JAPAN should do more to fight climate change and protect biodiversity,
according to a new OECD review of its environment. Tackling these two problems
would improve the environment and help boost long-term growth.
OECD’s
Environmental Performance Review of Japan says the stimulus package includes
support for agriculture and for the car industry which could have negative
effects on the environment and distort competition. In addition, though the use
of water and waste charges has been extended and new green taxes have been
introduced - , there is a continuing overreliance on subsidies and negotiated
agreements with industry.
Reforming the environmental policy mix is
necessary, said Mr. Gurría: “In its 2011 tax reform Japan should make more use
of market- based instruments, such as environmental taxes, that apply to the
economy as a whole: we believe they would provide a more cost-effective way of
providing incentives for achieving environmental policy objectives, reduce
pressure on the public budget, and further promote eco innovation.”
Only
3% of Japan’s energy is from renewable sources and electricity consumption in
homes and businesses has been growing steadily. The OECD review says more must
be done to reduce reliance on fossil fuels and to achieve Japan’s climate
targets more efficiently. The review recommends putting a consistent price on
carbon through a mandatory cap-and-trade scheme in combination with a carbon
tax.
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