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INDICATORS OF SUSTAINABLE DEVELOPMENT
FRAMEWORK AND METHODOLOGIES
ECONOMIC INDICATORS
Foreword
In the four years since the Rio Summit, there have been many
initiatives to promote sustainable development. Indicators are useful
tools to gain insight regarding the progress made in achieving sustainable
development. Agenda 21 calls for countries, international organizations
and non-governmental organizations to develop and use indicators of
sustainable development.
Building on many national and international initiatives aimed at
developing and using indicators, the Commission on Sustainable Development
in 1995 adopted a work programme on indicators for sustainable development.
The work programme includes an initial set of 130 indicators.
To facilitate the use of these indicators and to test their
practicability at the same time, methodology sheets have been developed for
each of them. This publication presents these methodology sheets.
It is essential to get feedback on the indicators and the methodology
sheets. We, in the CSD secretariat, look forward to your reactions and
comments. The goal is to have a good set of indicators for sustainable
development by the year 2000. We count on the users of this publication to
contribute to this goal.
On behalf of the United Nations, I would like to thank all of those
who have participated in the process of making this publication possible.
Joke Waller-Hunter
Director
Division for Sustainable Development
Department for Policy Coordination
and Sustainable Development
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Table of Contents
Page
Foreword
Table of contents v
Introduction vii
Working list of indicators of sustainable development ix
Methodology sheets:
Indicators for social aspects of sustainable development 1
Chapter 3: Combating poverty 3
Chapter 5: Demographic dynamics and sustainability 31
Chapter 36: Promoting education, public awareness and
training 44
Chapter 6: Protecting and promoting human health 83
Chapter 7: Promoting sustainable human settlement
development 123
Indicators for economic aspects of sustainable development 150
Chapter 2: International cooperation to accelerate
sustainable development in countries
and related domestic policies 152
Chapter 4: Changing consumption patterns 166
Chapter 33: Financial resources and mechanisms 184
Chapter 34: Transfer of environmentally sound
technology, cooperation and
capacity-building 201
Indicators for environmental aspects of sustainable development 210
Water
Chapter 18: Protection of the quality and supply
of freshwater resources 213
Chapter 17: Protection of the oceans, all kinds of
seas and coastal areas 233
Land
Chapter 10: Integrated approach to the planning
and management of land resources 245
Chapter 12: Managing fragile ecosystems: combating
desertification and drought 255
Chapter 13: Managing fragile ecosystems: sustainable
mountain development 269
Chapter 14: Promoting sustainable agriculture and
rural development 280
Other natural resources
Chapter 11: Combating deforestation 298
Chapter 15: Conservation of biological diversity 311
Chapter 16: Environmentally sound management of
biotechnology 318
Atmosphere
Chapter 9: Protection of the atmosphere 323
Waste
Chapter 21: Environmentally sound management of
solid wastes and sewage-related issues 349
Chapter 19: Environmentally sound management of
toxic chemicals 364
Chapter 20: Environmentally sound management of
hazardous wastes 366
Chapter 22: Safe and environmentally sound
management of radioactive wastes 382
Indicators for institutional aspects of sustainable development 385
Chapter 8: Integrating environment and development
in decision-making 386
Chapter 35: Science for sustainable development 395
Chapter 39: International legal instruments and
mechanisms 404
Chapter 40: Information for decision-making 411
Chapter 23-32: Strengthening the role of major groups 419
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Introduction
On occasion of its third session, in April 1995, the Commission on
Sustainable Development (CSD) approved a work programme on indicators of
sustainable development. The work programme included a list of
approximately 130 indicators organized in the Driving Force - State -
Response Framework. In this framework, Driving Force indicators represent
human activities, processes and patterns that impact on sustainable
development, State indicators indicate the "state" of sustainable
development, and response indicators indicate policy options and other
responses to changes in the state of sustainable development.
The indicators are intended for use at the national level by
countries in their decision-making processes. Not all of the indicators
will be applicable in every situation. It is understood that countries
will choose to use from among the indicators those relevant to national
priorities, goals and targets.
Following the decision of the CSD and the adoption of an
implementation plan by experts from various organizations involved in the
follow-up, the process of developing methodology sheets for each of the
indicators was started. The purpose of the methodology sheets is to
provide users at the national level with sufficient information about the
concept, significance, measurement and data sources for each indicator so
as to facilitate data collection and analysis. The process was coordinated
by the United Nations Department for Policy Coordination and Sustainable
Development (DPCSD) but builds upon indicator work being carried out in
several organizations. The process was marked by a high degree of
collaboration among a large number of organizations of the United Nations
system, other intergovernmental organizations, and non-governmental
organizations.
Organizations which have contributed both to the development of the
indicators and to the preparation of the methodology sheets include the
following: the United Nations Department for Economic and Social
Information and Policy Analysis (DESIPA); the United Nations Department for
Policy Coordination and Sustainable Development (DPCSD); the United Nations
Department for Development Support and Management Services (DDSMS); the
United Nations Department for Humanitarian Affairs (DHA); the secretariat
of the Framework Convention on Climate Change; the United Nations
Children~s Fund (UNICEF); the United Nations Conference on Trade and
Development (UNCTAD); the United Nations Development Programme (UNDP) and
its Office to Combat Desertification and Drought (UNSO); the United Nations
Environment Programme (UNEP) and the secretariat of the Basel Convention;
the United Nations University; the Regional Commissions of the United
Nations; the United Nations Centre for Human Settlements (Habitat); the
International Labour Organization (ILO); the Food and Agriculture
Organization of the United Nations (FAO); the United Nations Educational,
Scientific and Cultural Organization (UNESCO); the World Health
Organization (WHO); the International Telecommunication Union (ITU); the
World Meteorological Organization (WMO); the United Nations Industrial
Development Organization (UNIDO); the World Bank; the International Atomic
Energy Agency (IAEA); the European Communities Statistical Office; the
Organization for Economic Co-operation and Development (OECD); the
International Centre for Tropical Agriculture (CIAT); the International
Conservation Union (IUCN); the International Institute for Sustainable
Development (IISD); the International Institute of Applied Systems Analysis
(IIASA); the National Institute for Public Health and Environmental
Protection of the Netherlands (RIVM); the New Economics Foundation; the
Scientific Committee on Problems of the Environment (SCOPE); the Worldwatch
Institute; the World Resources Institute (WRI); the World Wide Fund for
Nature (WWF); and the Wuppertal Institute.
In February 1996, a meeting of government experts was organized by
the Environment Agency of Japan, in cooperation with DPCSD, in Glen Cove,
New York, to discuss and evaluate the methodology sheets from the point of
view of potential users. The methodology sheets were also circulated among
a roster of international experts for their comments.
The responsible organizations revised the methodology sheets
accordingly and a first draft of the publication was presented as a
Background Paper no. 15, at the fourth session of the Commission on
Sustainable Development, in April/May 1996. Since then additional and
revised methodology sheets have been submitted by the lead agencies and
were incorporated into the revised edition of the document. In a few
instances, methodology sheets are still being developed and in these cases,
a "bookmark" has been included, stating the name of the indicator, a brief
definition, the unit of measurement, and its placement in the framework.
The work on completing and revising the methodology sheets will continue,
as the CSD work programme on indicators now enters its second phase.
The second phase concentrates on enhancement of information exchange
among all interested partners, training and capacity building at the
regional and national levels and monitoring the use of the indicators in
countries that have shown interest in this process. The publication will
now be forwarded to all Governments to assist them in working with
indicators in their decision-making processes. As feedback and results
from testing, analytical work are discussed, further improvements in the
indicators and methodology sheets will be implemented. This includes in
the longer run, additional work on interlinkages, highly aggregated
indicators and the conceptual framework and compilation of environmental
indicators.
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Methodology Sheets
Indicators for Economic Aspects of Sustainable Development
Table of Contents
Page
Chapter 2: International cooperation to accelerate sustainable
development in countries and related domestic policies 152
- GDP per capita 152
- Net investment share in GDP 156
- Sum of exports and imports as a percent of GDP 158
- Environmentally adjusted Net Domestic Product 160
- Share of manufactured goods in total merchandise
exports 163
Chapter 4: Changing consumption patterns 166
- Annual energy consumption 166
- Share of natural-resource intensive industries in
manufacturing value-added 168
- Proven mineral reserves 171
- Proven fossil fuel energy reserves 172
- Lifetime of proven energy reserves 174
- Intensity of material use 176
- Share of manufacturing value-added in GDP 179
- Share of consumption of renewable energy resources 182
Chapter 33: Financial resources and mechanisms 184
- Net resources transfer / GNP 184
- Total ODA given or received as a percentage of GNP 187
- Debt / GNP 189
- Debt service / export 192
- Environmental protection expenditures as a
percent of GDP 194
- Amount of new or additional funding for sustainable
development 197
Chapter 34: Transfer of environmentally sound technology,
cooperation and capacity-building 201
- Capital goods imports 201
- Foreign direct investments 203
- Share of environmentally sound capital goods imports 205
- Technical cooperation grants 208
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GROSS DOMESTIC PRODUCT PER CAPITA
Category: Economic
1. Indicator
(a) Name: Gross domestic product (GDP) per capita.
(b) Brief Definition: Levels of GDP per capita are obtained by dividing
annual or period GDP at current market prices by population. A variation of
the indicator could be the growth of real GDP per capita which is derived by
computing the annual or period growth rate of GDP in constant basic producers'
or purchasers' prices divided by corresponding population.
(c) Unit of Measurement: $US.
2. Placement in the Framework
(a) Agenda 21: Chapter 2: International Cooperation to Accelerate
Sustainable Development in Developing Countries and Domestic Policies.
(b) Type of Indicator: Driving Force.
3. Significance (Policy Relevance)
(a) Purpose: The indicator is a basic economic growth indicator and
measures the level and extent of total economic output. It reflects changes
in total production of goods and services.
(b) Relevance to Sustainable/Unsustainable Development: Growth in the
production of goods and services is a basic determinant of how the economy
fares. By allocating total production to each unit of population, the extent
to which the rate of individual output contributes to the development process
can be measured. It indicates the pace of per capita income growth and also
the rate that resources are used up. As a single composite indicator of
economic growth, it is a most powerful summary indicator of the economic state
of development in its many aspects. It does not directly measure sustainable
development but it is a very important measure for the economic and
developmental aspects of sustainable development, including people's
consumption patterns and the use of renewable resources.
(c) Linkages to Other Indicators: As a highly aggregated composite
measure, this indicator has close links with many, more disaggregated
indicators.
Examples would include population growth, net migration, other GDP indicators,
land use change, arable land per capita, and forest area.
(d) Targets: National targets are generally oriented towards priorities,
availability of resources and, in large measure, to historical economic
performance. International targets are most often established by financial
institutions and international organizations only for the purposes of
intercountry comparison of economic performance in determining the direction
of aid distribution or resource allocation projects. Country groupings to
form economic entities, for example, the European Community, Organization of
Petroleum Exporting Countries (OPEC), and the Benelux countries, also set
international targets among constituent members to serve as guidelines in
national policy priority setting. Moreover, the United Nations uses average
world per capita income as a threshold in setting the level of relief
allowance for countries with large population in its formulation of the scale
of assessments of member states.
(e) International Conventions and Agreements: The 1993 System of National
Accounts (SNA) provides international standards for national accounts.
4. Methodological Description and Underlying Definitions
(a) Underlying Definitions and Concepts: GDP as defined in the 1993 SNA
can be defined in three ways: Firstly, it is the sum total value- added of
all production units including all taxes and subsidies on products which are
not included in the valuation of output. It is also equal to the sum of final
uses of goods and services (except intermediate consumption) measured in
purchasers' prices, less the value of imports of goods and services. Finally,
it can be measured as the sum of primary incomes distributed by resident
producer units.
(b) Measurement Methods: The current price estimates of GDP are adjusted
to GDP at constant prices with the use of price deflators. Population
estimates enable the conversion of total GDP to per capita levels, while
exchange rates and other conversion factors are used to arrive at values based
on a common unit of currency. Real GDP is derived by extrapolating total
value-added in the base year with production indicators in physical terms or
by deflating current price values by a price deflator.
(c) The Indicator in the DSR Framework: GDP per capita deals with the
processes and patterns of economic forces. As such, it is recognized as a
composite Driving Force indicator of sustainable development within the DSR
Framework. However, it can also be regarded as a measure of the State of a
country's economy in relation to population.
(d) Limitations of the Indicator: As a necessary condition to being a key
economic performance indicator of sustainable development, one of the
often-cited limitations of GDP is that it does not account for the social and
environmental costs of production; it therefore is not a good measure of the
level of over-all well being. For example, GDP per capital reveals nothing
concerning energy and material interactions with the environment. GDP is also
not considered a good measure of sustainable consumption because it does not
allow for the capital used up in the production process.
There may exist some differences in national accounting and demographic
reporting procedures and practices between countries. One other possible
drawback could lie in the comparability of price information used in deflating
current price data and technical differences in the choice of base year for
the original data. Additionally, a considered basic limitation lies in the
conversion of GDP into a common denomination as a result of current
misalignments in exchange rates for some countries vis-a-vis the comparator
currency (US dollar) particularly for those countries in transition whose
market exchange rates produce unrealistic levels of GDP, making any meaningful
intercountry interpretation difficult.
The conversion rates used by the UN Statistics Division (UNSD) are normally
the market or blended rates of exchange obtained from the International
Monetary Fund (IMF). In some cases, use is made of UN operational rates which
are established primarily for the settlement of administrative transactions
between host countries and the UN. In very unique circumstances the use of
purchasing power parities (PPP) or price-adjusted rates of exchange (PARE) is
necessary. The World Bank also uses a special exchange rate where the official
exchange rate produces distortion in the dollar levels of GDP.
(e) Alternative Definitions: Economic indicators that measure the
achievement of higher levels of goods and services more efficiently are better
indicators of sustainable development. Consumption trends are better
reflected by such indicators as Personal Consumption expenditures as used in
the USA. This indicator can be derived from the SNA.
5. Assessment of the Availability of Data from International and National
Sources
The indicator has no serious limitations in terms of data availability. The
principal data elements for a majority of countries are mostly and regularly
available from national and international sources on a historical basis.
Internationally accepted conceptual guidelines, are also available to assist
with the compilation of the indicator. Annual GDP data in current and
constant prices are generally reported by national statistical offices or
central banks in the United Nations (UN) National Accounts questionnaire and
supplemented by estimates prepared by the UN as well as other international
organizations such as the World Bank and the IMF. The Organisation for
Economic Co-operation and Development (OECD) compiles quarterly GDP estimates
for its Members. Population data are mainly obtained either through censuses
or surveys. These are supplemented by growth estimates prepared by the UN
Population Division.
6. Agencies Involved in the Development of the Indicator
The lead agency is the United Nations Department of Economics and Social
Information (DESIPA). The lead contact is the Director, Statistics Division,
DESIPA; fax no. (1 212) 963 9851.
7. Further Information
(a) Statistics and Data:
Comprehensive national accounts statistics are published by the UN in the
series National Accounts Statistics: Main Aggregates and Detailed Tables. A
historical series of GDP is available from the national accounts database of
the UN Statistics Division.
Population data and projections are available in the World Population
Prospects published by the Population Division of the UN Department of
Economic and Social Information and Policy Analysis.
Exchange rates are published by the IMF in International Financial Statistics.
(b) Status of the Methodology:
The 1993 SNA provides international standards on national accounts and is the
product of collaborative efforts between EUROSTAT, IMF, OECD, UN and the World
Bank.
LEAD AGENCY: DESIPA
NET INVESTMENT SHARE IN GROSS DOMESTIC PRODUCT
Category: Economic
1. Indicator
(a)Name: Net investment share in Gross Domestic Product (GDP).
(b)Brief Definition: This indicator measures the net share of investment in
relation to total production. It is obtained by dividing gross production
capital formation by gross domestic product, both at purchasers' prices.
(c)Unit of Measurement: %.
2. Placement in Framework
(a) Agenda 21: Chapter 2: International Cooperation to Accelerate
Sustainable Development in Developing Countries and Related Domestic Policies.
(b) Type of Indicator: Driving Force.
3. Significance (Policy Relevance):
(a) Purpose: The rate of investment measures the stimulus to economic
development, reflecting the infusion of requisite capital to finance the
development process.
(b) Relevance to Sustainable/Unsustainable Development: This indicator
deals with the processes and patterns of economic activities. It is an
important element of the sustainable development process in developing
countries, aimed at increasing their partnership in the global economy. It
reflects an important financial component aimed at accelerating the pace of
development.
(c) Linkages to Other Indicators: This indicator is closely linked with
other measures of economic development, in particular GDP per capita and share
of manufacturing in GDP.
(d) Targets: National targets for investment share to GDP are usually
included in government policy as a basis for budget funding programmes and for
priority-setting exercises.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
Gross capital formation (gross investment) is defined in the System of
National Accounts (SNA) as the total value of gross fixed capital formation
plus changes in inventories and acquisitions less disposal of valuables.
Fixed capital formation is the total value of a producer's acquisitions of
fixed assets, less disposal, together with certain additions to the value of
non-produced assets. Gross capital formation includes outlays on additions
of new durable goods to stocks of fixed asset by industries, producers of
government services, the private sector, non-profit services, and households,
but excludes outlays of government services on durable goods for military use.
It is further classified into new and existing tangible (dwellings, buildings
and structures, machineries and equipment, etc.) and intangible (mineral
exploration, computer software, entertainment, artistic and literary
originals, etc.) assets.
However, investments in SNA terms, as in this indicator, constitute only
investments on produced assets. Any expenditure on non-produced assets, for
example, land or payments for education and health that enhance the quality
of human capital are not included.
An alternative indicator would be one which would identify selected investment
expenditures by sector, such as environmental protection, health and
education, housing, nutrition etc., that are individually considered relevant
to sustainable development. A second alternative would report the indicator
using gross fixed capital formation.
5. Assessment of the Availability of Data from National and International
Sources
The concept of gross capital formation is standardized in the SNA and
therefore comparable between countries. Data is of reasonable quality and
commonly available from national sources on a historical basis.
Data on gross capital formation and GDP are generally reported by national
statistical offices or central banks to the UN National Accounts
questionnaire. These are supplemented by estimates prepared by the United
Nations Statistical Division (UNSD) as well as other international
organizations, such as the World Bank and the International Monetary Fund
(IMF).
6. Agencies Involved in the Development of the Indicator
This indicator was developed by the United Nations Department of Economics and
Social Information and Policy Analysis (DESIPA). The principal contact point
in terms of SNA references as well as data compilation on an international
level is the Director, Statistics Division, DESIPA; fax no. (1 212) 963 9851.
7. Further Information
Further details on the conceptual definition of GDP are contained in the
System of National Accounts, 1993.
National accounts statistics are published in the series National Accounts
Statistics: Main Aggregates and Detailed Tables.
LEAD AGENCY: DESIPA
SUM OF EXPORTS AND IMPORTS AS A PERCENT OF GROSS DOMESTIC PRODUCT
Category: Economic
1. Indicator
(a) Name: The sum of exports and imports as a percent of Gross Domestic
Product (GDP).
(b) Brief Definition: This is a measure of the openness of an economy,
represented as the sum of exports and imports of goods and services as a ratio
of GDP.
(c) Unit of Measurement: %.
2. Placement in the Framework
(a) Agenda 21: Chapter 2: International Cooperation to Accelerate
Sustainable Development in Developing Countries and Related Domestic Policies.
(b) Type of Indicator: Driving Force.
3. Significance (Policy Relevance)
(a) Purpose: The purpose of this indicator is to measure the openness of
a country's economy to international trade.
(b) Relevance to Sustainable/Unsustainable Development: In general,
international trade promotes better utilization of resources domestically and
globally. This relationship between trade and sustainable development is
specifically recognized by Agenda 21. Thus, if an economy is more open to
international trade, it can benefit more from the given resources.
Dynamically, the economy can also benefit from innovative technologies
available throughout the world. However, since prices of internationally
traded goods and services do not reflect fully environmental costs and
benefits, international trade may not always promote better utilization of
environmental resources. Also, while the indicator captures the degree to
which an economy is integrated with the international economy, it does not
show environmental effects (depletion, pollution) associated with particular
material flows.
(c) Linkages to Other Indicators: This indicator is closely linked to
other economic, environmental, and institutional indicators, such as GDP per
capita, capital goods imports, imports and exports of hazardous wastes,
sustainable development strategies, and ratification and implementation of
international agreements.
(d) Targets: Not available.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
Exports and imports of goods and services are standard items in the balance
of payments and national accounts. Exports of goods and services consist of
sales, barter, or gifts or grants, of goods and services from residents of
an economy to non-residents, while imports consist of purchases, barter, or
receipts of gifts or grants, by residents from non-residents. Goods include
general merchandise, goods for processing, major repairs on goods, goods
procured in ports by carriers and non-monetary gold. Services include
transportation, communication, travel, construction services, insurance,
financial services, computer and information services, royalties and license
fees, other business services, personal, cultural and recreational services,
and government services. In general, exports and imports of goods are recorded
at the market value of the goods at the customs frontier of the economy from
which they are exported. Thus, the value of exports or imports do not include
customs tariff. Exports and imports of services are valued at the actual price
agreed upon between resident and non-resident.
GDP is a measure of the value created by the productive activities of the
economy's residents. The GDP used for this indicator should be valued at
purchasers' prices.
5. Assessment of the Availability of Data from International and National
Sources
Data for this indicator is generally available. The openness of a country's
economy can be derived from national accounts data on exports and imports of
goods and services, and GDP in national currency terms. However, when the
official exchange rate is significantly appreciated or depreciated in real
terms, the openness indicator derived from national accounts data may be
distorted. In such cases, the indicator can be computed from the balance of
payments data on exports and imports in US dollars and GDP data converted to
US dollars at the implicit exchange rate, effectively applied to actual
foreign exchange transactions.
For the underlying national accounts data, the principal contact is the
Statistical Division of the United Nations Department for Economic and Social
Information and Policy Analysis (DESIPA); and for the balance of payments
data, it is the Statistics Department of the International Monetary Fund
(IMF).
6. Agencies Involved in the Development of the Indicator
The lead agency involved in the development of this indicator is the World
Bank (WB). The contact point is the Chief, Indicators and Environmental
Valuation Unit, Environment Department, WB; fax no. (1-202) 477 0968.
7. Further Information
Further details on the concepts and definitions for exports and imports of
goods and services can be found in the IMF's 5th Manual on Balance of Payments
or DESIPA's 1993 System of National Accounts (SNA). GDP definitions and
concepts can be found in the 1993 SNA.
LEAD AGENCY: WORLD BANK
ENVIRONMENTALLY ADJUSTED NET DOMESTIC PRODUCT
Category: Economic
1. Indicator
(a) Name: Environmentally Adjusted Net Domestic Product (EDP) per capita.
(b) Brief Definition: This indicator is obtained by deducting
environmental costs from Net Domestic Product and dividing it by the total
population of the country of reference.
(c) Unit of Measurement: $US.
2. Placement in the Framework
(a) Agenda 21: Chapter 2: International Cooperation to Accelerate
Sustainable Development in Developing Countries and Related Domestic
Economies.
(c) Type of indicator: State.
3. Significance (Policy Relevance)
(a) Purpose: The trend of EDP can be used to measure sustainable economic
growth. An upward trend of EDP would imply a more sustainable economic
growth.
(b) Relevance to Sustainable/Unsustainable Development: Environmentally
adjusted value-added facilitates the assessment of sectoral distortion in the
economy. It also helps to identify the major sources of sustainable growth.
Thus, trends in aggregate EDP and changes in the structural contributions to
EDP provide the best measure of growth and structural change from a
sustainable development viewpoint. It can help set economic instruments for
internalizing the budgets of households and enterprises in order to encourage
microeconomic behaviour towards environmentally sound production and
consumption.
A number of factors other than produced and natural capital may affect the
sustainability of trends of EDP. They include technological progress,
discovery of natural resources, changes in production and consumption
patterns, natural and man-made disasters, inflation, debt level and the
productivity of human and institutional "capital".
(c) Linkages to Other Indicators: This indicator represents an aggregated
measure which is closely linked to other economic and environmental
indicators, especially in areas like technological transfer, changes in
consumption patterns, and use of natural resources. It is also linked to
other indicators which measure domestic product.
(d) Targets: Not available.
(e) International Conventions and Agreements: The United Nations
Conference on Environment and Development (UNCED) recommended the
implementation of the System of Integrated Environmental and Economic
Accounting (SEEA) in all member states.
4. Methodological Description and Underlying Definitions
EDP is one of the results of the compilation of environmental accounts.
Various methodologies, which are variations of the System of Integrated
Environmental and Economic Accounting have been developed by the United
Nations Statistical Division (UNSD) as satellite systems of the System of
National Accounts (SNA), and have been tested in several countries. However,
conceptually, the methodology has yet to be fully developed and widely
accepted.
One aspect of the calculation of EDP consists of the valuation of
environmental costs such as degradation and depletion of water, air, forests,
and wilderness species. These costs are imputed costs and therefore represent
estimates of the costs that would have been incurred to keep the natural
environment intact during the accounting period.
Alternatively, this indicator can be calculated by adding environmentally
adjusted final demand categories of consumption, net capital accumulation and
(net) exports and dividing by total population of the country. Environmentally
adjusted value added is the contribution to EDP by economic sectors. Another
alternative indicator is represented by the savings rate as proposed by the
World Bank. It is calculated using the same data, it reflects both natural
and human capital, and is analytically powerful. Other satellite accounts,
such as resource stocks, waste outputs, and environmental protection
expenditures, offer less aggregated measures, but may be more useful and
acceptable to countries.
5. Assessment of the Availability of Data from National and International
Sources
Environment statistics data, such as stocks and changes in stocks of natural
resources, emissions in physical terms, data on market prices, and costs of
the extraction of natural resources, provide the basic information necessary
for the compilation of environmentally adjusted value added and EDP. Data on
emissions or emission coefficients are generally not available in developing
countries. Data sources tend to be disparate, but typically include the
following agencies: statistical offices; and ministries of agriculture,
environment, forestry, fisheries, planning, construction. and mining; and the
central bank.
6. Agencies Involved in the Development of the Indicator
The United Nations Statistical Division (UNSD) is the lead agency and is
continuing to carry out several country projects in integrated environmental
and economic accounting. This work is completed in cooperation with
governments, and with the financial support of the World Bank, the United
Nations Development Programme (UNDP), and the United Nations Environment
Programme (UNEP). The contact point in UNSD is the Director, Statistical
Division, the Department of Economics and Social Information and Policy
Analysis; fax no. (1 212) 963 9851.
7. Further Information
Further details on EDP can be found in:
United Nations. Integrated Environmental and Economic Accounting. 1993.
DESIPA. Environmental Accounting: An Operational Perspective. Working Paper
No. 1.
LEAD AGENCY: DESIPA
SHARE OF MANUFACTURED GOODS IN TOTAL MERCHANDISE EXPORTS
Category: Economic
1. Indicator
(a) Name: Shared of manufactured goods in total merchandise exports.
(b) Brief Definition: This indicator is defined as the percentage share
of manufactured goods in total merchandise exports.
(c) Unit of Measurement: %.
2. Placement in the Framework
(a) Agenda 21: Chapter 2: International Cooperation to Accelerate
Sustainable Development in Development Countries and Domestic Policies.
(b) Type of Indicator: State.
3. Significance (Policy Relevance)
(a) Purpose: The indicator is meant to represent one aspect of
international cooperation, namely a country's access to and participation in
the global markets for manufactured goods.
(b) Relevance to Sustainable/Unsustainable Development: The significant
and growing presence in the global markets for manufactures is one element
significant to sustainable development of a country. Largely stable earnings
from exports of manufactures are an important source of resources for
investment in sustainable forms of development. However, export strategies
must be considered within the context of domestic development priorities.
Trends in the indicator are important for individual countries and for cross-
country comparisons.
(c) Linkages to Other Indicators: The indicator is closely linked to
other economic indicators especially in the areas of international cooperation
and changing consumption patterns. Such indicators would include Gross
Domestic Product (GDP) per capita, and the share of manufacturing value added
in GDP.
(d) Targets: No specified targets have been established for the
attainment of this indicator.
(e) International Conventions and Agreements: There are no international
conventions or agreements related to this indicator.
4. Methodological Description and Underlying Definitions
(a) Underlying Definitions and Concepts: The elements of the indicator
that require definition are the total value of merchandise exports; and the
value of exports of those product categories that can be considered to form
the trade equivalent to production of manufactured goods. The first element
is uniformly defined in international trade statistics. For the second
element, the following sub-categories from the Standard International Trade
Classification (SITC) are relevant: chemicals (SITC code 5); manufactured
goods chiefly classified by material (SITC code 6); excluding non-ferrous
metals (SITC code 68); machinery and transport equipment (SITC code 7); and
miscellaneous manufactured articles (SITC code 8). The basic concepts
involved in the definitions of the two elements are readily available from
standard documentation on international trade statistics (see section 7
below).
(b) Measurement Methods: Since the indicator is based on detailed
international trade statistics, measurement issues relate to general
international trade statistics (see references in section 7 below).
(c) The Indicator in the DSR Framework: In terms of the DSR framework the
indicator generally characterizes the state of access to export participation
in global markets for manufactured goods.
(d) Limitations of the Indicator: Care must be exercised in the
interpretation of this indicator within the context of overall development
priorities. As with any attempt to classify manufactured goods, limitations
arise from imprecisions in the present definitions of the SITC.
5. Assessment of the Availability of Data from International and National
Sources
(a) Data Needed to Compile the Indicator: Only summary international trade
statistics are needed to compile the indicator.
(b) Data Availability: The data described under 4a above are available at
the national level for most countries on a regular basis, and in a form that
allows for meaningful international comparisons.
(c) Data Sources: The primary international source for time series of
internationally comparable data are the United Nations trade tapes. The most
recent country information can usually be obtained from national statistical
institutions.
6. Agencies Involved in the Development of the Indicator
The lead agency is the United Nations Industrial Development Organization
(UNIDO). The contact point: is the Chief, Industrial Statistics Branch,
Information and Research Division, UNIDO; fax no. (43 1) 232 156.
7. Further Information
(a) Further Readings:
Forstner H. and R. Ballance. Competing in a Global Economy, An Empirical Study
on Specialization and Trade in Manufactures. London, Unwin Hymann, 1990.
UNIDO International Comparative Advange in Manufacturing, Changing Profiles
of Resources and Trade. Sales No. E.85.II.B.9. 1986.
UNIDO. Changing Patterns of Trade in World Industry, An Empirical Study on
Revealed Comparative Advantage. Sales E.82.II.B.1. 1984.
(b) Other References:
Commodity Indexes for the Standard International Trade Classification.
Revision 2, Statistical Papers, Series M No.38/Rev. United Nations
Publication, Sales No. E.81.XVII.3.
(c) Status of the Methodology:
The methodology for international trade statistics relevant to the present
indicator has been agreed to by numerous intergovernmental fora.
LEAD AGENCY: UNIDO
ANNUAL ENERGY CONSUMPTION
Category: Economic
1. Indicator
(a) Name: Annual energy consumption per capita.
(b) Brief Definition: The amount of energy - liquid, solid, gaseous or
electricity - used by an individual in a given year in a given geographical
area.
(c) Unit of Measurement: Gigajoules.
2. Placement in Framework
(a) Agenda 21: Chapter 4: Changing Consumption Patterns.
(b) Type of Indicator: Driving Force.
3. Significance (Policy Relevance)
(a) Purpose: The purpose of this indicator is to measure energy
consumption.
(b) Relevance to Sustainable/Unsustainable Development: Energy use is a
key aspect of consumption and production. Traditionally energy has been
regarded as the engine of economic progress. However, its production, use, and
byproducts have resulted in major impacts on the environment. The decoupling
of energy use from development represents a major challenge of sustainable
development. The long term aim is for development and prosperity to continue
through gains in energy efficiency rather than increased production.
(c) Linkages to Other Indicators: This indicator is closely linked with
many other economic and environmental indicators, such as population growth,
transport fuel consumption, environmentally adjusted domestic product, proven
energy reserves, consumption of renewable to non-renewable energy resources,
land use change, energy use in agriculture, emissions of greenhouse gases,
production of ozone depleting substances, generation of waste, etc.
(d) Targets: Not available.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
(a) Underlying Definitions and Concepts: The elements comprising this
indicator are production, population and consumption data. The data on
production refer to the first stage of production. For example, for hard coal
the data refer to mine production; for crude petroleum and natural gas, to
production at oil and gas wells and processing plants; for electricity to the
gross production of generating plants. The data on consumption refer to
"apparent consumption" and are derived from the formula which takes into
account production, imports, exports, and stock changes.
(b) Measurement Methods: This indicator is computed by calculating the
ratio of consumption of energy in a specific area/country/region to the
population in that area/country/region.
(c) The Indicator in the DSR Framework: This indicator represents a
major Driving Force within the economy.
(d) Limitations of the Indicator: Since this indicator is calculated by
the aggregation of different consumption data within an area/country/region it
may not accurately measure variations in the rates of consumption within that
area/country/region. This can lead to invalid calculations and
interpretations, and mis-allocation of resources. The indicator is not as
sensitive a measure of energy intensity and efficiency as some others, for
example environmentally adjusted domestic product.
(e) Alternative Indicator Definitions: Disaggregation of the indicator
into sectoral components such as agriculture or manufacturing, would permit
assessment of energy requirements per unit of output. On the other hand,
total energy consumption, provides a more direct measure of production
patterns and the implications for the environment, while energy consumption
as per unit of Gross Domestic Product provides a better reflection of energy
efficiency.
5. Assessment of the Availability of Data from National and International
Sources
Energy commodity data for production and consumption, and population data are
regularly available for most countries at the national level; and for some
countries, at the sub-national level. Both types of data are compiled by and
available from national statistical offices and country publications.
6. Agencies Involved in Development of Indicator
(a) Lead Agency: The lead agency is the United Nations Statistical
Division, department of Economics and Social Information and Policy Analysis
(DESIPA). The contact point is the Director, Statistics Division, DESIPA;
fax no. (1 212) 963 9851.
(b) Other Organizations: Other organizations involved in the indicator
development include: national statistical offices, the International Energy
Agency, the Organisation for Economic Co-operation and Development ( OECD),
and Eurostat.
7. Further Information
United Nations. Energy Statistics Yearbook.
LEAD AGENCY: DESIPA
SHARE OF NATURAL-RESOURCE INTENSIVE INDUSTRIES IN
MANUFACTURING VALUE-ADDED
Category: Economic
1. Indicator
(a) Name: Share of natural-resource intensive industries in manufacturing
value-added.
(b) Brief Definition: Percentage share of the contribution to
manufacturing value-added of those industries that are intensive in the use of
non-renewable natural resources.
(c) Unit of Measurement: %.
2. Placement in the Framework
(a) Agenda 21: Chapter 4: Changing Consumption Patterns.
(b) Type of Indicator: Driving Force.
3. Significance (Policy Relevance)
(a) Purpose: The indicator is meant to represent the potential impact of
the sub-sectoral structure of industrial production on the depletion of
non-renewable resources. It can be expected to capture a large portion of this
impact, although the complexity of the structure of natural-resource inputs
(direct and indirect) to industrial production prevents any such indicator
from being an ideal measure of sustainable development.
(b) Relevance to Sustainable/Unsustainable Development: The absorption
of non-renewable resources in the world economy is an important aspect of
sustainable development. This absorption is driven by three major factors: (i)
the patterns of final demand for goods which largely determine the derived
demand for resources; (ii) the supply response to this demand, reflected in
countries' sub-sectoral patterns of production and trade, which in turn, are
largely determined by comparative-advantage factors; and (iii) production
technology which is an important determinant of the resource intensity of the
production of each component sector of an economy. The proposed indicator is
intended to capture the structural element of point (ii) above at the country
level, where its scope is restricted to the manufacturing sector. The
interpretation of the proposed indicator is clear. Relatively low values of
or reductions in the above share are favourable to the natural resource aspect
of sustainable development of a particular country.
(c) Linkages to Other Indicators: The present indicator is closely linked
to indicators dealing with the development of the economy and the use of non-
renewable natural resources, including depletion of mineral resources, proven
mineral and energy reserves. It has more general links to other socioeconomic
and environmental indicators, such as generation of industrial waste.
(d) Targets: There are no specified targets established for this
indicator.
(e) International Conventions and Agreements: There are no international
conventions/agreements relating to the indicator (see section 3d above).
4. Methodological Description and Underlying Definitions
(a) Underlying Definitions and Concepts: The definitional elements of the
indicator are: (i) value-added of the entire manufacturing sector; and (ii)
value-added of those industries within manufacturing that are particularly
intensive in the direct use of non-renewable resources. The first element is
a standard variable in industrial statistics. For the second element, the
following industries are relevant (International Standard Industrial
Classification codes are given in parentheses): petroleum refineries (ISIC
353); manufacture of miscellaneous products of petroleum and coal (ISIC 354);
iron and steel basic industries (ISIC 371); and non-ferrous metal basic
industries (ISIC 372). The concepts involved in the definitions of these
elements are available in standard documentation on industrial statistics (see
section 7 below).
(b) Measurement Methods: Since the indicator is based on detailed
industrial statistics, measurement is standard as described in the
documentation of general industrial statistics (see references in section 7
below).
(c) The Indicator in the DSR Framework: The indicator is generally
characterized as a Driving Force measure of natural-resource intensity within
a country's industrial production.
(d) Limitations of the Indicator: At least four types of limitations
arise with the present formulation of the indicator: (i) in the present
version, only direct inputs of natural resources to industrial sub-sectors are
considered, while all indirect inputs are disregarded; (ii) the concept of
natural resources is confined to non-renewable ones; (iii) only broad
definitions are applied in the description of natural-resource intensive
industrial sub-sectors; and (iv) the indicator does not discriminate between
domestically produced and imported natural-resource inputs.
5. Assessment of the Availability of Data from International and National
Sources
(a) Data Needed to Compile the Indicator: Only general industrial
statistics are needed to compile the indicator.
(b) Data Availability: The data described under 4a above are available at
the national level for most countries on a regular basis and in a form that
allows for meaningful international comparisons.
(c) Data Sources: The primary source for internationally comparable time-
series data is the United Nations Industrial Development Organization (UNIDO)
Industrial Statistics Database. The most recent country information can
usually be obtained from national statistical institutions.
6. Agencies Involved in the Development of the Indicator
The lead agency is the United Nations Industrial Development Organization
(UNIDO). The contact point is the Chief, Industrial Statistics Branch,
Information and Research Division, UNIDO; fax no. (43 1) 232 156.
7. Further Information
(a) Further Readings:
International Standard Industrial Classification of All Economic Activities.
Statistical Papers, Series M, No.4/Rev.2. United Nations Publication, Sales
No. E.68.XVII.8.
International Recommendations for Industrial Statistics. Statistical Papers,
Series M, No. 48/Rev.1 United Nations Publication, Sales No.E.83.XVII.8.
Industrial Statistics for Research Purposes - Methodology Applied in the
Development and Maintenance of the UNIDO Industrial Statistics Data Base.
UNIDO/PPD.192.
(b) Other References:
Hammond, Allen, et al. Environmental Indicators: A Systematic Approach to
Measuring and Reporting on Environmental Policy Performance in the Context of
Sustainable Development, (Chapter VI and Appendix I). World Resources
Institute, Washington, D.C. 1995.
(c) Status of the Methodology:
The methodology for general industrial statistics relevant to the present
indicator has been agreed to by numerous intergovernmental fora.
LEAD AGENCY: UNIDO
PROVEN MINERAL RESERVES
Category: Economic
1. Indicator
(a) Name: Proven mineral reserves.
(b) Brief Definition: Orebodies or deposits economically viable for
extraction which have been sampled sufficiently enough to make reliable
estimates of spatial extent, tonnage, and average grade.
(c) Unit of Measurement: Tons.
2. Placement in the Framework
(a) Agenda 21: Chapter 4: Changing Consumption Patterns.
(b) Type of Indicator: State.
(Indicator under development)
LEAD AGENCY: DDSMS
PROVEN FOSSIL FUEL ENERGY RESERVES
Category: Economic
1. Indicator
(a) Name: Proven fossil fuel energy reserves.
(b) Brief Definition: Proven fossil fuel energy reserves are generally
defined as those quantities which geologic and engineering information
indicate can be recovered with reasonable certainty in the future from known
energy resources under existing economic and technical conditions.
(c) Unit of Measurement: Oil equivalent.
2. Placement in the Framework
(a) Agenda 21: Chapter 4: Changing Consumption Patterns.
(b) Type of Indicator: State.
3. Significance (Policy Relevance)
(a) Purpose: The purpose of the indicator is to measure availability of
fossil fuel energy resources.
(b) Relevance to Sustainable/Unsustainable Development: Energy is a key
aspect of consumption and production. This indicator provides a basis for
estimating future energy supplies enabling proactive decision making to ensure
the efficient use of these resources over the longer term. Proven energy
reserves represents a basic stock from which governments can use to attain
higher levels of sustainable development.
(c) Linkages to Other Indicators: Interpretation of this indicator is
enhanced when combined with annual energy production, annual energy
consumption per capita, and lifetime of proven energy reserves.
(d) Targets: Not available.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
Annual Production is the production of a commodity in a specified year.
Proved amount in place is the tonnage that has been both carefully measured
and assessed as exploitable under present and expected local economic
conditions with existing available technology. Proved recoverable reserves
are the tonnage of proved amount in place that can be recovered (extracted
from the earth in raw form) under present and expected local economic
conditions with existing available technology. Estimated additional amount in
place is the indicated and inferred tonnage additional to the proved amount
in place. The estimates are based on the results of geological and exploratory
information about an area or on evidence of duplication or parallelism of
geological conditions that occur in known deposits. Deposits, the existence
of which is merely speculative, are not included. Estimated additional
reserves recoverable is the quantity of the estimated additional amount in
place which might become recoverable within foreseeable economic and
technological limits. Reserves/production ratio (R/P) is computed by dividing
proven energy reserves of a commodity at the end of a year by the total
production of that commodity in that year.
5. Assessment of the Availability of Data from International and National
Sources
To compile this indicator data are needed on a country basis. Available
sources are national statistical offices and publications.
6. Agencies Involved in the Development of the Indicator
(a) Lead Agency: The lead agency is the United Nations Department of
Economics and Social Information and Policy Analysis. The contact point is
the Director, Statistics Division, DESIPA; fax no. (1 212) 963 9851.
(b) Other Organizations: The agencies involved in the development of this
indicator are the World Energy Council (WEC), the World Petroleum Congress
(WPC) and the International Gas Union (IGU).
7. Further Information
World Energy Council. Survey of Energy Resources. Annual Publication.
LEAD AGENCY: DESIPA
LIFETIME OF PROVEN ENERGY RESERVES
Category: Economic
1. Indicator
(a) Name: Lifetime of proven energy reserves.
(b) Brief Definition: Lifetime of proven energy reserves, known as the
production life index, is the ratio of energy reserves remaining at the end
of any year to the production of energy in that year.
(c) Unit of Measurement: Years.
2. Placement in the Framework
(a) Agenda 21: Chapter 4: Changing Consumption Patterns.
(b) Type of Indicator: State.
3. Significance (Policy Relevance)
(a) Purpose: This indicator provides an indication of the length of time
that proven reserves would last if production were to continue at current
levels.
(b) Relevance to Sustainable/Unsustainable Development: Energy is a key
aspect of consumption and production. This indicator provides a basis for
estimating future energy supplies enabling proactive decision making to ensure
the efficient use of these resources over the longer term. Lifetime of proven
energy reserves represents a basic stock indicator which governments and the
private sector can use in decision making to attain higher levels of
sustainable development. However, it is important to note different views on
resource scarcity as they apply to the interpretation of this indicator. One
view emphasizes the use of these scarce resources and their environmental
pollution consequences. The other view stresses the movement and changing
appearance of energy stocks, emphasizing substitution and material
recuperation.
(c) Linkages to Other Indicators: Interpretation of this indicator is
enhanced when combined with annual energy production, proven fossil fuel
energy reserves, intensity of material use, annual energy consumption per
capita, and waste recycling rate.
(d) Targets: Not available.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
Proven Energy Reserves are generally defined as those quantities which
geologic and engineering information indicate with reasonable certainty can
be recovered in the future from known energy resources under existing economic
and technical conditions. The reserves/production ratio (R/P) is computed by
dividing proven energy reserves of a commodity at the end of a year by the
total production of that commodity in that year.
The depletion rate or potential reserves provide alternative measures for this
indicator. The rate of use of energy reserves is very dependent on economic
conditions. In addition, the indicator cannot take account of unproven
resources, or those not currently unavailable due to technology or economic
limitations.
5. Assessment of the Availability of Data from International and National
Sources
Data on production and proven energy reserves are used to compile this
indicator. While data on production on a country basis are available on a
regular basis from various sources, data on proven energy reserves are only
available from the annual publication Survey of Energy Resources by the World
Energy Council and are subject to frequent revision.
6. Agencies Involved in the Development of the Indicator
(a) Lead Agency: The lead agency is the United Nations Department of
Economics and Social Information and Policy Analysis. The contact point is
the Director, Statistics Division, DESIPA; fax no. (1 212) 963 9851.
(b) Other Organizations: The World Energy Council (WEC) has been
associated
with the development of this indicator.
7. Further Information
World Energy Council. Survey of Energy Resources.
United Nations. Energy Statistics Yearbook.
LEAD AGENCY: DESIPA
INTENSITY OF MATERIAL USE
Category: Social
1. Indicator
(a) Name: Intensity of material use.
(b) Brief Definition: This indicator is defined as the consumption volume
of primary and secondary materials per unit of real Gross Domestic Product
(GDP). It is calculated for one commodity at the country level.
(c) Unit of Measurement: kg/tons/m3 per $1 000 US.
2. Placement in the Framework
(a) Agenda 21: Chapter 4: Changing Consumption Patterns.
(b) Type of Indicator: State.
3. Significance (Policy Relevance)
(a) Purpose: The intensity of material use provides a good indication of
long-terms trends in changing consumption patterns of the key non-fuel, non-
renewable natural materials.
(b) Relevance to Sustainable/Unsustainable Development: The proposed
indicator is relevant to sustainable development as it documents total
material consumption trends as well as changes in consumption patterns.
Declining intensity of material use implies a lower use of non-renewable
materials. Conversely, increasing intensity of material use does not
necessarily imply a higher use of non-renewable resources. The four-component
structure of the indicator (primary material use, consumption of secondary
material, changes in stocks, and consumption of material embodied in imported
products), allows an analysis of consumption of recovered versus virgin
resources.
The indicator comprises consumption of primary and secondary materials,
changes in stocks as well as materials contained in the most important
imported and exported material; and the intensive semi-fabricates and
manufactures. This would bring the indicator very close to measuring real
material absorption of an economy. Per-capita consumption volume of the
materials in question would be measured as a supplement facilitating the
interpretation of intensity of use trends.
The indicator can also be used as a proxy for assessing industrial pollution
at the national level. In the US, for example, it is estimated that material-
intensive industries account for about 70% of total air and water pollution.
Coefficients of throughput/pollution ratios can be used for this calculation
although it might be difficult to mirror exactly the dynamics of these
coefficients in the wake of technological change.
(c) Linkages to Other Indicators: This indicator is closely linked to
other indicators which measure the stage of economic development such as share
of manufacturing value-added to Gross Domestic Product (GDP), and investment
share in GDP.
(d) Targets: Not available.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
Based on the data base on minerals and metals from the United Nations
Conference on Trade and Development (UNCTAD), consumption volume of primary
and secondary material per country can be estimated. These figures are then
adjusted by (i) changes in stocks of producers, traders and manufacturers, and
(ii) the volume of material contained in net trade in material-intensive semi-
fabricates and manufactures. The calculated volume of material consumption is
thus put in relation to real GDP in order to compute material consumption per
unit of product. Intensity of use figures can be broken down into intensity
of use of primary versus secondary materials.
It is problematic to correctly estimate the consumption of secondary
materials, changes in stocks and the material contained in traded semi-
fabricates and manufactures. As far as the latter is concerned, conversion
factors of material content are being compiled and regularly updated to take
account of changing trends in manufacturing technologies. Country and regional
differences in this regard are however very difficult to reflect.
5. Assessment of the Availability of Data from International and National
Sources
Most of the required consumption and trade data are available in UNCTAD's own
data base on minerals and metals. Information on consumption of secondary
materials is incomplete but can be estimated with a reasonable degree of
accuracy. Data on changes in stocks, in particular at the level of traders and
manufacturers, are scant, although some reasonable estimates can be made.
Conversion factors on material content of semi-fabricates are being compiled
and regularly updated in collaboration with various industry associations.
Information in this regard, however, is often incomplete, not representative,
or too general.
The analysis of the use of some 20 commodities per unit of GDP at the country
level is currently being reconducted. The purpose is to update the results of
the 1991 survey, and to place emphasis on the analysis of consumption trends
of primary versus secondary materials.
6. Agencies Involved in the Development of the Indicator
(a) Lead Agency: The lead agency is the United Nations Conference on Trade
and Development (UNCTD). The contact point is the Coordinator, Sustainable
Development, UNCTD; fax no. (41 22) 907 0047.
(b) Other Organizations: Eurostat, the World Resources Institute, and the
Wuppertal Institute on Climate, Environment and Energy have contributed to the
development of this indicator.
7. Further Information
(a) Further Readings:
Eurostat. Primary Material Balances.
Ndiaye, D. Statistical Study on the Consumption of Metals. Centre d'Economie
des Ressources Naturelles, Ecole Nationale Supe'rieure des Mines de Paris.
Paris, 1991.
World Resources Institute. World Resources 1994-95, part IV, Chapter 21,
1995.
(b) Other References:
Behrensmeier, R. and S. Bringezu. On the Methodology of Analysing Macro-
economic Material Intensity. Wuppertal Institute on Climate, Environment and
Energy, Wuppertal Papers, No. 34, April 1995.
Hammond, Allen, et al. Environmental Indicators: A Systematic Approach to
Measuring and Reporting on Environmental Policy Performance in the Context of
Sustainable Development, (Chapter VI and Appendix I). World Resources
Institute, Washington, D.C., 1995.
Hoffmann, U and D. Zivkovic. Demand Growth for Industrial Raw Materials and
its Determinants: An Analysis for the Period 1965-1988. UNCTAD Discussion
Papers, No. 50, Geneva, November 1992.
LEAD AGENCY: UNCTAD
SHARE OF MANUFACTURING VALUE-ADDED IN GROSS DOMESTIC PRODUCT
Category: Economic
1. Indicator
(a) Name: Share of manufacturing value-added in gross domestic product.
(b) Brief Definition: This indicator measures the contribution of the
manufacturing sector in total production. It is obtained by devising the
value added in manufacturing by the total gross value-added to GDP at basic
or producers' prices.
(c) Unit of Measurement: %.
2. Placement in the Framework
(a) Agenda 21: Chapter 4: Changing Consumption Patterns.
(b) Type of Indicator: State.
3. Significance (Policy Relevance)
(a) Purpose: The manufacturing sector is a major structural component of
total economic activity, together with mining, construction, utilities,
natural resources, and services. The relative size of manufacturing is a
significant indicator of the state of the economy. It also hints at basic
driving forces associated with sustainable development.
(b) Relevance to Sustainable/Unsustainable Development: As a key economic
activity, manufacturing production has been used as a growth determinant,
reflecting the stage of country development in terms of availability of human
resources and capital, both essential requirements in the drive towards
sustainable development. Manufacturing depends largely on the development of
skills and equipment. Manufacturing activities also draw from a wide range
of resources and raw materials and, like them, may deplete and degrade natural
assets, for example, air, water, trees. The development of manufacturing
sector is seen as a key indicator of sustainable development progress by many
developing countries.
(c) Linkages to Other Indicators: This indicator is closely related to
other economic and environmental indicators reflecting the level of
development and use of natural resources, such as share of natural resource
intensive industries in manufacturing, depletion of mineral resources, and
share of manufacturing in exports. In developing countries it may also be
linked to indicators reflecting international cooperation and per capita
income.
(d) Targets: National targets for the share of manufacturing to GDP,
including the other industrial activities of the economy, are usually included
in policy making as a basis for budgets, funding programmes, and for priority-
setting exercises.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
Data on manufacturing value-added are presently compiled in accordance with
the UN International Standard Industrial Classification (ISIC) Revision 3.
It is derived as a percentage of the sum of total value added of all
production units including all taxes and subsidies on products which are not
included in the valuation of output. For the purpose of the indicator, it is
important that reporting uses a constant price time series. The indicator is
regarded as a measure of the State of the development of the economy.
Alternative indicators could focus on other major components of a country's
economy, such as the share of mining, natural resources, agriculture, or the
service sector to GDP.
5. Assessment of the Availability of Data from International and National
Sources
This indicator has no serious limitations because data on manufacturing
activities in the System of National Accounts (SNA) are guided by the
framework recommended in the ISIC, and are generally coherent between
countries. Furthermore, most information is regularly available and reliable
for the majority of countries.
Data on manufacturing value-added and GDP are generally reported by national
statistical offices or central banks to the UN National Accounts
questionnaire. These are supplemented by estimates prepared by the United
Nations Statistical Division (UNSD), as well as other international
organizations such as the World Bank and the International Monetary Fund
(IMF). These estimates are largely based on indicators of production of
principal manufacturing commodities obtained either from national sources or
the United Nations Industrial Development Organization (UNIDO). The latter
compiles country time series for both manufacturing value-added and GDP. When
using both UNSO and UNIDO data it is important to keep in mind the differences
in measurement concepts between data derived from national accounts and
industrial statistics.
6. Agencies involved in the development of the Indicator:
The lead agency for the development of this indicator is the United Nations
Industrial Development Organization (UNIDO). The contact point is the Chief,
Industrial Statistics Branch, Information and Research Division, UNIDO; fax
no. (43 1) 232 156. As the official compiler of national accounts statistics,
the United Nations Statistical Division could also be a principal contact
point in terms of SNA and ISIC references.
7. Further Information
Further details on the conceptual definition of GDP are contained in the SNA.
National account statistics are published in the series National Accounts
Statistics: Main Aggregates and Detailed Tables. The classification of
manufacturing industries is covered in the UN International Standard
Industrial Classification of All Economic Activities, Revision 3. Concepts
and definitions are in accordance with the international Recommendations for
Industrial Statistics, published by the United Nations.
LEAD AGENCY: DESIPA
SHARE OF CONSUMPTION OF RENEWABLE ENERGY RESOURCES
Category: Economic
1. Indicator
(a) Name: Share of consumption of renewable energy resources.
(b) Brief Definition: The consumption of renewable energy resources as a
ratio of total energy consumption.
(c) Unit of Measurement: %.
2. Placement in the Framework
(a) Agenda 21: Chapter 4: Changing Consumption Patterns.
(b) Type of Indicator: State.
3. Significance (Policy Relevance)
(a) Purpose: This indicator measures the proportion of energy mix between
renewable and non-renewable energy resources.
(b) Relevance to Sustainable/Unsustainable Development: Energy is a key
aspect of consumption and production. Dependence on non-renewable resources
can be regarded as unsustainable in the long term. New reserves of fossil
energy may be discovered, but economics may exclude their use. Renewable
resources, on the other hand, can supply energy continuously under sustainable
management practices. The ratio of non-renewable to renewable energy
resources represents a measure of a country's sustainability.
(c) Linkages to Other Indicators: Interpretation of this indicator is
enhanced when combined with annual energy production, annual energy
consumption per capita, and lifetime of proven energy reserves. It is also
closely linked to some of the environmental indicators such as greenhouse gas
emissions.
(d) Targets: Not available.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
The elements comprising this indicator are renewable resources, non-renewable
resources, and consumption. Renewable resources refers to "energy collected
from current ambient energy flows or from substances derived from them." This
definition includes energy derived from the combustion of biomass, which
refers to any plant matter used directly as fuel or converted into fuels or
electricity and/or heat (Energy Statistics Working Group, OECD 7-8 December
1993, Paris). Renewable energy sources are biofuels (fuelwood, charcoal,
bagasse, peat, industrial wastes and municipal wastes) and electricity
derived from solar power, wind power, wave power, hydro power, geothermal
aquifers, and nuclear power. Non-Renewable resources refers to fossil fuels:
solids, liquids and gases. Consumption refers to "apparent consumption",
derived from the formula "primary production + imports - exports - bunkers -
(+/-) stock changes."
This indicator is computed by calculating the ratio of consumption of a
renewable resource over total energy consumption. Generally, the use of
renewable energy resources is shown as not cost- effective; further, because
of the various forms of renewable and their uses, data collection is
difficult.
5. Assessment of the Availability of Data from International and National
Sources
Data on renewable and non-renewable resources are available from national
statistical offices and country publications.
6. Agencies Involved in the Development of the Indicator
(a) Lead Agency: The lead agency is the United Nations Department of
Economics and Social Information and Policy Analysis. The contact point is
the Director, Statistics Division, DESIPA; fax no. (1 212) 963 9851.
(b) Other Organizations: The agencies involved in the development of this
indicator are the World Energy Council (WEC), the International Energy Agency,
the Organisation for Economic Co-operation and Development (OECD), Eurostat,
and the Economic Commission for Europe.
7. Further Information
World Energy Council. Survey of Energy Resources. Annual Publication.
United Nations. Energy Statistics Yearbook.
LEAD AGENCY: DESIPA
NET RESOURCE TRANSFER/GROSS NATIONAL PRODUCT
Category: Economic
1. Indicator
(a) Name: Net resource transfer/Gross National Product (GNP).
(b) Brief Definition: The ratio of aggregate net resource transfers
(long-term) to GNP.
(c) Unit of Measurement: %.
2. Placement in the Framework
(a) Agenda 21: Chapter 33: Financial Resources and Mechanisms.
(b) Type of Indicator: Driving Force.
3. Significance (Policy Relevance)
(a) Purpose: The purpose of this indicator is to help assess the
availability of long-term external finance to a country. The ratio offers a
measure of the recourse to external finance in relation to the output of the
country.
(b) Relevance to Sustainable/Unsustainable Development: Financial
resources are obviously needed for the attainment of sustainable development.
Agenda 21 calls for the monitoring of the provision of financial resources,
particularly in developing countries, so that the international community can
take further action on the basis of accurate and reliable data. Recourse to
external finance can be to stimulate investment and growth, increase
consumption, or augment reserves to cushion against future shocks. Lack of
an adequate level of external finance can be a constraint to policy adjustment
and growth.
(c) Linkages to Other Indicators: This indicator is especially linked to
other economic indicators related to international cooperation, financial
resources, and consumption. Examples would include Gross Domestic Product per
capita and the World Bank ratio of Debt to GNP.
(d) Targets: Not available.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
Net resource transfers are net long-term resource flows less interest payments
on long-term loans and profit remittances on foreign direct investment. Net
long-term resource flows are defined as the sum of net resource flows on long-
term debt (excluding International Monetary Fund (IMF)), that is disbursements
less principal repayments, plus non-debt-creating flows. Non-debt creating
flows are net foreign direct investment, portfolio equity flows, and official
grants (excluding technical cooperation). Foreign direct investment is
defined as investment that is made to acquire a lasting management interest
(usually 10% of voting stock) in an enterprise operating in a country other
than that of the investor, the investor~s purpose being to have an effective
voice in the management of the enterprise. It is the sum of equity capital,
reinvestment earnings, other long-term capital, and short-term capital as
shown in the balance of payments. Portfolio equity flows are the sum of
country funds, depository receipts (American or global), and direct purchases
of shares by foreign investors. Grants are defined as legally binding
commitments that obligate a specific value of funds available for disbursement
for which there is no repayment requirement. Loan interest payments are the
amounts of interest paid by the borrower in foreign currency, goods, or
services. Profit remittances on foreign direct investment are the sum of
reinvested earnings on direct investment and other direct investment income.
Gross national product is an economic aggregate. It is the measure of the
total domestic and foreign output claimed by residents of an economy, less the
domestic output claimed by nonresidents.
5. Assessment of the Availability of Data from International and National
Sources
The principal sources of the information for long-term external debt are
reports from member countries to the World Bank through the Debtor Reporting
System (DRS). These countries have received either IBRD loans or IDA credits.
Reporting countries submit detailed loan-by-loan reports through the DRS on
the annual status, transactions, and terms of the long-term external debt of
public agencies and that of private ones guaranteed by a public agency in the
debtor country. Information on debt owed to multilateral institutions is
drawn from the files of these institutions. A total of 136 individual
countries report to the World Bank~s DRS.
Data on the use of IMF credit can be derived from the IMF~s Treasury
Department.
The short-term debt data is reported by the debtor country or derived from
estimates from creditor sources. The principal creditor sources are the
semiannual series of commercial banks~ claims on developing countries,
published by the Bank for International Settlements (BIS), and data on
officially guaranteed suppliers~ credits compiled by the Organisation for
Economic Cooperation and Development (OECD). For some countries, estimates
are prepared by pooling creditor and debtor information.
Data on non-debt creating flows is derived from several sources. Data on FDI
is from the IMF balance of payments, supplemented by detailed data on direct
investment from source and recipient countries. Data on portfolio equity
flows is obtained from market sources and national statistical offices or
securities exchanges, and that on grants from the OECD Development Assistance
Committee.
Data on GNP are from national statistical offices, complemented by World Bank
staff estimates.
6. Agencies Involved in the Development of the Indicator
The lead agency is the World Bank. The contact point is the Chief, Indicators
and Environmental Valuation Unit, Environment Department, the World Bank; fax
no. (1 202) 477 0968.
7. Further Information
Not available.
LEAD AGENCY: WORLD BANK
TOTAL OFFICIAL DEVELOPMENT ASSISTANCE GIVEN OR RECEIVED AS A
PERCENTAGE OF GROSS NATIONAL PRODUCT
Category: Economic
1. Indicator
(a) Name: Total Official Development Assistance (ODA) given or received
as a percentage of Gross National Product (GNP).
(b) Brief Definition: This indicator is defined as the total ODA given or
received as a share of GNP of the source or recipient country, respectively.
When ODA flows by donor countries are measured, ODA comprises bilateral
disbursements of concessional funds to developing countries and multilateral
institutions. When ODA receipts by developing countries are measured, ODA
comprises disbursement of concessional finance from both bilateral and
multilateral sources.
(c) Unit of Measurement: %.
2. Placement in the Framework
(a) Agenda 21: Chapter 33: Financial Resources and Mechanisms.
(b) Type of Indicator: State.
3. Significance (Policy Relevance)
(a) Purpose: The indicator is a measure of the size of flows that are
both concessional, and aimed mainly at promoting development and welfare of
developing countries. It conveys information about the borrower~s receipt of
aid from official lenders or official lender~s concessional flows to
developing countries.
(b) Relevance to Sustainable/Unsustainable Development: Financial
resources are obviously needed for the attainment of sustainable development.
Agenda 21 calls for the monitoring of the provision of financial resources,
particularly in developing countries, so that the international community can
take further action on the basis of accurate and reliable data.
(c) Linkages to Other Indicators: This indicator is particularly linked
with the other financial and international cooperation indicators.
(d) Targets: Not available.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
There are several ways of measuring ODA flows. The World Bank takes a
developing-country/debtor perspective and the Organisation for Economic Co-
operation and Development (OECD) takes a donor/creditor-country perspective.
ODA consists of grants or loans to developing countries that are undertaken
by the official sector with the purpose of promoting economic development and
welfare. Grants are defined as disbursements, in money or in kind, for which
there is no repayment required. ODA loans are provided at concessional
financial terms, that is with a grant element of 25 percent or more. The
degree of concessionality is determined by the terms of a loan - interest
rate, maturity, and grace period. The OECD includes grants for technical
cooperation, but the World Bank excludes them because these grants mostly
represent the provision of services rather than a flow of funds.
5. Assessment of the Availability of Data from International and National
Sources
The principal source of the information are the OECD and the World Bank~s
Debtor Reporting System. The OECD data are obtained from donor and creditor
sources through the information collected by the Development Assistance
Committee. It includes information from the Creditor Reporting System and the
joint OECD/Bank for International Settlements (BIS) system for identifying
officially guaranteed claims of private banks on developing countries.
6. Agencies Involved in the Development of the Indicator
(a) Lead Agency: The lead agency is the World Bank. The contact point is
the Chief, Indicators and Environmental Valuation Unit, Environment
Department, the World Bank; fax no. (1 202) 477 0968.
(b) Other Organizations: The OECD represents a contributing agency to the
development of this indicator.
7. Further Information
Not available.
LEAD AGENCY: WORLD BANK
DEBT/GROSS NATIONAL PRODUCT
Category: Economic
1. Indicator
(a) Name: Debt/gross national product (GNP).
(b) Brief Definition: The ratio of total external debt to gross national
product.
(c) Unit of Measurement: %.
2. Placement in the Framework
(a) Agenda 21: Chapter 33: Financial Resources and Mechanisms.
(b) Type of Indicator: State.
3. Significance (Policy Relevance)
(a) Purpose: Debt/GNP is a measure of the degree of indebtedness, and the
indicator helps to assess the external debt situation (and debt carrying
capacity) of a country.
(b) Relevance to Sustainable/Unsustainable Development: The ratio
measures the outstanding obligations in relation to the broadest measure of
the income-generating power of an economy. The higher the ratio, the greater
is the output that has to be forgone from sustainable development to service
the debt. A debt overhang exists when the debt stock exceeds that which could
reasonably be serviced by the debtor country in the medium or long-term.
There are no simple rules on what constitutes a reasonable burden, however,
and it will vary from country to country.
(c) Linkages to Other Indicators: This indicator, as a measure of
unsustainability, is closely linked to other financial and international
cooperation indicators. It also has general bearing on several of the social
and environmental indicators which show progress towards sustainable
development.
(d) Targets: Not available.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
Total external debt stock is defined as the sum of long-term external debt,
the use of International Monetary Fund (IMF) credit, and short-term external
debt. Long-term external debt is defined as debt that has an original or
extended maturity of more than one year, that is owed to non-residents, and
repayable in foreign currency, goods, or services. Long-term debt has three
components:
i) Public debt, which is an external obligation of a public debtor,
including the national government, a political subdivision (or an agency of
either), and autonomous public bodies;
ii) Publicly guaranteed debt, which is an external obligation of a private
debtor that is guaranteed for repayment by a public entity; and
iii) Private non-guaranteed debt, which is an external obligation of a
private debtor that is not guaranteed for repayment by a public entity.
Use of IMF credit denotes repurchase obligations to the IMF with respect to
all uses of IMF resources, excluding those resulting from drawings in the
reserve tranche. Use of IMF credits comprises purchases under the credit
tranches, including enlarged access resources and all special facilities (the
buffer stock, compensatory financing, extended fund, and oil facilities),
trust fund loans, and operations under the structural adjustment and enhanced
structural adjustment facilities.
Short-term external debt is defined as debt that has an original maturity of
one year or less. No distinction is made between public and private non-
guaranteed short-term debt. The World Debt Tables includes interest in
arrears (defined as interest payment due but not paid) on long-term debt, on
a cumulative basis, under short-term debt.
GNP is an economic aggregate. It is the measure of the total domestic and
foreign output claimed by residents of an economy, less the domestic output
claimed by nonresidents.
No one indicator can provide an exhaustive analysis of the debt situation of
a country. While this indicator is a measure of the extent of the debt
overhang of a country, it needs to be interpreted carefully. The nominal
stock of outstanding debt fails to take into account the differing
concessional terms of the external debt. This can give misleading indications
regarding the future debt servicing burden. One measure that takes into
account both the profile of debt servicing payments and the concessional
aspect of the debt is the present value of external debt. When the debt stock
of a country is mostly on non-concessional terms then the difference between
the present and nominal value are small. Another reason why this ratio can
be problematic is because of erratic changes arising from real exchange rate
movements.
5. Assessment of the Availability of Data from International and National
Sources
The principal sources of the information for the long-term external debt
indicator are reports from member countries to the World Bank through the
Debtor Reporting System (DRS). These countries have received either IBRD
loans or IDA credits. Reporting countries submit detailed loan-by-loan
reports through the DRS on the annual status, transactions, and terms of the
long-term external debt of public agencies, and that of private ones
guaranteed by a public agency in the debtor country. Information on debt owed
to multilateral institutions is drawn from the files of these institutions.
A total of 136 individual countries report to the World Bank~s DRS.
Data on the use of IMF credit can be derived from the IMF~s Treasury
Department.
The short-term debt data are as reported by the debtor country or as estimates
derived from creditor sources. The principal creditor sources are the
semiannual series of commercial banks~ claims on developing countries,
published by the Bank for International Settlements (BIS), and data on
officially guaranteed suppliers~ credits compiled by the Organisation for
Economic Co-operation and Development (OECD). For some countries, estimates
are prepared by pooling creditor and debtor information.
Data on non-debt creating flows are derived from several sources. Data on FDI
come from the IMF balance of payments, supplemented by detailed data on direct
investment from source and recipient countries. Data on portfolio equity
flows are obtained from market sources and national statistical offices or
securities exchanges, and that on grants from the OECD Development Assistance
Committee.
Data on GNP are from national statistical offices, complemented by World Bank
staff estimates.
6. Agencies Involved in the Development of the Indicator
The lead agency is the World Bank. The contact point is the Chief, Indicators
and Environmental Valuation Unit, Environment Department, the World Bank; fax
no. (1 202) 477 0968.
7. Further Information
Not available.
LEAD AGENCY: WORLD BANK
DEBT SERVICE/EXPORT
Category: Economic
1. Indicator
(a) Name: Debt service/export.
(b) Brief Definition: This indicator uses the ratio of total debt service
to exports of goods and services, including worker's remittances.
(c) Unit of Measurement: %.
2. Placement in the Framework
(a) Agenda 21: Chapter 33: Financial Resources and Mechanisms.
(b) Type of Indicator: State.
3. Significance (Policy Relevance)
(a) Purpose: The debt service ratio helps to assess the external debt-
servicing capacity of a country. It measures the cost of servicing debt in
terms of the foreign exchange earnings of the country.
(b) Relevance to Sustainable/Unsustainable Development: Debt can be an
inhibiting factor limiting economic growth, social development, and poverty
eradication. The debt service ratio can be a useful indicator of the current
debt servicing burden. It measures the current cash flow on debt servicing.
It does not measure the current cash flow requirement, which is defined as
the scheduled total debt service payments.
(c) Linkages to Other Indicators: This indicator, as a measure of
unsustainability, is closely linked to other financial and international
cooperation indicators. It also has general bearing on several of the social
and environmental indicators which show progress towards sustainable
development.
(d) Targets: Not available.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
Total debt service is debt service payments (not payments scheduled or due)
on total long-term debt. It includes both public and publicly guaranteed and
private non-guaranteed, use of International Monetary Fund (IMF) credit, and
interest on short-term debt. Exports of goods and services are the total
value of all goods and services, including workers~ remittances, sold to the
rest of the world.
The problem with using this indicator is that it can be meaningless if actual
payments are much smaller than scheduled payments, if export earnings are
volatile, or if the country is receiving a large level of grants, which also
provide foreign exchange. Like other debt indicators, it needs to be
interpreted carefully.
5. Assessment of the Availability of Data from International and National
Sources
The principal sources of the information for long-term external debt are
reports from member countries to the World Bank through the Debtor Reporting
System (DRS). These countries have received either IBRD loans or IDA credits.
Reporting countries submit detailed loan-by-loan reports through the DRS on
the annual status, transactions, and terms of the long-term external debt of
public agencies and that of private ones guaranteed by a public agency in the
debtor country. Information on debt owed to multilateral institutions is
drawn from the files of these institutions. A total of 136 individual
countries report to the World Bank~s DRS.
Data on the use of IMF credit can be derived from the IMF~s Treasury
Department.
The short-term debt data is reported by the debtor country or derived from
estimates from creditor sources. The principal creditor sources are the
semiannual series of commercial banks~ claims on developing countries,
published by the Bank for International Settlements (BIS), and data on
officially guaranteed suppliers~ credits compiled by the Organisation for
Economic Cooperation and Development (OECD). For some countries, estimates
are prepared by pooling creditor and debtor information.
Data on exports of goods and services (on a balance of payments basis) are
drawn mainly from the IMF, complemented by World Bank staff estimates.
6. Agencies Involved in the Development of the Indicator
The lead agency is the World Bank. The contact point is the Chief, Indicators
and Environmental Valuation Unit, Environment Department, the World Bank; fax
no. (1 202) 477 0968.
7. Further Information
Not available.
LEAD AGENCY: WORLD BANK
ENVIRONMENTAL PROTECTION EXPENDITURES AS A PERCENT OF GROSS
DOMESTIC PRODUCT
Category: Economic
1. Indicator
(a) Name: Environmental protection expenditures as a percent of Gross
Domestic Product (GDP).
(b) Brief Definition: Ratio of environmental protection expenditures over
GDP. Environmental protection expenditures are actual expenses incurred to
prevent, reduce, and eliminate pollution as well as any other degradation of
the environment.
(c) Unit of Measurement: %.
2. Placement in the Framework
(a) Agenda 21: Chapter 33: Financial Resources and Mechanisms.
(b) Type of Indicator: Response.
3. Significance (Policy Relevance)
(a) Purpose: This indicator measures the efforts undertaken by a country
to protect/restore the environment. Alternatively, it can be interpreted as
a measure of the economic cost imposed by a society to protect its
environment.
(b) Relevance to Sustainable/Unsustainable Development: This indicator is
one measure of the commitment of society to protect the environment. It
assumes that expenditures are necessary and interpretation may be difficult.
A low level of expenditure does not necessarily mean that a country is
degrading its environment. The indicator tends to emphasize clean-up costs
at the expense of lower cost, more effective protection measures.
Nevertheless, the indicator does provide an indication of government and
private sector response to protect the environment.
(c) Linkages to Other Indicators: This indicator is closely linked, for
example, with environmentally adjusted domestic product, GDP per capita, debt
to GDP, and expenditure on waste collection and disposal.
(d) Targets: International targets do not exist, however achievement of
national emission standards are indirectly related to environmental protection
expenditures.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
(a) Underlying Definitions and Concepts: Environmental protection
expenditures are defined in Chapter XXI of the System of National Accounts
(SNA), in the System of Integrated Environmental and Economic Accounting
(SEEA) (United Nations 1993), and in SERIEE (Eurostat 1994) as those expenses
which are an immediate response to effects caused by production and for which
environmental protection is the main objective. The Classification of
Environmental Protection Expenditures (CEPA) is contained in UNECE/CES/822
(1994).
(b) Measurement Methods: See section 4a above.
(c) The Indicator in the DSR Framework: The indicator is a Response
measure in the DSR Framework.
(d) Limitations of the Indicator: Environmental protection expenditures
are very difficult to measure because of the difficulty of determining whether
a new production process is adopted to prevent or reduce pollution or to
improve efficiency. Comparable data are not readily available, and may be
based on incomplete estimates. The total expenses for environmental protection
are not directly comparable GDP.
(e) Alternative Definitions: Alternative approaches have been suggested
such as the use of input-output analysis to assess the direct and indirect
contribution to GDP.
5. Assessment of the Availability of Data from International and National
Sources
(a) Data Needed to Compile the Indicator: Data on pollution control
expenditure; GDP.
(b) Data Availability: The data tend to be only available from developed
countries. At the international level institutions such as the Organisation
for Economic Co-operation and Development (OECD) complete surveys and collect
data from their members. The United Nations Statistical Division is carrying
out several country projects on the implementation of the SEEA. As part of
these projects, there is the segregation of environmental protection
expenditures.
(c) Data Sources: Data on environmental protection expenditures, mainly
for manufacturing, mining and electricity supply industries, can be obtained
from industrial statistics and by means of questionnaires to the industries.
Data on government environmental protection expenditures can be found in
financial statistics. Input-output analysis may be used for estimation
purposes.
6. Agencies Involved in the Development of the Indicator
The lead agency is the United Nations Department for Economic and Social
Information and Policy Analysis (DESIPA). The contact point is the Director,
Statistics Division, DESIPA; fax no. (1 212) 963 9851.
7. Further Information
DESIPA. 1993 System of National Accounts. Inter-secretariat Working Group
on National Accounts. 1993.
DESIPA. Integrated Environmental and Economic Accounting. United Nations.
1993.
Eurostat. European System for the Collection of Economic Information on the
Environment. 1994.
United Nations Economic Commission for Europe. Protection Facilities and
Expenditures. UNECE. 1994.
OECD. Pollution Abatement and Control Expenditures in OECD Countries.
Environment Monograph No. 75. 1993.
LEAD AGENCY: DESIPA
AMOUNT OF NEW OR ADDITIONAL FUNDING FOR SUSTAINABLE DEVELOPMENT
Category: Economic
1. Indicator
(a) Name: Amount of new or additional funding for sustainable development
given/received since 1992.
(b) Brief Definition:
i) Donor countries: Net external disbursements of bilateral official
development assistance, plus contributions and other official flows, to
multilateral institutions for sustainable development since 1992;
ii) Recipient countries: Net internal disbursements of bilateral official
development assistance, plus net disbursements by multilateral institutions
of Official Development Assistance (ODA) and loans on non-concessional terms
for sustainable development since 1992.
(c) Unit of Measurement: US$.
2. Placement in the Framework
(a) Agenda 21: Chapter 33: Financial Resources and Mechanisms.
(b) Type of Indicator: Response.
3. Significance (Policy Relevance)
(a) Purpose: This indicator signifies movement toward meeting the
incremental costs of implementing Agenda 21 and re-ordering priorities among
the social, economic, and environmental components of sustainable development.
(b) Relevance to Sustainable/Unsustainable Development: Indicates
relative success in establishing a donor-recipient partnership more conducive
to meeting sustainable development objectives, such as poverty reduction.
(c) Linkages to Other Indicators: The close linkages are primarily to
other financial resource indicators, such as ratio of net resources transfer
to Gross Domestic Product (GDP); total ODA given or received as a percentage
of GDP; ratio of debt to GDP; ratio of debt service to exports; and
environmental protection expenditure as a share of GDP.
(d) Targets: General targets include an increase of total funding over
1992 levels; and an appropriate balance among social, economic (general
development), and environmental components of sustainable development. At the
World Summit on Social Development (WSSD) approved the 20/20 commitment. This
commitment suggests that financial allocations to basic social services be
increased to 20% of the total government budget; and that 20% of ODA be
allocated to support these same services.
(e) International Conventions and Agreements: Agenda 21; WSSD.
4. Methodological Description and Underlying Definitions
(a) Underlying Definitions and Concepts: The inflow of resources to aid
recipient countries includes, in addition to ODA and other official flows,
official and private export credits and long- and short-term private
transactions. For purposes of this indicator, Funding refers only to
bilateral official development assistance plus all official development
finance channelled through multilateral institutions. Bilateral flows are
provided directly by a donor country to an aid recipient country.
Multilateral flows are channelled via an international organization, for
example, The World Bank, United Nations Development Programme (UNDP). Donors
should report contributions and other financial flows to international
organizations; recipients should report the outflows of multilateral agencies
to them.
Disbursement refers to the release of funds to, or the purchase of goods or
services for a recipient, by extension, the amount thus spent. Disbursements
record the actual international transfer of financial resources, or of goods
and services valued at the cost to the donor. In the case of activities
carried out in donor countries, such as training, administration or public
awareness programmes, disbursement is taken to have occurred when the funds
have been transferred to the service provider or the recipient. Disbursement
should be recorded as net, that is, the total amount disbursed over a given
accounting period less any repayments of loan principal during the same
period.
Official Development Assistance (ODA) comprises grants or loans to developing
countries and territories which are: i) undertaken by the official sector;
ii) with promotion of economic development and welfare as the main objective;
iii) at concessional financial terms (if a loan, at least 25% grant element).
In addition to financial flows, technical cooperation is included in aid.
Grants, loans and credits for military purposes are excluded. Official
Development Finance (ODF) includes grants and concessional and non-
concessional development lending by multilateral financial institutions. Net
disbursements should be for the purpose of funding sustainable development and
should be sub-divided into social development, economic (general) development
and environmental protection.
Sustainable development refers to funding for all development purposes as
defined by the Development Assistance Committee (DAC) of OECD except emergency
assistance (DAC purpose codes 430 000, 431 000, 431 100, and 431 300). Social
development refers to funding for health, welfare, education, and population
programmes (DAC purpose codes 35220, 38540, 91015, 91025, 91030, 91040, 91041,
91042, 91043. 91044, 91050, 91550, 93000, 93100, 93101, 93102, 93103, 93104,
93105, 93108, 93109, 93110, 93112, 93113, 93114, 93118, 93151, 93205, 93210,
93300, 93311, 93312, 93340, 93350, 93360, 93400, 93410, 93600, 94000, 94900
and 431200).
Environmental protection refers to funding for pollution control, waste
management and conservation (DAC purpose codes 92012, 92013, 92014, 92015,
92016, 92017, 92018, 92019, 92020, 92021, 92100, 92110, 92115, 92120, 92125,
and 92900). Economic development refers to funding for all other purposes.
(The above section has been adapted from Glossary of Key Terms and Concepts,
see section 7 below).
(b) Measurement Methods: For each of the four categories of financial
flows defined above, the base year level should be computed as the three-year
average for the years 1991, 1992, and 1993. Tables would then be prepared
showing the difference between the net flow in a given year (at base year
prices and exchange rates) and the figure for the base year.
(c) The Indicator in the DSR Framework: Changes in the levels and
composition of the categories of official development finance reflect an
important dimension of international cooperation. Thus, this represents a
Response indicator in the DSR Framework.
(d) Limitations of the Indicator: Comparable data may not be available
from non-DAC donor countries. Discrepancies may occur between figures
reported by donors and by recipients.
(e) Alternative Definitions: The relevance of the indicator would be
increased if the financial flows could be expressed as a percentage of the
targets expressed in section 3c above.
5. Assessment of the Availability of Data from International and National
Sources
(a) Data Needed to Compile the Indicator: Data on financial flows on all
projects from all donors classified according to DAC purpose codes.
(b) Data Availability: The data are available for DAC countries from the
DAC secretariat on request by a recipient country. They available for non-DAC
countries by a recipient government agency responsible for aid coordination.
(c) Data Sources: The DAC Secretariat and national aid coordination
agencies are the primary sources of data for this indicator.
6. Agencies Involved in the Development of the Indicator
The lead agency is the United Nations Department for Policy Coordination and
Sustainable Development (DPCSD). The contact point is the Director, Division
for Sustainable Development, Economics and Finance Branch, DPCSD; fax no. (1
212) 963 4260.
7. Further Information
OECD. Development Co-operation 1994: Efforts and Policies of the Members of
the Development Assistance Committee. See Glossary of Key Terms and Concepts,
p. 113-117.
OECD. The Creditor Reporting System Purpose Codes (DSD/DAC(95)8), 7 March
1995.
United Nations. The Declaration and Programme of Action of the World Summit
for Social Development. United Nations document ref. no. A/Conf.
166/L.3/Add.7, 10 March 1995.
LEAD AGENCY: DPCSD
CAPITAL GOODS IMPORTS
Category: Economic
1. Indicator
(a)Name: Capital goods imports.
(b)Brief Definition: Total value of capital goods imports.
(c)Unit of Measurement: $1 000US.
2. Placement in the Framework
(a) Agenda 21: Chapter 34: Transfer of Environmentally Sound Technology,
Cooperation and Capacity Building.
(b) Type of Indicator: Driving Force.
3. Significance (Policy Relevance)
(a) Purpose: The indicator is used to measure the transfer of embodied
technology.
(b) Relevance to Sustainable/Unsustainable Development: A rapid growth
of the indicator indicates fast growth of capital accumulation. This is
usually accompanied with high rates of replacement of equipment or the
adoption of newer technologies. On average, newer technologies are likely to
be more efficient and environment friendly. Thus, the indicator may be used
to measure the progression of production towards more sustainable patterns. It
could also be used to assess incentives given to investment.
(c) Linkages to Other Indicators: This indicator is linked to other
economic, environmental, and institutional measures including: investment
share in Gross Domestic Product (GDP), sum of exports and imports as a percent
of GDP, intensity of material use, amount of new or additional funding for
sustainable development, share of environmentally sound capital goods imports,
annual energy consumption per capita, emissions of greenhouse gases,
generation of industrial and municipal waste, waste recycling rate, generation
of hazardous waste, and sustainable development strategies.
(d) Targets: Not available.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
(a) Underlying Definitions and Concepts: The concept involved in the
definition of this indicator is available in the standard documentation on
trade statistics.
(b) Measurement Methods: The indicator can be derived from disaggregated
international trade statistic within section 7 of the Standard International
Trade Classification (SITC). One usually excludes consumer goods such as
domestic appliances (SITC 7194), television receivers (SITC 7241), radios and
broadcast receivers (SITC 7250), passenger motor cars and chassis (SITC 7321
and 7326), and motor cycles and bicycles (SITC 7329 and 7331).
(c) The Indicator in the DSR Framework: Within the DSR Framework, this
indicator is a positive Driving Force for sustainable development.
(d) Limitations of the Indicator: The relevance to sustainable
development is somewhat tenuous. However, data for its measurement are
available.
(e) Alternative Definitions: It would be desirable to measure the imports
of specific capital goods that are identified as environmentally sound. There
are, however, serious difficulties with the definition and, more importantly,
with the measurement of such an indicator since it is necessary first to
define the environmentally sound technologies, and second to disaggregate
trade statistics accordingly.
5. Assessment of the Availability of Data from International and National
Sources
(a) Data Needed to Compile the Indicator: Sufficiently disaggregated
trade statistics are required for this indicator.
(b) Data Availability: Disaggregated trade statistical series are
compiled for most countries. Furthermore, if data on a country's imports are
not available, partner data can be used, that is the exports by other
countries into the country in question. Since most capital goods originate
from developed countries, exports of those countries can be used as a
surrogate without incurring a large error.
(c) Data Sources: National and international trade statistics represent
the primary sources of data. Basic trade data is compiled by the Statistical
Division, United Nations Department for Economic and Social Information and
Policy Analysis.
6. Agencies Involved in the Development of the Indicator
The lead agency for the development of this indicator is the United Nations
Conference on Trade and Development (UNCTAD). The contact point is the
Coordinator, Sustainable Development, UNCTAD; fax no. (41 22) 907 0047.
7. Further Information
Not available.
LEAD AGENCY: UNCTAD
FOREIGN DIRECT INVESTMENTS
Category: Economic
1. Indicator
(a) Name: Foreign Direct Investments (FDI).
(b) Brief Definition: The value of net flows of foreign direct
investment.
(c) Unit of Measurement: $1 000US.
2. Placement in the Framework
(a) Agenda 21: Chapter 34: Transfer of Environmentally Sound Technology,
Cooperation and Capacity Building.
(b) Type of Indicator: Driving Force.
3. Significance (Policy Relevance)
(a) Purpose: The indicator is meant to represent the technology
transferred through the activities of foreign firms in a host country.
(b) Relevance to Sustainable/Unsustainable Development: New technologies
are usually environmentally sound and help protect the environment, are less
polluting, use resources such as energy efficiently, and recycle wastes. The
transfer of these new technologies provides opportunities for human resource
development, capacity building, and international cooperation. New and
efficient technologies are essential to increase the capabilities of
countries, in particular developing countries, to achieve sustainable
development through economic advancement, environmental protection and
conservation, and human development. This indicator also could be used to
assess the role of incentives or regulations in influencing investor behaviour
towards environmentally sound production.
(c) Linkages to Other Indicators: This indicator is linked to other
economic, environmental, and institutional measures, for example, import of
capital goods, investment share in Gross Domestic Product (GDP), sum of
exports and imports as a percent of GDP, intensity of material use, amount of
new or additional funding for sustainable development, annual energy
consumption per capita, emissions of greenhouse gases, generation of
industrial and municipal waste, waste recycling rate, generation of hazardous
waste, and sustainable development strategies.
(d) Targets: Not available.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
(a) Underlying Definitions and Concepts: The definition for this
indicator is derived from balance of payments statistics see section 7 below).
The concept supporting the indicator is available in standard documentation on
financial flows from the International Monetary Fund (IMF) and the United
Nations Conference on Trade and Development (UNCTAD).
(b) Measurement Methods: The indicator can be derived from balance of
payment statistics.
(c) The Indicator in the DSR Framework: The indicator is a Driving Force
measure in the DSR Framework.
(d) Limitations of the Indicator: As with capital goods imports, a more
meaningful indicator could be developed if disaggregated data existed for FDI.
(e) Alternative Definitions: The number of technology transfer agreements
in force within a country represents a simple alternative measure for this
indicator. However, comparable data are not widely available at this time for
such an indicator.
5. Assessment of the Availability of Data from International and National
Sources
(a) Data Needed to Compile the Indicator: Only general financial flow
statistics are needed to compile the indicator.
(b) Data Availability: Despite problems of definition, it is an indicator
for which comprehensive statistical series are available for international
comparisons.
(c) Data Sources: IMF and UNCTAD are the primary sources of data at the
international level.
6. Agencies Involved in the Development of the Indicator
The lead agency for the development of this indicator is the United Nations
Conference on Trade and Development (UNCTAD). The contact point is the
Coordinator, Sustainable Development, UNCTAD; fax no. (41 22) 907 0047.
7. Further Information
International Monetary Fund. Balance of Payments Handbook.
United Nations Conference on Trade and Development. Report UNCTAD/ITP/TEC/19.
LEAD AGENCY: UNCTAD
SHARE OF ENVIRONMENTALLY SOUND CAPITAL GOODS IMPORTS
Category: Economic
1. Indicator
(a) Name: Share of environmentally sound capital goods imports in total
capital goods imports.
(b) Brief Definition: The contribution of environmentally sound
technology in the transfer of embodied technology.
(c) Unit of Measurement: %.
2. Placement in the Framework
(a) Agenda 21: Chapter 34: Transfer of Environmentally Sound
technology, Cooperation and Capacity Building.
(b) Type of Indicator: State.
3. Significance (Policy Relevance)
(a) Purpose: The positive trend of the indicator can be used to measure
more accurately the move towards more sustainable technology transfer.
(b) Relevance to Sustainable/Unsustainable Development: Environmentally
sound technologies help protect the environment, are less polluting, use
resources such as energy efficiently, and recycle their wastes. The transfer
of these new technologies provides opportunities for human resource
development, capacity building, and international cooperation. New and
efficient technologies are essential to increase the capabilities of
countries, in particular developing countries, to achieve sustainable
development through economic advancement, environmental protection and
conservation, and human development. This indicator also could be used to
assess the role of incentives or regulations in influencing investor behaviour
towards environmentally sound production.
(c) Linkages to Other Indicators: This indicator is linked to other
economic, environmental, and institutional measures, for example, investment
share in Gross Domestic Product (GDP), sum of exports and imports as a percent
of GDP, intensity of material use, amount of new or additional funding for
sustainable development, annual energy consumption per capita, emissions of
greenhouse gases, generation of industrial and municipal waste, waste
recycling rate, generation of hazardous waste, and sustainable development
strategies.
(d) Targets: Not available.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
(a) Underlying Definitions and Concepts: The concept involved in the
definition of this indicator is available in standard documentation on trade
statistics. The definition of the indicator includes the following elements:
(i) value of total imports of machinery and equipment; and (ii) value of
imports of environmentally sound machinery and equipment.
There are serious difficulties in the definition of element (ii) above,
because trade statistics do not make a distinction between less and more
polluting versions of a process. It is possible to use as a proxy the imports
of add-on, disposal, or clean up equipment. In the latter case, the indicator
will be biased in the sense that, it will reflect the contribution to
sustainable development of pollution control technologies, but not that of
clean technologies. Further definition of the concept will be necessary before
it becomes fully operational.
(b) Measurement Methods: The indicator is measured by calculating
environmentally sound capital goods imports as a percentage of total capital
goods imports. The total imports can be derived from international trade
statistics within section 7 of the Standard International Trade Classification
(SITC). One usually excludes consumer goods such as domestic appliances (SITC
7194), television receivers (SITC 7241), radio and broadcast receivers (SITC
7250), passenger motor cars and chassis (SITC 7321 and 7326), and motor cycles
and bicycles (SITC 7329 and 7331). The difficulty with distinguishing
environmentally sound capital goods means the indicator faces serious
measurement difficulties in the immediate future (see section 4a above).
(c) The Indicator in the DSR Framework: The indicator shows the effort
being made to move towards more sustainable production. It is, therefore,
a State measure within the DSR Framework.
(d) Limitations of the Indicator: The indicator is not fully operational
at this time (see sections 4a and 4b above).
(e) Alternative Definitions: Not available.
5. Assessment of the Availability of Data from International and National
Sources
(a) Data Needed to Compile the Indicator: Sufficiently disaggregated trade
statistics are required for this indicator.
(b) Data Availability: Disaggregated trade statistical series are
compiled for most countries. Furthermore, if data on a country's imports are
not available, partner data can be used, that is the exports by other
countries into the country in question. Since most capital goods originate
from developed countries, exports of those countries can be used as a
surrogate without incurring a large error. As noted in section 4 above,
suitable data will probably not be available for imports of environmentally
sound capital goods.
(c) Data Sources: National and international trade statistics represent
the primary sources of data. Basic trade data is compiled by the Statistical
Division, United Nations Department for Economic and Social Information and
Policy Analysis.
6. Agencies Involved in the Development of the Indicator
The lead agency for the development of this indicator is the United Nations
Conference on Trade and Development (UNCTAD). The contact point is the
Coordinator, Sustainable Development, UNCTAD; fax no. (41 22) 907 0047.
7. Further Information
Not available.
LEAD AGENCY: UNCTAD
TECHNICAL COOPERATION GRANTS
Category: Economic
1. Indicator
(a) Name: Technical cooperation grants.
(b) Brief Definition: The value of technical cooperation grants.
(c) Unit of Measurement: $1 000US.
2. Placement in the Framework
(a) Agenda 21: Chapter 34: Transfer of Environmentally Sound Technology,
Cooperation and Capacity Building.
(b) Type of Indicator: Response.
3. Significance (Policy Relevance)
(a) Purpose: The indicator is meant to represent the technology
transferred through non-commercial sources.
(b) Relevance to Sustainable/Unsustainable Development: For the less and
least developed countries, technical cooperation grants represent a major
source of foreign technology. Such grants contribute to augmenting the level
of knowledge, skill and technical know-how, and productive aptitudes; and
increase the capacity for more effective use of the existing endowment. They
support, therefore, the more effective implementation of sustainable
development. In addition, this measure can be used to determine the
effectiveness of Official Development Assistance (ODA).
(c) Linkages to Other Indicators: This indicator is closely linked to
other economic measures, such as investment share in Gross Domestic Product
(GDP), amount of new and additional funding for sustainable development, and
total ODA given or received as a percentage of Gross National Product (GNP).
(d) Targets: Not available.
(e) International Conventions and Agreements: Not available.
4. Methodological Description and Underlying Definitions
(a) Underlying Definitions and Concepts: The concept is defined and
available in an Organisation for Economic Co-operation and Development (OECD)
document Geographical Distribution of Financial Flows to Developing Countries
(see section 7 below).
(b) Measurement Methods: The indicator can be obtained from the OECD data
series on geographical distribution of financial flows.
(c) The Indicator in the DSR Framework: This indicator is a Response
measure related to technology transfer.
(d) Limitations of the Indicator: It is not possible to quantify the
technology content of technical cooperation grants at the cross country level.
The data available concern total grants and therefore, it is not possible to
identify specific purposes of the technical cooperation such as training
fellowships, etc. The existence of such data, including objectives, would
allow the definition of a more precise indicator. Nevertheless, for many
developing countries grant flows are a major source of technology. It is,
therefore, important to consider this indicator as defined.
(e) Alternative Definitions: Not available.
5. Assessment of the Availability of Data from International and National
Sources
(a) Data Needed to Compile the Indicator: Data is required on the total
value of technical cooperation grants received by a country.
(b) Data Availability: There are comprehensive statistical series from
individual donor countries and multilateral agencies to individual developing
countries.
(c) Data Sources: The primary source of data at the international level
is the OECD.
6. Agencies Involved in the Development of the Indicator
(a) Lead Agency: The lead agency for the development of this indicator is
the United Nations Conference on Trade and Development (UNCTAD). The contact
point is the Coordinator, Sustainable Development, UNCTAD; fax no.
(41 22) 907 0047.
(b) Other Organizations: The OECD is the other international organization
key to the development of this indicator.
7. Further Information
OECD. Geographical Distribution of Financial Flows to Developing Countries.
Paris. 1988.
LEAD AGENCY: UNCTAD
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