Scaling finance for Indonesia’s MPAs through reef-positive investments 

Scaling finance for Indonesia’s MPAs through reef-positive investments 

Project Lead: Blue Alliance Marine Protected Areas
Supporting Partners: Ministry Of Marine And Fisheries Of Central Sulawesi; Global Fund for Coral Reefs, UNDP, New York; Blue Natural Capital Finance Facility (IUCN), Switzerland; UBS optimus, Switzerland; AXA Climate;  Milkywire; Catalytic climate finance facility – Convergence; Genesis Charitable Trust, UK
Location: Indonesia
Project Timeline/Status: January 2025 – March 2026

Project Summary 

Blue Alliance is building a scalable financial model for large-scale Marine Protected Areas (MPAs) in Indonesia, through investment in the regenerative and sustainable blue economy, starting with a 600,000 ha MPA network in Banggai, Central Sulawesi.  

In collaboration with the government, Blue Alliance co-manages the MPA network while developing a portfolio of four bankable reef-positive businesses. These include community-based aquaculture, sustainable fisheries, ecotourism, and blue carbon credit initiatives, all designed to curb coral reef degradation, uplift coastal livelihoods, and generate sustainable revenue streams for the MPAs. 

Additionally, the project contributes to a global MPA blended finance vehicle, attracting private debt capital through risk-mitigation mechanisms. Having demonstrated success in Belize, the Philippines, and Tanzania, this scalable model offers a blueprint for sustainable marine conservation and fosters growth in the regenerative and sustainable blue economy. 

Challenge 

Coral reefs are critically important for Indonesia, providing coastal protection for over 18,000 islands across the archipelago, yet more than 85% of reefs within the Coral Triangle region are currently threatened by stressors (IDRC, 2024). While MPAs are crucial for conservation, many fail due to reliance on short-term, publicly funded models. Without long-term financial sustainability, these MPAs risk becoming ineffective, leaving marine biodiversity and coastal communities vulnerable. 

Solution

Blue Alliance bridges this funding gap through impact-driven bankable enterprises generating revenue for MPAs while also providing socio-economic and employment benefits for communities living nearby. By deploying early-stage blended capital, they create investment-ready businesses that align conservation with blue economy development. Proven in Tanzania and the Philippines, the model leverages revenue streams from responsible ecotourism, community-based aquaculture, sustainable fisheries, and blue carbon initiatives, ensuring MPAs are both ecologically and financially sustainable.   

Scaling and Next Steps

Beginning with the Banggai pilot MPA network, where Blue Alliance and partners have been active since 2021, the project will scale by fostering reef-positive enterprises, improving food security, and enhancing climate resilience. In partnership with ORRAA, the project will also contribute to the global MPA blended finance vehicle, supporting sustainable MPAs worldwide.