piracy

The potential of Africa’s blue economy

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This article first appeared in my weekly column of the Business Daily on June 4, 2017

It is estimated that Africa’s coastline hosts a blue economy estimated at USD 1 trillion per year. The UNECA defines the Blue Economy as that which covers both aquatic and marine spaces, including oceans, seas, coasts, lakes, rivers, and underground water encompassing a range of productive sectors, including fisheries, aquaculture, tourism, transport, shipbuilding, energy, bioprospecting, and underwater mining and related activities.

According to Stellenbosch University, Africa’s oceans can and should be an important source of economic activity and growth for the continent, pulling up the standards of living and wealth of Africans. Africa ocean territories are estimated at 13 million km², all of which can drive a blue economy.

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(source: businessfocusantigua.com/wp-content/uploads/2016/12/Blue-Economy-690×457.jpg)

The University of Queensland estimated that the annual economic output of the Western Indian Ocean of which East Africa is a part, is the fourth largest ‘economy’ in the region after South Africa, Kenya and Tanzania. It holds a total asset base of at least USD 333.8 billion and according to UNEP, produces more than USD 25 billion in goods and services every year. The main assets for the region’s blue economy according to the University of Queensland are fisheries, the coastline itself, mangroves, carbon absorption, seagrass beds and corals reefs, carbon sequestration and fisheries. According to UNEP over 60 million people live along the Western Indian coast, many of them deriving their livelihoods from the ocean. In South Africa alone, the blue economy is said to be able to generate 1 million jobs by 2033.

The focus for Kenya’s blue economy according to the Kenya Marine and Fisheries Institute is centred on coastal tourism, offshore oil and gas exploration, deep and short-sea shipping, cruise tourism, fisheries and aquaculture, inland water way transport, offshore wind, blue biotechnology, marine mineral mining, marine aquatic products and ocean renewable energy. However, according to Kenya’s Permanent Secretary for Shipping and Maritime Affairs, Kenya loses KES 90 billion per year in the sector and fails to generate hundreds of thousands of jobs due to a lack of financial support to the sector exacerbated by the under-management and failure to invest in building skilled human capital for and of the sector.

Image result for maritime piracy

(source: media.wsimag.com.jpg)

Sadly, Africa’s ocean areas also tend to be poorly governed with high levels of insecurity that facilitate illegal fishing, sea piracy and armed robbery, drug and human smuggling. According to Greenpeace, Western African economies are estimated to be losing USD 2 billion a year to illegal fishing alone. There is also the problem of chronic mismanagement of blue economy assets. A report led by the World Wildlife Fund found that 35 percent of the fish stocks assessed in the Western Indian Ocean are fully exploited and 28 percent are over-exploited. If the trend continues, Tanzania and Kenya could lose 18 percent of mangrove cover over the next 25 years. Further over 50 percent of the region’s shark species are threatened and 71-100 percent of the region’s coral reefs are at risk.

As Kenya begins to design the priority areas of the Medium Term Plan III under Vision 2030, the blue economy ought to receive special attention. Bear in mind that it will likely be difficult to wrestle the blue economy from the control of illicit players but there is a need to not only do so but also more effectively monetise the sector so that it can become an important generator of economic and social development for the country.

Anzetse Were is a development economist; anzetsew@gmail.com