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By Soogil Young, Ph.D.
Chairman, Presidential Committee on Green Growth, Republic of Korea
Korea’s Green Growth Policies
Korea’s green growth was formally launched on August 15, 2008, when President Lee Myungbak declared in his speech marking the 60th anniversary of Korea’s founding of its modern government that ‘low carbon green growth’ should be the core of Korea’s new development
vision for the next 60 years. In this speech, President Lee defined ‘green growth’ as “achieving sustainable growth by reducing greenhouse gas emission and environmental pollution.” How would this be possible? He answered this question by saying,
“Green growth is a new development paradigm that creates new growth engines and jobs with green technologies and clean energies.”
During the subsequent one year and a half, the Korean government set up the requisite institutional framework for green growth in order to implement President Lee’s declaration of the green growth strategy. It consists of four key pillars:
- The Presidential Committee on Green Growth;
- The National Green Growth Development Strategy(2009~2050), and a 5-Year Plan for
Green Growth(2009~2013);
- Medium-Term National Greenhouse Gas Emission Reduction Target; and,
- The Framework Act for Low Carbon Green Growth.
These four pillars are explained briefly below.
Presidential Committee on Green Growth
This is an advisory institution for the president, consisting of 14 Ministers, including the Prime Minister, and 36 appointed members from the private sector with professional background of
relevance to green growth, co-chaired by the Prime Minister and an appointed civilian Chairman. It serves as the highest venue for inter-Ministerial coordination of policies as well as for publicprivate sector consultation on those policies.
The Green Growth Strategy and the 5-Year Plan
Prepared by the Presidential Committee, the Strategy proposes the vision of Korea as one of seven ranking green economies by 2020 and one of five ranking green economies by 2050. This vision gives rise to three strategies, ten policy directions, and fifty policy tasks.
< Figure 1. Korea’s Green Growth Strategy: Schematic Presentation >
The three strategies are: first, to reduce greenhouse gas emissions while adapt to climate change; second, to create new growth engines from green technologies; and third, to improve the quality of life by greening lifestyles while becoming a role model green growth country.
The Strategy so defined should show that Korea’s green growth is indeed a new development model, far broader in scope than energy or environmental policies, though it does not go far
enough to also address social policy goals.
The 5-Year Plan was a revival of the developmental era practice which was discontinued in the early 1990s. The Plan assigns 2% of the GDP to green investment by the government throughout the plan period, which was double the level recommended to governments by UNEP.
Various green growth policies have been introduced for implementation under the umbrella of this Plan and through deliberation by the Presidential Committee on Green Growth.
As President Lee indicated in his speech quoted here earlier, the key to sustained green growth will be a pervasive and sustained process of innovation, in both the technological and the institutional sense. The role of this innovation would be to delink economic growth and environmental degradation, most crucially by stimulating investment in de-carbonization of energies as well as saving and recycling of natural resources.
National Greenhouse Gas Emission Reduction Target
Under the Korean strategy, given the country’s highly energy-intensive industrial structure which makes its economy highly vulnerable to international energy crises and carbon regulations, the main focus of green innovation is on cutting down the CO2 emission. This makes the
determination to reduce greenhouse gas emissions the ultimate driver of the green innovation that Korea needs.
Korea made such determination firm by adopting its medium-term emission reduction target of -30% relative to BAU by 2020 in November 2009 after several months of national debate.
President Lee made this an international political commitment by declaring at COP 15 in
Copenhagen, in December, 2009, that Korea would pursue this target unilaterally and voluntarily in what he called the ‘me-first’ spirit.
The Korean business community expressed a strong objection to this target, considering it overly ambitious for Korea and fearing its serious impact on the competitiveness of the industry.
However, an ambitious target was considered by the Presidential Committee necessary in to stimulate a broad-ranging clean technology innovation for greater energy efficiency economywide as well as for deployment of renewable energies.
And the unilateral adoption of an emission reduction target has allowed Korea to make an early mover for green growth, without having to wait for others to do the same.
The government has been playing a critical role in triggering, facilitating and sustaining the green innovation process with regulatory and supportive measures, especially in regard to R&D and the initial market creation.
The emission reduction target has given rise to many measures for its implementation, including the so-called sectoral emission target management system and the planned introduction of the emission rights trading system in January 2015.
The Framework Act for Low Carbon Green Growth
This law was enacted in April 2010, authorizing the government to intervene in the market in order to address market failures in promoting green growth. Among other things, it makes provisions for the emission rights trading system.
Green Business Boom in Korea
Since the formal launching of green growth in Korea in 2008, there has emerged sort of a green business boom in Korea.
All major business groups have made green business a high priority for investment in their short and long term plans. During 2008~2010, the combined total of such investment by 30 largest business groups recorded the annual growth rate of 75% and amounted to 15.1 trillion won
(about 13 billion US dollars). Investment is focused on new and renewable energy equipment, high-efficiency electric equipment, green cars, climate change adaptation, etc.
Small and medium size enterprises, too, have been joining in the green rush, some of them already emerging as hidden champions in the global market for parts and components for solar and wind power systems, for example.
The government itself has been a leading investor in green growth, especially, in green infrastructure. Two leading examples are a major construction project to restore four major rivers and a project to create a nation-wide network of high-speed rails in order to induce a modal shift of people from the road to the railroad.
By any measure, Korean green growth policies have been a success thus far. Businesses are actively exploring opportunities in green growth. Local governments all have drawn up and are pursuing visions of green communities. There is a popular support for green life and green growth among the public. Korea is now awash with enthusiasm for green growth and on track toward a green Korea.
Secrets of Green Growth Success Thus Far
Various indications are that Korea’s green growth may be considered a success at least up to this point. This success may be attributed to at least three factors: the visionary leadership of the political leader firmly committed to a new green growth strategy, the me-first approach to carbon emission reduction and environmental protection, and an effective coordination among all relevant ministries.
The challenge facing Korea now is to sustain its progress toward the realization of its emission reduction target and environmental protection goals. This is no small challenge, considering the industry’s constant concern with its international competitiveness and the political uncertainties which will heighten as the presidential election of December 2012 approaches.
Towards a Global Architecture for Green Growth
One of the objectives of Korean green growth policies is to promote the globalization of green growth strategy for all countries, and especially, the developing ones. This will help create a global architecture for green growth, thereby enhancing the effectiveness of national green growth policies, offering a foundation for global sustainable development, and facilitating international cooperation for mitigation of climate change.
The Korean government has taken a number of international initiatives for this purpose. Five such initiatives may be mentioned.
In 2008, Korea launched the annual work programs to help the developing countries in Asia undertake green growth projects under the East Asian Climate Partnership Initiative.
In 2010, Korea formally acceded to the OECD Development Assistance Committee and declared that the country would continue to increase its ODA commitment, with focus on green ODA, including the EACP Initiative, from 0.09% of GNI in 2008 to the OECD average ratio of ODA
to GNI by 2020.
In June 2010, Korea launched the Global Green Growth Institute as an international think tank which would advise the developing countries on their green growth policies as well as help them specific green growth projects. GGGI is run by an international board of directors and draws
financial resources from Korea and other advanced ‘partner’ countries. As of October 2011,? eleven countries including six developing countries have joined GGGI as partner countries. It also partners with many international organizations and institutions.
In May 2009, Korea proposed to the OECD to launch a study project on the green growth strategy. This proposal was accepted and a two-year project was undertaken. The final report was released in May 2010. The OECD declared its intention to push the green growth strategy to
its member countries as well as non-member countries. The OECD has begun collaboration with other international organizations and institutions such as UNEP and the World Bank on green growth. Korea will continue to work closely with all those institutions to promote global green growth.
The Korean government is preparing to launch a Green Technology Center. This Center will promote international green technology cooperation in general, and for the developing countries,
in particular.
All these efforts of the Korean government will contribute to the creation of a global architecture for green growth for the benefit of all countries and help facilitate sustainable development and climate change cooperation.
