NOTE: The post below is my original post. Based on feedback, I have concentrated on Prof Quah ideas and explored his views more fully in my updated post here.
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Archived: Economics don offers unique perspective on nature conservation
The reasoning is common sense. The government of any country works towards economic growth. By developing their industries and housing their people, they degrade the natural environment. After achieving the prosperity they want, they can then look after the remaining green spaces.
Wealthy Singapore can — and is — is now doing just that, both at a government and citizen level, observes Professor Euston Quah, the head of Nanyang Technological University’s economics department.
Many would agree with him. But while environmentalists advocate preserving Singapore’s vestiges of woodlands and coasts, and developers talk about ‘developing sustainably’, he offers an uncommon reasoning to deciding how land use should be decided.
Every parcel of land has a price tag, he says, and how it is used should be decided by the highest bidder. Prof Quah’s maxim: “Nothing is free”. Take the 30-hectare parcel of land in Mandai that is set to be developed into a nature-themed attraction. On one side stand the developers, who will build Singapore Tourism Board’s project. STB hopes it will double the number of visitors to the Mandai area to five million and help treble tourism receipts in Singapore to $30 billion by 2015.
On the other side stands the value of the biodiversity — the woodland is home to the rare leopard cat, among other animals — and the value conservationists and the public place on it. But how does one value these intangibles?
Mandai roadmap: Expected to complement the adjacent Singapore Zoo and Night Safari, the planned nature-themed resort will both monetarise and degrade the existing plot of secondary forest. | Image: The Straits Times
It could go either way, but preserving it on the basis of petitions is not enough, he says. Chek Jawa was saved in 2001 by its popularity and biodiversity, but he calls the decision-making process too ad hoc for guiding future decisions.
Use the ‘auction method’, advocates Prof Quah. For example, to find out how much are people willing to pay to keep the Mandai area, one should create a hypothetical admission fee to the area. Ask a representative sample of the stake-holding segment above what price they would not pay to enter. Multiply this by the number of stakeholders, and one can arrive at the monetary value of the appreciation of the area — say, $30 million. If $30 million falls below the developer’s estimate of its value, the land should be given to the developer. If it is higher, it should be preserved as it is.
“This has been done in the west, with a proper auction in a proper survey,” he says. “Singapore can and should do it too.” But can one really put a dollar value on a stroll in the park after a hard day’s work? Are nature areas in land-scare Singapore not priceless?
His answer is simple: No. Everything can — and must — be measured, says the professor, who is also an adviser to various ministries and statutory boards in Singapore.
“People must be educated. Keeping the land as it is has a price,” he says. It doesn’t mean that if you enter for free, it is free. It can’t be. It is very costly.”
He says Singaporeans must understand that if the government leaves expanses green spaces alone, there would be housing and industry congestion. This would cause rental prices and business costs to balloon. Investors would eventually leave.
“That’s worrying. The more you keep land as pristine as it is, the higher the opportunity cost will be,” he says. “There is no such thing as free.”
If money grows on trees: Green spaces occupy only a fraction of Singapore’s land, but for Prof Quah, they must go if their ‘auction price’ fails to match those of competing demands. | Image: NParks
Because of Singapore’s premium on space, there is little room for error, says Prof Quah. Decision makers must then adhere to a disciplined method to allocate land. Error-minimisation is one of Singapore’s sacred cows, and he says this method ties in with the dollar-driven priorities of the government.
“It’s not the answer that’s important,” explains Prof Quah. “If you follow the process, the answers will be roughly correct. Without it, how will they decide?”
Not everyone agrees with his ideas. Dr. Peter Ng, the director of NUS’ Raffles Museum for Biodiversity Research, says the only link that the economy should have with the environment is that a first world economy like Singapore should have a first world conservation plan.
“If you want to conserve biodiversity for economic reasons, then give up,” he says. “Why should we keep our natural heritage? For emotional, sentimental, aesthetic reasons. The more people there are who do this, the more we will achieve.”
But land allocation must boil down to cost and benefit, insists Prof Quah, even when Singaporeans can now chase the finer things and greener spaces in life. If the green spaces don’t measure up, they will have to go.
“You must understand, what drives Singapore is not the environment,” he says. “Singapore’s bread and butter is industry, growth. Singapore operates on this principle.”
— Clarence Chua
Singapore's Green Awakening 
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