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Research Article | Volume 4 Issue 1 (March, 2024) | Pages 1 - 8
Towards a Green Economy: Technological Change Challenges for Sustainability
Economic Department, College of Administration and Economics, University of Baghdad, Iraq, 10071
Faculty of Administration and economics, Kerbala University, Iraq, 56001
Under a Creative Commons license
Open Access
Jan. 12, 2024
Jan. 18, 2024
Feb. 12, 2024
March 30, 2024

The Iraqi economy is very interesting with the concept of a sustainable green economy because of its role in improving the environment, climate, culture and improving the standard of living of the individual and society. This interest has been reflected through the international and local research, studies, facilities, and methods of encouragement for clean environment, natural agriculture, and pollution-reduced lifestyles, through investment in buildings, transportation, tourism, energy, clean technology, and innovation. However, this economic, societal and cultural method faces several public and private challenges related to the nature of the Iraqi society and economy, some of these challenges are the method of production and support for green investment, environmental protection, environmental regulations and laws, and the priority of applying the green economy in the government program. This research explains on these challenges and tries to find solutions to them by focusing on the importance of the green economy in improving the standard of living, the environment and the climate.

Sustainable development
Green economy
Iraqi economy
Technological change.

The concept of sustainable development has gone through several stages, and after practical practices to try to embody this concept, it became clear that it is one of the most difficult concepts to apply, and that its implementation on the ground will only be within the framework of a new economic approach known as the green economy approach. The need for a green economy and green growth emerged as a measure to stimulate national economies Following the global financial crisis, the International Monetary Fund, the World Bank, some regional development banks and the Organization for Economic Co-operation and Development (OECD) launched new programs to study the possibility of adopting the green economy approach at the macro and micro levels 



The overarching purpose of this study is to provide policymakers and professionals with a better understanding of the difficulties inherent in achieving sustainable technological progress. We also discuss the limitations of applying research into the future to the Iraqi economy and provide suggestions for overcoming such problems. Therefore, the study focused on a number of dimensions:

1- Dealing with widespread environmental risks - and more global risks than before.

2- Achieving a radical, not just increasing, sustainable technological change.

3- Green capitalism and the state's role in designing an appropriate mix of policies to deal with new changes.


4- Challenges facing the application of the green economy in the midst of the changes facing the Iraqi economy.


2. The concept of green economy and sustainability

The green economy is defined as:

It is described as "that economy that results in enhancement of human well-being and social equality while considerably lowering environmental dangers and ecological scarcity of resources" [1] by the United Nations Environment Program. The term "green economy" may be simplified as follows: an economy that prioritizes conservation of natural resources, uses less of them, and is accessible to people of all ages.


The green economy can also be defined as one of the reasons that lead to the development and growth of humankind, and society will become equitable in the distribution of resources, and achieving it will significantly reduce risks and environmental scarcity.


Sustainability [2] is a concept given to the diverse biological environment, living organisms, and natural factors that maintain their existence for the longest possible period of time. Preserving the continuity of life may also be seen as a component of sustainability, which is described as "maintaining the quality of life through adapting to the environment by using natural resources over the longest possible length of time." The term "sustainability" may also be understood as referring to the interrelated mechanisms that ensure the survival of different species throughout time, allowing them to reproduce and pass on their genes.


3.  Transition and transition to a green economy

Repeated failures and several crises in the global economy inspired the idea of transitioning to a green economy (the collapse of markets, financial and economic crises, high food prices, climate fluctuations, the rapid decline in natural resources and the speed of environmental change). The following are three [3] of the incentives offered to encourage the transition to a green economy:


1- Focusing on rural development with the goal of eliminating rural poverty; this is because the green economy helps alleviate poverty by wisely managing natural resources and ecosystems, which allows us to reap the advantages of natural capital and provide them to the poor.


2 - Keeping an eye on water, making an effort to not pollute it, and trying to make sense of it: Saving groundwater in wells and surface water via conservation measures are both possible outcomes of enhancing water efficiency and utilization.


Reducing energy subsidies in the Arab area by 25% would save more than $100 billion within three years, money that may be used toward greening energy, transitioning to it in the transportation industry, and ultimately greening fifty percent of the transportation sector. High energy efficiency and the usage of public transportation and hybrid automobiles result in yearly savings of around $23 billion in Arab nations, and investing $100 billion over the next decade to "green" 20% of existing buildings is projected to create more than 4 million new jobs.


Four, trying to recycle solid waste and solve the problem: More than half of these wastes are disposed of improperly by being dumped into the water or being released into the air as a result of the production of phosphorous acid and fertilizers, the production of concentrated minerals, and the concentrated use of fertilizers in agriculture, industrial and traditional tanneries, and the pharmaceutical and manufacturing industries.


As part of the investment plan in which two percent of GDP is invested in the most important economic sectors, we must work to increase sustainable investments in the field of energy and measures to raise energy efficiency in those places where this transition will result in a significant reduction in greenhouse gas emissions. More than half of this funding is allocated by green to improve energy efficiency, raise output, and make use of renewable energy sources; this leads to a 36% decrease in energy intensity worldwide.


4.  Sustainable technical innovation and the shift to a green economy

Over the last several years, there has been a recurring theme that suggests conventional economic models require updating if we are going to successfully combat climate change, biodiversity loss, water shortages, etc., and other similarly massive social and economic concerns. This discussion [3] was sparked by the 2008-2009 financial crisis, and the resulting worries have become the "green economy" concept. In addition, the so-called 2030 Agenda for Sustainable Development and its 17 Sustainable Development Goals were approved by governments throughout the globe in 2015. These targets acknowledge that eradicating global poverty necessitates not only strategies to boost economic growth, but also to meet a variety of social needs like those related to education, health, social protection, and the creation of jobs, all while addressing environmental pollution and climate change.


By doing so, the SDGs cement the ecological and economic systems' mutual dependency. They also highlight the need of making the switch to a green economy, which involves adopting more environmentally friendly methods of production and consumption.


In this study, we zero in on one crucial facet of such a shift: the creation of environmentally friendly modes of production and consumption that do not ruin the planet's ecosystems and climate. More specifically, this study tackles a number of critical issues in promoting and removing obstacles to long-term technological development.


Natural science knowledge and engineering competence in understanding the different technological solutions that might be employed to lessen effects are both necessary for tackling climate and environmental problems. Negative (such as zero-carbon energy technologies) (such as zero-carbon energy technologies)


There are several obstacles that are not technical in nature that must be overcome in the quest for long-term technological transformation. So-called transition literature, for instance, acknowledges that several industries, including electricity production, water delivery, etc., may be seen as socio-technical and/or innovation systems [4]. Networks of people (individuals, businesses, universities, governments, etc.), the information they hold, and the organizations to which they belong make up these systems (legal rules, codes of conduct, etc.).


In other words, creating new value chains that host actors who did not necessarily interact in the past can be an important step in developing carbon-neutral technologies; this is a lengthy process that can affect societal shifts in a variety of ways, including legislative changes, shifts in consumer behavior, distributional effects, infrastructure building, and novel business models.


Sustainable technical transformation can only be achieved with accompanying economic and social adaptation. Indeed, there are several instances throughout history that demonstrate the need of addressing the institutional and organizational difficulties that accompany technical advancements. The electrification of society throughout the twentieth century has huge socioeconomic implications in terms of productivity improvements. Nonetheless, despite the fact that electric power was found in the late 1870s, at the turn of the century, fewer than 5% of mechanical energy in American manufacturers was provided by electric motors, and it took another 20 years before their productivity soared  [5].


To fully take advantage of the new technology, existing companies had to overhaul their whole operating systems, including the manufacturing process, architecture, logistics, and the hiring, training, and compensation of their employees. This slowed the spread of electric power.


Many businesses have been pouring money into computers for years without seeing any return. However, similar to other instances of new technology, this one needs organizational changes before businesses could reap the benefits of the computer.


Decentralizing, outsourcing, and streamlining supply chains, and providing customers with more options, are all part of this strategy [6].


To that end, there has been a rise in governmental and scholarly interest in the topic of how to foster technological development in a way that is both sustainable and progressive. The primary goal of this study is to have a conversation about some of the most significant social issues associated with making such a shift, and to come up with essential recommendations for policymakers and crucial pathways for further study.


For this purpose, we consult a wide range of scholarly works. Three overarching difficulties [7] are highlighted in the article:

• Addressing widespread and growing environmental hazards.

• Making significant, long-lasting advances in technology, rather than merely little ones.

• The unsteady business as usual situation brought on by the rise of green capitalism.


The first two difficulties are on the many structural tasks needed to pursue sustainable technological progress and the obstacles that must be overcome in order to succeed.


The final element is related to duty and accountability. Additional difficulties are listed and described under each of these three main categories. We also present suggestions for addressing and managing these issues, while the precise approaches will likely differ from one country or area to another. At the end of the article, we briefly discuss several important directions for future study, with an emphasis on studies that will facilitate a transition to green social and technological practices.


5. New variables and the mechanism of dealing with their risks

Strict limits on air and water emissions were introduced with the onset of contemporary environmental policy in the 1960s. However, almost all of the attention was paid to relatively easy-to-control sources of pollution, such as factories, since they were located in fixed locations. In addition, there was an early emphasis on the consequences of local environmental factors, such as emissions in adjacent river basins, on neighboring companies and the local population.


It is imperative that society develops indirect, but effective, methods of monitoring and regulating these ubiquitous environmental consequences. This can mean putting more emphasis on reducing, recycling, and reusing raw materials [7], as well as material and energy efficiency, and sharing resources; or it can mean trying to promote a circular economy, in which the value of products, materials, and resources is preserved for as long as possible. That is to say, rather than regulating emissions as near to the harm as possible, authorities may instead back certain activities (like recycling of materials) and/or technology (like low-carbon industrial methods) that may be expected to reduce emissions in the first place. It is linked to lighter impacts on the planet. The third step of the preceding stage commences while the tunnel processing is still ongoing.


Promoting product designs that improve repairability and reuse is a crucial step toward increasing recycling and reusing rates. The modular design of a product may also help with recycling. Unfortunately, there are difficulties associated with this. Many items are designed in a manner that makes recycling more expensive for subsequent treatments, yet a waste recovery plant may be unable to provide financial incentives to the producer to modify the design. Multilayer plastics used in food packaging, for instance, are often not suitable for mechanical recycling [5].


As a result, indirect techniques to minimize pollution are more necessary for environmental protection as the spread of pollutants in the natural environment becomes increasingly important. Each of these approaches (such as encouraging recycling and material efficiency) comes with its own set of difficulties, including substantial hurdles (such as product design or the utilization of by-products) and potentially undesirable side effects (eg, rebound effects). The need to strengthen incentives for product design and enhance the traceability and traceability of hazardous materials and materials should not be lost sight of in the midst of the current emphasis on recycling and resource efficiency. New approaches are required, both technologically and organizationally [4].


6.The mechanism of technological change that is permanently sustainable

The shift to a green economy relies on a number of factors, including increased innovation and the optimization of existing manufacturing processes to reduce material and energy waste. However, there is also a need for more radical technical innovation, such as the replacement of fossil fuels in the transportation sector and in iron and steel manufacturing, which requires fundamental technological breakthroughs and not simply incremental increases in efficiency. On the other hand, there are a few obstacles that will make new ideas hard to implement. There are primarily three hurdles to overcome [8]


First, the financial market's insufficient capacity to cope with the problem of long-term risk, along with the risks enterprises face while investing in technological advancement (funding fundamental research and development, pilot testing, etc.). Due to a lack of historically sequenced data for risk assessment, these marketplaces may be unable to supply risk management tools for developing technologies. Concerns have also been raised that private financial investors may be adopting a more short-term approach due to the deregulation of global financial markets.


Secondly, private investors are generally not incentivized to undertake long-term technical development investments. A dearth of public goods, such as the insights gained through scientific study and hands-on experience, has hazards that have been highlighted in economics texts. Since large advantages will also accrue to other enterprises, private corporations may dedicate just a percentage of the entire rate of return on this investment (through reverse engineering). Investments in long-term technical progress will become inefficient and small due to the cognitive repercussions.


Thirdly, there is frequently unjust rivalry between different green technologies. Because they were able to grow during times of less rigorous environmental legislation as well as institutions and infrastructures, incumbents will have a comparative advantage over their greener rivals, even if the two may be near substitutes. As a result, the economy becomes too dependent on a small number of technical trends [6]. Technology decisions tend to be especially self-reinforcing if the investments are characterized by high upfront costs and higher returns through adoption. In general, businesses leverage the acquired knowledge of technology when designing new goods and processes (such as scale, learning and network economics). Path dependence may also be exacerbated by pre-existing institutions like laws, norms of behavior, etc., which tend to prioritize the status quo.


All private sector long-term technical growth is hindered by the aforementioned three issues, but there is reason to assume that green technology development is especially hampered by them. To begin with, empirical evidence suggests that green technologies (in energy and transportation) have considerable cognitive repercussions compared to the dirtier technologies they replace. While safeguarding property rights is one strategy for mitigating such secondary effects, the patent system has its limits.


The implementation of new systemic structures (i.e. networks of players, value chains, knowledge, and institutions) that are in accordance with developing technologies is time-consuming and fraught with risk, but is necessary for achieving technological transition for sustainability. Simply put, the private sector cannot be relied on to build such infrastructure without some kind of public backing.

Any policy instrument or combination of policies, however, can only be useful if it is based on a solid understanding of the underlying challenges to sustained technological advancement. Since many technologies have their own unique challenges in terms of learning curves, patent chances, risk profiles, etc., technology-specific aid may be necessary.


7. The emergence of green capitalism and the mechanism of uncertain work

Economic and environmental objectives have been considered as mutually incompatible at the very least since the current environmental debate began in the 1960s. According to conventional wisdom, businesses make choices based on the need to maximize profits, thus any efforts to do so while also addressing environmental problems would have a negative impact on both [9]


Concerns about the environmental impacts of the global economy, the proliferation of organic goods and labels, waste material recycling, climate compensation programs, etc., are all contributing to the mainstreaming of sustainability problems in the corporate world. In reality, today's most successful corporations often make no distinction between environmental innovation and other forms of innovation; environmental impacts from daily operations are routinely included into new product development.


To put it in Schumpeterian words, some have argued that long-term technology transformation entails "a fresh wave of creative destruction" that has the potential to drastically reshape the competitive landscape across many sectors. It has been acknowledged in the literature that sustainability-focused entrepreneurs may play a significant role in facilitating the shift to a green economy by fusing conventional commercial strategies with sustainable development projects.


That is, there is a rising need for businesses that can operate inside what were earlier considered to be mutually exclusive logics (commercial and environmental). In this area, however, green capitalism faces significant criticism. Furthermore, the answer to the issue of how far the market-driven sustainability transformation will lead us is likely to differ between company sectors and variables like the accessibility of funding.


All of this points to the fact that businesses may not be able to sustainably invest in green technology's future growth if they are not given direct regulatory backing. Many of the world's most successful business people in the field of sustainability have taken advantage of the fact that they can charge more for their products because they are environmentally friendly. However, developing new environmentally friendly processes is harder. Getting customers to pay a premium for these advances is challenging. For instance, contemporary iron and steel mills need to make significant efforts to create a carbon-free blast furnace process [10]


Even if this goal is reached, it is still not obvious whether people will be prepared to pay more for cars because of the fact that they are made in a way that is less harmful to the environment. Moreover, crossing "Death Valley" to apply fundamental R&D discoveries that seem promising in the lab to commercial application is a lengthy and dangerous process. Improvements and expansions in production methods are often necessary for implementing new processes. Particularly challenging for smaller and medium-sized enterprises.


When it comes to making the shift to a green economy, only green capitalism and sustainable entrepreneurship are likely to run into any significant roadblocks [10]


First, the business and fundamental change may contain relatively few significant technology revolutions due to the long-term repercussions of knowledge and the need to take risks.


Second, the potential for higher material and energy efficiency is considerably enhanced by the likelihood of extensive digitalization and automation under the baseline scenario. Rebound effects mean that efficiency improvements from new technology may not be enough to solve the sustainability problem by itself.


8. Challenges of transformation and transition to a green economy:

Countries, like Iraq, will confront numerous obstacles on the path to clean (green) energy, but they 

must increase their efforts to overcome these obstacles.

Here are some examples [6] of such difficulties:

One, the sector of development policies has not been well planned.

The spread of the problem of unemployment among a large group in society, especially among the youth group, as a result of the shift of jobs from one sector to another, as the increase in jobs in certain sectors is offset by the decline in a number of jobs in other sectors, especially in the transitional phase.


Three, the potential for new trade barriers, including protectionist policies and technological obstacles, to arise.

More than 45 million Arabs lack access to basic health care and clean water, and inefficient use of renewable resources means that roughly 70 million people in the Arab globe continue to live in poverty.


5. The cost of transitioning to a green economy may outweigh the benefits in terms of other development objectives, and there is no guarantee that doing so would ensure a win on both the economic and environmental fronts.

Sixth, the enormous price tag of environmental deterioration in Arab countries: 95 billion dollars per year, or 5% of GDP.


In addition to the above, the Iraqi economy faces several challenges some of these are: 

A- The endemic production method that pollutes the environment and the infrastructure that relies on oil and gas energy.

B- Desertification and drought because Iraq is dependent on water sources emanating from neighboring countries and not adopting modern methods of irrigation and storage.

C- The ineffectiveness of the tax and customs system in reducing environmental pollution rates and supporting and stimulating environmentally friendly industries.

E - Low awareness and environmental culture among some classes of society.

G- Nuclear waste and pollution resulting from wars.

H- The governmental and community institutions and associations that publish and market green economy methods are very low


1- The green economy is the best solution to preserve the sustainable environment.

2- Technological solutions support the transition towards a green economy and the sustainability of natural resources in light of a set of approved data and foundations that were addressed in the framework of the research.

3- In order to implement the green economy requires many basic pillars that depend mainly on the state's economic policy and its orientation towards the transition to a sustainable green economy.

4- The shift towards a green economy depends mainly on an individual and governmental initiative to support this transformation, as it is reflected in the positives first on individuals and then on society and the state in general.


1- Adopting alternative solutions and imposing taxes on industries that pollute the environment is very important, meaning that the carbon tax is very important to reduce endless pollution while increasing production.

2- The importance of supporting companies and the state to adopt energy-saving and low-waste production policies using the latest technologies adopted in production.

3- The importance of preserving the environment, not wasting resources, and focusing on the shift towards a green economy that supports the environment and its components.

  1. United Nations Development Programme (UNDP). "Green Economy in Action: Articles and Excerpts that Illustrate Green Economy and Sustainable Development Efforts." (2012), p. 4. Morelli, John. "Environmental sustainability: A definition for environmental professionals." Journal of environmental sustainability 1.1 (2011). : 2.

  2. Arab Republic of Egypt. "Sustainable Finance and Green Investment." The Third Forum for Strategies for Transitioning Towards a Green Economy, Arab Republic of Egypt, (2021), p. 21.

  3. Mustafa, Abdi. "The Green Economy as a Requirement to Achieve Sustainable Development." Al-Manara Journal for Legal and Administrative Studies, HassanI University, Morocco, (2020), p. 7.

  4. Popp, David. "The role of technological change in green growth." (2012). 

  5. Rebane, Kaja L., and Bradford L. Barham. "Knowledge and adoption of solar home systems in rural Nicaragua." Energy policy 39.6 (2011): 3064-3075. 

  6. Batrancea, Larissa, et al. "An empirical investigation on the transition process toward a green economy." Sustainability 13.23 (2021): 13151. 

  7. Natalucci, Fabio. "How Investment Funds Can Propel the Green Economy." IMF Blog, (2021) 

  8. Alfredsson, Eva. "The Inclusive Green Economy." (2017), p. 17. 

  9. Albekov, Adam Umarovich, et al. "Green economy and economic growth: trends, challenges and opportunities for the EU." (2017). 

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