The world’s six largest fisheries out of 10 are in Asia — India, China, Japan, Indonesia and the Philippines. Yet the region’s ocean ecosystem have been pushed to the brink of collapse, says an Asian Development Bank (ADB) report.
Half of all coral reefs have disappeared, fish and marine stocks are declining and the ocean is getting warmer and more acidic amid rising sea levels. Millions of people’s livelihood could be at stake, if the decline continues, says ADB.
Though the ocean economy is projected to reach $3 trillion in 2030, yet its long-term health is being undermined by activities like deep sea mining. Therefore, the bank says target for a blue economy must focus on economic, social and environmental sustainability.
A coalition involving the European Commission, World Wildlife Fund for Nature, the European Investment Bank and the Prince of Wales International Sustainability have developed 14 overarching principles for the ocean economy. ADB, which is a signatory, is preparing an Ocean Finance Framework to be launched in the third quarter of this year.
Towards this end, rigorous standards and metrics are needed for investments to benefit both ocean health and the blue economy. There are many such instruments available for green finance– Climate Bonds Initiative, European Commission Sustainable Finance Taxonomy–but these may not be sufficient guard rails for blue investments.
A holistic and strategic approach is therefore needed for a blue economy in Asia and the Pacific. Such a common framework will have six objectives -developing pipelines of bankable projects, innovating financial instruments, mobilizing public and private capital, aligning taxes and subsidies and strengthening policy, knowledge and capacity.
The innovative finance instruments could be Blue Bonds that invest in projects that meet certain criteria, results-based lending where financing and interest rates are tied to delivery of specific environment goals, ocean risk insurance such as for protection of coral reefs and payments for protection of marine ecosystem resources.