OA and National Budget Processes

TG-1.1 Section 1: Using Ocean Accounts in Decision-Making Applied Draft

Circular ID	TG-1.1
Version	7.0
Badge	Applied
Status	Draft
Last Updated	May 2026

1Framework Position

2TG-1.1 sits within Section 1 (Decision-Making) of the GOAP Technical Guidance and provides the fiscal planning bridge between ocean accounts compilation (Sections 3-6) and policy use. It draws on asset accounts (TG-3.1), economic activity accounts (TG-3.3), and government expenditure accounts (TG-3.8) to demonstrate to budget officials how ocean accounting data can inform national budget submissions, MTEF projections, and natural capital budgeting.

1. Outcome

1Readers will learn which accounts and indicators feed budget decisions, how to construct budget submissions using ocean accounting data, and how to present the economic case for public investment in marine resource management and ecosystem conservation.

2The guidance addresses three budget use cases. Natural capital budgeting uses asset accounts to quantify the value of ocean assets and changes in that value, so that governments can assess whether economic growth is achieved at the expense of depleting marine natural capital. Finance ministries can use depletion-adjusted net domestic product (NDP) calculations to demonstrate the natural capital cost of unsustainable fishing or offshore extraction, and to support budget allocations for resource management. Medium-term expenditure framework (MTEF) development requires multi-year projections of ocean economy contributions and asset trajectories. Asset accounts enable projection of fish stock biomass under alternative management scenarios, whilst ecosystem extent accounts track whether mangrove restoration investments will meet MTEF targets for coastal protection services. Budget line-item justification for fisheries enforcement, marine protected area management, or coastal infrastructure requires presenting sector economic contribution, asset status and trends, and expected returns to public expenditure. The quantitative evidence from ocean accounts strengthens these requests by grounding them in internationally standardised data.

2. Requirements

• 1TG-0.1 General Introduction to Ocean Accounts — provides foundational understanding of Ocean Accounts structure, including the distinction between stocks and flows, the relationship to the System of National Accounts (SNA) and System of Environmental-Economic Accounting (SEEA), and the multiple-capitals framework for wellbeing and sustainability
• 2TG-3.8 Government Activity Relevant to the Ocean — provides environmental activity accounts and CEPA/CReMA expenditure classifications used in Section 3.7 of this Circular to identify and track ocean-related government expenditure

3. Guidance Material

3.1 Ocean accounts and fiscal planning

1National budget processes typically follow an annual cycle comprising budget formulation, legislative approval, execution, and audit. In many countries, annual budgets operate within a Medium-Term Expenditure Framework (MTEF) that projects revenues and expenditures over a three-to-five year horizon. Ocean Accounts can inform both the annual and medium-term dimensions of fiscal planning by providing consistent, comparable data on (1) the contribution of ocean-related sectors to national production and income, (2) the stocks of natural capital assets in marine and coastal areas, (3) the flows of ecosystem services from ocean environments, and (4) the depletion or enhancement of marine resource assets over time.

2The 2025 SNA gives increased prominence to net income measures and now treats depletion of natural resources as a cost of production alongside depreciation¹. Net Domestic Product (NDP) subtracts both depreciation and depletion from GDP, and is identified as the conceptually preferred measure of economic growth for sustainability purposes². For ocean-rich countries, this change has direct implications for fiscal planning: the extraction of marine resources such as fish stocks or seabed minerals now affects measured net income, and budget planners gain a clearer indication of the sustainability of resource-dependent revenue streams.

3Most countries currently compile national accounts under SNA 2008, which does not treat depletion as a cost of production. Depletion-adjusted ocean GVA measures prepared using this Circular should be presented as ocean accounts supplementary measures, clearly distinguished from official GDP and NDP. This framing is consistent with the SEEA Central Framework supplementary account approach and avoids pre-empting national statistical office SNA 2025 transition timelines.³

3.2 From accounts to budget decisions: which data feed fiscal planning

1Four Ocean Accounts modules feed the three calculation steps that translate accounts into budget evidence: the depletion adjustment, ecosystem service valuation, and expenditure classification. Figure 1.1.1 maps these many-to-many linkages.

Figure 1.1.1 Four Ocean Accounts modules feed three calculation steps that support three budget applications. Stage colours mark account inputs, calculation steps, and budget applications; edges are many-to-many. Source: TG-1.1 §3 (account-to-budget mapping); §3.4 (net ocean GVA / depletion); §3.7 (CEPA / CReMA / COFOG expenditure classification). Modules per TG-3.1 (assets), TG-3.2 (services), TG-3.3 (ocean economy), TG-3.8 (government activity). Adapted from: SNA 2025 Ch.15 & Ch.22 (depletion as a cost of production; government finance interface); OECD (2022) Green Budgeting Framework.

Asset accounts feed natural capital budgeting

1Asset accounts provide the quantitative foundation for assessing whether ocean economic growth is sustainable or whether it draws down marine natural capital. Three specific account entries are particularly relevant:

2Physical fish stock accounts (TG-3.1 Section 3.4.1) record opening stock, natural growth, gross catch, natural mortality, and closing stock in tonnes of biomass. Depletion is derived as gross catch minus sustainable yield, and indicates whether extraction exceeds regeneration⁴. A fisheries ministry budget submission can state: “Commercial fish stocks declined from 180,000 tonnes to 176,800 tonnes during 2025, with catch of 24,000 tonnes exceeding sustainable yield of 22,000 tonnes by 2,000 tonnes, indicating depletion. Stabilising stocks requires increased management expenditure of $X million annually.” This statement draws directly from the physical asset account structure in TG-3.1 Table 1.

3Monetary fish stock accounts (TG-3.1 Section 3.3) translate physical depletion into monetary terms by multiplying depletion in tonnes by the resource rent per tonne. If resource rent is $450 per tonne and depletion is 2,000 tonnes, the monetary value of depletion is $900,000. This figure should be deducted from gross ocean GVA to calculate net ocean GVA for inclusion in MTEF projections. The calculation procedure is specified in Section 3.4 below.

4Ecosystem asset accounts (TG-3.1 Section 3.5) record the extent and condition of marine ecosystems that provide coastal protection, carbon sequestration, and other services relevant to budget decisions. If mangrove extent declined by 3.2 km2 during 2025 (TG-3.1 Table 5), and each hectare provides coastal protection services valued at $12,000 per year (TG-3.1 worked example), the annual loss of coastal protection capacity is $384,000. This figure can justify budget requests for mangrove restoration by quantifying the replacement value of protection services that have been lost.

Ocean economy accounts feed sector contribution evidence

1Ocean economy thematic accounts compiled under TG-3.3 Economic Activity provide the data to demonstrate the ocean sector’s contribution to national income, employment, and exports. The derivation procedure from supply and use tables (SUTs) to budget indicators is detailed in TG-2.5 Section 3.7. The resulting indicators populate Table 1 in Section 3.3 below.

Flow accounts feed environmental expenditure tracking

1Environmental activity accounts described in TG-3.8 Combined Presentations enable tracking of government spending on ocean-related environmental activities. These accounts classify expenditure using the Classification of Environmental Protection Activities and Expenditure (CEPA) and the Classification of Resource Management Activities (CReMA)⁵. For budget purposes, the accounts identify:

2Marine protected area management expenditure is classified under CEPA 6 (Protection of biodiversity and landscapes). A budget submission can state: “Government expenditure on marine protected area management totalled $8.2 million in 2025, protecting 72,000 hectares of marine ecosystems that provide $23 million annually in ecosystem services (coastal protection, carbon sequestration, fish nursery habitat).” The expenditure figure comes from functional accounts. The ecosystem service values come from ecosystem service flow accounts in TG-3.2.

3Fisheries management expenditure is classified under CReMA resource management activities. A budget submission can compare management expenditure to the value at risk: “Fisheries management expenditure of $5.5 million protects an ocean fishing sector contributing $175 million GVA and employing 32,000 persons. Fish stock asset value is estimated at $73 million based on net present value of sustainable yield.”

3.3 Quantifying ocean contributions to national income

1An ocean economy thematic account disaggregates ocean-related economic activities that are often hidden within broader classifications in standard national accounts⁶. For the thematic and extended accounts framework (SNA 2025 Chapter 38), see TG-0.2 Standards and Frameworks. The ocean economy thematic account is a thematic account in the SNA 2025 sense: it disaggregates and rearranges items within the SNA integrated framework rather than expanding its boundaries.

2The account identifies industries and products that are ‘ocean-related’, either because they take place in marine areas, use marine resources as inputs, or produce goods and services specifically for ocean activities⁷. The specific activities included will vary according to national circumstances. Countries with large exclusive economic zones may place greater emphasis on offshore extraction and deep-sea activities, whilst small island developing States may prioritise coastal tourism and artisanal fisheries. The SEEA Ecosystem Accounting framework provides guidance on defining ocean-related activities in Section 13.5, and the GOAP Technical Guidance encourages countries to document their classification choices transparently so that cross-country comparisons can account for differences in scope⁸. The classification should be applied consistently over time so that trend data remain meaningful.

3Key ocean-related activities typically include:

• 4Marine fishing and aquaculture
• 5Offshore mineral and energy extraction (including petroleum, natural gas, and emerging marine renewable energy)
• 6Maritime transport (shipping, port services)
• 7Shipbuilding and marine equipment manufacturing
• 8Coastal tourism and recreation
• 9Marine and coastal construction
• 10Ocean research and education

11For each activity, the thematic account records output, intermediate consumption, gross value added, compensation of employees, and other standard economic variables. The sum of gross value added across all ocean-related activities provides a measure of the ocean economy’s direct contribution to GDP.

Compilation procedure: from national SUTs to budget indicators

1The following step-by-step procedure enables compilers to extract ocean economy data from national supply and use tables and derive the indicators required for budget presentations. This procedure is adapted from the SF-MST approach to measuring tourism economic contribution⁹ and is described in full in TG-2.5 Section 3.7.

2Step 1: Identify ocean economy industries by ISIC code. Using the TG-3.3 Section 3.4 concordance (Industry Classifications), identify all ISIC classes that constitute the ocean economy in the compiling country. For each class, determine whether it is wholly ocean-dependent (ocean ratio = 1.0) or partially ocean-related (ocean ratio < 1.0). For example:

• 3ISIC 0311 (Marine fishing): ocean ratio = 1.0 (wholly ocean-dependent)
• 4ISIC 5510 (Short-term accommodation): ocean ratio = 0.40 (40% attributable to coastal tourism in illustrative case)

5Step 2: Extract ocean economy sub-matrices from national SUTs. From the balanced national supply and use tables, extract the columns corresponding to identified ocean economy industries. This creates an ocean economy supply table and use table that are subsets of the national tables.

6Step 3: Determine the ocean economy ratio for each industry. For partially ocean-related industries, estimate the share of output directly attributable to ocean-related activity. Methods for estimating this ratio fall in the following recommended order of preference:

1. 7Establishment-level survey data (TG-4.2 Survey Methods) — preferred where surveys covering ocean-related businesses are available
2. 8Statistical proxy (e.g. tourism satellite account coastal ratios) — acceptable alternative where establishment surveys are not feasible
3. 9Expert judgement informed by administrative records — admissible only where neither survey data nor statistical proxies are available, and must be documented with the rationale, data sources consulted, and a sensitivity range

10Whichever method is used, compilers should record the method and key assumptions in a metadata annex consistent with TG-4.2 survey documentation standards.¹⁰

11Step 4: Calculate Ocean Economy Direct GVA. For each ocean industry, multiply the industry’s gross value added from the Use Table by its ocean economy ratio:

12$$\text{Ocean Economy Direct GVA} = \sum_i (\text{GVA}_i \times \text{Ocean ratio}_i)$$

13Step 5: Adjust for taxes less subsidies on products. To derive Ocean Economy Direct GDP from Ocean Economy Direct GVA, add the ocean-related share of taxes less subsidies on products:

14$$\text{Ocean Economy Direct GDP} = \text{Ocean Economy Direct GVA} + \text{Ocean share of (taxes - subsidies on products)}$$

15Two methods are acceptable for estimating the ocean share of taxes less subsidies on products:

• 16(a) Direct extraction: Where fisheries subsidy data are available from the national fisheries agency or international databases (e.g. OECD Fisheries Support Estimate (FSE) database, which disaggregates fuel tax rebates and direct payments by country, or WTO Fisheries Subsidies Database for notified subsidies), apply these figures directly to the ocean sector.
• 17(b) Proportional allocation: Where direct data are unavailable, allocate total taxes less subsidies on products proportionally to the ocean economy’s share of national GVA, following the procedure in TG-2.5 Section 3.7 Step 5. Note that proportional allocation underestimates subsidised sectors (e.g. fuel rebates for commercial fishing). This limitation should be disclosed when this method is used.¹¹

18Step 6: Derive employment and export indicators. Using the same ocean economy ratios, multiply the labour inputs row by ocean ratios to obtain ocean employment, and sum the Exports column across ocean-characteristic product rows to obtain ocean exports.

Budget presentation table

1Table 1 presents the standard format for presenting ocean economy contribution in national budget submissions. This format implements the four-row structure specified in Section 3.3 of this Circular and is populated using the indicators derived in Steps 4-6 above.

2Table 1: Ocean economy contribution — budget presentation format

Indicator	Ocean economy	National total	Ocean share (%)
GDP contribution (USD million)	1,750	50,000	3.5
Employment (thousand persons)	300	10,000	3.0
Exports (USD million)	620	12,000	5.2
Fish protein supply (thousand tonnes)	285	340	83.8

3Note: Values are illustrative synthetic data for a medium-income coastal state. Compilers should replace these with data derived from national ocean accounts following the compilation procedure described above.

4The fish protein supply row represents total marine fish supply available for human consumption. This figure is derived conceptually as total marine fish catch, less exports of fish products and non-food uses (fishmeal, industrial use), multiplied by a species-mix-weighted protein conversion factor. Compilers should refer to FAO food balance sheet methodology for the operational procedure and FAO food composition tables for protein conversion factors.¹² Where fish constitutes a major share of national protein consumption, this indicator demonstrates the ocean sector’s contribution to food security and can justify budget allocations for fisheries management that maintain this contribution.

3.4 Net ocean GVA: accounting for natural capital depletion

1Gross measures of ocean economy value added do not account for the depletion of the marine natural resources on which many ocean industries depend. The SNA 2025 treats depletion of non-produced natural resources as a cost of production (SNA 2025 Chapter 15, para 15.137), and identifies net domestic product (NDP) as the conceptually preferred measure of economic growth¹³. This treatment matters for the ocean economy, as fisheries, offshore minerals, and other extractive ocean industries draw down natural capital stocks.

2Net ocean GVA is defined as:

3$$\text{Net ocean GVA} = \text{Gross ocean GVA} - \text{Depletion of marine natural resources}$$

4Depletion of marine natural resources includes:

• 5Depletion of fish stocks — the decline in the economic value of fish stock assets due to harvesting in excess of natural regeneration
• 6Depletion of seabed minerals — the decline in the economic value of offshore mineral and hydrocarbon reserves due to extraction

7This Circular covers only fish stock and seabed mineral depletion. Coastal and benthic habitat degradation (e.g. trawl damage, coral bleaching) represents a distinct category of natural capital cost: the decline in ecosystem asset value due to condition loss. This category is excluded from the net ocean GVA calculation here. Countries should consult TG-3.1 Asset Accounts Section 3.5 for ecosystem condition and degradation accounting. Countries unable to integrate ecosystem degradation should disclose the omission explicitly in their budget submissions, noting the potential for systematic understatement of natural capital costs in reef-dependent or trawl-intensive economies.¹⁴

Calculation procedure for fish stock depletion

1The following procedure enables compilers to calculate monetary depletion from physical fish stock asset accounts:

2Step 1: Obtain physical depletion from asset accounts. From the physical fish stock asset account (TG-3.1 Section 3.4.1), extract:

• 3Gross catch (tonnes)
• 4Sustainable yield (tonnes)
• 5Physical depletion = Gross catch - Sustainable yield (tonnes)

6If gross catch is 24,000 tonnes and sustainable yield is 22,000 tonnes, physical depletion is 2,000 tonnes.

7Compilers should use Maximum Sustainable Yield (MSY) as the default reference point for sustainable yield, sourced from stock assessment outputs in TG-6.7 Fisheries Stock Assessment. An alternative reference point may be substituted where national policy or legislation defines a different indicator, provided the choice is documented. Such alternatives include Maximum Economic Yield (MEY), precautionary reference points (B_pa/F_pa), and nationally legislated target reference points. Consistent application of the reference point across periods is essential for depletion trend comparability.¹⁵

8Step 2: Estimate resource rent per tonne. Resource rent is the surplus remaining after deducting all costs of fishing from the gross value of catch¹⁶. It is estimated as:

9$$\text{Resource rent per tonne} = \frac{\text{Gross value of landings} - \text{(Operating costs + Depreciation + Normal return to capital)}}{\text{Total catch (tonnes)}}$$

10Normal return to capital is estimated as the risk-free rate applied to the replacement value of the fishing fleet (SEEA CF para 5.114).

11If gross value of landings is $28.8 million (24,000 tonnes at $1,200 per tonne average price), and total fishing costs are $18 million (including labour, fuel, vessel depreciation, normal return to capital), resource rent is $10.8 million. Resource rent per tonne is $10.8 million / 24,000 tonnes = $450 per tonne.

12Step 3: Calculate monetary depletion. Multiply physical depletion by resource rent per tonne:

13$$\text{Monetary depletion} = \text{Physical depletion (tonnes)} \times \text{Resource rent per tonne}$$

14Monetary depletion = 2,000 tonnes x $450/tonne = $900,000

15Step 4: Calculate net ocean GVA. Subtract total depletion (fish plus minerals if applicable) from gross ocean GVA:

16If gross ocean GVA is $1,750 million and total depletion (fish $0.9 million + offshore minerals $60 million) is $60.9 million, net ocean GVA is $1,689.1 million, a reduction of 3.5% from the gross figure.

Budget application of net measures

1The difference between gross and net ocean GVA indicates the extent to which the ocean economy’s recorded economic contribution depends on the drawdown of natural capital. Finance ministries can use this information to assess:

• 2Whether ocean sector growth rates are sustainable or are achieved by depleting assets
• 3The fiscal sustainability of revenue streams dependent on resource extraction
• 4The magnitude of management investment required to stabilise stocks and protect future income flows

5For MTEF purposes, projected net ocean GVA under alternative policy scenarios provides a more realistic basis for revenue forecasting than gross measures alone. If current depletion rates continue, the $60.9 million annual natural capital cost will grow and erode the sector’s net contribution. Budget submissions can state: “Stabilising fish stocks to eliminate depletion would protect $900,000 annually in natural capital value, requiring estimated management expenditure of $2.5 million annually. The $900,000 in avoided annual depletion represents a direct return of 36 cents per dollar of management expenditure from natural capital preservation alone. When the broader economic benefits of maintaining the $175 million GVA fishing sector and 32,000 jobs are considered, the case for investment is substantially stronger.”

3.5 Building budget requests using ocean data

Worked example: marine protected area expansion budget submission

1This worked example demonstrates how to construct a complete budget submission for marine protected area (MPA) expansion using data from ocean accounts. The example uses synthetic data for a hypothetical coastal state seeking to expand MPA coverage from 15% to 30% of territorial waters over a three-year MTEF period, in line with global Target 3 of the Kunming-Montreal Global Biodiversity Framework.

2Context and policy objective: The government seeks to expand marine protected area coverage from the current 15% (450 km2 out of 3,000 km2 territorial waters) to 30% (900 km2) by 2028. The Ministry of Environment prepares a budget submission for the MTEF 2026-2028 requesting $15 million capital expenditure for MPA establishment and $3 million annually for ongoing management.

3Step 1: Quantify ecosystem services from existing MPAs. Using ecosystem service flow accounts (TG-3.2), the compilers estimate that existing MPAs provide:

• 4Coastal protection services: 50 km of coastline protected, avoiding $8 million annually in storm damage
• 5Carbon sequestration: 15,000 tonnes CO2 sequestered annually, valued at $50/tonne = $750,000
• 6Fish nursery habitat: Spillover effects support commercial fishing worth $5 million GVA annually
• 7Tourism services: 80,000 visitor-days annually, generating $4 million in coastal tourism revenue

8Total ecosystem service value from existing MPAs: $17.75 million annually. Per-hectare service value: $17.75 million / 45,000 hectares = $394 per hectare per year.

9Step 2: Project service benefits from MPA expansion. Projecting benefits from MPA expansion requires accounting for the likelihood that additional areas will differ from existing MPAs in ecosystem condition and productivity. Where ecosystem condition accounts (TG-3.1 Section 3.5 condition scores) are available for proposed expansion areas, compilers should weight the per-hectare service values by relative condition scores rather than applying a flat proportional scalar. Where condition data for expansion areas are unavailable, a marginal productivity discount is appropriate: the evidence indicates that MPA expansion into adjacent or lower-priority areas tends to yield below-average per-hectare service values¹⁷. A discount of 70% of the existing per-hectare average is used as a working assumption in this example. That assumption must be disclosed, and a sensitivity analysis across 50—100% of the average per-hectare value should be presented alongside the central estimate. For guidance on spatial adjustment of service values, see TG-1.9 Valuation.

10Applying a 70% marginal productivity factor: additional 45,000 hectares × $394/ha/yr × 0.70 = approximately $12.4 million in additional annual ecosystem services. For comparison, the upper bound (100% factor, fully proportional) is $17.75 million, and the lower bound (50% factor) is $8.9 million.

11Step 3: Calculate net present value of benefits. Using a 4% real discount rate consistent with TG-1.9 Valuation guidance, and assuming a 25-year planning horizon for management commitments:

12$$\text{NPV of benefits} = \text{Annual service flow} \times \frac{1 - (1 + r)^{-n}}{r}$$

13Where r = 0.04 and n = 25:

14Central estimate: $12.4 million × 15.622 = $193.7 million Upper bound (100% factor): $17.75 million × 15.622 = $277.3 million Lower bound (50% factor): $8.9 million × 15.622 = $139.0 million

15Step 4: Calculate net present value of costs. Capital costs of $15 million occur in years 0-2, with $5 million payable at the beginning of each year: year 0, year 1, year 2. Annual management costs of $3 million continue for 25 years.

16$$\text{NPV of capital costs} = 5 \times (1 + \frac{1}{1.04} + \frac{1}{1.04^2}) = 5 \times 2.886 = 14.43 \text{ million}$$

17Note: this formula assumes beginning-of-year payments. Compilers replicating this calculation with end-of-year payment conventions should use the factor (1/1.04 + 1/1.04² + 1/1.04³) = 2.775, yielding $13.88 million.

18$$\text{NPV of management costs} = 3 \times 15.622 = 46.87 \text{ million}$$

19$$\text{Total NPV of costs} = 14.43 + 46.87 = 61.3 \text{ million}$$

20Step 5: Calculate benefit-cost ratio and present budget case.

21Central estimate: $193.7 / $61.3 = 3.16 Upper bound (100% factor): $277.3 / $61.3 = 4.52 Lower bound (50% factor): $139.0 / $61.3 = 2.27

22Note: The step-by-step figures above are authoritative. The budget submission narrative below rounds to one decimal place (3.16 → 3.2; 4.52 → 4.5; 2.27 → 2.3; $193.7M → $194M) for readability. Compilers replicating this example should carry unrounded figures through the calculation and apply rounding only in the final narrative.

23Budget submission narrative: “The Ministry of Environment requests $15 million capital expenditure over 2026-2028 and $3 million annually for ongoing management to expand marine protected area coverage from 15% to 30% of territorial waters. This expansion will approximately double the supply of coastal protection, carbon sequestration, fish nursery, and tourism services currently valued at $17.75 million annually from existing MPAs. Applying a marginal productivity discount of 70% (to account for the likelihood that expansion areas have lower average productivity than existing MPAs), the expected additional annual service flow is $12.4 million. Using a 4% discount rate over 25 years, the central-estimate NPV of benefits is $194 million against costs of $61 million, yielding a benefit-cost ratio of 3.2 (range: 2.3 to 4.5 depending on marginal productivity assumption). This investment aligns with global Target 3 of the Kunming-Montreal Global Biodiversity Framework and will contribute to national commitments under the UN Convention on Biological Diversity. Physical accounts indicate that existing MPAs cover 45,000 hectares, and ecosystem extent accounts will track the addition of 45,000 hectares of protected area under the expansion programme, with condition monitoring to verify that service supply targets are achieved.”

Three decision use cases

1Beyond MPA expansion, budget officials regularly face three additional decision use cases where ocean accounts provide the supporting evidence:

2Use case 1: Fisheries management budget justification. A national fisheries agency seeks increased budget allocation for stock assessment and enforcement activities. Using the net GVA figure and depletion calculation derived in Section 3.4, a budget submission can state: “Fish stocks declined 9.5% in 2025 due to catch exceeding sustainable yield. At current depletion rates, the sector’s economic contribution will decline 25% over the MTEF period. Increased management expenditure of $2.5 million annually will stabilise stocks through enhanced monitoring and enforcement, protecting the sector’s contribution to GDP and employment.”

3Use case 2: Coastal protection infrastructure investment. A ministry of public works evaluates whether to invest in seawall construction or mangrove restoration for coastal protection. Using Ocean Accounts data:

• 4Ecosystem extent account records 500 km2 of mangroves providing coastal protection services (TG-3.1)
• 5Ecosystem service valuation estimates mangroves provide protection equivalent to $12,000 per hectare per year
• 6Engineering cost estimate for equivalent seawall is $25 million per 10 km of coastline
• 7Mangrove restoration cost estimate is $8,000 per hectare

8Budget submission: “Ecosystem accounts indicate that existing mangroves provide coastal protection services worth $600 million annually (50,000 hectares × $12,000/ha/year). For context, the NPV of this annual flow at 4% over 25 years is approximately $9.4 billion. Restoring 250 hectares of degraded mangrove at $8,000/ha (total $2 million) can provide coastal protection comparable to approximately 2.5 km of seawall costing $6.25 million, depending on local conditions such as wave exposure and ecosystem health, whilst also supplying carbon sequestration and fish nursery services not provided by grey infrastructure.”

9Use case 3: Medium-term revenue forecasting for resource extraction. A ministry of finance prepares MTEF revenue projections dependent on offshore oil extraction royalties. Using Ocean Accounts data:

• 10Mineral asset account records proved reserves of 100 million barrels with 15-year extraction profile
• 11Gross revenue from extraction is projected at $6 billion over MTEF period
• 12Monetary depletion is $4.8 billion (80% of resource rent flows to asset depletion, not income)
• 13Net revenue contribution to government (royalties and taxes) is $600 million over MTEF period

14Budget submission: “Offshore extraction generates substantial gross revenue but also depletes the national mineral asset base. Asset accounts indicate that 80% of resource rents represent depletion rather than income. MTEF revenue projections should account for the finite nature of reserves and declining production profile. Diversification investments funded from current resource revenues are needed to maintain fiscal capacity beyond the 15-year extraction horizon.”

3.6 Integration with MTEF and annual budgets

1Ocean Accounts support MTEF development because the accounts structure supports temporal comparison and trend analysis. Asset accounts record opening and closing stocks, enabling projection of future asset values under different management scenarios. Supply and use tables for ecosystem services provide baseline data for estimating the future flow of benefits from marine ecosystems.

2To integrate Ocean Accounts with MTEF processes, budget officials should:

3Establish baseline accounts: Compile or obtain baseline ocean economy thematic accounts and relevant asset accounts for the most recent period for which complete data are available. These baselines serve as the reference point for projecting future contributions and assessing trends.

4Project asset and income trajectories: Using the asset account structure, project forward the expected stocks of key marine assets (fish stocks, mangrove extent, coral reef condition) under current management policies. Combine this with projections of ocean economy GDP contribution to estimate the medium-term fiscal significance of the ocean sector. The worked example in Section 3.5 illustrates this projection approach for marine protected areas.

5Identify decision points: Use the accounts to identify decision points where changes in management expenditure or policy could affect asset trajectories. For example, where fish stock accounts record declining trends that will cross a sustainability threshold within the MTEF period, the accounts provide a rationale for increased management investment. The threshold can be defined as the stock biomass at maximum sustainable yield (BMSY) from stock assessment models (TG-6.7).

6Align reporting periods: Ensure that ocean accounting compilation cycles align with MTEF and annual budget preparation timelines. Ideally, accounts are updated at least annually and available to budget officials during the formulation phase of the budget cycle. For annual budget integration, the key requirement is timely availability of accounting data. Many countries compile national accounts with a lag of one to two years, and environmental accounts may have additional delays. Countries seeking to use Ocean Accounts in budget processes should prioritise timeliness in their compilation programmes, and may use provisional or ‘flash’ estimates for recent periods to inform current budget decisions. Guidance on data quality requirements for provisional estimates will be addressed in TG-0.1 General Introduction. Budget submissions using provisional ocean account data should indicate clearly that the figures are subject to revision.

3.7 Government expenditure on ocean-related functions

1Government expenditure on ocean-related activities can be identified using the Classification of the Functions of Government (COFOG)¹⁸. Table 2 maps specific COFOG classes to ocean-related government functions, adapted from the SF-MST approach to identifying tourism-related government functions¹⁹.

2Table 2: COFOG classes relevant to ocean economy functions

COFOG Division	COFOG Class	Ocean-related function
01 General public services	01.3 General services	Maritime administration, hydrographic services
03 Public order and safety	03.1 Police services	Coast guard, maritime enforcement
04 Economic affairs	04.2 Agriculture, forestry, fishing	Fisheries management, aquaculture support
04 Economic affairs	04.5 Transport	Maritime transport infrastructure, port development
04 Economic affairs	04.7 Other industries	Marine biotechnology, ocean industry support
05 Environmental protection	05.1 Waste management	Marine pollution remediation
05 Environmental protection	05.2 Wastewater management	Coastal wastewater treatment
05 Environmental protection	05.4 Protection of biodiversity	Marine protected area management
06 Housing and community	06.3 Water supply	Desalination
07 Health	07.4 Public health services	Marine food safety
08 Recreation, culture	08.1 Recreational and sporting	Coastal recreation infrastructure
09 Education	09.4 Tertiary education	Maritime education and training
10 Social protection	10.5 Unemployment	Fisheries worker adjustment programmes

3Many COFOG classes in Table 2 are mixed: they cover both ocean-related and non-ocean functions within the same classification. Compilers must estimate an ocean share for each mixed class before summing expenditure across classes. Applying Table 2 without ocean-share adjustment will overstate ocean-related public expenditure. For each mixed class, the ocean share should be estimated nationally using the most relevant administrative data (for example, the fisheries share of the agricultural ministry budget for COFOG 04.2, and the proportion of police personnel assigned to maritime units for COFOG 03.1) and documented in the metadata annex, consistent with the methodology in SF-MST Table 3.9.¹⁹ Classes that are fully dedicated to ocean functions may be assigned an ocean ratio of 1.0.

4For detailed guidance on compiling environmental protection expenditure accounts and tracking government expenditure by environmental purpose, see SEEA CF Chapter IV⁵ and TG-3.8 Government Activity Relevant to the Ocean.

4. Acknowledgements

1This Circular has been approved for public circulation and comment by the GOAP Technical Experts Group in accordance with the Circular Publication Procedure.

2Authors: [To be confirmed]

3Reviewers: [To be confirmed]

5. References

Footnotes

1. 1

   United Nations. (2025). System of National Accounts 2025, Annex 4, para A4.59: “Depletion of non-produced natural resources is recorded as a cost of production in the 2025 SNA, instead of the 2008 SNA treatment as other changes in the volume of assets.” ↩

2. 2

   United Nations. (2025). System of National Accounts 2025, Annex 4, para A4.10: “The volume change of net domestic product (NDP) has been identified as the conceptually preferred measure of economic growth.” ↩

3. 3

   United Nations et al. (2014). System of Environmental-Economic Accounting 2012: Central Framework, para 1.1 (supplementary account approach). United Nations. (2025). System of National Accounts 2025, Annex 4 para A4.59. See also SNA 2008 Chapter 10 for treatment of other changes in volume of assets under the 2008 framework. ↩

4. 4

   SEEA CF, para 5.75-5.78. For renewable resources, depletion occurs when “the extraction of the natural resource is occurring at a level greater than that of regeneration.” ↩

5. 5

   United Nations et al. (2014). System of Environmental-Economic Accounting 2012: Central Framework, Chapter IV: Environmental activity accounts and related flows. ↩ ↩²

6. 6

   Colgan, C.S. (2016). Measurement of the ocean economy from national income accounts to the sustainable blue economy. Journal of Ocean and Coastal Economics, 2(2), Article 12. ↩

7. 7

   United Nations. (2025). System of National Accounts 2025, Chapter 38: Thematic and extended accounts. ↩

8. 8

   United Nations. (2021). System of Environmental-Economic Accounting—Ecosystem Accounting, Section 13.5: Ocean accounts. ↩

9. 9

   World Tourism Organization (2024). SF-MST, paras 2.30-2.31, 3.27-3.28 on measuring tourism direct GDP and the tourism ratio approach. ↩

10. 10

    United Nations World Tourism Organization & United Nations Statistics Division. (2024). Statistical Framework for Measuring the Sustainability of Tourism, paras 2.30-2.31 (tourism ratio methodology and documentation requirements). ↩

11. 11

    United Nations. (2025). System of National Accounts 2025, Chapter 38. United Nations World Tourism Organization & United Nations Statistics Division. (2024). Statistical Framework for Measuring the Sustainability of Tourism, paras 3.27-3.28. ↩

12. 12

    Food and Agriculture Organization of the United Nations. Food Balance Sheets: A Handbook. FAO, Rome. Available at: https://openknowledge.fao.org/handle/20.500.14283/x9892e. FAO food composition tables provide species-mix-weighted protein conversion factors for fisheries products. ↩

13. 13

    United Nations. (2025). System of National Accounts 2025, Chapter 15, para 15.137: “Gross value added minus depreciation of fixed assets minus depletion of non-produced natural resources equals net value added.” ↩

14. 14

    United Nations. (2021). System of Environmental-Economic Accounting—Ecosystem Accounting, Chapter 9: Ecosystem degradation accounting. See also SEEA EA Chapter 7 for ecosystem services in the context of ecosystem accounting. ↩

15. 15

    SEEA CF, para 5.75-5.78. United Nations. (2021). System of Environmental-Economic Accounting—Ecosystem Accounting. See TG-6.7 Fisheries Stock Assessment for the stock assessment outputs table and correspondence of biological reference points to physical depletion calculation. ↩

16. 16

    SEEA CF, para 5.113-5.114. “Resource rent is the economic rent that accrues in relation to environmental assets, including natural resources.” Resource rent for fisheries is the surplus after deducting operating costs, depreciation, and normal return to capital from the gross value of landings. ↩

17. 17

    Brander, L.M. et al. (2011). Using Meta-Analysis and GIS for Value Transfer and Scaling Up: Valuing Climate Change Induced Losses of European Wetlands. Environmental and Resource Economics (Springer). DOI: 10.1007/s10640-011-9535-1. Brander, L.M. et al. (2019). The global costs and benefits of expanding Marine Protected Areas. Marine Policy, 116. DOI: 10.1016/j.marpol.2019.103423. ↩

18. 18

    United Nations (2000). Classification of the Functions of Government (COFOG). In Classifications of Expenditure According to Purpose. Statistical Papers Series M No. 84. New York: United Nations. ↩

19. 19

    World Tourism Organization (2024). SF-MST, Table 3.9 on “Tourism related Functions of Government—COFOG classes.” The mapping in Table 2 adapts this approach for ocean economy functions. SF-MST Table 3.9 also provides guidance on estimating ocean shares for mixed COFOG classes. ↩ ↩²