Natural capital accounting - Key for sustainable natural resource management
Dr Eric Twum
Opinion
Natural resources in diverse forms are abundant across the entire Ghanaian landscape. These resources which constitute natural capital provide numerous ecosystem services (water cycling, temperature regulation) for human wellbeing. According to the World Bank (2011), natural capital provides about per cent of the total wealth of all developing countries globally.
In Ghana, the promotion and mainstreaming of the sustainable development concept into our development agenda has gained increasing acceptance, especially among policy makers. Achieving sustainable development could ,however, be highly hampered by the over exploitation of natural resources across the country, especially in the forest and mining regions through illegal chainsaw operations and small scale mining among others. It is important to mention that promoting efficient natural resource management will place Ghana in a better position to achieve Sustainable Development Goals (SDGs) 2, 6, 1 The challenge of continuous non-sustainable natural resource management in Ghana is not only attributable to the country’s rather poor institutional capacity or ineffective monitoring of stakeholder activities but also because of the lack of a comprehensive accounting system in our natural resource management process. Accounting for our natural capital is a distinct way of acknowledging the value (in monetary terms) of both the environmental and economic activities and making choices based on those values.
The Natural Capital Accounting (NCA), is a concept introduced by the World Bank which involves the conscious effort to calculate the total stocks and flows of natural resources and services in a given ecosystem. The aim is to balance economic activities and environmental impacts taking into account all the costs and benefits including pollution and extent of natural resource depletion in economic accounts and development planning.
Benefits of NCA
Through the NCA, countries can measure the ‘total’ value (and wealth) in their natural resources as well as its effects on national accounts and economic growth. Accounting for Gross Domestic Product (GDP) for instance, provides information on economic activities and their linkage with improving livelihoods. However, this accounting is void of ‘what is lost’ in an attempt to improve livelihoods.
Through the NCA, countries can measure the ‘total’ value (and wealth) in their natural resources as well as its effects on national accounts and economic growth. Accounting for Gross Domestic Product (GDP) for instance, provides information on economic activities and their linkage with improving livelihoods. However, this accounting is void of ‘what is lost’ in an attempt to improve livelihoods.
The NCA, however, captures both scenarios and, therefore, provides a more comprehensively effective way of managing our natural resources sustainably.
The efficiency of natural capital stock availability and accessibility management is enhanced through the NCA. By accounting for natural capital, governments are directly involved in holistically measuring the total stock of natural resources available for use and after use for socio-economic development, as well as their degree of accessibility. This positions state organisations and other stakeholders to properly manage resources.
Natural resource management scheme frameworks or policies can be tested for efficiency over time via the NCA. Scarce resource protection and macro-economic indicator effectiveness among others are some key areas that can be tested for efficiency under national resource management options over the long-term if the NCA is adopted.The NCA can for instance, reveal the economic costs and benefits of land use conversion or of different types of land management.
Is Ghana ready to implement NCA?
Ghana on the whole is fairly well positioned to implement the NCA. Most, if not all of the various Ministries, Agencies and Departments (MDAs) needed for the NCA such as the Ministry of Environment, Science, Technology and Innovation (MESTI), Forestry Commission (FC) among others are already set up and fully functioning. The current global call for natural resource protection and climate change awareness has also increased the influx of Ghanaian consultants in these areas in the country. Moreover, natural resource management mainstreaming in national development plans in recent times have received positive political attention even though much can still be done in this wise.
Ghana on the whole is fairly well positioned to implement the NCA. Most, if not all of the various Ministries, Agencies and Departments (MDAs) needed for the NCA such as the Ministry of Environment, Science, Technology and Innovation (MESTI), Forestry Commission (FC) among others are already set up and fully functioning. The current global call for natural resource protection and climate change awareness has also increased the influx of Ghanaian consultants in these areas in the country. Moreover, natural resource management mainstreaming in national development plans in recent times have received positive political attention even though much can still be done in this wise.
Our natural resources are our wealth base as a nation. It is imperative to ensure all resources are sustainably managed regardless of our pace of economic growth and development.
The writer is an Environment, Climate Change and Energy Expert. Writer’s E-mail : [email protected]
