Maldives shows the way to a thriving ‘Blue Economy’

The Maldives' ocean ecosystem has cared for, fed and employed its population for centuries. It has propelled the country into a top luxury tourism hotspot, with one of the highest blue economy ratios worldwide, accounting for over 36% of its total GDP.

This strong connection between the environment, its people and the economy is critical for the Maldives. Already battling the recurring effects of climate change, an increase in temperature of just 1.5 to 2 degrees could mean the difference between existing as a nation and being a memory on the world map.

Against all odds, the Maldives has pioneered a development model centered around some core elements of the Blue Economy.

Its tourism industry, offering luxurious holiday accommodations and increasingly affordable holiday huts perched above turquoise waters, relies on thriving island ecosystems and marine life, contributing directly to over 30% of its GDP and over 80% of foreign exchange earnings: the sustainability of the industry rests entirely on the beauty and health of its marine and ocean ecosystems.

The Maldives tuna fishery, which has sustained the country for centuries, uses a traditional pole and line technique, taking the industry from a small-scale operation to a globally renowned exporter of sustainably caught tuna today.

For the Maldives, and the vast majority of countries in Asia and the Pacific region reliant on coastal and marine ecosystems, the full potential of the Blue Economy is yet to be realized. It is not just an economic strategy; for these nations, including the Maldives, it's a necessity for their survival.

While fishing and marine-based tourism have naturally flourished, other investment-intensive sectors such as renewable marine energy, marine biotechnology, and green and resilient infrastructure require financing and conducive policies to thrive.

Maldives and the Small Island Developing States (SIDS) in the Pacific are putting in place some of the most ambitious policies to change their challenges into opportunities. Energy security and just transition are key priorities in their Nationally Determined Contributions (NDCs).

Leaping forward, the Maldives announced at COP28 its commitment to developing renewable energy systems, with the aim of meeting 33% of the country's energy needs within the next five years. If this commitment could be realized, it could save almost $750 million currently spent on energy from the national budget.

At the global plastic treaty negotiations in Paris, we have seen the SIDS putting forward an ambitious proposition, involving implementing effective waste management solutions for SIDS funded by plastic producers.

The Maldives is also currently piloting an initiative to establish a sustainable waste-to-energy facility in the capital region, with the potential to expand the initiative across all islands.

Missing finance link

Leading up to the fourth International Conference on Small Island States (SIDS4), the Maldives hosted the first Asia-Pacific Blue Economy Forum, with support from the UK under the Climate Finance Network hosted at the United Nations Development Programme (UNDP).

Participants from 15 countries in the region, along with think tanks and private sector partners, identified common challenges that cut across all sectors in the Blue Economy. These include decreasing Overseas Development Assistance, lack of financing opportunities and access to finance, coastal ecosystem governance and lack of big data and access to innovation.

President Dr Mohamed Muizzu shared similar sentiments on the global stage at SIDS4, and Maldives, with other SIDS leaders, called for a revitalized multilateral approach that could address the financing gap of the SIDS, incorporate measures of vulnerability into the allocation of concessional finance, and reforming the international financial architecture to strengthen the voice and representation of SIDS and developing countries.

To bridge the financing gap and realize the full potential of the ocean's resources, investments need to reach the Micro, Small and Medium Enterprises (MSMEs) that dominate the economies in the region.

MSMEs often drive innovation and open up new market segments, and pooling and de-risking investments are essential for easy access to financing. MSMEs also have the potential to influence market behaviors, as demonstrated by Maldives' own augmented reality digital education app Hologo, stemming across the islands and which has now gained prominence globally in 3D, AR and VR content for education.

Similar innovations include, OdiApp, which is harmonizing the sea transport industry in the country, and eDhumashi, providing a fintech solution for women fishers, expanding their market access and enhancing economic benefits throughout the fisheries sector's value chain.

For the SIDS to unlock their catalytic blue economy and development potential, the national and global partners in the public and private sectors need to act now. The universal acceptance of the Multidimensional Vulnerability Index and related measures could turbocharge access to financing and facilitate needed investments for these nations at the forefront of loss.

This must be matched by continued leadership and actions to realize the potential of an inclusive and sustainable blue economy. As important public goods, the Blue Economy is as important globally as it is for SIDS, and the opportunities the Blue Economy offers are as vast and profound as the ocean.

Blue Economy: A connection as old as time

There is a folk tale from the Maldives, about a man who resides atop a whale, a companion he has shared many years with. Perched on the whale's back, he clings to its fin, and the whale, in turn, understands not to dive deep for prolonged periods to safeguard the man's life.

Occasionally, it submerges briefly if sensing danger nearby. The man sustains himself on raw fish, adeptly catching them with his hands, aided by the whale in locating them. Many fishermen across the Maldives recount glimpsing this man atop the whale, but if spotted, both swiftly retreat into the depths.

The answer towards Blue lies in revisiting the core of the story and age-old wisdom: Maldives' profound connection and dependence on nature. The love and care we receive from the ocean are treasures to cherish for generations to come.

Enrico Gaveglia is resident UNDP representative in the Maldives.

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