Blue finance: Making waves for sustainable oceans and freshwater resources

Water is a key pillar of life and livelihoods — but it is massively underfinanced. From oceans and rivers to water supply and sanitation systems, the infrastructure that underpins growth, jobs, and human wellbeing is under growing strain. 

Our economies, communities, and future depend on attracting investment to the water sector.

With an ambitious target of improving water security for over a billion people by 2030, Water Forward is a new global coalition bringing together governments, multilateral development banks, and the private sector to make water systems investable, sustainable, and capable of supporting long-term growth and prosperity. 

One of the central tools enabling this ambition is blue finance — an innovative financing approach that uses instruments like blue bonds, blue loans, and other sustainability-linked investments to fund projects that keep our water resources healthy, clean, and thriving. This includes everything from sustainable aquaculture and marine conservation to water security, sanitation, and eco-friendly coastal tourism. It’s like giving the ocean and water infrastructure a financial lifeline.

The Blue Economy is Booming

The Organisation for Economic Co-operation and Development predicts that the blue economy will grow from an already significant $2.6 trillion in 2020 to $5.1 trillion by 2050. But it must grow sustainably. Blue finance maintains a balance between economic growth and protecting our oceans and waterways — a way to tackle big issues like plastic pollution, overfishing, and water shortages while creating new opportunities for businesses and communities.

At the World Bank Group, we are focused on ensuring that blue finance delivers on its development promise. That means channeling private investment into projects that not only protect water resources but also create jobs and long-term economic opportunity.

Blue finance isn’t just a buzzword — it’s already making waves. Since 2020, the International Finance Corporation (IFC) has provided over $2.1 billion in blue finance through loans and bonds to fund projects like plastics recycling, marine conservation, and water efficiency. Each of these transactions supports industries that generate employment and resilience in emerging markets — as in the Philippines, where IFC’s investment in BDO Unibank’s first blue bond is supporting the country’s coastal blue economy and strengthening the marine ecosystem; and in São Paulo, where a $150 million IFC loan to SABESP is expanding sewage collection and treatment in the city’s poorest neighborhoods while reducing pollution of the Pinheiros River. And with the support of technical assistance from the World Bank, The Seychelles issued the world’s first sovereign blue bond in 2018, raising $15 million to support marine conservation and sustainable fisheries. More recently Ørsted became the first energy company in its sector to pioneer the blue bond landscape. These examples prove that blue finance isn’t just a compelling idea — it’s a practical driver of sustainable development.

The public and private sectors must work together to create markets, attract investment, and build resilience in industries critical to emerging economies. Together, we can unlock the full potential of the blue economy — boosting growth and creating jobs while ensuring people have access to clean water and protecting the planet.

Blue Finance Guidelines are Part of the Water Forward Toolkit

As Water Forward works to create conditions for scaled investment in water systems, IFC’s updated Guidelines for Blue Finance provide a solid framework for launching, scaling, and evaluating blue finance projects—clear definitions, aligned standards, and measurable impact indicators that help investors engage with confidence. 

The latest version expands and strengthens the framework in several key ways:

• More Sectors, More Impact: The new guidelines expand the list of eligible projects in water, transport, and marine technology.
• Measuring What Matters: To ensure transparency, the guidelines introduce specific impact indicators to help track the environmental and social benefits of investments — from cutting plastic waste and saving water to reducing pollution in aquatic ecosystems. Projects must demonstrate measurable results and adhere to environmental and social standards.
• Sustainability-Linked Indicators: The guidelines address how to design sustainability-linked bonds and loans with blue-focused goals.
• Real-Life Examples: The guidelines include case studies and tools to help practitioners get started — for instance, how a manufacturing company could use blue bonds to fund plastics recycling, or how a water utility could use sustainability-linked loans to increase water efficiency.
• Global Standards, Local Impact: Alignment with international best practices such as the Green Bond and Green Loan Principles ensures credibility and consistency, giving investors the confidence to trust the process and helping projects attract greater funding.

The blue finance market is still evolving, and IFC is committed to keeping things moving in the right direction. Combined with technical assistance and direct investment operations, the updated guidelines form a trilogy of interventions that reinforce each other to build markets, mobilize private capital, and create jobs at scale. This approach is part of IFC’s broader effort to create sustainable finance markets globally. 

Through Water Forward, the World Bank Group and its partners are working to turn this momentum into lasting systems change—and blue finance helps build the financial architecture to ensure that where water flows, opportunity can follow. That’s how we build a future where our oceans and waterways aren’t just surviving — they’re thriving. Blue finance is a win-win for people, businesses, and the planet.

Source : World Bank