Experts discuss funding for biodiversity protection

On May 2, 2024, the Seminar “Finance for biodiversity and ecosystem services: Towards a new financial system for the protection of biodiversity and climate action” was held in the city of Bogotá, jointly organized by the Economic Commission for Latin America and the Caribbean (ECLAC), the Inter-American Development Bank (IDB) and the Ministry of Finance and Public Credit of Colombia (MHCP). The purpose of the meeting was to facilitate a discussion on the importance of the financial system assuming a more active role in the transition to development models that favor improved productivity, greater inclusion and positive effects on nature. This becomes even more relevant in view of the 16th Conference of the Parties (COP 16) of the Convention on Biological Diversity (CBD), to be held in the city of Cali at the end of October of this year.

During the seminar, topics related to financing for the protection of biodiversity were presented and discussed, with particular emphasis on the current demand for investment mechanisms that leverage the implementation of Nature-Based Solutions, as well as the potential of innovative financial mechanisms to obtain this financing and the enabling conditions for these to be scaled up.

The opening was led by the Minister of Finance and Public Credit, Ricardo Bonilla, and included interventions by the IDB Representative in Colombia, Ramiro López-Ghio, and the Deputy Director General of Prospective and Development of the National Planning Department (DNP), Mario Alejandro Valencia, who joined in the welcome offered to the attendees by the Minister and presented a brief context of the challenges and opportunities that exist in the country and the region to advance the green finance agenda.

The Vice Minister of Environmental Policies and Standardization of the Ministry of Environment and Sustainable Development of Colombia, Mauricio Cabrera, presented the generalities of the Kunming-Montreal Global Biodiversity Framework, as well as the new developments in the update of the country’s Biodiversity Action Plan (NBSAP). ECLAC also presented critical elements of the connection between climate financing and biodiversity with the help of the Head of the Climate Change Economics Unit of the Sustainable Development and Human Settlements Division, Santiago Lorenzo. A panel was held around these topics, made up of directors of public entities from the financial sector and investors from the private sector, who gave their opinions on the challenges, opportunities and current demand for investment mechanisms in Nature-Based Solutions.

The agenda then focused on innovative financial mechanisms that allow for an accelerated increase in the mobilization of resources in favor of biodiversity, and began with a presentation on the lessons learned in this type of mechanisms that Fondo Acción has developed in more than 20 years of experience investing in sustainable projects in favor of the environment and children in Colombia. Next, attendees attended a second panel, in which leaders and specialists from the MHCP, IDB and private sector organizations gave their impressions on the potential of mechanisms such as debt-for-nature conversion, results-based incentives and combined financing. blended financeamong others, and what are the enabling conditions for scaling them.

In closing, the Director of the ECLAC Office in Colombia, Angela Penagos, gathered some of the most relevant ideas and reflections presented during the event, which emphasized the need to carry out a deep reflection on the role that private and development banks should take to promote and scale up the appropriate mechanisms and instruments to preserve biodiversity and the ecosystems that support it.