Conserving and sustainably using the ocean has gained international momentum. In 2015, global leaders agreed on Sustainable Development Goal (SDG) 14 that specifically targets the ocean, calling for “conservation and sustainable use the oceans, seas and marine resources for sustainable development” (UN, 2015[1]). The G7 as well as bilateral and multilateral initiatives identify ocean action as a key priority.

A healthy ocean is central to human health, well-being and economic activity through the many and invaluable functions and ecosystem services it provides. More than 3 billion people rely on the ocean for their livelihoods worldwide, and an expected global population of 9 billion by 2050 will increase pressure to produce more food, energy and jobs from the ocean. Yet the cumulative impacts of anthropogenic pressures are already pushing the ocean to unprecedented conditions of further warming and acidification, decline in oxygen, and species decline (IPCC, 2019[2]; IPBES, 2019[3]). Pressures are also threatening the ability of marine ecosystems to provide invaluable benefits such as pollution control, storm protection, habitat for species, shoreline stabilisation and flood control. Once-in-a-century extreme sea level events are expected to become once-a-year events in many regions by the middle of this century. These effects are the face of a global ocean crisis that is jeopardising not only the future socio-economic benefits that society derives from the ocean but all life on this planet.

No one knows for how much longer the ocean can continue, under business-as-usual scenarios, to perform its critical functions and provide ecosystem services. The impacts of human activities are long-lasting and, in some cases, irreversible, and further delays in action will result in increasing costs over time. Achieving the conservation and sustainable use of the ocean, seas and marine resources is therefore a matter of urgency. While the level of risk varies across countries, it is likely that all countries, developed and developing, face some level of risk if current trends are not reversed. Urgent actions, therefore, are required of all countries and at multiple levels – local, national, regional and international and from individual citizens – to steer the global ocean economy towards sustainably. If conserved and sustainably used, the ocean can regenerate, be more productive and resilient, and support more equitable societies.

A global transition towards sustainable ocean economies could greatly benefit developing countries, many of which already rely heavily on ocean-based industries and are thus particularly vulnerable to the deterioration of marine habitats and ecosystems on which these industries depend. Sustainable ocean economies should be pursued with a view to achieving poverty reduction, enhancing food security, and achieving decent jobs, clean energy, and healthy and resilient ecosystems and to combat climate change.

This report provides original and comprehensive evidence to support developing countries, and the international development community, to harness the benefits of sustainable ocean economies. The new evidence in the report focuses on:

  • significant trends in the ocean economy in developing countries, with an original breakdown by countries’ income groupings for six ocean-based industries. Trends in sectors of particular interest to developing countries are also assessed, and include marine fishing and aquaculture, coastal and marine tourism, extractive industries (e.g. oil and gas and seabed mining), transport and logistics industries (freight and passenger transport), shipbuilding, renewable energy, and bio-marine resources.

  • the need for coherent frameworks and the policy instruments to promote the conservation and sustainable use of the ocean, covering a range of regulatory and economic instruments and other approaches. Emphasis is placed on economic instruments that can provide the correct incentives for sustainable production and consumption and also generate and mobilise finance for the conservation and sustainable use of the ocean.

  • the first estimation of Official Development Assistance (ODA) and a mapping and analysis of development co-operation activities for sustainable ocean economies, to promote more effective development co-operation in support of developing countries’ transition to sustainable ocean economies and a global ocean economy that benefits developing countries.

  • an analysis of how development co-operation is helping mobilise private finance for sustainable ocean economies through grants, guarantees, and other leveraging instruments, and a review of innovative financial instruments, developed with the support of development co-operation, to scale up finance for the ocean. Emphasis is placed on the need for development co-operation to help re-orient financial flows away from destructive practices by supporting the integration of sustainability requirements into traditional financial services and investments, in financial markets (e.g. stocks and bonds), alongside credit markets (e.g. loans or bonds).

The report integrates findings from the Sustainable Ocean Economy Country Diagnostics conducted for this work in Antigua and Barbuda, Cabo Verde, Indonesia, and Kenya. In the course of each of these country diagnostics, additional information was collected, including through interviews with more than 50 representatives from national administrations, the private sector, academia and civil society. The economics trends highlighted in Chapter 2 are based on original OECD long-term experimental time series of value added and employment that were developed for a subset of the ocean economy by the STI Ocean Economy Group and overseen by the OECD Committee for Science and Technological Policy. This subset includes, for now, six ocean-based industries: marine fishing, marine aquaculture, marine fish processing, shipbuilding, maritime passenger transport and maritime freight transport. Many of these industries have strong relevance for developing countries. Chapter 3 builds on unique data available in the OECD Policy Instruments for the Environment (PINE) database that the OECD Environmental Policy Committee oversees and to which more than 110 countries are contributing. Chapters 4 and 5 build on the first quantification and analysis of ocean-related ODA, developed for this report on the basis of the OECD Creditor Reporting System. These two chapters also build on the findings from the OECD Survey on DAC Members’ Policies and Practices in Support of the Sustainable Ocean Economy (hereinafter the OECD Survey).

While the ocean is central to the welfare and prosperity of the whole of humankind, on average developing countries rely on the ocean for jobs and their GDP to a greater extent than do richer countries. OECD countries capture most of the global value added from the ocean economy. In 2015, this amounted to approximately USD 200 billion for a subset of the ocean economy composed of six main ocean-based industries (marine fishing, marine aquaculture, marine fish processing, shipbuilding, maritime passenger transport and freight transport). However, these six industries contribute to a much larger share of developing countries’ gross domestic product (GDP): more than 11% of GDP for lower middle-income countries and 6% for low-income countries, compared to less than 2% of GDP for high-income countries in 2015. In some low-income countries and SIDS, other important ocean-based sectors, such as tourism, can account for more than 20% of GDP, compared to 2% for OECD countries.

Across developing countries, the potential benefits and risks from a growing global ocean economy vary largely. Value added of the ocean economy increased the most in the East Asia and Pacific region, growing from USD 157 billion in 2010 to over USD 175 billion in 2015 and largely driven by the People’s Republic of China (hereafter China). The sectoral composition of the ocean economy also differs across countries, with marine fisheries particularly dominant in low-income and lower middle-income countries where this sector represents up to 6% and 8%, respectively, of GDP. Beyond the six selected industries, two additional ocean-based industries – tourism and offshore oil and gas – are crucial for low-income countries and small island developing states (SIDS). Two out of three SIDS rely on tourism for 20% or more of GDP. The total contribution of tourism to GDP exceeds 40% in Antigua and Barbuda, Belize, Maldives, Saint Lucia, and Fiji and more than 50% of GDP in Cabo Verde and approximately 65% of GDP in the Seychelles. Offshore oil production and its supporting activities are also crucial for many African, Latin American and South Asian countries. In Angola, it contributes about 50% of the country’s GDP and about 89% of exports. Looking forward, some emerging ocean-based sectors, such as deep seabed mining, could have potentially huge environmental impacts. Developing countries must be in a position to assess and balance the risks and rewards associated with developing these industries to achieve a sustainable use of resources that effectively integrates community interests and environmental concerns from the outset.

The strong reliance of some developing countries on the ocean makes them particularly vulnerable to growing anthropogenic pressures on the ocean and increases the need to pursue sustainable development models. Many developing countries are home to vast untapped reserves of ocean-based minerals, natural gas and seafood as well as to marine biodiversity hotspots. Shifting towards more sustainable use and conservation of ocean resources is essential, not only to ensure ocean health globally, but also to allow developing countries to fully benefit from the opportunities of the ocean economy. Conversely, using ocean resources through the prevailing harmful and unsustainable practices would lead to high socio-economic and environmental costs for developing countries and the world’s ocean. If developing countries are to be able to harness the benefits of the sustainable ocean economy, economic activities (such as ocean-based industries, artisanal activities and other land-based industries that impact the ocean) must be steered towards sustainability through adequate policies and regulations at national, regional and international levels.

Developing countries can use a range of policy instruments (regulatory, economic, and information and voluntary approaches) to harness the benefits of sustainable ocean economies. Robust and coherent policy frameworks are key to ensuring the conservation and sustainable use of the ocean. Sectors in the ocean economy are highly interconnected, and actions taken in one sector have impacts on others. If policy making across the ocean economy deals with sectors in isolation and without a coherent conceptual frame, multiple and sometimes conflicting policy goals can emerge. Such fragmented policy making will not be sufficient to implement the urgent and systemic changes required to steer the ocean economy towards greater sustainability. Therefore, more holistic and integrated policy approaches are needed to ensure policy coherence, identify and manage trade-offs between the sectors, and take advantage of synergies where policies can deliver benefits to multiple sectors.

Promoting the ocean economy sustainably requires not only well-designed policies but also adequate finance to ensure these are effectively managed, monitored and enforced. Policies to address the multiple anthropogenic pressures on the oceans include instruments that are cross-cutting, such as marine spatial planning and environmental impact assessments, and that are sector-specific, such as taxes on plastic waste and marine pollution, ecosystem-based fisheries management systems, fees and charges on the use of marine resources, incentives for sustainable tourism, and payment schemes including blue carbon payments for ecosystem services. Economic instruments in ocean-based industries can also generate government revenue that can be channelled towards conservation and sustainable use of the ocean. Globally, more and more countries have introduced economic instruments targeted at ocean sustainability. By 2020, 57 countries had introduced ocean-related instruments, more than three times as many as in 1980, according to data reported to the OECD PINE database (Figure 1). In 2018, at least USD 4 billion was raised through ocean sustainability-related taxes, including on fisheries, maritime transportation and marine pollution.

Scientific and technological advances can contribute greatly to mapping and better understanding ocean resources and thus to developing effective policy frameworks and managing these resources more effectively. Scientific and technological advances are contributing to an integrated and evidence-based management of the ocean and fostering solutions to improve the sustainability of ocean-based economic activities (OECD, 2019[5]). For developing countries, such advances can contribute greatly to building national ocean strategies by enhancing understanding of national marine resources and enabling more effective monitoring of the activities taking place in national waters and beyond.

Developing countries can tap into these advances for the development of sustainable ocean strategies with support from donor countries and marine research institutes around the world. Ongoing scientific exploration campaigns (mapping the seafloor and flora and fauna) are already contributing to improved understanding of the national marine resources of Cabo Verde, Gabon and the Seychelles, for example. Marine technology transfers are also helping countries more effectively monitor the activities taking place in their national waters and beyond, for instance by tracking fishing vessels and shipping. An important first step to assess fragile ecosystems may be linking with existing knowledge and innovation networks, to form partnerships where mutual learning is key, and base any future activities on scientific evidence.

Development co-operation has a unique role to play to ensure that developing countries have access to the knowledge, science, innovations and finance needed to achieve sustainable ocean economies and that the global ocean economy is guided by institutional arrangements and policies aligned to sustainability and benefitting the world’s poor and most vulnerable. The development community is increasingly engaged on ocean issues and many bilateral and multilateral initiatives have emerged in the past three years. However, there is a need to develop common definitions, standards and principles to monitor the progress of the development co-operation community in supporting sustainable ocean economies and to promote mutual learning and the adoption of good practices for more effective development co-operation in this area. This is necessary also because while some development co-operation providers have a track record of support for fisheries or other ocean-based sectors, the sustainable ocean economy concept is fairly new, and few providers understand the ocean economy holistically and have dedicated strategies and management tools.

The volume of ODA for the ocean economy is rising, outpacing in 2013-18 the growth rate of global ODA, but it is still small – USD 3 billion on average a year in 2013-18 – and only about half of it promotes sustainability (i.e. ODA for the sustainable ocean economy) (Figure 2). ODA for the sustainable ocean economy is concentrated on three sectors - maritime transport, fisheries and marine protection – rather than supporting a wider range of existing and emerging ocean-based sectors to foster economic diversification and resilience. The report focuses on six areas/sectors of the sustainable ocean economy (i.e. ocean conservation, sustainable fisheries, sustainable tourism, renewable marine energy, and curbing ocean pollution) to illustrate the range of sustainable ODA projects in each of these areas and contribute to a common understanding of what contributes to sustainability with regards to the ocean economy. These sustainable ODA projects, which include new technologies for sea surveillance and security; value addition of fish products through sustainability certifications, support to reduce greenhouse gas emissions from ships and port infrastructure, etc. – also offer insights into replicable and scalable approaches.

Development co-operation is leveraging private finance and supporting the development of innovative financial instruments that mobilise capital for the sustainable ocean economy. Through the catalytic use of ODA grants, guarantees and other financial instruments, development partners leveraged a total of USD 2.96 billion of private finance in support of the ocean economy in 2013-17, equivalent to an annual average of USD 593 million. This includes private finance mobilised for ocean-based industries and ecosystems (USD 1.26 billion, or 43%) as well as private finance mobilised for land-based activities that reduce negative impacts on the ocean such as waste management, sanitation and water treatment (USD 1.66 billion, or 57%). (Figure 3 left panel).They also contributed to develop new financing instruments – such as blue bonds, debt-for-nature swaps and new insurance schemes for the ocean Figure 3, right panel)– by providing technical assistance, absorbing the development phase costs of new instruments, using concessional finance to achieve credit enhancement, and supporting the identification of a pipeline of bankable projects. However, greater efforts are need to re-orient financial flows that perpetuate destructive practices that often negatively impact developing countries’ fish populations, coasts, tourism, food security and livelihoods. Development partners have a critical role to play to support policies, regulations and financial levers to divert finance from such harmful and unsustainable practices and to integrate sustainability requirements in traditional financial services and investments, financial markets (e.g. stocks and bonds), and credit markets (e.g. loans or bonds).

The COVID-19 crisis is severely affecting key ocean-based sectors and casting growing uncertainties on the global ocean economy, but it needs to be turned into an opportunity to rebuild ocean industries more sustainably through co-ordinated efforts and adequate international support. The impacts of the COVID-19 pandemic could have long-lasting effects on ocean-based industries. The acute disruptions to tourism, marine transport and other ocean-based sectors have significant economic ramifications for many developing countries, including some of the most vulnerable countries such as small island developing states (SIDS). While the pandemic is casting a pall of uncertainty over the global ocean economy, it will be important for countries to not lose sight of the longer-term opportunities that a sustainable ocean economy can offer and to consider how to best integrate sustainability into stimulus packages and recovery efforts in national goals and objectives, with support from the international community.

To achieve sustainable ocean economies that benefit all, actions are required of all countries and stakeholders. The following are recommendations adressed to developing couries and development co-operation providers for developing countries to harness the benefits of the sustainable ocean economy.

  1. 1. Identify and monitor key pressures on the ocean under national jurisdiction, where they originate (local, regional, international) and from which sectors:

  • Identify key pressures on the ocean and the sectors and activities they stem from. When possible, consider both current as well as projected pressures under business-as-usual scenarios.

  • Monitor the state of the ocean including fish stocks and other resources and the condition of coral reef and other marine habitats. Where possible, assess the potential economic opportunities within existing and emerging sectors.

  1. 2. Promote policy coherence via effective national institutional arrangements, including inter-ministerial or inter-agency co-operation and co-ordination, and promote an integrated approach to management of land, coastal and sea areas:

  • Review and evaluate existing institutions as well as any mechanisms in place to foster national policy coherence, with the aim of aligning the economic, social and environmental objectives.

  1. 3. Evaluate the adequacy of existing policy instruments to address the pressures on the ocean, identify policy gaps and estimate the financing needs to put in place effective policy mixes:

  • Examine and evaluate the policy instruments that are already in place and identify the policy gaps and opportunities to scale up existing policy instruments. The suite of policy instruments ranges from regulatory instruments to economic, information and other instruments. Economic instruments include fiscal measures such as taxes and subsidies, as well as instruments such as payments for ecosystem services and user fees (e.g. entrance fees for marine protected areas).

  1. 4. Identify the level of finance needed to scale up existing measures and put in place new measures:

  • Evaluate the role that fiscal and other economic instruments, other finance mechanisms and development finance can play to help to close the finance gap.

  1. 5. Develop national strategies and plans to ensure the conservation and sustainable use of the ocean, including elements to mobilise finance and to monitor progress over time:

  • Develop national strategies and plans that set a long-term vision for the sustainable ocean economy and recognise the complexity of intersectoral interactions, integrate environmental, social and economic values, and include adequate resources across sectors. In these strategies and plans, establish clear targets, timetables and indicators to monitor progress.

  • Track finance generated through fiscal and other economic instruments and through other finance mechanisms. Track their impacts to promote a common understanding of how these instruments and mechanisms can support a sustainable ocean economy.

  • Monitor the implementation of policies and their efficacy over time.

  1. 6. Seize the opportunities offered by scientific and technological advances to foster a sustainable ocean economy.

  • Endeavour to get involved with ocean knowledge and innovation networks that are developing around the world, and join international co-operation initiatives to benefit from knowledge transfers and collaboration in capacity building more generally. This calls also for support from developed countries to encourage and facilitate the engagement of low-income countries in such networks and projects. As an example, the Commonwealth Blue Charter promotes ocean exploration and marine mapping projects in interested coastal countries and small island developing states that are conducted in partnerships with United Kingdom oceanographic institutions. On a global basis, the United Nations Decade of Ocean Science for Sustainable Development, to be launched in early 2021, will provide an important opportunity to engage in new research and capacity building programmes.

  1. 1. Develop coherent, evidence-based approaches and tools to support developing countries to manage the risks and opportunities of the ocean economy and transition to sustainable ocean economies:

  • Support developing countries develop a coherent, unified policy strategy that sets out a vision and direction for the sustainable ocean economy and in which the complexity of intersectoral interactions is understood; environmental, social and economic values are integrated; and adequate resources are mobilised across sectors.

  • In existing sectors, development co-operation could focus support on correcting the trends of financial leakages, economic exclusion, and environmental degradation in existing ocean-based sectors. In emerging sectors, providers can support countries to develop capacities to assess and balance risks and rewards of new ocean-based sectors so as to achieve a sustainable use of resources that effectively integrates community interests and environmental concerns from the outset.

  • Track ODA for the sustainable ocean economy and its impacts based on a common definition and clear principles. The tracking of ocean-relevant ODA should become an integral part of the regular monitoring of ODA flows to provide transparency and accountability of these flows and promote mutual learning on the most effective ODA interventions and approaches for supporting sustainable ocean economies. An official taxonomy of ODA for the sustainable ocean economy could be developed to guide the tracking and monitoring of ODA flows. Ideally such taxonomy would also include gender inclusion and social sustainability criteria.

  • Explore new development co-operation schemes fit for transitioning to sustainable ocean economies, for example new co-operation schemes that take into account the global public good nature of ocean resources and development co-operation schemes to strengthen developing countries’ expertise and negotiating skills in relation to new market opportunities.

  1. 2. Help align private finance to the sustainability imperative of ocean economies, supporting the scaling up of sustainable investments and helping to redirect private finance away from harmful practices and towards sustainable activities:

  • Use ODA catalytically to improve the commercial viability of investments in sustainable activities and businesses, helping to create new sustainable products and markets including through new investment vehicles and instruments.

  • Integrate ocean sustainability requirements in all ODA lending and all development finance institution (DFIs) lending (not all of which is concessional in ODA terms).

  • Support the adoption of the Sustainable Blue Economy Finance Principles and the integration of ocean sustainability requirements by international finance institutions (IFIs), which bilateral development partners can influence as they are members and shareholders of these institutions.

  • Advocate for the adoption of the integration of ocean sustainability requirements by exchange listing and other financial market regulations for refocusing investments to ocean-based industries towards sustainability and explore additional financial and policy levers.

  • Strengthen independent assessments of the impacts of financial flows to the ocean economy such as through international and research institutions.

  1. 3. Promote international policy coherence for a sustainable global ocean economy:

  • Support independent studies on how the sustainable ocean economies of developing countries are affected by OECD countries’ policies beyond development co-operation, such as fisheries, tourism, investment and finance policies, as well as by transboundary policies and impacts, such as transboundary pollution.

  • Promote evidence-based dialogue across countries on the impact of policies beyond development co-operation on the sustainability of developing countries’ ocean economies.

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