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p. 33 of 57 BACK | NEXT I. The Changing Environment II. Driving Forces of Change III. Options and Opportunities IV. Toward Policy Integration Mounting Pressure for Policy Responses Policy Integration Entry Points for Policy Integration Managing Economic Fundamentals Intrasectoral Policy Integration Intersectoral Policy Integration International Trade and Investment Governance A Framework for Policy Integration Toward an Action Agenda V. Call to Action

Asian Environment Outlook 2001 : IV. Toward Policy Integration

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Policy Integration

It is important that policy integration be facilitative rather than proscriptive. For example, policies should not prescribe technologies to be used but ensure that information is available on a full range of technology choices, including both the economic and environmental efficiency of these technologies. Fundamentally, policy integration seeks to reduce the economic and social costs of organizational and technological changes driven by intensified pressure to improve environmental performance (see Box 4-1).

The adoption of effective environmental policy is a prerequisite for achieving substantial progress in reducing environmental degradation within the Asia and Pacific region. Environmental policy begins with ambitious but achievable goals clearly stated and consistently pursued. It is also essential to note that environmental policy cannot be successful if it does not involve a strong national environmental regulatory agency with the authority to implement environmental standards. In addition, effective environmental policy requires the use of appropriate policy tools, including ambient environmental standards, market-based instruments (MBI), and pollution charges as well as instruments of informal regulation, such as public disclosure of environmental performance information. Environmental regulatory institutions must have flexibility of response, coordination across levels, the capacity to learn and adapt to change, and broad stakeholder support. A first priority within many Asian and Pacific economies should be the strengthening of environmental protection institutions - both to enhance environmental protection and to improve the economic efficiency of environmental regulation.

Effectively pursued, policy integration lowers the marginal cost of driving down the intensity of energy, materials, pollution generation, and resource use associated with economic activity. In the absence of identifiable and realizable opportunities, increased pressure for change will raise costs rather than stimulate innovation.

Not all required changes will be favorable for the individual economic actors even though the net result supports enhanced economic and environmental improvement within the economy as a whole. For example, closure of outdated and inefficient factories will create economic dislocation for the workers involved. Decisions to limit use of over-taxed fisheries and forest areas will impact those whose livelihoods depend on these resources. It is therefore critical that mechanisms are in place to deal with such adjustments equitably and with the adequate participation of all actors in the decision making process. To the extent that individual economic actors assume the cost burden for greater public good, it is appropriate that society invest to offset these costs and return the benefits. This will no doubt be one of the most challenging aspects of the economy-environment integration.

The emphasis is on how a transition in the relationship of economic development and the environment can be managed to reduce overall economic and social costs. The focus is not so much on environmental policy as on methodology for integrating environmental and economic policy, thereby creating a framework of policy integration that facilitates the pursuit of environmental goals in ways that are consistent with other societal goals, especially reducing poverty and supporting economic growth (Angel and Rock 2001). The entry points for policy integration to improve environmental performance are discussed more fully in the following sections.

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