Nature and Equity Investments: A Win-Win Strategy for the Economy

Nature is not only essential for human well-being, but also for economic prosperity, according to a new study.

The study shows that current trends in environmental degradation will lead to large economic losses in the coming decades, hitting the poorest countries hardest.

But there is hope: investing in nature can turn those losses into gains.

How nature benefits the economy

(Photo : Sean Gallup/Getty Images)

The study, published in the journal Proceedings of the National Academy of Sciences, developed a novel, global earth-economy model to capture interactions between the economy and the environment, as per Phys.org.

The model includes how nature benefits humans by pollinating crops, providing timber, storing carbon, and providing catch for marine fisheries, and how those benefits end up affecting the economy overall.

The researchers found that policy options for investing in nature resulted in annual gains of $100-350 billion (2014 USD), with the largest percentage increases in GDP occurring in low-income countries.

The policy options examined in this study include removing agricultural subsidies, financing research into improving crop yields, and international payments from wealthy countries to poorer countries to support conservation.

Continued trends in environmental degradation, on the other hand, would result in $75 billion in losses annually, with the low-income countries suffering from 0.2% losses in GDP year on year.

The researchers said that their model is the first of its kind to capture these complex interactions at a global scale and with enough spatial detail to understand the environmental consequences of economic activity.

They say that investing in nature does not stifle the economy, but boosts the economy, and that it is difficult to model those interactions until recently.

How nature benefits equity

The study also highlights how public goods and services provided by the environment are often most important for the world's poorest, who have less access to alternative options when the environment is degraded.

Consequently, investing in nature tends to make the world a more equitable place.

The researchers say that their findings have important implications for global efforts to achieve sustainable development goals, such as reducing poverty, improving health, and combating climate change.

They say that their study shows that investing in nature is not only good for biodiversity and ecosystems, but also for human welfare and economic growth.

They say that nature is not a luxury, but a necessity for human development. They also say that it is a huge achievement to demonstrate this with rigorous scientific evidence.

Also Read: Seven Sustainable Qualities Property Investors Should Seek Out When Investing

Examples of investing in nature

The study also provides some examples of how investing in nature can benefit different sectors and regions of the world. Some of these examples are:

•  Investing in renewables and energy efficiency can reduce greenhouse gas emissions and air pollution, while creating jobs and saving costs. For example, a World Bank project in India helped install solar panels on rooftops of public buildings, providing clean energy and reducing carbon footprint, as per UN Foundation.
•  Investing in clean transportation can improve mobility and accessibility, while reducing emissions and congestion. For example, a World Bank project in China supported the development of low-carbon buses and bike-sharing systems, improving urban transport and public health.
•  Investing in food and agriculture innovation can enhance food security and nutrition, while reducing land degradation and water use. For example, a World Bank project in Ethiopia helped farmers adopt climate-smart practices such as agroforestry and irrigation, increasing crop yields and incomes.
•  Investing in nature-based solutions can restore ecosystems and biodiversity, while providing multiple benefits such as carbon sequestration, flood protection, and tourism. For example, a World Bank project in Indonesia helped restore mangrove forests along the coast, protecting communities from storms and enhancing fisheries.
•  Investing in Indigenous communities can empower them to manage their lands and resources sustainably, while respecting their rights and cultures. For example, a World Bank project in Brazil supported Indigenous peoples to map their territories and monitor deforestation, strengthening their governance and conservation.
•  Investing in girls and women can improve their education and health outcomes, while reducing population pressure and empowering them to participate in decision-making. For example, a World Bank project in Bangladesh helped girls attend secondary school and delay marriage, improving their life chances and reducing fertility rates.
•  Investing in peace can prevent conflict and violence, which often have devastating impacts on people and nature. For example, a World Bank project in Colombia helped former combatants reintegrate into society and engage in productive activities such as ecotourism and agroforestry.

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