Overview
The Southeast Asia Blue Innovation Facility (SEA Fund) is a USD 500 million blended finance debt vehicle designed to drive maritime decarbonization, climate adaptation, and inclusive economic development across Southeast Asia’s blue economy. The Facility will be structured as a USD 450 million sustainability bond or asset-backed security to finance demonstration and first-of-a-kind (FOAK) infrastructure projects, such as climate-resilient ports, clean shipping technologies, and nature-based coastal protection, alongside a USD 50 million venture capital fund dedicated to early-stage ocean and climate-tech startups.
Problem
Southeast Asia hosts some of the world’s busiest and most climate-vulnerable ports, yet innovation for maritime decarbonization and adaptation remains constrained by high capital costs, fragmented coordination, and scarce early-stage funding. The region’s shipping sector is dominated by small, resource-constrained operators with outdated fleets and limited access to affordable long-term capital. The transition to zero-emission shipping remains aspirational, with LNG as a temporary fuel and alternatives like ammonia still years from commercial viability.
Meanwhile, the blue economy faces intensifying climate risks: inter-island shipping lacks support to decarbonize, and coastal communities dependent on fisheries, aquaculture, and marine tourism face eroding shorelines, declining stocks, and saline intrusion. Nature-based solutions, such as mangrove restoration and regenerative ocean farming, also remain small-scale pilots, hindered by weak monitoring and limited blended finance opportunities for scaling up.
Solution
The SEA Fund aims to blend large-scale debt with venture equity under a unified impact, governance, and innovation framework to address the risk and novelty of FOAK and emerging technologies, which remain under-tested and struggle to attract capital at scale. Under the proposed blended finance vehicle, 90% of the raised capital will be deployed towards climate adaptation and decarbonization projects, while 10% will back ocean and climate-tech startups in Southeast Asia. Concessional capital will be utilized to de-risk loans to ports and maritime firms, while the venture sleeve will support the development of next-generation technologies. The issuance of the sustainability bond in accordance with ICMA standards will enable low-interest loans, while the venture equity fund will target market returns on standard terms.
Anchored by a regional multi-stakeholder coalition, the SEA Fund will convene governments, ports, investors, and corporates to align priorities, share knowledge, and co-develop scalable solutions. A dedicated technical assistance facility will further strengthen project preparation, MRV systems, stakeholder engagement, and capacity-building, ensuring capital flows smoothly from pilot to deployment.
CC Facility Support
The CC Facility’s funding is critical to advancing SEA Fund from concept to launch, enabling it to address systemic challenges in the marine decarbonization sector through its proposed vehicle. Additionally, the CC facility would provide technical assistance to support the structuring of the vehicle, offer strategic advisory services on engagement with concessional capital providers, and facilitate the integration of a gender lens across the vehicle’s operations.
Website
https://www.artesianinvest.com/