Natural Capital in Dangerous Decline Across the Asia-Pacific

Andrew Burger

Across the Asia Pacific, degraded ecosystems send "natural capital" into a downward spiral. The impacts of this decline impact everyone, but none more than the region's rural and urban poor.

As removed as we have become from direct connections with natural ecosystems and the goods and services they provide, they remain the foundation upon which human economies, societies and nations are built and sustained. Research highlights from the Asian Development Bank (ADB) reveal that the degradation loss of natural ecosystems and natural resources across the Asia-Pacific region is taking a heavier and heavier toll economically and in terms of social and environmental health and quality with dire consequences in store.

So-called natural capital has been a driver of rapid economic growth in the Greater Mekong sub-region, accounting for anywhere from 20-55 percent of the total wealth of countries there. Revenues resulting from the inland Mekong River fishery, the world's largest, alone total as much as $3.9 billion, ADB highlights.  Furthermore, agriculture, including forestry, is the main source of employment in the sub-region.

Those ecosystems and others of critical importance across the Asia-Pacific region are being degraded and lost at faster rates and may never be restored, ADB warns. "Overexploitation of the region's forests, grassland, oceans, coasts, freshwater, and other ecosystems to meet increasing demand for food, energy, housing, and commodities such as palm oil, pulp, rubber, and timber has resulted in deforestation, land degradation, desertification, and biodiversity loss.

"The massive regional trade in wildlife and wildlife products for food, traditional medicines, ornaments and pets is leading to loss of species. Household hazardous waste, e-waste, and food waste are increasing and plastic waste and marine pollution is of urgent concern," writes Bruce Dunn, director of ADB's Environment and Safeguards, Sustainable Development and Climate Change Dept., and Cristina R. Velez, an ADB Knowledge and Communications Consultant.

The dangerous, worldwide decline in natural capital

The results from a landmark, global study the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES) Global Assessment on Biodiversity and Ecosystem Services, revealed that that the natural capital is in dangerous decline worldwide.

"The loss of species, ecosystems and genetic diversity is already a global and generational threat to human well-being. Protecting the invaluable contributions of nature to people will be the defining challenge of decades to come. Policies, efforts and actions - at every level - will only succeed, however, when based on the best knowledge and evidence. This is what the IPBES Global Assessment provides,"IPBES Chair Sir Robert Watson stated. 

Asia-Pacific's mixed "agro-ecosystems" represent 30 percent of the world’s agricultural land and 87 percent of the world’s small farms on which a wide range of native crops key to people's survival and livelihoods are grown. In addition, more than 50 percent of the worldwide marine and river fish catch and 89 percent of global aquaculture comes from the region.

Citing research studies, the authors highlight natural capital loss across river, oceans, and fisheries, in terms of biodiversity and species loss and climate impacts worldwide. Land degradation alone puts as many as "135 million people are at risk of distressed migration as a result of land degradation in the next 30 years," they highlight. In addition:

  • 60 percent of grasslands and more than 20 percent of deserts are degraded. Overgrazing by livestock, invasive species, or conversion to agriculture has resulted in rapid decline of native flora and fauna.
  • Over 400 million people in the People's Republic of China are affected by soil erosion, causing annual economic losses of $10 billion, while in India, reports of degradation have increased “by a factor of six.”
  • Southeast Asia showed a reduction of 12.9 percent in forest cover between 1990 and 2015 because of increasing exports of palm oil, pulp, rubber, and timber products.
  • By 2014, more than 1.5 billion hectares of the world’s natural ecosystems had been converted to croplands.

Far-reaching consequences

The degradation and loss of natural ecosystems erodes the basis for entire societies and economies, but it affects the indigenous and poor disproportionately, perpetuating a cycle of impoverishment. "Of the total population of 333 million people in the Greater Mekong Subregion (GMS), more than 60 million (mostly rural poor) depend directly on natural capital for their daily energy, food, water, and income needs.

Fisheries provide 47–80 percent of animal protein consumed in the GMS, and more than 80 percent of Cambodian and Lao PDR households depend on biomass for cooking and lighting," the ADB authors highlight.

Globally, it's estimated that nearly three quarters of the world’s poorest citizens depend directly on natural capital. Fifty percent are smallholder farmers, 20 percent are rural workers and 10 percent depend on herding, fishing and forestry.

"Land, water, marine,and soil degradation, consequently reduce fishing and agricultural yields, drastically lowering the earning capacity of groups," they point out.

In addition, nearly 200 million people directly depend on the forest for their non-timber forest products, medicine, food and fuel, as well as other subsistence needs. Furthermore, "90 percent of fisheries jobs across the region are small-scale, with millions of people working across the value chains."

The “GDP of the poor,” an indicator of household income in rural and natural asset–dependent communities, illustrates the significant dependence of rural poor on natural capital. In Indonesia, while agriculture, forestry, and fisheries have an aggregate value of 11 percent of GDP, but for poor households (99 million in total), this increases to 75 percent. In India it as much as 53 percent.

The region’s urban poor are also particularly vulnerable to the negative impacts of degraded natural capital in cities. Living in densely populated slums with no access to safe water and sanitation, exposed to air and water pollution, and often surrounded by hazardous wastes, they constantly face and suffer from health risks. As well, they are the most affected by climate impacts such as urban heat and flooding.

"The depletion and ultimate loss of natural capital can have far-reaching consequences to human health and well-being and pose fundamental threats to human security. It is therefore critical for countries in Asia and the Pacific to restore, protect, and sustainably manage their remaining natural capital stocks," Dunn and Velez say.