For every euro spent on land and forests, we gain at least 7
Environment — di Valentina Neri
Restoring land and forests means (also) growing the global economy. Finding the resources is not easy, but there are five paths to follow.
For every euro spent on land and forests, we gain at least 7
Restoring land and forests means (also) growing the global economy. Finding the resources is not easy, but there are five paths to follow.
Restoring land and saving forests is a tonic for the health of the planet — that much is beyond question. But there is another aspect that is almost never highlighted: it is also good business, in the economic sense of the word. Academic research, reported by the World Resources Institute, goes as far as calculating the ratio between costs and returns, and the conclusions are striking: for every dollar invested in restoring a piece of land or a forest, between 7 and 30 are generated in economic benefits. Benefits such as, for example, the storage of CO2 emissions, increased food production, and improved water quality. On the other hand, every year deforestation and soil degradation cost us 6,300 billion dollars in lost ecosystem services: we are talking about 8.3 per cent of global GDP going literally up in smoke.
If saving forests and soil is such a profitable endeavour, it is worth investing capital in it. And doing so quickly, and in a structural way. The Bonn Challenge, launched in 2011, sets the goal of restoring 350 million hectares of land and forests by 2030.
39 states have formally pledged their commitment and new ones are added to the list every year. Only by managing to attract financing will they be able to turn these statements of intent into reality. But how? These are the issues at the heart of the new report by the World Resources Institute, entitled Roots of Prosperity, which addresses governments directly and suggests they act on five different fronts.
Read also: A standing ovation for those who defend the lungs of the Planet, thanks to Foreste in piedi
Monetising environmental and social outcomes
The first step is to translate environmental and social outcomes into figures, into balance-sheet entries. One possibility, which has been much debated of late, is to draw on a carbon pricing system, using its revenues to combat climate change, to save forests and to restore land.
Directing public incentives correctly
Public incentives must make saving forests and land more advantageous than destroying them. In Costa Rica, for example, the government imposed a tax on fossil fuels whose revenues are reinvested in reforestation and land conservation. The results? Forest cover grew from 29 per cent in 1991 to 54 per cent in 2015, and ecotourism today accounts for 5.8 per cent of GDP.
RELEASE: WRI Report: Governments can unlock billions in finance to restore lands and livelihoods ow.ly/Y50x30hjVgO @GlobalLF #GLF2017 #thinklandscape @AndrewSteerWRI @NaokoIshiiGEF @FelipeCalderon @SofiaFaruqi @theGEF
Providing guarantees to investors
If private capital does not flow spontaneously towards land and forest restoration activities, it is because this is a fairly new area that can appear risky to investors. The role of the state, at this point, is to reduce these risks — for example through tax incentives or guarantee mechanisms. As does the Multilateral Investment Guarantee Agency of the World Bank, which provided political-risk insurance to EcoPlanet Bamboo, which is engaged in converting degraded land in Nicaragua into certified bamboo plantations.
Not confining projects within the boundaries of a single body
In several countries the task of safeguarding and restoring land and forests is relegated to the Ministry of the Environment, which often has a tight budget. But if the impact is so wide-ranging and tangible, it is worth making a qualitative leap. In Ethiopia, for example, all major government agencies are involved in the Crge (Climate Resilient Green Economy) strategy, which also includes land restoration projects. The African nation, as part of the Bonn Challenge, committed to restoring 15 million hectares of land by 2020; and it was the most ambitious among the members of the Afr100 initiative, which aims to restore 100 million hectares across Africa by 2030.
Producing data and economic analyses
When it comes to investment, finally, numbers are essential. Models of analysis are needed that allow investors to make purely economic assessments of the impact (in the short, medium and long term) of the individual initiatives they are called upon to support. Only in this way can they establish, with data in hand, which specific projects to invest their money in.