Explanation: What is the blue economy?
Covering 70% of the planet’s surface, the ocean is an amazing source of biodiversity. The vast ecosystem also enables economic growth through fishing, shipping, mining, and a fleet of other industries. But its role as an economic engine has often been in contradiction with the protection of the organisms it contains.
The ocean contributes up to $2.5 trillion to global GDP each year; if it were a country, it would be the seventh largest economy in the world. However, the extractive and polluting approach that underpins most marine economic activities degrades the ocean on which they depend. The increasing loss of species and warming waters themselves threaten economic growth. The deterioration has global consequences for food security, human health and the critical role of the ocean as a carbon sink.
To change that, many trust an idea known as the “blue economy”.
No healthy economy without a healthy ocean
There is no universally accepted definition of the blue economy. Some see it clearly as all industries related to the ocean. The World Bank describes it much more accurately as “the sustainable use of ocean resources for economic growth, improved livelihoods and jobs while maintaining the health of the ocean ecosystem”.
Jason Scorse, director of the Center for the Blue Economy at the Middlebury Institute of International Studies, believes that to force change, the blue economy must embrace the sustainability-driven definition.
“A lot of leading organizations are really trying to push the idea that this is a smaller subset of future industries that will be climate friendly and help the ocean regenerate and heal. “
The concept has its roots in environmental stewardship, which some Indigenous communities have practiced for centuries to maintain the balance of the environment in which they live and on which they depend. The idea relies on the economy as a tool to achieve this goal, considering job creation, climate change mitigation, social inclusion and biodiversity protection as objectives that can be achieved together and interdependently.
The goal is also based on clear synergies between savings and sustainability. It is calculated that while the marine economy generates around US$2.5 trillion per year, the socio-economic costs of mismanagement, caused by overfishing and pollution for example, cause its real value to be closer to 1 trillion US dollars.
On the other hand, according to the High Level Group for a Sustainable Ocean Economy – a group of 14 world leaders working for the sustainability of the marine economy – a sustainably managed ocean could generate greater economic returns, produce six times more food through better management actions and create 12 million additional jobs.
It could also contribute 21% of the emissions cuts we need to cap global warming at 1.5°C by 2050, according to the panel. This would be done by developing wind and wave energy, strengthening the protection of coastal and marine ecosystems and increasing carbon storage in the seabed, among other marine activities.
Ultimately, the blue economy concept recognizes that a healthy ocean underpins a healthy economy and therefore the two must be integrated.
“Sustainable ocean economies are about economic development,” says Mari Pangetsu, the World Bank’s managing director for development policy and partnerships, at the 2022 UN Ocean Conference.
Putting the principle into practice: what are the blue economy sectors?
For the blue economy to be a true force for good, it is important to recognize the difference between status quo maritime industries and those actively working towards sustainability, Scorse says.
A seaweed farmer collects seaweed in Bali, Indonesia (Image: Matthew Oldfield Editorial Photography / Alamy)
A local community in Mombasa, Kenya plants mangroves for coastal protection (Image: Joerg Boethling / Alamy)
For example, to be considered part of the blue economy, it is not enough for an industry to simply reduce its damage by reducing emissions or bycatch, he explains. At a minimum, it should use resources sustainably, and ideally, it should help regenerate marine habitats.
This would place oil and gas extraction outside the blue economy, while the wind and wave energy sector is part of it. Conventional shipping contributes 2.5% of global emissions, but initiatives to decarbonize it using greener fuels are trying to bring the industry closer to the blue economy.
Commercial fishing that operates without harmful economic subsidies, reduces the impact of fishing gear – for example by attaching lights to gillnets to reduce bycatch – and adopts fishing habits that allow stocks to recover – by limiting for example fishing in the spawning grounds – also moves in the right direction, says Scorse.
Sustainable shellfish and seaweed aquaculture is a promising candidate for the blue economy. Scorse says the industry can generate significant amounts of food and jobs, as seaweed farming projects in China, Indonesia and Japan have done for decades, while potentially creating coastal habitats and mitigating climate change.
Conservation, meanwhile, is also advancing in the blue economy as new revenue streams emerge from habitat protection. This is crucial because some of the traditional ocean conservation has come at the expense of incomes and livelihoods. But rooting it in blue economy principles could change that.
For example, accelerating efforts to restore mangrove and seagrass habitats and a global initiative to expand marine protected areas offer opportunities to create new jobs and support livelihoods through tourism and markets. blue carbon.
Blue carbon is the carbon stored in the ocean, and blue carbon projects seek to sell it as “credits” to buyers, such as companies that want to offset their emissions. The IPCC (Intergovernmental Panel on Climate Change) has so far only recognized mangroves, seagrasses and salt marshes as being manageable and commercial.
Scorse highlights other fledgling industries, such as cultured seafood — also known as cell-based lab-grown seafood — that could help reduce pressure on wild fish populations. Additionally, there is a movement to replace “grey infrastructure” like seawalls with living shorelines that enable new habitats and improve coastal resilience, creating new jobs at the same time. “I think it’s going to be a high-growth industry in the decades to come,” Scorse says.
The road ahead
For now, the blue economy is still small. “If the ocean economy is the pie, the blue economy is maybe 5% of that,” says Scorse.
In addition to the growth of this sector, another challenge will be to make a just transition in it: the growth of aquaculture markets should not leave traditional fishermen unemployed in the future, for example. Another obstacle is funding; many blue economy initiatives, such as habitat restoration, can require significant capital to establish before they can start generating revenue.
On these fronts, momentum is building – starting with several nations that have formally committed to the principles of a global blue economy. The world leaders who formed the High Level Panel for a Sustainable Ocean Economy in 2018 pledged to sustainably manage 100% of their national waters by 2025 and to increase economic growth, build climate resilience and to strengthen marine protection. The panel now has 17 members, with the US, UK and France having signed up in the past 12 months.
The Seychelles, the United States and the European Union have also shown ambition independently with new plans for economic activities in their waters.
The goal is that one day the economy of the sea and the blue economy will be the same thing
Jason Scorse, Director of the Center for the Blue Economy, Middlebury Institute of International Studies
Funding initiatives, such as the World Bank’s Problue multi-donor trust fund, have helped dozens of blue economy projects get off the ground. Meanwhile, Seychelles, Belize and China are relying on new mechanisms such as blue bonds to raise funds for ocean projects. Several countries have also launched “debt-for-nature swaps”, which allow the cancellation of part of the external debt in exchange for national investments in sustainable blue economy projects.
Seeing growing interest from investors, the United Nations Sustainable Blue Finance Initiative has developed principles to guide investments and mobilize reliable finance.
These are just some of the steps needed to transition to the blue economy, which will be a huge challenge. But the potential benefits to our marine ecosystems, economies and climate make it a critical goal to achieve, advocates say.
“The goal is that one day the ocean economy and the blue economy will be the same thing,” says Scorse.