Poverty and Environment
Partnership Says Natural Capital Central to
Development Goals
14/09/2005 - Targeted investments in the
environment will generate substantial economic
returns especially among the more than one
billion people who live on less than a dollar
a day a new report shows.
Every dollar invested in fighting land degradation
and desertification may conservatively generate
over three dollars in economic benefits helping
to fight poverty among the millions living
on fragile lands.
Money could be spent on such traditional and
soil conserving features like terracing.
Meanwhile every dollar spent on delivering
clean water and sanitation is likely to give
impressive rates of return of up to $14. It
indicates that in some cases the income of
the very poor could be boosted fourteen fold.
Here the economic benefits arise from areas
including reduced health care costs, increased
productivity because of workers spending less
time searching for water and improved school
attendance.
Conservation of habitats and ecosystems are
also cost effective when compared with the
short term profits from environmentally damaging
activities such as dynamite fishing, mining
and sedimentation as a result of deforestation
in the interior.
A study of coral reefs in the Caribbean indicates
that sustainable harvesting of coral fish
for food and industries such as the pet and
aquaria trade may be worth $300 million a
year, coral-based tourism just over $2 billion
annually and shoreline protection from reefs
up to $2.2 billion a year.
However, these economic benefits are threatened
by damage and degradation amounting to between
$350 million and $870 million a year. Overall
for every dollar invested in coral reef conservation
economic returns will total up to $5.
Meanwhile the carbon storage or “sequestration”
potential of forests ranges between $360 and
$2,200 per hectare which makes them worth
far more than if they are converted to grazing
or cropland.
Indeed the study claims that once carbon reaches
over $30 a ton it becomes far more cost effective
to conserve forests than to clear them.
Natural capital also serves as back up against
calamities such as droughts or crop failures.
Studies from Brazil show that farmers in the
Amazon’s Tapajos National Park turn to forests
products such as nuts and berries when crop
yields tumble.
In other words, the forest acts as a kind
of nature-based insurance policy for those
denied access to formal insurance and financial
markets.
These are among some of the findings from
“Investing in Environmental Wealth for Poverty
Reduction” prepared on behalf of the Poverty-Environment
Partnership (PEP) for the 2005 World Summit
taking place this week at the headquarters
of the United Nations in New York.
One of the summit’s aims is to review the
status of the Millennium Development Goals
(MDGs) covering poverty eradication and the
provision of safe and sufficient supplies
of drinking water up to the reversal of the
spread of diseases and the empowerment of
women.
Launched in 2000, these internationally agreed
goals are set to be met by 2015.
The partnership, which includes the United
Nations Development Programme, United Nations
Environment Programme (UNEP), organizations
such as IUCN-the World Conservation Union
and government agencies, today meets to plan
how the environment can be mainstreamed in
national poverty reduction strategies in order
to better achieve the Goals.
Klaus Toepfer, UNEP Executive Director, said:”
It is clear from this report, and from a series
of other studies published throughout the
year, that the environment is something like
the red ribbon running through the Millennium
Development Goals. It is not a luxury good,
only affordable when all other problems have
been solved. It is the oxygen that breathes
life into all our aspirations for a healthier,
fairer and more stable world. I would call
on world leaders to recognize this in the
outcome of this important summit”.
“We also need to pursue more imaginative and
clever methods for paying the poor for the
regional and global assets they hold. It has
been calculated that the carbon absorption
value of tropical forests alone is worth tens
of billions of dollars a year. But these ecosystem
services, which largely remove the pollution
of the rich countries from the atmosphere,
are provided gratis and the people paid nothing
for these assets,” he said.
“Increased investment alone is not enough,”
notes Kemal Dervis, Administrator of UNDP.
“To be effective, investments must be implemented
and driven at the grassroots level by communities,
local governments and the private sector.
The poor must have secure rights and access
to natural resources and a greater voice in
decisions over the management of the land,
water and biological resources that support
their livelihoods.”
The PEP report, whose lead author was the
renowned environmental economist Professor
David Pearce who tragically died last week,
outlines the challenges of bringing the value
of the environment into center stage.
The report estimates that, to reach poverty
reduction targets, an annual global investment
in environmental assets of $60 billion to
$90 billion will be needed over the next ten
to 15 years.
At least $80 billion per annum more is needed
to tackle global climate change in order to
stabilize greenhouse gases at 550 parts per
million over the next 50 years. 550 parts
per million is double the concentrations of
these gases from pre-industrial days.
Among the issues that need to be resolved
is the creation of markets, reflecting the
value of natural capital. These need to be
fostered by governments, the United Nations,
non-governmental organizations and the private
sector in areas such as carbon trading, eco
tourism and the use of genetic resources.
Payments for nature may also offer a way forward
such as those being pioneered by hydropower
companies who pay for forest conservation
on rivers upstream.
Local people must also be part of the equation
so that the ‘environmental assets’ are managed
in people and poverty-friendly ways.
A pre-requisite is a stable, corruption-free
government that respects the rule of law and
fosters efficient and accountable public services
and streamlined regulations.
Poor-friendly property rights must also be
urgently addressed and case studies examined
on what does and does not work. Extending
financial credit during times of trouble may
also help ensure that, out of desperation,
poor people are not forced to over use and
run down their ‘natural capital’.
Another important issue is that of the more
than $1 trillion trade subsidies and trade
barriers in rich countries.
The report argues that subsidies on traded
goods from developed economies perpetuate
poverty which in turn can triggers environmental
degradation in the developing world.
Meanwhile subsidies or poor pricing policies
in poorer countries tend to lead to environmental
degradation. For example irrigation subsidies
often lead to inefficient use of supplies
that in turn triggers effects like water logging
and salt contamination of soils.
Notes to Editors
The report, Investing in Environmental Wealth
for Poverty Reduction, and an accompanying
report called Assessing Environment’s Contribution
to Poverty Reduction, can be found at www.povertyenvironment.net/pep
More information on the 2005 World Summit
can be found at www.unep.org
For More Information Please Contact Nick Nuttall,
UNEP Spokesperson, Office of the Executive
Director, on Tel: 254 20 623084, Mobile: 41
79 596 5737, e-mail: nick.nuttall@unep.org.
If there is no prompt response, contact Elisabeth
Waechter, UNEP Associate Media Officer, on
Tel: 254 20 623088, Mobile: 254 720 173968,
e-mail: elisabeth.waechter@unep.org
