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The Value of Land

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The Value of Land THE ECONOMICS OF LAND DEGRADATION The Value of Land Prosperous lands and positive rewards through sustainable land management www.eld-initiative.org Editor and coordinator: Naomi Stewart (UNU-INWEH) With the support of: Hannes Etter (GIZ), Nicola Favretto (UNU-INWEH), Tobias Gerhartsreiter (GIZ), Mark Schauer (GIZ), and Richard Thomas (ICARDA) Report Reviewers: Maria Brockhaus (CIFOR), Martin Dallimer (University of Leeds), and Emily McKenzie (WWF) This ELD report was published with the support of the partner organisations of the ELD Initiative and Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ). Photography: Clemens Bergmann/GIZ (pg. 93); Hannes Etter (pg. 29, 37, 109); Jiang Gaoming (pg. 46); Andreas König/GIZ (pg. 70);Tesfaya Mebrahtu/GIZ (pg. 71); Ursula Meissner/GIZ (pg. 45); Friederike Mikulcak (pg. 41, 50, 122, 127); Mark Schauer (pg. 67); Naomi Stewart (pg. 14, 61, 76); and Richard Thomas (pg. 32) Visual concept: MediaCompany, Bonn Office Layout: kippconcept GmbH, Bonn ISBN: 978-92-808-6061-0 For further information and feedback please contact: ELD Secretariat [email protected] Mark Schauer c/o Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH Friedrich-Ebert-Allee 36 53113 Bonn, Germany Suggested citation: ELD Initiative (2015). The value of land: Prosperous lands and positive rewards through sustainable land management. Available from www.eld-initiative.org. II The Value of Land: ELD Main Report Prosperous lands and positive rewards through sustainable land management September 2015 www.eld-initiative.org Acknowledgments: In addition all of the authors listed by chapter who worked in a collaborative process throughout the writing process in various capacities, the ELD Initiative would like to acknowledge a broad network of experts, practitioners, and partners who have contributed in time, advice, and expertise. This includes non-exhaustively and in alphabetical order: Zafar Adeel (UNU-INWEH), Eugene Apindi (EPI), Louise Baker (UNCCD), Mauricio Gonzalez Chang (Lincoln University), Andrew Chilombo (GEF), Sasha Courville (National Australia Bank), Tommy Dalgaard (Aarhus University), Estelle Dominati (Agresearch), Waltraud Ederer (GIZ), Tobias Gerhartsreiter (GIZ), Matthew Graham (Environment Canada), Anne Juepner (UNDP), Utchang Kang (UNCCD), Niko Langhammer (GIZ), Pushpam Kumar (UNEP), Eric Mungatana (University of Pretoria), Sarah Odera (GIZ/SEI Africa), Sue Ogilvy (Australia National University), Carly Popenko (UNU-INWEH), Luciana Porfirio (Australia National University), Simone Quatrini (Global Mechanism of the UNCCD), Nazmun Ratna (Lincoln University), Uriel Safriel (UNCCD-SPI), Harpinder Sandhu (Flinders University), Sascha Schmid (GIZ), Christina Seeberg-Elverfeldt (BMZ), Ashbindu Singh (EPI), Lars Soeftestad (Supras & CBNRM Networking), Jens-Christian Svenning (Aarhus University), Mesfin Tilahun (Norwegian University of Life Sciences/ Mekelle University), Graham Mark Turner (Australia National University), Katrine Grace Turner (Aarhus University), Nathan S. Upham (Yale University), Yann-David Varennes (Lincoln University), Anjana Varma (UNEP), Alexey Voinov (International Institute for Geo-information Science and Earth Observatory), Aaron Vuola (UNEP), Patrick Wegerdt (European Commission), Stephen Wratten (Lincoln University), and Zinta Zommers (UNEP). IV THE VALUE OF LAND Foreword In too many daily decisions, the difference between as well as supporting the G7 commitment to aim price and value is ignored. We have, for example, to lift 500 million people in developing countries consistently under-valued finite natural resources out of hunger and malnutrition by 2030. The like the land. The price of land on the global continued availability of productive land and soil market is often far below its real value to society. would also offer significant co-benefits measurable As a result of these economic signals, we have in economic terms. An ELD study conducted across extracted too much from the land and degraded 42 countries in Africa found that taking action on this most precious of assets to a dangerous extent. soil erosion over 105 million hectares would save Worldwide, 52 per cent of land used for agriculture up to USD 62.4 billion in net present value over the is moderately or severely affected by land and soil next 15 years. degradation. The phenomenon is widespread and occurs in all regions. Ecosystem service losses Adopting sustainable land management could from land degradation cost up to USD 10.6 trillion deliver up to USD 1.4 trillion in increased crop per year or USD 870 to 1,450 per person within the production. Cost-effective carbon storage, whereby same time. Everyone on earth suffers indirectly – carbon stocks in land and soil are enhanced, can globally, 1.4 billion people are directly impacted by create value up to USD 480 billion and increase land degradation. food and water security. SLM measures increase the resilience of people and ecosystems to food Increasing our understanding of the true economic price volatility or to climate shocks with significant value of land to society and aligning our policy economic implications such as drought and to that new reality will be critical. With the flood. Supporting SLM can thus make significant population of the world forecast to expand to contributions to climate change adaptation and at least 9.7 billion people by 2050, pressures on mitigation and, ultimately, to the goal of United food, water and energy supply will mount. With Nations Framework Convention on Climate Change growing competition over a declining resource (UNFCCC) to keep the increase in global average base, compounded by the accelerating impacts of temperature below 2 °C. a changing climate, instability and even conflict will accelerate. Going far beyond traditional To deliver on these opportunities, this ELD environmental or agricultural considerations, report calls for bold policy decisions. Supporting difficult trade-offs and access to finite natural economic, enabling and institutional conditions resources are set to be key strategic policy issues will be needed for the uptake of SLM. From in the coming decades. Failure to understand what subsidy reform to the elimination of perverse we get from the land means the price to be paid incentives and the development of new markets in terms of future uncertainty and vulnerability for different ecosystem services, ELD partners will be huge. The report highlights that ELD has believe robust economic valuation methodologies estimated lost value from land use change and will help decision makers take the decisions land degradation at 10 to 17 percent of current that are urgently needed for the benefit of their global GDP annually. communities. Those that do take action will leverage the huge opportunities that exist, such The ELD Initiative has demonstrated however as securing high rates of return on investment that sustainable land management (SLM) can be from ecosystem rehabilitation and restoration, profitable at all scales and within a relatively short for example. This is not something that the public time horizon. A concerted effort to scale up SLM sector can do alone. Stakeholder engagement and would certainly help achieve a number of the partnerships should be fostered and investments critical post-2015 Sustainable Development Goals, by the private sector encouraged. Partnerships for V the land and investments in the future health of the global understanding of the value of land the planet are economically rewarding across all and improve awareness of the economic case for sectors. sustainable land management in preventing loss of natural capital, preserving ecosystem services, With these combined efforts by the ELD network combatting climate change and addressing food, of partners, we want to make a contribution to energy, and water security. Dr. Gerd Müller Daniel Calleja Dr. Shin Won-Sop Monique Barbut Minister Director-General Minister Executive Secretary Federal Ministry of Environment Korea Forest Service United Nations Economic Cooperation European Commission Republic of Korea Convention to Combat and Development of Desertification Germany VI THE VALUE OF LAND About the ELD Initiative The Economics of Land Degradation (ELD) incentives must take place within an enabling Initiative is an international collaboration that environment that includes the removal of cultural, provides a global assessment of the economics of environmental, legal, social, and technical barriers, land degradation, and highlights the benefits of and also consider the need for equitable distribution sustainable land management. Working with a of the benefits of land amongst all stakeholders. team of scientists, practitioners, policy-/decision- Though there is a wide variety of possible methods, makers, and all interested stakeholders, the valuations, and approaches that may be available Initiative endeavours to provide a scientifically or appropriate, the ELD Initiative promotes the robust, politically relevant, and socio-economically use of the total economic value, achieved through considerate approach that is economically viable cost-benefit analyses, as this can provide broad and and rewarding. Ensuring the implementation of cohesive understanding of the economics of land more sustainable land management is of critical degradation. It is a method that is generally accepted importance considering the vast environmental
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