Researchers at the CSIRO have published the results of a major study in the journal Nature which combines nine different economic and environmental models to examine twenty different possible ways in which Australia could develop by 2050.
Many of the 20 scenarios would produce substantial progress towards sustainable prosperity with Australia beginning to repair past damage, restoring significant areas of native habitat and achieving negative emissions of greenhouse gasses while enjoying strong economic growth.
Even if Australia rapidly cuts carbon emissions to achieve negative emissions as early as 2040, the models indicate that GDP would still grow strongly.
However, none of these scenarios guarantees sustainability or eliminates future threats. Instead, each involves a different set of risks and opportunities with longer-term risks and opportunities being influenced by global circumstances. The country cannot expect technological advances to reduce environmental pressures by themselves – appropriate pubic policy settings will be crucial.
An important finding is that weak global action to reduce greenhouse emissions may diminish Australia’s traditional comparative advantage, particularly in fossil fuel-based sectors, without creating new areas of advantage. However, stronger global action would be better for Australia as it would create new opportunities for creating value, providing win-win economic and environmental benefits.
The economic costs of reducing environmental pressures will be smaller, and the benefits larger, if there are global policies supporting the stable functioning by the promotion of clean energy. The more such global policies emerge, the more Australia’s opportunities will multiply.
Similarly, strong international action on climate change would benefit the Australian economy, even ignoring the accompanying benefits of reduced climate impacts. Although such action would weaken demand for its coal, the country would enjoy increased demand for Australian gas, uranium and agricultural produce.