Forests, mangroves, rivers, marine species, jaguars, flamingos, hummingbirds, and many species inhabit our region. From Chilean Antarctica to Baja California, Latin America and the Caribbean are home to the most extraordinary diversity of species and ecosystems on the planet. We are talking about more than 40% of the world’s biodiversity; almost a third of the planet’s freshwater, 26% of mangroves, and 57% of the world’s primary forests. In fact, our region has six of the natural wealthiest countries: Brazil, Colombia, Ecuador, Mexico, Peru, and Venezuela.
Yes, Latin America is mega-diverse and rich in nature, which offers us an enormous opportunity to address climate change and work for the region’s sustainable development. Unfortunately, however, nature is at risk. Did you know that? Human activities, deforestation, and the emission of products and chemicals that damage nature increases the loss of resources and affect almost 40% of the world’s population.
So what can we do?
Biodiversity loss is indeed a threat to the economy and society – half of the world’s GDP depends on nature! But there are positive mechanisms and actions for nature that would help us combat climate change. It’s simple, if we preserve our species, forests, and ecosystems and reverse deforestation and ecosystem destruction, we can reap substantial social, economic, and climate benefits, moving towards a just ecological transition.
How can nature help us?
For one thing, the region’s biodiversity offers us a valuable carbon sequestration resource. For example, our mangroves and forests store more than 100 gigatons of carbon, nearly 10 times what China produces yearly. Expanding and caring for these forests and mangroves would contribute to the 37% of net CO2 reductions required by 2030 to limit global warming to below 2ºC.
Restoring and protecting nature requires rethinking land use for food production and increasing investment in nature-based solutions. Every dollar invested in ecosystem restoration generates up to $30 in economic benefits. Nature-positive transactions could generate $10 billion in business value per year globally – equivalent to Microsoft’s investment in ChatGPT a few days ago – and create an estimated 395 million jobs by 2030.
What do we do at the IDB?
As a multilateral bank, we play a fundamental role since, besides being guarantors, we contribute our experience and knowledge in designing conservation trust funds, support for Nationally Determined Contributions (NDCs), and implementing National Biodiversity Strategies and Action Plans (NBSAPs). We also have an intermediary role between the public and private sectors.
At the Inter-American Development Bank, we continue to support the design of conservation plans and positive mechanisms for nature through three axes:
- We support countries in the implementation of the Global Biodiversity Framework: We are committed to supporting the goals of the climate agenda and biodiversity preservation. We use concessional resources to support countries in integrating biodiversity into government plans, as well as supporting the valuation of nature for financial planning and the design of economic scenarios, for example, by supporting the creation of the natural capital committee in Chile. In addition, partners such as France and the United Kingdom have been instrumental in creating the Natural Capital Lab Program that provides these resources.
- We increased green finance, seeking to integrate nature into operations where it can play a supporting role while continuing to advance the development of our green finance goal, integrating biodiversity dimensions into our operations and projects. We are also reviewing the portfolio of biodiversity loss risks in the region, which will help us take action in the future. In this regard, we are also working with other multilateral banks on defining a positive financing for nature and the methodology to monitor it. As part of our nature mainstreaming work, we co-lead the nature group with other Multilateral Development Banks, working on actions linked to the “Joint Statement on Nature, People, and Planet.”
- We generate innovative financial instruments. For example, we promote tools such as policy-based guarantees to support debt-for-nature conversions to finance conservation and restoration, along with associated policy reforms. We will also continue to support innovative financial initiatives with IDB Invest and IDB Lab, such as sustainability bonds, early-stage financing, natural asset classes, natural asset tokenization, biodiversity habitat banks, biodiversity credits, and digital platforms.
Annual Meeting 2023
From March 15th to 18th, the IDB hosted its Annual Meeting, a prominent platform for dialogue among our Governors, the Ministers of Finance, Economy, Planning, Presidents of Central Banks, or other esteemed authorities from member countries. The event also welcomed representatives from multilateral financial institutions, development organizations, and private banks.
We invite you to watch the session dedicated to biodiversity, where experts deliberated on the importance of biodiversity and natural capital in various ecosystems and countries across Latin America and the Caribbean.
Watch here:
Leave a Reply