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This publication is concerned with all policies that directly support the production or consumption of fossil fuels in OECD countries and in a selection of partner economies. It provides a useful complement to the online OECD database that identifies and estimates direct budgetary transfers and tax expenditures benefitting fossil fuels, and from which it derives summary results and indicators on support to fossil fuels, as well as policy recommendations.

This report emphasises the problems that fossil-fuel subsidies cause in the context of broader policy efforts for mitigating greenhouse-gas emissions, and reviews the various reform initiatives that have already been taken at the international level (G-20, APEC, etc.). In addition, it presents the coverage, method and data sources used for constructing the online database, and further discusses caveats and data interpretation.

This report is concerned with policies that directly support the production or consumption of fossil fuels in OECD countries and in a selection of partner economies. It provides a useful complement to the online OECD database that identifies and estimates direct budgetary transfers and tax expenditures benefitting fossil fuels, and from which it derives summary results and indicators on support to fossil fuels, as well as policy recommendations.

This report emphasises the problems that fossil-fuel subsidies cause in the context of broader policy efforts to mitigate greenhouse-gas emissions, and reviews the various reform initiatives that have already been taken at the international level (G-20, APEC, etc.). In addition, it presents methods for combining the IEA and OECD support estimates and for measuring the support element of government credit assistance.

Belgium has made progress in decoupling several environmental pressures from economic growth, in improving wastewater treatment and in expanding protected areas. Regions have achieved high levels of recovery and recycling, and have pioneered circular economy policies. However, further efforts are needed to progress towards carbon neutrality, reduce air and water pollution, reverse biodiversity loss and consolidate results of circular economy initiatives. Strengthening co‑ordination between the federal government and the regions, and among the regions, as well as enhancing policy coherence will be key factors of progress.

As the COVID-19 emergency passes, recovery efforts should focus on putting the country back on track to meet the Sustainable Development Goals. Investing in low-carbon and natural infrastructure, promoting circular economy, strengthening carbon prices and phasing out environmentally harmful subsidies should be priorities.

This is the third Environmental Performance Review of Belgium. It evaluates progress towards sustainable development and green growth, with special features on biodiversity and waste, materials management and the circular economy.

Chile has made important strides on its environmental agenda in recent years with the passage of the Framework Law on Climate Change, the establishment of the Biodiversity and Protected Areas Service and the ratification of the Escazú Agreement. However, the country has made limited progress in decoupling environmental pressures from economic growth. Greenhouse gas emissions have continued to rise and the country is not on track to reach its legally binding target of net zero by 2050. Chile is well-positioned to achieve its targets for biodiversity, while air pollution remains a serious public health challenge and waste management relies heavily on landfilling. Chile is facing a severe and deepening water crisis that requires concerted action to improve water allocation and water quality, and to strengthen water governance. The review provides 36 recommendations to help Chile improve its environmental performance, with a special focus on water management and policies.

This is the third Environmental Performance Review of Chile. It provides an independent, evidence-based evaluation of the country’s environmental performance since the previous review in 2016.

A megadiverse county, Costa Rica is known globally for its success in reversing deforestation and pursuing a growth model based on the sustainable use of its environmental resources. However, energy use and related greenhouse gas emissions increased in the last decade. Private cars are a major and growing source of emissions affecting climate and air quality. Waste disposal still relies on landfills, and much wastewater is untreated. Costa Rica’s extensive protected area network and pioneering programme of payments for ecosystem services have helped reduce biodiversity loss and extend forests’ carbon sequestration capacity. However, more should be done to tackle pressures on biodiversity from development of infrastructure and settlements, tourism, farming and fishing. The sheer scale of investment needed to achieve the Sustainable Development Goals calls for improving the efficiency of public spending, mobilising private finance, strictly enforcing regulations and providing adequate incentives.

This is the first OECD Environmental Performance Review of Costa Rica. It evaluates the country’s progress towards sustainable development, with a special chapter focusing on biodiversity, and provides 52 recommendations.

Finland has a strong reputation as a leader in environmental policy and sustainable development. It committed to become carbon neutral by 2035 and to pioneer the world’s first circular economy. However, it is not fully on track to meet its ambitious goals. Greenhouse gas emissions fell in the last decade, but they need to decline at a much faster pace to meet the target. Waste generation, material consumption and nutrient losses to water bodies have continued to rise. Agriculture and a large forestry sector exert pressures on the country’s biodiversity. Targeted policy measures are needed to provide adequate incentives, boost investment and innovation and steer the economic recovery from the COVID-19 crisis towards the green transition. Finland should move from good strategy making to effective and coherent implementation. It needs to get the right policies in place, to secure sufficient resources and ensure continued and broad public consensus.

This is the third Environmental Performance Review of Finland. It evaluates progress towards green growth and sustainable development, with a special chapter focusing on climate change mitigation and well-being.

Greece has undergone extensive reforms to cope with a deep recession over the past decade. It has made progress in decoupling air pollutant emissions from GDP and improving the conservation status of natural habitats. However, the country faces challenges in managing waste and water, and addressing air pollution. It is highly vulnerable to the impact of climate change. The energy mix has shifted towards cleaner fuels, but the economy strongly relies on fossil fuels. Progress towards sustainable development requires effective implementation of ambitious climate mitigation and adaptation policies, strengthening environmental governance and enhancing coherence between environmental and energy, transport, agriculture and tourism policies.

This is the third Environmental Performance Review of Greece. It evaluates progress towards sustainable development and green growth, with special features on climate change mitigation and adaptation, and biodiversity conservation and sustainable use.

Israel’s rapid economic and population growth along with a high degree of urbanisation continue to exert significant pressure on the environment. Israel has raised its climate ambitions in recent years, though is not on track to reach greenhouse gas reduction targets. Enhancing biodiversity protection, addressing water pollution and adapting to the impacts of climate change require further action. Israel has taken a number of key steps to advance its zero waste and circular economy agenda. However, further efforts are required to improve waste management and introduce an economy-wide shift to a circular economy. The review provides 24 recommendations to help Israel improve its environmental performance, with a special focus on waste management and circular economy.

This is the second Environmental Performance Review of Israel. It provides an independent, evidence-based evaluation of the country’s environmental performance over the past decade.

Lithuania’s rapid economic growth has increased many environmental pressures. The country has declared ambitious medium- and long-term climate change mitigation goals. However, existing policies will not be enough to meet them. Total greenhouse gas emissions have not declined over the last decade, while those from transport have been rising rapidly. Lithuania needs to build on its impressive progress in moving away from landfilling to reduce waste generation and steer towards a circular economy. Water pollution with nutrients from the increased use of fertilisers and insufficiently treated wastewater must also be addressed. These efforts require improved integration of environmental considerations into sectoral policies and a whole-of-government approach to environmental management.

Lithuania is implementing a series of positive changes in environment-related taxation. However, the trend of declining public environmental expenditure should be reversed. One priority area is additional investment in public transport and improvements in cycling and walking conditions that would help steer user behaviour towards sustainable transport modes.

This is the first OECD Environmental Performance Review of Lithuania. It evaluates progress towards green growth and sustainable development, with a special chapter focusing on sustainable mobility.

Luxembourg has made progress in decoupling environmental pressures from economic growth, treating wastewater and managing waste and materials. It has also positioned itself as an international centre for green finance. Yet, it remains one of the most carbon- and material-intensive economies in the OECD. The country is a crossroads for freight traffic and attracts thousands of daily cross-border commuters. This exacerbates greenhouse gas emissions, air pollution and road congestion. Urban sprawl, landscape fragmentation and agriculture exert strong pressures on biodiversity.

To steer its economy towards a greener model, Luxembourg has set ambitious environmental objectives. Greening taxation, providing stronger price signals, promoting eco-innovation and the circular economy, mainstreaming biodiversity into all policies, and investing in low-carbon infrastructure and sustainable mobility, should be priorities.

This is the third Environmental Performance Review of Luxembourg. It evaluates progress towards green growth and sustainable development, with special chapters focusing on two major issues: air quality and mobility, and biodiversity.

OECD Environmental Performance Reviews provide independent assessments of countries’ progress towards their environmental policy objectives. Reviews promote peer learning, enhance government accountability, and provide targeted recommendations aimed at improving environmental performance, individually and collectively. They are supported by a broad range of economic and environmental data, and evidence-based analysis. Each cycle of Environmental Performance Reviews covers all OECD countries and selected partner economies. The most recent reviews include Chile and France (2016).

This report is the third Environmental Performance Review of New Zealand. It evaluates progress towards sustainable development and green growth, with a focus on water resources management and sustainable urban development.

Norway has made progress on the path towards green growth over the past decade. The country is a frontrunner in many environmental areas and invests heavily in technological development and innovation to support its green transition. It set many ambitious national environmental targets across all sectors, including for climate mitigation; Norway aims to achieve climate neutrality by 2030. While not a member of the European Union, Norway has aligned its action with many EU regulations and goals, sometimes more stringently than members. Despite progress in many areas, the country still faces multiple challenges, including sustainable consumption patterns and biodiversity protection. The review provides 30 recommendations to help Norway further improve its environmental performance, with a special focus on sustainable land use and biodiversity management.

This is the fourth Environmental Performance Review of Norway. It provides an independent, evidence-based evaluation of the country’s environmental performance over the past decade.

Portugal managed to decouple several environmental pressures from economic growth over 2013-19. It played a leading role in the approval of the European Climate Law and adopted the Portuguese Framework Climate Law in 2021. This needs to be swiftly implemented to achieve carbon neutrality by 2050, improve climate resilience and protect ecosystems. Portugal has stepped up adaptation efforts but needs to do more to address multiple threats, including coastal erosion, floods, droughts and forest fires. The country is lagging behind in waste management. Meanwhile, the increase in freshwater abstractions in water-scarce southern regions is a concern.

This is the fourth Environmental Performance Review of Portugal. It provides an evidence-based assessment of the country's progress towards its environmental goals over the past decade. The 26 recommendations aim to help Portugal improve its environmental performance, giving special focus to carbon neutrality.

The Slovak Republic has reduced some environmental pressures over the past decade. However, it needs to do more to reduce air pollution, improve waste and wastewater treatment and move towards carbon neutrality. Since 2011, the country has taken important steps to improve its biodiversity policy. Slovakia needs to now align its strategy with the Kunming-Montreal Global Biodiversity Framework and the EU Biodiversity Strategy for 2030. Most species and habitats are in an unfavourable state and biodiversity considerations are not sufficiently integrated into sectoral policies.

This is the third Environmental Performance Review of the Slovak Republic. It provides an evidence-based assessment of the country's progress towards its environmental goals over the past decade. The 29 recommendations aim to help Slovakia improve its environmental performance, giving special focus to biodiversity and forests in the context of climate change.

Switzerland has taken steps to improve the environmental performance of its agricultural, energy and transport sectors. The country is a top OECD performer in terms of greenhouse gas emissions intensity and it should be commended for its innovative approach towards rehabilitation of its river system. Yet unsustainable consumption patterns and high levels of municipal waste generation, as well as high percentages of threatened species, are areas of concern. As a major financial centre, Switzerland has a key role to play in promoting green finance.

This is the third Environmental Performance Review of Switzerland. It evaluates progress towards sustainable development and green growth, with special features on: water management and biodiversity conservation and sustainable use.

Over the past decade, the United Kingdom has reduced several environmental pressures while growing its economy. Ahead of its presidency of the 2021 UN Climate Change Conference of the Parties, it has led the way by raising its national ambition. However, air pollution, deteriorating natural assets and missed biodiversity targets are all concerns. Further efforts are needed to achieve net zero greenhouse gas emissions by 2050, prepare for climate change, reverse biodiversity loss and ensure a more resource-efficient circular economy. Strengthening co‑ordination between the United Kingdom and devolved governments, as well as enhancing coherence between sectoral and environmental policies will be key.

This is the third Environmental Performance Review of the United Kingdom. It evaluates progress towards green growth, with a special chapter focusing on waste, materials management and the circular economy.