How to Value and Restore Wetlands as Natural Infrastructure for Resilience

Home to sixty percent of the world’s population, Asia and the Pacific depend heavily on water resources, which—along with the ecosystems that sustain them—are under severe threat.

• 87% of global wetlands have been lost over the past 300 years, primarily due to drainage for housing, industry, and agriculture.
• More than one-third of wetlands have disappeared since 1970.
• 83% of freshwater species are in global decline.
• 80% of wastewater worldwide enters wetlands untreated.

Wetlands provide critical ecosystem services, yet their rapid depletion continues largely because these services are delivered without accounting for their costs. This lack of market valuation has contributed to their undervaluation and neglect.

Economists have long attempted to quantify these services. One of the earliest and most widely cited assessments (Costanza 2014), estimated that wetlands in Asia and the Pacific provide $14–19 trillion in ecosystem services, derived from a global estimate of $47 trillion at that time. More recent analysis in the Global Wetland Outlook 2025 reports that global wetland extent has declined to 1,425 million hectares, leading to lower global valuation of 39.01 trillion, with Asia accounting for an estimated of 10.6 trillion. As valuation methods continue to evolve, ecosystem service estimates have become more generalized across regions, reflecting both improved methodologies and reducing uncertainties. Despite this staggering figure, wetland loss persists. Several factors explain this paradox:

• Nature’s services are freely accessible, leading to systemic undervaluation.
• While produced capital per person grew by 13% globally between 1992 and 2014, natural capital declined by 40%.
• Economic growth often prioritizes produced and human capital at the expense of natural capital.
• Current consumption patterns suggest humanity requires 1.6 Earths to sustain existing living standards.
• The Global Biodiversity Framework estimates over $920 billion annually is needed to close the biodiversity finance gap.
• Subsidies and incentives that encourage wetland destruction far exceed investments in conservation.

Communities most dependent on wetlands (and most affected by their loss) are often the poorest and politically marginalized, with limited capacity to influence policy.

Failure to protect wetlands has profound human impacts.

Loss of livelihoods and culture: Approximately 300–400 million people in Asia and the Pacific depend on wetlands for fishing, agriculture, and tourism. Degradation threatens income sources and food security. Wetlands such as the Sundarbans and Tonle Sap Lake also serve as major tourist attractions; their decline reduces economic opportunities. Beyond biodiversity and ecological services, wetlands hold cultural and spiritual significance. Their loss erodes heritage and traditional practices.

Food and water insecurity: Wetlands sustain fisheries and agriculture by providing water and nutrients. Their degradation reduces crop yields and fish stocks, threatening food supplies, while pollution and over-extraction compromise clean water for drinking and irrigation. As a result, an estimated 10–30 million metric tons of rice are lost annually, equivalent to $3–10 billion in economic value (FAO 2023).

Health impacts: Polluted wetlands become breeding grounds for disease vectors such as mosquitoes, increasing risks of malaria, dengue, and other illnesses. Burning peatlands releases harmful pollutants, causing respiratory problems. Many wetland plants are used in traditional medicine, and their loss limits healthcare options for local communities. Each year, an estimated 600,000–800,000 malaria deaths and 500,000 diarrheal deaths occur in Asia and the Pacific (WHO 2024).

Biodiversity loss: Wetlands host unique species, many endangered. Biodiversity loss disrupts ecosystem services, reducing resilience to environmental change and undermining human well-being.

While biodiversity is in crisis, it remains central to addressing climate and environmental challenges. The rich biological diversity in wetlands enables these ecosystems to adapt to environmental change, maintain productivity, and sustain critical services such as water purification, flood regulation, and fisheries—making wetland conservation a critical investment. As economist Partha Dasgupta notes in The Economics of Biodiversity (2021):

“Biodiversity enables nature to be productive, resilient and adaptable. Just as diversity within a portfolio of financial assets reduces risk and uncertainty, so diversity within a portfolio of natural assets increases nature’s resilience to shocks, reducing the risks to nature’s services. Reduce biodiversity, and nature and humanity suffer.”

Countries and communities are increasingly adopting NBS to restore wetland biodiversity and build natural capital. Evidence shows that NBS, while not universally applicable, can be integrated into most strategies and often deliver high benefit-to-cost ratios compared to traditional engineered approaches. The examples in Table 1 illustrate how NBS translate ecological restoration into measurable economic returns, with benefit–cost ratios exceeding those of conventional engineered alternatives. For example, mangrove restoration programs in coastal communities, particularly in Southeast Asia, have generated multiple co-benefits, including stronger natural coastal defenses, increased fish stocks, and improved local livelihoods, all at a fraction of the cost of hard infrastructure such as dikes and embankments.

The East Calcutta waste treatment wetlands also demonstrate how NBS can deliver cost-effective outcomes and multiple benefits compared to traditional hard engineering approaches. Instead of relying on a highly automated wastewater treatment plant, the system channels wastewater through approximately 4,000 hectares of fish ponds. These ponds complete most of their biochemical reactions with the help of solar energy. Beyond water treatment, the wetland provides about 150 tons of fresh vegetables daily and approximately 10,500 tons of table fish per year. This system sustains livelihoods for about 50,000 people directly and a similar number indirectly.

Table 1: Projects Adopting NBS to Restore Biodiversity

Source: Vicarelli et al. (2024). 

This growing recognition of the economic advantages of nature-based solutions is already reflected in a wide range of policy initiatives and community-led efforts worldwide. From state-led regulatory frameworks such as People’s Republic of China’s (PRC) Ecological Red Lines, which aim to protect 30% of the country’s natural capital and biodiversity, to community-driven initiatives like mangrove and wetland restoration in the Philippines, which deliver storm protection, improved seafood yields, and ecotourism opportunities—the knowledge and practice of restoring and valuing wetland biodiversity is expanding.

Restoring wetlands and the biodiversity that underpins their functioning is relatively simple and cost-effective and delivers multiple social, economic, and environmental benefits. However, progress remains slow, while the twin crises of climate change and biodiversity loss continue to accelerate. Addressing these challenges requires decisive action across policy, governance, and finance.

Policy and governance recommendations

• Implement impactful measures such as PRC’s Ecological Red Lines and the EU Green Deal, supported by strong regulation and enforcement.
• Expand biodiversity through coherent, resilient ecological networks that are bigger, better, and more connected.
• Withdraw harmful subsidies and replace them with payments for public goods, incentivizing environmental protection.
• Establish clear requirements for biodiversity-based market mechanisms (e.g., biodiversity credits, green bonds) and regulate these markets effectively.
• Enforce strong regulations in protected areas to disrupt “business as usual” and require low-impact engineering solutions.

Financial and investment recommendations

• Address the disconnect between nature and biodiversity as investible asset classes; integrating NBS into infrastructure planning can help.
• Prioritize NBS in national projects and development banks, mandating their inclusion and providing capital for restoration and protection. 
• Build and strengthen ecological expertise and ecosystem-specific knowledge to design and implement these solutions effectively.
• Review safeguards and performance standards to ensure alignment with the Global Biodiversity Framework, assessing whether funds restore or deplete nature.
• Require major hydropower projects to adopt designs with minimal wetland impact, recognizing that large-scale dams may no longer align with Global Biodiversity Framework objectives.

Asian Development Bank. 2025. Asia-Pacific Climate Report 2025: Unlocking Nature for Development.

J. Mackinnon and L. Hatton. 2025. Our Most Valuable Ecosystem—Status and Conservation of Wetlands in the Asia and Pacific Region. Background paper for the Asia–Pacific Climate Report 2025: Unlocking Nature for Development. ADB.

M. Vicarelli et al. 2024. On the Cost-Effectiveness of Nature-Based Solutions for Reducing Disaster Risk. Science of The Total Environment. Volume 947.

R. Costanza et al. 2014. Changes in the Global Value of Ecosystem Services. Global Environmental Change. Volume 26, pp. 152-158. Elsevier Ltd.