Waikato regional economic profile - Waikato Regional Council

The most commonly-used measure of economic progress, gross domestic product(GDP), does not take account of environmental losses or sources of wealth.Tremendous progress has been made in the last 20 years, however, in naturalresource accounting, and in developing good social indicators, time use surveys,environmental quality measures, and other means of assessing wellbeing,sustainability, and quality of life. This helped enable three California researchers todevelop a genuine progress indicator in 1995, incorporating 26 social, economic, andenvironmental variables.The genuine progress indicator nets the positive and negative results of economicgrowth to examine whether or not it has benefited people overall. The genuineprogress indicator is therefore a measure of wellbeing, sustainability and quality of life. 8The Wellington Regional Strategy uses a genuine progress indicator as a monitoringframework for assessing progress towards the well-being goals of the strategy. Thegenuine progress indicator is similar to the living standards framework being introducedby the Treasury to assess policy proposals. The framework takes into account how theflow of stocks of financial and physical, natural, social and human capital contribute toimproved living standards. WRC has committed to the development of a genuineprogress indicator for the region, but this work is not developed enough to inform thisprofile.A body of evidence indicates that a “green growth” approach is critical because theWaikato region’s economy is closely tied to the resources and waste assimilationservices provided by its environment and neither “business as usual” nor “more of thesame” is sustainable: Three of the region’s major industries (livestock and cropping farming, dairycattle farming and forestry and logging) occupy 83 per cent of the region’sproductive land. 9The most versatile soils in the Waikato region are found between Hamilton andCambridge, and around Matamata and Reporoa. However, some of our mostversatile soils are being used for urban development, particularly aroundHamilton and Cambridge (discussed in chapter 6.4).Water is already over-allocated in some catchments and the continued increasein demand for fresh water for irrigation and municipal uses is the main pressureon allocation of the region’s fresh water (discussed in chapter 6.6).There has been a net deterioration in river water quality across the region. Inmany cases the deterioration probably results from the widespread and intenseuse of land for pastoral farming. 10 It is predicted that increasing loads of nitrogen and phosphorus entering theWaikato River from larger and more intensively-used areas of farmland willincrease the risk of harmful algal blooms occurring over the next few decades. 11It is estimated that two thirds (66.3 per cent) of the total 36,546 terajoules ofenergy consumed by the Waikato regional economy to the year ending March2004 was consumed as fossil fuels. Road transport accounted for 15 per cent ofall energy consumed, almost all of which was from fossil fuels and dairy productmanufacturing consumed 10 per cent – predominantly from fossil fuels. 12 Thetransport and dairy sectors are therefore particularly vulnerable to both shorttermprice spikes and a long-term gradual decline in oil supply.8GPIAtlantic (2007) The GPI.9Market Economics Ltd (2006b, p. v).10Waikato Regional Council (2010, p. 82).11Waikato Regional Council (2010, p. 82).12Market Economics Ltd (2006b, p. 12).Doc # 2069885 Page 5