Inclusive wealth
There are three questions that the global sustainable development community is currently grappling with. First, can developing economies facing a Covid-19-related economic recession find ways to follow a 'build forward better' path? Second, can the economy follow a trajectory of development where the net emissions of greenhouse gases are sustained at zero (referred to as the NetZero Target)? Third, can rapidly declining biodiversity be halted through effective restoration?
The current initiatives implemented by Pakistan suggest that the answer to these questions can be an astounding - Yes!
Well-established scientific evidence is conclusive that we are putting exceedingly high pressure on our biosphere through our ever-growing demand for ecosystem services. The United Nations Environment Programme's assessment of all scientific assessments of the last 40 years strongly suggests mainstreaming nature in development. The landmark Dasgupta Review for the UK's HM Treasuryunderscores the point that human welfare is critically dependent on the many facets and functions of nature, and that the conventional metrics and tools of economics is unable to adequately capture their value.
Moving beyond GDP towards recognising inclusive wealth (comprised of the stocks of produced, natural and human capital) as the credible yardstick to measure sustainability and well-being is the call of our time. The UN secretary general in his remark on the new Ecosystem Accounts under the System of Environment and Economic Accounts has suggested the need for natural capital accounts. A wealth-centric economy is the need of our time. A recently launched reportThe Inclusive Wealth of Pakistan: The Case for Investing in Natural Capital and Restoration assesses Pakistan's inclusive wealth and captures assets invisible to GDP. The Inclusive Wealth Framework recognises that measuring the stock of natural capital is key to tracking sustainability and well-being of the nation and can help to inform the trade-offs involved in investing in national assets such as biodiversity, climate, human health, education and produced capital.
And this is where Pakistan's stellar achievement under the Ten-Billion Tree Tsunami Programme provides answers to the questions above, but perhaps even more importantly, hope for the region and the world.
The natural capital of Pakistan during 1992-22019 shows a decline although the rate of decline is much lower than those of many parts of the world. In recent years, Pakistan has implemented ambitious strategies for halting and reversing the trend of natural capital.
The last five years have shown evidence of an environmental turnaround. The Ten-Billion Tree Tsunami Programme is the fourth largest afforestation and restoration initiative in the world, having trickle-down effects in boosting the green economy. Restoration has high employment generating potential as the programme has created 85,000 jobs. Restoration provides compelling evidence for adopting green recovery in the post-pandemic era.
What do the estimates suggest under Inclusive Wealth Framework?
Between 1992 and 2019, Pakistan's inclusive wealth increased at an average of 2.3 per cent annually - it is modest growth, yet impressive considering many parts of the world for the same period have experienced very low or even negative growth in inclusive wealth. In 2019, the share of natural capital in inclusive wealth stands larger than that of produced capital.
As shown in the report, Pakistan has emphatically shown leadership in the types of changes needed to pro-gress on sustainable development by demonstrating the following:
First, Pakistan has begun the process of integrating inclusive wealth estimations as part of natural capital accounts. Pakistan is one of the first nations to produce inclusive wealth estimates following the publication of the Dasgupta Review.
Second, the massive restoration effort by Pakistan particularly through the Ten-Billion Tree Tsunami Programme, is demonstrating growth in natural capital, creating green economy jobs and healing the degraded land.
Third, the carbon sequestered and stored through restoration will help Pakistan in bringing their economy in congruence with the net zero target. Fourth, the Inclusive Wealth Framework would provide credible evidence to the Global Biodiversity Framework when the world meets in Kunming for the COP15 later this year.
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