World Oceans Day is celebrated annually to bring attention to conservation efforts and to inspire new ones. We need, now more than ever, innovative solutions to ensure the future health of our oceans. Regardless of where one lives, oceans affect the food we eat and the air we breathe. They are also responsible for a significant portion of jobs in the economy. The road to building greater buy-in for protecting oceans is largely through financial mechanisms and approaches. These strategies speak the language of those people and organizations who hold the resources to take action.
The following five innovative strategies can make a great contribution to the future of our oceans.
1. Debt-for-Nature Conversions Focused on Oceans
Debt-for-nature conversions are normally between creditors, debtor nations, and a third party that facilitates the conversion of debt to environmental sustainability projects. These conversions leverage support from development organizations and foundations, identify the interests of investors and governments whilst creating a tool for sustained investment in environmental conservation. Although implementation has been recent, Seychelles has seen success using this financial tool, as have several other countries. Identifying similar opportunities could be a key driver of environmental protection efforts, particularly in vulnerable countries. However, concerns still exist over how to ensure that environmental sustainability projects move forward as promised once the initial transactions are made.
2. Encouraging Local Finance
As a new area with little historical data, local financial institutions may be hesitant to invest in blue growth projects, which relate to sustainable growth in the marine and maritime sectors. Although development partners could invest, they often lack local expertise. To address these issues, KfW Development Bank, Conservation International, and Finance in Motion came together in 2014 to create the eco.business Fund. The eco.business Fund provides funding for blue projects through local financial institutions, creating trust and familiarity within financing. With time, financial institutions will better understand the risks involved in blue projects and will become more comfortable investing. In the future, development organizations could encourage blue project lending by securitizing loans for blue projects or other innovative partnerships.
3. Organizing Businesses
Local economies have the ability to leverage their influence through investment and financial decisions that support ocean health. As ecotourism and sustainable business practices grow in popularity, businesses will see more value in supporting local conservation efforts. For instance, Punta Cana, a resort based in the Dominican Republic, incorporates sustainability initiatives as a core part of its mission. Other businesses could be engaged in conservation initiatives in exchange for sustainability marketing assistance or under the umbrella of a local business organization supporting ocean health.
4. Building a Market Commodity
Much like carbon credits that are used to conserve forests, ocean health can potentially generate income for governments or be traded within the private sector. Though this has not yet been implemented, the idea is that oceans provide valuable environmental services that could be priced. Furthermore, advanced geospatial information and imagery technologies are making mapping and measuring ocean health easier. These developments in turn make it increasingly possible to value ocean health in dollar amounts, efficiently maximizing use while minimizing environmental damage.
5. Investing in Capacity in the Right Places
International NGOs and multilaterals are positioned to provide capacity building to connect the gap between available finance and bankable projects. For example, tourism (23.3%) and other services together comprise 76.7% of Grenada’s GDP. Much of the country’s tourism relies on healthy oceans: clean beaches, vibrant coral reefs, and ocean wildlife. Building capacity among Grenada’s younger generation will drive local innovation and may provide solutions that can be useful elsewhere around the world.
Conservation efforts are not limited to tree-huggers and do-gooders. Ocean health is an issue that affects all of us. The financial sector can contribute transformational innovations in this area; the interests of environmentalists, investors, and private companies can align when it comes to the oceans. It is more than just shared value, but rather shared responsibility and shared potential.
Image courtesy of Flickr. Originally published by S&S on June 7, 2018.