Five a week

A weekly digest of key developments impacting investments in the sustainable and resilient future of food, agriculture and forestry.

The power of ten – This week’s UN Ocean Conference (UNOC3) promoted the sustainable development of seas and oceans broadly, but co-hosts France and Costa Rica were particularly keen to accelerate ratification of the High Seas Treaty (HST). So they should be feeling fairly buoyant after 19 more countries completed the paperwork over the course of the summit, held in the French resort of Nice, bringing the number of signatories to 50 – ten shy of total required to bring the treaty into force. This is a big deal because ratification will create a single legal framework for the two thirds of the oceans that lie beyond national jurisdictions for the first time - allowing for greater protection of biodiversity, and enforceable action against illegal and unsustainable fishing practices. Ten is also the number of signatories still required for the ratification of the World Trade Organisation’s (WTO) protocol to end harmful fishing subsidies, as noted in speech at UNOC3 by WTO director general Ngozi Okinjo-Iweala. The protocol is also seen as critical to the elimination of harmful fishing practices, as it will curb the tax exemptions on diesel that make long-distance industrial trawling economically viable. Across the week, a further 20 countries signed up to the HST, indicating their intention to ratify, with several more existing signatories expected to complete ratification in the next few weeks. The treaty becomes law 120 days after the 60^th signatory has ratified, but it’s not quite clear what happens if the target is not reached before the UN General Assembly in September. “We must keep our foot on the #RaceForRatification accelerator,” said Rebecca Hubbard, Director for High Seas Alliance, a group of non-profit organisations which has been tracking progress. One country stuck in the slow lane is the UK. Having signed up to the HST at its launch in 2023, under a previous administration, the UK government has yet to take the first step of bringing forward the primary legislation. This week, however, it did announce that a bill would be introduced by the end of the year. One can only admire the chutzpah of marine minister Emma Hardy in calling for “urgent action” to protect the ocean, given the UK will almost certainly be seeking to jump aboard a ship that has already set sail.

From top to bottom - One of the key ways in which the HST will support ocean biodiversity and sustainability is through the creation of marine protected areas (MPAs), which currently account for just 1% of international waters. A key driver behind this week’s push to ratify the treaty is the protection of 30% of land and sea by 2030 – the main objective of the Global Biodiversity Framework. Although the levels of protection vary, MPAs limit the type and volume of fishing permitted, as well placing restrictions on other potentially damaging activities, such fossil fuel and mineral exploration and extraction. Critically, they’re seen as a critical lever to end the destruction wrought by bottom trawling, as highlighted in Sir David Attenborough’s recent Ocean documentary. While the HST should increase the area of the high seas protected – as well as bolstering enforcement and monitoring activity – this week also saw developments in the protection of MPAs within national jurisdictions. President Ursula von der Leyen told UNOC3 the European Commission was committed to restoring ocean habitats, halving pollution and supporting small-scale fishing via the newly released EU Ocean Pact, which includes wide-ranging new legislation. However, the pact does not contain new measures to designate and manage MPAs, nor banning bottom trawling within them, only reiterating an “aspirational goal” to phase out the practice by 2030 – leaving non-profits non-plussed. The UK government proposed extending a ban on bottom trawling across 41 existing English MPAs covering 30,000 square kilometres. Meanwhile, French president Emmanuel Macron encountered a muted response after announcing stronger protection for MPAs in line with EU objectives. With perfect timing, the European Court of Justice upheld existing protections against bottom trawling and similarly destructive practices contained in Europe’s Deep Sea Fisheries Regulation, rejecting a challenge brought by Spain.

Finance flows – Protecting the ocean and supporting its inhabitants takes money as well as policy. The UNOC3 summit in Nice was preceded by a dedicated Blue Economy and Finance Forum in Monaco, where a variety of financial pledges and proposed investments were unveiled. This funding diversity is needed both to develop the enablers of the sustainable ocean economy – meaning new research, rules, standards, guidelines etc - and to scale the businesses and projects that will attract investors and consumers, according to a new report commissioned by a high level government-backed panel. The numbers involved can be dizzying. The UN has estimated that US$175 billion is needed annually to realise the ambitions of Sustainability Development Goal 14 (life under water), with almost US$16 billion alone required to fund marine protection (around US$10 billion was invested in SDG14 between 2015-2019 but levels are now rising steadily). At the same time, the OECD has forecast the ocean economy could grow by 40% in gross value add by 2050 from its 2020 value of US$2.6 trillion. Newly unveiled initiatives and commitments include a UN-backed scheme called One Ocean Finance, which intends to launch a global finance mechanism by UNOC4 in 2028 to channel finance toward three key outcomes: accelerating industry transition, restoring ocean health, and supporting resilient coastal communities. Among government-level activity, the European Union pledged €40 billion to its Global Ocean Programme to support HST implementation, while financial institutions including BNP Paribas signed up to the #BackBlue Ocean Finance Commitment, increasing to US$3.45 trillion the value of firms pledging to align with ocean sustainability and regeneration. But funds are also flowing through to the smaller companies and projects that will drive the future ocean economy, through impact funds such as SWEN Blue Ocean 2 – which will invest €170 million in startups working in ocean biodiversity – and Outrigger, which will provide grant and loan funding to the regenerative and sustainable blue economy in Small Island Developing States.

Warming waters – While protection of marine wildlife and prevention of resource over-exploitation are fundamental, there are other threats to ocean sustainability, several of which were also addressed in Nice this week. A key concern is whether the oceans will continue to regulate the Earth’s temperature, especially in light of new evidence of warming waters, indicating diminishing capacity to absorb greenhouse gases (GHGs), which has been a critical shield against climate change. France and Brazil launched an initiative to ensure countries “place the ocean at the heart of their climate plans”, which are due to be submitted ahead of COP30 in November. Proposed measures for the plans – which serve as five-year blueprints for GHG emissions reductions – include sustainable and resilient management of marine ecosystems, phasing out offshore fossil fuel production, and cutting emissions in maritime sectors such as shipping. UNOC3 hosts France also coordinated a call from governments for an “ambitious treaty on plastic pollution” ahead of a final attempt to reach consensus on proposals to regulate production and waste management, due to be held in Geneva in August. Company and investor participation in the sustainable ocean economy was also boosted by initiatives to create ‘state of nature’ metrics for the marine realm and other measurements across ocean-related dependencies, impacts, risks and opportunities. At the government level, much will depend on the outcome of last-day negotiations over UNOC3’s political declaration – the Nice Ocean Action Plan – which may or may not match up to the expectations of non-profits, who launched their 30x30 Action Plan earlier this week.

Back on dry land – Significant as it may turn out to be, UNOC3 was far from the only influence on the pace of food system change this week. The UK government, for example, continued its patchy approach to increasing the sustainability of its food sector, and indeed other key industries, in its spending review. Chancellor Rachel Reeves announced a cut to funding for nature-friendly farming, which currently pays farmers to look after biodiversity, soil health, landscape protection and other ecosystem-positive initiatives. Investor network FAIRR said the cuts were short-sighted – in terms of food security, economic resilience and ecosystem stability – noting that “land managed for ecosystem services is commanding a premium, as markets and regulations begin to favour environmental outcomes”. Meanwhile, the government seems keen to push through its Planning and Infrastructure Bill without weighing it down with many nature or sustainability-related considerations. As well as internal Labour party disagreements on environmental protections, external experts have proposed that paying into the Nature Restoration Fund is made optional for property developers who might want to protect nature onsite via biodiversity net gain provisions. The government’s next sustainability challenge will stretch across agriculture, energy and property, as its proposed Land Use Framework takes shape. According to sustainable business lobbyists the Aldersgate Group, “Achieving a land use transition will require enabling policies and regulations, support for skills, and the development of nature markets”.