Financial Tools for Small-Scale fishers in Melanesia
Project Leads: WWF
Financial Support: In-kind
Subsistence fishing is a critical source of income in Fiji and Papua New Guinea (PNG), but both countries are exceptionally vulnerable to climate and ocean-related risks, threatening the lives and livelihoods of small-scale fishers. ORRAA partners WWF and WTW are developing targeted financial tools for these communities – including the first community-focused risk transfer products in the Pacific – to enhance their financial literacy in order to build their resilience to ocean risk, as part of a project supported by the Global Environment Facility (GEF).
Small-scale fishing is a critical source of income in Melanesia – with between 250,000 and 500,000 people in PNG, and 50% of all rural households in Fiji, estimated to participate in some form of subsistence fishing. However, both Fiji and PNG are exceptionally vulnerable to climate and ocean-related risks, threatening lives, livelihoods and food security in the region. Climate change only amplifies these risks.
Fiji and PNG need financial products which empower small-scale fishing communities and help them recover from shock events and manage long-term ocean-related stressors such as sea level rise, temperature increases and acidification.
ORRAA members WWF and advisory company WTW are developing targeted financial tools for these communities to enhance their financial literacy and resilience. This project, supported by the GEF Challenge Program for Adaptation Innovation, will introduce a programme of novel microfinance products and identify the necessary institutional arrangements and mechanisms for governments, enterprises and households to reduce and share risk and encourage greater environmental stewardship.
The project has four elements: 1) engaging with communities and practitioners to collaboratively assess their needs and identify risk management solutions; 2) developing financial products to support climate adaptation and risk management; 3) providing financial literacy training to households to encourage them to subscribe to those products; and 4) securing sustainable, long-term community coverage, for example, by establishing cooperatives to pool risk.
Scalability and Next Steps
The initiative will design and enable the deployment of the first community-focused risk transfer products in the Pacific.