WE are now all familiar with the phrases connected with financial meltdown. How will the credit crunch, job losses and foreclosures in an unstable world economy affect green development?

How long the crisis will last is anyone?s guess at the moment. What is certain is that legislation on climate change issues is taking a backseat to reviving the world economy.

On the positive side

There are two sides to this question. On the positive side, some scientists think that the crisis will move people to use less energy and help limit carbon emissions. The global slowdown means people will have less money to buy. This translates into fewer products and goods being manufactured which means fewer natural resources used.

People in the United States are buying less fuel and building fewer houses. This means less building materials such as steel, glass and bricks?materials that are produced using electricity.

Since less fossil fuel is being used to run power plants, as well as produce and transport goods, there will also be less pollution.

The rate of deforestation will also be reduced as fewer trees will be cut down due to less consumption of wood and paper.

Some optimists project that the current situation may prompt countries to boost investment in efficiency and clean energy to tackle climate change. This move could result in more international cooperation.

Investing in energy efficiency during a recession and spending on renewable and other low-carbon industries also help stimulate the economy.

During economic crisis, more low-scale and down-to-earth projects are expected to be given more attention. Natural lighting, natural ventilation and passive cooling technology will be very cost effective.

Innovative and lightweight structural systems will reduce cost of building materials. Green and renewable energy sources will continue to be in vogue. Collection and recycling of water will prove to be very helpful. Reuse and recycling of materials cannot be overemphasized. Flexible space planning will be more and more adopted.

On the negative side

Pessimists argue that with the financial crisis, there will be less economic activity around the globe within the next few years. This could mean people putting the economy ahead of the environment, although until very recently, the environment got center stage in world attention.

With less money to spend on research for dealing with environmental concerns, important programs may be suspended indefinitely as donations are reduced or driven away from environmentally oriented institutions.

Ambitious plans that could be stopped or reduced in scope include investment in wind, solar and renewable energy, carbon trading, biodiesel refining and burying carbon dioxide from coal-fired power plants.

Before the crisis, people using public transportation increased, they left their cars at home and car pooling gained popularity, all for the sake of fuel conservation.

With the reduced price of oil today, due to the financial crisis, people may just decide to go back to using their cars. It could even dampen their initial enthusiasm to buy hybrid cars.

Another type of crisis

While the world is focused on the economy, there is another type of crisis that merits our attention.

According to a European Union-Commissioned Study, the global economy is losing more money from the disappearance of forests than through the current banking crisis. It estimates the annual cost of forest loss at between $2 and $5 trillion. This is much more than Wall Street?s earlier loss of about $1 to $1.5 trillion.

The report explains that as forests decline, nature stops providing services which it used to provide essentially for free. Consequently, we have to resort to building water reservoirs and facilities to sequester carbon dioxide, or farming foods that were once naturally available.

Where do we go from here?

The big challenge facing many investors now is where do we go from here?

Some sectors are saying that the shift would now be on renewable energy technologies or ET, the next global industry. It is expected to compete very closely with IT or information technology.

Experts are warning businesses that it would be a very big mistake to reduce investment in new technology during the downturn.

They say that we will eventually overcome this economic downturn and when that happens, those who continued to invest on renewable energy will emerge stronger and better equipped to face the environmental challenges of the future.

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