By Marisa DREW
Despite carrying 80% of global commerce , absorbing 30% of its CO2 emissions , and providing food security for nearly three billion individuals Globally, the blue economy (which encompasses oceans and waterways) faces severe underinvestment issues, particularly evident in Africa.
Amid increased economic instability and stricter financial limitations, shifting towards a more sustainable blue economy presents a significant, mostly overlooked chance for the region.
This goes beyond mere theory. Considering investors' strong interest in sustainable and scalable profits, the chance is right before our eyes, and governmental bodies are beginning to recognize this. This concept covers more than 30,000 kilometers (18,640 miles) of coastline, Africa's maritime economy holds vast potential. $300 billion valued at billions of dollars annually, and it is well-placed to thrive due to the wider transition towards more environmentally friendly practices.
The African Union projects The blue economy is projected to grow to $405 billion by 2030, potentially reaching up to $576 billion by 2063. With this expansion, job numbers may rise from 49 million positions in 2019 to around 78 million by 2063.
Emphasizing the areas with the greatest potential aids in contextualizing these figures. Take the food sector, for instance; advancing eco-friendly fish farming and fishing methods might assist in addressing the rising requirement for proteins across Africa and other regions.
Our analysis indicates that sustainable fish production through aquaculture in Africa has the potential to increase eightfold, potentially reaching about 19 million tonnes annually by 2050.
The energy sector also holds significant promise. Research from the World Bank indicates that South Africa has the potential to achieve 900 gigawatts Of offshore wind capacity, and this is not exclusive. Altogether, offshore wind could increase Africa’s electricity generation 45 times over.
The sustainable blue economy also plays a crucial role in climate adaptation. Sea levels along large parts of Africa’s coastlines are rising. increasing at a rate higher than the global average , marine restoration and conservation efforts can enhance natural resilience simultaneously providing advantages to food systems, biodiversity, along with other areas like tourism.
However, to ensure the blue economy remains genuinely sustainable, Africa and the Middle East require roughly $70 billion per year in investments From now until 2030, to achieve this objective, governments ought to utilize cutting-edge financial tools to attract additional investment towards the blue economy and promote sustainable, expandable initiatives.
Luckily, the need for these solutions is increasing, and throughout 80% of African countries have already incorporated the blue economy into their national development plans or climate strategies.
Leaders from various sectors are starting to view the ocean as a critical resource that must be safeguarded and responsibly maintained. Although financial tools such as blue debt instruments show significant promise, numerous organizations haven’t fully taken advantage of the opportunities within the sustainable finance sector. Increased adoption of blue bonds, sustainability-linked loans, and social impact bonds has the potential to direct funds precisely where they’re required most.
Likewise, debt conversions aimed at protecting nature—commonly known as "debt-for-nature swaps," where funding or debt forgiveness is specifically designated for eco-friendly initiatives—are appealing choices for countries issuing bonds, contingent upon their fiscal traits. These deals can lessen interest payments and make more funds available to help achieve a nation’s environmental objectives.
For instance, last year, Standard Chartered (where I serve as the Chief Sustainability Officer) joined forces with the Government of The Bahamas, The Nature Conservancy, and the Inter-American Development Bank (IDB) to initiate a project. creative debt restructuring for nature and climate The project anticipates generating $124 million for marine conservation, showing that this investment category is advancing rapidly — and holds substantial promise for expansion.
Furthermore, initiatives aimed at fostering sustainable blue economy approaches and methodologies are gaining backing from regulatory changes, marine spatial planning schemes, and collaborative frameworks such as those promoted by the International Union for Conservation of Nature. Great Blue Wall Initiative These efforts are establishing the groundwork for an influx of investment opportunities backed by tangible assets, local control, and quantifiable outcomes.
The momentum will continue to grow this year. In June, the Blue Economy and Financial Forum and the UN Ocean Conference provide chances for global investors to fund viable projects and speed up the expansion of Africa's sustainable blue economy. These challenges, which include regulatory hurdles and inadequate capability to create projects, can be addressed through appropriate collaborations.
Sustainability of Africa's blue economy is no longer just a theoretical concept. Our recent study reveals, Harnessing Africa’s Blue Economy This indicates that it is an expanding investment opportunity — a sector that financial institutions, asset management companies, and governmental bodies must not overlook.
Marisa Drew serves as the Chief Sustainability Officer at Standard Chartered.
Provided by Syndigate Media Inc. ( Syndigate.info ).
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