MANAGEMENT AND ACCOUNTING OF NATURAL RESOURCES: (NCA)

Transcription

1 MANAGEMENT AND ACCOUNTING OF NATURAL RESOURCES: (NCA) Presented by: Portia Segomelo, WAVES Advisor, Botswana Date: 08 th March 2016 Wealth Accounting and the Valuation of Ecosystem Services Title Date 1

2 Why Natural Capital Accounting (NCA)? 1. To understand scarcity: How are stocks of natural capital changing water, minerals, land, biodiversity, etc? 2. Who are the users of natural capital? At what levels and what are the trends over time? To manage resources for sustainable development: 3. NCA is a tool to allocate natural resources where they can be most productive To realise policy aims e.g. income, jobs, social objectives and environmental protection 4. To improve planning systems: Integrating relevant natural capital information into decisions 5. To track real national development progress: Complementing GDP, highlighting value of natural resource Title Date 2

3 NATURAL CAPITAL ACCOUNTING (NCA) : A COMPLEMENTARY TOOL TO GDP 1. GDP looks at only one part of economic performance ie. income but says nothing about wealth and assets that underlie this income. 2. Examples: * when a country exploits its minerals, it is actually depleting wealth; * The same holds true for over-exploiting or fisheries or degrading water resources. 3. Key information about the declining natural assets is underestimated, missing or invisible in GDP and not measured in the System of National Accounts (ie. GDP) 4. What are the important functions of these natural assets * Provisioning services: Use of natural capital minerals, water, forests, thatching grass, fisheries etc * Regulatory / ecosystem services: carbon storage, water quality, flood attenuation, 5. Depletion of natural assets leads to environmental costs may include climate change, air & water pollution, soil erosion, land degradation, biodiversity loss; habitat loss Title Date 3

4 What is wealth? COMPREHENSIVE WEALTH - National Balance Sheet Total wealth Produced capital Financial capital Natural capital Intangible capital (residual) Buildings, roads, machinery, etc. Net financial assets abroad Minerals, energy Agric. land, protected areas,forests Livestock,wild animals fisheries Human capital (educ.& skills) Social capital (networks & Institutions) Using information on key assets on the national balance sheet, we can trace the level, composition of and changes in national assets over time, and assess sustainability Transforming natural wealth into other forms of wealth is the path to sustainable development Title Date 4

5 INTRODUCTION TO WAVES 1. Intensified commitment for Natural Capital Accounting during the Rio+20 process on sustainable development; Gaborone Declaration for Sustainability in Africa (GDSA) 2. Eight participating countries: Botswana, Madagascar, Colombia, Philippines, Costa Rica (CICs) also Guatemala, Rwanda and Indonesia 3. WAVES is funded by a multi-donor trust fund, overseen by a Steering Committee (UNEP, UNDP, Norway, Germany, UK, Netherlands) 4.WAVES adopts a UN Statistical Commission methodology of System of Environmental and Economic Accounting (SEEA) SNA and SEEA are both satellite accounts, the only difference is that SEEA provides additional information which is not reflected in SNA i.e depletion and degradation of natural capital Title Date 5

6 What is the methodology for NCA? Title Date 6

7 METHODOLOGY - structure 1. Use the System of Environmental and Economic Accounting (SEEA) methodology of the UN Statistical Commission 2. Stock Accounts physical availability of resources are quantified 3. Monetary Accounts economic accounts ie. Resource rents, wealth valuation eg. in the case of minerals 4. Informing policy making depending on resource availability, access and revenues generated, tradeoffs sector productivity contribution to GDP forecasting the needs for long-term growth Informing Sustainability objectives Title Date 7

8 BOTSWANA CASE STUDY 1. Endorsed by Botswana Economic Advisory Council duration: National Steering Committee chaired by Ministry of Finance & Development Planning; Multi-sectoral participation 3. Aim to institutionalise NCA i) establish accounting units ii) build capacity and train officials iii) set systems for regular updating iv) Integrate results of NCAs into policy and planning systems 4. Building accounts to inform development decisions Title Date 8

9 Policy Issues Botswana priority accounts: Minerals, Water, Ecosystems (Tourism), Energy, Macroeconomic Indicators for Sustainable Development The economy is characterised by: Reliance on Mining - How can NCA results inform aspirations for optimal use of natural resources and support economic diversification? Water Scarcity - Can water accounts provide results for improved water use efficiency? Energy Crisis - what are the available energy mix choices and is it viable to exploit the large-scale coal resources? Competing Demand For Land what options are available to better manage fragile ecosystems within growing needs for agricultural, mining and tourism development? Sustainable Development- The desire to address sustainability aspirations at planning and policy levels. Title Date 9

10 Update on NCA Implementation in Botswana 1. Water Accounts: (DWA, MMEWR) Water Accounting Unit with 5 officers Produced two technical Water Accounts Report from 2010/ /14, currently compiling 2014/15 Accounts Produced four policy briefs- water accounts results; water & agriculture; water & mining and water & irrigation 2. Energy Accounts: (DoE, MMEWR) Energy Accounting Unit with 4 officers Compiling Energy Accounts for ; Priority is given electricity and coal liquid fuels during 2016 Energy Accounts report due end of March Mineral Accounts (DGS, MMEWR) Mineral Accounting Unit- 5 officers Preliminary accounts for 2013 were done; currently compiling Mineral Accounts for 2014 (Diamonds, Copper, Gold, Soda Ash, Coal) Title Date 10

11 Update on NCA conti 4. Tourism Accounts (DoT, MEWT) Scoping exercise was undertaken in July 2014 Accounts for major ecosystems (Okavango, Chobe and Makgadikgadi Issues: land management/competing land uses, climate change, biodiversity management, MEWT prioritised tourism because of its importance GDP Tourism Accounts- 3 officers Data capture commenced and international consultant has been procured to undertake data assessment for tourism acc & issues for tourism policy commencing on 3 rd to 11 th March Macroeconomic Indicators for Sustainable Development A team of five dedicated officers Consultant has been engaged to provide technical support to the Macroeconomic Indicators Team 6. All components have a multi-sectoral Technical Working Groups Title Date 11

12 Results from Water Accounts Figure 1: Share in GDP, formal employment and water consumption by sectors, 2013 Title Date 12

13 Water Use Efficiency Figure 2: Average annual value added per m 3 by sector ( to ; constant 2006 BWP) Sectoral water use & consumption for period to was linked with the value added by sector obtained from the National Accounts. Transport & communication sectors generates most value added per m3 The energy sector generates negative value added/m3 (BWP-482), which reflects their serious recent electricity generation challenges and on-going plant construction. Title Date 13

14 Mineral Accounts rents generated by minerals, annual avg Mineral Rent (P million) % of total Diamonds 12, % Copper-nickel % Coal % Gold % Soda Ash % TOTAL 12,182 Title Date 14

15 Total Wealth: Real Asset Trends 1994 to 2013 Title Date 15

16 The NCA Roadmap (beyond WAVES) 1. Integrate NCA results into National Development Plan 11 to inform major development priorities 2. Integrate NCA into institutional arrangements enhance government ownership (central & local government ) 3. Strengthen understanding of NCA through implementation of Communication Strategy and build capacity of key players (including non-state actors) Communications workplan - to introduce NCA Communicate NCA results Take advantage of Ministry/sector events and meetings to share information Communicate NCA in Ministry newsletters, websites etc 4. Sharing Botswana NCA experience with other countries and regional frameworks such as: - Gaborone Declaration on Sustainability for Africa - African Ministerial Conference on the Environment - African Ministerial Conference on Water - Rwanda WAVES exchange and lessons learning - The East and Southern African Association of Accountants General (ESAAG) Title Date 16

17 THANK YOU! Title Date 17