The Green Economy Mirage

Taiwan is attempting to implement the concept of a green economy through a Low Carbon Growth Plan (LCGP). However, the existing decision support tools for this measure have three key limitations: ignorance regarding the open economy; a lack of life cycle thinking; and limited categories of environmental impact. This study integrates environmentally extended, multi‐region input‐output analysis and hybrid life cycle assessment to quantify the potential environmental impact of the industrial activities and energy structure in Taiwan in 2020. Two novel indicators, environmental debts and loans, are also applied to identify the geographical shifting effects and tie environmental responsibility to the discussion. The results of this study reveal that under the existing LCGP, relative decoupling will be attained, but no significant environmental cobenefits other than those affecting climate change can be gained. Moreover, the current emission pledges cannot be fulfilled. The presence of increased environmental debt ratios reveals the geographical shifting effect of the LCGP. The main driver of the expansion of the environmental footprint can be attributed to the export of electronic components and products, which are not included in the agenda of policy discussions. As a result, three crucial policies are suggested to modify the existing LCGP: the implementation of a higher energy efficiency improvement target; rethinking the constraints on the electronics industry; and the development of a mechanism to include environmental issues in free trade agreement negotiations. With these changes, the realization of the current emission pledge and a green economy could be possible.