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African Ministers and Experts Spotlight Efforts to Incorporate Natural Wealth Accounting in Development Planning
NAIROBI – Wealth accounting and the valuation of ecosystem services are critical to Africa’s future growth, as the continent undergoes unprecedented development.
Projections point, for example, to broad-based acceleration in growth in Sub-Saharan Africa to around 5.5 per cent in 2013-2014, reflecting robust domestic demand and increased investment in export-oriented sectors as the main economic drivers, according to the IMF World Outlook 2013.
Achieving long term development and poverty alleviation in Africa relies on the sustainable and optimal management of the natural resource base.
Natural capital is a critical asset, especially for low-income countries, where it makes up around 36 per cent of total wealth, according to recent World Bank estimates.
The international conference on “Valuation and Accounting of Natural Capital for Green Economy (VANTAGE)” in Africa – taking place in Nairobi on 3 and 4 December 2013 – brings together African ministers, renowned economists, scientists and development experts to review and recommend policy action towards incorporating the valuation of natural resources and ecosystems services in development planning and accounting.
UN Under-Secretary General and UNEP Executive Director, Achim Steiner, said, “Natural accounting and valuation is not a fringe activity, but a cornerstone of the wealth of nations upon which sustainable, equitable and prosperous societies will be built.”
“Africa stands to be a key player in the framing of a landscape of more intelligent management of the natural world – because Africa still has many of the resources that elsewhere in the world are increasingly in short supply. Sustainably managed resources can benefit and grow Africa domestically and globally while becoming a beacon of profiting from its rich and abundant nature-based assets,” said Mr. Steiner.
“The time has now come to ensure that by 2015 – when the UN’s Millennium Development Goals transcend into the Sustainable Development Goals – the global community has the strategies and the policies in place to ensure that nature is fully integrated into economies everywhere in a convincing way that leaves no margin of doubt in the minds of governments, business and wider society that a transition towards an inclusive Green Economy is not just about reforming and retooling energy infrastructure to new patterns of mobility – but is predicated on a new and fundamental relationship between economy and the ‘soft infrastructure’ of nature and its true wealth and value to us all”, he added.
As of 2005, half of Africa’s most biologically rich terrestrial areas lost more than 50 per cent of their area due to cultivation, degradation or urbanisation.
In Kenya, for example, deforestation stripped the country’s economy of an estimated US $68 million in 2010, dwarfing the economic benefits gained from industries such as forestry and logging.
According to the World Bank, Africa’s population is expected to increase by approximately 800 million people by 2040.
This projected increase will put even more pressure on the continent’s natural resources.
“This year marked the celebration of the 50th Anniversary of the Organization of African Unity predecessor to the African Union with a new vision, Africa’s ‘Agenda 2063′ which charts the continent’s trajectory to prosperity,” said Tumusiime Rhoda Peace, Commissioner of the Department of Rural Economy and Agriculture of the African Union Commission.
She added: “Natural resources are a critical asset to many African communities and nations who depend almost entirely on ecosystems for their survival and economic development. Knowing the value of our natural capital does not only contribute to the optimal use of our resources but also makes it possible to resolve trade offs across time and space. The VANTAGE initiative is exactly what we need in this continent. This will pave the path for effective and efficient use of natural capital.”
Innovative wealth indicators
Recent years have seen a growing recognition that a new system of resource valuation and accounting is urgently needed, in particular to help countries more accurately assess the wealth and wellbeing of their populations.
In May 2012, 10 African countries, along with various public and private organizations, adopted the Gaborone Declaration, which outlines a set of concrete principles and development goals that include valuing natural capital in the development planning process.
One month later, the Rio+20 Summit outcome document, The Future We Want – endorsed by more than 190 countries – called for broader measures of progress to complement conventional indices, such as GDP.
Released alongside the Rio conference, the Inclusive Wealth Report 2012 – published jointly by UNEP and the United Nations University’s International Human Dimensions Programme on Global Environmental Change (UHU-IHDP) – provided a rethink of traditional economic and development yardsticks. It introduced a new indicator, known as the Inclusive Wealth Index (IWI), which is aimed at revealing the true state of a nation’s wealth and the sustainability of its growth, beyond GDP.
For example, if measured by GDP, the economies of China, the United States, Brazil and South Africa grew by 422 percent, 37 percent, 31 percent, and 24 percent respectively between 1990 and 2008. However, when assessed by the IWI, the Chinese and Brazilian economies only increased by 45 percent and 18 percent. The United States’ grew by just 13 percent, while South Africa’s actually decreased by 1 percent.
In fact, a full 25 percent of the countries studied by the report showed a positive trend when measured by GDP per capita and by the Human Development Index (HDI) were found to have a negative IWI per capita. The primary driver of this difference in performance was those countries’ declines in natural capital.
Valuing ecosystems
Other recent studies have also explored the benefits of placing a value on critical natural resources.
A 2011 UNEP report entitled, Putting Ecosystem Management in the Vision of Africa’s Development, focuses specifically on ecosystems and ecosystem services – which include the multitude of resources and processes that are supplied by ecosystems, from the production of food and water, to the control of climate and disease, to water cycling and crop pollination.
According to the report, growth accounting without explicit valuation of ecosystem services is an incomplete analytical framework
It finds that there is an urgent need to increase national awareness of the role of ecosystem services in the development process and to work towards relevant legislation and institutional reforms.
Ecosystems serve a myriad of purposes in both the earth’s natural processes and in human life, and contribute significantly to a nation’s wealth. Without full valuation of less-tangible benefits from ecosystems, their exploitation will remain unsustainable and degradation inevitable.
Some examples of the potential economic value of ecosystems are:
• Forestry in Tanzania is officially close to 2.3 percent of GDP, however research suggests that if the wider benefits are factored in, the real contribution is over 4 percent of GDP.
• Emerging research suggests that the contribution of the value of forests to the GDP of Uganda is around US $136 million, which amounts to about 4 percent of GDP.
An estimated 486,000 work opportunities were created in South Africa in environmental rehabilitation programmes since 1995. In addition, 85,000 jobs were created through formal conservation of protected areas in game ranching and ecotourism. “Decoupling” resource consumption and economic growth
Placing a value on natural resources also demands a rethink of the traditional links between resource use and economic prosperity – separating environmental “bads” from economic “goods”.
By 2050, humanity could devour an estimated 140 billion tonnes of minerals, ores, fossil fuels and biomass per year – three times its current appetite – unless the economic growth rate is “decoupled” from the rate of natural resource consumption.
According to a UNEP report entitled, Decoupling natural resource use and environmental impacts from economic growth, technologies that have helped humanity extract ever-greater quantities of natural resources must be redirected to more efficient ways of using them.
Some improvements have been seen. Over the past century, pollution controls and other measures have reduced the environmental impacts of economic growth. And, thanks to innovations in manufacturing, product design and energy use – aided by the rising number of people living more efficient lifestyles in cities – the global economy has grown faster than resource consumption growth.
However, the report notes that those improvements have been relative. In absolute terms, total resource use grew eight-fold, from 6 billion tonnes in 1900 to 49 billion tonnes in 2000. It stresses that more remains to be done to reduce resource consumption while meeting the development needs of an equitable and sustainable society.
Deforestation in Kenya: a case study in natural resource accounting
In Kenya, recent economic valuations of the country’s forests have catalyzed a response to conserve and rehabilitate that vast natural resource.
Deforestation deprived Kenya’s economy of an estimated 5.8 billion shillings (US $68 million) in 2010, far outstripping the roughly 1.3 billion shillings injected from forestry and logging each year, according to a joint report by the Kenya Forest Service (KFS) and UNEP.
The Role and Contribution of Montane Forests and Related Ecosystem Services to the Kenyan Economy, released in 2012, points out that the contribution of forests is undervalued by some 2.5 per cent, putting the estimate of its annual contribution to GDP at around 3.6 percent.
Between 2000 and 2010, deforestation of the country’s water towers amounted to an estimated 50,000 hectares, leading to a reduced water availability of approximately 62 million cubic metres per year. This has also affected Kenya’s economy, which is vulnerable to inflation spikes during periods of drought.
In response, the Kenyan government is now working to rehabilitate the water towers, in particular the Mau Forest Complex. Between 2011 and late 2012, more than 21,000 hectares of forestland were repossessed and some 10,000 hectares were rehabilitated. A number of programmes and activities also were launched to improve the livelihoods of communities living in and adjacent to the forests.
Nigeria’s President, Bola Ahmed Tinubu is of the view that his administration’s renewed focus in driving international and local investments into livestock sector of the agricultural value-chain will end the crisis of farmer-herder clashes, eradicate hunger and poverty in addition to promoting economic prosperity.
President Tinubu said this Thursday in Rio de Janeiro, Brazil at the signing of a Letter of Intent between the Nigerian Government and the JBS S.A, one of the top three largest meat processing companies globally.
“What we are doing right now is that we are solving a problem that afflicted humanity in that part of Africa, clashes between farmers and migrating cows that have caused some life and bloodshed when there is a modern, civilized way to solve those problems and even bring a successful economy out of it.
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“We are trying to turn a situation of tragedy, hopelessness into economic opportunity, see through problems and see the opportunity that is involved in it.”
The Nigerian leader called on the company to see the considerable potentials in what he called the $2.5billion livestock investment opportunities in Nigeria, especially with its huge population and tap into it, given JBS S.A’s globally recognized expertise in the area of guaranteeing food security.
“We’ve heard so much about you in terms of the reputation, and we believe in the partnership we are forging today.
“Food security is extremely important. As we talk right now, there is hunger. However, there is huge hope. And you are one of those hopes that we are looking at.”
President Tinubu told the JBS top executives that Nigeria is ready to do business with them, assuring them of a good return on their investment.
Prior to his visit to Brazil, President had commissioned a team of Nigerian officials and private sector players to take the advantage of the G20 Leaders’ Summit in Rio to conduct a study tour of Sao Paulo, Brazil and explore the opportunities in livestock development, meat processing, seed development and multiplication for key grains.
In his remarks, the Minister of Livestock Development, Idi Muhktar Mahia, who led the delegation, reported to the President that the team embarked on guided, extended and intensive tours of companies on the scale of their global reach, the integrated nature of their operations as well as the deployment of advanced technology. He added that from their interactions with various companies, JBS S.A. was chosen being the second largest meat processing company in the world with the capacity to process 33,000 cattle daily and over eight million birds daily, using advanced zero-waste practices. The company employs over 200,000 people across its subsidiaries in more than 50 countries in the world including United States, Canada, Mexico, Saudi Arabia among others.
Wesley Batista, founder and President of the JBS group, said the company is the largest employer of labour in Brazil with over $79 billion dollars revenue already in year 2024.
“We are glad to work with Nigeria to work together to develop the livestock industry there. We think it’s a good opportunity for our business in Nigeria and Africa as we believe Nigeria can be the center of supply of protein to many countries in Africa. We look forward to working with you. We are almost in December and this year is almost gone. We hope to be in Nigeria as soon as possible,” the founder and Chief Executive said.
Other members of the delegation included Minister of State Agriculture and Food Security Hon. Aliyu Sabi Abdullahi, Co-chairman Presidential Livestock Reform Committee, Professor Attahiru Jega, the Secretary of the Committee, Professor Mohammed Kuta Yahya, and the Chief Executive Officer of Nigerian Investment Promotion Council, Aisha Rimi.
The National Association of Nigeria Travel Agencies (NANTA) has disclosed an investment of ₦742 million over the past three years to position Nigeria as a premier tourism destination at the annual World Travel Market (WTM) in London.
Speaking in Lagos on Thursday, NANTA’s immediate past president, Mrs. Susan Akporiaye, revealed that the funds were used for exhibition pavilions, magazine publications, and logistical support for members attending the prestigious trade show.
“In three years, NANTA has spent ₦742,226,100 to deliberately put Nigeria on the global tourism map at the WTM. This was achieved with only skeletal support in 2022 and 2023,” Akporiaye said.
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According to Akporiaye, the association received minimal support in its early years of participation.
In 2022, La Campagne Tropicana Beach Resort and Air Peace contributed by placing advertisements on the Nigerian pavilion and in the association’s magazine. By 2023, Ibom Air joined the effort, supporting NANTA with adverts, while La Campagne Tropicana maintained its support.
The 2024 edition, however, marked a turning point. Akporiaye noted that for the first time, Ibom Air went beyond advertisements to co-exhibit, alongside Eko Hotels and Sabre Travel Network. Their contributions made Nigeria’s representation at WTM more robust and impactful.
“Sabre Travel Network also supported us, so we had their graphics, as well as Ibom Air’s, displayed on our stand. Their contributions made our 2024 participation very grand,” she added.
Akporiaye highlighted that 90% of the funds for WTM participation came directly from NANTA members, underscoring their commitment to Nigeria’s tourism development.
“This shows that we are true patriots, and we deserve national recognition for our efforts,” she said.
NANTA began attending the WTM in 2022 to fill the gap left by Nigeria’s absence from the event for over 10 years.
The association saw the need to promote the country’s tourism potential and create international business opportunities for its members.
“It’s been a wonderful and successful three years that NANTA has participated in WTM, filling the gap left by Nigeria’s absence for over 10 years. We are glad to have handed over the baton of Nigeria’s participation at WTM to the Nigerian government this year,” Akporiaye said.
Through its participation, NANTA has secured affiliations with international tourism boards, organized product training for members, and raised awareness about Nigeria as a destination.
These efforts have also led to partnerships with global airlines and travel boards, fostering significant growth for members’ businesses.
“Our participation at WTM has helped members’ businesses grow significantly. We have formed partnerships with airlines and travel boards worldwide.
“Our greatest achievement at WTM is drawing Nigeria’s attention back to the need to exhibit at the global travel market,” Akporiaye said.
The initiative has also inspired members to expand their horizons into global Meetings, Incentives, Conferences, and Exhibitions (MICE) events.
Dangote Cement Plc, a leading cement manufacturer, has donated multi-million Naira educational support projects to secondary schools in Lagos as part of its social investment initiatives.
The company in a statement explained that the move is aimed at complementing the government’s efforts in providing quality and sustainable education in the state.
It was gathered that the projects were commissioned and handed over to various schools in the Ikoyi-Obalende Local Council Development Area, align with the Sustainable Development Goals (SDGs) on education. These goals focus on ensuring inclusive, equitable, and quality education, as well as promoting lifelong learning opportunities for all.
The projects, warmly received by both teachers and students, include 100 dual school desks for Ilado Community Junior High School and Wahab Folawiyo Senior High School, alongside a refurbished and fully equipped Chemistry Laboratory at the Government Senior Secondary School, Ikoyi.
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Also donated were reading tables, chairs, and bookshelves for the library at Government Junior Secondary School, Ikoyi.
A celebration also took place at Falomo Junior High School and Ireti Senior Grammar School, both in Ikoyi, where the company donated 20 brand-new desktop computers to the ICT departments of the schools.
At the event at Government Junior College, Ikoyi, the Group Managing Director of Dangote Cement Plc, Arvind Pathak, explained that social investment is a key part of Dangote Cement’s operations.
He said the company is dedicated to giving back to society and supporting the sustainable development of local communities, especially in areas where it operates.
Pathak’s address was delivered by Wakeel Olayiwola, the Head of Social Performance at Dangote Cement Plc.
He said, “education holds a pivotal role in the development and empowerment of the youths in the country. As a cornerstone for societal advancement, it serves as a critical tool for personal growth, economic development, and national progress. An educated youth population not only fosters individual success but also contributes significantly to the nation’s overall wellbeing.
“At Dangote Cement, we believe that providing quality education to our youth is vital and should not be left solely as the government’s responsibility. Thus, we aim to partner with the government to enhance educational development in this regard.
“The projects we are handing over today are part of our 2024 Corporate Social Responsibility (CSR) programme for selected schools within the neighbourhood of Dangote Cement Plc’s Head Office in Ikoyi, Lagos. These projects were selected based on need assessments in collaboration with the schools.”
As a responsible corporate entity, Pathak noted that Dangote Cement’s commitment to societal wellbeing, with investments in four key areas: Education, Healthcare, Infrastructure, and Economic Empowerment programmes.
“This year, our plants in Ibese, Ogun State; Obajana, Kogi State; Gboko, Benue State; Okpella, Edo State; and our Pan-African operations have launched several social investment projects. These efforts contribute to the quality of life in our host communities and support sustainable national development,” he added.
Pathak thanked the Lagos State Government, the Tutor General/Permanent Secretary, and the school management teams for their collaboration in identifying the schools’ needs and ensuring the timely completion of the projects.
Dr. Idowu Olufunke Oyetola, Tutor General and Permanent Secretary of Education District 3, Lagos State Ministry of Education, who was represented by Bolaji Rotimi Ajayi, Director of School Administration, praised the long-standing partnership with Dangote Cement, noting that the schools selected for the donations were fortunate beneficiaries. “We hope for more collaborations that will positively impact education,” she added.
The principals of the recipient schools expressed their gratitude after the formal handover of the projects.
Odunlami Olubunmi, Principal of Ilado Community Junior High School, Ikoyi, thanked Dangote Cement for the new desks, stating that the donation would significantly improve the learning environment for the students, helping to prepare them for a brighter future.
Bamidele Ayotunde, Principal of the school with the refurbished laboratory, urged other businesses to follow Dangote Cement’s example in supporting local schools, pointing out the positive impact of the laboratory’s renovation on the school’s learning environment.
The Principal of Ireti Senior Grammar School, Ikoyi, whose school received the new desktop computers, described the donation as a positive development and expressed hope for more support in the future.
Pupils also shared their appreciation for the contributions. Abiola Jamaudeen, a lab prefect at Government Senior College, Ikoyi, promised that the laboratory would be used to its fullest potential and well-maintained.
Lawal Rumayzo Abdulsalam, a student at the school, said the new library equipment would foster better reading habits and create a more conducive environment for learning, ultimately preparing them for success. Some students even performed special songs to welcome the Dangote team to their schools.
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