CALI, Colombia, Oct 29, CMC – The Inter-American Development Bank (IDB) says together with IDB Invest, they have approved more than two billion US dollars in nature finance in 2023.
IDB Executive Vice President, Jordan Schwartz, speaking at the ongoing United Nations Biodiversity Conference (COP16), said the funding is nearly 13 per cent of total approvals, with more than half meeting the higher standard of nature-positive financing.
The amount includes US$1,33 billion for the public sector and US$765 million for the private sector.
The IDB said it reflects a series of reforms and innovative approaches towards mainstreaming biodiversity into IDB’s and IDB Invest’s structure, operational work, knowledge, and policies aiming to support countries in Latin America and the Caribbean to conserve and restore biodiversity and meet their biodiversity commitments and targets, including tracking and reporting nature finance.
For the first time, the IDB and IDB Invest have piloted tracking nature finance using its green finance principles and the Common Principles agreed by Multilateral Development Banks (MDBs) to implement the MDB Joint Statement on Nature, People and Planet and support Kunmong-Montreal Global Biodiversity Framework targets adopted by the convention on Biological Diversity in 2022 (COP15).
“Conserving and restoring biodiversity is one of the most critical development challenges of our era now that the climate crisis and the loss of biodiversity are intertwined,” said Schwartz,’ adding “this achievement is the result of a long-term commitment to mainstreaming biodiversity and scale our impact”.
He said the Global Biodiversity Framework called for transforming the international financial architecture to help reach the framework’s targets.
“To do that, MDBs are working together in unprecedented ways to protect and mainstream biodiversity,” Schwartz added.
During the session, leaders discussed progress in reaching Target 19 of the Global Biodiversity Framework, which seeks to mobilize US$200 billion per year for biodiversity from all sources, including US$30 billion through international finance.
IDB said Latin America and the Caribbean is a nature powerhouse, home to 40 per cent of the planet’s biodiversity, and can be part of the solution to biodiversity loss. It said an estimated 20 per cent of the region’s jobs depend heavily on ecosystem services, and approximately 12 per cent of the region’s economic value comes from sectors highly dependent on nature.
The IDB has led the Joint Statement on Nature in Glasgow and worked closely with the European Investment Bank (EIB), World Bank, and others to establishing the common principles to track nature-related finance.
As chair of the MDB Heads Group, the IDB has proposed with EIB a joint MDB stock take of key perfomance indicators (KPIs) for biodiversity to scale up nature financing. The first stock-take workshop was held at COP16, and the results will be announced next year by COP30 in Brazil.
Internally, IDB’s new institutional strategy, IDBImpact+, includes for the first time biodiversity among its focus areas for mainstreaming and direct investment.
The IDB said it is also implementing an action plan with specific metrics focused on mainstreaming biodiversity and natural capital and is creating a unit dedicated to biodiversity in its structure, recently approved by its Board of Directors.
On nature-positive investment, the IDB has been boosting innovative finance through nature-based solutions policy guides, and instruments such as sustainability-linked bonds, biodiversity credits, and debt-for-nature conversions, generating significant funds for conservation without increasing national debt.
In one year, IDB’s holistic programme Amazonia Forever project portfolio has evolved from one billion to US$4.2 billion distributed in 191 projects.
The programme also counts on a dedicated unit within IDB’s structure to better serve the Amazonian countries and works closely with the Amazon Treaty Cooperation Organization (ACTO), civil society, Indigenous Peoples and local communities, and the private sector, looking for scaling up financing, coordination and collaboration, and sharing knowledge.
The Green Coalition, for example, comprises 20 public development banks and is committed to mobilizing resources between US$10 billion andUS$20 billion by 2030 to provide greater access to and scale investments in sustainable economic activities.
The IDB Lab, the innovation and venture capital arm of the IDB, has an active green portfolio of 216 operations under management, with a total budget of US$205 million. Currently, IDB Lab works with more than 145 company builders, incubators, NGOs, and innovators across the region with a focus on climate and nature.
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