New Zealand’s green credentials are at risk as the government rolls back environmental reforms to boost the economy.
Since taking power, Prime Minister Luxon’s coalition will reverse the oil and gas ban, delay agricultural emissions pricing, and boost mining.
This government shift aims to boost exports, addressing a 0.3% growth for the year to March 2024 and a 6.8% GDP deficit.
Exports account for almost a quarter of New Zealand’s economy.
“The economic situation for me, is arguably the worst of the set of circumstances that I can remember in my adult life,” Resources Minister Shane Jones said.
“So when the opportunity arose to champion the re-emergence of the mineral sector it was driven by quite a brutal understanding of what our economic situation is,” he added.
The agricultural sector, including fishing, contributes 5% to the economy and 80% of exports. However, farmers argue that reversing environmental policies would make dairy and meat production costly.
While farmers and companies have praised the changes, environmentalists criticize the coalition for its perceived shortsighted policies.
“They are not looking at both sides of the ledger here, and the economic impacts of wrecking the joint for a few quick bucks for the government of this day, and therefore putting at risk the prosperity of future generations of New Zealanders,” said Nicola Toki, chief executive of environmental organization Forest and Bird.
Last week, Air New Zealand dropped its 2030 emissions target due to aircraft delays and costly green fuel; the Green Party is concerned.
Last week, the government Climate Commission report highlighted major risks for New Zealand’s 2030 and 2035 emission and methane reduction targets.
Any shortfall in targets will require increased offshore mitigation, with costs potentially reaching NZ$23.5 billion ($14 billion), as forecasted.
Balancing Emission Targets with Economic Growth
The government is working on a climate change plan, focusing on tree planting, boosting renewable energy, and investing in emissions-reducing technology.
Climate Minister Simon Watts said the government expects to meet the 2030 target; however, more work is needed for 2035.
“The Government is committed to meeting our climate change targets, but the way in which we do this will be different to former New Zealand Governments,” he said. “This Government is using a least-cost approach to meet our climate targets. We will not shut down sectors that are boosting our economy and exports.”
Environmentalists, however, say this is not enough.
Sara Walton, co-director of the University of Otago Climate Change Research Network, warned of New Zealand’s reputational and financial risks for missing targets.
“It’s more important than ever for companies to be reducing their emissions in order to remain competitive internationally in terms of supply chains,” said Walton.
Sara Walton, co-director of the University of Otago Climate Change Research Network, warned of New Zealand’s reputational and financial risks for missing targets.
Agricultural emissions will continue to be taxed from 2030; however, rules for protecting significant natural areas to support biodiversity are suspended.
Other areas targeted by the government include energy and natural resources.
It will reinstate oil and gas exploration, previously banned by Jacinda Ardern in 2018, to reduce coal imports and lower energy prices.
The government aims to double mineral exports to NZ$2 billion in 10 years and has announced a resource stocktake.
It also proposes a fast-track process, enabling mines to bypass current consents with ministerial approval.
Cindy Baxter, chair of Kiwis against Seabed Mining, fears this could enable a controversial project on New Zealand’s west coast.
“It’s a beautiful piece of ocean with reefs and sea life… which could be absolutely destroyed by seabed mining,” Baxter said.
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