The Biodiversity Finance Initiative (BIOFIN)
Available evidence and the decisions adopted by Parties to the Convention on Biological Diversity (CBD) indicate that a significant gap remains in finance for biodiversity management, for countries to drastically scale up their efforts and achieve the 20 Aichi Targets defined in the CBD’s Strategic Plan for 2011-2020. A preliminary assessment recently conducted under the auspices of the High-level Panel on Global Assessment of Resources for Implementing the CBD Strategic Plan estimated that the global investment required ranges between 130 and 440 billion US$ annually. While useful, this and similar other global estimates are based on extrapolations sensitive to the underlying assumptions. To define biodiversity finance needs and gaps with greater precision and determine related challenges and opportunities for resource mobilisation, detailed national-level (bottom-up) assessments are therefore required.
In this context, UNDP in October 2012 launched the Biodiversity Finance Initiative – BIOFIN, as a new global partnership seeking to address the biodiversity finance challenge in a comprehensive manner – building a sound business case for increased investment in the management of ecosystems and biodiversity.
BIOFIN is managed by the UNDP Ecosystems and Biodiversity Programme, in partnership with the European Union and the Governments of Germany and Switzerland, who support the initiative with a total of USD 15 million (as of May 2014 – further support is being sought). The Global Environment Facility is a further partner financing parallel in-country projects in support of the revision of National Biodiversity Strategies and Action Plans (NBSAPs).
Guided by a steering committee representing the partners, BIOFIN works along two main axes:
1. Globally-led development of a new methodological framework
An entirely new methodological framework is being developed and piloted for undertaking national-level “bottom-up” analyses of the finance-relevant enabling context; for determining the current / baseline investment in biodiversity; for quantifying the full cost of meeting national biodiversity conservation targets and the resulting finance gap; and for assessing the suitability of financial mechanisms and developing national resource mobilisation strategies that are fully appropriated by national governments and other key in-country stakeholders. The methodologies applied in the project will be refined through regional and global learning, and made available more widely.
2. Adaptation and implementation of this new methodological framework at national level
To help countries increase the importance attributed to biodiversity and in consequence bridge the financing gap, the work at national level will be led by Ministries of Finance, Economics or Planning and the Ministry of Environment. It is articulated through the following components:
a. Analyse the integration of biodiversity and ecosystem services in sectoral and development policy, planning and budgeting
Participating countries will analyse the current policy and institutional frameworks affecting biodiversity and ecosystem services both positively and negatively, and quantify related investments through comprehensive reviews of past and current (baseline) public and private expenditures. Analyses of impact, effectiveness and coherence will provide key opportunities for mainstreaming, aimed at reducing the cost of biodiversity management, such as through the removal of perverse incentives.
b. Assess future financing flows, needs and gaps for managing and conserving biodiversity and ecosystem services
Participating countries will project anticipated future investment in biodiversity, and determine the financing needed to meet agreed national priorities reflecting the CBD Aichi Targets, building on and interacting with the NBSAP process, and taking into account cost-effectiveness and the effects of an improved enabling environment. The difference between the projected future investment and the required investment will enable the quantification of the finance gap.
c. Develop comprehensive national Resource Mobilisation Strategies to meet the biodiversity finance gap
Following an assessment of the full range of potential financing mechanisms (traditional and innovative, national and international), each participating country will develop a strategy to address the finance gap, combining suitable and nationally-adapted mechanisms. The strategy will analyse opportunities, risks and barriers related to the implementation of these mechanisms and provide solutions and recommendations, including on the enabling environment and safeguards.
d. Initiate implementation of the Resource Mobilisation Strategy at national level
Countries will begin implementing recommendations pertaining to a priority subset of the identified financing mechanisms – regarding aspects such as institutional requirements, laws and regulations, taxes and fees, identification of legal thresholds, removal of perverse incentives, further feasibility studies and implementation plans, certification processes, public-private-partnerships, voluntary agreements, etc.
As of May 2014, the following 19 countries participate in BIOFIN: Botswana, Chile, Colombia, Costa Rica, Ecuador, Fiji, Guatemala, India, Indonesia, Kazakhstan, Malaysia, Mexico, Peru, Philippines, Seychelles, South Africa, Thailand, Uganda and Zambia. Further countries can be supported as additional resources are leveraged.