Over the past three years, the cost of living crisis has spread across the globe, affecting both rich and poor countries. Many blame the economic shock of the COVID-19 pandemic and Russia’s invasion of Ukraine. In Africa, these events are having an impact, but the spread of poverty was evident even before it occurred.
Across the continent, the cost of living crisis is hitting tough communities that were already struggling to access enough food, fuel, decent jobs and social support to survive. The already poor are getting poorer. People living just above the poverty line are below the poverty line. Since the pandemic, another 55 million Africans have fallen into extreme poverty.
Much of this poverty is caused by a long-term decline in the natural resources that support poor households. Soil, freshwater, forest and biodiversity degradation directly affect the livelihoods of millions of poor people living in rural areas. This is because these resources provide these communities with food, fuel, building materials and employment.
About 90% of people living in extreme poverty depend on forests for at least part of their livelihood, according to the United Nations Food and Agriculture Organization. And in recent years, deforestation has only accelerated along with other types of environmental degradation. This trend has not changed during the pandemic.
However, the main response of African governments has been to continue to focus on conventional economic growth. The problem with this approach is that it clings to Gross Domestic Product (GDP) as the sole barometer of economic development and fails to take into account the wealth contained in nature and ecosystems.
This myopic focus encourages policies and investments that unfairly favor the rich, while leaving the poor behind and allowing the overuse and depletion of the natural resources on which they depend.
Rather, African policymakers should focus on the natural environment that supports the poor without which they cannot survive rising costs of living or future crises.
Governments need to take steps to curb the environmental degradation that scares natural resources and reduces their resilience. This requires changing the way we measure progress and growth. They need to accept the GDP of the poor, that is, nature.
As for large companies such as agriculture, industry and finance, they need to be at the center of policy-making. The revenue generated by these projects in the public budget cannot outweigh the negative environmental impact and the economic loss it causes.
Moreover, taking action to protect the environment is often less costly than supporting large polluting companies and securing profits.
Take agriculture for example. Current subsidy schemes favor industrialized, chemical-dependent agriculture, benefiting mainly large landowners and multinationals at the expense of small farmers and the environment.
A staggering $611 billion is spent annually on agricultural subsidies, 86 percent of which ($528 billion) can have negative impacts on climate, biodiversity and human health. This amount exceeds the estimated $300-350 billion needed each year to transition to a sustainable, diverse and climate-resilient food system.
It is time for governments, multilateral organizations and businesses to turn the rhetoric of leaving no one behind into reality by recognizing and protecting the GDP of the poor. The time has come to realign sustainable development with human development.
To do so, there are three critical steps that need to be taken urgently. First, governments should transform wealth accounting by measuring the GDP of the poor. Rwanda already started doing this in 2014, allowing for more effective land-use planning and preventing ecological fragmentation. Governments can also use the Ecosystem Accounting Framework adopted by the United Nations Statistical Commission in 2021 as a model.
Second, governments and development partners must help African farmers move from extractive high-carbon agriculture to regenerative practices that boost the GDP of the poor. The example they should follow is Germany’s plan to abolish subsidies for harmful agricultural practices and to encourage research and development of alternative methods.
Third, development finance institutions and companies need to reorient their investment strategies to protect and preserve natural assets. Prioritize projects and initiatives that enable local communities to manage and benefit from their environment.
Certainly, recognizing the GDP of the poor is not just an accounting act. It is a necessary change in our political economy. By recognizing these assets, we can begin to loosen the grip of the deep-seated interests that profit from the status quo, while at the same time improving the well-being of the majority and protecting the planet’s natural resources. .
The cost of living crisis is a wake-up call for a serious reassessment of our priorities, systems and values. In our quest for wealth, we are calling to recognize that we have overlooked the natural abundance that supports billions of poor people.
It’s not just the numbers on the balance sheet that are at stake. At stake is our survival as humanity.
The views expressed in this article are those of the author and do not necessarily reflect Al Jazeera’s editorial stance.
