A guide for planners and managers - IUCN

Box I-15. Innovative Financing Mechanisms for Marine Management
PART I
Strategies and Tools
The private sector often has a huge interest in marine resources and ecosystems.
Under proper management arrangements, and with safeguards against commercial and
environmental malpractice, these interests can be used to raise funds for conservation.
For example private investment has been used in Tanzania to raise funds for marine
protected area management. New environmental legislation in Zanzibar allows for
protected area management to be delegated to private entities. Chumbe Island Coral
Park, off Pemba, is now managed by a company formed specifically for this purpose.
Incentives were provided by the government by allocating a lease and management
contract to this company, and the running costs of the park are now almost entirely covered
by private income generated (Riedmiller, 1998). International commercial interest can
also be translated into funding, as evidenced by the use of payments for coral reef
prospecting rights as a means of generating income for marine conservation. A number
of useful applications of coral reef species for medical and pharmaceutical applications
have been discovered, and many more are under development (for example compounds
against cancer, treatments for heart disease, sunscreens and bone graft substitutes. There
is a high level of international commercial and industrial interest in this potential. In
line with this interest Imperial Chemical Industries has acquired the rights to develop
a number of reef pigments for use as sunscreens for humans, and in 1992 the Coral Reef
Foundation entered into a five year contract worth US$ 2.9 million for the supply of
reef samples to the US National Cancer Institute for use in cancer and aids screening
programmes (Spurgeon and Aylward, 1992).
More innovative ways have also been found to channel or administer conventional
sources of finance, including those raised from donor and government funds. For
example the Jamaica National Parks Trust Fund was established in 1991 and capitalised
in 1992 with money from a debt-for-nature swap, under which a portion of the country’s
debt was purchased at below face value with cash provided by USAID, the Conservation
Trust of Puerto Rico, the Smithsonian Institute, Fidelity Investments and The Nature
Conservancy and redeemed against local currency (IUCN, 1994). Additional contributions
have also been received from domestic companies and individuals. The fund is managed
primarily as an endowment trust, paying its expenses through investment income and
leaving the principal untouched. Grants are made to two National Parks, including
contributing to the operating costs of the Montego Bay National Marine Park. New
arrangements have also provided a means of ensuring not just that funds are raised for
marine conservation, but they accrue to the groups who are actually responsible, or bear
the costs associated with, marine protected areas. For example in St. Lucia a collaborative
management agreement has been established between government and a community
institution with the capability of managing a marine protected area and administering
a fee system. Fees raised will be placed in a separate government fund, which will make
quarterly payments to the community institution for the management of the protected
area (Geoghegan, 1996).
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