MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

WWF Conservation Strategy, Ecosystems’ Services, PES

and The Private Sector

By Pablo Gutman / WWF – MPONovember 2006

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

Two complementary Perspectives on the world’s environmental plight

THE ECOLOGICAL FOOT PRINT APPROACH: looks into people’s and countries’ consumption and the tall that this consumption puts on nature.

(See the WWF Living Planet 2006)

THE ECOSYSTEM SERVICE APPROACH: Looks to the flow of nature’s services, and how much they have been compromised by human use, abuse or neglect .

(See the 2005 Millennium Ecosystem Assessment)

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

Supporting ServicesSoil formation Nutrient cycling Primary production

Cultural ServicesSpiritual and religiousRecreation and

ecotourismAestheticInspirationalEducationalSense of placeCultural heritage

Regulating Services

Climate regulationDisease regulationWater regulationWater purificationPollination

Provisioning Services

FoodFresh waterFuel woodFiberBiochemicalsGenetic Resources

The Millennium Ecosystem Assessment looks to ES

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

The ME Assessment of Ecosystem Services trends

While provisioning of food and fibers have steadily gone up over the last hundred years, the flow of almost all other ecosystem services have gone down

“Across the range of biodiversity measures current rates of change and loss exceed those of historical past by several orders of magnitude and show no indication of slowing”

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

So, WWF conservation strategy attempts…

To increase the supply of ecosystem services

and

To reduce society’s ecological footprint

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

Some approaches to reduce society’s ecological footprint..

Increase efficiency Reuse, recycle, Move to renewable energy and organic productsChange lifestyles and consumption away form over-consumption and pollutionInternalize the bad: the polluter pays principleIn a nutshell an urban consumers and producers sustainable development agenda

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

Some approaches to increase the supply of ecosystem services

Set aside a sizable sample of world ecosystems (protected areas)Protect natures’ regeneration capacity (e.g. stop over-fishing)Ensure ecological flows (e.g. ecological river flows) onInternalize the good: the payment for ecosystem services principleIn a nutshell a rural sustainable development agenda

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

So, focusing on Ecosystem Services and PES approaches

They are not the whole solution, but could be an important tool to foster environmental conservation a tool that brings new economic incentives, markets, jobs and income opportunities to rural areas around the world

And businesses may have a lot to contribute to and benefit from it, as demanders of ES, as suppliers of ES and as market developers

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

Value-adding markets for ES

Consumers’ demand for goods and services that had embedded an ES component and pay a premium for it (e.g. ecotourism, green or organic food, certified wood products, etc)

People pay for the But also pay a plus forproduct the attached ES

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

Cost-saving markets for ES

Producers and consumers buy ES because it save them money (e.g. agricultural organic practices that are cheaper than the high input intensive ones)

The ES actually save costs

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

Regulation compliance markets for ES

Producers buy and sale ecosystem services to comply with regulations (e.g. carbon markets, environmental offset markets)

A market for stand-alone regulatory driven ES

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

Public procurement of ES

As in the caser of many other public goods (health, education, security) governments take the lead in procuring part of society’s demand for ecosystem services (e.g. part of biodiversity conservation, oceans, global commons)

Private procurement Can entail a lot of supply businesses

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

So, where do we stand with ES/PES?

At the very beginningWe have a really interesting product: Ecosystem ServicesBut the market for it is still very limitedAnd we are hoping that the business sector will help as develop the market for ES, both because it can be good for profits and because it can be good for social and environmental corporate responsibility

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

And what has WWF to offer? A World-wide network

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

Plus….

Global initiatives, on-the-ground actions, and many new ideas to pursue (some profiled in the materials distributed today)Human resources (over 5,000)A large constituency (over 5 million members)A recognize brandRecognition from, open dialogue and partnerships with major international national and local stakeholders

MACROECONOMICS FOR SUSTAINABLE DEVELOPMENT PROGRAM OFFICEM/P/O

So we see this meeting as an opportunity to engage

In a search for innovative approaches to the challenges of creating new market for ecosystem services, bothAt the global scale of world markets and international agendas and At the local level where ES and PES could deliver more nature, more income and more business opportunities.