Challenge
For the 54 lower- and lower-middle-income coastal and island client countries of the World Bank, almost two-thirds of their total territory is ocean (as defined by offshore exclusive economic zones). For many of these countries, this ocean space is a crucial source of goods and services that can help end extreme poverty and promote shared prosperity. For example:
• West African countries’ waters, from Mauritania to Ghana, produce 1.6 million tons of fish per year, supporting over 3.2 million livelihoods, almost 10 percent of the GDP in Guinea-Bissau and Sierra Leone, and providing over 40 percent of animal protein intake in Gambia, Ghana, Guinea, Senegal and Sierra Leone.
• The coral triangle between Indonesia, Malaysia, Papua New Guinea, Philippines, the Solomon Islands and Timor-Leste, includes some of the planet’s highest biodiversity, on par with the Amazon rainforest, including 76 percent of all known coral species and over 3,000 fish species; with more than 120 million people in the region directly dependent on marine resources for income, livelihoods and food (coral reef-related fisheries in Indonesia and the Philippines alone are valued at around $2.2 billion per year, and reef-based tourism is valued at another $258 million annually).
• The Pacific Islands region that includes a number of our client small island developing states supplies one-third of the world’s tuna with a first-sale value of over $4 billion.
A healthy ocean is also fundamental to the global effort to mitigate climate change. The ocean is a major sink for anthropogenic emissions, absorbing 25 percent of the extra CO2 added to Earth's atmosphere by burning fossil fuels. For example, "blue carbon" sinks such as mangrove forests, sea grass beds and other vegetated ocean habitats can sequester up to five times the amounts of carbon absorbed by tropical forests.
However, many of our oceans are not healthy, and are contributing far less than they could be to the global effort to reduce poverty and boost shared prosperity. This is largely due to human actions diminishing the ability of underlying natural systems to provide optimal levels of ecosystem services. Ocean ecosystems are changing at a rate and scale not seen since the rise of modern civilization, due largely to anthropogenic drivers resulting from the inability of institutions to sustainably manage human actions.
The four key anthropogenic drivers of change in ocean ecosystem that have resulted from institutional weaknesses include:
• Overfishing: Technological improvements coupled with open access to fish stocks have led to roughly one-third of the world’s ocean fisheries being over-exploited or depleted. Fishing capacity is estimated to be 2.5 times greater than sustainable harvest levels. Through analysis by the Global Program for Fisheries (PROFISH), the World Bank and the Food and Agriculture Organization of the United Nations (FAO) estimated in 2009 that the lost potential economic benefits from marine fisheries for a single year could be as much as US$50 billion.
• Pollution: Nitrogen fertilizer application has increased fivefold since 1960, but as much as 50 percent of the nitrogen applied is lost to the environment, depending on how well the application is managed. Much of this excess runs off into rivers and streams and eventually to the ocean, resulting in algal blooms that consume most of the oxygen in the water. This has adverse effects on marine life, leading to ‘dead zones.’ There are now an estimated 405 ocean dead zones around the world, covering 246,000 square kilometers—an area larger than that of Great Britain.
• Habitat loss or conversion (for example, coastal development, coastal deforestation, fishing with dynamite, and mining): Ocean areas are experiencing some of the most rapid environmental change on the planet. An estimated 35 percent of mangrove area in countries with data on this aspect was either lost or converted between 1985 and 2005; and at least 20 percent of coral reefs have been destroyed globally in the last several decades, with another 20 percent having been degraded.
• Climate change and ocean acidification: Over the coming decades and centuries, ocean health will become increasingly stressed by rising seawater temperature, ocean acidification, and ocean de-oxygenation in ways that we are only beginning to understand. Coral bleaching, caused by rising ocean temperatures, is already affecting vast areas of tropical coral reefs, which harbor 25 percent of marine biodiversity.
Solutions
Although human actions are driving negative changes in the ability of the living oceans to contribute to global economic growth, they can also drive positive change to reverse this trend and rebuild the oceans’ natural capital. Most of these actions occur in the context of the institutions that govern the way ocean ecosystem services are valued and used. For this reason, the World Bank’s focus in helping to restore ocean health is to support developing countries to strengthen and reform the institutions needed to both enhance the benefits and services that healthy oceans can provide, and to ensure that these benefits contribute to poverty reduction and shared prosperity. This support generally follows five guiding principles:
• Sustainable livelihoods, social equity and food security, emphasizing the importance of marine ecosystems in delivering essential goods and services that underpin millions of livelihoods, social equity and food security;
• Healthy ocean and sustainable use of marine and coastal resources; ensuring investments contribute to the maintenance, restoration and enhancement of marine and coastal ecosystems, while recognizing that people are an essential part of the global ecosystem;
• Effective governance systems, supporting innovative systems that provide incentives to private and public sector leaders at all levels to engage and support a healthy ocean and community well-being;
• Long-term viability, making investments that are economically viable, socio-ecologically sustainable and promote positive, self-sustaining outcomes, especially when transitional funding or other GPO assistance ends; and
• Capacity building and innovation, aiming to build on local knowledge and develop innovative solutions, human resource capacity, educational tools and operating strategies, as well as new finance and policy vehicles.
Guided by these principles, the World Bank provides some $1 billion in financing for sustainable fisheries and aquaculture, and for efforts to conserve and enhance natural coastal and ocean habitats. This portfolio was launched in 2005 with support from a Global Program on Fisheries (PROFISH) to provide global knowledge and support to develop a number of fisheries and aquaculture investments. The Bank is seeking to expand its Program on Fisheries and Aquatic Resources (PROFISH+) to support innovation and reform in ocean financing, technology and governance. Additionally, the Bank provides some $5.4 billion in financing for coastal infrastructure (e.g. waste treatment), watershed management and other activities that help reduce the volume of pollution entering countries’ coastal waters.
In 2012-2013, the Bank produced a number of reports to support ocean-related lending activities: Fish to 2030, focusing on the changes in global demand (and supply) for fish over the coming decades, Growing Aquaculture in Sustainable Ecosystems, highlighting locally adapted aquaculture zone management, Evaluation of New Fishery Performance Indicators (FPIs), Hidden Harvest, the Global Contribution of Capture Fisheries, profiling the world’s small- and large-scale fisheries, and Indispensable Ocean: Aligning Ocean Health and Human Well-Being.
