The COVID-19 pandemic triggered an economic downturn with an uneven impact across the Arab region. It also offered an opportunity for a green recovery that could help lift Arab economies out of recession while decarbonizing, creating decent jobs, promoting equity, and enhancing community and infrastructure resilience. The extent to which Arab countries have set a pathway for green recovery is not fully clear from the adopted stimulus measures. Will Arab countries seize this opportunity and what should they consider for the medium and long term?
Directly related goals:
To counter the impact of the COVID-19 crisis and reinvigorate the economy, Arab governments have introduced economic stimulus packages of varying sizes, amounting in total to around 4 per cent of the regional GDP.[1] Whereas the immediate urgency of the pandemic may have temporarily diverted attention away from environmental priorities, and despite fiscal constraints, medium-term development plans formulated in the region in 2020 onwards have considered sustainability aspects. Building a better future post-COVID-19 entails supporting a green recovery through a range of systemic changes that will help avert future health, economic and environmental shocks.
“We have a chance to not simply reset the world economy but to transform it… COVID-19 recovery and our planet’s repair must be the two sides of the same coin.”
Secretary-General, “The State of the Planet” speech given at Columbia University, 2 December 2020.
Arab countries enacted various measures to support businesses stay afloat, including tax exemptions and reductions, waivers and reductions of government fees, rental subsidies, interest rate reductions, loans and interest deferment, and the extension of soft loans and credit support to increase liquidity.[2] A multitude of sectors were targeted including industry, tourism, transport, and to a lesser extent, agriculture and commerce. Examples include:
Waivers and reductions on utility bills for water, gas and electricity constituted a common measure across the region, and were often time-bound, with few countries easing related environmental regulation. For example:
There is little information on the environmental implications of the economic stimulus response to the COVID-19 crisis by Arab governments. However, anecdotal evidence suggests that they are likely to be negative or mixed (neutral at best), encouraging the consumption of resources and benefiting sectors that have a high environmental footprint. Global assessments have shown that governments have generally not used COVID-19 stimulus packages to shift their economies towards greener trajectories. [19]
Going forward, Arab countries need to weigh their responses to COVID-19 against a comprehensive frame that balances the dimensions of sustainable development and avoids reversing environmental gains achieved to date. Arab governments could:
Looking beyond immediate COVID-19 stimulus measures, it is clear that national development plans, voluntary national reviews of the 2030 Agenda and projects presented by Arab countries during 2020 and 2021 reflect actions to fulfil their climate commitments by increasing the share of renewable energy in the energy mix and enhancing energy efficiency, including through the promotion of businesses/industries and small and medium-sized enterprises (SMEs) that adopt sustainable and clean production methods. Another clear focus is the shift to green buildings and sustainable transport, as well as “net zero” projects. Examples abound, for instance:
Several Arab countries are seeking to rationalize water use in agriculture, including by investing in efficient irrigation techniques in countries such as Egypt[29] and Lebanon,[30] and in rainfed agriculture through increased rainwater harvesting in countries like Somalia.[31] Investment in water treatment and reuse as a measure to address water scarcity was also underlined by some countries, including Jordan,[32] Morocco[33] and Palestine.[34]
Other environmental dimensions of focus include solid waste management and, to a lesser extent, tackling air pollution, combatting desertification and protecting biodiversity.
Green finance initiatives are also being implemented in several Arab countries.
It is worthwhile noting that the crisis led some countries to cancel or postpone planned green projects.[48] A case in point is the abolishment by the Kuwaiti cabinet of plans to build the 1.5-gigawatt Al-Dabdaba solar plant, which was expected to generate 15 per cent of the electricity requirements of the country from renewable sources by 2030.[49]
The following actions are recommended for Arab countries:
On intersectoral issues and transboundary environmental problems: Further efforts are needed, including the formulation and/or strengthening of regional normative frameworks that support coordination between interdependent sectors. Setting obligations may be necessary for State parties to perform environmental impact assessments on specific undertakings, and alert and consult with each other on all prospective initiatives with a possible major cross-boundary harmful environmental impact. Ministerial Councils under the League of Arab States play an important role in this area. For example, Arab agriculture and water ministers recently agreed in the joint Cairo Declaration in 2019 to join hands against the impacts of climate change, land degradation and water scarcity by harmonizing policies across the water and agricultural sectors. [66]
On advancing a regional green agenda: Strategic initiatives could be identified that address shared environmental priorities for different country groupings. For example, in 2020 ESCWA launched a Climate/SDGs Debt Swap - Donor Nexus Initiative, aimed at supporting debt relief and enhancing climate finance in middle-income Arab countries with a high and growing debt burden. The initiative “converts national debt-serving payments on foreign debt into domestic investment for implementing climate-resilient projects through collaborative arrangements between debtors, creditors and donors”. [67]
On renewable energy and environmental protection technologies: A formal mechanism to support technology transfer within the region could be established to help advance environmental technology-based solutions in Arab countries and support building back greener and more resilient from the COVID-19 crisis.[68] For instance, the adoption of green technologies in agriculture, such as green fertilizers, rainwater harvesting, solar dryers, food bio-conservation, and small-scale food processing for fruits, vegetables and dairy products could help alleviate challenges related to scarcity of natural resources, access to agricultural inputs, and access to markets, among others. This would in turn build the resilience of farmers.
[1] United Nations, COVID-19 Stimulus Tracker. Available at: http://tracker.unescwa.org/ (accessed on 8 October 2021)
[2] Ibid.
[3] Oman, Ministry of Finance, “Economic Stimulus Plan”, 2021.
[4] PWC, “Oman: Budget 2021 & 10th Five year development plan (2021-2025) - continued focus on diversification & maintaining deficit”, 2021.
[5] United Nations, COVID-19 Stimulus Tracker. Available at: http://tracker.unescwa.org/ (accessed on 8 October 2021)
[6] El Watan News, 21 economic decisions announced by president el-Sissi to confront the coronavirus crisis, 22 March 2020.
[7] Gulf News, “Coronavirus: Sharjah's 47-point stimulus package suspends eviction judgments, jail rulings on all rental-related cases”, 31 March 2020.
[8] United Nations Office for the Coordination of Humanitarian Affairs, “COVID-19 Government Measures Dataset”, COVID-19 Pandemic, Humanitarian Data Exchange. Available at: https://data.humdata.org/dataset/acaps-covid19-government-measures-dataset (accessed on 19 November 2021).
[9] World Bank, “Social Protection and Jobs Responses to COVID-19: A Real-Time Review of Country Measures”, version 6, (Washington, D.C., World Bank, 2020).
[10] ESCWA, “Strengthening the capacity of the water and sanitation sector in Arab countries to deal with the COVID-19 crisis”, (E/ESCWA/CL1.CCS/2021/TP.6).
[11] Ibid.
[12] El Watan News, 21 economic decisions announced by president el-Sissi to confront the coronavirus crisis, 22 March 2020.
[13] MENAFN, “Qatar announces QR75bn stimulus for private sector“, 16 March 2020.
[14] Vivid Economics, “The Greenness of Stimulus Index”, 6th Edition, 2021.
[15] ESCWA, “Strengthening the capacity of the water and sanitation sector in Arab countries to deal with the COVID-19 crisis”, (E/ESCWA/CL1.CCS/2021/TP.6).
[16] Khaleej Times, “Covid-19: Fees reduced, cancelled under Abu Dhabi stimulus package”, 17 March 2020.
[17] Weqaya, “COVID-19: Sharjah govt announces second stimulus package”, 6 November 2020.
[18] Oman, Ministry of Finance, “Economic Stimulus Plan”, 2021.
[19] Vivid Economics, “The Greenness of Stimulus Index”, 2021; OECD, “The OECD Green Recovery Database: Examining the environmental implications of COVID-19 recovery policies”, 2021.
[20] Yuyan Zhang, “Promoting Green Development”, G20 Insights, 1 September 2017.
[21] International Institute for Sustainable Development (IISD), Cutting Emissions and Budget Deficits for a Post-Pandemic World: Fossil fuel subsidy reform and carbon pricing, Global Subsidies Initiative (Nordic Council of Ministers/Publication Unit, Copenhagen, 2020).
[22] United Arab Emirates, Official Portal of the UAE Government, “Operation 300bn, the United Arab Emirates industrial strategy”, 12 October 2021.
[23] Green hydrogen is “hydrogen fuel that is created using renewable energy instead of fossil fuels. It has the potential to provide clean power for manufacturing, transportation, and more - and its only by product is water”. Renee Cho, “Why We Need Green Hydrogen”, Columbia Climate School, 7 January 2021.
[24] Vivid Economics, “The Greenness of Stimulus Index”, 2021.
[25] Saudi Green Initiative, “Reducing Emissions”, n.d.
[26] Jordan, Ministry of Planning and International Cooperation, The Government’s Indicative Executive Programme (2021-2024), Part 1 and Part 2, 2021.
[27] Jordan, Ministry of Environment, “Transport Sector: Green Growth National Action Plan 2021-2025”, 2020.
[28] Algeria, Services du Premier Ministre, "Economic Recovery Plan 2020-2024" (French original title: Plan de Relance Économique 2020- 2024", 2021.
[29] Egypt, Ministry of Planning and Economic Development, “Egypt’s 2021 Voluntary National Review”, 2021.
[30] Lebanon, Ministry of Agriculture, “National Agriculture Strategy 2020-2025”, 2020.
[31] Somalia, Ministry of Planning, Investment and Economic Development, “National Development Plan 2020 to 2024”, 2020.
[32] Jordan, Ministry of Planning and International Cooperation, The Government’s Indicative Executive Programme (2021-2024) Part 1 and Part 2, 2021.
[33] Morocco, Voluntary National Review of SDG implementation (French original title: Examen National Volontaire De La Mise En Œuvre Des Objectifs De Développement Durable), 2020.
[34] Palestine, Prime Minister’s Office, "National Development Plan 2021-2023", 2020.
[35] Tunisia, "National Voluntary Report On The Implementation of SDGs 2021" (French original title: Rapport National Volontaire Sur La Mise En Œuvre Des Objectifs De Développement Durable), 2021.
[36] Marina Wes, “Building Back Better”, 2021.
[37] Palestine, Prime Minister’s Office, "National Development Plan 2021-2023", 2020.
[38] Platform for Redesign 2020, “Mauritania”, 8 October 2020.
[39] United Nations Department of Economic and Social Affairs, “Syrian Arab Republic: Voluntary National Review 2020”, Sustainable Development Knowledge Platform, 2020.
[40] Morocco, Voluntary National Review of SDG implementation (French original title: Examen National Volontaire De La Mise En Œuvre Des Objectifs De Développement Durable), 2020.
[41] Saudi Green Initiative, “Reducing Emissions”, n.d.
[42] Ibid.
[43] IISD, “Two programs support green recovery in Egypt”, 13 November 2021; The Financial, “EBRD, EU and GCF boost green finance in Egypt”, 11 November 2020.
[44] IISD, “EU and EBRD: finance for green recovery in Egypt, Morocco and Eastern Partnership countries”, 3 July 2020.
[45] Enterprise Press, “Egypt is poised to ride 2021’s green bond wave, 16 March 2021.
[46] World Bank, “World Bank Supports Jordan’s Green, Resilient, and Inclusive Recovery”, 14 June 2021.
[47] UAE Ministry of Climate Change and Environment, “UAE Sustainable Finance Framework 2021 – 2031”, 2021. Available at: https://www.moccae.gov.ae/assets/download/24b84d14/UAE_Sustainable_framework_21.pdf.aspx.
[48] Center for Applied Research on Partnership with the Orient (CARPO), “Post COVID-19: A Potential for Green Recovery in the Arab Gulf States”, 2021.
[49] NS Energy, “Kuwait scraps 1.5GW Al-Dabdaba solar project due to coronavirus impact”, 14 July 2020.
[50] OECD, Towards green growth: Tracking progress, (Paris, OECD publishing, 2015).
[51] Ibid.
[52] OECD, “The OECD Green Recovery Database”, 2021.
[53] ILO, “Just transition towards environmentally sustainable economies and societies for all”, ILO ACTRAV Policy Brief, 2018.
[54] The Leadership Group for Industry Transition, “Reaching Net-Zero Industry Through Public-Private Partnerships”, 28 May 2021.
[55] ESCWA, “Policy Options for Promoting Green Technologies in the Arab Region”
[56] OECD, “Making the green recovery work for jobs, income and growth”, 6 October 2020.
[57] United Nations Environment Programme, Promoting Sustainable Finance and Green Finance in the Arab Region (Geneva, UNEP, 2021).
[58] ILO, World Employment and Social Outlook 2018: Greening with Jobs (International Labour Office – Geneva: ILO, 2018).
[59] European Parliament, “Global Mega-Trends. Scanning the Post-Coronavirus Horizon”, 2020.
[60] Owen Bennet, “Green sukuk market won’t ignite without Gulf governments backing, warns top Fitch Ratings analyst”, Arab News, 7 September 2021.
[61] Vivid Economics, “The Greenness of Stimulus Index”, 2021.
[62] ESCWA, “Technical note on co-benefits of adaptation and mitigation for climate actions: Nature-based solutions”, E/ESCWA/CLI1.CSS/2021/TP.1, 2021.
[63] Damian Carrington, “World leaders announce plan to make green tech cheaper than alternatives”, The Guardian, 2 November 2021.
[64] David McGinty, “How to Build a Circular Economy”, World Resources Institute, 6 August 2020.
[65] Steph Pietras, Alyson Marks and Grant Cameron, “Mobilizing ‘Smart City’ Growth for a Resilient Future”, Thematic Research Network on Data and Statistics (TReNDS), 14 June 2021.
[66] ESCWA, “Arab agriculture and water ministers agree to join hands against impacts of climate change, land degradation and water scarcity”, 4 April 2019.
[67] ESCWA, “Climate/SDGs debt swap mechanisms”, 2021.
[68] Yuyan Zhang, “Promoting Green Development”, 2017.