World Bank Launches New Global Partnership to “Green” National Accounts

October 28, 2010

Nagoya, Japan, October 28, 2010 – The World Bank today announced a new global partnership that will give developing countries the tools they need to integrate the economic benefits that ecosystems such as forests, wetlands and coral reefs provide, into national accounting systems. The goal is to introduce the practice of ecosystem valuation into national accounts at scale so that better management of natural environments becomes “business as usual”.
Speaking in Nagoya, Japan at the Convention on Biological Diversity meeting, World Bank Group President Robert B. Zoellick said the alarming loss of biological diversity around the world can be partly attributed to the lack of proper value being placed on ecosystems and the services they provide. He said the new Partnership can provide the “missing information” on a country’s “natural capital” to guide leaders in decision-making.
"The natural wealth of nations should be a capital asset valued in combination with its financial capital, manufactured capital, and human capital," said Zoellick. “National accounts need to reflect the vital carbon storage services that forests provide and the coastal protection values that come from coral reefs and mangroves.”
“Through this new partnership, we plan to pilot ways to integrate ecosystem valuation into national accounts and then scale up what works to countries around the world.”
According to a forthcoming World Bank publication, The Changing Wealth of Nations, the economic value of farmland, forests, minerals and energy worldwide exceeds $44 trillion, with $29 trillion of that in developing countries. This value is primarily commercial, however. Other value lies in the services ecosystems such as forests provide, including hydrology regulation, soil retention, and pollination -- as a home to bees and other insects. Cutting down a forest for its timber may have negative consequences for other sectors of the economy, such as loss of agricultural productivity, loss of capacity for hydroelectric power, and loss of water quality.
The Global Partnership for Ecosystems and Ecosystem Services Valuation and Wealth Accounting builds on the United Nations Environment Programme project “The Economics of Ecosystems and Biodiversity” (TEEB) which, last week, released its final report. Among other things, TEEB concluded that the “invisibility” of many of nature’s services to the economy results in widespread neglect of natural capital, leading to decisions that degrade ecosystem services and biodiversity.
The new Partnership takes TEEB's work to the next level, developing the systems needed to bring the value of natural capital to the highest level of a country’s economic decision-making. By demonstrating ecosystem accounting at scale for a critical mass of countries, the World Bank envisions that the approach will eventually be adopted by many countries.
Valuing ecosystems in this way would change the calculation that a country would make, for example, in clearing mangroves for shrimp farming. The calculation would no longer simply be the revenue from profit on shrimp farming minus the farming costs. The loss to the economy of coastal protection from cyclones and the loss of fish and other products provided by mangroves would also be factored in.
The Partnership will include developed and developing countries, international organizations such as UNEP and conservation and development non-governmental organizations as well as the global organization for legislators, GLOBE International.

The initial five-year pilot will:

  • Demonstrate how countries can quantify the value of ecosystems and their services in terms of income and asset value
  • Develop ways to incorporate these values into planning and design of specific policies linking wealth and economic growth
  • Develop guidelines for the practical implementation of ecosystem valuation that can be applied around the world.

Launching the first phase of a partnership to “green” national accounts in a group of six to 10 countries – starting with Colombia and India – Zoellick was joined by Sandra Bessudo Lion, High Commissioner for the Environment, Colombia; Ryu Matsumoto, Minister of Environment, Japan; Erik Solheim, Minister of the Environment, Norway; Caroline Spelman, Secretary of State for the UK’s Department for Environment, Food and Rural Affairs; Vijai Sharma, Secretary in the Ministry of Environment and Forests, India; and Achim Steiner, Executive Director, United Nations Environment Programme (UNEP).
In Colombia and India, feasibility studies to identify priority ecosystems will start soon. Other countries in Africa, Asia, Latin America and Central Europe have indicated strong interest in being pilot countries under the Partnership.

Media Contacts
In Nagoya
Roger Morier
Tel : (+1 202) 369-1852
Tomoko Hirai
Tel : 090-5496-8066
In Washington
Elizabeth Mealey
Tel : (202) 458-4475