Explore the factors enabling local blue growth
What enables local blue growth in developing countries? How do you make sure it benefits the locals on the coast? Perhaps not what you think…
Adequate, accessible and well maintained infrastructure is a prime prerequisite for local blue growth
Blue businesses rely on infrastructure that is accessible, reliable and of adequate quality. This includes basic infrastructure such as good roads, electricity, potable water, sanitation and telecoms, as well as specific maritime infrastructure such as ports, landing sites, locally available maintenance equipment, cold storage and processing facilities.
Irrespective of whether such infrastructure is provided by public or private entities, its availability correlates strongly with social and economic wellbeing in most contexts. In general, the availability of basic and maritime infrastructure is a condition for investment in the blue economy.
It is essential that infrastructure is well maintained, so that it retains its function over the longest possible period. The marine environment is very harsh to technical equipment, so continuous maintenance is important to any blue sector.
Infrastructure investments need to consider potentially negative unintended effects, notably in terms of negative environmental and social outcomes, in particular for vulnerable local communities.
Access to credit allows for new investment, technical upgrades and strengthened resilience
Improved access to credit increases the opportunity for community members and organisations to generate local blue growth. Examples of such interventions include the granting of public financial guarantees to back private lending, putting in place emergency relief measures to avert environmental risks and providing public loans for investment in productive equipment and microcredit institutions.
A challenge is how credit institutions often favour those who already have buffers, for example by requiring collateral for the granting of credit or imposing too tight repayment schemes. This can be a challenge for many small businesses, as they often lack sufficient financial or material resources, and need more time before they generate enough revenue and overcome their initial vulnerabilities.
Access to credit for small business can unlock opportunities for community members and organisations to start new businesses, improve and upgrade existing ones and strengthen their capacity to deal with the consequences of crises and unexpected costs.
Organisation of local community actors supports blue growth
Community organisations and networks play important roles for local development. Being a member can contribute to higher income and employment opportunities within fisheries, aquaculture, and tourism.
These organisations need a legitimate and dynamic leadership. They should work towards gathering actors around shared norms and values, as well as providing technical training and capacity building.
A reliable administration is also important for the wellbeing of community members. Excessively complex administration and bureaucracy pose particular challenges for less well-resourced stakeholders. This may create or reinforce imbalances between different groups in a community.
Cooperation at the community level is also an effective strategy for achieving more environmentally sustainable management practices. One example is the local comanagement of natural resources such as fish stocks, coral reefs and mangroves.
Coherent and predictable legal frameworks and policies form the basis on which to build local blue growth
Laws and policies need to be coherent and predictable so stakeholders can understand and adapt to the conditions and requirements they impose.
Coherence within and between different laws and policies is important for the clarity of the goals and results that society prioritises.
Predictability is key to the willingness to invest in the blue economy, for which the security of tenure and access to resources is often essential.
The institutional framework for blue economy should be anchored in strategies, plans and policies at higher levels, but local blue growth requires political support at the local level as well.
When elaborating laws and policies, attention must be paid to the context in which they are to be applied, in particular to any unintended consequences for communities in general and for local blue growth in particular.
Context-adapted and well-understood environmental regulations make blue growth last
Long-term local blue growth depends on the sustainable management and use of natural resources. Functioning ecosystems are a pre-requisite for sustainable local blue growth. Environmental regulations are used to secure sustainable use.
The effectiveness of environmental regulations and their contribution to local blue growth depends on the degree to which they are evidence-based, context-adapted and understood by those affected by them.
In order for policies and regulations to have an effect, authorities need to have the capacity to enforce and monitor compliance.
Equipping local organisations connected to the blue economy with regulatory and enforcement capacities can enhance opportunities for blue growth. This strengthens the resilience of coastal communities by both increasing their understanding of why a regulation is put in place and supporting the sense of community ownership and responsibility over local resources.
Integration with well-functioning value chains is important for advancing the local blue economy
Local blue businesses thrive best when integrated in efficient supply, processing and market chains.
Securing timely and high-quality supplies is important for many blue businesses, whereas processing generally adds value to products.
The ability to understand and access diverse markets, including international ones, broadens economic opportunities. The same is true of adapting products and services to market demands. Well-preserved products can sell when the market price is high. It is important for local blue growth to ensure not only the openness of markets, but also the coming together of sellers and buyers.
Targeted support to businesses that are essential links of value chains might be required for advancing local economies, because well-functioning value chains are key to local blue growth.
Good governance with functioning institutions provides a foundation for local blue growth
Local blue growth is dependent on the quality and legitimacy of institutions and governance systems. Good governance – reliable, incorrupt, transparent and competent public institutions – promotes society’s trust in its institutions and their legitimacy.
Examples of organisations that play important roles in the blue economy are public institutions in charge of food and safety regulations, facilitation of market information, contract negotiations and rural transport systems. How these institutions are governed affects the possibility of long-term and sustainable local blue growth.
An important feature of good governance is the existence of mechanisms enabling citizens and communities at all levels to have a say in decisions affecting their lives.
Innovation spurs improved technology and better processes within the local blue economy
Innovation enables the development and adoption of more effective technologies in the blue economy. It helps blue businesses to develop new products, explore new markets and reduce costs, including costs to the environment and society.
The capacity of individuals and organisations is key to the development and adoption of innovations, and needs therefore to be incentivised. Strengthening the innovation capacity of local organisations creates opportunities for blue growth and strengthens the resilience of local coastal communities. Facilitating access to credit for small coastal businesses may help strengthen such capacities.
As with infrastructure developments, technological innovations may also have unintended negative effects in terms of enabling the exploitation of new areas and resources. Potentially negative effects must therefore be carefully assessed.
Strategic planning can help remove barriers and pave the way for local blue growth
Planning is about creating the future you want. Strategic planning of coastal and marine areas facilitates the identification and proactive management of opportunities and conflicts over resources and space.
Strategic planning processes reflect the political and institutional interests affecting the future development of a given area. The existence of a development plan can therefore provide a degree of predictability and guidance to investors, stakeholders and communities for investments in the blue economy.
To foster sustainable development, it is important to consider economic, social and environmental perspectives in the strategic planning process. Enabling communities to take part in decisions affecting their surroundings and opportunities is an important aspect of strategic planning and a feature of good governance.
How we did it: four studies into one
This policy brief summarises results from four studies exploring the conditions for lifting coastal communities out of poverty. These studies investigate institutional and infrastructure factors affecting blue growth and social development at a local level in developing countries.
This study examines preconditions for the extraction of marine resources to benefit local communities in the Western Indian Ocean.
17 successful cases have been identified that concern fisheries, aquaculture, conservation and seaweed farming, using United Nation and World Bank literature. The cases focus mainly on small-scale activities.
The cases point to multiple key factors of success.
A common feature in multiple of the cases is the use of cooperative and co-management practices to reach more sustainable levels of resource use. The projects have resulted in stricter restrictions on access to fishing water, cooperation in monitoring efforts of illegal fishing activities, and stronger sense of ownership among fishers. Other forms of cooperation strengthen users’ market power enabling access to inputs and markets as well as providing a forum for knowledge sharing.
Access to credit is very important where initial investments are needed to move into new business areas, such as aquaculture and value-adding activities. Access to credit is often a hindrance for the poor communities which often lack collateral to guarantee loan repayment, but where it is accessible there is potential to increase household incomes
Innovation and new technology have the potential to increase productivity in the blue economy. In two cases, easily accessible new technologies were developed which appear to both increase productivity and are easily implemented in small-scale enterprises.
For the aquaculture sector a number of conditions must be met for fish farming to be successful. There must be functioning supply chains for farmers to access seed and feed as well as the market. Functioning road infrastructure is required to facilitate access. Access to information and credit is important as aquaculture requires technical know-how and initial investments.
Lastly, infrastructure is recognized as a precondition for private sector investment and productivity growth in the fisheries sector. This includes fishing ports, docking and storage facilities, cold chains, logistic networks.
This study is a thematic review of scientific literature identifying prerequisites and factors enabling local blue growth in developing countries. Sectors in focus are fisheries, aquaculture, tourism and conservation.
The review include 90 scientific articles and involves systematic mapping, regression analysis and content analysis.
Value chains and social development matters
Results show that rising incomes and improved socio-economic wellbeing in coastal communities largely depend on the existence of well-functioning value chains and the communities’ degree of social development. It also finds, maybe unsurprisingly, that sustainability of marine and coastal resources are associated with quality of resource management, coherence of policy and legal frameworks as well as the manner in which they are communicated.
Furthermore, inadequate resource management and incoherent policies and laws are associated with lower incomes, wealth and employment, this study finds.
Governance that enable local blue growth
A number of critical factors explaining what type and quality of governance that work as enablers are also identified:
- governance frameworks that are coherent and reliable
- leadership that is dynamic and legitimate
- administration that is reliable
- enforcement that is efficient all enable local blue growth according to results
But it doesn’t stop there.
Communities need a say
Communities need to be given adequate opportunity to influence decisions. Because a number of cases show how policies and environmental regulations and other decisions affecting the livelihoods of coastal communities need to be adapted to local circumstances.
Coastal-community development also depends on the degree of social cohesion and equity in access to resources, as well as on capacity of individuals and organisations in both private and public sector.
Another conclusion is that local blue growth benefits from the existence of well-functioning value chains, markets that are open and accessible, and infrastructure that is adequate and well maintained.
8 recommendations to get local blue growth
Based on the results, this study proposes eight recommendations for consideration by authorities and development agents working for local blue growth:
- Ensure that legal frameworks and policies affecting the blue economy are coherent, clear and predictable.
- Support the development of well-functioning value chains for blue economy products and services.
- Support the creation and development of organisations for blue growth in the local community.
- Appreciate the importance of high-quality leadership.
- Engage local communities in decisions affecting their blue economy.
- Enhance the capacity and technical skills of individuals and institutions of the blue economy.
- Provide and maintain the infrastructure necessary for local blue growth.
- Build local blue growth using the whole toolbox – the above recommendations for advancement of local blue growth should not be viewed in isolation but addressed simultaneously.
Get the insights
Get the full insights from report Enabling local blue growth in developing countries.
Does the presence of basic infrastructure such as roads, harbours, energy and sanitation correlate with local blue economic growth and socioeconomic development in rural coastal communities in the Western Indian Ocean region? Yes it seems.
This study provides some valuable insights to help guide investment in rural coastal communities.
Relationships between basic infrastructure and socioeconomic development were examined using Principal Component Analyses, explained in the report.
11 cases were examined, in Kenya, Tanzania, Mozambique, Madagascar and South Africa.
The correlations observed do not necessarily imply causation.
The results indicate three main points:
1. There is a positive correlation between presence of basic infrastructure and economic wellbeing: The better the suite of basic infrastructure present in a community, the better its economic wellbeing.
Roads and supply of electricity are the most important types of basic infrastructure related to economic wellbeing.
2. Strategic planning is closely correlated with both economic wellbeing and social wellbeing: Communities that show evidence of being strategically planned tend to have higher levels of economic and social wellbeing.
3. The type and intensity of the marine economic activity communities engage in plays an important role in their economic wellbeing.
Communities engaged in:
- tourism tend to have higher levels of economic wellbeing
- aquaculture as primary economic activity have small populations and relatively low social and economic wellbeing
- artisanal fishery largely lack basic infrastructure and indicate poor social and economic wellbeing
- commercial scale fishery have more basic infrastructure present and greater social and economic wellbeing.
Tourism appears to have the greatest potential for driving blue economic growth in rural coastal communities, of the sectors investigated.
Fishery has great potential to facilitate economic growth of communities if it shifts from subsistence basis to a commercial basis. However, this shift would need to be carefully controlled and undertaken in a sustainable manner due to the fragile state of our marine resources, so as to not abruptly remove the basis for the community’s livelihood, whether subsistent or commercial.
Communities need to be examined over time to adequately investigate whether basic infrastructure drives blue economic growth and socioeconomic development.
Get the insights
This report is a study of seven complementary cases of illustrative Swedish experiences, where marine sectors, communities and authorities have collaborated on a local and regional blue economy and sustainable development in coastal communities.
Extracting key challenges, prerequisites, enablers and strategies.
Study aim to:
- share state-of-the-art experiences from Swedish actors working with their own interpretations of blue economy and sustainable development agendas in coastal areas
- map how they deal with challenges and exploit opportunities
- share common lessons – including working strategies – to inspire and promote reflection
The seven cases cover a broad range of blue economy and conservation themes and different types of actor constellations varying geographical and institutional scales.
The cases include:
- Three cross-border initiatives, for example the maritime Border Forum between Sweden and Norway
- The pioneering Maritime Cluster of West Sweden by regional authorities, enterprises and knowledge actors
- A cross-municipal coastal spatial planning initiative
- The Symbiosis Centre developing local blue enterprise in a coastal municipality
- Sweden's first marine national park
Conditions that help initiatives succeed
Some basic prerequisites and conditions help initiatives to succeed. These can be summarised under four thematic clusters:
- mobilisation of mandate and ownership
- necessary capacity and resources
- relevant knowledge and know-how
- place based and physical "hard" infrastructure
The results resonate well with the other three studies in SwAM Ocean and with findings from a number of fields of research and practice, where collaboration and integration across disciplines, boundaries and marine basins is needed, for example integrated coastal management, marine spatial planning, conservation, and rural development.
Initial strengths, weaknesses, opportunities and threats, challenges and related enablers, as well as basic prerequisites could be compiled in a number of common thematic clusters, suggesting for some overarching conditions for blue economy and sustainable development:
- A systems perspective and collaboration of a multitude of different actors, and the development and sharing of relevant knowledge.
- Collaboration to a blue economy based on local terms. The classical triple-helix of academia, business and government needs to be complemented by civil society - for legitimacy, knowledge, reasons, and a complete view on problems, needs and linkages.
- Mandate and ownership, capacity and resources
- Process management and leadership supporting and encompassing the process of collaboration and its content. Time and timing of activities are important. Skills and facilitation capacity.
- Knowledge and know-how
- Social and psychological aspects, encompassing for example awareness and engagement of key actors, building positive attitudes and trust . A “soft” condition easily neglected.
- Supporting place-based aspects, including physical infrastructure.
- Contextual factors requiring awareness and -analysis and related risk and opportunity management and continuous evaluation and adaptation to changes.
Note that this policy brief has its limitations, as all do. Our results are drawn from studies on current and previous states of the world. Thus, current and future strong drivers may come to be very important for any future local blue growth – for example drivers such as climate change, digital transformation, or shifting security.
Functioning ecosystems are key
It is worth stressing that functioning ecosystems are a pre-requisite for sustainable development, and for sustainable local blue growth. Failure to maintain ecosystem functions can be very costly. And to restore nature can cost more than caring for it in the first place. Social, economic, and ecological development are integrated parts.
What you can do
Designing a blue economy project?
Financing coastal development?
Planning the coastal zone?
Consider these nine factors alongside others when you do.
This work is part of our SwAM Ocean, our program for development cooperation