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Burnt trees are seen in Mallacoota on January 15, 2020 , Australia. The Princes Highway between Mallacoota and Orbost remains closed to public due to the risk of falling trees following the devastating bushfires that have swept through East Gippsland in recent weeks.
Luis Ascui | Getty Images
Over half of the world’s GDP (gross domestic product) is exposed to risks from nature loss, according to a new report.
It comes following a 12-month period which reportedly saw the hottest year on record for the world’s oceans, the second-hottest year for global average temperatures and wildfires from the U.S., to the Amazon, to Australia.
The report, which was produced by WEF in collaboration with PwC U.K., found that $44 trillion of economic value generation — more than half of the world’s GDP — is “moderately or highly dependent on nature and its services and is therefore exposed to nature loss.”
Policymakers and business leaders from around the world are due to arrive in Davos, Switzerland for the World Economic Forum (WEF) on Monday.
The annual January get-together is scheduled to focus on the intensifying climate crisis.
Economic security
Construction ($4 trillion), agriculture ($2.5 trillion) and food and beverages ($1.4 trillion) were found to be the three largest industries most dependent on nature.
Combined, their value is roughly twice the size of the German economy, the report estimated. These industries were said to rely either on the direct extraction of resources from forests and oceans or the provision of ecosystem services such as healthy soils, clean water, pollination and a stable climate.
It means that as nature loses its capacity to provide such services, these industries could be “significantly disrupted.”
Industries seen as “highly dependent” on nature generate 15% of global GDP ($13 trillion), while “moderately dependent” industries generate 37% ($31 trillion).
“We need to reset the relationship between humans and nature,” Dominic Waughray, managing director at WEF, said in the report.
“Damage to nature from economic activity can no longer be considered an ‘externality.’ This report shows how exposure to nature loss is both material to all business sectors and is an urgent and non-linear risk to our collective future economic security.”
‘We are in dire straits’
The theme for this year’s forum, which is often criticized for being out of touch with the real world, is “Stakeholders for a Cohesive and Sustainable World.”
WEF has said it aims to assist governments and international institutions in tracking progress toward the Paris Agreement and the UN’s Sustainable Development Goals.
The UN has recognized climate change as “the defining issue of our time,” with a recent report calling the crisis “the greatest challenge to sustainable development.”
Alan Jope, CEO of Unilever, said the “very need for this report shows that we are in dire straits.”
“Business and government leaders still have time to act on the findings of the New Nature Economy Report. If we work together, COP15 and COP26 can generate the commitments we need to move the planet from the emergency room to recovery,” Jope said.