Asean GDP must mirror biodiversity’s worth

Dennis D. Estopace Business Mirror 28 Jan 12;

ECONOMIES this side of Asia may be growing but fail to reflect the value of the resources backstopping such growth and, ironically, what keeps the region unique: its diverse ecosystem.

“Policy-makers should internalize that there is a cost on the impact of export activities in the environment, in the ecosystem, and that’s not sustainable,” said Pushpam Kumar, chief of the Ecosystem Services Economics unit of the United Nations Environment Programme (Unep).

Kumar spoke during the first Southeast Asia Regional Policy Dialogue on the Economics of Ecosystems and Biodiversity on Friday at a hotel in Makati. It was keynoted by British Ambassador Stephen Lillie.

Organized by the Asean Centre for Biodiversity (ACB) and the British Foreign and Commonwealth Office, results of the dialogue were expected to be echoed to policy-makers in the governments of the attending representatives of Brunei, Indonesia, Malaysia, Singapore, and, of course, the Philippines, ACB Executive Director Rodrigo Fuentes said.

Kumar’s presentation emphasized on the inability of Asian countries to evaluate that the growth in gross domestic product (GDP) excludes the poor farmers and fisherfolk who are “most seriously impacted by ecosystem losses.”

According to Kumar, these are 540 million people in the region who are engaged in farming, animal husbandry, informal forestry and fisheries.

Sure, there was GDP growth in the region in the last two decades and, indeed, contributed to the strength of the economies, Kumar said.

“[But] the productive base of the economy continues to be eroded without being reported and accounted. Indicators like GDP are distorted and does not reflect the changes in the level of welfare; growth accounting does not incorporate ESS, leading to erroneous sense of gain and/or losses; and, drivers like trade and investment impacting the ecosystems have far reaching impact for society.”

In Unep’s computation, ecosystem services, or ESS, add “only 7.3 percent” to conventional GDP, but 57 percent to what Kumar said is the “GDP of the poor.”

“The replacement of those ESS is beyond the capacity of the poor: they would need to spend twice their incomes.”

“We are also reviewing climate change and biodiversity action plans, and identifying approaches to integrate TEEB [The Economics of Ecosystems and Biodiversity] and PES [payments for ecosystem services] into such plans,” Fuentes said in his speech at the opening of the dialogue.

“In addition, the project is developing a training module on TEEB and PES for continued capacity building in the Asean region.”

Fuentes explained that the TEEB is a landmark study that assesses the economic impacts associated with losing natural capital.

“The TEEB outlines the cost of policy inaction and finds that under a ‘business as usual’ scenario, an average year’s natural capital loss would lead to a loss of ecosystem services worth around $2 trillion to $4.5 trillion over a 50-year period.”

He added that if economies fail to account for the value of these losses, it “would lead to wrong choices and decisions in addressing sustainable development challenges.”

Fuentes told the BusinessMirror at the sidelines of the dialogue that the representatives would have to go back to their respective governments to lobby for the adoption of policy recommendations raised during the dialogue.

“At the end of the day, it would have to be the governments to decide if they seriously want to pursue a brighter future for all Asians. For the Philippines, it’s high time since we’ve been given several wake-up calls, the latest of which was the tragedy in Cagayan de Oro [and Iligan City].”

He added in Filipino: “We need to wake up those in the LGUs [local government units] that it is not enough to just do politics; the lives of many people are at stake.”