Donor countries just agreed to double their foreign aid budgets for biodiversity conservation by 2015.
You probably missed that – since there was almost no international media attention at the UN Biodiversity Conference in Hyderabad, India that wrapped up last week. Nevertheless, the agreement is worth about an additional $5-6 billion in foreign aid for conservation between now and 2015. In addition to the increased foreign aid flows, developing countries also agreed to increase their domestic spending on conservation (by an unspecified amount).
To put this agreement in a global context, the same day the deal was struck in India, Greece was effectively shut down by a national transportation strike and there were anti-austerity protests in Athens. For the Europeans, other donor governments, and the developing countries to all agree to increase their investments in conservation in tough economic times indicates that they get just how smart an investment nature is.
(The annual dividend from the planet’s natural capital stock, by the way, has been estimated at about $75 trillion, which is about the same as the world’s cumulative annual GDP.)
What’s the money for? Two years ago, countries agreed to an ambitious set of targets to protect and restore nature by 2020. It’s a long to-do list:
- Cut the rate of natural habitat loss in half;
- Ensure that agriculture, forestry and fisheries are sustainable;
- Remove environmentally-damaging subsidies;
- Increase the amount of terrestrial and marine protected areas;
- Prevent species extinctions;
- Restore ecosystems that provide essential services for people; and
- Protect ecosystems against the impacts of climate change.
The final target was to mobilize sufficient financial resources to implement all of the other targets.
Aye, there’s the rub.
The numbers aren’t super reliable, but the best information out there indicates that developing countries need about $50 billion per year to achieve these targets and that they are spending about $10 billion per year of their own money plus about $5 billion a year in foreign aid receipts, leaving a $35 billion annual gap. So, another few billion a year in foreign aid and domestic spending is important but not sufficient.
So, the real trick is to figure out how to mobilize private capital to meet that shortfall. We don’t have reliable data on those flows globally – suffice it to say they are currently insufficient but there’s huge potential. While the official negotiations were focused on the foreign aid flows, the corridor discussions and “side event” presentations were all about how to drive private sector investment in natural capital. The Nature Conservancy has some great examples worldwide on how to facilitate private sector investment in nature – like our Water Funds work in Latin America, where natural infrastructure provides cost-effective water quality improvements.
The good news is that companies (at least some of them) are getting that investment potential too, as we saw at the Rio Earth Summit back in June. Major corporations are beginning to understand that investing in nature is a cost-effective way to reduce risk, reduce costs, and improve long-term profitability. (Check out which ones and why here.)
The Conference in Hyderabad also had a focus on beaches (ok, technically: marine conservation and island biodiversity), which provided an opportunity to formally establish a new financing vehicle for islands and to launch a report on the status of marine conservation.
The Conservancy and our partners officially launched the Caribbean Biodiversity Fund, the world’s first regional endowment to support multiple national level conservation Trust Funds. The Government of Germany, The Nature Conservancy and the Global Environment Facility (GEF) have already committed US$30 million towards an initial target of US$40 million. In Hyderabad, the government of Germany also signed a financing agreement to deposit the first contribution of 10 million euros. Once the fund is fully capitalized, it will provide US$2 million per year in sustainable financing to eight Caribbean governments for marine conservation, and they in turn have committed to establish national trust funds which will cumulatively generate matching grants of another $2 million per year.
The Nature Conservancy also released new scientific findings indicating that the world is making significant progress creating marine protected areas (MPAs) – one of the 2020 targets. Our analysis indicates that the world is up to 8.3 million km2, or 2.3 percent of the global ocean area, a quadrupling of MPA coverage over the last 10 years. Driving this change is a trend to set up large MPAs in areas far away from people, where conflict with other ocean uses is relatively low. Such apparent success, however, masks some significant failings, which is why we are calling for more attention on areas that best safeguard ecosystem services and better link to delivering social, cultural and economic benefits to people. The BBC covered this news and our findings generated good discussions.
So, some good news on foreign aid budgets and some good investment opportunities await, but there’s still a lot more hard work ahead to address the world’s ecological debt crisis.
(Image: St. Lucia’s Petit Piton. Set up in 2004, this UNESCO World Heritage Site was established to manage the sustainable use and development of both terrestrial and marine resources in the area, providing equitable sharing of ecological resources to a variety of stakeholders. Image Credit: Steve Schill/TNC)