As the Senior Economic Advisor and Chief Environmental Economist for the UN Environment Programme (UNEP), Dr. Pushpam Kumar was instrumental in designing, implementing, and leading the operationalization of the concept of natural capital, which Dr. Kumar has defined as “assets that occur in nature and can be used for economic production or consumption.” These efforts culminated in a resolution on natural capital passed during UNEP’s Environment Assembly in 2016. Currently, Dr. Kumar focuses on bringing nature closer to financial and economic planning and models. He leads programs focused on inclusive wealth, planetary crises, and the financing of the UN Sustainable Development Goals.
Can you provide an overview of the current international response to the issue of illicit waste trade, particularly in impoverished countries?
From UNEP’s perspective, the environmental ministries are members of UNEP, [encompassing] more than 190 countries. They are concerned about the issues of waste and chemicals, including plastics. There are various reasons to be concerned about waste, chemicals, and plastics. But one of the most fundamental reasons is how they impact [the] mortality and morbidity of humans. Estimates [from] scientific studies [leave] no uncertainty that chemicals, especially wastes, including plastics, have an adverse impact on human health, compromising longevity [and] resilience.
A rough estimate [is that] two million people die every year from [pollution] and waste globally. This is more pronounced in the context of poorer parts of the world or materially challenged regions [like] Sub-Saharan Africa, [where] waste is a serious problem in landfilling activities. In Africa, where waste [is] used for filling the land, this has in turn not only impacted human life but also biodiversity. The variety and variability of life forms [are] a serious concern because our life revolves around resilient biodiversity. So, [waste] is not only a threat to human lives but also biodiversity and nature.
And money multiplies the risk factor and the threat to human lives. One [impact] is the direct impact of the waste on human life through [increased] mortality and morbidity. It [also hampers] biodiversity and the ecosystem functioning, adversely impacting human life. You have two pathways to impact human lives: one direct, another indirect. It’s serious.
What are the key economic incentives driving illegal waste dumping in countries in the Global South?
There [are] two types of issues. One is, broadly speaking, directly dumping the waste into land, water, coast, and in the air. [A] second is the way we are extracting, mining, and fragmenting habitats, [which] destroy[s] forests, pollute[s] water, [and harms] biodiversity or species. Both extraction [and] dumping, [what] we call “throughput,” [refer to] the magnitude of extracting and [the] amount of waste dumping. [These issues] are serious because, in order to maximize short-run revenue, industries [and] governments [overlook] the immediate impact of what they’re doing. But now, the cumulative effects and impacts are there for anyone to see, and people have become more alert.
Now, how to address or use economic incentives to correct or rectify this problem? Whenever we talk about extractive industries, [like] mining, metals, minerals, and others, and the dumping of the waste and chemicals, we have to [use] our cost-benefit framework [to] account for all the malign and benign impacts. So [we have to] evaluate, quantify, and monetize, [which] does not happen easily for several reasons. Sometimes it is unintentional, but sometimes it is intentional, because all [these] impacts are treated externally in conventional economics. The impact [is shifted] either onto other stakeholders or to future generations. [However,] the signs are saying [that] this [approach] is unsustainable, and the planet is indeed under threat.
You know the famous quotation or famous number that by 2030, the magnitude of fish [in the ocean] will be less than the magnitude of plastic. That is not good, not only [for] the survival of humans. So, number one, there should be a comprehensive evaluation matrix where all the impacts of [actions]—whether on land, water, air, or human health—should be quantified and internalized in the cost. This representation of both malign and benign impacts is somehow not happening, and certainly not to the extent we would like to see in poorer parts of the world.
Second, once we do that, we have to change the behavior of firms, households, and governments. Economic or fiscal incentives or disincentives, like some form of direct or indirect taxation [or] refund schemes for waste, can be used. There are enough examples that [show] economic incentives or disincentives really work. I don’t think there should be a problem with applying [these] economic instruments, even in developing countries, but of course, there are associated challenges like [the] need [for] a good governance structure to implement [them]. But I think once we use them, governance would evolve [accordingly].
So, I think there are other methods, too, [that] can really change the options available to individuals, households, communities, nations, and the entire globe to move in the right, sustainable direction by disincentivizing the dumping of waste. Economic instruments can be used, but the first and foremost thing is to estimate, quantify, and monetize all the malign and benign impacts of our actions [that] create waste and chemicals.
Could you elaborate more on how environmental protection agencies and international organizations like the UN Environment Programme (UNEP) prioritize and allocate resources to combat illicit waste dumping in these regions?
In September 2023, the global chemical framework came into existence and was coordinated by [the] UNEP to [develop] a structured framework to disincentivize waste and chemicals. Just last week, in early March, there [was an initiative] called FARM (Financing Agrochemical Reduction and Management Programme). Led by UNEP with some financial support from the Global Environment Facility, this [program focuses on] agriculture. This program seeks to reorient policy and financial resources [to discourage] farmers [from] the use of hazardous chemicals, which [have a direct and significant] impact [on] human health. Basically, the idea is to reduce the [use of] hazardous pesticides and chemical fertilizers.
UNEP is actively [leveraging] its convening power to bring member states [to] adopt and apply this framework. But, chemicals [are] not only for agriculture. Besides waste, most chemicals, [especially] hazardous [ones], are [generated] by industries. Industries are [usually] very receptive to cooperation, but the idea is to bring [together] all stakeholders and create consensus [on] the framework for impact evaluations. Secondly, [stakeholders should] also adopt new incentive[s] and disincentive[s] to discourage the creation of waste and chemicals. UNEP is very active in that space.
How have the economic interests of conglomerates and nations involved in toxic waste trade intersected with efforts to mitigate its impact on citizens?
There are some conflicts and trade-offs. [However,] if the goal is sustainability—[for] the health of people, [the] planet, [and] our children [and] grandchildren—then even if some industries have to compromise [on] profitability, the same stakeholders or CEOs [are] also fathers, mothers, sisters, brothers, husbands, or wives. We’re all humans; we can’t just be revenue maximizers [all] the time.
I always tell many countries when they talk about [achieving] 10 percent GDP growth: that’s a good idea. But if [the] sky is hazy, water is polluted, and there’s a lack of green space [for] recreation, what kind of growth and GDP are [we] striving for? If there’s no green forest, clear sky, [or] clean water, there’s [a] serious [problem]. Remember, the earth is finite. I don’t undermine the role of innovation and new technology, but remember, [the] diffusion and deployment of technology is a challenge.
Ultimately, natural capital or nature cannot be substituted by produced capital. [We] can’t substitute atmospheric visibility, clean air and water, and biodiversity by [building] more roads, buildings, and warehouses. Having more hospitals can increase [human] longevity, but not infinitely. So, what [may] appear as a tradeoff in the short run needs to [be addressed]. We need to raise awareness that we have to take care of our planet; otherwise, [we will] see climate change, heat waves, droughts, flooding, and pandemics [like] COVID-19, [with which] we have incurred [a] loss of US$15 trillion.
[There] are serious civilizational challenges [that] CEOs and stakeholders need to understand. I’m very excited that they’re receptive to what we are discussing here right now. If sustainability and [the] well-being of people is the objective, I [believe] people will understand, even if they happen to be the shareholders of a corporation.
What role do international treaties and agreements play in regulating the transboundary movement of hazardous waste and ensuring accountability among the nations or corporations involved?
[In] many ways, chemicals and pollutants have [a] transboundary character, [meaning] they [originate] in one part of the world but impact neighboring or adjoining areas through water [and] air. Not only that but also [the] export of items from developing countries like [those in] Sub-Saharan Africa, [such as] tea and coffee to [the United States] or Japan or Australia, [can impact] the way cultivation is done and soil is treated.
Trade, waste, and chemicals have a transboundary nature. There will soon be a global public goods institution; we [already] have [the] World Trade Organization (WTO), the UN body [that addresses] such issues. [However, the] export of chemicals or wastes [can have] a malign impact [that] is hardly internalized into terms of trade or pricing. There are several international conventions and treaties, [like] the Minamata [and] Rotterdam Conventions, [and conventions regarding] chlorofluorocarbons (CFCs) [and] ozone. But remember [that while] conventions are needed [and] countries are following the legal framework, [not] every hazardous waste [situation requires] a convention.
For instance, if there’s a fire in our house or area, do you think we need a convention to extinguish the fire? You don’t need a convention; you need to act. Similarly, for waste and chemicals, if [they] are killing people—[and] there are studies [proving that] chemicals and waste are compromising the IQ of children—[while] conventions are good, do you need a convention to act on this? I mean, they’re our children. [We] have to act upon this. Conventions are there, [and] they’re working fine, but instead of creating more conventions, we need to act at [both] national [and] global levels.
Are there any emerging economic trends or social developments, like the initiatives of Gen Z, that could impact the dynamics of illicit waste trade and its effect on global health?
Earlier, I [mentioned] the issues of climate finance, loss and damage assessment, [and] the biodiversity fund, [all crucial elements outlined in] the Kunming-Montreal Global Biodiversity Framework. [These initiatives] can be further strengthened [by integrating] economic frameworks, whether [through] national accounting, cost-benefit analyses of projects and policies, or fiscal designs that recognize [the] impact [of waste on] human health, human capital, and the economy as a whole.
At [the] project and policy level, we need to assess, quantify, [and] possibly monetize all adverse impacts, from production to waste generation. [While] economic tools are there, we need to demonstrate [their] potential to yield good results in this context.
There’s a lot of talk about moving beyond GDP, which has problems because it does not [account for] impacts of waste generation. It does account for the creation of waste, but how does it account for how that waste is impacting human health and society? So, then the solution is [to] move beyond GDP [by] trying to focus on the wealth of the people, and that includes [what] we call “inclusive wealth.” It includes [physical] capital, [like] buildings [and] equipment, but also human capital, [like] education, health, and natural capital.
That will help us in tracking the sustainability and well-being of nations. I think there is a need to change at [both] micro [and] macro levels. To break [existing] paradigms, the Secretary-General of the UN talks about [a] new financial architecture [that] can embrace this new way of thinking and bringing [inclusive] wealth into [the] discussion instead of only GDP.
Dake spoke with Dr. Kumar on March 19, 2024. This interview has been lightly edited for length and clarity.
Emefa, a staff writer for HIR, is studying Economics and Global Health. She is interested in the intersection of international development and global health in Sub-Saharan Africa and Latin America.
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