The world’s oceans are in trouble. In late September, the Intergovernmental Panel on Climate Change reported that the oceans are warming, seawater is acidifying, and oxygen concentrations are dropping. Last week, another initiative, the International Program on the State of the Ocean, outlined the toll that these and other factors, such as destructive fishing and pollution, are having on marine life.

Ocean degradation is not as visible as deforestation, but it is at least as dangerous. The oceans provide at least half of the oxygen we breathe. They absorb more carbon dioxide than forests do. Harm to the oceans can have a tremendous global impact.

Degradation is particularly serious in the one substantial part of the world that is governed internationally – the high seas. These waters are outside maritime states’ exclusive economic zones; they comprise two-thirds of the oceans’ area, covering fully 45% of the earth’s surface.

The Global Ocean Commission, an independent initiative that I joined earlier this year, is reviewing the condition of the high seas. Next year, it will produce a set of recommendations concerning how to restore our oceans to full health and ecological productivity.

One of the first tasks is to quantify the economic losses caused by ocean degradation. Back in 1997, a pioneering paper by Robert Costanza and his colleagues put the overall value of marine ecosystem services at $21 trillion. Others have estimated that illegal fishing costs the global economy $10-23.5 billion per year, and poor management of fisheries $50 billion per year. But these figures are nearly a decade old; the Commission will update these estimates and make them more precise.

It is not enough to document that the losses are big. Obviously, the next question is what to do about it. No single official body has overall responsibility for the high seas. So, even if the economic losses turn out to be much higher than previous estimates, there are currently few effective mechanisms to bring about change. The basic pillar of ocean governance, the United Nations Convention on the Law of the Sea, was established 30 years ago. Since then, huge technological advances have occurred, and demand for resources has increased massively.

So stopping and reversing the degradation of the world’s oceans requires improved governance mechanisms, which must be used to enforce economically sensible and innovative solutions.

Here the experience of countries fighting against deforestation is helpful. Costa Rica arguably started a trend in the early 1990’s, when it began levying taxes on fossil fuels and using the revenue to protect forests. The net result was a reversal of deforestation. The economy has benefited directly through a growth in tourism, and indirectly by preserving ecosystem services such as pollination.

The concept of payment for ecosystem services is currently receiving attention from governments around the world. Costa Rica and Colombia have both signed up to a program funded by donor governments. Brazil has schemes that pay for protecting watercourses. An initiative called REDD (Reducing Emissions from Deforestation and Forest Degradation) would pay for ecosystem services on a global scale by rewarding forest conservation, thereby regulating climate change. These ideas should receive more attention in the future, as our supplies of non-renewable resources dwindle.

When the Global Ocean Commission issues its recommendations for reform next year, economics will be at their heart. Once we have more accurate data on the value of the ocean, we must decide how we use this information. Payment for ecosystem services could be a solution, though there are likely to be simpler options. But whichever mechanism is eventually adopted, we must also address the governance question: today’s inadequate system allows both economic and ecological losses to persist.

The Commission will share its recommendations with governments. There are tremendous costs associated with allowing the current laissez-faire regime to continue. We hope leaders understand that the world’s oceans – and the ecosystem services they provide – are too important to be allowed to fail.

The opinions expressed here are those of the author, not necessarily those of the World Economic Forum. Published in collaboration with Project Syndicate.

Author: Andrés Velasco, a former presidential candidate and finance minister of Chile, is Professor of Professional Practice in International Development at Columbia University’s School of International and Public Affairs.

Image: Smoke billows from a controlled burn of spilled oil off the Louisiana coast in the Gulf of Mexico coast line June 13, 2010. REUTERS/Sean Gardner