Global Leaders and Scientists on the Economic Cost of Biodiversity Loss
A report in the Dasgupta Review shows that by using a fiscal lens to view Earth's growing biodiversity loss, we can see how it links to economic development. By viewing nature as an asset like "produced capital (roads, buildings and factories)" or "human capital (health, knowledge and skills)" -- as the report defines them -- it is apparent that biodiversity makes nature more economically valuable.
And at the panel, Transitioning to a Nature-Based Economy, hosted on Monday by the Center for American Progress and the British Embassy, a series of economists and government officials discussed how the global economy can reinforce biodiversity and vice versa.
Why this Matters
More governments and institutions are beginning to recognize that the destruction of our world's ecosystems would be financially disastrous. Climate change will not only cause loss of natural resources and valuable carbon sinks, but reviving the health of damaged ecosystems and biodiversity is incredibly costly with dire consequences to global health and food security.
During the panel, Sir Partha Dasgupta, the Frank Ramsey Professor Emeritus of Economics at Cambridge University, gave the example of a peat bog, which stores carbon and protects water quality. Should peatlands be destroyed by climate change or human development, the government would have to pay for water purification plants to replace that lost nature-based service.
Center For American Progress: Transitioning to a Nature-Centered Global Economy, October 25, 2021.
Investing in Natural Assets
British Ambassador to the US Dame Karen Pierce and Senator Brian Schatz of Hawaii spoke about putting the economic value of nature into action. Senator Schatz emphasized that deforestation counts for at least 10% of greenhouse gas emissions, and nearly 40% of tropical deforestation results from illegal clearing. He created a bill that would prohibit imports produced from illegally deforested lands as a means of disincentivizing deforestation, which leads to biodiversity loss.
Ambassador Pierce highlighted initiatives taken by the UK to fight climate change's economic effects, such as setting the first legally binding emissions reductions target in 2008 and being the first major economy to legislate for zero carbon emissions by 2050. In advance of COP26, she emphasized that it’s time to take steps to restore biodiversity loss, saying: "It is not just about ambition, it's about translating that ambition into action."
The Bennett Institute for Public Policy: The Wealth Economy - Natural and Social Capital, March 10, 2020.