New Zealand Abandons Clean, Green Policies to Boost Economy

New Zealand has decided to abandon its clean, green policies in favor of boosting the economy. This strategic shift prioritizes economic growth over environmental sustainability, raising concerns about the long-term impact on the country's natural resources and reputation as an eco-friendly destination. The decision has sparked significant debate among policymakers, environmentalists, and the public regarding the balance between economic development and maintaining environmental integrity.

New Zealand's green credentials are at risk as the government rolls back environmental reforms to boost a struggling economy and fulfill voter promises.

Since taking power last year, Prime Minister Christopher Luxon's centre-right coalition announced it will reverse a ban on oil and gas exploration, delay the pricing of agricultural emissions by five years, and encourage more mining.

This shift in government priorities aims to increase exports to support an economy that grew only 0.3% in the year to March 2024, the lowest growth since the 2020 pandemic, with a current account deficit of 6.8% of GDP. Exports comprise nearly a quarter of New Zealand's economy. "The economic situation for me is arguably the worst I've seen in my adult life," said Resources Minister Shane Jones.

"So when the opportunity arose to champion the re-emergence of the mineral sector, it was driven by a brutal understanding of our economic situation," he added. The agricultural sector, including fishing, contributes 5% to the economy and accounts for about 80% of total exports. Farmers, who helped Luxon's government come to power, said the environmental policies being reversed would have made dairy and meat too costly to produce.

While farmers and companies have welcomed the changes, environmentalists criticized the coalition for what they called shortsighted policies. "They are not considering the long-term economic impacts of environmental damage for short-term gains," said Nicola Toki, chief executive of environmental organization Forest and Bird.

Last week, Air New Zealand dropped its 2030 emissions target, citing delays in new aircraft and high prices of eco-friendly fuel. The opposition Green Party expressed concern that the government's "low ambition approach to climate change" would lead other companies to follow suit.

A report from the government Climate Commission released last week warned of significant risks to New Zealand meeting its 2030 and 2035 domestic emission targets and its promised reduction in methane from animals and waste. It noted that any shortfall in these targets would increase the need for more offshore mitigation, potentially costing up to NZ$23.5 billion ($14 billion).

The government has announced a climate change plan that includes planting more trees, increasing renewable energy supply, and investing in advanced technology to reduce emissions. Climate Minister Simon Watts said the government expects to meet the 2030 target but acknowledged more work is needed for the 2035 target. "We are committed to our climate targets but will use a least-cost approach without shutting down vital economic sectors," he said.

Environmentalists argue this is insufficient. Sara Walton, co-director of the University of Otago Climate Change Research Network, warned of significant reputational and financial damage if New Zealand fails to meet its targets. "Reducing emissions is crucial for maintaining international competitiveness," Walton said.

Following the rural vote that helped the coalition government gain power, the government promised to exclude agriculture from the emissions trading scheme. Agricultural emissions will still be taxed from 2030, but rules protecting "significant natural areas" to support biodiversity are being suspended.

The government is also targeting energy and mineral resources. It plans to allow oil and gas exploration again, reversing a 2018 ban by former Prime Minister Jacinda Ardern, to reduce coal imports, boost fuel exports, and keep energy prices low for the public and small businesses.

The government aims to double mineral exports to NZ$2 billion over 10 years and has announced a resource stocktake. It has proposed a fast-track consenting process that would allow projects like mines to bypass current resource consents if they secure ministerial approval.

Cindy Baxter, chair of environmental group Kiwis against Seabed Mining, expressed concern that this could enable a controversial seabed mining project on New Zealand's west coast. "It's a beautiful piece of ocean with reefs and sea life that could be destroyed by seabed mining," Baxter said.

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Source: Reuters‍