Wealth Accounting and the
Valuation of Ecosystem Services
Madagascar - Tapping Into Biodiversity for Sustainable Growth
Madagascar’s unrivaled biodiversity is undoubtedly its biggest asset. Nearly all (90 percent) of the plant and animal species found on the island are endemic. This rich and unique mix of flora and fauna generates significant foreign exchange earnings, with up to 130,000 people from all over the world visiting the country’s 6.9 million hectares of protected areas.
Indeed, terrestrial forests and coastal and marine natural resources play a huge role in supporting Madagascan local communities—providing food, fuel, shelter and livelihoods for 16 million people. But such resources are also important at the national level. Fisheries already contribute 7 percent of GDP and the growing mining sector is expected to contribute 15 percent of GDP in coming years.
We know that natural capital represents roughly half of Madagascar’s wealth. But there is no detailed quantitative analysis of these assets. The country urgently needs economic information about its natural capital to improve its decision making. Such information would help policymakers manage their resources sustainably. And it would help them find answers to some of the most pressing questions such as how to tap into the economic benefits of protected areas; how best to distribute and use mining revenues to support development; and how to manage conflicting demands on coastal resources.
Documents
Assessing and Valuing Ecosystem Services in the Ankeniheny-Zahamena Corridor (CAZ), Madagascar (pdf)
Making WAVES in Madagascar
The WAVES project in Madagascar will help the country fill key information gaps and improve economic decision making. In particular, it will:
- Develop macro-economic indicators, including Adjusted Net National Income and Adjusted Net Savings, to complement existing indicators and help monitor progress toward sustainable development
- Build comprehensive wealth accounts to assess the prospects for long-term, sustainable growth
- Contribute to medium- and long-term policy dialogue on rent recovery, distribution and investment in the mining sector
- Create national and river basin accounts for water resources and integrate them into macro-economic indicators
- Compile ecotourism accounts to inform policy dialogue on protected area financing
- Pilot ecosystem accounting approaches in the south-west of the country in the context of Integrated Coastal Zone Management planning
- Compile fishery accounts and feed them in to sector level policy dialogue
All these activities support existing government priorities at the sector level. They have been chosen for their ability to generate useful information for future policy development activities.
The story so far
WAVES has established a national steering committee to guide the project’s implementation, co-presided by the Secretary General of the Ministry of Economy and Industry and the Regional Vice President of Conservation International. The committee includes high-level representatives of all major stakeholder groups, including government, civil society and the private sector.
So far, the project has focused on developing a detailed workplan for the next three years. Outlining activities from 2012 to 2015, this workplan is the result of work by the national steering committee, with technical support from the World Bank. It has been informed by a range of technical activities including a literature review of previous research into ecosystems service evaluation. Two detailed case studies were done on water services in the eastern humid forest ecosystems and the policy and economic aspects of the fisheries sector.