The Biodiversity Crisis is Costing Billions that the Restoration Economy Could Save
Revegetation discussions are usually focused on the environment, and rightly so. Land clearing is ruining ecosystems, threatening native plants and animals (Australia has one of the highest extinction rates in the world), and directly contributing to climate change.
Preserving the natural environment for future generations would ideally be enough of an incentive to invest in revegetation, but there are other benefits, including financial ones. Biodiversity is critical to the Australian economy. According to the Australian Conservation Foundation, nearly half of Australia’s GDP is directly dependent on nature.
Agriculture, forestry, fisheries, food, construction and tourism rely heavily on nature (among others). The Australian tourism economy is worth $6.3 billion, alone. Nature-based tourism is one of the fastest-growing sectors with international travellers flocking to W.A. to see our stunning beaches, bushlands and national parks. However, 60,000 hectares of habitat containing threatened fauna and flora were cleared in the last 10 years, and another 10,000 hectares are earmarked for destruction.
Since European settlement in 1788, the main impetus for land clearing was agricultural use. And while farming feeds civilisation, we now bear the costs of poor practices. Mass clearing of deep-rooted native trees, water diversion and wetland infill have led to salinised land and water and topsoil erosion, impacting farming infrastructure and severely affecting agricultural productivity.
Looking at the ecosystem damage to agriculture via an economic lens, the costs are enormous:
- The loss of production from saline agricultural land costs an estimated $519 million annually
- Maintaining salt-damaged rail and roads an estimated $175 million (Auditor General 2018)
- Erosion costs agricultural production about $10 million a year (Herbert 2009)
The damage land clearing does to the environment doesn’t indicate a healthy future for WA’s biodiversity or the sectors that rely on it. And if the biodiversity crisis continues, industries that depend on it will lose billions of dollars.
The restoration economy
Despite land clearing’s effect on biodiversity and local markets, there is a growing economy that is restoring native vegetation and creating huge economic potential. “Net zero” is on every big business’s agenda, and carbon offsetting is not only a “good to have” but a must-have as we move into the clean energy revolution.
As Sofia Faruqi aptly says in The Business of Diversity, “fostering biodiversity can have a tremendous positive impact on profit, innovation, and business sustainability.” Enter the restoration economy.
Researchers describe the restoration economy as “activities intended to result in ecological uplift, improve ecosystem health, and result in a functioning ecosystem that provides a suite of ecosystem services.” The restoration economy is rapidly growing with substantial income potential far outweighing the oil & gas industry.
In 2019, The UN announced 2021 to 2030 as the UN Decade on Ecosystem Restoration, aiming to scale up restoration. Demand for services that protect and restore nature is expected to increase over the next decade, and the private sector is seeing value in investing in conservation.
One example of restoration investment is The Land Degradation Neutrality Fund (LDN Fund). Managed by Mirova—an investment group specialising in responsible investing and promoted by the United Nations Convention to Combat Desertification— the LDN Fund raises private capital for sustainable land management and restoration activities worldwide. Aside from the environmental benefits of restoring degraded land, the LDN Fund creates job opportunities for local communities and generates revenue from the sustainable use of natural resources.
The carbon offset marketplace is also driving the restoration economy and is expected to hit $50 billion annually by 2030. Companies unable to lower greenhouse gas emissions are investing in carbon credits, certificates representing carbon gases that have been removed from the atmosphere or that stop gases from being released. Carbon credits are created through carbon offset projects, like revegetation, which will play a key role in the restoration economy.
Revegetation supporting local
Recently, we saw the restoration economy firsthand. Plantrite partnered with Nativ Carbon to deliver a revegetation project in Moora in W.A.’s Wheatbelt. We worked strategically with Nativ Carbon to deliver 1.2 million seedlings to the area. Over 200,000 Banksia tube stock were propagated, which will help return biodiversity to the area and deliver long-term sustainability benefits to W.A.
The Moora project employed 30 people to work in seed collecting, fence removal, weed control and plant installation. Nativ Carbon employed a substantial number of Aboriginal people with the support of Gambara, a majority-owned Indigenous company specialising in environmental, landscaping, rehabilitation and revegetation. Plantrite also employed 20 staff to help grow plants over six months at our nursery.
Revegetation projects will be vital to the restoration economy. These projects will not only restore biodiversity, which is critical to Australian markets but inject money into communities and create job opportunities, including native seed collection, land management, earthworks and planting.
We look forward to more Australian companies becoming aware of the economic impact of destroying biodiversity and the opportunities in the restoration economy. Through investing in revegetation projects, they’re securing a healthy planet and a profitable future.
Plantrite can manage your large-scale revegetation project.