The National Economic and Development Authority (NEDA) and the World Bank agreed that accounting for the value of natural resources could be a vital tool for efficient policy-making.
In his welcome remarks during the National Conference on Natural Capital Accounting (NCA) in Pasig City on Thursday, NEDA Secretary Ernesto Pernia expressed his optimism that the Philippine economy will continue to perform well after growing by 6.8 percent in 2016.
“This growth would not have been possible if not for the contribution of our natural resources; with their linkage to production, consumption and well-being,” he said.
As one of only 18 megadiverse countries in the world, the Philippines has a marine and terrestrial biodiversity that has provided all its needs, their uniqueness making the country one of the top destinations for ecotourism and research on genetic resources.
“However, it is also because we have been so blessed with natural resources that we tend to take for granted that they are finite. For decades, we have been relentlessly taxing our environment in response to increasing demands from development and economic activities, population expansion and external shocks,” he said.
“While numerous laws and regulations have been passed to protect, conserve, and sustain our natural resources, enforcement has been weak and inadequate,” he added.
Those reasons have compelled NEDA to support natural capital accounting (NCA): to help Filipinos understand the true economic value of natural resources, change the way people regard natural resources and ultimately improve their management and utilization, Pernia said.
“NCA initiatives in the Philippines have started since the 1990s. We jumped off from past initiatives with Wealth Accounting and Valuation of Ecosystem Services or WAVES, a global partnership led by the World Bank, which we took part in since 2010,” he said.
World Bank Country Director Mara Warwick said the people’s welfare is determined not only by the economy and society, but also by the ecosystems that support income, health and spiritual wellbeing.
“Economic and population pressures as well as climate change have dramatically contributed to the degradation of natural resources that comprise the earth’s ecosystem. This has significant negative consequences, particularly for the poor,” she said.
“At the core of this crisis is the systematic undervaluation of ecosystem services and the failure to account for their value in decision-making,” she added.
Warwick said gross domestic product is not a sufficient indicator of sustainability because it does not value the cost of environmental degradation or recognize how natural resources are being depleted in the course of meeting the demands of economic growth.
Neither does it recognize the needs of communities who depend on natural resources for day-to-day survival, she said.
“The solution is to incorporate the full value of ecosystem services and the benefits that humans derive from them into policymaking through natural capital accounting or the NCA,” she said.
“Natural capital accounting measures and values the links between the economy and the environment and allows us to analyze if we are using natural resources sustainably. It is a useful tool for national and local planning and public policy making,” she said.
NCA is all the more compelling because of two important global agenda: the Sustainable Development Goals and the Paris Agreement on Climate Change, both of which the Philippines has joined, Warwick noted.
The Sustainable Development Goals or the SDGs are a global agenda to eradicate poverty and put all countries on a trajectory of sustainable development by 2030.
The SDGs were formulated based on a definition of progress as a holistic measure of economic, social and physical well-being. Inherent in the SDGs is the link and interdependency between human well-being and healthy ecosystems.
Specifically, the SDGs call for ecosystem and biodiversity values to be integrated into national and local planning, development policy-making, poverty reduction strategies and accounts. The NCA will be an important tool worldwide for realizing this aim, Warwick said.
“The Paris Agreement on Climate Change forms the international basis on which countries will work to achieve the goal of limiting global temperature rise to within 2 degrees Celsius. Under this agreement, countries will regularly submit nationally determined contributions known as NDCs as their commitment towards achieving this goal,” she noted.
To satisfy the requirements of the Paris Agreement, standardized approaches are needed to monitor the interaction between the environment and the economy especially as countries transition to greener economies, she said.
This requires better and more integrated information on how the economy, environment and society interact, and this is another area in which NCA can play a vital role, Warwick said.
The Philippine Development Plan 2017-2022 acknowledges the range of products and services provided by ecosystems, and plans to institutionalize an ecosystem valuation and natural resource monitoring system, the WB official said.
It also envisages the development of a policy for Payments for Ecosystem Services.
“These actions will facilitate informed decision-making by political leaders and local communities; provide better alternatives and trade-offs in development planning; generate income and employment in the rural areas; and create wealth in a sustainable way for the nation,” she said.