Industry News

Transitioning to a ‘Blue Economy’

As we enter a period of uncertainty in both international and climate policy following the United States presidential election, identifying a concept that can help find the wins between the economy and the environment is even more important.

In the ocean, policymakers are asking if this may be achieved, in part, under the new concept: Blue Economy. It refers simply to sustainable economic activity derived from our global ocean, essentially, any policies and investments that simultaneously balance ecological health and economic activity in a given ocean space.

To get there, it means mapping a country’s ocean space and regulating its use based on what the ecosystem can handle, and encouraging investments in activities with environmental co-benefits, such as sustainable aquaculture systems and renewable energy.

Economic activity in the ocean is certainly growing rapidly — currently estimated at over $1.3 trillion in gross value by the Organisation for Economic Cooperation and Development, a number they expect to grow faster than the global economy over the next decade. The blue economy concept seems to suggest that this growth will be higher with policies that achieve a win-win with the environment and that don’t forget about the natural systems underpinning economic activity in the ocean.

Since the term’s emergence at Rio+20, we have seen more and more finance ministers from ocean-facing countries tasked with finding new ways to approach sustainable growth looking for advice on how to transition to a blue economy.

A new report Toward a Blue Economy: A Promise for Sustainable Growth in the Caribbean published with finance ministers in mind, attempts to explain using one region — the Caribbean — as an example.

For the first time, it roughly estimates the magnitude of the Caribbean Sea’s economic importance. Gross revenues from the economic activities linked to the part of the Caribbean Sea under the control of islands and territories are estimated at US $53 billion annually.

Those linked to the entire Caribbean Sea as some US $407 billion annually — without inclusion of activities not captured in the marketplace such as the role of reefs, mangroves and other natural habitats in protecting communities and infrastructure from flooding and storms.

The report suggests a package of blue economy policies whereby Caribbean countries would measure the value of their ocean economies to better account for the contributions received from nature, manage their ocean spaces as a whole rather than industry-by-industry, and invest in sustainable industries.  The purpose is to ensure better decision making over ocean assets, which ultimately underpin the well-being of people and the planet.

For an ocean area that covers less than two percent of our global ocean, yet generates over US $400 billion in revenues per year, it’s no wonder finance professionals within and outside the Caribbean region have started looking at the Caribbean Sea and region in a different way.

We are seeing real traction among governments in the concept of a blue economy. Grenada launched the development of a blue growth strategy in 2014 and is planning a Blue Innovation Institute to support policy-makers transition to a blue economy. This strategy includes a commitment to protect 25 percent of the ocean area near its shore while supporting small-scale fishing communities, and leveraging its brand “Pure Grenada” to increase high-value tourism.

The broader Organization of Eastern Caribbean States endorsed an integrated ocean governance strategy for the waters under their control, focused on mapping the ocean environment and resources for more integrated regulations, and supporting blue growth sectors such as sustainable aquaculture and renewable energy, with a new Caribbean Regional Oceanscape Project (CROP).

These are just early steps in a long process to boost economic growth while preserving ecosystems in the Caribbean. Now having looked at this idea in the Caribbean, and witnessed first-hand the conversations taking place right now at COP22 in Morocco, we believe that the blue economy is not just a fashionable term, but a useful concept gaining real traction that can guide policies. It’s important as we enter a period of international uncertainty on environmental policy, which promotes sustainable, ocean-based economic growth to reduce poverty and improve the ecological health not only in the Caribbean, but far beyond.

Source: John Virdin, The Hill

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