Natural capital - European Comissioner Potocnik

Writing in March 2012, European Commissioner for the Environment Janez Potoènik explained why the environment could be the tipping point for economic growth in 2012...

The year 2011 ended on a positive note for the environment, as global leaders gathered in Durban at the UN Climate Conference and supported the EU's strong stance on the need for future action on climate change. The UN Conference on Sustainable Development in June – Rio+20 – will be an ideal opportunity to rally our global partners around the sustainability agenda, and underline the potential benefits for all. Durban may not have ended with a solution, but it ended with a message of hope that the world understands the seriousness of the environmental challenges we are facing, and hope that international environmental cooperation could be an effective way to deal with these challenges. I witnessed the same message of hope in Nagoya in 2010, at the Convention on Biological Diversity, where we reached important agreements in the area of biodiversity, with international commitments adopted by 193 countries, including the EU and all its member states.

Over the last 25 years, the EU has built up a vast network that now numbers over 26,000 protected areas in all the member states and an area of more than 750,000km², which is 18 per cent of the EU's land area. Known as Natura 2000, it is the largest network of protected areas in the world, and a testament to the importance that EU citizens attach to biodiversity – the variety of life on the planet – which is essential for our economy and our wellbeing. But ever greater pressure on this most precious natural resource means that we now find ourselves at a turning point, where we risk losing many of the vital services we depend upon.

Conserving biodiversity is not just about protecting species and habitats for their own sake. It is also about maintaining nature's capacity to deliver the goods and services that we all need, and whose loss comes at a high price. In 2012, biodiversity will remain a top priority, as we continue work on our biodiversity strategy and focus on implementing rules from the Nagoya agreement.

The EU's Biodiversity Strategy establishes six targets for future work in this area:
• Fully implement the Birds and Habitats Directives;
• Maintain and restore ecosystems and their services;
• Increase the contribution of agriculture and forestry to biodiversity;
• Ensure the sustainable use of fisheries resources;
• Combat invasive alien species;
• Step up action to tackle the global biodiversity crisis.

Each measurable target represents one of the main drivers of biodiversity loss and is accompanied by a corresponding set of actions. The main challenges ahead include the full and efficient implementation of nature protection legislation – especially the effective management and restoration of areas of high biodiversity value in Natura 2000 – tackling invasive alien species and protecting ecosystem services.

Biodiversity policies will also need to be integrated into wider policy concerns. This is why increasing the contribution of fisheries, agricultural and forestry policies to protecting biodiversity will be key to its success. Efforts have already been made in that direction by making the biodiversity strategy an integral part of Europe's wider 2020 strategy for smart, inclusive and sustainable growth. The new strategy also fully acknowledges the economic value of ecosystem services and the need to restore them for the benefit of the economy. Biodiversity loss is one of the main environmental challenges facing the planet. With this new strategy, the EU is striving to ensure that its natural capital is managed sustainably for the benefit of future generations.

In 2012, the European Commission shall be working intensively to improve implementation of all our environment legislation in key areas like air, waste, water, chemicals and nature. It is sometimes tempting to overlook the environment during a period of economic crisis, but that is a very short-term view. Our dependence on the world's resources is undeniably unsustainable. During the 20th Century, the world population grew four times; its economic output 40 times. We increased our fossil fuel use 16-fold, our fishing catches by a factor of 35 and our water use 9-fold. The 'business as usual' scenario tells us that we would need three times more resources by 2050. But already 60 per cent of the world's major ecosystems on which these resources depend are degraded or are used unsustainably. So 'business as usual' is not an option. Getting a grip on biodiversity loss and mainstreaming resource efficiency are inextricable from the fate of the global economy.

Europe's position in a resource-constrained world does not look so good: we are poor in mineral resources. Today, the EU imports six times more materials and resources than it exports. We get 48 per cent of our copper ore from abroad, 64 per cent of zinc and bauxite, and 78 per cent of nickel – and for some critical raw materials that are expected to become difficult to access, we are completely dependent on non-European sources. We import all of our cobalt, platinum, titanium and vanadium, as well as rare earth metals. But the Commission definition of resources is much broader: it includes, for instance, clean water or biodiversity and the ecosystem services that it provides. And the problem is wider than the one of scarcities – we need to address the loss of natural capital that underpins our economic activity.

We need to reduce the materials used by industry: to dematerialise not to de-industrialise. We need to develop smarter products that do the same with fewer resources. And we need to sell the associated services. We need new business models that encourage greater value added, and more life-cycle thinking – if every company could afford to carry out a proper life-cycle costing of its operations and products, and consumers were properly informed, then waste could be prevented, products recycled and re-used. A common approach across the EU would help break down barriers and open up more opportunities for a truly European Single Market for green products. Public authorities could help by making their procurement decisions sustainable across the life cycle.

The innovation challenge for this century will be making our resources go further – doing more with less – and reducing the impact of our activities. Europe must lead in meeting that challenge if we want to be competitive in a world of increasing resource constraints. European eco-industries are a significant economic sector with an annual turnover estimated at €319bn, or about 2.5 per cent of EU GDP. But this can be expensive, especially for small firms. Access to finance for innovative small firms is a barrier to growth. The venture capital market in the EU is one-tenth the size of that of the US. The European Commission proposed, in our Annual Growth Survey for 2012, to break down the barriers in the EU market for venture capital firms. This is vital if we want to get the growth in the market for the eco-friendly products that consumers want.

So I say, and will continue to say, that many of the challenges facing the environment in 2012 are also opportunities to respond to the financial and economic crisis. An economy that derives more value from fewer materials, through smarter consumption, will help us move towards sustainable growth, bringing new jobs in areas like eco-design and eco-innovation, recycling and materials recovery. A green economy clearly offers major opportunities for business to create new employment, as well as major opportunities to protect the environment. Forward-thinking businesses are already moving in this direction, enjoying the first mover advantages familiar to early adopters. The trust established among international partners and willingness to act together is something worth building on this year when we meet again in Rio, 20 years after the historical 1992 summit.

The road ahead may look daunting to some if we are to reach our goals of truly sustainable development and halting biodiversity loss by 2050, but we owe it to future generations to make the changes that will ensure our planet can grow.


This article first appeared on publicservice.co.uk: Meeting in the middle.