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U.N. report stresses the value of nature to world's economies

By Juliet Eilperin
Washington Post Staff Writer
Wednesday, October 20, 2010; 2:03 AM

The world has vastly underestimated the economic value of nature in developing nations, according to a report the United Nations is releasing Wednesday.

Ecosystems such as fresh water, coral reefs and forests account for between 47 percent and 89 percent of what the U.N. calls "the GDP of the poor," meaning the source of livelihoods for the rural and forest-dwelling poor, according to the study.

"Mainstreaming the Economics of Nature" is the last of four reports produced by the U.N. Environmental Program over the past two years and aims to capture how habitats such as tropical forests and coral reefs contribute to countries' economic bottom lines. The authors - led by Pavan Sukhdev, a banker who heads UNEP's Green Economy Initiative - released their findings just as signatories to the Convention on Biological Diversity began meeting Monday in Nagoya, Japan.

"The economic invisibility of nature is a problem," Sukhdev told reporters in a phone call Tuesday. "This is not just an issue for one species. This is actually a problem for human well-being."

Sukhdev cited the example of coral reefs, on which as many as 500 million people worldwide depend for fisheries and tourism. Economists now value reefs at between $30 billion and $172 billion per year, he said, even as they are being threatened by warmer and more acidic seas as a result of climate change.

If reefs collapse because of warming and other factors, he added, this could prompt huge numbers of people to move in Southeast Asia, Africa and other regions, causing political instability and strife. "There is a serious risk there will be significant migrations away from coastal areas," he said.

Some of the environmental benefits that economists have begun to calculate could disappear soon, the authors noted. The pollination that forests in Sulawesi, Indonesia, provide are worth nearly $26 per acre, according to a 2007 study, but ongoing forest conversion in the region is expected to cut pollination- and by extension, coffee yields in Sulawesi - by up to 18 percent over the next 20 years.

At least two major developing countries - India and Brazil - announced Wednesday that they would embrace this method of calculating the value of natural capital when charting national policy.

The idea of incorporating ecosystem benefits into policymaking has yet to gain the same level of traction in the United States, however, where a proposal to cap greenhouse gas emissions collapsed this year after critics said it would damage the nation's economy.

"I'm not seeing, as of yet, anything firm coming from the North American continent, but I'm hoping it's a matter of time," Sukhdev said.

Andrew Deutz, who directs international government relations for the Nature Conservancy, an advocacy group, said the report could be "the Rosetta stone" for the conservation community by helping them translate concerns over species loss and habitat degradation into economic terms for policymakers.

"Our only hope to save the world's biodiversity is to help the world understand that lasting economic growth and security are wholly bound to the health and security of our natural resources," Deutz said.

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