In the framework of the National Environmental Congress (CONAMA 2024) held between December 2 and 5, Ecoacsa organized the technical session on "Emerging financing mechanisms for nature" with the collaboration of the technical team of the CONAMA Foundation.
In the first part of the session, moderated by David Álvarez, executive director of Ecoacsa, Tania López-Piñeiro, deputy director of the Subdirectorate of Terrestrial and Marine Biodiversity at the Ministry for the Ecological Transition and the Demographic Challenge (MITECO), and Claudia González, senior associate at the Green Finance Institute (GFI), participated. They each offered their perspectives on the current context of biodiversity from global, national, and regulatory viewpoints and contributed to a panel discussion on how biodiversity loss is being addressed by governments, the business sector, and the financial sector through agreements, regulation, and a good dose of innovation to develop financing mechanisms and instruments aimed at conservation and restoration.
David Álvarez opened the session by highlighting the alarming annual financing gap of USD 700 billion to halt nature loss and emphasized that, although current financing flows for nature-based solutions (NbS) reach USD 200 billion, this figure needs to almost triple by 2030 to meet existing commitments.
In this context, he recalled that the Kunming-Montreal Global Biodiversity Framework adopted in 2022 sets ambitious targets, with 30% conservation of terrestrial and marine areas and 30% restoration of degraded ecosystems by 2030. To achieve these targets, he advocated for greater private sector involvement, as public and philanthropic funds are insufficient to cover this gap, and highlighted the crucial role of public-private collaboration to combine innovation and regulation in this effort.
Mobilization of financial resources, an unfinished task after COP16
Tania López-Piñeiro, deputy director of the Subdirectorate of Terrestrial and Marine Biodiversity at MITECO, announced that, since the negotiations on the mobilization of financial resources were one of the agreements that did not succeed at the last COP16 on Biodiversity in Cali (Colombia), this discussion is expected to resume in early 2025. She also emphasized the suitability of promoting mixed financing mechanisms (public-private) and the need to invest in nature-based solutions (NbS). She shared Spain’s actions to meet biodiversity commitments, including the mobilization of 550 million euros by 2025 for projects in various countries.
López-Piñeiro emphasized the importance of taxonomy as a tool to direct investments towards sustainable models and mentioned that, in March 2025, EU countries will need to report progress on harmful subsidies for biodiversity. She also highlighted the need for financial mechanisms to accompany new obligations under the Nature Restoration Law, given the absence of a specific financial system.
Investment mechanisms in the natural environment
To conclude this first part, Claudia González, senior associate at the Green Finance Institute, focused her presentation on the mobilization of capital to boost nature-based solutions. She highlighted that the 40% growth in global GDP in recent years has come at the expense of nature and that one of the conclusions from a recent report on the risk analysis faced by the UK financial system due to nature loss shows that potential losses for banks could reach between 4% and 5% of the value of their portfolios. Additionally, she shared the work they are doing to develop natural capital markets and habitat conservation banks, exploring innovative solutions such as water management service markets to prevent flooding.
