Habitats Value Greater if Untouched

Exploitation costs the Earth

Saving natural resources saves money. 9 August 2002 TOM CLARKE

In terms of hard cash, natural habitats are worth far more if left intact than if they are exploited, a new report shows. This is true even if the converted habitat brings apparent economic gains.

In net terms, every year's loss of natural habitat from practices such as logging and farming costs around $250 billion in each subsequent year, the report finds1.

"The economics are absolutely stark," says ecologist Andrew Balmford of the University of Cambridge, UK, who led the research team. "We thought that the numbers would favour conservation, but not by this much."

Natural goods

The new analysis places a value on the goods and services that nature provides, just like businesses provide goods and services to consumers. The ability of a forest to regulate climate by absorbing greenhouse gases, filtering water and trapping nutrients are natural services, and the goods include wild animals and plants that can be harvested sustainably.

A worldwide network of nature reserves both on land and at sea would cost about $45 billion a year to maintain, the report estimates. But the loss of natural goods and services if these habitats were wiped out is much more - between $4,400 billion and $5,200 billion.

The calculations make the reserves "a pretty good investment", says Robert Costanza, an ecological economist at the University of Maryland in Solomons and member of the research team.

Balmford's group based their analysis on five real-life examples: logging of Malaysian tropical forest, small-scale agriculture eating into Cameroon forests, destruction of mangrove swamp in Thailand for shrimp farming, drainage of Canadian marsh for agriculture, and demolition of Philippine coral reef by dynamite fishing.

For each one, they estimated the economic returns of exploitation, from the sale of timber or fish, for example, plus the jobs that the industry provides. They compared this with the value of goods and services from a relatively pristine neighbouring ecosystem.

But putting a value on natural resources is "extremely difficult", says Kevin Gaston, an ecologist at the University of Sheffield, UK; previous efforts by Costanza and others2 have been heavily criticized.

For example, there are few hard figures on which to base dollar estimates of nutrient cycling or carbon dioxide absorption. But even by the most conservative measures, the value of ecosystems is "indisputable", agrees Gaston.

Cashing in

Nature's worth is neglected, says Costanza, because it provides goods and services to the public as a whole, not to private interests. Generally speaking, economics only deals with the conventional market-place, made up of stocks, shares and services with clear cash value.

But there are simple steps that can help, the research team suggest. Taxes on polluting or environmentally damaging industries such as logging will help to transfer the cost of lost ecosystem goods and services to the conventional market. Carbon credits for less-polluting countries, currently under discussion to help address climate change, are another economic instrument that can help.

In the short term, the abolition of environmentally flawed subsidies would go a long way to addressing the problem, the researchers argue. These help industries such as agriculture or manufacturing to operate profitably in a region in which they would otherwise not be able to.

Sugar-cane farmers in Florida, for example, are supported by the government to allow them to compete with neighbouring Cuba. As a result, sugar-cane growing is unprofitable overall and has damaged the unique wetlands of the Florida everglades.

Worldwide, subsidies such as these cost governments around $950 billion each year - enough to pay for a worldwide network of nature reserves 20 times over.


Balmford, A. et al. Economic reasons for conserving wild nature. Science, 297, 950 - 953, (2002).

Costanza, R.The value of the world's ecosystem services and natural capital. Nature, 387, 253 - 260, (1997).

Nature News Service / Macmillan Magazines Ltd 2002

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