The UNCTAD Technology and Innovation Report 2023 calls for urgent action. Green technologies produce lower-carbon goods and services. They create a unique “Plinko effect.” Early adoption can lead to big gains and lasting benefits in related sectors. But, this opportunity is brief. Only those who act fast will reap the rewards of this wave of change.
Countries that miss the early stages of green tech will struggle to catch up later. To avoid that, national governments and the world must act soon.
Not being part of the green tech revolution would mean missing a fast-growing market.
Experts expect green frontier technologies to quadruple in value. By 2030, the frontier tech market could reach $9.5 trillion. Green tech exports alone could hit $2.1 trillion.
Green Tech Gap Between Countries
Green tech markets are growing at uneven rates around the world. This harms developing countries.
Unfortunately, developing countries are falling behind, not in trade but in readiness. They are for renewables and electric vehicles. Between 2018 and 2021, developing countries’ exports grew by 32%, from $57 billion to $75 billion. At the same time, developed economies’ exports more than doubled. They rose from $60 billion to $156 billion.
Only developed countries are well-prepared. They are rarely on the lists of top suppliers of frontier tech and patents. Except China.
Most top suppliers are from the US, a few other developed countries, and China. Also, China and the US dominate knowledge creation. They account for about 30% of global publications and almost 70% of patents.
This green tech gap is in UNCTAD’s Frontier Technology Readiness Index. It measures how well countries can use and adapt to new technologies. It uses indicators of ICT, skills, R&D, industrial capacity, and finance.
The 2023 ranking of 166 economies shows a risk to developing countries. Only developed countries prepare. The least ready are in Latin America, the Caribbean, and sub-Saharan Africa.
Developing Countries Can Catch Up
Some developing countries have achieved significant advances. From 2010 to 2020, bioenergy, solar, and wind power grew in middle- and low-income countries. These regions now make up over 50% of the total installed green tech capacity.
Many developing countries have great potential for renewable energy. They can gain more by adopting policies that support it and create jobs.
UNCTAD’s Technology and Innovation Report 2023 shows many examples of countries investing. Brazil, Chile, and Namibia are among them. They are developing green hydrogen.
The report’s cases of tech catch-up show the need for proactive government efforts. Policies should focus on clear goals and not fixing market problems.
Coordination is key in energy transition. It is a cross-cutting issue. It involves several government sectors. We must align environmental and industrial policies.
National governments should incentivize green sectors and innovation to diversify their economies. Move toward more complex products that are also greener.
International Cooperation is Critical
But developing countries cannot succeed alone. These countries need global support and a strong international framework to succeed.
Trade rules should not stop countries from protecting new green industries. These supports help industries grow big enough to compete in global markets.
IP rights rules should be flexible. They should ease upgrades in key green industries. The world must align trade and IP agreements with climate accords.
UNCTAD and the Innovation Report 2023 suggest new ways for the world to better support sustainable development.
These ideas include a global program to buy green products. They also include a team-based, open approach to green innovations. Another idea is a global fund. International organizations and donors would back it to promote green innovations.
