Recirculation of Economic Dividends within Social-Economic-Ecosystems

  • Attitudes towards environmental issues around the globe are becoming increasingly polarized and intractable.
  • The recircularization of the economic dividends of economic-services may be the key enabling mechanism in overcoming barriers facing environmental projects.
  • Environmental issues might contribute to post-COVID economic recovery by changing the political, social and economic perceptions of environmental stewardship.

Ecosystems may be considered as either non-social or social ecological systems (SES) depending on the presence of social linkages and the perception of derived value from the ecosystem services (ES). However, ES may often be under competitive pressures where the consumptive demands of socio-economic projects impact ecosystem sustainability. While Elinor Ostrom’s seminal works on SES (Framework) and subsequent ‘Institutional Analysis and Development’ (IAD) framework focus on the subject from macro-scale systemic perspectives, there is increasing interest in adapting and applying these frameworks into a transdisciplinary approach by incorporating knowledge bases from other sources

ES as proposed by the Millennium Ecosystem Assessment and other concepts may be further subdivided into one of multiple subsets, further characterized as either consumptive or non-consumptive in effect. The non-consumptive subset was recognized in the subsequent formation of  ‘The Economics of Ecosystem Biodiversity’ (TEEB) initiative in 2007. 

This initiative recognized the importance of ‘perceiving ES values’ in “making nature’s values visible”, but dividend re-circulation remains problematic in many jurisdictions due to inadequate institutional structures. While consumptive ES dividend recirculation from water trading, resource leases and other charges are at best only partially recirculated to support environmental ecosystems, there is ample evidence that the rate of recirculation is insufficient to maintain, let alone restore, ecosystems to a sustainable condition. This infers a general under-valuation of ES under a predominantly consumptive ethos.

Attitudes to environmental issues around the globe are becoming increasingly polarized and intractable, often impeded by a persistent discord between two apparently divergent constructs: ‘the perceptions of environmental values’ and, ‘the economic imperatives of perpetual growth’. As a consequence, investment decisions in environmental initiatives, particularly in local and regional communities are frequently overshadowed by constrained budgets funding, urban advocacy and vested interests. 

Bridging the persistent and widening gap between these constructs suggests a paradigm-shift is needed; firstly, by acknowledging the connection between ES ‘value’ and ‘economic benefit’ in the political, economic and social contexts, and secondly, by integrating the principle of circular economics to incorporate and promote the recirculation of ES dividends as positive feedbacks within an ES ‘business model’.

Since all ‘natural’ ecosystems and embodied ES resources are existentially dependent on the sustainability of water resources, an Integrated Water Resources Management (IWRM) approach is frequently used to address water-intensive ecosystem challenges arising from development projects. As an example of an application of the REDSEE concept, Amamoor Creek, a unique sub-tropical riparian ecosystem in South East Queensland, Australia, was selected to explore the adaptability of the macro-principles of SES, IAD and TEEB constructs in meeting challenge at sub-catchment scale. While significant areas of remnant ecosystems remain in the catchment, there is a large backlog of restorative works required to maintain these ecosystems, but limited funding is preventing even basic maintenance programs.

Amamoor creek’s riparian ecosystem are refugial habitats for eleven vulnerable or endangered locally endemic species and the growing demand for eco-tourism represents both the increasing environmental pressure and the enabling economic opportunity underpinning a solution. The increasing domestic tourism market has seen significant investment in a heritage steam railway to Amamoor and significant patronage has been attracted by the nostalgic experience. Leveraging this patronage to increase eco-tourism dividends was explored.

Sub-tropical riparian rainforest typical of the Amamoor catchment  (courtesy of MRCCC)

Informed by SES, IAD, and interpreting DFID’s Sustainable Livelihoods Framework (SLF) the holistic, transdisciplinary IWRM approach using NORAD’s suite of logical framework planning tools synthesized a potential solution embracing context specific knowledge bases. 

The resulting Integrated Management Plan for the Amamoor Catchment Tourism Strategy (IMPACTS)  identified a potential catchment business model to recirculate dividends from ES recovered from eco-tourists through an autonomous fee-collection platform. This business model hinges on regulatory and institutional adjustments, approvals of funding and a ‘protected area declaration’ under the prevailing regulatory frameworks. 

As is the case in many other countries, the user-pays principle is well established in Australian and Queensland ecotourism sites such as the Great Barrier Reef and Kakadu National Park, but has rarely been applied at catchment scale. The emergence of technologies such as ANPR, GPS location and geo-fencing offer the tools to apply these proven methods at a more discrete and targeted scale. Incorporating an automated billing system employing ANPR and a mobile payment system to recover visitor charges on entry to the catchment, monitor anthropogenic impacts, collect and provide data from/to visitors and assist in the delivery of emergency services is included.

Estimates of the economic value of the Amamoor project outcomes suggest a 25% increase in total ecosystem services over the first five years. Earlier independent surveys support the demand projections of strong demand growth for ecotourism experiences which would contribute to and result from future expansion of eco-tourism activities in both scope and scale from its current reliance on day visitors.  In leveraging the wider region’s tourism attractions, the proposal has the potential to strengthen and diversify the local and regional economies, generating additional employment opportunities in a persistently disadvantaged region. 

ES initiatives that generate an ongoing funding stream for sub-catchment scale environmental management programs by further increasing value-perceptions of ecosystem services could represent the necessary driver of attitudinal and policy change. Beyond the above example, the economic constrictions of the COVID19 pandemic on global, national and local economies will necessitate a new model to address the ever-increasing funding limitations for environmental management programs under the prevailing fiscal, regulatory and policy environments. Using such an approach, environmental issues might contribute to post-COVID economic recovery by changing the political, social and economic perceptions of environment stewardship as an ‘investment opportunity’ rather than ‘elective cost’.

Steve is the Project Development Coordinator for the Coalstoun Lakes Water Development Program, addressing the global food, energy and water nexus through an integrated pumped-hydro and irrigation scheme. He is currently also completing a Master of Integrated Water Management at the International Water Centre based at Griffith University.

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