Jan. 10, 2008 - Entrepreneurs, NGOs, and governments around the world are field-testing an array of green innovations that offer new opportunities for long-term economic growth, according to Worldwatch Institute's State of the World 2008. The report cites breakthrough environmental initiatives from some of the most powerful players in todays economy, including Citigroup, Goldman Sachs, Kleiner Perkins Caufield & Byers, McKinsey & Company, and Wal-Mart.

The report rounds up the latest economic indicators of a greener global marketplace. Some striking figures:

• An estimated $52 billion was invested in renewable energy in 2006, up 33% from 2005. Preliminary estimates indicate that the figure reached $66 billion in 2007.
• Carbon trading reached an estimated $30 billion in 2006, nearly triple the amount traded in 2005.
• 575 environmental and energy hedge funds now in existence, most of them formed in the last few years.
• Clean tech has rapidly grown to be the third largest recipient of venture capital, trailing only the Internet and biotechnology.
• Fifty-four banks, representing 85% of global private project finance capacity, have endorsed the Equator Principles, a new international standard of sustainability investment.
  

"Once regarded as irrelevant to economic activity, environmental problems are drastically rewriting the rules for business, investors, and consumers, affecting over $100 billion in annual capital flows," says report co-director Gary Gardner.

On the downside, State of the World 2008 finds growing evidence that the global economy is now destroying its own ecological base. The report cites two major economic modeling studies that find that the damage from global climate change could equal as much as 8% of global economic output by the end of this century. And according to World Bank data, some 39 countries experienced a decline of 5% or more in wealth when accounting measures also included factors such as unsustainable forest harvesting, depletion of non-renewable resources, and damage from carbon emissions.

"Continued human progress now depends on an economic transformation that is more profound than any seen in the last century," says Worldwatch president Christopher Flavin. "We should be practicing a sustainable approach to economics that takes advantage of the ability of markets to allocate scarce resources while explicitly recognizing that our economy is dependent on the broader ecosystem that contains it."

We have the tools today to steer the global economy onto a sustainable path," adds Gardner. "The task now is to bring them together and scale them up so that they become the norm across todays economies."

Order a copy of the report here.