This country review process integrates the discussion on best approaches to environmentally-sustainable growth with economic policies. These and related questions are explored in this issue of the STI Review, which draws on research being conducted as part of the OECD Three-Year Project on Sustainable Development. On the surface there is agreement, sustainable development refers to a broad set of issues, going beyond the relationship between the economy and the environment to encompass human and social concerns. Scratch the surface and you open a Pandora's box of differing notions of sustainability and means of achieving it. Energy price subsidies that encourage energy consumption by keeping prices below cost impose heavy burdens on economic efficiency, environmental quality and government budgets.
Climate change is an increasing concern across the world.
In 1997, a number of countries, including most OECD countries, agreed the Kyoto Protocol, which sets targets for future emissions of greenhouse gases that drive climate change. Globally, the environmental goods and services industry is growing rapidly in response to environmental pressures and the shift towards business and government strategies that are more sustainable over the long term. However, the industry which supplies the goods and services that enable businesses and nations to meet environmental challenges is poorly identified, measured and understood. Environmental taxes are receiving growing interest world-wide. From an environmental perspective, a key driver has been the search for more efficient and cost-effective approaches for implementing domestic environmental policies.