Senator Loren Legarda has filed a bill seeking to develop and implement an ecosystem and natural capital accounting system that applies to the Philippine environment, giving importance to the role, value, and impact of the country’s natural resources on the economy.
“For decades, the debate has been whether to choose economy over conservation of natural resources. This is a false dichotomy. The economy and all of society are fully and entirely dependent on natural resources—our natural capital that includes our forests, wetlands, and other ecosystems,” Legarda said.
The four-term lady lawmaker is expected to be elected as Senate President Pro Tempore when the Senate and the House of Representatives open the 19th Congress on Monday.
Legarda said indicators and standards generated by the national income accounting system are considered vital information for economic management and policymaking. They serve as the basis for socio-economic planning, formulation of development programs, and policy analysis to aid legislation.
However, conventional national income accounting systems measure economic performance by determining the value of goods and services produced in a country and aggregating them to develop economic development indicators, such as the Gross National Product (GNP) and Gross Domestic Product (GDP).
Senate Bill 9, known as the Philippine Ecosystem and Natural Capital Accounting System (PENCAS) Law of 2022, will include what was formerly considered “externalities,” not valued as capital, in the national income accounts.
“I consider it important that the national income accounts reflect a more accurate state of development and economic performance of the country and should incorporate both environmental and non-environmental inputs and outputs. This will allow policymakers to make responsive, relevant, and effective laws, plans, and programs necessary for national development. The climate crisis and biodiversity losses that could potentially lead to the next pandemic highlight the urgency of having this bill approved and implemented,’’ Legarda said.
“Good housekeeping requires that you work on what you have and not live beyond your means. It is the same for national patrimony. Not taking into account how much we have and how to allocate it drives our ecosystems to ruin,” she added.
When passed into law, the bill will allow government planners to fully understand the natural capital available and expendable in pursuing national goals.
Legarda highlighted what natural capital investments could contribute to the society and economy.
She underscored the importance of fully tapping into the benefits of natural capital by developing a governance framework that promotes nature-based solutions while reducing harmful practices.
“We should recognize the immense potential of using ecosystems, such as forests, mangroves, and urban green spaces, for climate change adaptation and mitigation, especially as we rebuild and recover from the pandemic,’’ Legarda stressed,
The PENCAS bill recognizes the critical role of natural capital in the Philippine sustainable development.
It also identifies the roles of various government agencies in natural capital accounting, especially that of the Philippine Statistics Authority (PSA) and provides funding to support the implementation of the PENCAS.