Financial crises cause one-step forward, two steps back when it comes to air quality

New research has shed light on the impact of financial crises on air pollution showing that, while emissions are reduced during a financial crisis, the positive impacts are unexpectedly short-lived as new patterns of pollution emerge.

A study led by Dr Andreas Antoniades and Dr Alexander Antonarakis at the University of Sussex shows that the break out of a financial crisis is associated with reductions in carbon dioxide (CO2) sulphur dioxide (SO2), and nitrogen dioxide (NOx), and emissions. When a crisis is also accompanied by a decrease in GDP (a recession), then the reduction in emissions is even stronger.

However, just one year on, everything changes.

The paper published in the journal ‘ Science of the Total Environment’ , analysed 419 financial crises in more than 150 countries between 1970 to 2014. It revealed that just one year after the break out of a financial crisis, emissions start to sharply increase again.

The effects are particularly worrying when it comes to PM2.5 or particulate matter , one of the most lethal pollutants. Results show that particulate matter actually increases by 1-2% 4-6 years after the beginning of the crisis.

The researchers argue that countries recovering from financial crises are missing the opportunity to rebuild a greener economy.

Dr Antoniades, Senior Lecturer in Global Political Economy, and part of the Sussex Sustainability Research Programme (SSRP), said: “Financial crises are associated with a reduced consumption of goods, reduced industrial production, reduced energy consumption, reduced use of private transport and overall, reduced economic activity.

“So in theory, we might think that a financial crisis could be good for the environment, meaning lower emissions and a more sustainable environment.

“Rather no. The rate of economic growth is a key driver of air pollution, but the mode of ‘degrowth’ matters a great deal for air quality and environmental sustainability. Our research reveals that a crisis-driven punctuated degrowth is part of the problem, not a solution. From focusing on the trade-offs between growth and the environment, we urgently need to focus on the environment as the most important factor for sustainable growth.”

According to latest World Health Organisation (WHO) data, 9 out of 10 people breathe polluted air, leading to 7 million deaths each year.

A great number of deaths from lung diseases (43%), lung cancer (29%), heart diseases (25%) and strokes (24%) can be attributed to air pollution.

Dr Antonarakis, Senior Lecturer in Global Change Ecology, said: “Understanding the relationship between financial crises and the environment can really help countries to better understand how to tackle the UN Sustainable Development Goals, and think about coping strategies which not only tackle economic downturn, but also take into consideration the environment and our health.”

“The work we’ve done shows that countries need a policy framework that goes beyond economic growth and short-term budgetary actions, to encompass long-term environmental goals.

“We need tighter environmental regulations and green investments, and there needs to be a paradigmatic shift in international policy making the environment a principle factor in sustainable growth.”

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By: Stephanie Allen
Last updated: Friday, 11 October 2019