This document discusses innovative financial mechanisms (IFMs) for raising $140 billion needed for natural capital and biodiversity conservation. It outlines that traditional forms of financing are insufficient and IFMs can engage the private sector. It examines mechanisms under the Convention on Biological Diversity including payment for ecosystem services, biodiversity offsets, and biodiversity funding through international development and climate change. Generation mechanisms are broken down by scale, timeframe, level, and market criteria. The document concludes that a combination of direct, indirect, market-based, and non-market mechanisms is needed to close the hundreds of billions of dollars in financing shortfall.
2. overview Why are IFMs important? How much do we need? How much are we currently spending? What is the future scale of finance? Conclusions
3. Why are IFMS important? There is currently a shortfall in biodiversity finance Traditional forms of finance (ODA, philanthropy) are often seen as not being able to fill the gap IFMs can engage with the private sector IFMs may internalise the externality of biodiversity loss BUT Political challenges to their implementation What do we mean when we are talking about IFMs?
4. What are the CostsOf Conservation? Global Canopy Programme
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7. What is the Current Scaleof Finance? Global Canopy Programme
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10. IFMs under the cbd Under Decision IX/11B there are six sources of finance for biodiversity Payment for ecosystem services Biodiversity offset mechanisms Environmental fiscal reforms Markets for green products Biodiversity in international development finance Biodiversity in climate change funding
11. Previous studies Gutman (2003) From Goodwill to Payments for Environmental Services Presents 52 financing options Broken down across six sources Public Private not-for-profit Private for-profit Payments for environmental products Payments for environmental services “You may need less money than you think”
12. Previous studies Gutmanand Davidson (2008) A Review of Innovative International Financial Mechanisms for Biodiversity Conservation Prepared for COP 9 of the CBD Presents 61 traditional and innovative financing options Broken down across four categories Government sources Voluntary sources Markets and Businesses International Payments for Ecosystem Services
14. Think PinC Prepared for COP 10 Broken down into three sections: Generation Delivery Institutional Arrangements Presents 18 traditional and innovative mechanisms
16. Generation mechanisms Based on core CBD principles of adequacy, predictability and timeliness Broken down across four criteria Scale: How much? Timeframe: When? Level: At what level? Market: From where?
17. Generation mechanisms Based on core CBD principles of adequacy, predictability and timeliness Broken down across four criteria Scale: How much? Timeframe: When? Level: At what level? Market: From where? Four options: Direct, Indirect, Other, Non Market
18. MARKET criteria Direct mechanisms Generate finance directly from the provision of an ecosystem service or biodiversity Usually local in scale Require strong regulation to scale up Examples Forest carbon market, direct PES mechanisms
19. MARKET criteria Indirect mechanisms Raise finance by tangibly linking the value of biodiversity and ecosystem services to more traditional markets Larger scales are achievable Require some form of demand side regulation Examples Green commodities (FSC, Shade grown coffee) Ecotourism Natural Capital Bonds
28. indirect Non- Market Direct Other Additional Sources What are the new and additional sources of finance?
29. Other Markets for green products Biodiversity in climate change funding Environmental fiscal reforms Biodiversity in international development finance Biodiversity offset mechanisms Payment for ecosystem services
31. Conclusions There is a shortfall in finance of $ hundreds of billions There are a range of mechanisms that are available These mechanisms have different levers to scale up Direct: Regulation Indirect: Demand Other Market: Coordination Non Market: Political will To reach finance at scale we need to use all mechanisms.
32. Thank You For more information visit www.globalcanopy.org Charlie Parker c.parker@globalcanopy.org
Notes de l'éditeur
CBD has a strategy for resource mobiiisationWhere is the money coming from?
USD tens of billions for “BD”USD hundreds of billions for “Natural Capital”Numbers are old….from the 1990’s, not economists….LAC region has some new estimates under UNDP, Andrew BovarnickNot that they are drastically wrong, just that they are not precise and impacts of climate change now must be considered.Big step for CBD and conservationists is to better understand what is needed
USD tens of billions for “BD”USD hundreds of billions for “Natural Capital”Numbers are old….from the 1990’s, not economists….LAC region has some new estimates under UNDP, Andrew BovarnickNot that they are drastically wrong, just that they are not precise and impacts of climate change now must be considered.Big step for CBD and conservationists is to better understand what is needed
Low-end is current momentum (~BAU), high-end requires increased political willCap-and-trade mechanisms not included because difficult to say how much is “new and additional” and goes directly to ecosystem preservationNatural Capital Taxes not included, because we could not do them justice in current accounting (OECD report) and future is difficult due to government capture/earmarking