Climate change and shrinking biodiversity are very dangerous for the health of the world economy. Half of the world's economy is dependent on nature and any problem related to nature directly impacts the economy. This was revealed in a study by the World Economic Forum (WEF). The WEF has released the Nature Risk Rising Report ahead of its 50th annual meeting. The report has expressed concern over the dangers hovering over various species and their side effects. According to this, about 25% of our flora and fauna is under threat due to the activities of humans. 1 million species are on the verge of extinction. Many of these species may become extinct within the next few decades. An analysis of 163 industry sectors and its supply chains found that more than half of the world's total gross domestic product (GDP) is more or less dependent on nature and its services. WEF managing director Dominic Waghare said, "We need to redefine the relationship between nature and man." The report said that the impact on the economy from the loss of nature cannot be ignored.
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On the basis of value, there is a dependence of about 44 trillion dollars on nature and related services. Problems related to nature can affect this entire structure. Constructions ($ 4 trillion), agriculture ($ 2.5 trillion) and food and beverage (1.4 trillion dollars) are the top 3 sectors most dependent on nature. They are about twice the size of Germany's total economy. Such industries are either directly dependent on resources from forests, oceans, or on other factors such as fertile soil, clean water, pollination, and a stable climate. As nature becomes incapable of providing such services on its behalf, these industries can be severely affected. The size of industries that are heavily dependent on nature is about 1.3 trillion dollars and the size of some less dependent industries is equal to 31 trillion dollars.
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Indirect dependency too much
WEF has prepared this report in association with PwC UK. It states that there are many industries whose supply chain is indirectly dependent on nature. The damage to nature could have a greater impact on these industries than anticipated. There are 6 industries whose less than 15 % of their total business is heavily dependent on nature, but more than 50% of their supply chain is dependent on nature. These include industries related to chemical and material, aviation and travel and tourism, real estate, mining and metal, supply chains and transportation, and retail, consumer goods, and lifestyle.
