In the joint report on finance for nature in the G20 countries,United Nations Environment Program (UNEP),The World Economic Forum (WEF), and the Land Degradation Economic Initiative, looked at how rich nations can better support nature-based solutions (NbS).
In addition to promoting sustainable farming and supply chains, or things like creating green spaces in cities to tackle rising heat, the G20 Countries – a grouping representing many economies the world’s most advanced – must address the interconnected crises of climate, biodiversity and land degradation by increasing their annual investment in nature to $285 billion by 2050, State finance for nature in G20 report.
The trillion dollar gap
Release estimates G20 spending, including major emerging economies, at $120 billion in 2020towards official development assistance (ODA).
It notes that the spending gap in non-G20 countries is even larger and harder to close.
The report builds on the 2021 report,’State of Finance for Nature – Triple investment in nature-based solutions by 2030 ‘, calling for closing the NbS $4.1 trillion financing gap between 2020 and 2050.
The results of the report show that only 11%, or $14 billion annually, Private sector investments remain small, although they contribute 60% of the total national GDP in most of the G20 countries.
It also revealed that G20 investments represent 92% of all global NbS investments in 2020.
Enhance soil recovery
Furthermore, 87% – $105 billion – of those investments are allocated internally to domestic programs.
The findings confirm the need to increase investments of a positive nature to close these financing gaps, as reflected inGoal 19 of the Global Biodiversity Frameworkand inGlasgow Climate PactafterwardUnited Nations Conference on Climate Change (COP26) .
The authors also reinforce the need to accelerate land restoration globally, as stated byUN Decade for Ecosystem RestorationYear 2021-2030.
Increase investment
To meet all of the agreed biodiversity, soil restoration and climate targets by 2050, the report emphasizes that the G20 NbS annual investment need must increase by at least 140%.
This means an additional $165 billion a year, especially in ODA and private sector spending.
At the global level, Future investments in nature must quadruple by 2050, equivalent to an annual investment of more than $536 billion..
Since the G20 countries carry out most of the global economic and financial activities with fiscal easing, the report asserts that they have the capacity to achieve that goal.
Need to change the model
State of Finance for Nature also called on G20 Countries to increase investment in non-G20 countries, which can often be more cost-effective and efficient than investing in solutions based on similar nature internally.
There is an urgent need to change the paradigms of governments, corporations and financial institutions to effectively address the interrelated natural, climate and land degradation crises. on which many economies depend.
Ivo Mulder, Head of Department UNEPThe Climate Finance Unit, added that, “systematic changes are needed at all levels, including consumer paying for food, taking into account its environmental impact.”
Achieve targets
The report concludes that after COVID-19crisis, governments must actually build back up for the better.
Since many developed countries can borrow cheaply in international capital markets, the author is calling on policymakers to tie in to natural and climate conditions when providing fiscal stimulus to sectors. in their economy.
This will ensure that international biodiversity, climate and land degradation goals are met.
“Companies and financial institutions should fully disclose financial risks related to climate and nature, and governments need to reuse agricultural and tax fiscal policies,” Mr. Mulder said. trade-related”.
