Carbon dioxide (CO2) from the combustion of fossil fuels and biomass accounts for 90% of total greenhouse gas (GHG) emissions. It is thus a key factor in countries’ ability to deal with climate change. The stabilisation of GHG concentrations in the atmosphere depends on implementation of coherent national and international policies that aim at structural and technological changes. It depends on countries’ ability to further decouple CO2 and other GHG emissions growth from economic growth, and reduce the overall level of emissions.

Energy is an essential input in all economic activities. The structure of a country’s energy supply and the efficiency of its energy use are key determinants of environmental performance and economic development. These, in turn, help determine green growth.

Material resources form the physical foundation of the economy. They differ in their physical and chemical characteristics, their abundance and their value to countries. The use of raw materials from natural resources and the related production and consumption processes have environmental, economic and social consequences beyond national borders. Improving resource productivity and ensuring a sustainable management of material resources is critical from both supply security and environmental perspectives.

The sustainability of agro-food systems is at the centre of green growth considerations. There are three main concerns related to sustainability: food security, run-off of nutrients such as nitrogen (N) and phosphorus (P) from commercial fertiliser use and intensive livestock farming, and pesticide residues that may leach into surface water and groundwater and enter the food chain. Farming also contributes to climate change and can lead to deterioration in soil, water and air quality and to loss of natural habitats and biodiversity. These environmental changes can, in turn, have implications for agricultural production and limit the sustainability of agriculture. But farming can also provide sinks for greenhouse gases (GHGs), help conserve biodiversity and landscapes, and help prevent floods and landslides.

Rising productivity is a key source of long-run economic growth that can increase material living standards. To capture the role of environmental services, the OECD productivity framework was extended to calculate the environmentally adjusted multifactor productivity (EAMFP) growth. The EAMFP thus measures a country’s ability to generate income from a given set of inputs (including also domestic natural resources). At the same time, it accounts for the production of undesirable environmental by-products (pollution).