Tsutomu Matsubara (AOA):

Hello, everybody. Welcome and thank you very much for joining the AOA webinar today. I am Tsutomu Matsubara of AOA secretary. This marks the fifth of the SDG series, protecting and building resilience across coastal communities in Asia Pacific is the theme of this webinar, and we have four wonderful speakers.

First is the Mr. Shinsuke Ochi National Mutual Insurance Federation of Fishery Cooperatives. And also from Hong Kong, we have Mr. Graham Clark, the CEO of Asia Affinity Holdings.

And also from Indonesia, Mr. Dodon Yamin, the managing director of MARI Oceans. And last, not the least, Mr. Fred Puckle Hobbs, the chief operating officer of Sea Green Singapore. I’m sure that they would be giving us very interesting, and informative, and inspiring speeches. Now, let me first turn to the chair of the ICMIF AOA, Mr. Yanai. He’ll be speaking in Japanese, so for the English speaking audience, please tune to the translation bar.

Fumio Yanai:

I am the chair. My name is Fumio Yanai. Good afternoon. In opening our seminar, I’d like to say just a few words. Today, from seven countries of the world, we have the participation of many people. Thank you very much. Today is the AOA’s fifth SDG seminar. Japan, where I lived, is an island surrounded on all sides by the sea, and there are abundant marine resources. We consume fish of course and, since ancient times, we have procured from the sea. However, there are many marine problems meaning that there is a risk of not being sustainable; we realised this about 10 years ago at the time of Great East Japan earthquake, marine pollution through plastic debris, and climate change – including the recent abnormal weather. As you all know, global warming is being taken up in a major way by COP26.

There are many issues which are caused by global warming, and one of the biggest issues is global warming due to climate change and its various manifestations in the changes of the sea. There are also many concrete initiatives for SDGs by the ICMIF members all over the world, however rarely in connection with the ocean. However, this Asia Oceania region is also the Asia Pacific region. Many countries are adjacent to the sea and coexist with the sea. And, in that sense, the webinar today is quite special. So with this as the background, in the webinar today, we focus on sustainable community building in the sea, and the title is Protecting and Building Resilience across Coastal Communities in the Asia Pacific. And there will be case studies on initiatives contributing to the attainment of SDGs in the coastal communities that will be presented by two member associations and their subsidiaries, Mr. Ochi of Kyosuiren and Mr. Graham Clark of Asia Affinity Holdings of Hong Kong. And we have also AA Subsidiaries, MARI Oceans, Dodon Yamin san, Sea Green Fred Puckle Hobbs san. Thank you for speaking today and we look forward to your presentation.

Shinsuke Ochi:

Again, this is the overview of my organisation, Kyosuiren. We have the total assets of 451.2 billion, the policies, half a million, 529,000, policies in force insured value, 4.4 trillion, and premium income of 463 million. Claims paid is shown here. There are 388 are working staff nationwide. And the fishery cooperatives that we are working together with, covers the entire country from Hokkaido to the north and Okinawa. There are 879 fishery cooperatives mostly facing those three factors facing the sea, also the number of members, 268,000, and half of it is full member, and the associate members are the remaining 50%. Full members are those members who are full-time fishermen and associate members wear two hats, they are engaging fishing but also in other businesses or work. But in any case, differing the scale, they are involved in fishing activities. This is the business structure. We came into being in 1951, so we celebrated the 70th anniversary last year, and we joined the ICMIF in 1980.

I talked about the membership, 268,000. And also to the members and to the family members, we provide the Kyosuiren Mutual Insurance, the coverage. And we work together with 879 fishery cooperatives, so it’s a joint underwriting between Kyosuiren and fishery cooperative associations. And together, we provide coverage, protection to the members and their families. Let me talk about the role of JF. If you could look at the right hand side, we see the structure of JF. Of course, the primary business is the sales. Sales of marine products. The memberships’ catch are sold on their behalf. So of course, this is the primary role of the JFs. More than half operated from the income of sales of fish and other marine products caught by the members. And also, we have the procurement joint purchasing of fuels that they use in shipping and other materials that they need.

Also, the financial services, the banking are also another area of service. When the fisherman wants to buy the vessels and other tools, they need funds, and we provide financing to them and, of course, the mutual insurance. We also have a guidance, a service. I should say that this is a second pillar of business operation, and I think it is truly worthy of our unique characteristics of our organisation. We manage the resource and also the fisherman’s right to engage in fishing the fishing villages, the fishing grounds, to what extent they should catch. And if they catch all these seaweeds and other marine sources in the fishing ground, then they will not be able to enjoy the fishing in the following years. So to avoid such exhaustion of resources, under the law, there are certain regulations and restraints, and we manage such fishing grounds to create an environment benign for the fishing activities. I believe that this is one of our roles. So resource management has always been an important role and a mission for us.

But on a personal note, we have the SDGs and I think what we have done from the past, the resource grant management, is also relevant in the context of SDGs. We cleaned the coasts and we engaged in programs to prevent and mitigate the marine accidents. And if you look at the role and characteristics, it is familiar. So we provide a very comprehensive service to the fishing industry and the strengths of JF Mutual Insurance is that we understand the members of family structure. We know exactly where they live, where they reside, and how many members in the families. The fishing cooperatives have a profound knowledge about and every members and their state of conditions. They know how much income that they enjoy and they also understand that level of living. So they have a full knowledge about anything that has to do with the fishing so that they can provide a service or coverage tailored to each member’s lifestyle and needs. Now, let me talk about the Voice of Life. As I have said, we celebrated the 70th anniversary in 2021.

We’ll protect the livelihood, the life, and the property of members. We’re always reminding ourselves of that role and we are trying to save the lives of the people living in the coastal and fishing villages. And with that in mind, we decided to publish a booklet which is titled the Voice of Life. This is to protect the lives of our members, and protect them from disasters and accidents. We have had many sad experiences, the disasters and also the accidents in the sea, the tsunami, but listened to the voices of the members about the experience, how they have survived and tried to save their lives. And we are trying to share their experience with the members, so the Voice of Life is the information booklet. So it is a intent to promote the mutual help for helping each other, and I believe that it is the very role of JF, to link the members so that we serve as assistance between those who provide the voice information and those who received the voice. Now, 10 years since the Great East Japan earthquake.

So that was the theme of the booklet and the Great East Japan earthquake, I think many of you remember this earthquake, but we have compiled some facts here. It occurred at 2:46 on March 11th, 2011. Scale was magnitude of 9.0. And in the fishing villages or fishing communities where we live, the height of that tsunami was very big. And in terms of the height in Soma, that’s in Fukushima Prefecture, Soma District, in Soma, it was more than 9.3 majors. Ishinomaki City, Ayukawa, that’s in Miyagi Prefecture, that was more than 8.6 meters. Miyako, that’s Iwate Prefecture, 8.5 meters or higher. And so in Fukushima, Miyagi, Iwate, the tsunami was eight meters or higher. So in these three prefectures, there was massive damage. And the maximum run-up was 40.1 meters, so it did run up to a very big height. A number of death and missing is more than 18,000. And in terms of the damaged buildings, 1.16 million and, of that, complete destruction, 129,000.

And you see the losses for the fishing boat as well as the fishing port, and the total amount of the damages, ¥17,400 billion. Now, after this Great East Japan earthquake, for JF, Kyosuiren too, it was the largest insurance claim of about 24 billion, and there was the insurance for property, about ¥15 billion, and for life insurance, approximately ¥9 billion. So that is ¥24 billion or so in total of insurance claims paid out. Iwate, Miyagi, and Fukushima, these three prefectures, the property insurance was 8,500 policies, and 80% or 7,000 were damaged, and then 4,000 or about half were lost to the tsunami. In other words, completely destroyed. So in the coastal area, the damages were quite great. And for life insurance, the number of victims was approximately 560, and that would be about 2% of the life insurance policy holders. Put another way, 2% was the mortality rate, and you can understand that it was a very big disaster.

Now, from here, I am going to show you some of the articles in the booklet, and this is from Miyagi Prefecture, Shichirigahama District. And we interviewed a member and it was the words steer the boat perpendicular to the tsunami. That might be difficult to understand. The assumption here is that in this area, from before, if a tsunami occurred, if the vessels could go out, it should go offshore. That was what was passed down over the ages. In other words, you can be saved if you evacuate offshore. So at the time of the earthquake, this fisherman was working in front of his vessel, and so he went on the vessel, he boarded the vessel, and went offshore, and that was how he came to give us these words. In other words, you should maneuver the boat perpendicular to the tsunami and climb the waves. It might be difficult to imagine. When a big wave is coming, if the vessel is parallel, then the vessel will be unstable and sink.

So that that doesn’t happen, in order to make it stable, you have to be at right angles to the tsunami, and that would make it relatively stable. So be perpendicular to the tsunami. And on the top of the tsunami, you have to decelerate, you have to reduce speed, otherwise you could be overturned. So you reduce speed and point the bow down. That was the message that he gave us. And secondly, you evacuate offshore. And if you encountered that tsunami, it’s important to head for the deeper waters as much as possible. And the third point is that from a daily basis, you should know the topography of the beach in front of you, and the depths of the water, and the shape of the sea bed, so you can think about course to take when evacuating at sea. In other words, the deeper the water, the height of the tsunami will be lower. If the water is shallow, then the wave height is going to be very big. So that’s why you have to evacuate to the deeper waters.

And the other thing is that fishermen are fishing on a daily basis, so they have a good grasp of the sea bed. What the fishing ground is in deep borders or where it’s shallow and you can’t catch fish. So the fishermen have a good understanding of this and so they say you have to evacuate to deeper waters. So I think this is a message that can be readily understood by the fishermen. Let me introduce another article here. Again, this is from Miyagi Prefecture in an area called Kesennuma, which is relatively north in the prefecture. And it’s a simple message, it says believe and obey the evacuation order, even if it turns out not to be necessary, because if the tsunami hits, then you’re going to lose your life. For a fisherman, a fishing vessel is like family or your child. Many feel that way. And in Japanese culture, your store or your company is like your family or your children. Many people tend to think in that way and for fishermen too, that’s the same. A fishing boat is your family. Many people feel that way.

And so when tsunami hits, you may worry about what’s going to happen to your vessel or think about how to make a living afterwards, but if you are dead, then none of those things will matter, and so the most important thing is human life and that should come first. And I think many events happened and they gained experience, and so the message from the fishing community is that it doesn’t matter if the forecast is wrong, if it’s issued, then you should follow it. It’s a very simple but important message. I introduced two articles and, looking back, we have included a number of Voice of Life. And I would like to now think about this from the perspective of SDGs. The Voice of Life is activities to protect our members and the people living in the fishing communities. And if we think about it, protecting fishing villages and fishing persons, that means it’s a activity to protect people and to protect the culture.

In other words, in Japan, we have food culture, such as sushi and sashimi. That is raw fish. And so this is a very important food culture. By protecting fishing, we can also protect culture. The other thing is tsunami damage and marine casualty prevention. And if there are less marine casualties, then that will contribute to stably managing our mutual aid business. And for our members, to protect our members, we conduct activities as part of CSR but, consequently, it will help stably manage our business. So there is advantage to our own business too. And so through the Voice of Life, we want to attain the sustainable development goals and contribute to their realisation. This Voice of Life, it’s a pamphlet, and I’m showing it to the right. And I think you can easily look at it and pick it up, and now, in this phase, we also have a QR code where you can see this booklet on the website. And sorry to say right now, the page that you can read with the QR code is in Japanese only and, at the moment, it has not been translated into English.

Finally, about our future activities, the voice of life is not just a one-time publication, we are going to publish for five years. The 75th anniversary of JF Mutual Insurance will be 2026, so we want to compile it into a book and to distribute it to the fishing communities all over Japan. This year, that is FY2022, we are taking up the theme of marine accidents, which is a common theme for all fishermen in Japan. That is marine accidents are very dangerous and, therefore, we feel that this is an appropriate theme. We can’t stop natural disasters themselves but we can help protect the lives of fishermen by gathering the knowledge and experience of our members all over Japan. And JF Mutual Insurance is committed to bringing knowledge and experience to fishermen across Japan through our Voice of Life. So rather awkward explanation, but I thank you for your kind attention.

Tsutomu Matsubara (AOA):

Mr. Ochi, thank you so, so much. I’ve been looking into the chat, but so far I have not received any question yet. But Executive Secretary of the AOA office, Ms. Kowada, apparently was trying to speak up. I don’t know whether she’ll be commenting or asking a question, but I would give her an opportunity.

Hiroko Kowada (AOA):

A wonderful presentation, Mr. Ochi. Thank you very much. It was a lot of this year that I heard and I have been explained by Mr. Ochi about this publication, Voice of Life, an excellent initiative. It’s a simple effort, but because it’s simple, others can emulate and do the same. And I think a continuation of such initiatives I think would give a good impact on the future behavior of people who’ll be suffering from disasters. And I hope and pray that such an effort will continue and will expand its networking. So once again, I would like to thank him. But I have one question.

Shinsuke Ochi:

Yes, please.

Hiroko Kowada (AOA):

Conveying, sending in a message, trying to explain, talk to other people is very difficult at times. So in putting together this publication, the Voice of Life, what did you bear in mind, what were some of the resourceful ideas that you tried to apply, and what do you think were the most important message that we should be pointing? And also, are you planning any events relevant to this Voice of Life?

Shinsuke Ochi:

Thank you very much. In preparing or in publishing this booklet, it’s very difficult to listen to the experiences of the fishermen. Picking up, accumulating those voices were a challenge, but it was done so in day-to-day activities. Because we tried to be a good listener in the fishing villages, listening to the voices of the fishermen, and there were people who volunteered to help us, and they said, “We will try to listen and pick up those voices,” because they know the sad consequences of disasters such as tsunami.

This book is little, small, and it’s easy to pick up, easy to carry. It’s not a proper booklet, but we tried to be resourceful and tried to think how it should be designed, put together, so people can carry this. And of course, because of the funding constraints, we are not that rich in terms of financial resources, so within the limited budget, we tried to be as creative as possible, but tried to maximise the information inside of this booklet, and I must note that the fishermen and members go together, and on different occasions, we tried to share this with them, and of course, it was limited, but we’re trying to also involve the public sector. The governments are also in support, therefore, in the future, we would cooperate with the local governments to distribute such information booklet. I think there are ways when you try to be creative and try to promote this.

Hiroko Kowada:

Thank you. Working together with the local governments, the public authority, I think is a good idea. And of course, if you could expand such activities, I believe that they could be multiplied in the future. Thank you.

Graham Clark:

Firstly, I’d like to say a big thank you to AOA for inviting us to speak, and also to Yanai for his kind words. This is a great opportunity, I think, for us all today, and the showing of the video earlier, and Ochi san’s expressions of how Kyosuiren coped with the tsunami in Japan I think are quite an inspiration for us all. And I think for me, it highlights one very important thing, that lives are precious and the resources we have in the ocean are precious. And this is not about something that is unique to Japan, or Indonesia, or Philippines, it’s global. So we are on a global journey together and I think that requires that we work together, we collaborate together, and we share. The video that you’ve just seen, for me, highlights very clearly that in Asia Pacific, where we live, the risk of natural catastrophe is with us every minute of every day. Japan has been at the forefront of both disaster risk reduction and risk improvement, and I think has created models which are world-leading models which can be shared.

At the end of the day, this is about saving lives and building resilience, and that is about the theme, I hope, for today’s presentation. Before I introduce my colleagues, I just want to take a few moments just to give some background to what it is that we do and how we’ve tried to develop, as the company, a different approach to businesses. If we look today at what are the greatest challenges that face us, our children, and our grandchildren, they boil down to two. One is food security. How do we provide enough food on this planet to feed the anticipated 11 and a half billion people by 2050 to avoid starvation? The second issue is climate. Both of these are hugely relevant and I think in this journey today, those two drivers affect every single community, whether those are communities in Asia Pacific, or Japan, or whatever. So on that journey, I think that it’s very important to think about those as we talk about what we share together in the next few minutes.

The next thing I wanted to just talk a little bit about was the changes that are taking place in the way that we view our own business in financial services. We have all been brought up, and trained, and skilled in financial services in a very siloed environment. So we talk about the life insurance, we talk about financial insurance for buildings, for protection, for marine insurance, we talk about banking, we talk about microfinance. In today’s connected world, those silos are breaking down and we need to look at solutions like climate, like food security, not within the silo in which we live, but horizontally across all those silos, because if we want to accelerate change and if we want to accelerate impact, we need to accelerate the pace, and the pace of that means we need to stop thinking in terms of silos. In just looking at what we do as a business, at Asia Affinity, we focus on what we call small community and SME, so these are the businesses that are grassroots, it’s small community businesses, is where we think we can make a difference.

We learnt very early on in our journey, particularly with dealing communities both in Japan and in Southeast Asia, that if we want to build longterm resilience in those communities, and we want to be able to sell the products and services that we deliver, selling a single policy is not enough, you need to have a much more broad value proposition. This means being able to understand what your customer wants. What does the consumer want? If we were to look at the areas in Indonesia, for instance, where we grow seaweed and the farmer has an income of $2 or $4 a day, insurance is way beyond his imagination. It’s not a family priority. Feeding the family, educating the family, paying for medical bills, these are the priorities. So we need a different kind of approach when engaging with those communities. So at Asia Affinity, we look at our communities, or try to very hard, as holistically, and we try to say what value can we offer to those communities beyond just the protection need?

So in our world, in our model, we do three things that we deliver to the communities that we work with. We build them. That is what we are doing with our seaweed initiative in Indonesia, we support a nonprofit foundation that’s building capacity, and we also work with in terms of areas like waste. So number one is building. The second area is the technology that makes it work. So with this, we’re working very well with blockchain solutions and mobile solutions that can accelerate engagement and change. The insurance piece, the protection is delivered both through primary agencies, insurance, and reinsurance, both underwriting and also as an intermediary. So that is our model in what we do and what we look at. Our journey that we wanted to talk to you about today is really looking about how we make change and impact from a sustainability point of view on coastal communities. The coastal community journey is one that started by trying to help a fishing cooperative in North Java in Indonesia, they were using illegal netting, rebalance their value chain.

If we’re going to make a difference today, and begin to address the issues of climate and food security, we need to have an integrated model. This, we call our triple bottom line. We need to be engaged with people, because that affects our social responsibility, and we need to be engaged with planet needs, because otherwise the model is not sustainable. We also firmly believe that this needs to be a for-profit business. So we need to be able to make the farmers more money, we need to be growing, make the business more sustainable, because unless it makes money, it’s not sustainable in the longterm. So that is our journey on this and what has driven our business, our commercial model, in Indonesia. Can we have the next slide, please? Looking in turn at the three elements of this model, the people element of what we do is built around looking at how holistically, at a community level, we make impact. This is not just about reducing poverty, it’s about gender, it’s about creating jobs for young people, it’s about education.

With all of these things, unless you have got an integrated approach, integrated strands in making things work, then it won’t be sustainable in the end of the day, and it has to be equitable from the point of view they need to make more money. If we look at coastal communities in general globally, and this is not just Southeast Asia, they suffer from a dire need of access to liquidity, funding. Funding to help build infrastructure, funding to help build need, particularly with climate change, coastal restoration. So these are big, big issues. So the finance train runs right the way through the need for addressing for our people. The second element of this is what we do for the planet, which is our next slide. The planet need has to be woven and integrated into the strategy of what we are delivering for the people with whom we are targeting. Coastal with increasing temperatures, sea water rises, there is a major issue on not only rebalancing coastal rec communities, but also ensuring that the people who work there can live in a sustainable way.

Seaweed offers a unique opportunity because it creates not only source of revenue and is a source of protein, but is also perhaps one of the great hopes of the planet in terms of decarbonising. Seaweed is the planet’s largest absorber of carbon dioxide, so it has a direct impact on climate. So there are a whole range of these, and these are the real drivers for us in terms of the efforts that we’re making to deliver sustainability at a planet level. These three drivers have all been carefully created not just as a model for Indonesia, but as something that can be accelerated and expanded globally. I’ll touch on this point again later on, but I wanted to finally be able to show what it is that we’re looking at. If we look at the last element and the profit piece, I want to try and put into context what is seaweed. As most of you will know, seaweed is a major ingredient in every form of food processing, as well as cosmetics and pharmaceuticals.

Here in Asia, where 98, 99% of the world’s seaweed is grown, it’s been a business and a commodity that’s been with us for over 2,000 years. In Europe, and America, and South America, it is relatively new. Globally, we’re talking about an industry that today may have a market value of around $15 billion. By 2028, that’s looking to expand to nearly $25 billion. So this is a big growth commodity and it’s probably the fastest growing commodity globally. Of that, it’s all grown in Asia, with China being the largest development market. Other than that, Indonesia and the Philippines. The Indonesian seaweed, the tropical seaweed, accounts for probably 27, 28% of the global market. But in looking at profit, it’s not just about the numbers, it’s about the communities. In Indonesia, rather like Japan surprisingly, there are something close to 260, 270,000 families that are involved in coastal community in seaweed farming alone. Those farmers, many of whom are unbanked or underbanked, account for a huge growth segment.

In Indonesia, with its massive coastlines, less than 20% is cultivated, so we have huge growth potential within that. So our profit is driven not just by the size of the market, but also with what we can do to bring liquidity, and finance, and financial stability to the farmers who are growing the seaweeds. In terms of SDGs, our model is quite simple. In reality, we’re touching for both Sea Green and for MARI, every one of the SDGs, but we’ve picked here four that we believe are real targets for both MARI and Sea Green, our operation. The hunger piece is a huge driver in the sense of being able to work towards the 2050 goal of no hunger. The work environment and gender run particularly clear, climate obviously, in terms of coastal restoration, and also building resilience in the life below water. Just to explain how we started these two businesses and why we’ve done it, our segue into this was working to help with a cooperative that was using illegal netting in Indonesia effectively to rebalance what they were doing.

Having decided that seaweed and aquaculture was a big future for us, we spent a year mapping the end-to-end value chain of the entire seaweed sector in Indonesia. This was a report which my colleague, who will talk in a minute, Dodon, put together over a year, and this looked at and talked to every actor in the value chain, farmer, community, buyer, middlemen, finance. So we got a holistic view of the seaweed industry in Indonesia. And from that, we developed the two companies, MARI, who grows it, and then Sea Green, that provides the technology for those two companies. And our intention in doing this was to rebalance the value chain in Indonesia for seaweed, to try and spread the benefits and redistribute them more evenly across the chain. I’d now like to hand over to my colleague, Dodon, who will tell you more about the details of what our colleagues are doing physically on the ground in Indonesia. Thank you.

Dodon Yamin:

Thank you, Graham san. So yeah, we starting the journey with study, we do the research, we meet every single actor in the supply chains, and we try to identify what the challenge. And from this challenge, we try to offering what the solution we can do for this community. And supply challenge we found in this sector in the civic community, financial, quality, supply chains, and also the technology adoption. So it’s supply challenge in the sector, so after that, we make the design what the comprehensive services we can do for this community. We established MARI Oceans and also the Sea Green. And what do MARI Oceans?

MARI Ocean is the community-based civic farming. We’re running two types of civics, it’s the artisanal, who we working close with the farmer as the contract farming, and that is the large scale will be cooperation with our global partner to adoption the latest technology. We starting our journey from the Sulawesi Island. Sulawesi Island contributed around 60% from the national production, so it’s the biggest production in Indonesia. We starting from the Sulawesi. We cooperation with the partner, with the farmer as the contract farming. In the same time, we also are bringing our technology to the large scale as part the innovation we try to building, increase the production seaweed in Indonesia. So that’s how the MARI Oceans are running in Indonesia. We starting in Indonesia, but we are going to the Southeast Asia in near future. Next slide, please.

So yeah, how the business model looks like. We try to building our own business model, very comprehensive, try to give the solution how we can positive contributed to this sector. The first, when we find recess, we find financial service is one of the issue. Most of the financial just support the trader and the exporter, so we need a vehicle to support the farmer directly. Most of the farmer right now just see as object and we want to building they also are part of the subject, so we’ll be building the cooperative initiative. That’s in the beginning, the cooperative will be support for the financial services and also community development in the community. The second issue is about the quality. That’s why we establish our own actuary from the laboratorium and sea-based sensory. This will provide the superior Sea Green to the farmer and also, with the good year, and also resilience with DCSS.

And after that, another issue about the power managements, that’s why we put our sensor in our sites in Sulawesi. This sensor will be collecting the data and we want to the farmer manage the farm based on the data where we collecting based on the sensor. And the others is what we really needed right now is about the digitalisation of the process business to the trustability. That’s why we are building the Sea Green as part of our business model. And last but not least is about transparency and quality. Right now, price is just every weeks, and this also not good for the farmer because they didn’t know what the price looks like. That’s why we trying to making the longterm contract with buyer so we can secure of the price and more stable price. So that’s how the business model looks like. We try to bringing the comprehensive business model, we try to part of the supply chains, and we want to balance the supply chains with Indonesia. Next slide, please.

So yeah, the business model. And if we can see the three of the main economy of scale of the marine business is about actuary operation. Like I mentioned before, actuary is very crucial to manage the quality. One of the issue seaweed Indonesia is about the quality. We really needed about the archery. We needed the Sea Green who very superior and also resilience about the DCSS. And for your information, the Sea Green still get between Sea Green and the growing side, so this really needed in the near future. And the second is the main cultivation. Most of the farmers still are artisanal and traditional, they still do same technology when the seaweed first time coming to Indonesia, so not too much improvement. That’s why we bringing our technology, we bringing our sensor, collecting around the seven and to eight indicator with the condition in the growing sites. They also provide the analysis about the sensor and the farm, also providing the dedicated support and working close with farmer daily, and asking the farmer what the problem, what the challenge, and what the farmer must do about the situation.

So we want the farmer in future use data to manage the farm. This very crucial also. And last but not least is about the optimise. We see the problem not only in the seedling and also the growing site, but also in the after office. That’s why we established building our own dryer where the dryer is make sure the quality is in the food grid and top quality. That also we adopt from the last technology we have. So that’s for our economy of scale from MARI Oceans. We want to become the supply chain in Indonesia. Mostly in Indonesia, from the farmer until the buyer is around seven until nine actors, so it’s very long term supply chain, so we want more balance. And also, getting from farmer is very lows. They have operated to making fries. Fries also coming from buyer only, and buyer is very strong in the supply chains scheme. Next slide, please. So we have two site model. The first artisanal, where artisanal means we cooperation with farmer.

We has two types farmer, the first is the contract farmer and the second, the partnerships. These two types of farmer. We not only focus about the making money and the profitable, but we want to also working close with the farmer, we want to know, and growing together with the farmer. That’s why we are bringing the additional model in our business model. And also the second is large scale operation. We cooperation with our global partner. We try to building the adoption the latest technology about the large sites and large site also two times more efficient the additional, so it’s another our movement to increase the production in Indonesia. And the other is about sustainability. We not just focus for the planet and also about the people, but also about ecological. It’s the most important thing we use before we starting new site or new business in the civic, we must consider about the ecological situation in the sites. That’s why we try to adopt every single standard from the partner. Next slide, please.

So from all our business model, we just launching the last business is about the MARI Coops. And I can say why we must use coop, because like I say before, the supply chain is very unbalanced. Farmer didn’t has the good bargaining to negotiation about the price. That’s why we want to see the farmer not just as a object, but they’re also a subject in the supply chains. That’s why we bringing the MARI Coops initiative. The second is about the ownership. We want farmer also not see MARI is very big company or others, we want to know what the farmer needed, what the farmer dream, and that’s why we bringing the MARI Coops. And the others is about the transparency. We want to working close with farmer, grow together with farmer, and also making the large impact, so not just the seaweed. So in our design in MARI Coops, we not just farmer our member, but also the women, farmer wives, young generation, and also the servants, of course.

We have several surfaces in our cooperative. It’s about research and training, and also the community development. Also, we has a farm store, financial services. Of course, we has the protection and also the warehouse interpretation. And we also has enabling technology. And this year, we already just established in May this year, and we are as 100 members of this year, and also we are already launching our financial services and protecting products. Next year, we want to growing 5 times, so 500, and we launching our services about the TA, technical assistant, training and also the community and community store. We hope in 2025, we has 2,000 members. I think this based on our training. So also the MARI Coops when become the digital cooperative, that’s why enabling technology, one of the very crucial we needed. That’s why in our business model, in the MARI or MARI Coops, Sea Green position is very crucial and critical. And my colleagues will be explain more detail about the Sea Greens. Fred, time is yours.

Fred Puckle Hobbs:

Thank you Dodon, and thank you to AOA for inviting us here to speak to you all today. So as you have just heard, the operation that we are running in Indonesia requires a number of different things and is trying to solve a number of different problems in a number of different areas. From our perspective at Sea Green, the digital challenge is one that has become significantly easier to solve in recent years, not only because of the penetration of mobile technology across the world and indeed across Indonesia, but also because of the international COVID pandemic. In these years, obviously very difficult years for many and from which we need to build back stronger, but at the same time, we have seen the growth of mobile technology used as a way to bring digital services to communities that are often difficult to reach. And as everyone heard Mr. Clark say earlier, these coastal communities with which we’re working are often heavily unbanked or at least underbanked in terms of service.

Likewise, with the number of layers of aggregation in the seaweed supply chain, at this point it’s clearly easy to see that finance simply isn’t penetrating to the ground level and to the communities which farm seaweed which, as we’ve heard, is such a high potential crop. As you can see from this slide, and indeed is a universal truth across most of the coastal communities in Indonesia, this unbanked component of these groups unfortunately translates into indebted servitude in some degrees to traders and to those in the supply chain that are able to acquire the finance to run their businesses. This means, as I say, that the usual components of financial services that we would all expect day to day in countries like Singapore, Japan, and across Europe and America are simply not approaching these communities in the way that they should. And from our perspective, this is a huge missing link, and indeed this was borne out by the research carried out by my colleague Dodon during the year that we took to analyse the seaweed supply chain.

This translates also into an inability for small scale, small holder seaweed farmers to grow their businesses, which is, again, a huge issue if we want to scale and improve this industry to fulfill its potential in the way that we know is possible. As a result, we created Sea Green on the basis of this research that we did to provide a link between the seaweed value chain, having rebalanced it such that it would be a shorter supply chain which is more efficient and optimised. We wanted to link that structure with the research development and finance available at the international community level to support these farmers directly and to ensure that they are able to do their absolute best of what they choose to do with their livelihoods or what they must do with their livelihoods, which is seaweed farming. From our perspective, this is particularly crucial because we know that the vast majority of seaweed farming, as we’ve heard earlier, is done in Asia.

But unfortunately, at the moment, the overwhelming majority of this research and investment is going to Europe and the States, and indeed other new territories, where seaweed farming is novel and exciting. So what we need to do is to create this linkage between the scientists, and the financiers, and the investors, and the protection providers to the communities that are already doing the seaweed farming, and have that expertise and generational knowledge to be able to do so very, very well. And this, again, is why we created Sea Green. So as an overall model, what the Sea Green platform does is to link the value chain to those top level services through the provision of useful value-add tools to the farmers, which they can access in their hands on their mobile phones, but also through a range of data services, which are of value and provide additional optimisation to not only organisations like MARI Oceans, but also to the buyers and to the providers of finance that are ultimately able to better serve these communities.

Can we have the next side, please? In terms of what this means from a data perspective, we see these platform services as particularly revolutionary, I suppose we should say. If we could have the next slide, please. Sorry that’s back one. Thank you, Raj. So these services, being able to link together the data collected from the front end of the value chain through the mobile phones of the farmers. And the important component here is that this data has not previously existed in the seaweed supply chain. Right now, ultimately the most that is done on the ground level is some simple bookkeeping, but we know from the research that we’ve carried out and from field visits to these farming communities that significantly more can be done if data is collected. And this can range not only from direct environmental data collection but also to farming practice monitoring, disease prevention and mitigation work, and also the social data aggregation that allows us to effectively track impact.

And when we bring this back to a business level, one of the most important components for buyers is the ability to see where their seaweed came from, not only from a traceability perspective but also from a product improvement standpoint. So it is extremely important that we, as an organisation, are able to absorb this data and structure it in such a way that it can be used for the development of the market at the commercial level, the improvement of practices by the farmers and by their communities, but also to translate innovation at the international community level to real applied changes at the community level. And of course, this means being able to use the most modern and effective data tools and technologies to do this, which is why we chose to use blockchain technology. This is often considered revolutionary, as we know, there are types of currencies that use this tech, but for us, we see it chiefly as an enabler for connectivity of ecosystems, breaking down the silos between the data that exist in this kind of value chain, and the financial services that ultimately are going to fund it and to protect it.

So really from a Sea Green perspective, the components you see in the bottom left of the screen feed together and translate together into a unified set of tools that ultimately give us the potential to drive this industry forward into the next decade and into the subsequent years that will allow us to fulfill the potential of seaweed as a crop. Beyond this, however, we’ve also created the platform as multi-use and ultimately re-deployable, not only from a geographical perspective to support seaweed across Southeast Asia, the rest of Asia, and the world, but also to support other commodities. Can we have the next slide, please? In terms of what this means for the farmers on the ground, we are able to see that this interface that we’ve created for the mobile technology could be used not only for seaweed but, as I say, for other types of aquaculture, sometimes in integrated models known as IMTA. That stands for Integrated Multi-Trophic Aquaculture or, for an example, growing seaweed alongside crab, lobsters for the mutual benefit of each of those types of produce.

So we imagine a system in which, let’s say, lobsters are grown directly under the seaweed cultivation lines, and this means the seaweed and the lobster grow better together, and that achieves a second revenue stream for the farmers. And if we’re able to monitor those things together, we can actually begin to start to increase productivity of coastal ecosystems, but also start to think about how we protect the natural capital in these areas. So this means encouraging farmers to treat coral reefs, mangrove forests, sea grass meadows, and other types of natural capital to support the healthy and flourishing ecosystems we know the oceans can be. Beyond this, we can also use the system to support agriculture. So any existing value chain, for example, coffee, or cocoa, or indeed cotton, and we have been approached by other types of commercial buyers beyond the aquaculture space who are interested in this technology. But how does it work for the farmers on the ground? Well, from our research, we understood that farmers knew that they needed traceability but they didn’t fully understand why.

So we provide a traceability engine that connects them to their buyers in terms of their own data. It allows them to store the records and the logs of how they have cultivated their product, and it allows them to show that to the buyers in a value-add method or in a value-add way. This is important because previously traceability had been driven up the value chain, a contractual requirement for producers in a particular company’s supply chain, in order to be able to maintain their business relationships. We see this as a huge problem and this is why our platform is free to download. And in terms of the traceability, it actually allows the farmers to execute, alongside their product journey, the commercial transactions that mean they get paid straight away, which currently, in a cash-based system which requires delays in order for payments to be processed and reconciliations to be achieved, this can all be done at the same time. Effectively, once the final sale is done to the end use buyer, the cash can be immediately dispersed back to the farmers in the form of a digital wallet and currency.

So this facilitates not only the end-to-end best practice and process management from a farming perspective, but also the integration of the commercial transactions that actually link together the two ends of the value chain, thus supporting MARI’s objective of shrinking that chain and making sure that the most efficiency is gained from the production steps. The final and important component here to mention is also the environmental monitoring. This allows us to be able to integrate previously misunderstood or previously not seen environmental data points that directly support the growth of seaweed, and you can see some of those in the top right. That’s actually a picture of the sensor, which my colleague Dodon mentioned earlier, monitoring the chemical water quality in the Bone region of Sulawesi. These variables that you can see directly influence the quality but also the yield of the seaweed that is produced. And in the case of the types of seaweed that we are supporting the cultivation of, this is very, very important for the extract values of those products. So things like carrageenan and agar production at this time.

But as we move into other types of seaweed, we will see how these potentially can be expanded to support the production of other end uses like bio-plastics, bio-fertilisers and other types for which this environmental data is very important. The final reason this is vital is because, as we heard from Mr. Clark earlier, the potential for seaweed to support things like decarbonisation and biodiversity restoration also will enable us, through the collection of data, to incentivise farmers to carry out practice in a certain way. And this is extremely important as we move into this UN decade of action, where we expect the ocean to play a huge role in supporting climate action, but also the other SDGs that we mentioned earlier. Can we have the next slide, please? I can just talk about the revenue model for how Sea Green makes money as a platform. In short, as I mentioned, being a free to download and use platform, the system is commission based or micro transaction based. Ultimately, this means that we can decide where it is that we take a very tiny percentage of the sales carried out over our mobile app and platform.

This means that, in this case for the value chain, where we know that the buyers are dominant in terms of how supply is achieved, we can charge the buyers a very small fee that increases their margins and allows them to actually deal between the different counterparts in the supply chain very effectively, but they’re not paying for it at huge rates and they are being more efficient. If, in a different system, the supplier were potentially the dominant party, we could do the reverse, we could charge the suppliers, but in this case, we know that the farmers are often underbanked, unbanked, and lacking the finance required, and often not paid on time, so we place this charge with the buyer in this case. From a data service perspective, however, the buyers and indeed organisations like MARI Oceans are better able to manage their supply using a monthly subscription to the data that they are able to produce or able to seem be produced by the farmers. We can target these data services across commercial purchases, like the Cargill, or the Nestlé of the world, or the Inner Foods.

And in addition, we can also look at financial services integration, so providing the credit and social risk data to the insurers and to the banks that wish to either protect or finance this work. In terms of how Sea Green will grow in the next few years, we’re targeting an adoption of 20,000 of the seaweed farming families across Indonesia in the next 5 years, which is not a huge percentage of those involved in seaweed cultivation. However, we expect the system to be able to grow significantly further across this vertical, but also into different regional territories and into different types of production supply chains. Indeed, we also hope to be able to add in new types of services and support new emerging technologies through this integration, including digital education and, of course, other types of financial services product. And, in particular, the insurance base, which allows us to provide and integrate the protection products that we know that farmers like those of MARI Oceans and indeed MARI Oceans itself require. And so for that point, I will hand back to Mr. Clark to close us out and talk a little bit more about those protection products.

Graham Clark:

Thank you, Fred. I hope that’s given you a little bit of an idea, an overview of what we’ve created here and what we’re growing as a business. Once you have digitised a process, then there are a number of things that you can do with that data and services that you can access that really are game changers for the community involved. The traceability technology that’s being developed not only allows farmers to see what’s being grown, buyers to see what they’re buying, but it opens up data possibilities. To give you an example, currently seaweed globally is virtually unfinanceable. In Southeast Asia, the financing for seaweed, the way the farmers get their money to buy seed stock to grow seaweed, is provided by the traders. One of the big issues. Now, however, with this platform, we can provide financial institutions, be they microfinance institutions or rural banks, development banks, we can provide them with the tools that make seaweed aquaculture bankable.

In terms of the way that we’ve developed purely the protection element in this, and I thought this would tie up with Ochi san’s explanation right at the beginning about protection and livelihood, we’ve broken what we do down into two parts. The first is to look at the protection levels that we’re delivering to the farmers and their families. This is all done through the app. So for every kilo of seaweed sold, the buyer pays a small price which pays for the protection for the farmer. This covers basically the life cover, accident, and, of course, catastrophe against the big risk of earthquake or tsunami. So all that is bundled into the price, so there’s no transaction, nothing’s paid for by the farmer, they get the cover by being a cooperative member and by using the platform. The second element of this is how we’re looking from a corporate basis at the overall cooperative themselves, and there are two aspects to this. One is what we’re looking at in terms of the protection, the harvesting while it’s growing.

Like Japan, Indonesia is heavily exposed to earthquake risk. The risk for tsunami on this and for earthquake in general is perhaps the biggest risk of all for growing seaweed. So we’re looking to protect this in two ways, one is to do protection on the catastrophe on the physical growing that just pays for major disaster, whether as a parametric product or as straight ground up, depending on the volumes involved. The second is to look at what’s equivalent of a stock throughput policy, which covers the seaweed from the time that it’s harvested through the processing platform and then onto final export. All of this is traded through the platform. To make this more effective, one of the investments that we’ve made in Indonesia on the insurance side is to use blockchain, and our ability to issue or to offer term key policy fulfillment and policy management.

The model that we piloted and the technology that we’ve put in place in Indonesia has the ability to issue full-cycle policy administration for less than $1 US a policy. I’ll say that again, $1 US per policy. The reason for this is because at this level, you need efficient process and efficient systems to be able to support. We’re at the beginning of this journey and I think that there is a lot more, not only accelerating our models, but also in terms of how we can grow. So in terms of the next slide, please, one of the reasons that we’ve structured this presentation as we have done in the way it’s been done is to offer a call to action. If I could have the next slide, please. As I said, at the beginning of this presentation, today we are faced with huge community tasks of addressing food security and climate change. This is not something that one organisation can do on its own.

The cooperative movement has a unique, perhaps the only role, that can really help drive this change process, and so the call I would make today is twofold. Number one, the model that we’ve developed here, and we continue to develop, both the technology, and also the growth model, is available to anybody who wants to work with us. This is not proprietary data on our side, not proprietary models. For us the goal is big. We want to be able to accelerate the model. So if there are any cooperatives out there, members of ICMIF AOA, who are interested, we’re more than happy to share our data with them. Lastly, I’d like to pick up on the point from Ochi san’s great presentation earlier this morning, and that would be his Voices for Life, which I think is the most wonderful concept. The risk of earthquake, tsunami, typhoon, is not something that’s confined to only Japan, all of us in Asia suffer from this.

And I think there are lessons, there are voices in this that need to be heard, not only in Japan, but in the Philippines, in Indonesia, Vietnam, Myanmar, anywhere that’s got vulnerable coastline. So I’d like to offer, from our point of view, a wish to collaborate, to broaden out this concept of Voices for life, because I think it’s hugely relevant for fishing communities anywhere, and I think we could start something here that could take momentum on its own. We’d be very happy to put this into English, into Bahasa Indonesia, or any other language that works, but I’d like to think about how we could do this collaboratively, because I think it’s something we could grow on. So I think there is one more video before we close, but thank you for your time and I hope that’s been of interest and provided some food for thought. Thank you.

[VIDEO]

Asia Affinity is a holding company based in Hong Kong with a solid track record of building, enabling, and protecting community engaged environmental impact SMEs in the region. Its two subsidiaries, Sea Green and MARI Oceans, work across Southeast Asia providing digital infrastructure and governance support respectively to coastal communities. This combined strategy serves to maximize impact and accelerate scale across the blue economy. MARI Ocean’s currently operates in South Sulawesi, Indonesia, where seaweed farming has been established for decades but during which time little has changed in the sector. The organisation leverages cooperative structuring to improve output quality and empower financial resilience in a cyclical model, ensuring that profit is reinvested into the community. Injecting capital supports the implementation of new practices, from quality seed stock management through selection and monitoring of growing sites to optimisation of improved primary processing methodologies.

By enabling transparency, connectivity, and restorative practices, seaweed farmers become part of an equitable circular economy, allowing them to transition from artisanal farming to contracted large scale operations. By 2026, MARI aims to produce over 150,000 tons of fresh seaweed per year and generate revenues in excess of $40 million annually. The Sea Green mobile app supports farmer’s aggregation of detailed environmental, commercial, and traceability data, creating a blockchain-based digital twin of the value chain. Platform infrastructure and APIs make this data available to stakeholders across the supply chain and for the development of new research, processes, and services. This includes not only productivity and logistical optimisation, but also financial services like loans and insurance. The organisation works to ensure that this new value is democratically connected to the participants who need it, from farmers to buyers. With the mobile app free to download, the solution’s front-end services are easily accessible to those who need them most. In turn, a low transparent fee for buyers and access to a range of data tools ensures utility for downstream actors, whatever their motivation.

Within five years, Sea Green will operate across territories and continents, supporting close to 25,000 users and generating over $13 million in revenue each year. Sea Green and MARI Ocean’s combined solution serves to rebalance the fragmented seaweed value chain and unlock the vast potential of the sector. Optimising the links between all actors in the supply chain and enhancing the value of each step in the seaweed production cycle underscores the key value at the heart of our model, collaboration. Enabling the environment for innovation and market development to thrive ensures fairer distribution of the predicted economic growth of the sector projected to flourish alongside other increasing global demand for macroalgae as a commodity. Global recognition of seaweed farming as a sustainable livelihood for coastal communities is growing, with a unique power to transcend the UN Sustainable Development Goals.

Building social foundations by promoting gender equality, household resilience, and diversified income, Sea Green and MARI Oceans seek to work alongside coastal communities to foster sustainable growth. With its vast ecosystem benefits when managed effectively, seaweed cultivation can also restore biodiversity, improve water quality, and has proven ability to contribute to climate mitigation through carbon drawdown. Beyond its immediate environmental impact, seaweed farming, when made a component of an integrated coastal management approach, can be a catalyst for community development. Building this holistic approach within the Asia Affinity group allows for further expansion of connected services, including training and digital education, waste management solutions, and microfinance, further driving coastal community development and opening avenues for new initiatives such as parametric insurance and disaster risk management.

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