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The economic benefit of saving our environment

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Conserving Australia's wildlife has enormous benefits on the economy (Screenshot via YouTube)

Aside from the moral obligation to protect our endangered flora and fauna, the Government would do well to consider the economic value, writes Sue Arnold.

WHAT ARE HEALTHY ecosystems and forests worth? Is there an economic benefit in protecting the environment?

These are questions rarely addressed by governments, particularly governments dominated by the Right wing. Without any value being placed on nature other than the human dollar benefits, balance sheets are invalid.  

Nor can the true extent of economic loss caused by environmental destruction be addressed without these real values being included in any assessment. An important goal in decision making is to ensure balance.    

The public is also entitled to be engaged in any political decisions impacting the future survival of the next generations.

However, there have been attempts to put a price tag on natural resources. Attempts that are outdated and estimates that are assuredly way too low in 2021 as the environmental damage escalates exponentially with climate change driving the juggernaut.

A brief outline of the estimated environmental value of systems on which life depends as expressed in dollars is revelatory.

In 2008, modelling for the Eliasch Review commissioned by the UK Prime Minister estimated that: 

...the global economic cost of the climate change impacts of deforestation would rise to around $1 trillion a year by 2100 if unabated. The total damage cost of forest loss for the global economy could be $12 trillion in net present value terms. These costs are additional to climate change damage caused by emissions from other sectors.

 

The loss of forest carbon services from deforestation is just one lost ecosystem service among many. Other lost services include water regulation and biodiversity. It has been estimated that the damage cost of all forest ecosystem services lost in just one year currently amounts to €1.35–3.1 trillion (AU$2.02 trillion–4.8 trillion).

The economic value of pollination in global agriculture was estimated at $200 billion in 2009.

The total value of bees and their role in agricultural pollination in Australia put the value at U.S.$16 billion (AU$20.6 billion). Insect pollination was valued at U.S.$1.1 billion (AU$1.4 billion).

It has been estimated that around half of the various medicines and other treatments available today have been developed through the study of various animals or other organisms requiring healthy ecosystems.

 In 2014, the total global herbal market of plant-based drugs has been estimated at $25-30 billion annually.

Wetlands have a major economic value according to a 2010 study:

‘A global economic assessment... estimated their value at $3.4 billion per year.   

 

Wetlands are one of the Earth’s most productive ecosystems, described as “biological supermarkets” because of the extensive food webs and rich biodiversity they support.’

Healthy coral reefs are the foundation of the ocean’s food chain. According to a presentation by the U.S. National Marine Fisheries Service, scientists develop important drugs from coral reef organisms as treatments for cancer, arthritis and viruses.

The study indicates coral reefs support commercial and subsistence fisheries, jobs, tourism and recreation. The estimated commercial value of U.S. fisheries from coral reefs is over $100 million.

A UNEP World Conservation Monitoring Centre report in the same study estimates non-market values of coral reefs and mangroves range from U.S.$14,000 (AU$18,101) to U.S.$3.5 million (AU$4.5 million) per square kilometre.

Non-market benefits generated by the Great Barrier Reef have not been a focus of governments. One study suggests the provision of coastal protection by the Reef is estimated to be worth $10 billion. The non-use value has been estimated at $17 million.

The Murray Darling Basin produces $22 billion worth of food and fibre every year. It is the largest and most complex river system in Australia. It provides water to 3 million people.  The basin contains 30,000 wetlands including 16 internationally significant wetlands, 120 waterbird species and 46 native fish, as well as 95 threatened species of plants and animals.

Again, finding research demonstrating the value of Australian biodiversity is a next-to-impossible task. However, a study by the Federal Government in 2005 cited a case study on the worth of the Leadbeater’s possum. The conservation value of this possum alone was estimated to be between $40 million and $84 million a year. The range of value for conserving all 700 species of endangered flora and fauna in Victoria was estimated at $340 million annually. 

According to the study:

‘The estimated economic value for conserving Leadbeater’s possum is two to three times the value of timber cut from its habitat and equivalent in value to both water conservation and recreation values. Therefore, conservation of Leadbeater’s possum habitat would be given priority as it provided a positive benefit to the community when compared to alternative uses.’

The same report estimated the total recreational value for all 23 Victoria national and state parks for the year 1997/98 was over $173 million.

The annual value of wild nature-based tourism to Australia was estimated as between $6 and 23 billion by the WWF in 2014. Ecosystem services provided by protected areas in Australia have conservatively been estimated to be worth a minimum of $38 billion per year.

Value estimates of Australian forests for the ecosystem services are largely ignored:

Peter Kanowski, a professor of forestry at the Australian National University, says we need to change the way we value trees to assess their full benefit.

 

Like Mr Reid, he says a tree's profitability is about more than the wood sales it generates; they deliver "a much wider range of ecosystem services".

 

This includes "carbon sequestration [and] water catchment values, depending on the tree's biodiversity".

 

"Our mechanisms for valuing those other than carbon are still pretty rudimentary," he says.

An article in The Conversation reports koala tourism could be worth $3.2 billion to the Australian economy. According to Professor Hugh Possingham, this iconic animal is an umbrella species of coastal forest ecosystems, and the loss of their habitat involves a significant, potentially irreplaceable loss of biodiversity. 

There’s no accounting for these losses.

Sue Arnold is an IA columnist and freelance investigative journalist. You can follow Sue on Twitter @koalacrisis.

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