MAJOR THERATS TO FOREST ECOSYSTEM: Putting a Price Tag on Nature’s Ecological Services

Currently, forest and other ecosystems are valued mostly for their economic services. But suppose we took into account the monetary value of the ecological services provided by forest (Figure1). In 1997, a team of ecologist, economics, and geographers estimated the monetary worth of the earth’s ecological services and the biological income they provide. They estimate the later to be at least $ 33.2 trillion per year close to the economic value of all of the goods and services produced throughout the world. The amount of money required to provide such interest income and thus estimated value of the world’s natural capital (would have to be at least $ 500 trillion) an average of about $ 73,500 for each person on earth!

According to this study, the world’s forests provide us with ecological services worth at least $ 4.7 trillion per year (hundreds of times more than their economic value. And these are very conservative estimates. Some researcher team’s estimates for forest are shown in Figure 2. Note that the collective estimated value of these ecosystem services is much greater than the value of timber and other raw materials extracted from forests. These researchers hope their estimates will alert people to three important facts: the earth’s ecosystem services are essential for all humans and their economies; their economic value is huge; and they are an ongoing source of ecological income, as long as they are used sustainably.

 However, unless estimated values of these ecological services are included in the market prices of goods and services, through market tools such as regulation, taxes, and subsidies that encourage protection of biodiversity, the world’s forests and other ecosystems will continue to be degraded.

                So, how should we manage and sustain forests? We can sustain forest by emphasizing the economic value of their ecological services, removing government subsidies that hasten their destruction, protecting old-growth forests, harvesting trees no faster than they are replenished and planting trees.

Critical Thinking

Some analysts believe that we should not try to put economic values on the world’s irreplaceable ecological services because their value is infinite. Do you agree with this view? Explain. What is the alternative?

By: Ardi J