Financing Resilience for Ocean Economies

On Thursday, April 9, Perry World House convened a workshop titled “Financing Resilience for Ocean Economies.” It brought together policymakers, practitioners, and academics with participants hearing a range of perspectives from Australia, Barbados, Costa Rica, India, Maldives, Palau, and Seychelles, as well as the International Monetary Fund, InterAmerican Development Bank, United Nations University, United Nations Environment Programme, and the Alliance of Small Island States, among many others.

On Thursday, April 9, Perry World House convened a workshop titled “Financing Resilience for Ocean Economies.” It brought together policymakers, practitioners, and academics with participants hearing a range of perspectives from Australia, Barbados, Costa Rica, India, Maldives, Palau, and Seychelles, as well as the International Monetary Fund, InterAmerican Development Bank, United Nations University, United Nations Environment Programme, and the Alliance of Small Island States, among many others.

Together experts discussed how to close the urgent $175 billion annual investment gap in ocean resilience. While the blue economy is projected to reach $3 trillion annually by 2030, participants recognized that this growth remains deeply uneven, leaving Small Island Developing States (SIDS) and other coastal communities—whose livelihoods depend on marine tourism, fishing, and offshore energy—without the finance they need to build resilience and safeguard their development.

The workshop unpacked the elements and framing needed to create a more coherent, and appropriately scaled oceans financing architecture that could withstand shocks, learn from terrestrial examples, and underwrite development. Oceans represent a unique challenge for financing because they straddle the line between public and private goods. This makes it difficult to apply standard terrestrial models but also creates opportunities. Considerations included:

• Establishing a Revenues, Savings, and Costs Framework organizing a finance narrative around revenues (mitigation), savings (adaptation that avoids future costs) and grants (reserved for costs incurred due to losses and damages). To make this framework bankable, the system would verify, register, and grade impact, particularly for adaptation, to create a “resilience dividend” that could be turned into a recognized asset class for investors.
• Reforming Global Credit Rating Agency Standards (e.g. African Credit Rating Agency – AfCRA) moving away from ratings based on biased per-capita income and “developing country premiums.” Instead, it would rely on projected growth and the “resilience dividend,” which would improve access to international capital and encourage the provision of patient capital.
• Implementing ‘Missing Middle’ Financing utilizing models like patient capital, donor guarantees, and grants to support countries too rich to access finance from the International Development Association (IDA) but too small or risky for market-rate private financing (e.g. the International Finance Facility for Education – IFFEd).
• Developing “Airport Equivalents” for the Ocean investing in the human capital, research capacity, and infrastructure (like fish processing zones) necessary to unlock economic potential beyond just fisheries.
• Scaling Debt Swaps and Parametric Insurance using AAA-rated institutions to back market-based swaps that reduce interest rates, and utilizing parametric insurance to protect against GDP losses from disasters.
• Utilizing Clean Energy Aggregation Vehicles by pooling demand for technologies regionally, like solar, to allow small states to access the same pricing and contract terms as large states.
• Exploring Cost-Recovery Models and Levies by considering registration fees for technologies or services (like undersea cables) and industry-negotiated levies to create predictable revenue streams.
• Integrating Oceans into Multilateral Agendas ensuring institutions like the United Nations Framework Convention on Climate Change, Global Environment Facility, and Global Climate Fund recognize oceans as a major asset that needs to be included across all agenda items.

The policy ideas and research proposals that emerged from the convening will inform the UNFCCC process, including proceedings at COP31, co-hosted by Türkiye and Australia in partnership with Pacific Small Island Developing States, as well as the pre-COP gathering to be held in Fiji.