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Here are the 3 things you need to know

This blog series highlights the main take-aways from the 2^nd edition of the Pan African Community of Practice Series, an annual gathering to discuss tools and innovations to add values to Africa’s biological and genetic resources, facilitated by the UNDP-GEF Global ABS Project and partners. In the spirit of a true Accelerator Lab, the 2019 edition of #AfricaCoP2 brought together development practitioners, experts and various stakeholders to co-design innovative solutions and prototype practical tools to stimulate investments in Africa’s bio-economies and trigger broader development co-benefits to accelerate the progress towards achieving the Sustainable Development Goals (SDGs). 

The resources found in Lake Victoria, the Zambezi river or within its Exclusive Economic Zones, are examples of Africa’s huge aquatic and marine potential, which translates in return into a blue economy encompassing various bio-based economic sectors such as fisheries, aquaculture, tourism, energy and biotechnologies. Indeed, lake Bogoria for instance might be famous for its pink flamingos and thus seen as niche for ecotourism activities, but its micro-organisms can be used in the next frontiers of crop protection and industrial processes such as in the biodiscovery partnership with Novozymes which produces enzymes used in detergents, animal feed and bleaching purposes.

Using marine genetic resources and biotechnology as enablers of blue economy

The growing demand for natural ingredients and for innovative solutions by various industries using genetic resources and associated traditional knowledge, is driving investments in aquatic and marine biotech to develop new products and services. We are talking about samples of aquatic and marine life such as plants, animals, micro-organisms to develop new products such as enzymes, biocides, drugs and cosmetics, or services such as using biotechnologies for bioremediation in case of oil spills. In Seychelles’ blue economy roadmap, biotechnologies were identified among the strategic priorities for action and investment to diversity and explore emerging ocean based sectors. In Morocco, a recent study determined the economic potential of marine genetic resources through a valorization process of aquatic resources (fish scales, bladders, viscera…) for use in cosmetics, medical and agri-food industries.

Stimulating investments in aquatic and marine biotech

Countries need to articulate sound valorization strategies to channel critical investments to support the development of domestic biotech capabilities. Policy makers can set up appropriate benefit sharing mechanisms for up-front payments, royalties, exploitation of intellectual property rights to have a meaningful impact on their bioeconomic. Decision makers can also explore various financing instruments such as blue bonds and provide incentives to biotech start-ups such as tax exemptions and venture capital. Countries’ national policies and roadmaps can also be aligned and adapted to industry needs and standards to develop their restocking and aquaculture based on the exploitation of R & D results in order to economically enhance their aquatic genetic heritage.

Other ideas?   Valuing marine genetic resources in Morocco to stimulate its Blue Economy

Morocco boasts a large maritime coastline that stretches over 3,416 km and opening onto the Mediterranean Sea to the North and the Atlantic Ocean to the West. This wide diversity of environmental conditions and ecosystems means that there is a vast biodiversity potential to preserve and use sustainably.

Large environmental reforms have been undertaken in Morocco in last decade, especially since the country hosted the 22^nd Conference of Parties on Climate Change, in November 2016. As a result, national policies have reconsidered their objectives and solutions for the mitigation, adaptation and sustainable use of its biodiversity have looked for innovative solutions. By 2030, Morocco is aiming to develop an innovative R & D policy in biotechnology and genomics that allows for an integrated valorization of its genetic resources and associated traditional knowledge that meets the needs of national and international markets on natural molecules.

Having identified a great potential for the recovery of study of marine resources (aquatic genetic resources including microorganisms), and with highly developed research infrastructures (universities, institutes, etc.), Morocco is looking to develop ways of valorizing marine resources, including uncontrolled invasive aquatic species, for the extraction of products of high nutritional value, cosmetic, collagen, in order to lighten their pressure on biodiversity. The goal is to set up an aquaculture-assisted reproduction and restoration program, as in the case of red coral. Red coral has long been used to make jewelry for the tourism market, which has led to the destruction of red coral reefs on the national coastline, with a heavy impact on the ecosystems that depend on coral for survival. 

To guide its new national strategy, Morocco developed a pilot study on the economic potential of marine bio-prospection. This case study explored the potential benefits of marine bio-prospecting in Morocco by considering the possibilities of attracting investments through ABS agreements at the very beginning of the process of utilization of its marine genetic resources.

As a starting point, Morocco highlighted its already-proven production capabilities of commercially prosperous marine resources, such as the red alga (Gelidium alga) from which agar is derived. Agar is a viscous substance with gelling characteristics with a wide range of uses in pharmacology, cosmetics and the food industry. In recent years, demand for agar has increased and the global agar market is estimated at $ 247 million. 

Using baselines such as the agar case, experts used The Economics of Ecosystems and Biodiversity (TEEB) methodologies to compare existing ABS agreements for bio-prospecting with the monetary and non-monetary benefits recommended by the Nagoya Protocol, in order to evaluate two monetary benefits of potential agreements: one-time payments for access to samples and associated knowledge (1) and royalty payments in the event that bio-prospecting leads to commercialization of derived products (2). 

As a result, Morocco estimated that potential ABS deals could include a one-time payment for a total of US $ 1 million for access (MAD 10 million) on a yearly basis, and assuming a large portion of the payment is used to fund new research in an institute, this could lead to a direct investment of $ 350,000, on top of indirect impacts for supply chains totaling $ 430,000 as well as a positive impact on the purchasing power of the local population and employees of the research sector of about $ 250,000 per year.

In addition, taking into consideration the average time between the launch of a product and the expiration of its patent (about 13.5 years) in relevant industries, and that the average royalty payments on new products is generally between 0.5% and 2%, Morocco considered that since a typical drug has a lifetime sales value of $ 4.5 billion, one could expect royalty payments between $ 23 and $ 90 million through an ABS agreement, averaging at an estimation of $ 45 million on the basis of a 1% royalty, over10-15 years. 

Of course, these estimates are based on a select case study of genetic resources and with in situ bio-prospecting, there is uncertainty about the actual outcome of a commercial use of the resource as a whole. However, the economic potential valuated is a welcome incentive for the country to develop alternative, more sustainable approaches to using its biodiversity and genetic resources, with an eye in developing environmentally-friendly investments and industries, in line with its national environmental priorities and SDGs.

The study has helped Morocco in adopting a more mainstreamed approach to the valorization of its marine genetic resources and prioritize key steps in order to develop a more attractive, investment-friendly receptacle for industries working in the sector. For example, as cash transfers for bio-prospecting agreements tend to be relatively low, Morocco will try to secure agreements that support a broader industrial strategy, such as by encouraging the development of a higher local productivity activity (acquisition of samples, first phase research, base extraction, etc.), and will look to identify the maximum amount of genetic resources and traditional knowledge prior to negotiations, which underlines the importance of scientific research. Also, early planning of the distribution of funds, through the establishment of a framework on how ABS funds should be distributed, in accordance with the Nagoya Protocol, is currently underway. Such activities and planning could support local capacity building and improve as well access to innovative new products for local populations, ensuring a sustainable use and impact of its marine biodiversity as it develops its blue economy in the medium and long term.

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