Building a sustainable blue economy

It is important to define what we mean by a sustainable blue economy. “Sustainable” here means that the natural assets that power our economy can keep doing so.

The blue economy itself can encompass any activities taking place in the coastal and marine space. These can have a positive or negative impact on ocean ecosystems. Our global economy has grown almost entirely at the expense of natural ecosystems on land and at sea. Extractive activities offer short term growth and rewards but there is a limit on how long this can be sustained for. This is because the natural resources become depleted or the underlying ecosystems become too degraded.

The blue economy could be shaped around those activities that have a positive impact on the marine environment. For this reason, we want to see a blue economy where policy measures and financial flows are geared towards positive and regenerative activities. This means an economy built around protecting those very ecosystems that provide value, support livelihoods and enhance our wellbeing. Unlike the extractive approach, this vision of a sustainable blue economy can support our society indefinitely.

Often discussions around the sustainable blue economy consider the opportunities and returns it could deliver. These are the outcomes of the blue economy, but to achieve this we must first preserve and build up the foundation of our sustainable blue economy – marine natural capital.

A sustainable blue economy can help the UK economy grow in a resilient, equitable and adaptable manner. This idea recognises the failures of the incumbent model and the fact that the future will be different to the past. A better approach is needed to correct our course and allow us to adapt to a changing environment. Importantly, building a sustainable blue economy offers a new way of doing things.

Equity

The gains of an extractive system tend to be concentrated amongst a few and are not shared equitably across society. Historically, this has favoured large-scale industrial actors or colonial countries rather than local communities and cultures that live in harmony with the marine environment.

A sustainable blue economy should be an equitable one. This means that local and coastal communities - stewards of the marine environment with the knowledge needed to look after it - are key architects and beneficiaries of the opportunities that it provides.

Resilience

Healthier seas and coastal ecosystems can increase food security, protect our coastlines and draw down vast amounts of carbon. There is a lot of uncertainty ahead of us as we move into an era of accelerating climate change, but healthy seas will equip us with the ecological tools to deal with environmental shocks and adapt to change. This resilience extends to our economy and financial sector, too.

The UK economy, financial sector and the environment are inextricably linked. The entire GDP of the planet is dependent in some level on biodiversity, with over half of this GDP estimated to be moderately or highly dependent on it. Most biodiversity is found within the ocean and concentrated in coastal waters – something the UK has a lot of. A leading study by WWF revealed that globally 66% of publicly listed companies have exposure and dependencies on ocean health. The study reported that, in a business-as-usual scenario, $8.4 trillion USD of assets and revenues are at risk over a 15-year period.

Failure to protect marine ecosystems leaves vast economic and financial value at risk. The sustainable blue economy addresses this risk by working with the ecosystems that support this value and not at their expense.

Opportunity

As the sustainable blue economy grows, it would generate jobs, multigenerational livelihoods and economic growth distributed across the UK.

An example of this includes jobs created through nature-based recovery – a largely untapped source of employment for coastal economies. Analysis of restoration programmes in the US revealed that 15 - 30 jobs were created for every $1 million USD spent. This generates six times more jobs than the equivalent investment into oil and gas. Knock-on benefits from job creation in local economies extend to increased property values, higher tax revenues and greater recreational spending. Considering all socioeconomic benefits, coastal restoration is shown to provide a tenfold return on investment.

This is just one example of the opportunities presented by scaling up the sustainable blue economy. It is possible that entirely new industries could arise to take advantage of the benefits of a thriving marine environment.

Understanding financial risks and impacts linked to ocean health are the first steps towards better managing these impacts. This helps to protect financial value, but potentially also to find new ways to generate returns in a sustainable blue economy. It is therefore in the interests of industries and the finance sector to do this. As with any emerging sector, a willingness to take risks and show what can be achieved could be very influential.

The roles of governments and the private sector are woven together. Governments can create the conditions for finance to flow into the sustainable blue economy. At the same time, the private sector has significant influence on government policy. Our hope is that with a better understanding of financial risks and dependencies linked to the ocean, the private sector can also advocate for better ecological conditions to protect financial value and support opportunities presented by the sustainable blue economy. Collaboration with governments, scientific bodies, local communities and the conservation sector can help to create these opportunities.

Throughout 2024 we are running a podcast series in collaboration with the international law firm Simmons & Simmons. Seas Of Opportunity: Navigating The Blue Economy is a series of short episodes where we speak to distinguished experts to gather their perspectives on the why and the how of building a sustainable blue economy. Topics range from the physics and chemistry of the ocean to the legal and policy aspects that can shape the blue economy.

To listen to the series, please visit our blue economy podcast page.