by Steven Lutz - GRID-Arendal
Small Island Developing States (SIDS) are on the front lines of climate change, facing rising sea levels, extreme weather events, and the degradation of their natural resources. Blue carbon ecosystems—such as mangroves, seagrasses, and salt marshes—offer critical climate mitigation and adaptation solutions in these regions. These ecosystems store carbon at higher rates than terrestrial forests and provide essential services like coastal protection, fisheries support, and biodiversity conservation.
Recent Global Environment Facility (GEF) projects, such as the Blue Forests Project and Caribbean BluEFin, have already demonstrated the potential of blue carbon in SIDS. These initiatives have introduced blue carbon to the voluntary carbon market, helping communities like Kenya and the Caribbean generate sustainable income while protecting their ecosystems. For instance, the Vanga Blue Forest project has been independently generating revenue from carbon credits since 2020, benefiting over 9,000 people.
These project impacts and a blue carbon context for SIDS were discussed yesterday at a pre-conference workshop organised by the United Nations Environment Program (UNEP) for the 10th GEF International Waters Conference in Montevideo, Uruguay.
Looking ahead, the workshop emphasised several key areas where GEF can strengthen the impact of blue carbon initiatives for SIDS. One crucial approach is to focus on small-scale, community-driven projects that directly address the local needs of island communities. These projects should be bundled together to create economies of scale, enhancing their market appeal and helping secure more significant investments. Additionally, the development of readiness funding facilities could support countries in preparing for blue carbon projects, ensuring they are equipped with the necessary infrastructure, skills, and policies for success. Another important recommendation was the inclusion of insurance mechanisms to protect these projects from the increasing frequency of extreme weather events, safeguarding long-term returns and reducing risks for investors.
Moreover, the workshop highlighted the importance of innovative financing models to support carbon sequestration and broader ecosystem services, such as climate adaptation and biodiversity conservation. Creating SIDS and climate justice-branded blue carbon offsets was proposed to attract conscious investors eager to support environmental and social justice goals. By enhancing the integrity and transparency of blue carbon offsets, GEF can increase private sector confidence and potentially raise carbon prices, ultimately benefiting both ecosystems and local economies.
By adopting these strategies, blue carbon projects have the potential to become a powerful tool for SIDS, fostering resilience, sustainable livelihoods, and environmental conservation.
© 2026 GRID-Arendal
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