Millions To Be Invested In Blue Economy Projects In “Big Ocean States” – CleanTechnica

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Much of the news we publish has to do with mainland activities, so perhaps we could add more about what is happening on islands and areas near water. Well over 700 million people live on islands and over 2 billion live in coastal areas. 

Climate change impacts are very visible in these places: sea level rise, flooding, storm intensity, storm destruction, ecological and economic disruption, and ocean acidification, to reference a partial list. Climate change is already displacing millions of people and it is predicted there will be far more.

Outrigger Impact recently announced it is investing in island economies. Simon Dent, Co-Founder and Managing Director at Outrigger Impact, answered some questions about the investing for CleanTechnica.

What is Outrigger Impact and how much is it investing?

Outrigger Impact is a new fund designed to deploy catalytic capital into the regenerative and sustainable blue economy in Small Island Developing States (SIDS).

Our Outrigger Technical Assistance Facility (OTAF) will begin investing more than $5 million in investment-readiness grants and repayable loans to help promising island-based enterprises and projects reach “bankability” thanks to a commitment from the UK Government’s Blue Planet Fund, Global Environment Facility and other donors.

The long-term ambition for the accompanying Outrigger Impact Fund is to target investments of up to $100 million to scale those ventures and other sustainable business models, developing more sustainable and resilient economies and communities, and conserving and enhancing biodiversity and ecosystems

What are catalytic capital and the blue economy?

Catalytic capital is patient, risk-tolerant finance that lowers risk for additional investors and so encourages mobilization of additional capital from more traditional investors. By absorbing first-loss risk or offering concessional terms, it unlocks deals that would otherwise stall — exactly what SIDS entrepreneurs often need.

The sustainable blue economy refers to the sustainable use of ocean resources to drive economic growth, improve livelihoods and jobs, and preserve the health of marine and coastal ecosystems. In practice it includes sectors such as ocean conservation, sustainable seafood, low-carbon shipping and renewable ocean energy.

Why is it important to invest in island economies?

SIDS are, in essence, “Big Ocean States.” Their Exclusive Economic Zones cover about 30% of the world’s ocean, yet their domestic markets are small and capital-scarce.

Island economies depend heavily on ocean-based sectors, with tourism alone exceeding 40% of GDP in several Caribbean and Pacific islands, and fisheries reaching 30% or more of GDP. As such, climate shocks hit them first and hardest; a single cyclone can easily wipe out a year’s GDP (or more).

Investing early builds climate resilience, protects globally significant biodiversity hot spots like coral reefs, and supports the communities that steward vast stretches of the ocean for everyone’s benefit. Investing in SIDS is investing in the ocean.

How many coastal people are vulnerable to climate change?

Roughly three billion people live in coastal areas, and more than two billion people are already at heightened risk from sea-level rise, flooding and intensifying storms. The Ocean Risk and Resilience Action Alliance (ORRAA)’s Coastal Risk Index shows that without natural buffers, such as reefs and mangroves, an extra 14 million people would be flooded every year.

ORRAA’s mission is to boost the resilience of 250 million climate-vulnerable coastal people in the Global South by 2030, and Outrigger Impact is an initiative under the SCIFF — ORRAA’s collaborative effort to develop an open ocean financing architecture designed to drive at least USD$1 billion of private investment into coastal and ocean ecosystems, with a focus on the Global South, by 2030.

What is blue carbon?

Blue carbon is the carbon captured, stored and sequestered by coastal and marine ecosystems, primarily mangrove forests, tidal marshes and seagrass meadows. Although they cover barely 2% of the ocean floor, these habitats lock away around half of all the carbon stored in ocean sediments, with mangroves alone holding three- to five-times more carbon per hectare than tropical rainforests.

Investing in high-integrity blue carbon projects can therefore deliver measurable climate mitigation while funding ecosystem restoration and coastal community livelihoods.

Why is restoring mangrove forests beneficial?

Mangrove forests are perhaps best known for their incredible role as coastal guardians, the first line of defense in buffering storm surges and slowing coastal erosion. A 500-meter belt of healthy mangroves can halve wave height, providing $65 billion a year in avoided flood damage and protecting around 15 million people. What’s more, nature-based “green walls” can be up to five times cheaper than man-made concrete sea walls, with the added benefit of self-repairing and growing with sea-level rise.

But they also have an incredible number of other benefits, from food security to carbon storage. As a habitat for many coastal species, mangroves act as nurseries for many fish species and so underpin local fisheries that feed and employ millions. And as a carbon sink, mangroves store 21 billion tonnes CO₂e globally — up to ten times more per area than terrestrial forests.

What among island ecosystems and economies can be regenerated?

When we talk about regeneration in island nations, we’re really talking about healing two things at once: the natural systems that underpin life and the everyday businesses that keep those communities afloat.

On the ecological side, mangrove forests, seagrass meadows and coral reefs can all bounce back if we reduce local pressures and invest in active restoration: re-planting mangrove seedlings, reseeding seagrass beds, or growing corals in nurseries and transplanting them onto damaged reefs. As those habitats recover, the economic systems built on top of them can revive too.

Fisheries thrive again when breeding grounds are healthy; small-scale aquaculture and seaweed farming expand because clean, sheltered waters are available; tourism rebounds as reefs regain color and fish return; ports and ferries can modernize with low-carbon power; and even waste (old nets, plastic or food scraps) can be fed into circular blue-tech ventures that create new jobs.

Each piece reinforces the others. Restored upland forests keep sediment off the reefs, stronger reefs blunt storm waves and protect coastal roads, reliable renewable energy cuts diesel costs for icemakers and cold-stores, and a growing visitor economy funds better conservation. So, regeneration is an interlocking cycle where ecosystem recovery enables enterprise, and enterprise in turn pays for nature to keep on thriving.

This is the broader system into which Outrigger Impact is designed to channel catalytic capital.

What is the Ocean Risk and Resilience Action Alliance (ORRAA) and what does it do?

ORRAA is the only multi-sector collaboration connecting the finance and insurance sectors, governments, multilateral organizations, civil society, and local partners, to pioneer finance and insurance products that incentivize investment into coastal and ocean resilience, and through Nature-based Solutions.  The mission, by 2030, is to activate at least $500 million  of investment to build the resilience of 250 million climate vulnerable coastal people in the Global South.  

ORRAA is delivering system-wide change by growing an investable product pipeline and generating the transformative investment instruments, vehicles and policies that contribute to a regenerative and sustainable blue economy. These solutions enable coastal communities and the Ocean to adapt and thrive, creating greater economic, social and cultural resilience.