Destruction/Development: The Wealth of Natural Capital…

The IREX Alternative Media Project organized a two-day seminar at American University of Armenia on “Advanced Coverage of Environmental Issues” for 14 journalists from various regions of Armenia.

The program was led by Leah Kohlenberg and included presentations on Bird Conservation Studies by Karen Aghababyan (Acopian Center for Conservation Learning), Trash and Recycling by Lilik Simonyan (Women for Health and Healthy Environment), Tree Planting Programs by Bella Avetisyan (Armenia Tree Project), National Parks by Siranush Galstyan and Artur Khoyetsyan (World Wildlife Fund).

The second day featured presentations on Wildflowers by Anna Asatryan (Institute of Botany), Deforestation by Hovik Sayadyan (State Agrarian University), and Trash and Recycling by Helmut Bernt (GTZ). The International Research and Exchanges Board (IREX) is an international organization providing programs to improve the quality of education, strengthen independent media, and foster civil society.

IREX will coordinate the work of the journalists to publish a regional supplement related to the issues presented at the seminar in time for World Environment Day in June. I was invited to discuss the topic of Sustainable Development and “The Wealth of Natural Capital,” and the following is an overview of the concepts presented.

The benefits people obtain from ecosystems include provisioning services such as food, water, and timber; regulating services that affect climate, floods, and water quality; cultural services that provide recreational, aesthetic, and spiritual benefits; and supporting services such as soil formation, carbon sequestration, and nutrient cycling. The Millennium Ecosystem Assessment concluded that non-market ecosystem benefits are often more valuable than market benefits. “The value of managing ecosystems sustainably is often higher than the value associated with the conversion of the ecosystem through farming, logging, or other intensive uses,” noted the influential report.

In addition, The Economics of Ecosystems and Biodiversity study led by Deutsche Bank managing director Pavan Sukhdev has shown that the value of environmental services lost every year is greater in magnitude than the current global financial crisis. “Whereas Wall Street by various calculations has to date lost, within the financial sector, $1-1.5 trillion, the reality is that at today’s rate we are losing natural capital [from global deforestation] at least between $2-5 trillion every year,” noted Sukhdev on the sidelines of the IUCN Congress in Oct. 2008.

I presented case studies that demonstrate the economic value of environmental services, as examples that could be replicated by professional, industry, and public sector experts in Armenia. First, the Catskills watershed provides drinking water to New York and is the largest US surface water supply that is not mechanically filtered. In 1989, city officials were faced with an EPA order to build a filtration plant that might have cost $6-8 billion, and instead the city allocated $1.5 billion to create buffers of undeveloped land around the reservoirs, to let nature pay for its own conservation.

Second, a study by the Audubon Society and Gund Institute for Ecological Economics estimated that Massachusetts forests provide $2.9 million in environmental services each year. For example, conservation efforts protected forests around the Quabbin Reservoir, which provides 40 percent of the state’s drinking water. Because of the services provided by this forest buffer, taxpayers were exempted from financing a $750 million filtration plant. Third, a 1986 project analysis in the Philippines estimated that logging would generate gross revenues of $9.8 million over 10 years, while a corresponding increase in sedimentation would result in lost revenues of $8.1 million from fisheries and $19.3 million from tourism over same period. The results convinced the government to ban logging in the Bacuit Bay watershed and declare it a reserve.

“We cannot--and should not--put a brake on the legitimate aspirations of countries and individuals for economic development,” concluded The Economics of Ecosystems and Biodiversity study initiated by the European Commission. “However, it is essential to ensure that such development takes proper account of the real value of natural ecosystems. This is central to economic and environmental management.”

Update: The IREX Core Media Support Program media supplement, Protecting Armenia's Environment, was published in July 2009.