Financial Impact From Deforestation “Dwarfs” Failing Banks Says New Study

Meg Hamill — Fri, 10 Oct 2008 03:23:20 +0000

The world’s economy is suffering more from the loss of forests than from the current crisis on Wall Street, according to a new EU-commissioned study.

The study says that the cost of deforestation annually is between $2 and $5 trillion dollars. These numbers were arrived at after researchers put value on, and then added together, the many ways in which forests “work” for us, including absorbing CO2 from the air, and providing potable water.

The idea behind the study is that as forests disappear, the natural world no longer provides services which it used to provide for free.

So, the human economic system must step in and find a way to provide these same services, for example through building reservoirs or building infrastructure to catch carbon dioxide.

“Whereas Wall Street by various calculations has to date lost, within the financial sector, $1-$1.5 trillion, the reality is that at today’s rate we are losing natural capital at least between $2-$5 trillion every year,” Pavan Sukhdev, who led the study, told the BBC.

The review is called The Economics of Ecosystems and Biodiversity (Teeb), and was initiated by Germany, although the European Commission provided the funding.

Green Options » teeb

Financial Impact From Deforestation “Dwarfs” Failing Banks Says New Study

The world’s economy is suffering more from the loss of forests than from the current crisis on Wall Street, according to a new EU-commissioned study.