Economic Assessment of Forest Ecosystem Services Losses: Cost of Policy Inaction

The research evaluates the economic impact of forest area changes from 2000 to 2050, focusing on provisioning, regulating, and cultural services. Using a combination of market data, meta-analysis, and value transfer, the study finds that while managed forests may increase provisioning revenues, the loss of natural forests—particularly in tropical and boreal biomes—leads to significant welfare losses, primarily driven by the loss of carbon sequestration capacity. Brazil is projected to suffer the highest economic loss, potentially reaching 6% of its 2050 GDP.

• The study identifies carbon sequestration as the most valuable forest ecosystem service per hectare, followed by provisioning services, passive use, and recreational values.
• Under a business-as-usual scenario, the world's forest area is projected to decrease by 117 million hectares by 2050, which is approximately 3.2% of the current worldwide forest area.
• The most significant absolute forest losses are expected in Russia (approximately 47 million hectares) and Brazil (41 million hectares), with tropical and boreal forests experiencing the highest absolute losses.
• There is a projected global trend where natural forests are depleted and replaced by managed forests; while managed forests are expected to increase by 62% by 2050, this does not compensate for the 8% worldwide decrease in natural forest areas.
• Global welfare impacts of policy inaction vary by the valuation bound used: lower bound estimates suggest a total economic benefit of 2,700 billion US$ 2050 (+0.03% of 2050 GDP), while upper bound estimates indicate a loss of 11,800 billion US$ 2050 (-0.13% of 2050 GDP).
• Brazil is projected to face the most severe economic loss due to policy inaction, estimated between 2% and 6% of its 2050 GDP, primarily due to the loss of carbon stocks in the Amazonian forest.
• Developed regions (North America, OECD Europe, OECD Asia, and OECD Pacific) and some developing regions (China and Other Asia) are expected to see economic gains from policy inaction, largely due to increased revenues from wood forest products (WFPs).
• Carbon services represent the largest economic loss among the analyzed services, ranging from 6,500 to 20,000 billion US$ 2050, which is 0.07% to 0.23% of 2050 world GDP.
• The study concludes that the expansion of managed forests, particularly monoculture plantations, should not be viewed as a viable policy to reduce emissions from deforestation because they often cause biodiversity loss, soil contamination, and social conflicts.

APA

Chiabai, A., Travisi, C., Markandya, A., Ding, H., & Nunes, P. (2010). Economic Assessment of Forest Ecosystem Services Losses: Cost of Policy Inaction. Basque Centre for Climate Change. https://www.bc3research.org/h6T8Uy8Nm4gFs0O/2010091409092824704147.pdf

Chicago

Chiabai, Aline, Chiara Travisi, Anil Markandya, Helen Ding, and Paulo Nunes. Economic Assessment of Forest Ecosystem Services Losses: Cost of Policy Inaction. Basque Centre for Climate Change, 2010. https://www.bc3research.org/h6T8Uy8Nm4gFs0O/2010091409092824704147.pdf.

Wikipedia

{{cite report |last1=Chiabai |first1=Aline |last2=Travisi |first2=Chiara |last3=Markandya |first3=Anil |last4=Ding |first4=Helen |last5=Nunes |first5=Paulo |title=Economic Assessment of Forest Ecosystem Services Losses: Cost of Policy Inaction |publisher=Basque Centre for Climate Change |date=September 2010 |url=https://www.bc3research.org/h6T8Uy8Nm4gFs0O/2010091409092824704147.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{chiabai2010economic, author = {Chiabai, Aline and Travisi, Chiara and Markandya, Anil and Ding, Helen and Nunes, Paulo}, title = {{Economic Assessment of Forest Ecosystem Services Losses: Cost of Policy Inaction}}, institution = {Basque Centre for Climate Change}, year = {2010}, month = sep, url = {https://www.bc3research.org/h6T8Uy8Nm4gFs0O/2010091409092824704147.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }