Researchers in South Africa recently presented a report to the provincial government of the Western Cape Province, showing the cost to the economy of degraded ‘natural capital’ is estimated to be at least R4.5 billion per annum. And yet, in spite of how important healthy functioning ecosystems are to human welfare and the economy, the private sector does not invest much in restoring or conserving this natural capital.
The report, headed by the Environmental Policy Research Unit’s (EPRU’s) Dr Jane Turpie, at the University of Cape Town, lobbies government to create an enabling environment that mobilises and incentivised private sector investment in this area.
Natural capital is the term use to refer to the benefits to society or the economy gained from healthy, functioning ecosystems. These give a range of ‘goods’, ‘services’ and ‘attributes’ that generate value or support human welfare in some way or other.
While the ecosystem services of the Western Cape have been compromised by a range of threats, two priority areas emerge in this study where the biggest losses have occurred: fresh water systems, and marine fisheries.
Water losses linked to alien plant invasion are estimated to be about R1.29 billion per annum. This kind of infestation reduces the landscape’s capacity to improve water quality, reduce flooding and so forth, which are losses of ecosystem services estimated at over R2 billion per annum.
Meanwhile the depletion of fish stocks has cost the province’s fisheries an estimated R1.3 billion per annum, and the loss of estuary nurseries for fish is valued at about R0.7 billion per annum.
With significant investment, much of this value of lost natural capital could be restored, and new business opportunities generated in the process.
Turpie and colleagues show various ways in which the private sector can contribute to restoring and conserving natural capital, and how different tiers of government can smooth the way.