International Energy Agency and its Sustainable Recovery

On Thursday, the International Energy Agency (IEA) published the report. The purpose of the Sustainable Recovery report is to present world leaders with cost-effective measures that could be implemented from 2021 through 2023.

Moreover, this report contains many interesting details. For example, a $3 trillion green recovery plan is a once-in-a-lifetime roadmap. Thanks to this roadmap governments around the world will be able to rebuild their economies in the wake of the coronavirus pandemic.

It is worth noting that the sustainable recovery plan sets out three main goals. The first one is to rejuvenate the economy, as without economic growth it will be hard to solve the problems. The second one is to create jobs and the third one is to build more resilient and cleaner energy systems.

According to Fatih Birol, executive director of the International Energy Agency, policymakers have to make very important decisions in a short period of time. They should keep in mind that these decisions will shape economic and energy infrastructure for decades. Moreover, their decisions will determine whether the world has a chance to meet its long-term energy as well as climate goals.

International Energy Agency and the global economy

The coronavirus pandemic triggered an unprecedented global health crisis. According to the International Energy Agency, the world is experiencing its worst economic shock since the 1930s. Importantly, economic shock had a tremendous impact on employment and investment across all parts of the economy. The energy sector is not an exception. Moreover, this shock continues to affect the global economy.

Interestingly, the IEA has previously warned that it believes the coronavirus crisis prepared the foundation for the largest decline of global energy investment on record in 2020. Importantly, the agency expects spending to drop by 20%.

In 2019, the global energy industry employed roughly 40 million people. However, 3 million jobs have either been lost or at risk due to the coronavirus pandemic.

The main question is how to support the economy and at the same time to reach this goal by making the world economy stronger to deal with such issues in the future.

Important, the Sustainable Recovery report was created thanks to the collaboration with the International Monetary Fund. This report is part of the energy agency’s flagship World Energy Outlook series.

According to the IEA, the plan could 1.1 percentage points to global economic growth each year through 2023. However, to achieve this goal it is necessary to invest around $1 trillion annually over the next three years.