Beginning with a brief overview, the second edition of the State of Finance for Nature report has recently been released, shedding light on the financial flows and necessary progress within the realm of nature-based solutions (NbS). Released in conjunction, by the UN Environment Programme, Germany’s Federal Ministry for Economic Cooperation and Development’s Economics of Land Degradation initiative, the United Nations Convention to Combat Desertification, and the European Commission, the report provides valuable insight into the state of NbS and their crucial role in climate change, biodiversity, and land degradation.
Key Findings of the Report
The report estimates that current public and private financial flows to NbS equate to USD 154 billion per year. Public funds make up the majority share at 83%, while the private sector contributes the remaining 17%. On a year-on-year basis, total finance flows to NbS have seen an increase of USD 3.9 billion, marking a growth in investment of 2.6% in real terms across the combination of public and private financial flows.
Included Scope of Marine NbS and Protected Areas
In 2022, the report expanded its scope by including marine nature-based solutions and provided a detailed examination of protected area finance. Presently, funding dedicated to marine NbS totals around USD 14 billion or 9% of the overall (terrestrial and marine) total. Government spending in marine NbS exceeds USD 10 billion per annum, which is utilized towards marine protected areas, sustainable management of fisheries, and research and development of fisheries.
Contrasting Nature-Negative Financial Flows
Financial support from the public sector for activities harmful to nature range from USD 500 to 1,100 billion annually. Alarmingly, this figure is three to seven times larger than the current investments in NbS.
Recommended Courses of Action
The report underscored the urgent need to ramp up investments in NbS to USD 384 billion/year by 2025. Without this increase, goals pertaining to climate change, biodiversity, and land degradation will not be achievable. From a private sector perspective, actors must combine ‘net zero’ with ‘nature positive’, promoting sustainable supply chains, reducing activities that harm climate and biodiversity, offsetting unavoidable actions through high-integrity nature markets, and investing in nature-positive activities.
A Push for Greater Inclusion in Financial Systems
The report advocates for a comprehensive approach, urging both public and private sectors to incorporate just transition principles safeguarding human rights. The Just Transition maximizes social and economic opportunities presented by climate action while carefully managing potential challenges.
Understanding Nature-based Solutions (NbS)
NbS refers to the sustainable management and use of nature to address socio-environmental challenges, ranging from climate change and biodiversity loss to food and water security, and even human health. Crucially, NbS support vital ecosystem services, biodiversity, access to fresh water, improved livelihoods, healthy diets, and food security. They are also integral to achieving the goals of the Paris Agreement on Climate Change.
About the United Nations Environment Programme
Established on 5th June 1972, the UNEP is a leading authority on global environmental issues. Its primary functions include setting the global environmental agenda, promoting sustainable development within the United Nations system, and serving as an advocate for global environment protection. The UNEP has launched several major campaigns and reports aimed at safeguarding our planet. The headquarters of the UNEP is located in Nairobi, Kenya.
Given the pivotal role of nature-based solutions in our battle against climate change, the findings and recommendations of the report can serve as a roadmap for enhancing our efforts to preserve our planet for future generations.
