World needs paradigm shift in economic thinking for sustainable development, says landmark review by Indian-British economist

The world needs an urgent and radical change to the way economies operate to save nature and to avoid a catastrophic breakdown, a first-of-its-kind landmark review of biodiversity by an Indian-British economist has concluded

Vishal Gulati Feb 04, 2021

The world needs an urgent and radical change to the way economies operate to save nature and to avoid a catastrophic breakdown, a first-of-its-kind landmark review of biodiversity by an Indian-British economist has concluded.  The study by Prof Partha Dasgupta, a Cambridge University economist, says: "By taking seriously what we know about ecosystems and how they are affected by economic activity, the review presents a new way of approaching economic decision-making that accounts for nature as our most precious asset."

The 600-page report has been commissioned by the UK Treasury, marking the first that time a national finance ministry has authorised a full assessment of the economic importance of nature.

It acknowledges the world is losing nature at an unprecedented rate, destroying this precious and finite resource that will "limit our wealth and damage our health".

It's the first time a mainstream economist, with the backing of the UK government, discussed the need for urgent and radical reforms required to halt and reverse the erosion of natural assets.

"We need a paradigm shift: to radically rethink how we think, act and measure economic success e.g. moving beyond GDP as a benchmark for prosperity, ensuring we place nature at the heart of our economic decision making," said Dasgupta.

"We can orient our economies from extractive to restorative systems that sustain our underlying natural wealth and assets, and at the same time create jobs, protect our health and well-being now and in the future.

"This will also help us achieve wider societal goals, including tackling climate change, and alleviating poverty," he said.

The review said two UN conferences this year -- on biodiversity and climate change -- provided opportunities for the international community to rethink an approach that has seen a 40 per cent plunge in the stocks of natural capital per head between 1992 and 2014.

UK Prime Minister Boris Johnson said on the review that 2021 is critical in determining whether "we can stop and reverse the concerning trend of fast-declining biodiversity".

"I welcome Professor Dasgupta's Review, which makes clear that protecting and enhancing nature needs more than good intentions -- it requires concerted, coordinated action.

"As co-host of COP26 (UN climate summit) and President of this year's G7, we are going to make sure the natural world stays right at the top of the global agenda. And we will be leading by example here at home as we build back greener from the pandemic through my 10-point plan," said Johnson.

British broadcaster and natural historian, David Attenborough said: "This comprehensive and immensely important report shows us how by bringing economics and ecology face to face, we can help to save the natural world and in doing so save ourselves."

The global review on the Economics of Biodiversity launched formally on February 2, finds that humanity has collectively mismanaged its global portfolio of assets, meaning the demands on nature far exceed its capacity to supply the goods and services "we all rely on".

Its publication comes ahead of COP15 for biological diversity, where new long-term international targets for addressing biodiversity loss are expected to be agreed; and COP26 for climate change, where nature and nature-based solutions to climate change are expected to play a prominent role.

Responding to the Dasgupta review, Christiana Figueres, former UNFCCC Executive Secretary, said: "It is a compelling example of the leadership we need from government and the world's leading experts on how to address the interrelated crises of nature and climate.

"The review makes it clear that it is less costly to conserve nature than to restore it once it is damaged or degraded and provides the economic rationale for expanding and improving the management of protected areas. We can translate this idea into action by protecting 30 per cent of the planet by 2030."

The report said humanity must ensure its demands on nature do not exceed its sustainable supply and must increase the global supply of natural assets relative to their current level.

For example, expanding and improving management of Protected Areas; increasing investment in nature-based solutions; and deploying policies that discourage damaging forms of consumption and production.

It said almost all governments were exacerbating the biodiversity crisis by paying people more to exploit nature than to protect it.

A conservative estimate of the global cost of subsidies that damage nature was about $4 trillion to $6 trillion a year, it said.

"Humanity faces an urgent choice. Continuing down our current path presents extreme risks and uncertainty for our economies," the review said.

Brian O'Donnell, Director for Campaign for Nature, told IANS that the review is the most comprehensive economic case for a new path forward ever compiled.

"Now that we have entered a climate and ecological emergency, it is urgent that we update our economic systems at all levels to fully include nature."


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