FFE Magazine

World Bank chooses the Philippines with four others to pilot project

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MANILA, Philippines – The Philippines has been chosen along with four more countries to pilot a World Bank project that helps nations incorporate the value of natural resources in their national accounts.

Environment Secretary Ramon Paje announced that the Philippines, Botswana, Colombia, Costa Rica and Madagascar will serve as implementing partners for the Wealth Accounting and Valuation of Ecosystem Services (WAVES) project of the World Bank.

WAVES is a global partnership that aims to promote sustainable development by ensuring that the value of natural resources is included in national accounts used to measure and plan for economic growth.

The four-year project, which costs US$ 1.45 million, is expected to roll off by the second half of 2013, with the National Economic and Development Authority, National Statistical Coordination Board, and the Laguna Lake Development Authority as collaborating agencies.

Paje represented the Philippines during a high-level ministerial meeting on natural capital accounting (NCA) or “green accounting” organized by the international financial institution in Washington on April 18.

Paje said the Philippines is selected as a pilot country for WAVES because it is one of the very few nations that have been conducting an accounting of natural resources since the 1990s.

“The country was noted for accounting for our natural resources such as minerals and forests to provide policymakers with accurate information that can help them make better decisions regarding development priorities and investments that are feasible and sustainable,” Paje explained.

“It is very important for us to account for our natural wealth, to uphold the principle of intergenerational equity wherein we protect the interest of future generations by protecting our natural resources, especially those that are finite such as minerals,” he added.

Paje cited Executive Order No. 79, which institutionalizes and reforms the mining industry, as a classic example of accounting for natural wealth for future development.

He said that while “increasing excise tax from mining companies makes sure that the State gets its rightful share from mineral resources, which are in fact part of the national patrimony, there is a need to account for the resulting increase in government revenues by investing them in certain long-term infrastructure and programs such as education and research.”

“This way, even though the non-renewable resources are extracted, future generations can still, though indirectly, enjoy them through improved goods and services and additional infrastructure,” he added.

The environment chief also expressed optimism that with WAVES, the government will be able to better address conflicting issues on mining, biodiversity conservation, environmental protection and climate change.

WAVES was initially launched in October 2010 during the Conference of Parties to the Convention on Biological Diversity in Nagoya, Japan. The partnership was able to formulate and propose a program of international action on ecosystems accounting at the Rio+20 Earth Summit held in June 2012.

The program of action was endorsed by 62 countries including the Philippines, 90 private sector entities and 17 civil society and international organizations, which all committed to support NCA to move beyond gross national product (GDP) as the main measurement of an economy’s progress.

The NCA is thought to be more accurate in determining economic growth and its sustainability than traditional economic indicators such as GDP.

 

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