Biodiversity and economy: Dasgupta's 10 options for change in Finland

Good Morning,

Cambridge economist Partha Dasgupta published a pioneering report The Economics of Biodiveristy, commissioned by the British Treasury Department in 2021. The report focuses on economic drivers of biodiversity loss and potential economic solutions to mitigate the loss.

Dasgupta's key message is that the demand for goods and services exceeds nature’s capacity to supply them in the long term. That is because nature’s worth to society is not reflected in market prices.

Last week, the Natural Resources Institute Finland published a report that adjusts the Dasgupta's findings in the Finnish context. Here are ten options for change, crucial in order to mitigate biodiversity loss locally and globally.

1. Nature's supply: Conservation and Restoration of ecosystems. Under 20 % of the Finnish land area is under conservation; the report suggests that 30 % of the land area should be protected.

2. Our Demand: Changing Consumption and Production of Food Patterns. Decreasing the supply of meat and dairy products by reducing the demand.

3. Trade and Supply Chains. Trade increases economic activity and thereby increases pressure on the biosphere. Another key issues are increasingly complex supply chains that allow biodiversity impacts to concentrate on certain areas, generating local biodiversity problems; Finland is a net exporter of environmental impacts.

4. Pricing environmental damage. Putting a price on both negative (environmental tax) and positive externalities (e.g. subsidies for landowners for protecting natural values).

5. Future population. Wealthy countries like Finland, with the highest per capita consumption of material resources and greenhouse gas emissions should support demographic change in the global south nations where the population growth is highest. The means to do this include supporting education, well-functioning societies and democracy and strengthening the status and rights of women and girls in the global south nations.

6. Changing Our Measures of Economic Progress. Accounting natural capital enables us to show the changes in natural capital over time and value of nature’s services and integrate these into national accounting. There have been distinct initiatives of natural capital accounting in Finland, but not an all-encompassing system.

7. Global public goods. Global public goods are common resources that benefit several groups of countries and the majority of the global population; oceans, rainforests and Arctic ecosystems generate ecosystem services globally. Especially regarding the Arctic regions, Finland should be vocal in the U.N. and other international environmental policy forums.

8. The Global Financial System. Banks and other major investors – especially pension insurance companies in Finland – should take more into account biodiversity loss in their lending and investment decisions.

9. Empowered Citizenship. The Dasgupta Review underscores the role of empowered and motivated citizens in bringing about the suggested systemic changes. Even though surveys indicate that most Finns use natural areas for recreational outdoor activities, it is less evident how well these active contacts with natural areas increase the connectedness of Nature and the motivation to act on more large-scale changes to protect biodiversity.

10. Education and biodiversity. The report suggests that biodiversity and the basics of ecology should be emphasized more in the National Curricilum in all levels of education; sections nine and ten are closely conncected.

Let's jump into this week's major headlines.

EU's Carbon Allowance (ETS) price development

UK's Carbon Allowance (ETS) price development

The Guardian | World risks descending into a climate ‘doom loop’, warn thinktanks. Simply coping with the escalating impacts of the climate crisis could draw resources and focus away from the efforts to slash carbon emissions, making the situation even worse.

The Guardian | Rising seas threaten ‘mass exodus on a biblical scale’, UN chief warns. The climate crisis is causing sea levels to rise faster than for 3,000 years, bringing a affecting almost a billion people globally. Some nations could cease to exist, drowned under the waves, UN chief Guterres said.

Reuters | EU lawmakers approve effective 2035 ban on new fossil fuel cars. The European Parliament on Tuesday formally approved a law to effectively ban the sale of new petrol and diesel cars in the European Union from 2035, aiming to speed up the switch to electric vehicles and combat climate change.

Kauppalehti | Global carbon markets value hit record €850 bln last year with 87 % of the markets in the EU. The emission allowance price averaged on 80 € / CO2 tonne in Europe last year.

Euronews | Report: EU dumps 37 million items of plastic clothing in Kenya a year. This fashion waste is too dirty or damaged to be reused and is creating serious health and environmental problems for vulnerable communities in the country.

Aljazeera | Brazil Amazon deforestation drops in Lula’s first month in office. Deforestation in Brazil’s section of the Amazon rainforest dropped by 61 percent in January, the first month in office for left-wing President Luiz Inacio Lula da Silva, however experts caution it is too soon to say whether it marks a long-term reversal.

HS | A rare earth mineral deposit discovered in Lapland. The estimated value of the potential mining investment is between €1 and 1,5 bln. Rare earth minerals face great demand as they are vital components in electric motors and wind turbines.

Sitra | Economics and society influencers: no economy without nature. Unless biodiversity loss is halted, public finance stability will be in jeopardy, pension fund risks will increase and financial stability may deteriorate, write economics and society influencers in a new Sitra memorandum.

HS | The next government must decide between increasing carbon sinks or drastically cutting emissions. There has been a heated debate on emission reductions as it was last year reported that the Finnish land use sector had become a net carbon emitter.

HS | BCG report: Green transition can increase Finnish exports up to € 100 bln. The Green transition holds many promises for companies that focus on reducing emissions in traffic, agriculture, and living, the report says.

STT | The Greens published their platform for the Finnish parliamentary election.

Euronews | Mining Europe’s biggest rare earth deposit could make life ‘impossible’ for Sámi communities in Sweden. In January, Swedish state-owned mining company LKAB discovered more than 1 million tonnes of rare earth minerals in Kiruna, Sweden’s northernmost city.

Reuters | Carbon tech investment defies venture capital downturn, says research firm PitchBook. Venture capital investment in carbon and emissions-related technologies such as carbon capture hit $13.8 billion in 2022, close to a record high $14.1 billion in 2021. The 2022 numbers defy a sharp drop in broader fundraising volumes.

Reuters | France: EU rules on ESG funds need tightening to cut greenwashing. The EU's sustainable finance disclosure regulation (SFDR) helps asset managers classify funds as sustainable, but France's markets watchdog AMF said there should be a "targeted review" by Brussels given it contains no minimum requirements, or definition of what is a sustainable investment.

Reuters | Australia denies permission for coal mine near Great Barrier Reef. Australia's environment minister on Wednesday declined to grant permission for a new thermal coal project owned by mining magnate Clive Palmer near the Great Barrier Reef.

STT | The Climate Fund has pledged €125 M for Finnish climate innovators since its establishment in 2020. 18 Finnish companies have received funding for innovations in the circular economy, bio-industry, and hydrogen economy.

STT |  All circular economy services in the Helsinki Metropolitan Area can now be found on one map. The City of Helsinki has published a service map with all circular economy-related services, from rental shops to second-hand stores.

STT | HSY Sortti service collected over 84 million kilograms of recyclable waste in 2022.

High variability reveals complexity under Thwaites Glacier. Ice loss from the West Antarctic Ice Sheet is one of the largest contributors to global sea-level rise. Indeed, the Thwaites Glacier in West Antarctica alone is responsible for around 4% of the total annual increase — a contribution that has earned it the name the Doomsday Glacier because of its potential to cause rapid sea-level rise over the coming century. In two papers, Davis et al. and Schmidt et al. report observations of the melt rate, ocean conditions and ice shape deep beneath the Thwaites Glacier ice shelf — suggesting that complex interactions between the ice and the ocean will have a key role in the glacier’s future. (Nature)

Microsatellite data predicts the imminent extinction of the boreal lynx (Lynx lynx) in France. Researchers used 23 microsatellite markers and 78 DNA samples, collected between 2008 and 2020, to establish the genetic state of the French Jura Mountain lynx population. The results show extremely low genetic diversity with an observed heterozygosity (Ho) of 0.36 and an effective population size (Ne) of 38.2. When comparing the source population (Carpathian), the inbreeding level is very worrying (Fe = 0.41). These results are among the lowest recorded for the Eurasian lynx. To avoid extinction, which we estimate will occur in approximately 30 years, the researchers recommend the introduction of new genetic material. The article was published in Frontier Conservation Science.

Chicken and farmed salmon have remarkably similar environmental footprints. The key is in the feed, said UC Santa Barbara marine ecologist Ben Halpern, director of UCSB's National Center for Ecological Analysis & Synthesis, and an author of a paper that appears in the journal Current Biology. In an effort to tease out opportunities for reducing the substantial environmental pressures of global food production, he and an international team of colleagues took a deep look at how we raise these two highly popular animals for consumption, focusing in particular on dynamics between land and sea. (Science Daily)

Coral reefs in the Eastern Pacific could survive into the 2060s. Scientists at the University of Miami Rosenstiel School of Marine, Atmospheric, and Earth Science found that some reefs in the tropical Pacific Ocean could maintain high coral cover into the second half of this century by shuffling the symbiotic algae they host. The findings offer a ray of hope in an often-dire picture of the future of coral reefs worldwide. The article was published in Proceedings of the National Academy of Sciences. (Science Daily)

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