Governments currently provide around 83% of nature-based funding. However, this amount is unlikely to reach the necessary levels due to budgetary challenges related to conflicts in Europe, inflation, debt and poverty faced by many countries.
The Nature Funding Status report comes against the backdrop of what has been described as a biodiversity crisis. The Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services has warned of a planet that is rapidly deteriorating due to human activity, saying “1 million plant and animal species are now threatened with extinction”.
One area where improved financing for nature-based solutions can have a significant impact is in the agriculture and commodity sectors, where large-scale production of food and non-food products often requires the conversion of huge expanses of forest land into farms, resulting in biodiversity and habitat loss for species.
By funding more sustainable agricultural practices that decouple the production of raw materials and deforestation, biodiversity loss would be significantly reduced. The financial sector can play a vital role in supporting solutions that allow farmers to switch to more sustainable farming practices.
Through dedicated funds and facilities, UNEP is supporting a shift in measures and financial flows to reduce consumers’ footprints on forests while helping partners and Member States in deforestation-prone landscapes to adopt practices with less impact on forests. Here is an overview of these approaches:
1. The Responsible Raw Materials Facility
Ease is an initiative to promote the production and trade of responsible soy and corn in Brazil. It does this by creating a financially sustainable vehicle to provide incentives to farmers and help meet the growing international demand for zero deforestation supply chains.
The facility offers favorable financing terms to incentivize farmers in the Cerrado region of Brazil to switch to soy production practices without deforestation or conversion to improve biodiversity.
The facility recently attracted more than $11 million in investment from major supermarkets Tesco, Sainsbury’s and Waitrose in the UK to provide financial incentives to farmers who pledge to produce crops without deforestation or conversion.
2. The Restoration Seed Capital Facility
Implemented by UNEP and the Frankfurt School of Finance and Management and supported by Germany and Luxembourg, this is a unique initiative that promotes private investment in forest restoration.
Ease does so by providing seed funding and project development funding for forest restoration and sustainable land use projects with the aim of promoting private investment in sustainable land use activities.
The facility supports projects in Central and South America and Africa. Through their operations, the installation partners aim to restore at least 40,000 ha of land and protect 500,000 ha of threatened ecosystems.
3. AGRI3 Fund
The AGRI3 Fund aims to mobilize $1 billion in public and private capital worldwide to improve sustainable agricultural value chains, avoid deforestation and improve biodiversity by providing commercial banks with loan guarantees. Financial support goes to agriculture projects that actively prevent deforestation, boost reforestation, and improve rural livelihoods by increasing incomes, building the skills of farmers and smallholders, and improving opportunities for women in agriculture. and forestry.
About the UN Biodiversity Conference (COP15)
From December 7-19 in Montreal, Canada, 196 governments will come together to reach a historic agreement to guide global action on biodiversity. The framework should present an ambitious plan that tackles the main drivers of nature loss and sets us on a path to halt and reverse nature loss by 2030.