Impact Investing to Clean the Ocean: Blue Bonds

Category: Blog, Impact Investing Date: 10 August 2022

In recent years, many scientists have been trying to find the answer to where the 8 million tonnes of plastic waste dumped into the ocean every year goes. The general assumption is that most of the plastic waste is collected in the garbage patches in the middle of the ocean caused by currents. However, according to the latest findings, the amount of plastic waste accumulated in these areas is much less than the amount discharged into the ocean.

As scientists work every day to find the reason for the huge discrepancy between these two, the answers they find will help prevent further damage to life and ecosystems in the ocean through future ocean cleanups.

As scientists surveyed five ocean garbage sites around the world, they found dozens of types of plastic waste in the nets they spread on the surface of the water – from water bottles to laundry baskets, from hard hats to toilet seat covers. That being said, it was discovered that the plastic waste in the garbage patches was only 300 thousand tonnes. Considering that 8 million tonnes of plastic waste is dumped into the ocean every year, where do the vast majority of these plastics in the ocean go to?



Plastic waste in the oceans can also be found in the form of microplastics. Microplastics are plastics smaller than 5 mm in size, are usually pieces of synthetic fabric or formed from the decomposition of larger plastic wastes. Microplastics can be found not only on the ocean surface, but also on the ocean floor and even inside planktons, the tiniest creatures in the ocean.

In seafloor sediment extracts taken off the coast of California, plastic fibres and fragments of no more than 1 mm in length were observed from 1834 until 2009.  The microplastic density also confirms the fact that plastic production increased rapidly after 1945. Since then, in line with global plastic production, the amount of microplastics in each layer in the sediment sample doubled every 15 years.

Another striking aspect about microplastics is that particles smaller than 10 microns are not included in recent studies, and there are much more microplastics out there in the oceans than we can see or measure.


Macroplastics Sinking to the Ocean Floor

Another study found that about half of the larger plastics in the garbage patches are denser than seawater, so they can sink to the ocean floor on their own. It was observed that the less dense plastics became heavier and heavier over time, as colonies of various organisms such as mussels established colonies, and began to sink to the ocean floor before decomposing.


Plastic Waste Close to the Shore

All these findings point to the fact that the plastic waste that remains on the surface in the middle of the ocean was produced within the last 10 years. An intact plastic box from 1971 found floating in the Great Pacific Garbage Patch tells us otherwise. In fact, the plastics that accumulate in the middle of the oceans are so resilient that they can remain there for decades – or even centuries. 


According to the data from The Ocean Cleanup, plastics found along the coast have much closer production dates than plastics floating in the middle of the ocean. Scientists have used this piece of information and the exponential increase in plastic production to reach the conclusion that most of the waste is on or near the coast. The vast majority of plastic stays within a maximum distance of 100 miles from the coast and washes ashore over and over. Such friction, fragmentation and abrasion in the sand explain the microplastics found in the intestines of sea creatures and sediment samples. 

Keeping plastic waste near the coast is much more dangerous than letting it float in the open ocean, both in terms of biodiversity and economic value. While it is unlikely that all waste on the shores could be collected, the impact of collection efforts is undeniable. In 2018, more than 1 million people collected more than 10,000 tons of trash through Ocean Conservancy’s planning alone.

The Ocean Cleanup has removed more than 100 thousand kilograms of plastic waste as of July 2022 in its ongoing activities in the Pacific Ocean. In over 45 extractions since August 2021, using the system codenamed 002, 101,353 kg of plastic was collected in an area larger than half the area of Istanbul.

The design of the system codenamed 03, which is nearing the end of its development phase, considers the cost of collecting one kilogram of plastic waste as the most important criterion. System 03, which will operate more efficiently thanks to a combination of increased size, improved efficiency and increased uptime, is expected to potentially collect plastic at a rate 10 times higher.

The biggest factor in reducing waste in the oceans is, of course, not dumping waste into the oceans in the first place. Taking decisions and implementing certain regulations to eliminate single-use plastics and to improve recycling and sanitation infrastructures will be effective steps to solve the plastic crisis in the seas. While there are many problems besides waste that threaten aquatic life, such as overfishing, climate change and the increasing acidity in the oceans, resorting to alternative ways with more daring goals will greatly accelerate the improvement of the situation.


Blue Bonds

Blue bonds are a type of impact investing model that helps provide capital for projects to improve life in the seas and oceans, the first example of which we saw in 2018 in the Seychelles. The Nature Conservancy (TNC) brought together the World Bank, investors, country governments and benefactors to negotiate blue bonds.

In exchange for a commitment by the Seychelles’ government to protect 30% of the waters near its shores, the state is able to restructure its debt (by extending payment terms and lowering interest). The amount “saved” goes into a fund for the continued protection of the protected areas and the overall development of the blue economy in the country. In short, blue bonds create a situation that benefits everyone involved. With the savings from sovereign debt, countries invest in their natural resources and strengthen their economies. The cultural heritage and livelihoods of local communities are protected. Lastly, investors reap the rewards of their investments with valuations up to 40 times higher.

The Nature Conservancy has set a target of increasing the size of protected areas in the oceans by 15% in the next 5 years and pointed out that blue bonds can be implemented in 85 countries. In just the first 10 years of protecting ocean life in a region of the Baja Peninsula in Mexico, all the effects of overfishing have disappeared and fish stocks have quadrupled. In 2019, we saw Morgan Stanley invest $10 million in a blue bond to remove 50 million tons of plastic waste from the seas by 2030. As a result, it is clear that blue bonds have great potential both to create a positive environmental impact quickly and to raise investments more easily.