The Economist World Ocean Summit |28 February 2017

Seychelles Blue Bond initiative earns kudos

Seychelles’ Blue Bond as an innovative mechanism for financing the Blue economy has 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 from February 22-24.

Seychelles was represented at the Summit by Rebecca Loustau-Lalanne, principal secretary of the Blue Economy Department, and Dominique Benzaken, Commonwealth Senior Advisor on Ocean Governance.

The Summit brought together policy makers, government officials, ministers, economists, international organisations, private investors and bankers to discuss financing solutions for the Blue economy as well as how to address major threats to oceans such as marine pollution, plastics and climate change.

Seychelles’ Blue Bond project was one of three projects selected to be presented at the Summit. Ms Benzaken, presenting the project on behalf of the Seychelles government before a panel of impact investors, successfully defended it..."

The visibility and support for the Blue Bond project at The Economist World Ocean Summit is evidence that the Blue economy and securing private investment are the way forward for Seychelles and Small Islands Developing States (Sids) which depend on their large ocean domain for the present and future development and prosperity.

“For Seychelles, it is important that the design of Blue Bond is robust and credible as an innovative finance model for ocean based economies, which is attractive to investors and affordable for Seychelles (and small islands) and can be replicated and scaled upm,” said Ms Benzaken. 

What is Seychelles’ Blue Bond project about?

With tourism and fishing the main economic sectors, Seychelles’ large ocean provides most of the jobs and livelihoods.  Maximising the full potential of Seychelles’ ocean territory is central to its Blue economy agenda. At its core, Seychelles’ Blue economy is changing the business model focusing on economic diversification, food security and the protection and sustainable use of marine resources.

Bonds are financial instruments to raise public and private capital for specific activities which can generate a return on investment. The government of Seychelles will issue in 2017 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.

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.

Importantly, the Blue Bond proceeds 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, soon to be finalised, is the result of the work of many from the original vision and leadership of the Minister for Finance, 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,” said Ms Loustau-Lalanne.