“What’s green, slimy and grows in the sea?” It sounds like the start of a bad joke, but the answer – seaweed – is no laughing matter when it comes to building resilience, reducing risk, creating value, and providing a sustainable livelihood for coastal communities in Indonesia.
Seaweed is considered an “ocean superfood” due to its high nutritional value, but innovation in the sector is shedding light on the incredible diversity of this commodity and its potential to serve as a climate change solution. During cultivation, macroalgae provides a buffer for ocean acidification and a source of carbon dioxide removal. Once harvested, it can be used as a gelling agent in the cosmetics, pharmaceutical and food industries, but also as a bioplastic, biofuel, and more.
The industry is projected to grow from USD 15 billion in 2021 to USD 25 billion by 2028, at a rate of 6.2%. According to the FAO, over 35 million tons of farmed seaweed was harvested in 2019, 97% of which was sourced from South-east Asia. For coastal communities in the region, seaweed farming provides welcome jobs and income – but it also helps build resilience in the face of rising sea levels and declining fish stocks. For Asia Affinity, a privately held “value operations” company based in Hong Kong, it’s an opportunity to create long-term sustainable value among MSMEs and informal economy workers.
“We promote inclusion for all people on the path to attaining financial freedom and sustainability,” says Asia Affinity CEO Graham Clark. “We want to provide opportunities for underserved businesses, families and communities to create value and enrich their lives. That includes, of course, helping them manage risk.”
Two of the companies born out of Asia Affinity’s vision are MARI Oceans and Sea Green. MARI leverages cooperative structures and decades of seaweed farming experience in the region to provide support systems, advanced technology and quality seedlings to foster innovation and stabilise household earnings. Sea Green provides the technology which guarantees end-to-end supply chain transparency, with the added value of environmental and financial insights packaged into an accessible mobile app. Currently working in Indonesia, the combined proposition of both companies strives to create a replicable, scalable and sustainable model which ensures management and best practices through risk mitigation and financial resilience.
Despite its position as one of the world’s top seaweed producing nations, the Indonesian seaweed industry suffers from out-of-date practices and fractured supply chains which in turn inhibit revenue growth for upstream producers. The MARI-Sea Green approach seeks to rebalance the wealth across the value chain in an equitable manner. While focusing on income increase and redistribution, environmental issues remain at the core of the mission. The Asian Development Bank, in collaboration with the World Bank, released in May this year the climate risk profile of Indonesia. The country ranked in the top third of countries in terms of climate risk; with the population exposed to river floods predicted to rise by 1.4 million.
Seaweed aquaculture, when managed efficiently, could play a key role in climate mitigation, as studies have shown that seaweed acts as a natural protection against wave impact, helps prevent coastal erosion and acts as a carbon sink. While it is important to be wary of intensive monocultures for any crop, seaweed is one of the few plants on earth which is inherently organic and fertiliser-free, on top of being easily integrated into different aquaculture systems through regenerative farming practices (also known as IMTA). The group firmly believes in enabling bio-secure models, supported by digital and financial education, allowing access to microinsurance.
Asia Affinity’s commitment to risk management is underlined by their active participation in the UNFCC’s initiative of the InsuResilience Global Partnership.
“We want to empower climate-resilient coastal communities by rebalancing the seaweed production supply chain,” says Clark, who also sits on the Advisory Board of the Safe Seaweed Coalition. “We can help them gain access to finance and technology, including insurance. For example, all the seaweed farmers get built-in life, personal accident and catastrophe protection paid for from their seaweed sales.”
Of course, the very basis upon which risk management and insurance is built, is reliable data. Thanks to blockchain technology designed specifically for business interoperability, Sea Green can provide expert insights serving to render the farmers’ operations more efficient, sustainable, and investable, thus stabilising returns for both ends of the value chain. As Clark says, “With the help of technology, the possibilities for communities and businesses are endless.” Sea Green strives to put powerful, yet easy-to-use technology at the availability of all stakeholders to solve their specific needs.
This method is fully realised thanks to the combination between MARI’s ground-based operations which reunite efficient production structures and global partnerships. This framework is projected to generate over USD 10 million in revenue for a thousand farmers by year 2023. Indeed, earlier this year, their engagement for strengthening resilience in coastal communities earned them a spot among the top four winners of the Ocean Risk and Resilience Action Alliance innovation challenge. Here, MARI’s solution was described as “engineering climate-resilient crops; refining farming practices to include polyculture and strengthen ecosystem resilience; enhancing transparency through supply chain traceability; and ensuring farmers’ financial security through blockchain-supported financial services.”
This “new” industry shows great promise in resolving many social, environmental and health metrics. With the right approach and technology, the Asia Affinity group believes in a possible de-risking of the sector to attract investment which seeks to create durable and measurable impact across the globe.