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29 Oct, 2007

GEO Report Seeks to Assess Monetary Value of Biodiversity

One groundbreaking aspect of the Global Environment Outlook 2007 issued last week is an attempt to estimate the monetary “value” of biodiversity. In this context, the value of coral reefs for fisheries and tourism is valued at US$30 billion/year, and the value of the herbal medicine market at roughly US$43 billion in 2001 figures.

Although such estimates are often attempted at local levels, expanding the effort to a global level helps to significantly inflate the figure, thus enhancing the “shock value” of the potential damage and giving it a greater sense of priority.

The authors of the Global Environment Outlook are clearly hoping that if estimating the economic value of travel & tourism as a job-creator and foreign exchange earner has helped policy-makers create the conditions for generating the phenomenal tourism growth in the last few decades, the same can be done by putting an estimate on the value of biodiversity and its value to tourism.

Says the report, “The contributions of biodiversity-dependent ecosystem services to national economies are substantial. The science of valuation of ecosystem services is new, and still developing basic conceptual and methodological rigour and agreement, but it has already been very instructive, since the value of such services is generally ignored or underestimated at decision and policy making levels.

“Identifying economic values of ecosystem services, together with the notions of intrinsic value and other factors, will assist significantly in future decisions relating to trade-offs in ecosystem management.”

Citing one example, the report says that the global net value of coral reefs relating to fisheries, coastal protection, tourism and biodiversity, is estimated to total US$29.8 billion/year. It cites the Caribbean, a popular tourist region, where nearly two-thirds of coral reefs are reported to be threatened by human activities.

The report also notes that countries are attempting new ways of raising revenues for environmental protection.

For example, it says, “the Protected Areas Conservation Trust in Belize, in Central America, receives most of its revenue from an airport tax of about US$3.75, paid by all visitors upon departure, together with a 20 per cent commission on cruise ship passenger fees. The British overseas island territory of Turks and Caicos designates 1 per cent of a 9 per cent hotel tax to support the maintenance and protection of the country’s protected areas.”

Referring to these as “green taxes,” the report says that although they are opposed by industry interest groups, they are being explored as part of the pressures being placed on the world’s major polluters and environmental destroyers. And governments are “gaining experience in implementing them.”

At the same time, it says, “Environmental degradation due to development raises deep ethical questions that go beyond economic cost-benefit ratios.”

Says the report, “The question of justice is perhaps the greatest moral question emerging in relation to environmental change and sustainable development. Growing evidence indicates that the burden of environmental change is falling far from the greatest consumers of environmental resources, who experience the benefits of development.

“Often, people living in poverty in the developing world, suffer the negative effects of environmental degradation. Furthermore, costs of environmental degradation will be experienced by humankind in future generations. Profound ethical questions are raised when benefits are extracted from the environment by those who do not bear the burden.”

Both tourism and its first-cousin, the air transport industry, are recognised for their economic benefits but criticised for not doing enough on the ecological front.

The report says tourism is an economic mainstay in many parts of the world, especially island nations such as the Seychelles as well as the Mediterranean coastal areas.

At the same time, it cites the urban sprawl of Las Vegas, “the fastest growing metropolitan area in the United States,” a reference that may soon be applicable to Singapore and Macau as they seek to develop their gaming industries on the Las Vegas model.

Says the report, “As the (Las Vegas) gaming and tourism industry blossomed, so has the city’s population. In 1985, Las Vegas was home to 557 000 people, and was the 66th largest metropolitan area in the United States.

In 2004, the Las Vegas-Paradise area was ranked 32nd in size, with a permanent population nearing 1.7 million. According to one estimate, it may double by 2015. Population growth has put a strain on water supplies. Satellite imagery of Las Vegas provides a dramatic illustration of the spatial patterns and rates of change resulting from the city’s urban sprawl.”

Another example is the state of Quintana Roo in Mexico which is experiencing a significant growth in tourism infrastructure all along the Caribbean coast.

“The conversion of mangrove forest into beachfront tourist resorts along the Mayan Riviera, south of Cancun, has left coastlines vulnerable. Playa del Carmen, at 14 per cent, has the fastest growth in tourism infrastructure in Mexico. Threats to the aquifers come from increasing water use, of which 99 per cent is withdrawn from groundwater, and wastewater disposal,” the report says.

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