It sounds like a paradox: A heatwave in the North Pole during the Arctic winter - despite the fact that this northernmost point on Earth gets no direct sunlight for half of the year. Yet it has just happened again, for the fourth time during the past five years. For ten days in February 2018, temperatures in the North Pole stayed well above zero degrees for significant parts of the day.

Scientists are baffled by the frequency and intensity of such deviations in global temperatures. They warn that the recurrence of such extreme events will accelerate sea-level rise, increase the release of heat from warmer Arctic waters into the atmosphere, and disturb the jet stream. Given the interrelatedness of our global climate system, such changes will not remain without consequences for people and the natural environment - even if they are tens of thousands of miles away. The first and most vulnerable ones to experience the consequences of a changing climate are coastal ecosystems and communities in the tropics and subtropics.

The crucial importance of coastal ecosystems

Over three billion people depend on healthy and safe coastal ecosystems for their economic livelihoods, for food and for protection from storms. The economic value of coastal ecosystems is estimated at the scale of billions to trillions. Coastal ecosystems (mangroves, seagrass meadows and tidal marshes) provide numerous critical ecosystem services, including water purification, coastal protection, and nursery areas for fish. On top of this, these ecosystems, along with oceans, store large amounts of carbon – commonly referred to as “blue carbon” For example, oceanic mangroves store almost three times as much carbon than tropical forests, particularly through soil and peat formation. Globally, there could be as much as 20 Gigatonnes of blue carbon stored in mangroves. In other words: mangroves are highly efficient carbon sinks and critical for climate mitigation and adaptation.

At the same time, economic development and rapid population growth are threatening the very existence of these vital ecosystems. The IUCN estimates that to date, 67% of mangroves have been either lost or degraded, making them one of the most threatened ecosystems on Earth. Under a business as usual scenario, all unprotected mangroves could be gone within the next 100 years. This would come with devastating consequences for both people and the planet.

New partnerships that can protect coastal ecosystems are emerging

The issue has of course not gone unnoticed. The UN Sustainable Development Goal #14 (Life Below Water) and many national climate mitigation and adaptation goals recognise the importance of protecting coastal ecosystems. In parallel, many public-private initiatives have emerged to accelerate the necessary action to protect and restore blue carbon ecosystems. For example, the World Economic Forum’s Friends of the Ocean and the High-Level Panel on Sustainable Ocean Economy, chaired by Norway’s Prime Minister Erna Solberg, offer crucial platforms to forge partnerships and advance action on the ground for realising those goals.

Mobilising investment remains a challenge

One critical challenge for protecting coastal ecosystems at the required speed and scale is the mobilisation of investment. As is the case for other climate and sustainable development investment needs, private sector investment and the blending of public and private finance is critically important.

Payment for ecosystem services (PES) offers one proven approach for financing the protection and restoration of blue carbon ecosystems and supporting sustainable livelihoods for coastal communities. In exchange for investing in the protection or restoration of mangroves, for example, investors receive certified carbon credits to manage their own emissions. Such schemes have nevertheless remained quite modest.

Looking ahead, there are, however, three promising elements that can help scale the market for blue carbon and thereby mobilise additional private sector investment to protect coastal ecosystems and livelihoods.

  1. Less than 20% of countries include blue carbon in their NDCs

Over 150 countries have at least one blue carbon ecosystem on their territory; in 71 countries all three types (mangroves, seagrass meadows and tidal marshes) exist. However, only 28 countries have included coastal wetlands in their Nationally Determined Contributions (NDCs), the emission reduction plans under the Paris climate agreement. This gap could point to the need for more countries to include blue carbon in their climate mitigation goals. On the other hand, it can create opportunities for complimentary emission reduction activities on top of NDCs without causing challenges related to carbon double-counting. For example, it creates additional opportunities for investment by companies seeking to protect coastal ecosystems and compensate emissions through carbon offsetting schemes. We explore this point in more detail below.

  1. The voluntary carbon market demonstrates companies will invest

Lessons learnt from the voluntary carbon market suggest that companies seek to invest in emission reduction projects that relate to their core business and deliver social, economic and biodiversity co-benefits. For example, Ecosystem Marketplace reported that 41% of carbon offset buyers look for a “fit” with their organisational mission, and 24% look for co-benefits such as biodiversity protection and community livelihoods when purchasing carbon credits. Those two observations suggest that certified coastal ecosystem protection programmes would resonate with buyers from industries such as tourism, aviation, oil and gas, as well as shipping. Tourism exempt, these sectors are also among the highest emitters of CO2 and have little room for reducing emissions through technology innovation at the required speed, scale and cost.

  1. New compliance market for shipping could mobilise finance

Among the above-mentioned industries, shipping stands out as a possible source of demand for certified coastal ecosystem protection programmes. Currently responsible for about 2.5% of global greenhouse gas emissions, the industry’s growth projections suggest sector-wide emissions will grow between 50% and 250% by 2050 – a trend incompatible with the goals of the Paris Agreement. Nevertheless, the shipping industry has been excluded from the Agreement, similarly to the airlines industry. By April 2018, the International Maritime Organisation IMO (the UN body responsible for regulating international shipping) is expected to release a draft climate change strategy for the entire sector. If the strategy includes a global carbon offsetting mechanisms – similar to the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) – it could generate considerable private sector demand for blue carbon projects and thereby help mobilise the necessary private sector investment to protect and restore coastal ecosystems.

Mobilising finance for blue carbon will be front and centre at this week’s World Ocean Summit in Cancún-Playa del Carmen, hosted by The Economist Group and the government of Mexico. And rightly so: Protecting vital ecosystems and creating sustainable livelihoods for coastal communities is clearly much more than a drop in the ocean of climate action. Failing to protect - and where necessary restore – these ecosystems would compromise our chances of avoiding severe social, environmental and economic consequences of climate change.