Analysis of the Resource Productivity of New Members of the European Union

Lembo Tanning; Toivo Tanning

doi:10.12691/jbe-3-1-3

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Analysis of the Resource Productivity of New Members of the European Union

Lembo Tanning^1,, Toivo Tanning²

¹TTK University of Applied Sciences, Tallinn, Estonia, EU

²Tallinn School of Economics, Tallinn, Estonia, EU

Abstract

1. Introduction

2. Methodology

3. Analysis of Resource Productivity

4. Conclusions

References

Abstract

Resources underpin the functioning of global economy and our quality of life. The objective of this article is to analyse the resource productivity, or material flow efficiency of new European Union (EU) states, with emphasis on Baltic countries, and to compare them on the EU level. All economic systems utilize a variety of resources. The scarcity of resources forces countries, companies and people make a variety of choices. How far is the use of these lands resource, including the 2009th economic crisis? The analysis showed that the greater use of resources does not always lead to economic growth. Effective use of resources is different from country to country. When sustainably new EU member states, but also the total use of resources? What are the lessons from the resource productivity? That's what we look at on the basis of the Baltic countries. The small are part of the former Soviet bloc countries. With regard to acute political and economic situation in is very topical, what is the position of small states in a resource productivity, or material flow efficiency.

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Keywords: resource productivity, resource efficient Europe, resource-sparing or resource saving, material flow efficiency, Baltic countries

Journal of Behavioural Economics, Finance, Entrepreneurship, Accounting and Transport, 2015 3 (1), pp 21-31.
DOI: 10.12691/jbe-3-1-3

Received October 30, 2014; Revised February 02, 2015; Accepted February 11, 2015

Cite this article:

Tanning, Lembo, and Toivo Tanning. "Analysis of the Resource Productivity of New Members of the European Union." Journal of Behavioural Economics, Finance, Entrepreneurship, Accounting and Transport 3.1 (2015): 21-31.

Tanning, L. , & Tanning, T. (2015). Analysis of the Resource Productivity of New Members of the European Union. Journal of Behavioural Economics, Finance, Entrepreneurship, Accounting and Transport, 3(1), 21-31.

Tanning, Lembo, and Toivo Tanning. "Analysis of the Resource Productivity of New Members of the European Union." Journal of Behavioural Economics, Finance, Entrepreneurship, Accounting and Transport 3, no. 1 (2015): 21-31.

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1. Introduction

Why is resource efficiency important? Natural resources underpin the functioning of the European and global economy and our quality of life. Our present use of resources in the future is not possible. Increasing resource efficiency will ensure economic and employment growth in . It will bring major economic opportunities, improve productivity, reduce costs and increase competitiveness. Resource-efficient Europe will provide a long-term framework for actions in many policy areas, supporting political agendas for climate change, energy, transport, industry, raw materials, agriculture and regional development. Resource efficiency strategy will support the transition to low-carbon economy to achieve sustainable growth. These resources include raw materials such as fuels, minerals and metals, but also food, soil, water, air, biomass and ecosystems. The pressure on the resources increases. Intensive use of the world's resources puts pressure on our planet and threatens the security of supply. Continuing our current patterns of resource use is not an option. In response to these changes, increasing resource efficiency will be key to securing growth and jobs for Europe. It will bring major economic opportunities, improve productivity, drive down costs and boost competitiveness. ^[1]

Based on projections the world population grow over 40 years while by 2510 million, an increase of 9,376 million people in 2050. ^[2] Growth occurs mainly in developing and emerging economies countries, where people aspire to wealth and consumption growth. Intensive use of world resources exerts pressure on our planet and threatens the security of supply.

A resource-efficient Europe is one of the main objectives of the Europe 2020 Strategy ^[3], which aims at guiding the effective use of resources to achieve sustainable economic growth. ^{[1, 3]}

In absolute terms (thousand tones) allows you to view an analysis of indicators corresponding changes in the country, the development of stability. ^{[4, 5]} In relative terms (here tonnes per capita) analysis allows you to compare countries with each other, however, the respective indices.

Material flow efficiency in new EU states, in eleven Central and East European countries (Bulgaria, Croatia, the Czech Republic, Estonia, Latvia, Lithuania, Hungary, Poland, Romania, Slovenia and Slovakia) has been analysed. It is CEE-8 and Baltic States. Former post-communist countries were selected for observation; new EU member states, Malta and Cyprus, have been excluded.

The history and economic background of his country's is more detail in previous earlier publications of authors. [4-15]^[4].

The theoretical foundations are given in more detail the works of other authors [16-21]^[16], in previous earlier publications of authors ^{[22, 23, 24, 25]} and of Eurostat ^[3].

2. Methodology

Resource productivity and resource intensity are key concepts used in sustainability metering as they attempt to decouple the direct connection between resource use and environmental deterioration. The leading indicator assigned to this policy initiative is termed resource productivity.

Resource productivity is GDP divided by domestic material consumption (DMC). DMC measures the total amount of materials directly used by an economy. It is defined as the annual quantity of raw materials extracted from the domestic territory of the focal economy, plus all physical imports minus all physical exports. It is important to note that the term "consumption" as used in DMC denotes apparent consumption and not final consumption. DMC does not include upstream flows related to imports and exports of raw materials and products originating outside of the focal economy. The trend in the development of resource productivity over time is presented as an index, with 2000 as the base year ^[26].

Resource productivity is the ratio of the volume of GDP in market prices over DMC ^[3].

Resource productivity is a measure of the output per unit of resource input ^[21].

Resource intensity is a measure of the resources (e.g. materials, energy and water) required for the provision of a unit of a good or service. It is usually expressed as a ratio of materials used to value (expressed, for example, in money, mass, volume). Resource intensity is determined by two factors: changes in the mix of materials used to produce individual goods and services, and the product composition of output. ^[21]

Resource productivity and resource intensity are essential concepts for measuring the progress of dematerialisation and other efficiency-led strategies. ^[21]

The indicator DMC is defined as the total amount of material directly used in an economy. DMC equals Direct Material Input (DMI) minus exports. DMI measures the direct input of materials for the use in the economy. DMI equals Domestic Extraction (DE) plus imports ^[27]

Domestic material consumption by material of Eurostat is in environmental accounts ^[28].

Material flow accounts data description: material flow accounts and resource productivity ^[29].

Economy-wide material flow accounts (EW-MFA) compile material flow inputs into national economies. EW-MFA cover all solid, gaseous, and liquid material inputs, except for water and air, measured in mass units per year. Like the system of national accounts, EW-MFA constitute a multi-purpose information system. The detailed material flows provide a rich empirical database for numerous analytical purposes. Further, EW-MFA are used to derive various material flow indicators such as:

Domestic extraction (DEU): total amount of material extracted for further processing in the economy, by resident units from the natural environment;

Imports (IMP): imports of products in their simple mass weight;

Direct material input (DMI): measures the direct input of material into the economy; it includes all materials which are of economic value and which are availble for use in production and consumption activities (=DEU+IMP);

Exports (EXP): exports of products in their simple mass weight;

Domestic material consumption (DMC): measures the total amount of material actually consumed domestically by resident units (=DEU+IMP-EXP). Note: IMP and EXP are distinguished into extra-EU-trade and total trade.

Resource productivity (GDP/DMC) is defined as the ratio of GDP over DMC and commonly expressed in Euro per kilogramm material. The data set env_ac_rp employs different types of GDP for calculating this ratio - depending on the analytical perspective:

GDP in current prices over DMC (unit = 'Euro per Kilogram'): to be used to analyse a single country at one point in time (for one particular year);

GDP in chain linked volumes over DMC (unit = 'Euro per kilogram, chain linked volumes (2005)'): eliminates price inflation over time; to be used when comparing over time (various years) one single country;

GDP in purchasing power standard (unit = 'Purchasing Power Standard per Kilopgram'): eliminates differences in price levels across countries; to be used when comparing across countries at one point in time (for one particular year).

In order to compare the performance over time and across various countries the second resource productivity ratio employing GDP in chain-linked volumes has been indexed to the year 2000 (unit = 'Index, 2000=100'). This index allows a comparison of countries' resource productivity performance ^[29].

This can be expressed in monetary terms, as monetary return per unit of resource. Here in tonnes per capita.

Material resources are divided: biomass (MF1), metal ores (gross ores) (MF2), non-metallic minerals (MF3), fossil energy materials/carriers (MF4), other products (MF5) and waste for final treatment and disposal (MF6). Here we look also subgroups of MF4: liquid and gaseous energy materials/carriers (MF42); crude oil, condensate and natural gas liquids [NGL] (MF421) and natural gas (MF422) ^{[30, 31]}.

In summary, the main indicators are: Domestic Extraction Used (DEU). Domestic Material Consumption (DMC). Exports (EXP). Imports (IMP). Direct Material Inputs (DMI).

(1)

(2)

^[7]

National accounts (including GDP) was from Eurostat methodology. ^[32]

3. Analysis of Resource Productivity

Next we analized resource productivity, or material flow efficiency of new European Union (EU) states, with emphasis on Baltic countries; and to compare them on the EU level.

3.1. Material Flow Analyses by DMC per Capita

Table 1. Res Prod GDP and DMC 2012 [30]

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Analysis of the Resource Productivity of New Members of the European Union

Science and Education Publishing

Analysis of the Resource Productivity of New Members of the European Union

Abstract

At a glance: Figures

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Cite this article:

1. Introduction

2. Methodology

3. Analysis of Resource Productivity

Table 1. Res Prod GDP and DMC 2012 [30]

Table 2. Resource productivity. Index, 2000=100 [26]

Table 3. Resource productivity. Euro per kilogram, chain linked volumes (2005) [26]

Table 4. Domestic material consumption, tonnes per capita [31]

Table 5. Total exports resource, tonnes per capita [31]

Table 6. Total imports resource, tonnes per capita [31]

Table 7. Total extra EU27 imports resource, tonnes per capita [31]

Table 8. Total direct material inputs resource, tonnes per capita [31]

Table 9. Total domestic extraction used resource, tonnes per capita [30]

Table 10. Total resource of Estonia, tonnes per capita [30]

Table 11. Domestic material consumption of fossil energy materials/carriers tonnes per capita of CEE-8 countries was greatest in Czech Rep. and Bulgaria [31]

Table 12. Domestic material consumption of fossil energy materials/carriers tonnes per capita of EU-27 and Baltic countries [31]

Table 13. Domestic extraction used of fossil energy materials tonnes per capita of CEE-8 countries [31]

Table 14. Domestic extraction used of fossil energy materials tonnes per capita of EU-27 and Baltic countries [31]

Table 15. Direct material inputs of fossil energy materials tonnes per capita of CEE-8 countries [31]

Table 16. Direct material inputs of fossil energy materials tonnes per capita of EU-27 and Baltic countries [31]

Table 17. Total imports of fossil energy materials tonnes per capita of CEE-8 countries [31]

Table 18. Total imports of fossil energy materials tonnes per capita of EU-27 and Baltic countries [31]

Table 19. Extra EU-27 imports of fossil energy materials tonnes per capita of CEE-8 countries [31]

Table 20. Extra EU-27 imports of fossil energy materials tonnes per capita of EU-27 and Baltic countries [31]

Table 21. Total exports of fossil energy materials tonnes per capita of CEE-8 countries [31]

Table 22. Total exports of fossil energy materials tonnes per capita of EU-27 and Baltic countries [31]

Table 23. Extra EU-27 exports of fossil energy materials tonnes per capita of CEE-8 countries [31]

Table 24. Extra EU-27 exports of fossil energy materials tonnes per capita of EU-27 and Baltic countries [31]

Table 25. Domestic material consumption of crude oil, condensate and natural gas liquids (NGL) tonnes per capita of EU-27 and Baltic countries [31]

Table 26. Total imports of crude oil, condensate and natural gas liquids (NGL) tonnes per capita of EU-27, Germany and Baltic countries [31]

Table 27. Extra EU-27 imports of crude oil, condensate and natural gas liquids (NGL) (MF421) tonnes per capita of EU-27, Germany and Baltic countries [31]

Table 28. Extra EU-27 imports of crude oil, condensate and natural gas liquids (NGL) (MF421) tonnes per capita of EU-27, Germany and Baltic countries [31]

Table 29. Domestic material consumption, total imports and extra EU-27 imports of natural gas tonnes per capita, top-6, 2012 [31]

Table 30. Total imports and extra EU-27 imports of natural gas tonnes per capita of EU-27 [31]

Table 31. DMC, total imports and extra EU-27 imports of natural gas tonnes per capita of Germany [31]

Table 32. DMC, total imports and extra EU-27 imports of natural gas tonnes per capita of Baltic countries [31]

Table 33. Total extra EU-27 imports liquid and gaseous energy materials (MF42) tonnes per capita of EU-27, and Baltic countries [31]

Table 34. Extra EU-27 imports natural gas (MF422) tonnes per capita of Baltic countries [31]

4. Conclusions

References

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