A new global study on the economics of ecosystem services and biodiversity loss suggests that governments can achieve more resilient economies and receive higher rates of return on their public investment strategies when they recognise and target the value of ecosystem services.

The TEEB report, 'The Economics of Ecosystems and Biodiversity for National and International Policy Makers', highlights the economic consequences of not valuing ecosystem services and biodiversity, whose benefits are frequently economically invisible in public policy and decision-making. The world is facing a biodiversity crisis: forests, soils, wetlands, coral reefs and ocean fisheries are being depleted at significant rates, and these assets are being lost without a true understanding or reflection of their value in public policies, or in the accounts of society.

The report says that greater investments are needed to maintain and restore ecosystems and for these resources to be used more sustainably. Efficient use of scarce resources introduces the need to move away from an unsustainable, high-consumption, high-production way of living towards a sustainable economy. Public policies that include the worth of natural capital can return significant benefits. For example, it cost about US$1 million to plant and protect around 12,000 hectares of mangroves in Vietnam, but this has saved well over US$7 million on annual dyke maintenance and therefore planting mangroves is an alternative action for preventing coastal erosion and losses due to natural catastrophes.

The report highlights four priority areas that need to be urgently addressed:

  • to halt deforestation and forest degradation. Policies based on 'green carbon' (carbon stored in plants and soils of terrestrial ecosystems including grasslands, forests, wetlands and pasture), such as REDD+ (Reducing Emissions from Deforestation and Degradation, as well as carbon stock enhancement through restoring forest cover and managing forests sustainably), are cost-effective methods of mitigating the impacts of climate change, in addition to protecting ecological services and goods;
  • to protect coral reefs from global warming and ocean acidification. Over 20% of coral reefs are seriously degraded, affecting ecosystem services such as fishing, tourism and coastal protection;
  • to rescue global fisheries from overexploitation and restore stocks. Commercially exploited fish populations have fallen by over 90% in some parts of the world with an estimated loss of benefits of US$ 50 billion per annum, which is over half the current annual value of landed catch; and
  • to recognise the link between degradation/loss of natural systems and rural poverty and ensure policies which support the maintenance and provision of the services generated by ecosystems for local people.

Long-term management of natural capital needs better understanding of biodiversity and ecosystem services and the ability to measure them. The researchers analysed existing approaches and recommend the use of science-based indicators to monitor progress and to warn of possible 'tipping points' or sudden ecosystem collapse.