News Column

World Bank Approves Grant to Study State of Philippine Natural Resources

May 28, 2014



WASHINGTON, May 28 -- World Bank issued the following news release:

The World Bank has approved a $700,615 technical assistance grant that will provide data on the current state of the Philippines' natural resources. Called Wealth Accounting and Valuation of Ecosystems (Phil-WAVES), the project will also promote the integration of principles of sustainable development into country policies and programs.

Ensuring sustainable use of natural resources could improve the lives of the poor as they are usually highly dependent on natural resources for their livelihood.

In 2013, agriculture, forestry and fisheries accounted for 11.2 percent of the Philippines' Gross Domestic Product (GDP) and a third of total employment. However, data from the Philippine Statistics Authority (PSA) shows that the poverty incidence in these sectors is high, reaching 36.7 percent in 2009. Sustainable management and judicious use of natural resources are thus critical to ensure that growth is pro-poor and inclusive.

Phil-WAVES will use the 2012 System of Environmental and Economic Accounting (SEEA), an internationally accepted framework for the accounting of natural resources, to measure minerals and mangroves. The PSA will use this information to develop macroeconomic indicators that will assess the value of these key natural resources and their contribution to the country's GDP.

"Having sufficient data on natural resources and analyzing this properly is crucial to making decisions that will help the country reach the twin objectives of ending extreme poverty and increasing shared prosperity. We are optimistic that Phil-WAVES will help us better appreciate the interactions between the economy and the environment," said Mr. Motoo Konishi, World Bank Philippines Country Director.

"Knowing the total value of natural capital like mangroves and minerals can help policy makers address poverty issues. For instance, lack of valuation of mangroves and their role in protecting the coastlines can lead to conversion to shrimp farms and other uses, with the poor losing their means of living from fish habitat destruction and their coastal communities becoming more vulnerable to extreme weather events like storm surges," said Mr. Konishi.

The Phil-WAVES grant will focus on capacity building and generating data and indicators for key natural resources, in order to support the Philippine government in institutionalizing the use of the selected SEEA modules. To ensure sustainability, four staff will be recruited under the grant to support PSA in the implementation of natural capital accounting (NCA).

This work will be completed by a second grant, also administered by the World Bank, in the amount of $800,000. This will support the policy analysis of the data and indicators produced by the minerals and mangroves accounts. In addition, two ecosystem accounts for Southern Palawan and the Laguna Lake basin are also being developed by the Department of Environment and Natural Resources (DENR) and the Laguna Lake Development Authority (LLDA).

"Phil-WAVES will help provide quality data on the current state of natural resources in the Philippines using an internationally accepted methodology. It will help us plan for pro-poor, inclusive growth through the sustainable use of key natural resources," said Arsenio Balisacan, Socioeconomic Planning Secretary and Director-General of National Economic and Development Authority, the lead agency of Phil-WAVES. A country coordinator and assistant will also be recruited under the grant to support NEDA with the overall coordination of the Phil-WAVES work.

"The implementation of NCA in the Philippines is well-timed. The current administration emphasizes governance reforms that include transparent and science-based decision-making, while pursuing sustainable, inclusive, pro-poor and resilient growth," Secretary Balisacan added.

Members of the Phil-WAVES Steering Committee include the Department of Budget and Management (DBM), PSA, Department of Finance (DOF), DENR, Department of Agriculture (DA), Climate Change Commission (CCC), Office of Presidential Advisor for Environmental Protection, and Union of Local Authorities of the Philippines (ULAP).

The recently approved Phil-WAVES grant will focus on minerals and mangroves and support the sustainable management of these key sectors. Executive Order 79 on institutionalizing and reforming the Philippine mining sector refers to WAVES as a tool for conducting resource accounting and cost-benefit analyses.

A national account and associated indicators will also be developed for mangroves, whose role in protecting coastal communities against storm surges and other climate change-related events was highlighted after Typhoon Yolanda (international name Haiyan).

"The Philippines faces the pressures of a growing population, rapid urbanization and competing land uses -- all of which contribute to the deterioration of natural resources. Added to this, it is vulnerable to climate change impacts, which greatly affect the poor and vulnerable groups of society. Amidst these pressures, Phil-WAVES will guide the Philippines in arriving at policies that will promote the sustainable management of its natural resources," said Stefanie Sieber, World Bank Environmental Economist for East Asia and Pacific, and task team leader of the project.

The Philippines is one of the core implementing countries in the WAVES Global Partnership Program, which promotes the implementation and institutionalization of NCA over a five-year period.

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