URGENT UPDATE: A new report reveals that Australia’s natural environment contributes a staggering $510 billion to the national economy each year, equating to the combined value of the finance and mining sectors. However, experts warn that the federal government is failing to invest adequately in biodiversity, jeopardizing this vital economic resource.
The environmental group 30 By 30 released the findings today, shedding light on the immense financial contributions of Australia’s ecosystems. The report comes just one month before the federal government is set to unveil its 2035 emissions target under the Paris Agreement and follows alarming data from a recent Farmers for Climate Action survey that identified climate change as the greatest threat to Australia’s future.
Prepared by Cyan Ventures, the report quantifies both direct and indirect environmental benefits, crucial for understanding the real economic impact of nature. According to author and managing partner Fraser Thompson, the challenge lies in placing a dollar figure on these benefits. “Nature doesn’t send us an invoice,” he stated. “This is a classic information failure in understanding nature’s value.”
The report found that direct benefits, including food production, raw materials, water supply, tourism, and recreation, amount to $138.2 billion annually, representing 5.3 percent of Australia’s gross domestic product (GDP). Notably, tourism and water sectors are the largest contributors. When factoring in indirect benefits, such as climate regulation and erosion prevention, the total skyrockets to $510.7 billion—essentially 20 percent of the nation’s GDP.
Thompson emphasized that this figure is conservative, excluding “non-use benefits” like social impacts to avoid overstating the environment’s financial contributions. “I was surprised it was that high,” he said, underscoring the urgency of recognizing nature’s importance.
Despite these staggering contributions, federal government spending on biodiversity has averaged only $476 million annually over the past decade, projected to rise to $762 million in 2024, accounting for a mere 0.1 percent of the budget. The report advocates for a significant increase in environmental funding to 1 percent of the budget, or $3.4 billion per year. It suggests that this could be achieved by reallocating funds from the Fuel Tax Credit scheme and disaster recovery expenditures.
The findings highlight that Australia’s economic future is intertwined with its ecosystems. Tim Nicol, director at Pew Charitable Trusts, stated that the importance of investing in nature cannot be underestimated by governments or businesses. “We need to treat investment in nature the same way we treat investment in infrastructure,” he urged.
As Australia grapples with climate challenges, the urgency for increased funding to protect its natural resources has never been clearer. The report serves as a clarion call for immediate action to safeguard the environment and ensure the country’s financial stability.
Stay tuned for further updates as the federal government prepares to respond to these critical findings. The future of Australia’s economy may depend on how it values and invests in its natural environment.
