Goal 14: Life Below Water

 

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The world ocean contributes substantially to human development, including to the provision of food security, transport, energy supply, tourism and many of the planet’s most critical ecosystem services (such as carbon and nutrient cycling, climate regulation, and oxygen production). The ocean contributes around US$3 trillion per year to the global market economy, or about 5 percent of GDP. Estimates of the value of ocean non-market services run at about 63 percent of all such services provided by the planet’s ecosystems.

Fisheries and aquaculture contribute US$100 billion per year and about 260 million jobs to the global economy. Women comprise 47 percent of the total workforce dependent on commercial capture fisheries for their livelihoods, including the post-harvest sector. International shipping moves over 90 percent of international trade. Thirty percent of global oil extraction occurs in offshore waters, valued at approximately US$900 billion per year and increasing. Tourism represents 10 percent of global GDP and about 10 percent of global jobs; with coastal tourism being a major component.

The integrity of ocean values and services is at significant risk due to a range of ocean management policy and market failures leading to overexploitation of fisheries, pollution, introduction of invasive species, habitat loss and ocean acidification. Ninety percent of global fish stocks are fully exploited or overexploited. Nutrient loads to the oceans have tripled since preindustrial times, leading to a geometric increase in coastal hypoxic areas, now numbering over 500. The rapid growth of the shipping industry has led to an explosion of introduced aquatic species carried via ship ballast water and hulls. Twenty percent of the world’s coral reefs have already been lost and another 20 percent degraded. Mangroves have been reduced to over 30 percent of their historical cover and 29 percent of seagrass habitats have disappeared since the late 1800s. Of the 300 million tons per year of global plastics production, an estimated 10 million to 20 million tons is entering the oceans and damaging species and ecosystems. Lastly, due to human CO2 emissions, the oceans are acidifying rapidly, perhaps faster than ever before, with ocean acidity increasing by 30 percent over the last 50 years and already starting to impair the functioning and integrity of ocean ecosystems.

Each year, overfishing and unsustainable practices generate economic losses valued at about US$83 billion, coastal hypoxia casues losses of US$200 billion to US$800 billion, damage from invasive aquatic species is valued at US$100 billion and damage from ocean plastics is valued at US$13 billion. In the "business as usual" climate change response scenario, ocean acidification will cost US$1.2 trillion per year by 2100 as ocean acidity increases an additional 250 percent.

Financing Life Below Water

Actions to achieve SDG target 14.5-10 percent of oceans under protection-are alone estimated to require at least a US$28 billion one-time public investment and about $21 billion a year thereafter. The costs to avert continued ocean acidification, which is directly linked to cogent action on climate change mitigation under the Paris Agreement, most certainly run into the trillions. While reforming the annual US$16 billion in harmful fisheries subsidies could be construed as a cost, it could also be converted to a benefit if these public funds were instead invested in improved fisheries management, sustainable aquaculture and marine protected areas. 

Beyond domestic public finance, “blue” financing has thus far been provided by international Official Development Assistance, including through grants and loans from development banks and bilateral and multilateral donors. Other successful solutions have emerged: for example, tradeable fisheries rights were effective, through the Parties to the Nauru Agreement PNA Vessel Day Scheme at mobilizing large scale funding in relation to tuna conservation in the Pacific. Governments, especially those in tourist destinations, are generating increasing revenues from payments for ecosystem services to fund and protect marine conservation projects. Conservation trust funds such as the Caribbean Biodiversity Fund are attracting new investment sources and are used to support activities implemented by local communities.

Other promising funding mechanisms such as blue bonds and the re-emergence of debt-for-nature swaps may soon offer new opportunities. Impact investment in the fisheries sector will bring expertise and capital to promote a shift to sustainable practices.

Financing Solutions for SDG 14

The solutions listed below provide a wide range of options to significantly increase resources that can help sustain our marine and costal legacy. These reviews do not however constitute an exhaustive or comprehensive list of financing solutions for SDG 14. For a more comprehensive set of solutions, please visit the BIOFIN catalogue.

Biodiversity offsets

Measurable conservation outcomes resulting from actions that compensate for significant residual adverse biodiversity impacts arising from development projects.

Bioprospecting

Systematic search for biochemical and genetic information in nature in order to develop commercially-valuable products and applications.

Concessions (Protected Areas)

Concessions allow people to use land or property in a protected area or natural site for a specified purpose, usually in exchange for a fee.

Crowdfunding

Approach for projects, organizations, entrepreneurs, and startups to raise money for their causes from multiple individual donors or investors.

Debt for nature swaps

Agreement that reduces a developing country’s debt stock or service in exchange for a commitment to protect nature.

Disaster risk insurance

Insurance schemes covering—against a premium—the costs incurred by the insured entity from extreme weather and natural disasters.

Ecological fiscal transfers

Integrating ecological services means making conservation indices (e.g. size of protected areas) part of the fiscal allocation formula to reward investments in conservation.

Enterprise challenge funds

Funding instrument that distributes grants (or concessional finance) to profit-seeking projects on a competitive basis.

Entrance and activity fees

Tourists pay fees for access to a protected area. The revenues can contribute to conservation through retention by protected areas, revenue sharing agreements, and public transfers.

Environmental trust funds

Legal entity and investment vehicle to help mobilizing, blending, and overseeing the collection and allocation of financial resources for environmental purposes.

Green bonds

Bonds where proceeds are invested exclusively in projects that generate climate or other environmental benefits.

Impact investment

Investments made with the intention to generate a measurable social and environmental impact alongside a financial return.

Lotteries

Governments and civil society use lotteries to raise funds for benevolent purposes such as education, health, and nature conservation.

Payments for ecosystem services

Payments for ecosystem services (PES) occur when a beneficiary or user of an ecosystem service makes a direct or indirect payment to the provider of that service.

Public guarantees

Guarantees can mobilize and leverage commercial financing by mitigating and/or protecting risks, notably commercial default or political risks.

Remittances (Diaspora Financing)

Private unrequited transfers sent from abroad to families and communities in a worker's country of origin.

Social and development impact bonds (Results-Based Financing)

A public-private partnership that allows private (impact) investors to upfront capital for public projects that deliver social and environmental outcomes in exchange for a financial interest.

Taxes on pesticides and chemical fertilizers

Taxes on certain pesticides and chemical fertilizers can mobilize fiscal revenues while mitigating the negative effects associated with pesticide/fertilizers application and promoting sustainable agriculture practices.

Taxes on renewable natural capital (water; timber)

Any fee, charge or tax charged on the extraction and/or use of renewable natural capital (e.g. timber or water).

Voluntary standards (finance)

Standards applicable to the financial sector that capture good practices and encourage the achievement and monitoring of social and environmental outcomes.