The Economics of Ecosystems and Biodiversity


At the meeting of the environment ministers of the G8 countries and
the five major newly industrialising countries that took place in
Potsdam in March 2007, the German government proposed a study on ‘The
economic significance of the global loss of biological diversity’ as
part of the so-called ‘Potsdam Initiative’ for biodiversity.

The following wording was agreed at Potsdam: ‘In a global study we
will initiate the process of analysing the global economic benefit of
biological diversity, the costs of the loss of biodiversity and the
failure to take protective measures versus the costs of effective

This proposal was endorsed by G8+5 leaders at the Heiligendamm Summit
on 6-8 June 2007.

With this in mind, the German Federal Ministry for the Environment
and the European Commission, with the support of several other
partners, have jointly initiated preparatory work for this global
study, which is named ‘The Economics of Ecosystems & Biodiversity
(TEEB)’. Mr Pavan Sukhdev, Managing Director and Head of Deutsche
Bank’s Global Markets business in India, and a Founder-Director of
the ‘Green Accounting for Indian States Project’, an initiative of
the Green Indian States Trust (GIST) to set up an economic valuation
and national accounting framework to measure sustainability for
India, was recently appointed as the independent Study Leader. He is
assisted in his task by an Advisory Board, which consists of
prominent experts.

The study will evaluate the costs of the loss of biodiversity and the
associated decline in ecosystem services worldwide, and compare them
with the costs of effective conservation and sustainable use. It is
intended that it will sharpen awareness of the value of biodiversity
and ecosystem services and facilitate the development of
cost-effective policy responses, notably by preparing a ‘valuation

The work is divided in two phases. Preliminary findings from the
first phase have been presented by Minister Gabriel, Commissioner
Dimas and Mr Pavan Sukhdev at the High-Level Segment of the Ninth
Conference of the Parties to the Convention on Biological Diversity
(CBD COP-9) in Bonn, Germany, in May 2008, in the form of an interim
report (pdf, ~8MB). The second, more substantial, phase of the study
will run into 2009, and its final results will be presented at CBD
COP-10 in 2010.

Various organisations have contributed to the preparatory phase of
this project with resources, studies, or expertise, and contributions
have also been received from individual experts. A list of the main
studies contracted by the European Commission and the German Ministry
for the Environment and provided by partners is given below:

EC contracts:
       Cost of policy inaction (COPI): The case of not meeting the
2010 biodiversity target. FINAL REPORT (Zip file, ~7,25MB)
       Review on the Economics of Biodiversity Loss: Phase I
(Scoping). Economic analysis and synthesis. DRAFT FINAL REPORT (pdf,
     * Review on the Economics of Biodiversity Loss: Scoping the
science. DRAFT FINAL REPORT (pdf, ~2MB)

BMU contracts coordinated by EEA:
       Ecosystem Accounting for the Cost of Biodiversity Losses:
Framework and Case Study for Coastal Mediterranean Wetlands. DRAFT
FINAL REPORT (Zip file, ~23MB)
       Study on the economics of conservation of forest biodiversity

UK DEFRA material:
       An introductory guide to valuing ecosystem services. FINAL
REPORT (pdf, ~430KB)
       UK Biodiversity Action Plan: Preparing Costings for Species and
Habitat Action Plans. FINAL REPORT
       Flood and Coastal Erosion Risk Management: Economic Valuation
of Environmental Effects. HANDBOOK (Zip file, ~1MB)
     * Valuing our Natural Environment. FINAL REPORT (Zip file, ~1,4MB)

FR MEDAD study:

     * The economic evaluation of goods and services provided by the
coral reef ecosystems. WORKING PAPER (FR) (pdf, ~280KB)

An international expert workshop on ‘The Economics of the Global Loss
of Biological Diversity” was held on 5-6 March 2008 in Brussels, and
provided ideas and recommendations on the way forward for the study.
The proceedings of the workshops and the presentations made are
available at:

A variety of contributions have been received in reply to the
web-based call for evidence organised by the European Commission from
November 2007 to January 2008. The call for evidence is officially
closed. However, the functional mailbox is still active and
contributions can still be sent to


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