) reporting
    (Canada) for mining companies is useful needs
    to be binding (trade unions to urge)
  • For social aspects we have the ILO norms as
    basic guidance, European social standards and
    national standards (either by Labour Law minimum
    criteria or through collective agreements)

Greenland the challenge of mining and resource
  • Greenland is a special case from an other
    aspect, also it is a pristine landscape and its
    ecological balance is critical for the whole
    planet (in this regard only Amazonia is
  • It would be an illusion however that a proposal
    could be raised, as the aborted attempt at the
    Yasuni Natural Reserve (Equador) where a
    compensation of cca. 2.7 bn USD was discussed to
    prevent the project.
  • We cannot expect this in case of Greenland. BUT
    at least the limits of extraction activity should
    be addressed!
  • Nordic countries, Denmark and also the EU
    (although Greenland is not part of it) should pay
    more attention!
  • But the EU is more aiming at special mining
    rights in Greenland (not granted, but a
    Memorandum of Understanding on the EUs access
    had been signed in 2012)
  • The EU also rejected a ban on oil drilling in the
    Arctic region (October 2012)
  • PRESSURE on the EU from a NORDIC Alliance?

Greenlands large scale law relaxation labour
  • The Law on large-scale projects in Greenland
  • New legislation to encourage foreign investments
    in large-scale projects through reducing labour
    standards (only to building and construction
    activities linked to the exploitation of
  • The foreign workers will be entitled to the same
    labour rights as Greenlandic workers, (right to
    strike, to organize and collective bargaining).
  • BUT foreign employees, who are subject to a
    foreign CB agreement will be allowed to maintain
    the salary and employment conditions of their CB
    agreement if in accordance with Greenlandic
  • The foreign workers are also entitled to a
    certain minimum wage equivalent to the
    Greenlandic (with a limitation on possible
  • Local trade unions, employer's associations and
    NGOs are entitled to have access to the
    collective agreements.

Greenlands large scale law relaxation labour
  • Issues for trade unions
  • It is a fundamental question however do resource
    extraction investments need special treatment and
    preferences? (possibly no)
  • Incentives by countries to attract manufacturing
    investment is a different matter (these can be
    moved) - not relevant for resource extraction)
  • Greenland has unique rare earth deposits, it does
    not need to give away concessions cheap! Why
    preferential treatment? Is the Large scale law
    necessary? More self-confidence needed!
  • Mining only starts now, a broader impact on the
    wider environment is not yet to be expected, but
    it is already time to think about the limits
  • It is necessary to implement the highest
    environment and safety standards for the
    immediate effects (contamination of soil,
    water/ice masses, prevent possible spills, leaks,

Recommendations for trade unions
  • Clarify responsibility of investors in case of
    potential accidents
  • Recultivation obligations after extraction
    activity ends
  • For labour effects, Greenland has a different
    context then countries with a larger population
    (and population density)
  • The conflict situation in countries with larger
    population appears in the substitution effect
    between foreign and local labour
  • Preserving existing labour standards is an utmost
    priority, the danger of a crowding out effect by
    foreign labour is less the case
  • Investors should pay attention to include
    domestic labour and also provide training for
    tasks that can be performed
  • Local labour content maximisation according to
    potential should be a criterion!
  • USE the power of the Alliance of Nordic Countries
    to agree on sustainable mining and social
    standards also in Greenland
  • NGO-trade union alliances are ideal to increase
    influence on resource extraction, mining issues
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