Tourism and fishing are the main economic sectors of Seychelles and because the country’s large ocean provides most of the jobs and livelihoods it is important to maximise the full potential of Seychelles’ ocean territory, making it central to its blue economy agenda.

As the Seychelles’ blue economy is changing the business model by focusing on economic diversification, food security and the protection and sustainable use of marine resources, it is important to raise capital for the different projects.

This is how Seychelles in its bid to continue preserving its natural assets, came up with the innovative financing tool – the blue bonds – that will address both the health and economic wealth of our oceans. The blue bonds are financial instruments to raise public and private capital for specific activities which can generate a return on investment and they often fund the development of sustainable fisheries.

The blue bonds is the second innovative financing tool designed by Seychelles as part of its blue economy concept spearheaded by former President James Michel, after it completed an innovative debt-for-nature conversion with The Nature Conservancy in 2016. This deal raised funding to buy US $21 million of Seychelles’ sovereign debt to refinance it under more favourable terms, and then direct a portion of repayments to fund climate change adaptation, sustainable fisheries, and marine conservation projects – as well as to create an endowment for the benefit of future generations of Seychellois.

Yesterday at the Nusa Dua convention centre in Bali, Indonesia, the government of Seychelles launched a blue bond of US $15 million over 10 years with guarantees from the World Bank and the Global Environment Facility to support the transition to sustainable fisheries (see lead article).

The proceeds of the blue bond will be used as grants for fisheries management planning activities and as loans to encourage local public and private investment in activities consistent with sustainable fishing such as post-harvest value adding opportunities and jobs and the protection of ocean resources. The blue bond proceeds will be disbursed on a competitive basis through the Seychelles Conservation and Climate Adaptation Trust (SeyCCAT) and the Development Bank of Seychelles.

Proceeds from the blue bond complements other publicly funded sustainable fisheries projects and the implementation of Seychelles Marine Spatial Plan of its exclusive economic zone (EEZ), a commitment of the Seychelles debt swap for conservation and climate adaptation, bringing efficiency and synergies between fisheries management, marine conservation and climate resilience.

The blue bond project is the result of the work of many from the original vision and leadership of the former President Michel, finance ministry, to committed partners such as the World Bank Group and the Global Environment Facility and the financial advice of Prince Charles Charities International Sustainability Unit.

Speaking at a side event of the Commonwealth Heads of Government meeting in Malta in November 2015, the Prince of Wales, Prince Charles congratulated the government of Seychelles and in particular former President James Michel for the farsighted initiative of the creating and implementation of blue bonds aimed at boosting the fisheries sector.

Prince Charles enforced the idea as vindication of the fact that economic growth and environmental resilience complement each other and should be viewed in the same context.

An innovative mechanism for financing the blue economy, Seychelles’ blue bond received the 2017 Ocean Innovation Challenge award.

The Ocean Innovation Challenge is a competition sponsored by Blancpain (Switzerland) with the aim of rewarding innovative and transformative processes and technologies for oceans. The competition took place at The Economist World Ocean Summit held in Bali, Indonesia from February 22-24, 2017.

Seychelles’ blue bond project was one of three projects selected to be presented at the summit.

So far, three investors – Calvert Impact Capital, Nuveen, and Prudential – have committed themselves to the blue bond and this is what their representatives have said.
“The blue bond demonstrates the potential for capital markets to scale sustainable oceans solutions that expertly align marine conservation and economic opportunity. The oceans finance market is quite nascent, but the need for capital to address threats to the health of our ocean is increasingly urgent. The blue bond sets a great example of the type of bold leadership from governments and financing from public and private sectors that we need more of,” said Jenn Pryce, chief executive of Calvert Impact Capital.

Andrea Kaufman, vice-president, impact investments at Prudential Financial, said: "Sustainable access to food sources, such as fisheries in the Seychelles, can have a transformative impact on communities, providing both sustenance and an opportunity for individuals to achieve financial stability. Prudential shares the long-term vision of the World Bank to make the blue bond a model for future investments to preserve the sustainability of water resources for generations to come."

“The effects of climate change have created both challenges and possibilities for investors. Issuance of the world’s first blue bond is one of the most innovative impact investment developments spurred by this phenomenon that we’ve seen. Most importantly, this security’s attractive relative valuation, along with the technical and financial support of the World Bank, represents a significant opportunity for our investors. Supporting the sustainable development of blue economies such as the Seychelles aligns with our view that investing with a responsible approach is both prudent and financially rewarding in the long-term. We hope this transaction will serve as a template paving the way for creative impact investment solutions in the future,” said Stephen M. Liberatore, managing director at TIAA Investments, an affiliate of Nuveen, and manager of the TIAA-CREF Social Choice Bond Fund.

Gerard Govinden in Bali, Indonesia

Forrás: www.nation.sc