Natural Resources Economic Value
|January 9, 2007||Posted by Staff under Archive, Progress Report, The Progress Report|
Assigning Economic Value to Conservation
Measuring the Value of Forests
They call this “new.” In reality, the Global Resource Bank has been advocating this geoist idea for more than eight years! Still, it is nice to see people catch up.
By Wesley Gibbings
A group of leading scientists, thinkers and policy makers is proposing a new global system to measure the economic value of unexploited forests through the formulation of a mechanism being described as “forest capital”.
The proposal was explored here Tuesday by Indonesian co-chairman of the World Commission on Forests and Sustainable Development, Professor Emil Salim.
Salim, a former government minister in his native Indonesia, says it is possible to divide world forest users into two main groups — exploiters and conservers.
Exploiters tend to focus on the ability of forests to deliver timber, land for agriculture and abundant mining possibilities. “These people are interested in getting rid of forests,” he says.
Conservers, on the other hand, are interested in forests as watersheds, habitats for people and animal species, as absorbers of carbon and for eco-tourism.
The latter group’s interests are not often given governmental attention because an economic value is not usually attached to the use of forests for those purposes.
Fellow commission member, American scholar Dr George Woodwell, adds that “governments are weak when it comes to protecting the public interests against commercial interests.”
Salim’s suggestion is that countries be rewarded for not exploiting forests through the development of a concept called “forest capital” which would be calculated as a product of the opportunity cost of not exploiting these resources on a sustainable basis.
A value would thus be placed on the income foregone through not exploiting the forests and “forest capital credits” granted by international financial agencies. This, he says, would open the door for “moving forest surfaces into the market economy.”
Commission co-chairman, former Swedish Prime Minister Ola Ullsten, agrees with this thesis and suggests that forestry products are, in any event, grossly under-valued.
“We have almost systematically under-valued forestry products,” he says.
He suggests that it is time for greater focus on “ecological capital” as a concept at the heart of the development process.
In the past, people thought of human needs only in terms of consumer goods, but the importance of natural resources ought now to take centre stage, Ullsten says.
“What is at the core of environmental degradation is the failure to understand the importance of sustainable development. A stable and secure environment is a basic human need,” he argues.
Ullsten says the Commission has also come to the realisation that not only are forests declining but that the products and services provided by the forests are also disappearing.
He points to the fact that more people use forests as habitats than the entire population of the United States of America.
“We live in a full world. We cannot anymore justify deforestation.” He adds that the situation was “a crisis requiring urgent attention” and that since the 1992 Rio Summit, more than 90 million hectares of forest have been lost.
He predicts that before the end of the decade, another 30 million hectares could be lost, a situation that he says has the potential to “change the character of the planet”.
What is also evident, he adds, is that “the causes of the crisis have their roots in human institutions.”
“We can reverse it, or we can worsen it,” he says. “We are not only accidentally causing forest decline, but deliberately doing so.”
To change the situation, Ullsten suggests that sacrifices will have to be made. He says just as the world had moved from an industrial to a post-industrial age, there should now be a move from non-sustainable to sustainable society.
Changes in capital consumption “will lead us into a more stable society environmentally,” he says.
In that regard, he says he is encouraged by some positive signals, especially “rising awareness among young people” and in some business communities.
Ullsten revealed that the Report of the Commission, to be completed in the coming months, will recommend that the world “get the prices of forests right.”
He says it is also necessary to “get planning right” with governments setting aside “areas we want to protect.”
The Commission co-chairman says it is important, as well, that the world “get the ethics right” and that old positions have to change. This, he says, almost certainly means “a case of more solidarity between North and South for the benefit of all of us.”
The Commission was appointed following the Earth Summit held in Rio de Janeiro, Brazil in 1992.
What’s your opinion on this initiative to assess the value of “forest capital”? Tell The Progress Report what you think!