Why the World Must Not Consider Nature 'Priceless'

If Mother Nature had a bank account, she would be one wealthy lady -- at least that's according to a report released today on The Economics of Ecosystems and Biodiversity (TEEB). In hopes of countering the notion that environmental systems are literally priceless -- that is to say, without an agreed upon monetary value -- the 10th UN conference for the Convention on Biodiversity aims to quantify nature in economic terms. It is only when the environment is considered a financial asset, claims the report, that the most devastating of human activities will be truly robbed of an economic incentive.The lead-author of the TEEB report, Pavan Sukhdev, draws a direct parallel between harmful human-caused problems like pollution and habitat loss, and the lack of economic value to placed upon the world's ecosystems:

We argue that the economic invisibility of nature is one of the main drivers for the loss of biodiversity and the ongoing degradation of ecosystem.

In a previous report from TEEB, the convention estimated the value of devastated environmental assets to be at least $2 trillion dollars a year. Now, the group is trying to find a way to enact their assessments in a meaningful way that governments will agree upon globally. The Convention on Biodiversity hopes their latest report will help establish a new international goal for curbing the loss of biodiversity by 2020.

One such example of nature's service that has yet to be measured monetarily is the tireless work of pollinating insects which makes agriculture possible. "A bee doesn't send you and invoice," says Sukhdev, indicating the importance of determining the value of its labor, lest it be exploited or placed in jeopardy.

Reports have placed the value of insects that pollinate human crops at over $211 billion.

Other examples of the economics of nature are as follows, taken from a 2005 report from TEEB, via Time.

US$ 50 billion

The annual loss of opportunity due to the current over-exploitation of global fisheries. Competition between highly subsidized industrial fishing fleets coupled with poor regulation and weak enforcement of existing rules has led to over-exploitation of most commercially valuable fish stocks, reducing the income from global marine fisheries by US$50 billion annually, compared to a more sustainable fishing scenario (World Bank and FAO 2009).

US$30 billion - US$172 billion

The annual value of human welfare benefits provided by coral reefs. Although just covering 1.2% of the world's continent shelves, coral reefs are home to an estimated 1-3 million species including more than a quarter of all marine fish species. (Allsopp et al. 2009). Some 30 million people in coastal and island communities are totally reliant on reef-based resources as their primary means of food production, income and livelihood. (Gomez et al. 1994, Wilkinson 2004) Estimates of the value of human welfare benefits provided by coral reefs range from US$30 billion (Cesar et al. 2003) to US$172 billion annually (Martinez et al. 2007)

While it might be hard to argue with the importance of giving nature the monetary value she's due, getting governments and corporations to acknowledge it will be an up-hill battle. "It could happen, but not in today's environment," Patrick Michaels of the Cato Institute told the New York Times. "Right now, people -- and not just in the US -- people are worried about the economic contractions more than they are about environmental protection."

But monetizing nature, if you will, would not necessarily create a new financial burden to a world in troubled economic times. The NY Times cites a situation in which farmers in New York were given a $1 billion incentive to reduce water pollution caused by runoff. In the long run, the state saved $8 billion dollars by not having to build a wastewater treatment plant that would have been needed to combat the problem without better agricultural management.

So far, developing nations like Brazil and India have stepped forward in support of the TEEB report's findings, and they aren't alone. The EU has also voiced their willingness to comply with creating a system by which the environment would be placed into the marketplace along with other global assets.

Sukhdev says he hopes that, despite however long it may take to achieve a international consensus on the TEEB report, it will only be a matter of time before the United States signs on as well. "We are at a state now where the rate of loss of ecosystem services and the rate of loss of biodiversity is so severe we cannot treat them as mere externalities of economics," he said.

It only makes sense that Mother Nature be valued appropriately in a world that runs on money -- after all, if she continues to be exploited without consequence, perhaps one day our currencies may only be valuable for kindling.

More on TEEB
Study Shows Investing in Nature More Valuable than Gold (Literally)
Further Proof: Preserving Biodiversity is Profitable Business
Restoring Ecosystems Biggest Untapped Ally in Fighting Climate Change

Tags: Biodiversity | Developing Nations | Economics | United Nations