Key information about natural capital is missing or invisible in the System of National Accounts (SNA), and in SNA-based indicators, such as GDP. Under-valuation of natural capital and the lack of integration of these values in policy decisions have been identified as two of the main causes of environmental and natural resource degradation (MA 2005). Therefore, it becomes essential to (1) develop Natural Capital Accounts (NCA), following an accounting structure similar to the SNA – in order to facilitate the integration of environmental and economic statistics – and (2) implement this framework using values that are anchored in scientific, credible, and international recognized valuation methods. This challenge is crucial in achieving sustainability of economic growth since “What we measure affects what we do; and if our measurements are flawed, decisions may be distorted.” (Stiglitz, Sen and Fitoussi 2009). At the same time, it is important to recognize that NCA is not a new concept and has been part of the environmental economics field for the last 25 years, but is as yet to be widely implemented. One reason for the limited uptake is that policymakers are still skeptical of its policy relevance. This policy session, organized as part of the World Congress of Environmental and Resource Economists, in Istanbul, Turkey, will present concrete examples of policy applications of NCA, with a focus on water and forest accounts, and feature conversations between researchers and policymakers on how NCA can be used to support policy decisions, particularly in Turkey.
The policy session, to be moderated by Prof. Anil Markandya (President of EAERE) will bring together researchers, practitioners, and policymakers on a panel to discuss policy applications of NCA and implications for Turkey. Prof. Geoff Heal will set the scene by highlighting the role of NCA in moving towards a better measurement of economic performance for the long term. Dr. Martin Raisser (World Bank Country Director for Turkey) will briefly talk about the World Bank-led Global Partnership on Wealth Accounting and Valuation of Ecosystem Services (WAVES) and discuss why the World Bank is supporting NCA. Ms. Arzu Önsal (Department of Environment and Sustainable Development, Ministry of Development, Government of Turkey) will talk about why Turkey is interested in NCA and how it can be useful for development planning. Dr. Urvashi Narain (WAVES, World Bank) will focus attention on water and forest accounts and how these have supported policy applications. Finally, Prof. Ebru Voyvoda (Middle East Technical University) will discuss how these accounts can be useful for Turkey.