Putting a price on nature

New project to create natural capital accounts for Cayman

It is hard to put a dollar amount on the value of natural attractions like Booby Pond in Little Cayman, but natural capital accounting aims to approximate some of the 'services' provided to people by the environment. Photo: James Whittaker

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Most people understand that natural attractions, like a beach, a coral reef or an area of mangrove wetlands, have value.

But what are they actually worth and how can that stack up against the promise of jobs and economic benefits that comes with every new development?

A new project seeks to quantify Cayman’s natural resources and put a dollar value on some of the ‘ecosystem services’ they provide, which range from supporting tourism to protecting the island from storms.

Environmental economics company Eftec has been retained through the UK’s Darwin Plus scheme to create a set of ‘natural capital accounts’ for Britain’s Overseas Territories, including Cayman.

Jake Kuyer, of Eftec, said the company would use cutting-edge statistical tools to create national accounts for the environment.

Once the project is complete, Cayman will know exactly how much coral reef, mangrove wetlands and dry forests remain across the three islands. It will also be able to put a price on some of the services they provide.

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Kuyer said the concept of natural capital accounting, endorsed by the United Nations, aims to give decision makers a way of understanding some of the economic benefits of nature.

He said some of those benefits, like impacts on fisheries and agriculture, are easily understood. Other ‘services’ provided by natural systems, such as air filtration, coastal defence, recreational space and public-health benefits, are harder to quantify.

“There is a lot of scientific research that allows us to demonstrate some of those economic values,” he said.

He acknowledged there was no way to put a precise value on the intrinsic and spiritual value of natural places.

“We don’t want to ever claim we could get to the full value,” he added.

The aim is rather to put the environment on an equal footing with other factors.

Kuyer

When it comes to planning decisions, for example, he said governments often had clear statistics on the economic impact of major projects.

Natural capital accounting seeks, in part, to translate environmental value into that same economic language.

It makes it easier, says Kuyer, to factor in the value of mangrove wetlands as fish nurseries or a reef as protection from storm surge, when making a decision about a new sub-division or a dock.

“The idea is that the accounts are updated each year,” he says, “so you would have an ongoing record of the value of your natural resources.”

He says that would also provide an alternative measure to gross domestic product to evaluate the ‘success’ of a country.

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2 COMMENTS

  1. On its face, this type of activity seems well intended. Put a large enough value on the tens of millions of unseen coral reefs or soon submerging mangroves and repeat the dollar figure enough times to children, so by the time they grow up, the future generation will think twice about cutting channels in them or cutting them down to develop neighborhoods in. There are many islands in our region. The Bahamas, Central America, Cuba etc that are much more undeveloped and “even more valuable” environmentally than here. There are trillions of dollars in reef and rocks and palm trees around the region where nobody wants to live. Even Jamaica with its millions of people seems more pristine and sparsely developed than here. The Country would be worth tens of billions environmentally. Cayman is a small Country with very little land for our next generation to keep the economy expanding. It would be dangerous to place an artificial value overlay on an island so small and unfairly impacted by it. People want to come to this island because of rule of law and structural underpinnings and infrastructure imagined and created by our forefathers and this current generation of investors. It would be a pity if the next generation of Caymanians were unfairly held back and boxed in by a rigid and unfair set of economic overlays imposed by off-islanders or established players who use the whip of our affiliation with the UK to impose grandiose European centric influence and environmental restraints here while our neighbors are free to develop and compete against Cayman. “The people” want to come to the Cayman Islands because we built something here. We need more environmentally sensitive development and infrastructure and less foreign influenced environmental blanketing and over-reach that artificially boxes our Country in. The value we artificially ascribe to rocks and trees and reefs and swamp here won’t save our government if it gets lulled into a stupor by environmentalists who would shut everything down here to protect every last blade of grass over the coming of people who made this place interesting in the first place and who would work to make this Country relevant, well into the future.

  2. Any effort to bring awareness to our essential natural resources should be applauded. This article touches an uncomfortable truth about our society. To see value in our most sacred resources, we must first convert them to dollars. Deep down, we all understand the intrinsic and spiritual value of nature. Let us put equal effort in this spiritual understanding as we do our scientific & economic endeavours.