SEPTEMBER 11, 2023 | Nature, Climate, and the Economy
A New Project on Innovative Financing for Sustainable Marine Conservation in Sri Lanka

Ecological conservation sites cannot operate without proper financial planning and management. In Sri Lanka, sites are operational, however, can stand to benefit greatly from revisiting theoretical and practical considerations of planning and management. Moreover, unlocking innovative financial solutions is only possible once conservation and financing stakeholders are on the same page regarding the issues, objectives, and outcomes of conservation. While financiers may be aware of the opportunity, the lack of awareness and knowledge on science-based conservation metrics too limits the attention given to this space.

The Centre for a Smart Future is partnering with the Blue Resources Trust on a research and advocacy project to advance innovating financing for sustainable marine conservation in Sri Lanka, under a project funded by the Oceans 5 consortium.

Why is this project important now?

As Sri Lanka slowly emerges out of a debilitating economic crisis, recovery must be anchored to considerations of natural capital and environmental conservation. A green and sustainable growth path must be a priority. Yet, many signs indicate that the opposite may be followed. In a bid to regain ‘lost’ growth, environmental compromises are likely to be made, and development may come at the expense of natural habitat preservation. Moreover, the acute fiscal crisis and the ongoing austerity measures imposed under a debt restructuring programme mean that resources for conservation become even scarcer than they were before.

Yet, there is a distinct opportunity to ‘build forward differently’, rather than just ‘build back better’. Conserving nature, and anchoring progress to natural capital, can attract new sources of responsible finance that are now increasingly becoming available globally. So, for Sri Lanka too, innovative financial mechanisms offer a great opportunity. From small-scale grants for sustainable start-ups to national-level programmes such as debt-for-nature swaps (DFNS), these mechanisms can supplement current funding and leverage new forms of capital that are at the nexus of nature and finance.

Sustainable finance is now estimated to be a US$ 37.8 trillion industry. 35.9% of global assets under management are considered to be in the sustainable investments-only space . In the marine space alone, countries like Ecuador, Belize, and Barbados have raised a total of US$ 1.3 billion in blue bonds since 2018.

About the project

This project will have two main components – firstly, helping advance the knowledge and understanding of available sustainable marine conservation financing and secondly, demonstrate how these can be practically deployed in example sites in the country.

Under there first component, CSF will improve knowledge and awareness among Sri Lankan stakeholders in civil society, financial services organizations (banks and non-bank finance companies), scientific research and conservation community, and business community; we will produce and disseminate a set of primers/introductory notes on selected set of marine conservation finance instruments of relevance to Sri Lanka, as reference material for Sri Lankan stakeholders; and we will convene a series of stakeholder roundtables to discuss options available, challenges, and opportunities for practical deployment of them.

Under the second component, CSF will work closely with Blue Resources Trust and other stakeholders to conduct scoping at identified sites (currently a priority on Mannar) to assess the conservation financing ecosystem and institutional landscape, and identify issues and constraints; we will convene on-site stakeholder workshops to validate these scoping assessments, and develop roadmaps on how financing could be designed better; and then use the stakeholder workshops to test ideas of potential new and improved options for sustainable marine conservation finance relevant to each site.

What we hope to achieve

We aim to enhance the existing knowledge and address any gaps between the marine conservation community and the finance fraternity in Sri Lanka. By doing so, this will lead to more effective marine conservation on sites, as well as, financial concepts and mechanisms educating these communities on innovative solutions to funding and financial issues. With the conservation communities’ conservation aptitude set, this will have a clear message regarding the viability of conservation projects and financing towards a sustainable marine finance plan with the banking and finance communities, investors, and arrangers as well.

Moreover, by feeding in knowledge inputs and facilitating the meetings and discussions, this process of joint discovery ensures to be inclusive, addressing core issues, gaps and presenting solutions.

If you would like to know more, or have an idea to collaborate, write to [email protected]

Knowledge Insights