Criminalising Ecocide as a Long-Term Macroeconomic Strategy
This guest blog is authored by Rafael Kemelmajer, an economist and co-founder of RITA (Regional Impact Trade Alliance).
In the contemporary global economy, the problem is no longer just the risk, but the illusion that it can continue to be externalised without cost. For too long, certain extreme damages were treated as isolated incidents or as the acceptable price of growth. Today, in a world of cascading shocks, transnational litigation, and exposed balance sheets, that fiction is no longer sustainable. Criminalising ecocide is not an ethical statement or a regulatory trend: it is an economic policy decision aimed at preventing today's growth from being financed by the destruction of tomorrow's value.
The Economics of Risk Has Changed
For decades, severe damage to ecosystems was treated as an externality: collateral, diffuse, and, above all, postponable costs. That assumption is no longer valid. Physical, legal, and reputational risks have become systemic, quantifiable, and increasingly immediate.
Sovereign wealth funds, global insurers, systemically important banks, and financial regulators no longer evaluate projects solely by their expected return, but by their exposure to extreme events, complex litigation, and the abrupt loss of territorial value. In this context, criminalising ecocide ceases to be a normative discussion and becomes an institutional signal about how an economy manages its tail risks.
The relevant question is no longer whether these risks exist, but who absorbs them when they materialise.
Ecocide: From Ethical Debate to the Macroeconomic Balance Sheet
Ecocide refers to acts committed with knowledge that there is a substantial likelihood of severe and either widespread or long-term damage to the environment. Making it a criminal offence introduces personal and corporate liability when certain critical thresholds are crossed.
From a macroeconomic perspective, this equates to protecting essential productive assets. Ecosystems are not just natural heritage: they are economic infrastructure. When they degrade, the impact does not disappear; it transforms into fiscal liabilities, supply shocks, drops in productivity, and persistent pressure on public spending.
Ignoring this link is to confuse growth with extraction.
The Economic Problem of Short-Termism
Certain investments continue to be defended in the name of jobs, competitiveness, or immediate profitability, even when they carry a high probability of irreversible damage. The problem is not rhetorical or ideological; it is economic.
These projects maximise short-term cash flows while destroying critical shocks: water, soil, territorial stability, and public health. When the damage materialises, private benefits are diluted, and the costs are socialised.
In strictly macroeconomic terms, these are projects with a negative expected value: concentrated profits versus persistent public losses. Criminalising ecocide forces that risk to become visible to the market and stops rewarding business models based on the systematic externalisation of costs.
When the Market Begins to Price Damage
The impact of ecocide becomes relevant to capital when it translates into prices, costs, and risk premiums:
Asset Value — After severe territorial crises, real estate prices can fall between 15% and 45%, eroding wealth, loan collateral, and local tax revenue.
Cost of Capital — Regions associated with persistent environmental conflicts face higher risk premiums.
Water and Energy — Watershed degradation has doubled water supply and treatment costs in some European countries in less than a decade, directly affecting business margins.
Economic Activity — Tourism, agriculture, and real estate often see income drops of 20% to 40% following such crises, with slow or incomplete recoveries.
In simple terms, massive damage dries up future cash flows. Criminalising ecocide seeks to preserve an economy's ability to generate sustained and predictable income.
Quantifiable Examples of Ecocide and Its Economic Impact
The link between ecocide and economic collapse is not theoretical. It is documented, measured, and, in some cases, insured:
Chernobyl (Europe, 1986): Beyond the human tragedy, the nuclear accident constituted an extreme case of ecocide with persistent macroeconomic consequences. In Belarus, the accumulated costs associated with lost productivity, healthcare, resettlements, and unusable territories are estimated at USD 235 billion. For years, Ukraine allocated between 5% and 7% of its national budget to expenses directly or indirectly linked to the event. Four decades later, the fiscal and territorial impact remains active.
Deepwater Horizon (Gulf of Mexico, 2010): The oil spill represented large-scale marine ecocide and one of the largest corporate liabilities in modern history. BP assumed between USD 40 and 60 billion in cleanup costs, fines, and compensation. This was compounded by persistent economic losses in fishing and tourism, with sectoral estimates exceeding USD 8 billion in commercial fishing alone. The event durably altered the regulatory risk profile of the offshore industry.
Piper Alpha (North Sea, UK, 1988): The oil platform explosion generated localised industrial ecocide with immediate and systemic economic consequences. Insured losses reached approximately GBP 1.7 billion, one of the largest industrial claims of the era. The impact went beyond the destroyed infrastructure: it led to deep regulatory changes, a structural increase in insurance costs, and a comprehensive review of the sector's operational standards.
These cases share a clear pattern: when ecocide exceeds certain thresholds, the initial private benefits quickly dissipate and the costs transform into public liabilities, loss of value, and erosion of institutional credibility. A single event of this magnitude can erase years of growth.
Biodiversity, Innovation, and Strategic Advantage
Beyond water and soil, biodiversity is a strategic economic asset. It is the genetic bank upon which industries like biotechnology, pharmacology, and advanced inputs for food production depend.
The degradation of ecosystems erodes the raw material for sectors worth trillions of dollars globally. Conversely, countries that protect these assets are safeguarding future natural patents and attracting investment in research and development. From this perspective, criminalising ecocide does not hinder innovation: it protects its pipeline.
Anticipating Global Standards
The debate is no longer hypothetical. In September 2024, Vanuatu, Fiji, and Samoa formally presented a proposal to the Assembly of States Parties of the International Criminal Court to recognise ecocide as the fifth international crime. The initiative, which uses the definition elaborated by an expert panel in 2021, has growing support (including from the Democratic Republic of the Congo) and is advancing in diplomatic discussions, although its adoption will require a qualified majority and could take several years.
Pioneering countries include France (which incorporated the crime in 2021) and Belgium (which explicitly recognised it in its new Penal Code in 2024, as the first European country to do so at the national and international level). In the United Kingdom, Scotland introduced the Ecocide (Scotland) Bill in May 2025, currently in Stage 1 of the parliamentary process, with a possible vote in 2025-2026.
The European Union adopted an Environmental Crime Directive in 2024 that obliges member states to criminalise conduct "comparable to ecocide" by May 2026.
For multinational corporations, operating in jurisdictions aligned with emerging standards is not an additional burden, but a direct way to mitigate legal, reputational, and financial risk.
A Systemic Insurance for the Economy
Criminalising ecocide not only disciplines high-risk projects; it also strengthens the rest of the productive system. It functions as collective insurance:
It reduces uncertainty for non-extractive sectors.
It protects the value of existing assets.
It improves predictability for talent and long-term investment.
From a macroeconomic standpoint, it is not about halting growth, but about improving its composition and resilience.
Does It Deter Investment?
Only investment predicated on externalising costs.
Capital that flees in the face of clear rules tends to be volatile, resource-intensive, and weakly anchored to the territory. The capital that remains is more knowledge-intensive, less exposed to reputational shocks, and more compatible with lasting productive linkages.
In the long run, that difference matters.
Competitive Advantage in the Long Term
Criminalising ecocide does not harden the economy or deter quality investment. It forces the market to internalise costs that already exist in the form of systemic risks, improving allocative efficiency and the resilience of balance sheets.
Economies that integrate this logic will gain a competitive advantage by attracting patient capital, high-value talent, and investment flows aligned with long-term horizons. Those who delay may maintain immediate returns in the short term, but expose their financial and productive systems to avoidable shocks that erode the very foundation of sustained prosperity.
In a world where institutional investors already prioritise territorial stability and tail risk management, recognising these costs is not interventionism: it is the prerequisite for lasting competitiveness.