Biodiversity finance is not a cost but an investment with a high return

Spending on biodiversity is not a cost but an investment with a high return to sustainable development. The international Economics of Ecosystems and Biodiversity (TEEB) reports indicate that if human kind invests in nature, the return can be as high as 50:1, or more.

This was the overall message by the UN Assistant Secretary General and Executive Secretary of the Convention on Biological Diversity, Dr. Christiana Pasca Palmer, when she addressed a high-level briefing on Biodiversity Finance in Windhoek on 6 August 2018.

The ResMob Project, implemented by the Ministry of Environment and Tourism and the GIZ, arranged the event to expose and update stakeholders in government and state entities with the following objectives:

  • Understanding global financing opportunities for sustainable development and biodiversity,
  • Highlighting the value of nature in Namibia and the need to invest in it, and
  • Facilitating an inter-sectoral discussion on biodiversity finance.

Hon. Pohamba Shifeta, Minister of Environment and Tourism.

The Minister of Environment and Tourism, Hon. Pohamba Shifeta, in his welcoming address said the international 2008 Resource Mobilization Strategy of the Convention on Biological Diversity and Aichi Target 20 both call for the increased mobilization of financial resources for the effective implementation of this important Convention.

Minister Shifeta said the high-level briefing’s importance was to stimulate the broader debate around the costs and benefits of nature conservation and environmental protection in Namibia. “Just as a private sector investor will not invest in something without knowing its likely returns, the Government must also know the value of nature, who is benefiting from it as well as the type of returns it is generating. This is vital to inform our planning and budgeting processes.”

He pointed out that:

  • The value of ecosystem services in Namibia exceeds N$13 billion per year,
  • Total biodiversity expenditure from all sources is slightly more than N$1 billion per year in Namibia, and
  • To fully achieve the targets of Namibia’s Second National Biodiversity Strategy and Action Plan, it is estimated that the country needs to double the level of investment in biodiversity.

“We have also incorporated this call in our own Second National Biodiversity Strategy and Action Plan, and I am pleased that we have been able to conduct considerable work to identify our funding needs, gaps and priorities in the area of biodiversity management.”

Dr. Pasca Palmer in her keynote address strongly acknowledged ‘the salient and continuous actions by the Government of Namibia and the Ministry of Environment and Tourism to position and advance the biodiversity agenda as a contributor to sustainable development’.

The processes and functions that underpins biodiversity, through direct and indirect ecosystem services, support numerous development activities essential for human well-being and economic growth at large. With this comes another significant asset: that of knowledge, capacities, and skills, she said.

She alluded to three opportunities or challenges:

  1. Without biodiversity, its provisions and services there would be no development.

Biodiversity loss and ecosystem collapse are one of humanity’s biggest threats. The World Economic Forum 2018 Risk Report registered this loss among the top 10 global risks in terms of likelihood.Biodiversity underpins ecosystem health but also human and communities’ health. It ensures ecosystem functioning and the provision of ecosystem services which are critical for our well-being, if not survival.She referred to examples such as invasive alien species that are globally key drivers of biodiversity loss and cost. A recent study found that invasive insects alone cause costs of up to US$70 billion per annum. According the IPBES 2016 pollinator study more than three quarters of global food crops rely on animal pollination, including wild pollinators, contributing to 35 percent of the global crop production volume.In Namibia 70 percent of the population is dependent on natural resources for their livelihood, which states the strong link between natural capital and poverty eradication.

Dr. Christiana Pasca Palmer, UN Assistant Secretary General and Executive Secretary of the Convention on Biological Diversity.

She asked how governments will address the growing demands for food that will also increase by 35 percent, water by 40 percent and energy by 50 percent by 2030 in the face of heightened demographic growth?

“How could investing in Namibia’s natural capital provide an opportunity to empower innovate and bring and new jobs to many people, especially in rural communities, while lifting them out of poverty? How can biodiversity add value to economic development plans?”

Dr. Pasca Palmer sketched the enormity of the mobilization of financial resources for biodiversity conservation and sustainable development.

“Broadly speaking, estimates show that the full value of nature to global GDP is between 75 and 125 trillion U$ Dollars. This is aligned with the global GDP itself, accounting to close to 78 trillion U$ Dollars.

For the Strategic Plan for Biodiversity 2011-2020, the global funding needs to achieve the 20 Aichi Targets were assessed in the range of 150 to 440 billion USD annually. This is merely a fraction of global GDP.”

Closing financing or reducing finance gap is critical. Dr. Pasca Palmer said this would require political will and innovative approaches to raise new funds, enhance policy alignment and coherence with the aim of transforming economies, production and consumption towards sustainability.

The established narrative should be changed, economic cases for biodiversity policies should be made and a broader engagement strategy for the various sectors is needed.

“… we need to mainstream biodiversity in public and private policy and decision making, including in public budgets at all levels.”

She lauded Namibia as the first African country to incorporate the protection of the environment in its national constitution, a fundamental step in support of biodiversity mainstreaming. Namibia has also been at the forefront of using economic valuation methodologies for showcasing the benefits generated by ecosystems and biodiversity, including through its work on The Economics of Ecosystems and Biodiversity (TEEB Namibia).

She referred to the mainstreaming of biodiversity into agriculture, forestry, fisheries, water, lands, mining, energy, wildlife; and tourism, identified in Namibia’s Vision 2030 and the five-year National Development Plans (NDP) for poverty alleviation and their links to critical natural capital.

Dr. Pasca Palmer also recognized that Namibia had done work to account for its Natural capital in using the UN System of Environmental-Economic Accounting (SEEA) and is a signatory country of the Gaborone Declaration for Sustainability in Africa – an Africa-led initiative to advance economic valuation and natural capital accounting. She encourages Namibia to call on others, at COP14 ‘to advance and champion work on this critical issue’.

2. Biodiversity finance tools can provide economic opportunities and avenues to increase cost efficiency

Dr. Pasca Palmer contributing to the panel discussion with Minister Shifeta listening on.

Namibia’s work using the BIOFIN methodology, supported by GIZ, is a noteworthy example, she noted. “Your review of biodiversity-related expenditures can provide significant insights for other countries to learn from. A critical part of this is to make more progress on removing perverse incentive policies – in particular publicly funded subsidies – that are harmful for biodiversity.” It is important to eliminate, phase out or reform subsidies that are harmful for and have negative impacts on and reduce negative impacts on biodiversity, as well as lower funding needs for biodiversity policies. At the same time saved public funds could be used for other priorities. Such an alignment of incentive policies is an important component of better policy coherence and would contribute to the more efficient use of financial resources.

“However, even with progress on these elements, public finance alone will not be sufficient to meet the biodiversity challenge. This is why Aichi Biodiversity Target 20 calls for achieving a significant increase in funding from all sources – including innovative and private finance.”

3. We need to partner with the private sector, such as banks, portfolio investment, financial institutions, insurance companies, among others.

Dr. Pasca Palmer said such entities could contribute by reflecting on their biodiversity-related risks in lending decisions and portfolios and establishing ecosystems and biodiversity as an asset class. Progress in this regard can be reviewed via tools developed by UNEP’s Finance Initiative and the Natural Capital Finance Alliance.

Attendees and the media listening attentively to the discussion

“Blended finance arrangements can also be examined to de-risk and catalyze private investments. Such arrangements are more advanced in sectors such as energy or water and sanitation. For biodiversity and ecosystems, we stand at the beginning, and could build on public-private partnerships, to generate opportunities for reducing the biodiversity finance gap and contribute to other policy priorities, like poverty eradication.”

Dr. Pasca Palmer concluded het address by stating:

  1. Spending on biodiversity is not a cost but an investment with a high return to sustainable development.
  2. Biodiversity finance tools can provide economic opportunities and avenues to increase cost efficiency, and
  3. Biodiversity finance needs to be addressed in a more systematic manner, through a “whole of a government” and “whole of society” approach.

NUST Summer School 2018: The Importance of Environmental Services in the Context of the Biodiversity Economy

For the fourth year running NUST and the ResMob Project, an initiative by the Ministry of Environment and Tourism and the GIZ, joined forces to host a course on the assessment and valuation of ecosystem services in the context of the biodiversity economy.

From the 2nd  to 7th of July post-graduate students from NUST and UNAM as well as professionals from the Ministry of Environment and Tourism and selected members of the Environmental Economics Network of Namibia came together in order to get a better insight into ecosystem services, both in theory and practice.

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Ministerial economists & environmental experts equipped with insights and skills on environmental economic tools

About 25 economists and environmental experts from line ministries as well as members of the Environmental Economics Network of Namibia participated in a 3-Day specialist training on methods and examples of the Economics of Ecosystems & Biodiversity (TEEB) Namibia Country Study.

The training was offered by the ResMob Project, an initiative jointly implemented by the Ministry of Environment and Tourism and the GIZ, commissioned by the German Federal Ministry for the Environment, Nature Conservation, Building and nuclear Safety (BMUB). read more…

Biodiversity Economy Planning Workshop developed innovative solutions

Members of the biodiversity economy steering group and selected key stakeholders designed ideas, which could become innovative solutions for further development and implementation in Namibia’s biodiversity-based sectors. They actively participated in a three-day planning training-workshop at River Crossing Lodge, close to Windhoek, from 30 May to 1st June 2018.

The extension of the ResMob Project, with the help of a new component, will directly aim to kick-start the development and implementation of a biodiversity economy in selected landscapes. A biodiversity economy is a landscape-centred green economy approach. It focuses on biodiversity-based sectors, value chains and targets the communities, conservancies and businesses living and active in these landscapes. Therefore, the new component aims at facilitating the prioritisation process (selection of landscapes, sectors and value chains), activating, and involving relevant stakeholder through workshops and baseline studies. (more…)

EENN members and family contribute to the national clean-up campaign

To fully grasp the essential meaning of environmental economics, one occasionally has to grapple with undesirable realities such as pollution, a sore for the eye alongside Namibia’s roads, but also in Windhoek – many a times described as one of the cleanest cities in Southern Africa. 

The EENN did also heed the call of the President of the Republic of Namibia, Dr. Hage Geingob, by participating in the National Clean-up Day. Due to various prior commitments to 25 May, the EENN arranged a clean-up event on 2 June, which took place at the famous Eveline Street in Windhoek.   read more…

Relevant accurate data vital to a Green Economy Framework

Relevant accurate data and statistics are vitally important to a Green Economy Accounting Framework (GEAF) for Namibia. The lack thereof may constrain the design, implementation and evaluation of green growth policies, and even be detrimental to a green economy. Mr Mwala Lubinda, Lecturer in the Department of Agriculture and Natural Resources at the Namibian University of Science and Technology (NUST) addressed the 11th After-work-talk of the Environmental Economics Network of Namibia (EENN) in Windhoek on 23 May, on how a Green Economy Framework could be created for Namibia. He is also a member of the EENN. read more…

Biodiversity Finance Initiative (BIOFIN) 3rd Global Conference held in India, March 2018

Representatives from the Ministry of Environment and Tourism and the GIZ’s Resource Mobilization Project travelled to Mamallapurram, Chennai, in the southern Indian state of Tamil Nadu to attend the UNDP’s 3rd Annual BIOFIN Global Conference from March 6th to 8th. Developed by the UNDP as a methodological framework to facilitate evidence based plans and solutions, BIOFIN seeks to support improved financing of biodiversity initiatives in developing countries. The third BIOFIN global conference saw delegates from over thirty countries — spanning from the Pacific and South East Asia to Sub-Saharan Africa to the Caribbean and Latin America – come together to support south to south dialogue on the challenges and opportunities for financing biodiversity initiatives. read more…

10th EENN After-Work Talk: Incorporating natural capital would put businesses on the way of going green

Going green would certainly pay-off for Namibian businesses if they were to strategically introduce the impacts and dependencies on natural capital into their business models.

Prof. Edeltraud Günther, Director of PRISMA, Centre for Sustainability and Policy at the Technische Universität of Dresden (Technical University of Dresden), delivering her presentation.

Prof. Edeltraud Günther, Director of PRISMA, Centre for Sustainability and Policy at the Technische Universität of Dresden (Technical University of Dresden), addressed the tenth After-Work-Talk of the Environmental Economics Network of Namibia (EENN) in Windhoek on 6 April 2018. About 80 members and other like-minded persons attended the event at the Hotel School of the Namibian University of Science and Technology.

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Focus group preselect and prioritize finance solutions for the National Biodiversity Resource Mobilization Strategy

The Resource Mobilization for Biodiversity Conservation (ResMob) Project conducted an expert focus group meeting in Windhoek on 14 March to utilize the expertise of stakeholders to select and prioritize 10 to 15 finance options for inclusion into the National Biodiversity Resource Mobilization Strategy.

This is a further effort and consultation to involve stakeholders in an interactive and participatory process to develop a National Biodiversity Resource Mobilization strategy.

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MET and the NSA to jointly contribute to environmental economic accounts

The Ministry of Environment and Tourism (MET) entered into a memorandum of understanding (MoU) with the Namibia Statistics Agency (NSA) to jointly produce environmental economic accounts and coordinate the process of natural capital accounting in Namibia.

The Permanent Secretary, Dr. Malan Lindeque, signed the MoU on behalf of the Ministry of Environment and Tourism, and the Statistician General, Mr. Alex Shimuafeni, on behalf of the NSA, at a ceremony on 22 November 2017.

The MoU describes the respective areas of cooperation between MET and the NSA regarding natural capital accounting and related topics at national level. read more…