Categories: Biodiversity Article 6

Financing Biodiversity Conservation

Rob Lake*
Royal Society for the Protection of Birds, Sandy, UK
*Corresponding author (current contact: rob.lake@authenticinvestor.org)

EPL, Vol.27, Iss.3, pp.172-197, 1997



In 1992 the world's leaders committed themselves to an ambitious programme of action for sustainable development, encapsulated in Agenda 21, the Rio Declaration on Environment and Development, a Statement of Forest Principles - all non-binding - and two binding multilateral environmental agreements, on biological diversity and climate change. The main objective for developed countries approaching the United Nations Conference on Environment and Development was new action to protect the global environment. For developing countries, international action to accelerate development - including reform of trading arrangements, debt relief and increased aid - were at the top of the agenda. The North got its new environmental agreements. The South saw its demands for fundamental restructuring of the international economic order largely ignored. But at the heart of the 'Rio bargain' were undertakings by developed countries to provide 'new and additional' resources to enable the South to implement the new agreements. Five years on from UNCED it is time to take stock. Heads of State and Heads of Government will meet in New York from 23 to 26 June for a United Nations General Assembly Special Session (UNGASS - popularly referred to as 'Earth Summit II') to review progress in implementing the Rio agreements and chart directions for the future. The fact that President Clinton and the UK's new Prime Minister Tony Blair have announced that they will attend the summit illustrates the political importance that is being attached to the event. The commitment of the international community to breathing new life into the quest for environmentally sustainable development will be on trial at UNGASS. Conservation and sustainable use of biodiversity are at the heart of sustainable development (as the Biodiversity Convention Secretariat has argued forcefully in its submission to the recent Commission on Sustainable Development (CSD) meeting that was preparing the ground for UNGASS). It is therefore essential for biodiversity that UNGASS should send the right political signals, backed up by specific actions.

Preparations for Earth Summit II
Preparations for the June summit have been conducted at the Intersessional Ad Hoc Working Group of the CSD in FebruarylMarch and the Fifth Session of the CSD itself in April (CSDS). (See report on page 168.) Just as at Rio five years ago, financial issues were at the heart of debate at CSDS. The developed countries have been pushing forward new global environmental initiatives - on freshwater and energy efficiency, for example - while acknowledging that levels of official development assistance (ODA) have fallen since Rio and are unlikely to rise in the future, but arguing that the sharp rise in private foreign investment since UNCED points the way for future financing of sustainable development. The South, meanwhile, is pointing out that the North has simply not fulfilled its Rio commitment to provide new and additional resources, and that UNGASS must produce credible new financial commitments, preferably with targets and timetables for meeting them, at the same time as insisting that all sections of the negotiated text referring to new environmental initiatives stress the need for new resources.

Implications for biodiversity
The draft Proposed Outcome of the Special Session does state that 'there is an urgent need for governments and the international community . . . to take decisive action to conserve and maintain genes, species and ecosystems with the view to promoting sustainable management of biological diversity.' But the failure so far to reach agreement, or even to discuss in a meaningful way, crucial issues relating to both the quantity and quality of international finance for the environment in developing countries has serious adverse implications for biodiversity conservation. These are discussed further below.

Finance for biodiversity in developing countries: quantity and quality

Many of the countries with the richest biodiversity are amongst the poorest in the world. They will continue to require international financial assistance if they are to secure the conservation and sustainable use of biodiversity. Although it is extremely difficult to estimate either the amount of funding required by developing countries or the levels of aid for biodiversity currently being provided by donors, it is clear that substantial additional sums are required. Official development assistance (ODA) budgets in all donor countries are under pressure. Most developed countries are seeking to cut public spending to reduce budget deficits - a need that is particularly acute for European Union countries aiming to meet the criteria for European Economic and Monetary Union. Moreover, doubts have arisen in the public mind - and amongst donors - as to the effectiveness and value of aid. Continuing abject poverty in many countries, misappropriation of aid by corrupt leaders, reduced enthusiasm for international cooperation and changing geopolitical priorities following the end of the Cold War are some of the factors prompting a re-evaluation. All this is im-plicitly recognised by the Proposed Outcome of the Special Session, which argues that 'strategies should be worked out for increasing donor support to aid programmes...'

Against this backdrop a strong case needs to be made - and can legitimately be made - for aid for biodiversity. Conservation of biodiversity will not - in most cases - be secured by the free operation of the market. Intervention is required - e.g. through the establishment of protected areas, use of economic instruments, and encouragement of appropriate social institutions (for example for community forest management). It is to precisely such non-market objectives that aid should be targeted. Aid for biodiversity can yield benefits to people in both developing and developed countries. Long-term sustainability of natural resource use for people in rural areas whose livelihoods depend directly on these resources can help to alleviate poverty. In developed countries, meanwhile, conservation of wildlife, and protection of the environment more generally, continues to command strong support amongst the tax-paying and voting public.

Quality of aid for biodiversity
Maintaining and increasing the quantity of aid for biodiversity must go hand-in-hand with efforts to improve its quality. Important issues here include ensuring that aid adequately addresses top conservation priorities; responding to the need for long-term financial sustainability for biodiversity activities through mechanisms such as national environmental funds and endowments; providing appropriate support to communitylevel institution-building; and integrating biodiversity concerns comprehensively into all aspects of national development policy. The Proposed Outcome text does not deal with any of these substantive issues, making only a passing reference to the need for 'intensified efforts...to reverse [the downward trend in ODA]...taking into account the need for improving the quality and effectiveness of ODA' (emphasis added). While the CSD and UNGASS are not appropriate fora for the detailed debate on these issues that is needed, clearer political signals from world leaders on the nature of the quality improvements that are necessary could greatly assist biodiversity conservation.

Particular attention needs to be given here to the relationship between biodiversity-related activities and poverty alleviation. As noted above, conservation and sustainable use of biodiversity go hand-in-hand with meeting the long-term livelihood needs of people dependent on natural resources, and with enhancing their economic opportunities and welfare. Nonetheless, preparations for UNGASS have shown that 'development' and 'the environment' are still often seen as antagonistic. Developing countries will strongly resist any suggestion that aid for 'the environment' should be at the expense of aid for 'development', or the imposition of 'green conditionality'. Efforts in donor countries to build public support for aid by highlighting the environmental benefits of aid will need to be carefully balanced with greater efforts to maximise the synergy between conservation and development on the ground, and to increase understanding of these links in both developed and developing countries.

The private sector and biodiversity

In the preparations for UNGASS developed countries have repeatedly pointed out that foreign private investment in at least some developing countries now greatly exceeds aid flows, and that this will continue to be the case. Developing countries have countered by highlighting that the bulk of private investment goes to a handful of countries, hardly any of them amongst the poorest. 8 Moreover, private investment - driven by market imperatives - tends to flow to activities that may pose serious threats to biodiversity, such as oil or mineral extraction, forestry, or intensive agriculture and horticulture. Clearly there is an urgent need to ensure that more countries can benefit from foreign private investment, and that this investment is managed in ways that are environmentally (and socially) sustainable. Concerns have been expressed, for example, that the Multilateral Agreement on Investment now being negotiated within the OECD may create incentives for countries to lower environmental standards in order to attract investment, while failing to require transnational corporations to apply the highest possible environmental standards to all their operations, wherever they may be. UNGASS should indicate clearly that growth in private investment must be accompanied by strengthened environmental legislation and policy - and capacity to enforce them - as well as safeguards to ensure that environmental standards are consistently high throughout a company's operations.

A number of initiatives are now under way to develop ways of incorporating biodiversity into companies' environmental management systems, and to involve the private sector in funding biodiversity conservation. This involvement may take the form of biodiversity conservation at a company's operating sites, attention to biodiversity in supply chains (for example reviewing the impacts of pesticides used in the production of crops for supermarkets), or directly funding nongovernmental conservation organisations. High-level political recognition for such endeavours at UNGASS would help to increase awareness of the opportunities that this kind of collaboration offers for biodiversity conservation.

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