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); 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 Schmidt (GIZ), Christina Seeberg-Elverfeldt (BMZ), Ashbindu Singh (EPI) Lars Soefstad (Supras Biz), 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 About the ELD Initiative The Economics of Land Degradation (ELD) economic incentives must take place within an Initiative is an international collaboration that enabling environment that includes the removal of provides a global assessment of the economics of cultural, environment, legal, social, and technical land degradation, and highlights the benefits of barriers, and also consider the need for equitable sustainable land management. Working with a distribution of the benefits of land amongst all team of scientists, practitioners, policy-/decision- stakeholders. Though there is a wide variety of makers, and all interested stakeholders, the possible methods, valuations, and approaches that Initiative endeavours to provide a scientifically may be available or appropriate, the ELD Initiative robust, politically relevant, and socio-economically promotes the use of the total economic value, considerate approach that is economically viable achieved through cost-benefit analyses, as this can and rewarding. Ensuring the implementation of provide broad and cohesive understanding of the more sustainable land management is of critical economics of land degradation. It is a method that importance considering the vast environmental is generally accepted by governments and others and socio-economic challenges we are collectively as a decision-making tool, and applying other facing – from food, water, and energy security and tools may require a fundamental change existing malnutrition, to climate change, a burgeoning systems. To this end, the ELD Initiative operates global population, and reduction in biodiversity, under the following vision and mission statement, ecosystems, and ecosystem services. with a structure outlined in the organigram: Understanding the cost of inaction and beneftis of action are important in order for all stakeholders to ELD Initiative: Vision be able to make sound, informed decisions about the amount and type of investments in land they To transform global understanding of the value of make. Even though techniques for sustainable land land and to create awareness of the economic case management are known, many barriers remain for sustainable land management in preventing and the financial and economic aspects are often loss of natural capital, preserving ecosystem put forward as primary obstacles. If the full value services, combatting climate change, and in of land is not understood by all stakeholders, it addressing food, energy and water security. may not be sustainable managed, leaving future generations with diminished choices and options to secure human and environmental well-being. ELD Initiative: Mission Statement A better understanding of the economic value of land will also help correct the imbalance that can Through an open inter-disciplinary partnership: occur between the financial value of land and its economic value. For instance, land speculation ❚ We develop a holistic framework for the and land grabbing are often separated from the consideration of the economic values of land in actual economic value that can be obtained from political decision-making processes; land and its provisioning services. This divergence ❚ We compile and build a compelling economic is likely to widen as land scarcity increases and case for benefits derived from the sustainable land becomes increasingly seen as a ‘commodity’. management of land and soil on a global and Economic values can provide a common language local scale; to help entities decide between alternative land ❚ We estimate the economic benefits derived uses, set up new markets related to environmental from adopting sustainable land management quality, and reach the goal of land degradation practices and compare them to the costs of neutrality. It should also be noted that the resulting these practices; 1 ❚ We sharpen awareness of the value of land and related ecosystem services; ❚ We will propose effective solutions, policies and activities to reduce land degradation, mitigate climate change and deliver food, energy, and water security worldwide Economics of Land Degradation (ELD) Initative Governance Structure Steering Group Policy Partnership Science Partnership Supporting Partners ELD Secretatiat Supporting Partners Working Groups Ministries Civil Society Reports & Outputs and Scientific Networks targeting: Economic Options Development Private Valuation and Pathways Banks Sector ❚ Scientific Communities Case of Options for Action ❚ Political Decision-Makers Studies ❚ Private Sector Individual Other Data and Experts Institutions Methodology 2 THE VALUE OF LAND Acronyms and abbreviations CBA Cost benefit analysis DLDD Desertification, land degradation, and drought DPSIR Driver-pressure-state-impact-response framework ESV Ecosystem service values EU European Union FAO Food and Agriculture Organization of the United Nations LDN Land degradation neutrality GDP Gross domestic product GEF Global Environment Facility GIZ Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH GM Global Mechanism of the UNCCD HANPP Human appropriation of net primary productivity LAC Latin America and the Caribbean MCDA Multi-criteria decision analysis MDG Millennium Development Goals MOOC Massive Open Online Course NAP National action plan NDVI Normalized Difference Vegetation Index NGO Non-governmental organisation NPP Net primary production NPV Net present value OSLO Offering Sustainable Land use Options Consortium PES Payment for ecosystem services PPP Purchasing power parity SDG Sustainable Development Goals SLM Sustainable land management TEV Total Economic Value UK United Kingdom UNCCD United Nations Convention to Combat Desertification UNDP United Nations Development Programme UNFCCC United Nations Framework Convention on Climate Change UNGA United Nations General Assembly USD United States Dollar USA United States of America USPED Unit Stream-Power based Erosion Deposition WBCSD World Business Council on Sustainable Development WOCAT World Overview of Conservation Approaches and Techniques WTO World Trade Organization * Editor’s note: Acronyms and abbreviations are used