The National Economic and Development Authority (NEDA) and the World Bank have partnered in a project that will assess the country’s wealth in terms of natural resources, an official of the World Bank (WB) said.
The “Philippines-Wealth Accounting and Valuation of Ecosystem Global Partnership Program” or Phil-WAVES is a global partnership led by the World Bank, which aims to promote sustainable development by ensuring that accounting for natural resources is mainstreamed into development planning.
The initiative under the program is to address a major limitation of the country’s gross domestic product (GDP) accounting, which is the poor representation of natural capital.
Natural capital includes resources such as minerals, agricultural land, and fisheries. It also includes ecosystems producing services that are often “invisible” to most people, such as air and water filtration, flood protection, and habitats for fisheries and wildlife.
“It is critical to think about the management of natural wealth in low-income countries like the Philippines,” Stefanie Sieber, environment economist at the World Bank said in a press briefing on Wednesday.
The World Bank said that natural capital is a critical asset, especially for low-income countries like the Philippines where it makes up a significant share, about a third, of total wealth.
The Phil-WAVES program includes the establishment of Natural Capital Accounting (NCA) in the Philippines, which will provide detailed statistics to better manage natural resources and ultimately ensure sustainable growth of the economy.
For its part, NEDA said that NCA can be a useful guide in the formulation of development plans and policies toward sustainable development.
“If we are able to measure changes in natural capital, that gives us an idea about sustainability of developments and design polices in order to address that,” NEDA Deputy Director General Emmanuel Esguerra said.
Esguerra noted that the other use of NCA is that it can inform the valuation of resources and measure their contribution to the economy in terms of the goals of poverty reduction and employment generation.
NCA can contribute toward improving or enhancing the reporting of the country’s performance based on monetary and physical flow, including the economic benefits of ecological services and the impact of economic activities on the environment, he added.
“Natural capital accounting can guide a resource-dependent and biodiversity-rich country like the Philippines in weighing the trade off of various development interventions using a perspective from sustainable development,” the NEDA official said.