1. South West England
the place for
Environmental Integration
23rd February 2006
Nigel F Jump
Chief Economist
South West of England Regional Development Agency

2. South West England GDP & GVA incomplete measures of output
let alone total well-being.
Nevertheless…
GVA per head EU rank
€’000 EU=100
Glos, Wilts, & N Som
Dorset & rest of Somerset
Devon
Cornwall & Isles of Scilly
South West England

3. South West England Sub-regional shares of SW GVA, 2003 (%)
Gloucestershire, Wiltshire & North Somerset
53.9%
Dorset & Somerset
21.1%
Devon
17.9%
Cornwall & Isles of Scilly
7.1

4. Markets & the Environment
Prices allocate resources efficiently But market failures exist power information property rights rigidities state intervention
Externality social costs &benefits wrongly or not priced opportunity costs
Markets are imperfect but least worst Need to improve measurement - “Gross Sustainable Welfare”

5. Markets & the Environment
Scarcity - change - pace? short termism & absolute loss time & space trade-offs
Institutional Failures regulation - bureaucracy – taxation
Labour & Resource productivity
- relative v absolute problem - driven by technology/demographics
- sustainable consumption & production
Strong economic case - Env. service flow = $33 trillion p.a. - “Wild” net losses = $250bn p.a.

6. Monetary Valuation Total Economic Value Use Value Non-use Value Market
Non-market
Intrinsic
Bequest

7. Policy Issues Polluter pays principle
Taxes/subsidies - encourage ‘goods’ / discourage ‘bads’
Permits - regulation - campaigns - standards
Iterative processes - SD indicators - options markets - discount rates
Appropriate level of intervention?
Revenue recycling & hypothecation?

8. UK Sustainable Development
UK’s 5 Principles of Sustainable Development
Sustainable Economy
Good Governance
Sound Science
Living Within Environmental Limits
Strong, Healthy & Just Society

9. SW Environment Driver
3 linked RES drivers skills, innovation & environment key to productivity - SD - prosperity chain
Asset & flow value of environment to SW economy recognised by RES
businesses, 30k+ employees
- £1.5bn+ GVA, over 100k jobs
Env Tech - £1.4bn GVA,
22k jobs
Real costs of access, depletion & repair unknown - but 3 planets footprint

10. SW Environment Driver
Need to value: lifestyle choice environmental impact
Quality (building), waste handling & energy use.
Better option & risk assessment
Procurement requirements
Lobbying government & partners

12. SW Environment Driver Comparative Advantage
as scarcity raises potential returns
Sectors environmental technologies
construction, tourism, ICT, creative
Branding/Perception migration, entrepreneurship, leisure, investment – FDI, skills
Consumption services,
peripherality – overcome time-distance
Energy – renewables, low carbon, security
Materials – efficiency, waste, recycling

13. SUMMARY Better Measures of Prosperity Failure & Valuation
Resource Productivity
South West Environment Driver
- opportunity, options & Risk
South West England
The Place to do Environmental Business!