How can solar spur economic growth? The Maldives know the answer. After spending $500 million importing fossil fuels in 2022, the country kickstarted its net-zero ambitions by installing 5 megawatts of solar capacity for its islands. 

Miracles happen when nations embrace the sun. New jobs are created and existing businesses can do with improved access to electricity. The question that remains: what happens next for the Maldives? The intersection between solar energy and economic growth offers a clue. 

An Overview of Goal 8 

Sustainable Development Goal 8 seeks to promote quality employment and sustainable economic growth for everyone by 2030. Achieving decent work lifts people out of poverty and fosters innovation, boosting the economy while safeguarding the planet. 

Here’s where we stand on key targets of Goal 8: 

• Real GDP has grown modestly in recent years, and was estimated at 2% in 2024. Least developed countries have experienced more volatility than the globel average.

• Productivity rebounded to 1.5% growth in 2024 after near stagnation in the years prior, but it has yet to return to post-pandemic levels.

• Informal employment affects 57.8% of the global working population. 

• One in five young adults are not enrolled in education, employment, or training.
   
• Global unemployment reached a record low of 5% in 2024, but women and youth continue to face higher unemployment rates. 
   
• Global compliance with labor rights deteriorated by 7% from 2015 to 2023, with the steepest erosion occurring in the least developed countries.

Renewables unlock new opportunities for millions of people. When solar energy enters a rural community, farms gain productivity, businesses expand, and people earn more income. This directly increases the real GDP of a country and builds economic stability. 

5 Ways Solar Energy Powers Economic Growth 

13.7 million. That’s the number of jobs in the renewable energy sector in 2022. It’s a turbo-charged industry that’s growing by the minute. In countries that lack basic energy access, solar energy changes lives by creating direct employment and opening pathways for other financial opportunities. 

Five reasons why investing in solar energy is key to economic growth. 

• Job creation. In 2021, solar PV created 4.3 million jobs around the world. And every dollar invested in renewables creates three times more jobs than fossil fuels. By 2030, there will be 30 million jobs in renewable energy and 40 million jobs in energy efficiency and operations.
  

• Uplifting rural communities. In sub-Saharan Africa, agriculture generates 18% of GDP but only consumes 2% of total energy. Solar systems enable farmers to lead productive harvests and increase revenue. 

• Empowering women. When they gain access to energy, women and girls can spend time doing what matters to them, freed of the burdens that energy poverty places on them. Whether it’s attending school or opening a business, economies flourish when everyone takes part. Currently, women represent 32% of the renewable energy workforce. That number will rise as energy access grows. 

• Energy cost savings. Between 2010 and 2020, the cost of electricity from solar PV systems plunged by 85%. This makes renewables cheaper than the cheapest coal plant. Renewable projects installed in 2020 will save $156 billion over their lifespan. By investing these savings into other sectors, economies grow. 

• Climate security. Renewable energy keeps economies and the planet sustainable. Starting in 2030, the damage avoided from pollution and climate-related impacts could save $4.2 trillion every year. Much of this money goes back into the pockets of small businesses and entrepreneurs. 

Illuminating the Maldives 

Along the island of Malé, something unexpected awaits tourists who pass through the highway: 5 megawatts of solar PV that gather the shining light. The installation provides relief to the nation’s dramatic energy bill, which previously equaled one-fifth of all imports and 10% of GDP. 

A collection of 1,190 islands filled with lush fauna and flora, the Maldives lure 1.7 million tourists annually. But climate change threatens to flood 80% of the islands by 2050—making the destination uninhabitable for visitors and locals. 

By adopting renewables, the country pledges to lower its carbon footprint and safeguard its own future while building its economy. The solar installation saves $30 million dollars every year from diesel imports, equal to $750 million over its lifetime. In the process, jobs are created and the archipelago experiences greater resilience and energy independence—key elements of any robust economy. 

The success of this system hinges on the ASPIRE project, a World Bank initiative that invests in renewable energy integration around the world. Thanks to the success of the Maldives project, other small island nations have been inspired to harness sustainable energies and attract the investors that make it possible. 

Looking Forward: Solar Energy and Economic Growth 

As the clock inches closer to 2030, we’re still not on track to meet Goal 8. Inequality remains present in least developed countries, which face the consequences of indecent work and low economic productivity. Without action, 700 million people will remain trapped in the cycle of poverty despite their employment. 

Solar energy spurs possibilities for progress and development. When communities harness the sun, they gain employment, energy security, and diverse opportunities—all of which contribute to economic growth. We’ve already seen the impacts of renewables on real-life economies. It’s within us to continue advocating for a brighter and bolder future.