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Economics of Ecosystems and Biodiversity in Ag and Food

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The conference on Food Safety and Nutrition in 2050 – organised by Directorate-General for Health and Food Safety of the European Commission – provided an opportunity for dialogue among global stakeholders on the emerging challenges to the food chain and the role of future policy-making in addressing those challenges.

The conference also provided the opportunity to foster a dialogue on consumers' expectations for safe, nutritious, quality and sustainable food and the role of food science, technology and innovation in achieving them. Held on 17 July 2015 in Milan, Italy.

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Economics of Ecosystems and Biodiversity in Ag and Food

  1. 1. Towards a Global Study on The Economics of Ecosystems and Biodiversity in Agriculture and Food (TEEBAgFood) Alexander Müller, UNEP Geneva 17. July 2015 EXPO 2015 Milano
  2. 2. 7 8 8 9 9 8 10 11 21 23 23 49 66 75 85 82 79 77 63 49 35 20 8 -2 -9 -13 -20 0 20 40 60 80 100 0 2 4 6 8 10 12 14 16 1850 1900 1950 2000 2050 2100 Annual increments (millions) Total population (billions) Population growth to continue, but at a slower pace High variant low variant Source: UNPD, 2008
  3. 3. World Population Prospects – Change between 2010 and 2100 (millions)
  4. 4. ECONOMICS OF LAND DEGRADATION: THE COSTS OF NON-ACTION ARE HUGE 1. 24% of the world´s productive lands are degraded. 2. Annual economic losses due to deforestation and land degradation are estimated at 1.5-3.4 trillion Euro in 2008, equaling 3.3%-7.5% of the global GDP. 3. Up to1.5 billion people in all parts of the world are already directly affected.
  5. 5. Results Carbon footprint 5 Carbon footprint of food waste up to 3.3 Gt CO2 If food wastage was a country, it would rank as the 3rd top emitter. 0 1 2 3 4 5 6 7 8 GtonnesCO2eq. Total GHGs emissions excluding LULUCF Top 20 of countries (year 2005, WRI) vs. Food wastage Source for blue bars: WRI, 2012. Climate Analysis Indicators Tool. Available at: http://cait.wri.org.
  6. 6. The Economics of Ecosystems and Biodiversity in Agriculture and Food (TEEBAgFood) First Results from Studies on Palm Oil and Rice
  7. 7. GDP of the Poor Traditional measures of national income (GDP) measure the flow of goods and services. Could be misleading as indicators of societal progress because of the “invisibility” of many of nature’s values. TEEB reports present ‘GDP of the Poor’ as a new metric that integrates economic, environmental and social aspects, thereby indicating the vulnerability of the rural poor if valuable natural resources are lost. Ist has been estimated that biodiversity and ecosystem services account for between 40 to 90 per cent of the GDP of the Poor.
  8. 8. TEEB approach has three different levels of action: 1. Recognizing value – identifying the wide range of benefits in ecosystems, landscapes and biodiversity, such as provisioning, regulating, habitat/supporting and cultural services 2. Demonstrating value – using economic tools and methods to make nature’s services economically visible in order to support decision- makers wishing to assess the full costs and benefits of land-use change 3. Capturing value – incorporating ecosystem and biodiversity benefits into decision-making through incentives and price signals
  9. 9. No Commoditization of Nature Assigning an estimated value for a particular ecosystem service does not mean that this is ‘the price’; TEEB in no way supports the commoditization of nature.
  10. 10. TEEBAgFood Palm Oil Study Countries included within the materiality assessment
  11. 11. Interim findings from the TEEBAgFood palm oil study 1 Trucost (2015) assessed ‘natural capital’ and ‘social capital’ costs in the top eleven palm oil producing countries These costs were determined by evaluating three main criteria: (i)yield and conversion rate; (ii)quantity and type of inputs; and (iii)the monetary value per quantity of emissions.
  12. 12. Interim findings from the TEEBAgFood palm oil study 2 Palm oil is the world’s most consumed vegetable oil with over 56 million metric tons in 2013. Production expected to double over the next 40 years for use in food, cosmetics and biofuels. Palm oil production generates the following natural and social capital costs: •carbon emissions and their impact on global warming (58 per cent), •fertilizer application (23 per cent); •palm oil mill effluent emissions (12 per cent); •manufacturing of inputs (4 per cent); •and pesticide application (3 per cent).
  13. 13. Interim findings from the TEEBAgFood palm oil study 3 Interim valuation (not yet peer reviewed) In total, palm oil production in the top 11 producer countries generates natural and social capital costs of US $44 billion/a, ranging between US $271 and US $1,300 per ton, depending on the practices used and the agro-ecological conditions.
  14. 14. Interim findings from the TEEBAgFood palm oil study 4 The top two producing countries contribute 66 and 26 per cent (respectively) of the total costs (high production quantity and high intensity). Palm oil production in countries with significantly lower rates of peatland drainage and forest conversion is significantly less costly (difference of $563 per ton). Social capital costs in terms of human health, due to the high application of fertilizers coupled with poor access to safe drinking water, amount to roughly $533 per ton of palm oil produced. Please note that the results are preliminary and not yet peer reviewed.
  15. 15. TEEBAgFood: Integrated rice-fish systems* • The Pampangan swamp floodplain area in the Philippines is characterized by seasonal shift of aquatic and terrestrial environment. • During wet season the plain is covered by water of 1 – 4 meters depth, whereas during dry season the plain becomes dry land. * Muthmainnah, et al., 2015
  16. 16. Integrated rice-fish systems • Local people living around the swamp work as fishermen during wet season and as rice farmer during dry season. • The swamp is managed in integrated manner based on local wisdom. • During wet season, the water body is managed as a common property, where all community members are allowed to exploit fish resources. • During dry season, the permanent owners claim their plot of rice field to cultivate the rice. Philippines Vietnam
  17. 17. • The average of people gross income is IDR 15,000,000 per season from fisheries activity and IDR 11,000,000 per season from rice farming. • If the study had only focused on the commodity rice, the valuation of the rice agro-ecosystems would have missed a crucial livelihood component of the rural population – fishing. Integrated rice-fish farming YET STILL MORE THAN THAT….
  18. 18. …more than calories or dollars • Nutrition: protein, micro-nutrients, vitamin A; zinc; iron and calcium • Important source of nutrition and income for the landless poor. • Recreation WorldFish Center WE NEED TO VALUE THESE BENEFITS AND MAKE THEM VISIBLE!
  19. 19. Asian Food Regulation Information Service is a resource for the food industry. We have the largest database of Asian food regulations in the world – and it’s FREE to use. We publish a range of communication services (free and paid), list a very large number of food events and online educational webinars and continue to grow our Digital Library. Feel free to contact us anytime to talk about your specific requirements, offer comments, complaints or to compliment us. We look forward to hearing from you soon! www.asianfoodreg.com admin@asianfoodreg.com

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