Valuing Natural Capital

This policy brief by the South African Institute of International Affairs (SAIIA) argues for the integration of natural capital accounting (NCA) into global economic models and national systems of accounting. It highlights the critical importance of natural assets for low-income countries and Africa, and provides specific recommendations for the 2025 South African G20 presidency to champion the natural capital agenda, build conceptual consensus, address data gaps, and implement bioeconomy initiatives.

• Traditional economic models fail to account for the decline in natural capital, despite estimates that the value of nature's services exceeds the world's gross domestic product (GDP) by more than one and a half times.
• Low-income countries are particularly dependent on natural capital, which accounted for 47% of their wealth according to 2018 estimates.
• Africa possesses significant natural resources, including 30% of global mineral resources, 65% of uncultivated arable land, and 44.8% of the global technical potential for renewable energy, yet it is the only region where natural capital per capita has not grown sustainably, falling from $4,374 in 1995 to $2,877 in 2018.
• Standardizing natural capital as an asset class in national accounting could improve the sovereign ratings of African countries and reduce their borrowing costs.
• The 2025 South African G20 presidency is encouraged to build a consensus on the definition of natural capital, as current definitions vary; for example, the UK Natural Capital Committee includes ecosystems and processes, while the World Bank and UN focus on rents and exclude implicit values like air and sunshine.
• There is a critical need to address data gaps in Africa, where natural capital was estimated at $6.2 trillion in 2018 but is likely underestimated. The brief suggests the South African G20 presidency use the G20 Data Gaps Initiative (DGI) to include natural capital data.
• The brief recommends that South Africa build on Brazil's Bioeconomy Initiative by facilitating the creation of a bioeconomy hub to foster public-private partnerships and practical implementation.

APA

MC LEAN, J., & RUBIDGE, L. (2024). Valuing Natural Capital. South African Institute of International Affairs. https://saiia.org.za/wp-content/uploads/2024/09/SAIIA_PN_8_G20NaturalCapital.pdf

Chicago

MC LEAN, JORDAN, and LAURA RUBIDGE. Valuing Natural Capital. South African Institute of International Affairs, 2024. https://saiia.org.za/wp-content/uploads/2024/09/SAIIA_PN_8_G20NaturalCapital.pdf.

Wikipedia

{{cite report |last1=MC LEAN |first1=JORDAN |last2=RUBIDGE |first2=LAURA |title=Valuing Natural Capital |publisher=South African Institute of International Affairs |date=8 September 2024 |url=https://saiia.org.za/wp-content/uploads/2024/09/SAIIA_PN_8_G20NaturalCapital.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{mclean2024valuing, author = {MC LEAN, JORDAN and RUBIDGE, LAURA}, title = {{Valuing Natural Capital}}, institution = {South African Institute of International Affairs}, year = {2024}, month = sep, url = {https://saiia.org.za/wp-content/uploads/2024/09/SAIIA_PN_8_G20NaturalCapital.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }