SIDS4 side event: Closing the Blue Funding Gap - Mobilising a Blue Innovation and Impact Fund for Big Ocean States

Big ocean states (BOS), or Small Island Developing States (SIDS), control 30% of global oceans, holding unique leverage to foster a sustainable blue economy, crucial for attracting necessary investments in Sustainable Development Goal 14 (SDG14). The human capital BOS (SIDS) – its local communities – are invaluable, untapped repositories of local knowledge and innovation in the blue economy.

Despite their role as custodians of vast and biodiverse ocean territories, these big ocean states face significant challenges in accessing the funds necessary for innovation in ocean-related activities and adaptation to the unique sustainable development challenges they face. This disparity in ‘blue funding’ compared to actors in the Global North hampers BOS’ (SIDS’) innovation, resilience and prosperity, and represents a lost opportunity for communities to convert their local knowledge and lived experiences into innovative ocean-related solutions.

It also contributes to brain drain as innovators from BOS (SIDS) may prefer taking their innovations to the Global North for better funding and livelihood opportunities.

The blue funding gap for BOS (SIDS) highlights an urgent need for equitable and sustainable ocean governance and development. As such, a dedicated framework for BOS (SIDS) innovation and financing is urgently required, especially in view of the UN Decade for Ocean Science for Sustainable Development. In this context, a BOS Blue Innovation and Impact Fund is proposed as a targeted approach to close this funding gap.

The central focus of this Fund is to empower and elevate local communities in BOS (SIDS), placing them at the forefront of blue innovation and directing resources to those traditionally underserved. In doing so, the Fund will also promote south-south cooperation and knowledge and expertise transfer in advancing a sustainable blue economy in BOS (SIDS).

Objectives

This side event aims to address the critical issue of sustainable ‘blue’ financing in big ocean states, focusing on the following:

• Exploring the underlying causes of the ‘blue funding’ gap for BOS (SIDS) and its impact on local communities.
• Showcasing ocean-related innovations from BOS (SIDS), amplifying the voices, efforts, and expertise of ocean-dependent communities.
• Discussing actionable strategies to tap into the human capital of BOS (SIDS), including ways to transform local expertise and lived experiences into significant contributions to a sustainable blue economy for BOS (SIDS).
• Establishing the foundation for an ambitious pan-SIDS partnership to set up world’s first BOS Blue Innovation and Impact Fund as a targeted solution to address the ‘blue funding’ gap.

Key themes

• Changing the narrative from “small” to “big”: Reiterate that SIDS are, in fact, Big Ocean States (BOS) (collectively, 3.5% of SIDS is land, while 96.5% is ocean), which similar to other small states, hold the potential to punch above their weight and be seen as leaders rather than victims.
• Equity and benefit sharing: Discuss current challenges faced by SIDS in accessing ‘blue funding’ (including ocean-impact investment funding), explore why SIDS are being left behind in the ‘blue acceleration’, and what sectors (and whom) are current financial flows in the ‘blue acceleration’ benefiting.
• Opportunities for blue innovation and the role of local communities: Highlight the potential of an inclusive and sustainable blue economy to drive innovation and economic growth in BOS (SIDS), and position BOS (SIDS) as a global leader in blue innovation, highlighting current innovations in BOS (SIDS), their successes as well as their constraints.
• Financing mechanisms: Explore innovating financing mechanisms, drawing from experiences both within SIDS and outside, particularly on the establishment of a BOS Blue Innovation and Impact Fund, to address the ‘blue funding’ gap for SIDS.
• Partnerships and collaboration: Call to action for governments, international organizations, philanthropic entities, private sector, academia and other stakeholders to mobilize resources, and expertise towards the establishment of the BOS Blue Innovation and Impact Fund, highlighting the need for both South-South and North-South cooperation.

Linkages to existing initiatives

1. Declaration of the ministers and high representatives of the island states of Africa and the Indian Ocean for the development of the circular economy, convened by the Indian Ocean Commission in September 2023, aiming to accelerate development of appropriate financing and support mechanisms for entrepreneurs and innovators, from ideation to scale-up, in SIDS and IOC member states, enabling regional collaboration and fostering research and development, incubation, and expansion of circular economy businesses in the region.
2. A policy-focused paper, commissioned by the ODI Resilient and Sustainable Islands Initiative (RESI) for the SIDS Futures Forum, on the very topic of “Closing the blue funding gap: how can SIDS mobilise a Blue Innovation Fund for community development?”
3. The Bellagio Dialogue: Reimagining Environmental Multilaterism, co-hosted by Northeastern University and aimed at amplifying the voice and augmenting the capacities of small states in environmental multilaterism, particularly on the forthcoming International Treaty on Plastic Pollution and the Summit of the Future.
4. Commonwealth Blue Charter: An agreement by all 56 Commonwealth Countries, most of which are small states, to actively cooperate on solve ocean-related challenges, and meet the commitments for sustainable ocean action.
5. Big Ocean States Initiative (BOSI), a newly launched community-led, pan-SIDS initiative aimed at closing the ‘blue funding’ gap in Big Ocean States/SIDS. BOSI uses a “for SIDS, by SIDS” approach to develop funding, R&D, and advocacy programs that prioritize, empower, and elevate its local communities, placing them at the forefront of blue innovation and advocacy.

Format

The event will bring together a diverse group of stakeholders, including government representatives, regional organizations, financial experts, ocean-impact investors, environmental scientists, and youth and innovation leaders. It is to be structured as follows:

• Opening remarks (5 mins): Welcome and overview of the Indian Ocean Commission’s Ministerial Declaration for the development of the circular economy in the island states of Africa and the Indian Ocean.
• Firestarter (10 mins): Presenting outcomes of the paper entitled “Closing the blue funding gap: how can SIDS mobilise a Blue Innovation Fund for community development?”
• Panel Discussion (40 mins): From Small Island Developing States (SIDS) to Big Ocean States (BOS): the role of blue innovation in closing the ‘blue’ funding gap for SIDS.
• Parallel breakout sessions (20 mins):
  
  1. Tapping into the human capital of BOS (SIDS): Participants explore the role of local communities, especially women and youth, in driving a sustainable blue economy for SIDS, focusing on opportunities, constraints, and developing actionable strategies to empower these groups.
  
  2. Community-centric financing mechanisms for BOS (SIDS): Participants explore the concept of a BOS Blue Innovation and Impact Fund, discussing potential sources of funding and partnerships, as well as concrete mechanisms to ensure the Fund is centred around science-based, nature-positive and community-led approaches.
  
  3. Policy and governance as enablers of blue innovation in BOS (SIDS): Participants explore existing policy frameworks, identifying policy gaps, best practices, and areas for improvement, and discussing the role of regional and international cooperation.
  
  Rapporteurs Report Back (5 mins): Sharing outcomes and takeaways from the three breakout sessions
  
  Way Forward - the BOSI Launchpad (10 mins): Launch of a pan-SIDS innovation and impact partnership for the ocean, and call to action for partnerships and collaboration.