INVESTING IN A BLUE ECONOMY
Job creation, increased economic activities and sustainable ocean resources are some of the end goals of Fiji’s recent selection in a United Nations Joint Sustainable Development Goals (SDGs) Fund.
Despite Fiji’s grim economic outlook as the impact of increasing COVID-19 cases and deaths take its toll, the UN joint fund portfolio of $21,279,600 (USD $10,239,438) could be a lifeline for businesses and local communities.
Fiji was among four countries to receive the financing. This is out of 155 proposals from over 100 countries across the globe. Fiji’s bid was strategic.
United Nations Capital Development Fund (UNCDF) Regional Technical Specialist Finance and Innovation, Hee Sung Kim said it was all about having investment ready projects.
“The key differentiator for Fiji’s proposal was that it had investment opportunities that were the most developed. With some initial project preparation funding which the UN also provides through this Project, we will have eight businesses or projects ready for investment between 2021 and 2023.”
One is a sanitary landfill in the Western Division and the other an eco-fertilizer company.
Both projects were the work of UNCDF partner or intermediary, Matanataki.
Matanataki Pte Ltd promotes itself as Fiji-based private sector partnership of business developers, finance experts, conservationists and creatives, who support the development of green and blue businesses in Fiji and the Pacific.
Their work dates back to 2019 when Jodi Smith, Matanataki’s Business Pipeline Development Lead met the two project owners during a waste management conference.
They iterated their ideas many times over in the last two years to have landed on the project they proposed for investment.
Ms Kim also acknowledged the support from the Government, in particular the Ministry of Economy’s team on climate change and international cooperation.
“They are constantly out there speaking with other Ministries, NGOs and businesses to find workable solutions to making Fiji’s vision of “securing and sustainably managing all of Fiji’s Ocean and marine resources’.”
The leadership of the UN’s Resident Coordinator’s Office was also instrumental as it brought together the different UN agencies including:
■ United Nations Development Programme (UNDP),
■ UN Environment Programme (UNEP), and
■ United Nations Capital Development Fund (UNCDF).
The joint SDG Fund is being funded by the Global Fund for Coral Reefs.
The partnership is in collaboration with the Ministry of Economy and the Ministry of Waterways and Environment.
Ms Kim said UNDP had longstanding experience and network
when it came to developing sustainable marine ecosystems in Fiji, and would ensure the investments have a positive impact on the communities that relied on these ecosystems as well as developing legal frameworks to ensure that what we seed through this initiative had a lasting effect.
The programme expects to leverage five times that amount through co-financing from investors, partners like Blue finance and Matanataki, and the entrepreneurs themselves through equity, in-kind contributions.
UNEP focuses on the social and environmental impact measurement of these investments to ensure there is no green or blue washing of investments.
UNCDF, as the UN’s impact investment agency, will make the investments.
INVESTING IN CORAL REEFS AND BLUE ECONOMY
Fiji is home to five percent of the world’s total reef regeneration capacity.
Attorney-General and Minister for
Economy, Aiyaz Sayed-Khaiyum, warned that the worst could be still to come, as climate-driven ocean acidification threatens to wipe out the vast majority of our coral.
“Building reef resilience protects a sustainable source of food and livelihoods for the Fijian people and a vibrant hub of biodiversity for the world. We hope this innovative financing initiative offers a scalable model that can support the conservation of marine resources.”
The initiative came into play as an urgent investment that is needed to pursue active adaptation strategies to save corals, reefs from climate change and other anthropogenic threats.
It provides a catalytic funding to businesses and projects that have a positive impact on protecting Fiji’s marine ecosystem
“We want to demonstrate that there is indeed a business case in investing in these opportunities, that these businesses can generate revenue, investors can get their return on investment while having a positive impact on regenerating and protecting the marine ecosystem,” Ms Kim, UNCDF’s Finance lead said.
The Blue Economy aims to encourage stewardship towards the ocean and its resources.
“The Project is trying to address the shortage of investment-ready projects and private sector perceived risk of investing in blue natural capital and the resulting high cost of getting blue economy businesses operationalized,” she said.
ON THE GROUND BENEFITS
Investment in locally managed marine areas (LMMA) is investible.
“It’s critical to have revenue generating businesses in the area,” Ms Kim said.
“Blue Finance, another intermediary partner we are working with, is working with an NGO in the Coral Reef LMMA to pilot a number of eco-tourism services such as a nature walk, mangrove regeneration, and an interactive visitor center,”
“This has the potential to provide for new economic activities and jobs for the local community. The revenues are reinvested into conservation work, and this will help sustain the ocean resources that the local community is so dependent on for their livelihoods. There is a circular effect that is created.”
SIGNIFICANCE OF THE PROJECT
This project supports the two Sustainable Development Goals: Goal 14 - Life Below Water and Sustainable Development and Goal 17 – Partnerships for the Goals.
Ms Kim noted that SDG 14 is severely underfunded and required additional resources and innovative projects to safeguard biodiversity rich ecosystems and reef dependent communities as found in Fiji.
“But the other thing is that coral
reef ecosystems provide important cross-cutting SDG co-benefits for local communities through entry points such as coral reef tourism, food security, shoreline protection, and human health and wellbeing.”
She added that the other overarching SDG that is at heart of the initiative is Goal 17 in its blending of financial instruments.
“The UN is going into these investments first with patient, concessional capital, to then open the door for other more commercial investors to come in and invest on their terms,” Ms Kim said.
“At the end of the day it is all about sharing risks, experiences, and network amongst the partners to expand the piece of the pie for everyone. The UN is well placed to do that as a neutral broker.”
GLOBAL FUND FOR CORAL REEFS (GFCR)
GFCR and the Joint SDG Fund are the primary funders of the project.
It brings together UN organisations, Member States, philanthropy (Prince Albert II of Monaco Foundation and Paul G. Allen Family Foundation), private investors (e.g., BNP Paribas, Althelia), nonprofit organizations (Blue Finance, WWF), and oceans-focused networks.”