The Economics of Ecosystem and Biodiversity

1. The are at least two research groups in Malaysia, that I know, that look into the economics of ecosystem and biodiversity. One in Universiti Putra Malaysia led by Assoc. Prof. Dr. Awang Noor Abdul Ghani and Prof. Dr. Shahwahid, both are forest economists and the other in Universiti Kebangsaan Malaysia led by Prof. Dr. Jamal Othman, an economist.

2. There is so much benefits that ecosystem biodiversity service could provide us and also the growing cost of biodiversity loss, not to mention also ecosystem degradation. There are studies elsewhere that are aimed to:
a) integrate ecological and economic knowledge to structure the evaluation of ecosystem services
b) address different ecosystem valuation methodologies
c) determine the economic costs of biodiversity decline and loss
d) raise public awareness of the impact on biodiversity and ecosystems

3. The challenge is really to manage our desire for food, energy, drugs and raw materials. while minimising adverse impacts on biodiversity and ecosystem service For instance it has been estimated that about USD3 trillion per year is lost as a result of defrestation and degradation. It is ironic that about USD 45 billions of the annual investment went into protected areas. It is thus estimated that some USD 5 trillion a year is needed to secure the delivery of ecosystem services.

4. When we prepared the National Biodiversity Policy document in 1998, we talked about the inclusion of sound ecosystem management and the inclusion of green capital in governmental and business accounting. However, that talk went on deaft ears.

5. I see this should be addressed at three levels. A policy toolkit is necessary to provide guidance for policy makers, coverig subsidies and incentives, environmental liability, new market structure, national income accounting, cost-benefit analysis etc

6. Secondaly, there is a need to create public awareness on the direct and indirect value o ecosystems and biodiversity and thirdly, it is imperative to mitigate or offset corporate impacts on ecosystems and biodiversity. There are many examples in the developed countries that showed successful business models that recognise the value of ecosystem services and biodiversity.