A French NGO has partnered with a business accelerator managed by BNP Paribas to launch an impact loan facility for scaling blended finance towards marine conservation efforts in the Global South, aiming to raise $35 million.
Blue Alliance and BNP Paribas’ Positive Impact Business Accelerator seek to provide up-front and early-stage impact financing to reef-positive businesses (RPBs) that operate within Marine Protected Areas (MPAs), they announced on Tuesday.
As the vehicle’s first investors, BNP Paribas ringfenced initial funding of $2.4 mln in what the parties defined as a ‘first-of-its-kind’ initiative.
Investible RPBs include responsible ecotourism, community-based aquaculture, sustainable fisheries, as well as blue carbon credits projects.
“Each reef-positive business reduces specific drivers of coral reef ecosystem degradation, aids in alleviating poverty within vulnerable communities, and contributes financially to MPA management through dividends and/or revenue sharing,” the parties stated in a joint release.
The facility will initially focus on projects developed in Indonesia, the Philippines, Tanzania, and Cape Verde.
It will support the restoration of 1.8 mln hectares of coral reef ecosystems across 115 MPAs that are essential for the livelihoods of around 110,000 local community members.
Source: Blue Alliance
Parties said the vehicle will also rely on philanthropic capital provided by Blue Alliance’s partners, such as the Global Fund for Coral Reefs (GFCR), co-led by the United Nations Capital Development Fund (UNCDF).
As one of the major global coral finance instruments, the GFCR aims to increase the protection of at least 3 mln ha of coral reefs worldwide by 2030, representing approximately 12% of reefs on Earth and 25% of the Coral Reef Breakthrough target, a UN-backed global initiative to safeguard one of the world’s most biodiverse ecosystems.
“With the fourth mass global bleaching now hitting record levels, bolstering the effectiveness of MPAs is more critical than ever,” Pradeep Kurukulasuriya, executive secretary at UNCDF, said.
“Unlocking private finance from partners including the BNP Paribas Group, this innovative vehicle is scaling reef-positive businesses to address local ecosystem threats and contribute to financing 30×30 ambitions.”
According to data shared by the Blue Alliance, to date 70% of the 20,000 MPAs in the world struggle to meet minimum management standards due to insufficient funding.
This is despite the fact that well-designed and enforced MPAs can generate significant economic benefits to the fishing and tourism industries, with some profits in the billions, as estimated by a separate study earlier this year.
“Managing MPAs requires continuous funding not only for set-up but also for day-to-day operations such as monitoring, staffing, and equipment,” BNP and Blue Alliance said.
“With public finance a scarce and precious resource, the mobilisation of additional funds and revenue models for marine conservation is crucial for meeting the financing needs of Agenda 2030.”
Last year, Blue Alliance was also involved in the launch of a separate impact loan for MPAs protection in the Philippines, designed by the philanthropy arm of asset manager UBS.
UBS Optimus Foundation provided $500,000 up-front and early-stage blended capital to France-based Blue Finance, which manages several MPAs in North Oriental Mindoro along with the local government through the Blue Alliance.
By Giada Ferraglioni – giada@carbon-pulse.com
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