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Intensification of international trade leads to environmental degradation and resource depletion in developing countries.

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Provide three arguments in favour AND three against this proposition.

Intensification of international trade leads to environmental degradation and resource depletion in developing countries because of: (i) developing countries tend to specialize in ‘dirty industries’ that Multi-national corporations (MNCs) transfer their pollution intensive production facilities to poorer countries, because of the uncontrolled environmental regulations or even non-existing environmental regulations in developing countries; (ii) comparative advantage of developing countries produces and export environmentally intensive goods to a greater degree than is efficient, and at prices that are below social cost (iii) deforestation for export crops, rain forest that rich in biodiversity in developing countries is destroyed to give way for the production of certain cash crops such as palm, timber, coffee.

However, there are arguments that international trade can bring beneficial effect for environment as: (i) Techniques or technologies shift to cleaner and environmental friendly, this happen when developing countries imports environmentally friendly products such as fuel-efficient autos.  Trade also brings technological innovation, or multi national corporation who bring global standards to where the domestic site is less friendly. (ii) Multilateral agreements for trade sanction, as in Montreal Protocol on ozone depletion, Kyoto Protocol.

Written by ibu didin

February 13th, 2010 at 12:49 pm

The three P mantra (People, Planet, Profit)

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The three P mantra (People, Planet, Profit) conceptualizes sustainability in the social, economic and environmental domains. Argue against such a broad conceptualization of sustainability that goes beyond the environmental sphere.

The three P mantra “People, Planet, and Profit” describe the triple bottom lines and the goal of sustainability. Sustainability is a topic that has become more popular and does not seem to be a single definition for the term. Sustainability is associated exclusively with environmental concerns. Triple bottom line reports are a mechanism for companies to report initiatives and outcomes in relation to economic, environmental, and societal impacts of business operations. This broad conceptualization of sustainability that goes beyond the environmental sphere is difficult to measure the planet and people accounts in the same terms as profits, that is in terms of cash.

In relation to people or societal impacts, triple bottom line reports should consider measurements such as labour policies, diversity, participation in fair trade practices and human rights related practices in both the reporting company and its supply chain. Planet measurements relate to environmental impact of business and can include measurements such as greenhouse gas emissions, participation in voluntary carbon offsetting, water usage and initiatives to decrease water consumption and projects which support natural biodiversity. “Profit” is the economic value created by the organization after deducting the cost of all inputs, including the cost of the capital tied up. It therefore differs from traditional accounting definitions of profit. It makes it difficult for businesses to recognize the benefits of using three P mantra for the company.

5 For further reading http://social-corporate-responsibility.suite101.com/article.cfm/triple_bottom_line_reporting

Written by ibu didin

February 12th, 2010 at 3:29 pm

Posted in Environment

What is meant by formal and informal regulation of environmental policy

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Under what circumstances can they be complementary to each other?

Formal regulation is environmental policy regulated by government institution which has formal (law & institutional) consequences. The first formal regulation is policy that seek to harness the positive links between development and environment including: (i) policy of building on the positive links which means many policies that good for efficiency are also good for the environment. For example policy to promote less consumption of raw material (papers) in state enterprise, it will reduce company’s spending for stationary and the same time saves consumption of woods for paper; (ii) policy of removing distortion, distorted incentives of government subsidy on energy. This will reduce government spending, and also promote efficiency in the use of energy.

The second formal regulation is targeted policies to change behavior including (i) policy based on incentives, which tax or charge polluters according to the amount of damage they do. This policy encourages those polluters with the lowest cost of control to take the most remedial action. Examples of this policy are fuel and vehicle taxes in most OECD countries, surcharges and stumpage fees to pay for replanting the forest in Indonesia; (ii) policy based on quantitative restrictions, such as specific regulations on what abatement technologies must be used in specific industries.

Informal regulation is ways to tackle environmental problem by non governmental policy. This informal regulations include (i) community pressure, improvement in the quality of life leads to stronger pressure on polluting facilities, public needs cleans sanitation, unpolluted air, access to clean water. This community movement to defend their rights and become powerful people power to fight environmental problem; (ii) Reputation, the company need to market their product in positive image, along with awareness amongst people of environmental problem, the more friendly product and company, the more likely consumers prefer to buy their products; (iii) involving local participation, neither government nor NGO are equipped to make judgments about how local people value their environment. Local participation also yields high economic and environmental returns in implementing program of forestation, park protection, water management, and sanitation. For example of local participation is a large irrigation project in Bali, Indonesia failed to recognize the advantages of traditional approaches, a follow up project that built on indigenous strengths succeeded.

That formal and informal regulation can be complementary under circumstances when government has conflicting social economic objectives, which allow them to use resource inefficient, or in case of weak government institution to face corporations, or inadequate data and knowledge for formal institution in finding solution with local people.

Written by ibu didin

February 12th, 2010 at 3:21 pm