Across the Pacific, local entrepreneurs are proving that sustainable businesses are the engine of the region’s economic future.

What began five years ago, as an experiment to protect Fiji’s fragile coral reefs has now grown into regional initiative across the Pacific. The launch of the Sustainable Pacific Blue Circle Fund, backed by an EUR 8.8 million commitment from the European Union, will support entrepreneurs who advance sustainability and protect vital marine ecosystems in Fiji, Papua New Guinea, Samoa, Solomon Islands, and Vanuatu.

Designed to support the blue and green economies as well as strengthen climate resilience, the Fund will help businesses, particularly those led by women and youth, to scale, access finance, and attract investment. The initiative aims to empower over 30 Micro, small, and medium enterprises (MSMEs) and create an estimated 100 new jobs by December 2028.

Fiji’s Minister for Finance, Hon. Esrom Immanuel, noted that the initiative aligns strongly with the region’s broader ambition for sustainable growth.

“Micro, small, and medium enterprises are central to our economy and to the livelihoods of our people. The Sustainable Pacific Blue Circle Fund responds directly to these challenges by helping businesses strengthen their capacity, improve investment readiness, and better access sustainable financing opportunities.”

Sea turtle swimming over a coral reef, Fiji. Photo: Tom Vierus, Ocean Image Bank.

A new financing pathway for reef-positive enterprises

The regional initiative builds on financing models already being developed at the country level. In Fiji, the United Nations Capital Development Fund (UNCDF) is absorbing financial risk to encourage private investment in businesses that protect critical coral reefs.

Fiji’s coral reefs support food security and livelihoods, help protect coastal communities from storms and provide habitat for diverse marine species. These ecosystems are increasingly affected by warming seas and ocean acidification, alongside overfishing, pollution, and sedimentation from coastal development.

To help address the resulting financing gap, UNCDF has deployed a USD 920,000 credit guarantee with the Fiji Development Bank (FDB), enabling the bank to expand its portfolio into the blue economy that provides financing to ‘reef-positive’ entrepreneurs committed to Fiji’s sustainable future.

The facility, known as the Blue Lending Facility, is a joint effort with the United Nations Development Programme (UNDP) and the United Nations Environment Programme (UNEP), and is funded by the Global Fund for Coral Reefs and the United Nations Joint SDG Fund.

Under the facility, UNCDF structures and deploys the financial guarantee, UNDP supports and trains local businesses, and UNEP tracks the environmental impact, including changes in reef health. It is designed to do more than protect ocean biodiversity. It also seeks to strengthen coastal livelihoods and demonstrate that reef-positive businesses can become viable recipients of commercial finance. It aims to unlock $1.3 million in new loans for reef-positive enterprises and support jobs and livelihoods. About 30 percent of these businesses are expected to be led by women.

Reducing risk to expand lending to reef-positive businesses

UNCDF’s guarantee absorbs a portion of the lending risk, giving the bank the confidence to fund new, reef-positive businesses that might otherwise be considered too risky to support. Reef-positive enterprises pursue commercially viable business models while contributing to the protection, sustainable management or restoration of coral reef ecosystems.

They include sustainable fishing businesses that neither overfish nor destroy the seabed; eco-tourism ventures where resorts and tour operators actively protect and replant coral reefs; waste management outfits that prevent plastic and pollution from reaching the ocean; and marine technology businesses that are developing innovative ways to monitor reef health or farm seaweed sustainably.

The facility is further complemented by the Pacific Insurance and Climate Adaptation Programme (PICAP) and the Pacific Digital Economy Programme (PDEP), initiatives supported by the New Zealand Ministry of Foreign Affairs and Trade, and the Australian Department of Foreign Affairs and Trade.

By partnering with PICAP, reef-positive enterprises gain access to specialized climate-risk insurance solutions that strengthen the resilience of coastal businesses and help them recover more quickly after extreme weather events.

Together, the Sustainable Pacific Blue Circle Fund and Fiji’s Blue Lending Facility demonstrate how catalytic finance and targeted business support can reduce early-stage risk, strengthen local enterprises and unlock financing for markets that conventional finance does not yet reach.

By building a pipeline of investment-ready reef-positive businesses, these partnerships are helping Pacific countries protect critical marine ecosystems, create jobs and livelihoods, and turn climate and biodiversity priorities into viable financing opportunities.