Editing IPCC:AR6/SR15/Chapter-4 (section)

== Box 4.10: Synergies and Trade-Offs in Economic Growth, Carbon Neutrality and Happiness ==

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Bhutan has three national goals: improving its gross national happiness index (GNHI), improving its economic growth (gross domestic product, GDP) and maintaining its carbon neutrality. These goals increasingly interact and raise questions about whether they can be sustainably maintained into the future. Interventions in this enabling environment are required to comply with all three goals.

Bhutan is well known for its GNHI, which is based on a variety of indicators covering psychological well-being, health, education, cultural and community vitality, living standards, ecological issues and good governance (RGoB, 2012; Schroeder and Schroeder, 2014; Ura, 2015) <sup>[[#fn:r1519|1519]]</sup> . The GNHI is a precursor to the Sustainable Development Goals (SDGs) (Allison, 2012; Brooks, 2013) <sup>[[#fn:r1520|1520]]</sup> and reflects local enabling environments. The GNHI has been measured twice, in 2010 and 2015, and this showed an increase of 1.8%

(CBS &amp; GNH, 2016) <sup>[[#fn:r1521|1521]]</sup> . Like most emerging countries, Bhutan wants to increase its wealth and become a middle-income country (RGoB, 2013, 2016) <sup>[[#fn:r1522|1522]]</sup> , while remaining carbon-neutral – a goal which has been in place since 2009 at COP15 and was reiterated in its Intended Nationally Determined Contribution (NEC, 2015) <sup>[[#fn:r1523|1523]]</sup> . Bhutan achieves its current carbon-neutral status through hydropower and forest cover (Yangka and Diesendorf, 2016) <sup>[[#fn:r1524|1524]]</sup> , which are part of its resilience and adaptation strategy.

Nevertheless, Bhutan faces rising GHG emissions. Transport and industry are the largest growth areas (NEC, 2011) <sup>[[#fn:r1525|1525]]</sup> . Bhutan’s carbon-neutral status would be threatened by 2044 with business-as-usual approaches to economic growth (Yangka and Newman, 2018) <sup>[[#fn:r1526|1526]]</sup> . Increases in hydropower are being planned based on climate change scenarios that suggest sufficient water supply will be available (NEC, 2011) <sup>[[#fn:r1527|1527]]</sup> . Forest cover is expected to remain sufficient to maintain co-benefits. The biggest challenge is to electrify both freight and passenger transport (ADB, 2013) <sup>[[#fn:r1528|1528]]</sup> . Bhutan wants to be a model for achieving economic growth consistent with limiting climate change to 1.5°C and improving its GNHI (Michaelowa et al., 2018) <sup>[[#fn:r1529|1529]]</sup> through synthesizing all three goals and improving its adaptive capacity.

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