World threatened by ecological credit crunch

PARIS: Reckless borrowing against Earth’s exhausted bounty is driving the planet toward an ecological “credit crunch”, the World Wildlife Fund warned on Wednesday.

Growing demands on natural capital, such as forests, water, soil, air and biodiversity, already outstrip the world’s capacity to renew these resources by a third, according to the WWF’s Living Planet Report.

“If our demands on the planet continue to increase at the same rate, by the mid-2030s we would need the equivalent of two planets to maintain our lifestyles,” said James Leape, the green group’s Director General, in releasing the study.

The cost of bailing out financial institutions during the economic meltdown, while huge, pales in comparison to the lost value caused every year by ecological damage to the environment, experts say.

A European Union study calculates that the world is losing between two and five trillion dollars in natural capital every year due to the degradation of the ecosystems.

“The world is currently struggling with the consequences of over-valuing financial assets,” said Leape. “But a more fundamental crisis looms, an ecological credit crunch caused by under-valuing the environmental assets that are the basis of all life and prosperity.”

The report shows that more than three quarters of the planet’s population live in nations that are ecological debtors, countries where consumption outstrips biological capacity.

Produced with the Zoological Society of London (ZSL) and the Global Footprint Network (GFN), the bi-annual study measures the ecological footprint of human demand on natural resources, and assesses Earth’s ability to remain a “living planet.”