Greening of Asia should be halted

The following comment by me appeared in today’s issue of Fund Strategy:

The trend towards the “greening of Asia” represents one of the most retrograde developments of our time. Asia has benefited enormously from its rapid economic growth and could gain a lot more in the future. Anything that threatens such growth should be resisted staunchly.

It is only because of the deeply pessimistic times we live in that the greening of Asia is taken seriously. The benefits of growth tend to be grossly under-appreciated while the prospect of environmental damage prompts panic.

From the relative comfort of a developed nation it is easy to forget how beneficial growth has proved. Among other things it has led to greatly improved longevity, lower infant mortality, increased education, vastly better infrastructure, more consumer goods and more leisure time.

Yet much of Asia remains relatively poor. Even China, although it has grown rapidly over the past 30 years, still has much lower income per head than developed economies.

Under such circumstances, growth should remain a top priority. If the region chooses to use “dirty energy”, rather than go to the extra expense of “going green”, it should be free to do so. Fossil fuels are legitimate ways of meeting Asia’s energy needs.

As it happens, growth generally provides the resources to clean up the environment. Typically, countries go through an “environmental transition” as they industrialise.

The early days of industrialisation are often heavily polluting. But as the economy grows it becomes able to generate the resources to produce goods and services more cleanly.

The developed world has already experienced this transition. America and Britain produce more than ever in absolute terms, yet the environment is generally much cleaner than it was in the earlier industrial period.

If the developed world is that worried about dirty energy it can always provide the latest technology to developing countries. No doubt if it is freely or even just cheaply available to them they are likely to make good use of it.

But it is important not to lose sight of the over-riding importance of growth. It would be wrong, from both an economic and moral perspective, to impose the use of particular technologies deemed “green” in the West.