A sustainable economy is one that is self-sufficient and lives depending on its own means; usually, it leaves not a liability but a legacy instead. In order to achieve it, humans should use natural resources that the environment can replenish without depleting them, whereas the pollution should be limited to a point that the environment can withstand without damaging its ongoing health and function.
There are several key steps to a sustainable economy that the world should embrace, in order to leave a legacy for future generations. The way we work daily and from one decade to another should let us live the joy of bigger forests, cleaner air, oceans and soils, healthier rivers and a better place than the one was left behind. Some of these steps include:
- Diversify economies. Numerous developing countries normally depend on few commodities leading to non-diversification. Without diversity, these countries are highly prone to shifts and price shocks in the cycles of investment. Countries should, therefore, broaden and restructure their revenue source via fiscal reforms. For instance, countries that depend on oil should break their dependence on it via introducing a plan of value-added tax.
- Stem the rise of inequalities. Rising inequalities threatens long term growth and also disrupts social cohesion progress on the sustainable development goals ( SDGs.) In order to have progress on global goals and sustainability of economic expansion, countries will have to raise living standards of the deprived persons and address inequality opportunities for long-term periods, thus the investments will not only increase longer-term potential but also growth.
- Enhance financial sustainability. Achieving universally agreed sustainable development goals is estimated to numerous trillion dollars each year. Private sectors could possibly chip in but the gap is too large to be covered by them only, therefore, a shift is needed in the way business is done. There is a need for the world to come up with a new financial architecture that will slowly shift these trillions from transactions that are short-term to long-term investments in machinery and equipment, healthcare, human capital, infrastructure and research and development.
- Improve institutions. Political instability and poor governance are fundamental obstacles to achieving sustainable development goals across the world. In the year 2017, capital began flowing into developing nations but this progress may not withstand time once trouble sets in. Developing countries should, therefore, improve their administrative capacities, business environments, and legal institutions.
Rising global temperatures across the world would possibly cause harm to civilization and ecosystems, but once new program outlines to guide business based decisions are made, eradication of the above indifference could be made. The main point is to measure how efficient financial inputs are transformed into environmental and social outputs.
Once you put all the above data together economic sustainability seems to be a bit difficult to achieve. The main reason as to why the present world solution strategies fail is because they do not solve the root causes entirely, but instead try to solve intermediate causes. If a principle is made to resolve root causes of the problem then economic sustainability pillar problem would become a forgotten case.