The world’s economic system must find value in protecting nature instead of profiting from its rapid decimation, according to a first-of-its-kind report.
An independent review led by Prof Sir Partha Dasgupta, an economist at the University of Cambridge, said that the world’s worsening biodiversity crisis is linked to a “deep-rooted, widespread institutional failure” to recognise the value of nature.
Nature is “our most precious asset” because it provides us with “food, water and shelter”, a space for recreation and wellbeing, and protection against diseases and the impacts of the climate crisis, according to the report.
But our current demands of nature “far exceed its capacity to supply us with the goods and services we all rely on”, said the report, which was commissioned by the Treasury in 2019.
Sir David Attenborough, who wrote the foreword for the Dasgupta Review, said: “The survival of the natural world depends on maintaining its complexity, its biodiversity. Putting things right requires a universal understanding of how these complex systems work. That applies to economics too.
“This comprehensive and immensely important report shows us how by bringing economics and ecology face to face, we can help to save the natural world and in doing so save ourselves.”
In order to maintain our current rates of resource use, we would need the equivalent of 1.6 Earths, the review notes.
Prof Dasgupta said: “Truly sustainable economic growth and development means recognising that our long-term prosperity relies on rebalancing our demand of nature’s goods and services with its capacity to supply them.
“It also means accounting fully for the impact of our interactions with nature across all levels of society. Covid-19 has shown us what can happen when we don’t do this.”
A landmark report published in 2019 found that one million animal and plant species are now at risk of extinction as a result of human pressures. Threats facing wildlife include habitat loss, the illegal trade of wildlife and the climate crisis, which is creating intolerable living conditions for many species.
The Dasgupta Review warned that the goods and services provided by nature are “not reflected in market prices”, which has led economies to “underinvest in our natural assets”.
“But this is not simply a market failure: it is a broader institutional failure too,” the report said.
“Governments almost everywhere exacerbate the problem by paying people more to exploit nature than to protect it, and to prioritise unsustainable economic activities.”
Conservative estimates suggest that nations currently spend $4-6 trillion (£3-4 trillion) a year on subsidies that damage nature, according to the report.
It argues that, to reverse biodiversity loss, “nature needs to enter economic and financial decision-making in the same way buildings, machines, roads and skills do”.
This means that “inclusive wealth”, a measure that accounts for the services provided by nature, should be prioritised over traditional measures of economic activity such as gross domestic product (GDP), according to the report.
“By measuring our wealth in terms of all assets, including natural assets, ‘inclusive wealth’ provides a clear and coherent measure that corresponds directly with the wellbeing of current and future generations.”
An upcoming UN biodiversity summit known as Cop15, which is to be held in Kunming, China, in May, is likely to be an “important opportunity” to set a new direction for valuing biodiversity, the report said. Cop26, a climate summit which is to be hosted by the UK in November, will also provide an opportunity for action.
It is worth noting that some environmentalists oppose the idea of putting a price on nature and argue it could pave the way for biodiversity being bought and sold by companies.
Prime minister Boris Johnson, who is to appear at the launch event of the Dasgupta Review held by the Royal Society later today, said: “This year is critical in determining whether we can stop and reverse the concerning trend of fast-declining biodiversity.
“I welcome Prof Dasgupta’s Review, which makes clear that protecting and enhancing nature needs more than good intentions – it requires concerted, coordinated action.
“As co-host of Cop26 and president of this year’s G7, we are going to make sure the natural world stays right at the top of the global agenda.”
Green Party MP Caroline Lucas said the review “should send shockwaves through the Treasury”.
She added: “We can enhance biodiversity and create a better society for everyone if we abandon an outdated, destructive way of thinking about the economy as separate from the environment and wellbeing and move to one focused on people’s health, quality of life and the regeneration of nature.
“Two-thirds of the public think that the government should focus on health and wellbeing over GDP, and 2021 – the year of two critical UN summits – is the year to do it.”
Commenting on the report, Sir Bob Watson, former chair of the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES), said: “This important report demonstrates how nature is an asset that plays a vital role in the human well-being of current and future generations.
“But we can only realise this potential if we stop over-exploiting it, embrace natural capital in decision-making and invest in its conservation and restoration.”
Jennifer Morris, CEO of the Nature Conservancy, an environmental non-profit, added: “The Dasgupta Review issues a clarion call to world leaders: we must tackle the nature crisis in conjunction with the climate emergency for the sake of our economies, livelihoods, and wellbeing – and those of future generations.
“The Covid-19 pandemic has laid bare the full extent of our broken connection with nature – but it has also highlighted the power of global, radical collaboration in addressing complex problems with urgency. This same collective energy must now be applied to preventing the further destruction of nature.”
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