But it adds that much of the work on the economic valuation of such land in countries in Africa, Asia and Latin America has been done by the international scientific community without adequate involvement or capacity building within the studied countries.
Between ten and 20 per cent of drylands and 24 per cent of all usable land on Earth are 'degraded', with the economic value of the goods and other benefits that it provides having been reduced by human activities or natural changes, according to the report.
Estimates indicate the cost of environmental degradation to be between four to eight per cent of GDP (gross domestic product) in developing countries, and two to seven per cent of GDP in north African and west Asian countries that have a significant amount of dry land.
The estimated economic loss of degradation is US$40 billion a year, mainly due to the effect of soil erosion by water and wind on crop and forest production.
“A more accurate economic evaluation is crucial to prevent and reverse land degradation by raising the profile of the issue with policymakers.”
Richard Thomas, UN University's Institute for Water, Environment and Health
This particularly affects the rural poor: the more than 1.2 billion people who depend directly on land for sustenance and income, it says.
Yet many of the countries with significant amounts of degraded land lack the capacity to evaluate their land's economic value.
A dearth of local research capacity and empirical studies make it harder to carry out valuations and to illustrate the importance of natural assets to people in developing countries, according to the report, which was published by Economics of Land Degradation (ELD), an initiative that works to raise international awareness of this matter.
"A more accurate economic evaluation is crucial to prevent and reverse land degradation by raising the profile of the issue with policymakers," says Richard Thomas, lead author of the study and assistant director of the drylands ecosystems programme at the UN University's Institute for Water, Environment and Health, based in Canada.
"It will enable them to make better decisions on land planning, and this will especially help countries negotiate better deals over land leasing [to foreign governments and companies] and set fairer agreements."
The report also finds that most of the valuation methods it reviewed were designed in developed countries and so might not be appropriate for use in developing nations.
The ELD says it will incorporate capacity-building activities into its projects to ensure that qualified personnel are present and available in affected countries to carry out valuations.
Future projects it funds will involve research partners from universities in the United Kingdom and the United States, as well as the University of Botswana. The projects will focus on Jordan, Mali, Sudan and southern Africa, with one goal being to advance knowledge on the costs and benefits associated with sustainable land use.
To do so, researchers will identify management options, pinpoint relevant ecosystem goods and services to be valued, and make policy and investment recommendations.
To help developing countries build valuation capacity, there is a need for better dialogue between researchers, local government and local people, for improved data collection and for research results to be incorporated into valuation models and policies, Thomas says.
According to Thomas, such dialogue would put land users in a better situation to decide how best to manage their land and, if offered incentives, to invest in its long-term care, thus reversing the over-extractive techniques seen in many agricultural systems.
"This would extend the planning horizon of poor rural farmers, but this will need economic, communication, educational instruments as well as policy instruments [to achieve]," he says.
The report also suggests a new approach to the economic evaluation of land, based on its 'total economic value'.
"So far, land value has been assessed only through its price on the market, but we know this is not enough," says Thomas.
The total economic value considers both the 'use value' of land, resulting from its economically profitable use, and its 'non-use value', the economic value that is not associated with consumption, including resources that will be passed to future generations.
Thomas adds: "We need to look at many other factors such as pollution or cultural and social value that were previously considered mere externalities."
> Link to full report
See below for an EDL video about the value of soil: