Jennifer Morris Chief Executive Officer, The Nature Conservancy
$700,000,000,000 - THAT’S THE COST OF RESTORING OUR RELATIONSHIP WITH NATURE
If we want a truly resilient global economy, we need a new relationship with nature What will it cost to keep our planet healthy? It should be a question keeping many of us up at night – including central bankers. Covid-19 presents a public health crisis unlike any we have seen in recent memory, and it has created a daunting financial crisis as well.
Governments around the world are spending trillions of dollars to prevent global economic meltdown and, although there is urgency to implement stimulus packages to stave off further recession, it would be prudent to consider the long-term ramifications of this spending, for people and the planet.
Healthy societies and healthy economies cannot exist without a healthy planet. Clean air and water, a stable climate, abundant food, resilience to natural disasters— these things all depend on nature. So, it makes sense that any measures to rebuild the economy must be both environmentally as well as financially sustainable, now and in the long-term.
We haven’t always done a good job with this sort of thinking.
New analysis from The Paulson Institute, The Nature Conservancy and Cornell University shows that even in economic boom times, we woefully under-valued and under-invested in nature.
Instead of treating nature as a valuable set of assets that can grow and produce sustained benefits over time, we have been treating it like an unlimited bank account and spending down the balance at a much faster rate than it is gaining interest.
Just how badly have we overdrawn this account? In 2019, the world spent between $124-143 billion a year on conservation activities that benefited nature. But our new analysis indicates we need to spend between $722-967 billion annually to adequately protect and begin to restore nature – and to fully realise the value of the many services that healthy natural systems provide to people.
The impacts of that $700+ billion gap have been, well, costly.
The destruction and degradation of natural habitats around the world could result in the extinction of up to a million species, even as it contributes to accelerating climate change and diminishing food and water security.
Perhaps most frightening, there’s a growing body of evidence that encroachment on natural habitats, unsustainable wildlife trade and the resulting human and domesticated livestock contact with wildlife increases our risk of encountering viruses like the one responsible for our current pandemic.
Still, there are ways we can close this financing gap and reverse its negative impacts—even in the tighter economic climate we find ourselves in today. Indeed, we must close this gap if we’re concerned with the long-term health and prosperity of our societies. It’s not enough just to rebuild. We need to build something that’s better.
So what will it take to rebuild an economy that benefits nature? First, we need to cease or redirect economic activity that harms nature. Agricultural subsidies, for example—which add up to more than $500 billion a year globally—could be shifted away from practices that degrade nature and instead underwrite practices that restore soil and water quality as well as support the livelihoods of farmers.
HEALTHY SOCIETIES AND HEALTHY ECONOMIES CANNOT EXIST WITHOUT A HEALTHY PLANET.
Just redirecting money from these harmful investments toward those that benefit nature would go a long way toward closing the financing gap of global biodiversity conservation.
Second, we need to get more creative with how we generate new funding to protect and restore nature.
In the private sector, there is huge room for growth in green finance tools such as green bonds and green equity funds that fund biodiversity-enhancing initiatives.
But to realise this potential, governments must create the conditions that catalyse private sector investment by developing and enforcing mechanisms that require industries to value nature in their operations and through their supply chains, minimise their negative impact on nature and compensate for unavoidable impacts by restoring or protecting ecosystems elsewhere.
Finally, we can be more efficient with how we deploy money that we are spending on other efforts. Take public infrastructure works, for example. Coral reefs, forests and wetlands and other ecosystems provide healthy, sustainable habitat for wildlife, while also delivering important services like water supply, flood management and coastal protection. In some cases, this natural infrastructure may be even more cost effective than engineered solutions like water treatment plants or floodwalls, on top of the benefits to nature. The same goes with climate mitigation spending; protecting and restoring natural ecosystems not only protects biodiversity, it also sequesters greenhouse gases, helping prevent further climate change.
That’s not to suggest this is an easy task. The impact of Covid-19 – on our health, our social structures, our economies – is in many ways without recent precedent. Faced with such uncertainty, it’s tempting to choose familiar investments – to wish to restore our behaviours and economies to the way things were before this crisis. But going back to business as usual – at least when it comes to our relationship to the natural world – is something we cannot afford.
This is the time to invest in a new world that is, to quote IMF Managing Director Kristalina Georgieva, “greener, smarter, and fairer.”
How governments structure and deploy their stimulus packages over the course of the next year could very well determine whether we double-down on the same activities that are polluting our air and water, undermining our food security, increasing our vulnerability to disease and accelerating climate change – or whether we choose a more sustainable path. This is truly the investment of our lifetime, and getting it wrong could impact the health of our planet and everyone on it.
More than ever, we need nature now.