Lockdowns have highlighted our need for green spaces. Yet for all nature’s richness, its worth is rarely calculated in monetary terms.
Campaigners and statisticians plan to change that. UK government number crunchers this spring put a monetary value on the contribution of beaches, woodlands and the like to British tourism. Nature drove 8 per cent of outdoor leisure spending in 2019, totalling £12bn, they concluded.
Biodiversity can no longer be excluded from economic analysis, according to a separate government-commissioned study. The failure of politicians and economists to value species variety has contributed to its erosion. The UK’s per capita stock of “natural capital” declined in value by nearly 40 per cent in the 22 years to 2014.
Valuing nature is tough. Some deep greens believe nature is beyond price. Even proponents struggle to value assets whose perceived worth is much higher than their income streams. Many people feel mountain gorillas are valuable. Few pay to visit these rare apes in Rwanda. Measuring tangible benefits, such as water purification and pollination is easier.
There is another objection to pricing nature on the cost of transport, entry to wild areas and accommodation. Many people would be willing to pay far more than prices sometimes set with social equity in mind. Statisticians estimate this gap using the “travel cost method”. A study found it approached 1 per cent of Indian GDP for seaside visits there.
That creates scope to raise funds to preserve precious habitats, either through charitable appeals or pressure on governments.
As for eco-tourism itself, this has been growing partly because participants see it as a way to give biodiversity economic value. An east African with a job as a nature guide has a financial interest in resisting poaching, for example.
Eco-tourism is one of the businesses a new wave of “natural capital funds” are exploring. HSBC Pollination Climate Asset Management is set to launch its first such fund later this year. AXA Investment Managers and Lombard Odier have already launched funds aimed at protecting natural habitats.
But there is a big gap to fill. The difference between what is spent on conservation and what should be spent on it is $598bn-$824bn a year, according to research by The Nature Conservancy, a US non-profit, and others. You cannot manage what you have not measured. Nature should inspire statistics as well as sonnets.
The Lex team is interested in hearing more from readers. Should we set a price on nature? If so, how? Please tell us what you think in the comments section below.