Planet Over Profit – 23/3/22

Date: 23 March 2022

The second day of the ISA’s 27th Council meeting in Jamaica focused on financial aspects of deep-sea mining. DSCC in an intervention on Monday afternoon had raised the issue of environmental externalities, or costs.

ISA consultant, MIT’s Professor Richard Roth, replied that MIT was charged only with studying the financial aspects of deep-sea mining, which is why it did not factor environmental externalities into the models they proposed. The MIT report was commissioned by the ISA, raising the obvious question: why is a body charged with the protection of the marine environment not asking its experts to factor environmental externalities into their models? The DSCC raised the need to factor in environmental costs when considering payment systems in February 2019.  Greenpeace commented that “it is unacceptable at any cost to damage functions that are major contributors to a stable climate and the air we breathe.” 

Delegation after delegation noted the importance of environmental considerations which were absent in this report, which did not factor in environmental costs, such as loss of biodiversity, damage to ecosystem services such as carbon cycling and sequestration, and impacts on fisheries. Concerned countries included Germany, Spain, Fiji, UK, Chile and Costa Rica, African Group, Jamaica, Trinidad and Tobago, Italy,  Australia, Nigeria and Panama.

Key interventions:

  • South Africa said that deep-sea mining should only occur if it is demonstrably beneficial to humankind. Deep-sea mining would transfer ownership of commonly owned minerals to private ownership if it were to go ahead.
  • Germany specifically raised environmental costs and said that the economic idea behind factoring in environmental costs is the internalisation of operating costs to produce less environmentally damaging practices. Germany proposed that the working group explores a mechanism that internalizes external costs. 
  • Spain agreed with Germany and said we need to ensure that the deep-sea environment remains intact.
  • Fiji too said to consider the environmental costs in these models and said that it is a very real factor for Fiji. They wanted more research into these models, to continue the spirit of UNCLOS and consider the benefit of humankind. 
  • Chile supported Spain, Germany and South Africa and said that adverse environmental impacts could go way beyond any monetary benefits, therefore negatively impacting the good of mankind as a whole and of future generations.
  • Jamaica supported the call of other delegations calling to account for environmental externalities and economic incentives to minimize impacts. 
  • The DSCC said that failing to quantify these matters does not make them go away, and we must not press ahead, waving environmental damage to one side, because it is too difficult.  We reiterated that there is no case for damaging the environment, even if it has been valued. The uncertainties inherent in deep-sea mining alone make this very clear. A moratorium would give us time to undertake these studies. 

The result was that the Working Group suggested a study should be carried out on environmental costs, including how to internalise costs associated with externalities, including valuation of ecosystem services and natural capital, as well as incentives for good performance, and the impact of such costs on the payment system.

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