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teebweb.org
05.06.2013 Views

STRENGTHENING INDICATORS AND ACCOUNTING SYSTEMS FOR NATURAL CAPITAL A ‘beneficiary focus’ helps us to better recognise the human significance of observed losses of ecosystems and biodiversity. Moving beyond broad measures of income such as GDP to target the well-being of the poor is particularly relevant tor transitional economies as the key beneficiaries of forest biodiversity and ecosystem services are the rural poor and forest-dwellers. In this section, we advocate the need for an adapted measure of GDP – the ‘GDP of the Poor’ that can show the dependence of poor people on natural resources and the links between ecosystems and poverty (section 3.5.2). This takes the form of a three dimensional metric which integrates the economic, environmental and social aspects, thereby indicating the vulnerability of these sections of the population if valuable natural resources are lost (section 3.5.3). Once adjusted for equity, the real cost of loss of biodiversity is different – so this indicator could reflect the impact of loss in biodiversity to the ‘real income’ and well-being of the poor. 3.5.2 POVERTY AND BIODIVERSITY: FROM VICIOUS TO VIRTUOUS CIRCLE The links between poverty and biodiversity can be examined through the lenses of livelihoods, distribution, vulnerability and causality. From a livelihood perspective, abundant biodiversity and healthy ecosystems are important for food security, health, energy security, provision of clean water, social relations, freedom of choice and action. They provide the basic material for good life and sustainable livelihoods and guard against vulnerability (MA 2005). Treating these flows of value to society as externalities results in understating GDP as a measure of total income. In particular, this omission from national accounts of many ecosystem services and biodiversity values misstates the GDP of the Poor who are the key beneficiaries of such services (e.g. direct harvesting of food, fuelwood and non-timber forest products; indirect flows such as the flow of freshwater and nutrients from forests to aquifers and streams to their fields). The predominant economic impact of loss or denial of such inputs from nature is on the income security and well-being of the poor. An analysis of vulnerability leads to similar conclusions. Natural resources are of course used not only by the poor but by society at large – countries, companies and local communities. However, the vulnerability of different user groups to changes in biodiversity varies according to their income diversity, geographical location and cultural background, among other factors. Table 3.5 illustrates this by reference to end users of forest ecosystems in the state of Para, Brazil, showing their respective vulnerability to climate change and natural hazards. The highest vulnerability is found at the level of local communities in and near forests, largely due to their lack of mobility and access to resources. Poverty-environment linkages are multi-dimensional and context-specific, reflecting geographic location, scale and the economic, social and cultural characteristics of individuals, households and social groups (Duriappah 1997). “Poverty can be due to a range of lack of the various assets (and income flows derived from them): (a) natural resource assets; (b) human resource assets; (c) on-farm physical and financial assets; (d) off-farm physical and financial assets. A household might be well endowed in one asset but poor in another, and the type of poverty can influence the environment-poverty links” (Reardon and Vosti 1995). Duriappah (1997) identifies two kinds of poverty: exogenous (external to the group) and endogenous (internal to the community) when he notes that the root cause of environmental degradation is not only poverty but several other factors. Exogenous poverty – factors like greed, institutional and policy failures – leads to environmental degradation which in turn leads to endogenous poverty (e.g. due to degradation of natural assets). Services commonly affected by such degradation include depletion or degradation of water availability, water quality, forest biomass, soil fertility and topsoil as well as inclement micro-climates. The two types of poverty thus reinforce each other. Poverty, where it leads to degradation of natural capital to support needs, reduces the services generated by ecosystems which – with lack of investment resources – leads to more poverty and thus creates a vicious circle. TEEB FOR NATIONAL AND INTERNATIONAL POLICY MAKERS - CHAPTER 3: PAGE 34

STRENGTHENING INDICATORS AND ACCOUNTING SYSTEMS FOR NATURAL CAPITAL An example of these linkages (see Box 3.5) is from Haiti, the poorest country in the Western Hemisphere with 65% of its people surviving on less than US$1 a day. Deforestation was shown to have led to much higher vulnerability and loss of life (compared to the neighbouring Dominican Republic) as a result of a cyclone which affected both countries. Natural resource degradation can thus aggravate loss of natural resources because of the poverty trap. It is essential to break the vicious circle and create a virtuous circle. A proactive strategy of investment in natural capital is needed to help increase the generation of ecosystem services. Table 3.5: Illustration of differences in forest dependence, vulnerability to climate change impacts and factors affecting the vulnerability of different forest user groups for the State of Para, Brazil TEEB FOR NATIONAL AND INTERNATIONAL POLICY MAKERS - CHAPTER 3: PAGE 35 Source: Louman et al. 2009

STRENGTHENING INDICATORS AND ACCOUNTING SYSTEMS FOR NATURAL CAPITAL<br />

An example of these linkages (see Box 3.5) is from<br />

Haiti, the poorest country in the Western Hemisphere<br />

with 65% of its people surviving on less than US$1 a<br />

day. Deforestation was shown to have led to much<br />

higher vulnerability and loss of life (compared to the<br />

neighbouring Dominican Republic) as a result of a<br />

cyclone which affected both countries.<br />

Natural resource degradation can thus aggravate<br />

loss of natural resources because of the<br />

poverty trap. It is essential to break the vicious<br />

circle and create a virtuous circle. A proactive<br />

strategy of investment in natural capital is needed to<br />

help increase the generation of ecosystem services.<br />

Table 3.5: Illustration of differences in forest dependence, vulnerability to climate change impacts<br />

and factors affecting the vulnerability of different forest user groups for the State of Para, Brazil<br />

<strong>TEEB</strong> FOR NATIONAL AND INTERNATIONAL POLICY MAKERS - CHAPTER 3: PAGE 35<br />

Source: Louman et al. 2009

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