How to create twice as many jobs by integrating climate policies in COVID-19 economic recovery packages – An illustration from Cyprus

Everybody agrees that a strong policy response to COVID-19 is and will be needed. And everybody agrees that it would be even better if this response could also contribute to solve problems that predate this crisis, from slow growth to high dependence on fossil fuels. In particular, stimulus packages could play a fundamental role in making the recovery more resilient, sustainable, and set in place pathways to decarbonization.

In a previous blog post, we described a framework to screen for country-specific measures that contribute to the needed short-term economic stimulus, while also integrating climate policies and building resilience. We follow up here by presenting results from the implementation of this approach in the case of Cyprus, an island state and European Union member in the Eastern Mediterranean with a population of about one million. A detailed report of the methodology and results can be found here. So what are the main takeaways that can also be applied to other countries?

Understanding the Approach

We start from thirteen green recovery measures that are relevant for the country, most of which are drawn from existing national economic and climate plans. Other investments or reforms were added if they were important additions to drive the green transition in the medium and long term, assessed against numerous criteria related to environmental sustainability, socio-economic and job impact, and climate resilience, and based on the World Bank proposed sustainability checklist.

The aim of our science-policy framework is to inform and enable decisions by policymakers with transparent analyses and estimates that combine expert knowledge, quantitative open-source modelling, and qualitative inputs by diverse social actors. Quantitative evaluations were performed with an economic input-output model and an energy-system model. For the qualitative part, the assessment process followed state-of-the-art multi-criteria decision methods and engaged stakeholders from government, enterprises, and civil society.

Quantitative modelling provided important insights on the impact of recovery measures on economic growth, employment, energy use, and carbon emissions.  Qualitative and expert opinions complemented these numerical results with considerations that cannot easily be quantified and modelled. For instance, available tools and data did not allow us to look at the distribution of jobs between skilled and unskilled positions, and these important considerations had to be included based on expert opinions.

Read the full article on the World Bank blog.

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