Can you put a price tag on the Great Barrier Reef?

Can you put a price tag on the Great Barrier Reef?

Can you put a price tag on the Great Barrier Reef? Photograph: Gary Cranitch/The Reef Foundation

Economist John O’Mahony knows placing a dollar value on the Great Barrier Reef seems like an impossible task for some.

But as lead author of a major new report which puts that figure as $56 billion, the study has been a “labour of love” to help save the irreplaceable global asset under threat from climate change.

“The purpose of the report is to raise awareness of the economic and social value of the Reef and why we need to do more to protect it,” O’Mahony says.

Quantifying the economic and social assessments of the Reef’s worth in monetary terms is a way of trying to communicate to people its very significant value.

The Deloitte Access Economics study was released in June this year and has already achieved headlines around the world.

In order to put clear numbers in black and white, O’Mahony and his team used a variety of economic modelling techniques to calculate the economic, social and iconic brand value of the World Heritage site. The report draws on data sources like the ABS and other government agencies to calculate figures like $6.4 billion in value added to the Australian economy, as well as support for more than 64,000 jobs, including 33,000 in Queensland alone.

Putting a price tag on the Great Barrier Reef

Putting a price tag on the Great Barrier Reef Photograph: The Reef Foundation

The report, commissioned by the Great Barrier Reef Foundation, with support from National Australia Bank and the federal government’s Great Barrier Reef Marine Park Authority, also includes a new survey of 1500 Australians and international respondents from 10 countries to assess their “willingness to pay” to save the embattled marine system. The survey not only provided the basis for calculating the economic, social and iconic value of the World Heritage site – it provided in-depth insights to how people think and feel about the natural wonder.

Australians ‘willing to pay’

The survey results found that Australians are already very well-informed about the risks the Reef is facing.

“Climate change is the number one threat,” he says. “And the interesting thing is that Australians know this. Only two per cent of people said there was no threat to the Reef.”

After climate change, the next greatest threats highlighted in the report are mining activities next to the Reef, overuse, and farming and increased coastal development because of their combined effects on water quality.

The report also found the top reasons Australians were willing to pay to protect the Reef was to preserve it for future generations as well as it been the “morally and ethically right” thing to do. Further down the list, but still significant, were the importance for tourism and the local economy.

However, O’Mahony, a partner at Deloitte Access Economics, says the survey showed more needed to be done internationally to show the risks to the Reef, with increased willingness to pay coming with greater knowledge. After being made aware of the threats through watching a video as part of the survey, overseas respondents were quick to lend their support, he says.

A global responsibility

“It was surprising how many people thought the Great Barrier Reef is a global responsibility and asset. The Great Barrier Reef is clearly a great individual case study to highlight to people what’s at risk with climate change.

“Coral bleaching data shows that the Reef is under great threat at the moment. If that continues it’s going to undermine the value of the Reef over time. Those corals do not have enough resilience to regenerate themselves quickly enough after those coral bleaching events.”

Holly Heiniger, a University of Queensland PhD student, with Dr Rob Adlard and Dr Terrence Miller, fish parasite researchers with the Queensland Museum in the Lizard Island Research Station dive boat ‘Freya’

Holly Heiniger, a University of Queensland PhD student, with Dr Rob Adlard and Dr Terrence Miller, fish parasite researchers with the Queensland Museum in the Lizard Island Research Station dive boat ‘Freya’ Photograph: Gary Cranitch/The Reef Foundation

O’Mahony says a personal turning point driving his work was watching a David Attenborough documentary on the Reef and seeing the site in all its beauty and complexity.

“The Great Barrier Reef is a truly remarkable environmental asset. It’s a cornerstone of the marine ecosystem. It’s a place where marine species around the world come to breed and many species would be at risk if we were to lose it. The environmental consequences on the ecosystem would be disastrous. We should remember, it’s not just a pretty place – it’s a stunning environmental asset.”

Lasting cultural icon

Also significant was the value of the Reef to more than 70 Indigenous groups in the region.

“That Traditional Aboriginal and Torres Strait Islander Owners have a connection to the land is well-known and they place tremendous significance on a connection to the water as well,” O’Mahony says. “The Reef has a significant cultural, spiritual, educational and knowledge value stretching back tens of thousands of years.”

To those who question putting a dollar value on this environmental icon, he uses the health system as an analogy: our individual health is priceless but we know how much we value it in policy terms.

O’Mahony says the research highlights the need for a strong local regulatory framework and a readiness to go beyond our commitment to the Paris Agreement. Scientific funding into methods to make the coral more resistant to the bleaching would also have welcome benefits without affecting local industry.

Local wonder driving business

While O’Mahony says the $56 billion is a conservative estimation – valuing the Reef just from our nation’s perspective – it can be broken down into three main sections:

  • $29 billion from Australians who have visited the Reef on a holiday, honeymoon or a “bucket-list” trip
  • $24 billion from Australians who have not visited but place an intrinsic value on its existence and being able to leave it to future generations
  • $3 billion for those who use the Reef recreationally for activities like boating and diving.
Total economic value of the Great Barrier Reef

Total economic value of the Great Barrier Reef Photograph: The Reef Foundation

NAB Queensland State Director of Government, Education and Community, Rachel O’Neill, said it is vital that society understands just how important the Reef is so its threats can be addressed.

“Fifty billion dollars is an extraordinary contribution to our economy and with such a strong dependency of a healthy reef on such a large number of businesses and jobs, it is imperative that we understand the value and the linkages,” she says.

“The Reef is critical to supporting economic activity and jobs in Australia. The livelihoods and businesses it supports across Australia exceed that of many industries we would consider too big to fail.”

Ian MacLaughlin, founder and director of Skybury Coffee, operates his family plantation an hour’s drive away on the Atherton Tablelands. He sees the importance and has worked to foster sustainable working practices.

MacLaughlin has been growing coffee here for the past 30 years and credits a 5% premium he is able to charge internationally to the brand value of the Reef and his commitment to operating a sustainable business.

“Quality and taste are really important but if you can stack on environmental credentials and locations it assists with the price,” he says. “You need people to have an understanding of that and want to pay for it.

“What happened was we became pro-active in terms of quality control with the management of issues such as chemical use. The rest of the world took note and started paying more for our product.”

MacLaughlin also says he has about 50,000 visitors to his property each year thanks to the proximity to the Reef.

“I’m getting the spillover effect,” he says. “My business benefits greatly from the Reef. I wouldn’t have started my tourism business without it.”

Sustainability is key

Sitting between two World Heritage-listed sites in the Reef and the Daintree Rainforest, has made him especially conscious of finding the right balance between agricultural production and the environment.

The Skybury Tropical Plantation uses methods like integrated pest management while reducing nitrate runoff and increasing organic matter in the soils. The business has been recognised as an industry leader with its commitment to green farming with a Queensland Premier’s Sustainability Award.

“To me it’s a semi-wild place and it has a rugged nature,” MacLaughlin says of the Reef. “I like to be able to go there and immerse myself in that and to see the fish and coral and interact with the bigger game fish that are there. I’m blessed – it’s a wonderful part of the world. We protect our reef and it’s a fantastic place.”

Determination and innovation to save Reef

Great Barrier Reef Foundation managing director Anna Marsden says the report is a valuable tool to help kickstart and direct policy and donations after two years in a row of devastating bleaching.

“We believe it’s in the hearts and minds of all Australians to protect the Reef,” Marsden says.

“The Great Barrier Reef is priceless – you can never really place a number or a price on the environment; it’s something that can’t be rebuilt once it’s gone. But understanding what’s at stake economically assists with policy. We will use it as a funding lever.

Fish at the Great Barrier Reef

Fish at the Great Barrier Reef Photograph: The Reef Foundation

“The idea is that this is an enduring report that everyone in this space can use now. It’s a reminder to us just how important the Great Barrier Reef is to the world as well as a nation.”

Next up, is a series of events with government and academia to help pitch in to save the Reef using the report as a spur.

“There’s a real coming together of the minds and some really powerful moon shot thinking to get on top of this,” Marsden says. “I’m really hopeful with the right bold determination and innovation we will save the Great Barrier Reef.”

The Foundation is the lead charity for the Great Barrier Reef as an independent catalyst for projects involving business, industry, government, science and philanthropy to develop an adaptable and resilient reef. For more information go to www.barrierreef.org

For more information on NAB’s approach to Natural Value and how the bank is incorporating environmental considerations into business decision making, visit NAB Natural Value.

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