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1、State of Financefor NatureThe Big Nature Turnaround Repurposing$7 trillion to combat nature loss2023 2023 United Nations Environment Programme ISBN:978-92-807-4108-7 This publication may be reproduced in whole or in part and in any form for educational or non-profit services without special permissi

2、on from the copyright holder,provided acknowledgement of the source is made.The United Nations Environment Programme would appreciate receiving a copy of any publication that uses this publication as a source.No use of this publication may be made for resale or any other commercial purpose whatsoeve

3、r without prior permission in writing from the United Nations Environment Programme.Applicationsfor such permission,with a statement of the purpose and extent of the reproduction,should be addressed to unep-communication-directorun.org.DisclaimersThe designations employed and the presentation of the

4、 material in this publication do not imply the expression of any opinion whatsoever on the part of the Secretariat of the United Nations concerning the legal status of any country,territory or city or area or its authorities,or concerning the delimitation of its frontiers or boundaries.Mention of a

5、commercial company or product in this document does not imply endorsement by the United Nations Environment Programme or the authors.The use of information from this document for publicity or advertising is not permitted.Trademark names and symbols are used in an editorial fashion with no intention

6、on infringement of trademark or copyright laws.The views expressed in this publication are those of the authors and do not necessarily reflect the views of the United Nations Environment Programme.We regret any errors or omissions that may have been unwittingly made.Maps,photos and illustrations as

7、specified Suggested citation:United Nations Environment Programme(2023).State of Finance for Nature:The Big Nature Turnaround Repurposing$7 trillion to combat nature loss.Nairobi.https:/doi.org/10.59117/20.500.11822/44278Production:Nairobi,KenyaURL:https:/www.unep.org/resources/state-finance-nature-

8、2023iiiAuthorsUnited Nations Environment Programme Nathalie Olsen,Ivo Mulder,Qian Hang,Giorgia Maria Malandrino,Aurelia BlinGlobal CanopyAndrew Mitchell,Pei Chi WongThe Economics of Land Degradation InitiativeWaltraud Ederer,Nina BisomWith technical guidance from the SFN Technical Advisory GroupAndr

9、ew Deutz(The Nature Conservancy),Courtney Lowrance(Citi),Giulia Carbone(WBCSD),Juliano Assuno(Climate Policy Initiative),Onno Van den Heuvel(UNDP Biofin),Padraig Oliver(UNFCCC),Snorre Gjerde(Norway Sovereign Wealth Fund)With data collection,analysis and modelling by Vivid Economics by McKinseyAshley

10、 Gorst,Juliette Perche,Jason Eis,Deven Azevedo,Deepika SehdevWith thanks for review and feedback fromAeree Kim(UNEP),Arindam Jana(UNEP),Baris Karapinar(UNEP),Caroline King-Okumu(UNEP WCMC),Claire Potdevin(UNEP),Dianna Kopansky(UNEP),Gabriela Prata Dias(UNEP),Georgia Savvidou(Chalmers University of T

11、echnology),Gonzalo Oviedo(Independent Consultant),Himanshu Sharma(UNEP),Jessica Smith(UNEP),Johannes Kruse(GIZ),Jonathan Gheyssens(UNEP),Lera Miles(UNEP-WCMC),Marisol Estrella(UNEP),Martin Halle(UNEP),Mirey Atallah(UNEP),Raphaele Deau(UNEP),Romie Goedicke(UNEP),Ruth Do Coutto(UNEP),Sharon Gil(UNEP)G

12、raphic DesignOneStop.SwissDisclaimerThe authors would like to thank the technical advisory group members,webinar participants and reviewers for their valuable contributions.However,the content and the positions expressed are those of the authors and do not necessarily reflect the perspectives of tho

13、se who provided input nor of the organisations to which they are affiliated.Acknowledgments|Cover Photo by Steve Douglas on unsplash-Illustration by Margot SteinerWith financial support from:In support of:vGlossaryShort scale billion a thousand million(1,000,000,000 which is 109)The variability amon

14、g living organisms from all sources including,inter alia,terrestrial,marine and other aquatic ecosystems and the ecological complexes of which they are part;this includes diversity within species,between species and of ecosystems(United Nations Convention on Biological Diversity UNCBD).Measurable co

15、nservation outcomes that result from actions designed to compensate for significant residual biodiversity loss that arise through development projects(Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services IPBES).An asset created through investments in the restoration,conse

16、rvation and development of biodiversity in a specific landscape(United Nations Development Programme UNDP).Expenditure used to purchase and create assets that generate services for more than one year.Involves the practical application of three principles:no or minimum mechanical soil disturbance,bio

17、mass mulch soil cover and crop species diversification,as well as the complementary agricultural practices of integrated crop and production management(Kassam et al.2018).Environmental non-governmental organisationThe difference between current financial flows and future investment needs to achieve

18、climate,biodiversity and land degradation neutrality targets.Annual capital and operating expenditureThe worlds stocks of natural assets,which include geology,soil,air,water and all living things.It is from natural capital that humans derive a wide range of services,often called“ecosystem services”,

19、which make human life possible(UNCBD).All the existing systems created at the same time as the Earth,all the features,forces and processes,such as the weather,the sea and mountains(UNCBD).Actions to protect,conserve,restore,sustainably use and manage natural or modified terrestrial,freshwater,coasta

20、l and marine ecosystems,which address social,economic and environmental challenges effectively and adaptively,while simultaneously providing human well-being,ecosystem services and resilience and biodiversity benefits(United Nations Environment Assembly UNEA).Nature-negative financial flows refer to

21、 finance flows for activities that could potentially have a negative effect on nature (Deutz et al.2020).BiodiversityBiodiversity offsetBiodiversity creditBillionCapital expenditure(investments)Conservation agricultureeNGOFinance gapFinance flowsNatural capitalNatureNature-based solutions(NbS)Nature

22、-harming/negative finance flowsviA high-level goal and concept describing a future state of nature(e.g.biodiversity,ecosystem services and natural capital)that is greater than the current state.Potential threats posed to an organisation linked to its and other organisations dependencies on nature an

23、d nature impacts.These can derive from physical,transitional and systemic risks.Climate Disclosure Standards Board(CDSB;2021)Framework application guidance for biodiversity-related disclosures;The Taskforce on Climate-Related Financial Disclosures(TCFD;2017)Final report:recommendations on climate-re

24、lated financial disclosuresAstate in which the greenhouse gases going into the atmosphere are balanced by removal from the atmosphere.A protected area is a clearly defined geographical space that is recognised,dedicated and managed through legal or other effective means to achieve the long-term cons

25、ervation of nature with associated ecosystem services and cultural values(UN Environment Programme World Conservation Monitoring Centre UNEP WCMC 2016).The UN Decade on Ecosystem Restoration definition includes activities to prevent,halt and reverse degradation and can be understood as a continuum o

26、f practices not limited to rehabilitation and ecological restoration but including other practices such as ecosystem management(The World Bank WB 2022a).“The use of land resources,including soils,water,animals and plants,for the production of goods to meet changing human needs,while simultaneously e

27、nsuring the long-term productive potential of these resources and the maintenance of their environmental functions”(World Overview of Conservation Approaches and Technologies WOCAT 2023).Sustainable land management(SLM)in chapter 4 includes both conservation and regenerative agricultural practices.S

28、hort scale trillion a thousand(short scale)million(1,000,000,000,000 which is 1012)Nature-related riskNet zeroProtected areaRestorationSustainable Land ManagementTrillionNature-positiveviiTable of ContentsAcknowledgementsGlossaryForewordExecutive SummaryChapter 1 The case for a big nature turnaround

29、 1.1 The consequences of insufficient action 1.2 The big nature turnaround 1.3 Nature-based solutions contribution to Rio Convention targets 1.4 SFN analysis and what is new in this report?Chapter 2 How much finance is driving negative impacts on nature 2.1 Public nature-negative finance 2.2 Private

30、 nature-negative finance 2.3 Methodology,data and limitations 2.4 Concluding remarksChapter 3 How much finance is directed to nature-based solutions 3.1 Current finance flows to nature-based solutions 3.2 Current public finance to nature-based solutions 3.3 Current private finance to nature-based so

31、lutions 3.4 Methodology,data and limitations 3.5 Concluding remarksChapter 4 How much investment in nature-based solutions is needed to reach Rio Targets 4.1 Annual investment needs and opportunities 4.2 Nature-based solutions finance needs by region 4.3 Who will finance the required investment in n

32、ature-based solutions?4.4 The Forecast Policy Trajectory a more likely scenario?4.5 Benefits of nature-based solutions investment 4.6 Methodology,data and limitations for nature-based solutions investment needs 4.7 Concluding remarksChapter 5:Key findings and recommendations 5.1 Key findings 5.2 Rec

33、ommendations Greening finance eliminating nature-negative finance Financing green scaling public funding and private investment into nature-based solutions A just transition to a green and inclusive financial system for vulnerable groups,women and Indigenous Peoples 5.3 Concluding remarksReferencesA

34、1.Methodology and data A1.1 Public nature-negative finance flows A1.2 Private nature-negative finance flows A1.3 Public finance flow to nature-based solutions A1.4 Private finance flow to nature-based solutions A1.5 Future nature-based solutions investment needsA2.Physical benefits A2.1 Greenhouse g

35、ases removals A2.2 BiodiversityReferences for Technical Annex iiivixx12346781213141516172025262728313334353738394144444650515262626366697283838586viiiFigure 1.1 Land restoration and the Rio Conventions Figure 2.1 Environmentally harmful subsidies,$trillion(2023 US$)Figure 2.2 Environmentally harmful

36、 subsidies to fossil fuels,$billion(2023 US$)Figure 2.3 Comparing public environmentally harmful subsidy estimatesFigure 2.4 Nature-negative private finance by sector,$billion(2023 US$)Figure 3.1 Public and private finance flows to NbS in 2022,$billion(2023 US$)Figure 3.2 Breakdown in public finance

37、 flows to NbS,$billion(2023 US$)Figure 3.3 Funding for biodiversity protection as a share of national budgets(by region)Figure 3.4 Private finance flows to NbS,by channel,$billion(2023 US$)Figure 3.5 Private finance flows to sustainable supply chains,$billion(2023 US$)Figure 3.6 Farmer private inves

38、tment in conservation agriculture by regionFigure 3.7 Mapping sources and categories of finance to NbS Figure 4.1 Additional annual investment needs to reach Rio targets,$billion(2023 US$)Figure 4.2 Cumulative additional land area by NbS 20252050,Rio-aligned,MhaFigure 4.3 Cumulative additional area

39、by NbS category 20252050,Rio-aligned,MhaFigure 4.4 Additional NbS investment needs per year by region,Rio-aligned,$billion(2023 US$)Figure 4.5 Additional NbS investment needs from public and private sources,Rio-aligned,$billion(2023 US$)Figure 4.6 Cumulative investment needs,20202050,$trillion(2023

40、US$)Figure 4.7 Forecast global Biodiversity Intactness Index(BII)by scenarioFigure 4.8 GHG removals from NbS to meet Rio targets,GtCO2e/yearFigure 4.9 Model(MAgPIE)inputs and outputsFigure 5.1 Current finance flows to NbS,nature-negative finance and investment needsFigure A1.1 Hierarchy of data used

41、 to estimate nature-negative finance flows by sector and activityFigure A1.2 Share of production processes with high or very high impact on nature by sectorFigure A1.3 NbS included in investment needs analysisFigure A1.4 MAgPIE:structure of the optimisation processTable 3.1 Comparing SFN and OECD an

42、alysis of NbS and biodiversity in ODATable 4.1 Cumulative NbS investment needs by regionTable A1.1 Public finance flows description of data usedTable A1.2 Scaling factors used to adjust domestic sectoral expenditure to NbS Table A1.3 Scaling factors to identify NbS in ODA budgetsTable A1.4 Private N

43、bS finance flows data descriptionTable A1.5 Private NbS finance flows assumptionsTable A1.6 Rio-aligned and Forecast Policy Trajectory scenario descriptions Table A1.7 Scenario modelling assumptions Table A1.8 NbS types and definitions Table A1.9 Costs estimated in MAgPIETable A1.10 Investment needs

44、 analysis and approach outside MAgPIETable A1.11 Off modelling analysis data sources Table A2.1 GHG abatement potential by NbSBox 1 Exploring Rio Convention synergies in restoration-a case study from RwandaBox 2 Note on public nature-negative financeBox 3 Official Development Assistance funding for

45、NbS and biodiversity Box 4 Finance for biodiversity protection Box 5 Sustainable and certified commodity marketsBox 6 Agri-food sector impact investing for conversion free supply chainsBox 7 Biodiversity creditsList of FiguresList of TablesList of BoxesixForewordNature is the beating heart of human

46、wellbeing and prosperity.Yet the triple planetary crisis the crisis of climate change,nature and biodiversity loss and pollution and waste is causing nature to atrophy,and with it our chances of ending poverty,hunger and inequity through the sustainable development goals.Nations have recognized this

47、.In response,they have built an interlocking framework of multilateral agreements:from the Paris Agreement to the Kunming-Montreal Global Biodiversity Framework to land degradation neutrality targets and more.Despite commitments made under these agreements,however,governments continue to provide sub

48、sidies and tax rebates to economic activities that drive the triple planetary crisis and deplete natural capital.The third edition of the State of Finance for Nature shows that an annual US$7 trillion in public and private capital flows into nature-negative activities in sectors including fossil fue

49、ls,agriculture and construction.Only US$200 billion per year goes towards nature-based solutions that promote a stable climate,and healthy land and nature.These numbers must be flipped by reducing nature-negative investments and instead investing in nature-based solutions with custodians of the land

50、,such as Indigenous Peoples,among the chief beneficiaries.Protecting nature has huge benefits across the board,including for climate mitigation and adaptation.Governments should prioritize funding for public goods,alongside incentives and regulations that catalyze private finance for sustainable lan

51、d management and restoration.Innovative financial instruments such as green bonds,blended finance and debt for nature swaps can further boost private sector action.At the same time,we need to see a just transition to an inclusive financial system that protects the human right to safe,clean,healthy a

52、nd sustainable environment.There are encouraging signs.Just a few months ago,The Taskforce on Nature-Related Financial Disclosures released recommendations to guide businesses and financial institutions to report and act on nature-related dependencies,impacts,risks and opportunities.Emerging nationa

53、l laws like the Kenyan Restoration Act and the Indian Restoration Law show a growing emphasis on legal frameworks for the restoration and protection of nature.However,action must accelerate and spread across the globe.This report is a clear call for governments and the private sector to repurpose na

54、ture-negative investments and scale up investment in nature.It is a call the world must heed.Inger AndersenExecutive Director,UN Environment ProgrammeNiki MardasExecutive Director,Global CanopyJochen Flasbarth State Secretary in the Federal Ministry for Economic Cooperation and Development(BMZ),Germ

55、any.ExecutiveSummary|Photo by Explore with Joshua on UnsplashExecutivexiExecutive SummaryThe State of Finance for Nature(SFN)annual report series tracks finance flows to nature-based solutions(NbS)and compares them to the finance needed to maximise the potential of NbS to help tackle climate,biodive

56、rsity and degradation challenges.For the first time,this edition estimates the scale of nature-negative finance flows from both public and private sector sources globally.The figure is daunting almost US$7 trillion per year-and is likely to be an underestimate given it includes only direct impacts.P

57、rivate finance flows that have a direct negative impact on nature are US$5 trillion,which is 140 times larger than private investments into NbS.On the public side,environmentally harmful subsidies have increased 55 per cent to US$1.7 trillion since the last report,despite government commitments and

58、driven by fiscal support for fossil fuel consumption.The combined impact of public and private nature-negative finance flows is enormously destructive and undermines potential increases in finance for NbS.However,this misalignment represents a massive opportunity to turnaround private and public fin

59、ance flows to align them with Rio Convention targets.Meanwhile,NbS remain severely underfunded.Current finance flows to NbS are US$200 billion,only a third of levels needed to reach climate,biodiversity and land degradation targets by 2030.Governments continue to provide most funding for NbS(82 per

60、cent).Despite the irrefutable need for action and growing commitments,e.g.zero-deforestation pledges in the agri-food sector,NbS finance has increased only 11 per cent since the 2022 edition.NbS provide critical investment opportunities as they are cost-effective and provide multiple benefits.Invest

61、ment opportunities in sustainable land management can increase fourfold by 2050 based on long-term profitability of sustainable food and commodity production-critical to catalyse private investment.Protection of diverse ecosystems is highly cost-effective and represents 80 per cent of additional lan

62、d area needed for NbS while absorbing only 20 per cent of additional NbS finance by 2030.Given the scale of degradation globally,restoration provides massive opportunities to strengthen ecosystem function and resilience to deliver the ecosystem services that people rely so heavily upon.However,despi

63、te the sizeable investment potential of NbS,the single most impactful action to reduce and halt nature loss is the realignment of nature-negative finance flows.Due to their massive scale,realignment of public and private nature-negative finance flows will have a very significant impact and is necess

64、ary to avoid undermining investment in NbS.While more public finance for NbS is critical,more action is needed to repurpose harmful subsidies.In parallel,governments need to put in place regulation and economic incentives to turn private finance flows away from nature harming activities and toward n

65、ature and nature-based solutions.Meanwhile,the financial sector and the business community at large cannot wait for a fully developed enabling policy environment.There is much they can and must do now to urgently transform unsustainable business models.In short,a major turnaround for nature is neede

66、d.Unless the real economy and financial system reduce financing of nature-negative activities(i.e.greening finance),actions to scale up investment in NbS(i.e.financing green)will be insufficient to tackle the climate,biodiversity and degradation crises.$200bn2021$1.09tn$0.35$0.56$0.02$0.16$1.16$0.02

67、$0.16$0.35AgricultureFossil FuelsFisheriesForestry$1.69tn2022Construction and Engineering,570Electric Utilities and IPPs,445Oil and Gas,390Real Estate Operations,424Food and Tobacco,295Pharmaceuticals,150Healthcare Equipment and Supplies,46Semiconductor Equipment,93Communications and Networking,72Co

68、mputers,Phones and Household Electronics,10Electronic Equipment and Parts,9Beverages,73Personal and Household Products and Services,33Residential and Commercial REITs,81Homebuilding and Construction Supplies,154Hotels and Entertainment Services,72Textiles and Apparel,61Household Goods,42Leisure Prod

69、ucts,21Speciality Retailers,10Automobiles and Auto Parts,140Coal,42Renewable Energy,29Uranium,3Oil and Gas Related Equipment and Services,53Natural Gas Utilities,40Multiline Utilities,17Water and Related Utilities,88Chemicals,227Paper and Forest Products,37Containers and Packaging,37Construction Mat

70、erials,33Metals and Mining,224Machinery,Tools,Heavy Vehicles,Trains and Ships,243Transport Infrastructure,154Aerospace and Defense,111Freight and Logistics Services,106Diversified Industrial Goods Wholesale,25Passenger Transportation Services,192Industrials,1400Utilities,589Basic Materials558Energy,

71、517ConsumerCyclicals.501ConsumerNon-Cyclicals,402Healthcare,196Technology,186Real Estate,505Protection of biodiversity and landscapes,75.9Sustainable agriculture,forestry and fishing,41.5Water resources,and wastewater management,16.2Pollution abatement,15.4Environmental policy and other,13.5ODA,2.2P

72、ublic Finance Flows,165Biodiversity offsets and credits,11.7Sustainable supply chains,8.6Impact investing,4.6Philanthopy,NGO and other,1 3.9PES,3.5Carbon markets,1.5Farmers investments,1.5Private FinanceFlows,35Current finance flows to NbS of US$200 billion are massively outweighed by finance flows

73、with direct negative impacts on nature of almost US$7 trillionof private finance flows with a direct negative impact on nature=5%of global GDPx140 bigger than private finance to NbS(US$35 billion)$5 trillionGovernments provide$165 billion-82%of NbS financePrivate sector provides$35 billion-18%of NbS

74、 financeof private nature-negative finance flowsLess than 1%via biodiversity offsets and sustainable supply chains50%$200 billionTotal finance flows to NbSAlmost US$7 trillionPUBLICPRIVATE55%increase from 2021x10 bigger than public finance flows to NbS(US$165 billion)In 2022,fossil fuel subsidies to

75、 consumers doubled public funding to environmentally harmful subsidies$1.7 trillion$200bn$436bn$542bn$737bn2022202520302050ReforestationAgroforestry-silvoarableRestoration of peatlandsRestoration of seagrassAgroforestry-silvopastureProtected areasAnnual NbS investment to meet Rio targets needs to al

76、most triple from US$200 billion to US$542 billion by 2030But without a big turnaround on nature-negative finance flows,increased finance for NbS will have limited impactNbS provide cost-effective opportunities to deliver on Rio targetsGovernments will continue to lead on NbS finance but private inve

77、stment can increase by 7x,its share growing from 18%to 33%by 2050PUBLICPRIVATE$194bn$274bn$328bn$42bn$69bn$210bn$737bn$542bn$436bn2022202520302050Current,$200bnCurrent,$200bnInvestment needs for restoration double from US$125 billion in 2025 to US$227 billion in 2050 due to extent of land degradatio

78、nInvestment in sustainable land management with revenue streams to increase 4x from US$63 billion in 2025 to US$241 billion in 2050 providing big opportunities to scale private investmentProtection represents 80%of additional land area needed for NbS due to its cost-effectiveness while absorbing onl

79、y 20%of additional NbS finance by 2030ProtectionCumulative land area under NbS category(Mha)Sustainable Land ManagementRestoration20002500300035004000500010001500202520302035204020452050ProtectionSustainable Land ManagementRestorationAlmost US$7 trillionPUBLICPRIVATE|Photo by Jeremy Bishop on Unspla

80、shThe case for a big nature turnaround1Chapter 12In the time between the 2022 edition of State of Finance for Nature(United Nations Environment Programme UNEP 2022a)and this 2023 edition,the planet has experienced the hottest period ever recorded in June,July and August 2023 on the back of the unfol

81、ding climate crisis and this years El Nino phenomenon(Gayle 2023).The United Nations(UN)Secretary General,Antonio Guterres,has referred to humanitys inaction to tackle the most defining challenges of the 21st century in stark terms:“we are on a highway to climate hell with our foot still on the acce

82、lerator”(UN 2022b)and“we must end the senseless and suicidal war against nature”(UN 2022a).Underpinning such remarks is a growing body of science and evidence on accelerating biodiversity loss and land degradation,rising emissions and temperature increases and impacts on economic growth,food securit

83、y,human health and well-being(Ripple et al.2019;Bradshaw et al.2020).Despite global agreements to tackle climate change(Paris Climate Agreement),halt The consequences of insufficient action to tackle climate change,biodiversity loss and land degradation are becoming clearer.Even though greenhouse ga

84、s emissions need to fall by 45 per cent this decade,emissions of carbon dioxide,methane and nitrous oxide reached their highest levels ever in 2021(World Meteorological Organisation WMO 2023).Without immediate reductions in emissions,many people will by 2070 be exposed to average annual temperatures

85、 warmer than nearly anywhere today.These conditions are currently experienced by just 0.8 per cent of global land areas,and they mostly occur in the hottest parts of the Sahara Desert.By 2070,these conditions could spread to 19 per cent of global land areas,potentially affecting over three billion p

86、eople(Xu et al.2020)and leading to mass involuntary migration and serious socio-economic upheaval.Extreme weather events,including floods,droughts,wildfires,storms and extreme temperatures,are increasing in frequency and intensity(The Intergovernmental Panel on Climate Change IPCC 2021).By mid-centu

87、ry,the world stands to lose 1114 per cent of GDP based on the current trajectory of 2C to 2.6C(Swiss Re Institution 2021).1biodiversity loss(Global Biodiversity Framework GBF),reverse land degradation(United Nations Convention to Combat Desertification UNCCD Land Degradation Neutrality LDN)and other

88、 crises,implementation is far from sufficient(UNCCD 2023b).The underlying drivers of climate change,biodiversity loss and land degradation include global systems of production,energy and infrastructure that extract from nature in pursuit of economic growth without regard to ecological limits.Seventy

89、-five per cent of energy consumed still comes from fossil fuels.Thirty-seven per cent of global land area is used for agriculture,one of the largest drivers of biodiversity loss with agricultural expansion linked to 90 per cent of deforestation(Food and Agriculture Organisation FAO 2020;Portfolio Ea

90、rth 2021).Governments continue to provide massive subsidies and tax rebates for economic activities that lead to climate change,biodiversity loss and land degradation while failing to embed environmental costs in the price of goods and services.Since 1954,the rate of biodiversity loss due to human a

91、ctivity has been greater than at any other time in human history due to habitat loss from infrastructure and agriculture,over-exploitation,pollution,invasive species and climate change(Centre for Sustainable Systems 2023).World Wildlife Fund(WWF)s Living Planet Report 2022 reveals an average decline

92、 of 69 per cent in wildlife populations since 1970(WWF 2022).More than 50 per cent of the human population lives within 3km of a freshwater body this human proximity has resulted in a severe decline of 83 per cent in freshwater wildlife populations since 1970.Without immediate action,accelerated bio

93、diversity loss will result in the collapse of ecosystem services such as wild pollination and the provision of food and timber,thereby causing a dramatic loss in global GDP of US$2.7 trillion by 2030(The World Bank WB 2021).UNCCD estimated that up to 40 per cent of the planets land is degraded,impac

94、ting half of the human population and risking half of the worlds GDP(US$44 trillion;UNCCD 2022).If this trend continues,95 per cent of land could become degraded by 2050(UN 2019).This crisis not 1.1 The consequences of insufficient action1 A carbon tax of US$100/tCO2e in the utilities,materials and

95、energy sectors would decrease earnings per share by 40-80 per centChapter 13only jeopardizes the worlds ecosystems but also poses a significant threat to billions of people.Over 100 million hectares(twice the size of Greenland)of healthy,productive land was lost between 20152019,directly affecting 1

96、.3 billion people living on degraded land(UN 2023),especially women smallholder farmers who make up the largest share of the impoverished rural population(Gurung 2023).Unsustainable land-use practices are leading to increased degradation and loss of soil fertility with devastating effects on the del

97、ivery of ecosystem services and food security(Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services IPBES 2018).Negative environmental,socio-economic and health effects caused by the current agri-food system are estimated at US$19.8 trillion,more than twice the market valu

98、e of global food consumption(Riemer et al.2023).This looming existential crisis puts humanity at a crossroads between the current path of climate change,biodiversity loss and land degradation and a path to a future in which ecosystems are protected and restored and the planet remains habitable,provi

99、ding the foundation for sustainable and equitable economic growth.Now is the time to implement global commitments to reverse biodiversity loss and land degradation as well as to urgently reduce emissions while scaling up efforts to support adaptation and mitigation,particularly for vulnerable commun

100、ities.If we can achieve the targets we set,what does the future look like?The Paris Agreement has spurred investment in low-carbon and nature-based solutions,although much action is still needed.Net-zero goals are being set by governments and businesses.United Nations Framework Convention on Climate

101、 Change(UNFCCC;2023)has estimated that by 2030,zero-carbon solutions could be competitive in emission-heavy sectors representing 70 per cent of global emissions.UNEPs Emission Gap Report(2023b)estimates a 66 per cent chance that climate change is limited to 2C throughout the century if all the natio

102、nally determined contributions(both unconditional and conditional)and net-zero targets are achieved.More is needed,but progress has been made.The current trend of rapid biodiversity loss will continue,with 37 per cent of species threatened or extinct by 2100,unless dramatic action in line with the G

103、BF is taken.However,this share could Expected impacts in low-income and lower-middle-income countries are staggering with anticipated falls in GDP of over 10 per cent(WB 2021).Women and other vulnerable groups are particularly at risk,especially those living in regions with high levels of inequality

104、(United Nations Development Programme UNDP 2016).Women and other vulnerable groups,for example,Indigenous Peoples,are often marginalised in terms of political and economic empowerment and have limited access to the finance and technology which are crucial for resilient,sustainable and secure livelih

105、oods.Marginal and degraded lands are often inhabited by the most vulnerable populations.Consequently,as critical resources diminish,poverty in rural communities increases,amplifying the vulnerability and insecurity experienced by women(Bechtel 2010)and Indigenous Peoples.drop to 25 per cent if conse

106、rvation investments are immediately increased(Isbell et al.2022).Biodiversity provides enormous economic benefits Campaign for Nature(CFN)estimated the economic benefits from achieving the 30 x30 target of up to a US$454 billion increase in annual revenues from protected areas and nature,agriculture

107、,forestry and fisheries(Waldron et al.2020).The economic benefits of sustainable land management could be as high as US$75.6 trillion annually,with improved food production worth up to US$1.4 trillion(Economics of Land Degradation ELD 2015).Restoring natural ecosystems can be very cost effective res

108、toring grasslands can have a benefit/cost ratio as high as 35(De Groot et al.2013).Working towards LDN not only brings economic opportunity but promotes biodiversity while protecting and enhancing carbon stores.Restoration promotes sustainable livelihoods by supplying clean water,providing biomass f

109、uel and producing forest products.Social and gender equity could be improved through policy and institutional adjustments that promote equity in the implementation of NbS.Indigenous Peoples,women and other vulnerable groups can be empowered by expanding access to financial resources,enabling them to

110、 scale transformative change through regenerative practices and their connection to nature.Financial access and land rights for marginalised groups remain a significant challenge to be addressed.1.2 The big nature turnaroundChapter 141.3 Nature-based solutions contribution to Rio Convention targetsT

111、his report estimates finance flows to activities identified as nature-based solutions(NbS)using the definition agreed at the United Nations Environment Assembly 5(UNEA5):“actions to protect,conserve,restore,sustainably use and manage natural or modified terrestrial,freshwater,coastal and marine ecos

112、ystems,which address social,economic and environmental challenges effectively and adaptively,while simultaneously providing human well-being,ecosystem services and resilience and biodiversity benefits”(UNEA 2022).NbS are powerful tools to tackle climate change and biodiversity loss while enhancing e

113、cosystem conditions and resilience and human well-being.Some NbS can simultaneously deliver benefits for climate,biodiversity,ecosystems and people.For example,the improved management of peatlands,which contain up to one-third of the worlds soil carbon while covering only three to four per cent of i

114、ts land area,has disproportionate benefits for climate change mitigation and adaptation while providing critical habitat for species and maintaining soil fertility and other critical ecosystem services that support human well-being(UNEP 2022a).In this report,an activity is considered an NbS if it po

115、sitively contributes to biodiversity and/or sequesters/stores greenhouse gases(GHG)and/or restores degraded land and seascapes.As such,the scope of NbS in this report is relatively broad and based on a pragmatic approach.The scope of current finance flows to NbS is shaped by data availability and th

116、e ability to identify NbS activities and finance within available data on sustainable supply chains,impact investing,etc.The analysis does not include finance for climate change adaptation unless it also delivers on climate change mitigation.2 To capture the benefits to people required for NbS,model

117、ling of NbS interventions in the estimation of future investment needs consider social and environmental safeguards.Data,methods and assumptions are described in the text or in the technical annex.2 UNEPs Adaptation Gap report focuses on climate change adaptation,has a chapter on finance and explore

118、s the sectoral distribution of finance targeting both adaptation and mitigation simultaneously(identified as cross-cutting)between 2017 and 2021(UNEP 2023a).Chapter 15Box 1.Exploring Rio Convention synergies in restoration-a case study from RwandaBringing together national action plans siloed under

119、the UNCCD,CBD and UNFCCC frameworks provides the opportunity to align targets and commitments for land restoration,realise multiple benefits and maximise returns on investment(Figure 1.1;UNCBD 2022;UNCCD 2023a).A case study from Rwanda provides evidence of the economic benefits of an integrated vers

120、us a siloed approach to land restoration across the Rio Convention(ELD 2023).To achieve its 2030 targets,Rwanda needs to invest US$300 million per year in land restoration,conservation and sustainable land management.Coordinated action can increase both the effectiveness and efficiency of interventi

121、ons to implement Land Degradation Neutrality(LDN),National Biodiversity Strategies and Action Plans(NBSAPs)and Nationally Determined Contributions(NDCs).In Rwanda,coordinated action of land-based activities under the Rio Conventions can reduce transaction costs of the current siloed approach by almo

122、st 56 per cent or US$45.6 million per year.Efficiency gains from coordinated action especially arise through joint monitoring and evaluation,resourcing,capacity building and the raising of awareness.More efficient implementation translates into higher return on investment from land restoration,which

123、 can provide an incentive for funding activities under LDN,NBSAP and NDC(ELD 2023).Figure 1.1.Land restoration and the Rio ConventionsNDCsNationally Determined ContributionsNBSAPsNational Action Plans to Halt Biodiversity LossUNCCDMitigation and AdaptationGenetic DiversitySpecies/Habitat EcoystemsSa

124、feguard Ecosystem ServicesConservation Sustainable UseRestoration of Land ResourcesLDN Targets(SDG 15.3)Land Degradation NeutralityUnited Nations Convention to Combat DesertificationCBDConvention on Biological DiversityUNFCCCUnited Nations Framework Convention on Climate ChangeSource:UNCCD(2023a).Ch

125、apter 161.4 SFN analysis and what is new in this report?Estimation of private finance flows that negatively impact nature:This report provides for the first time,an analysis of private finance flows that negatively impact nature,with the caveat that only direct(scope 1)nature-negative impacts are es

126、timated.Indirect impacts that negatively affect nature are not included.With this addition,SFN 2023 provides a broader overview of public and private nature-negative capital flows in addition to public and private finance flows to NbS.Expanded scope of activities included in public finance flows tha

127、t negatively impact nature:This analysis includes forestry subsidies in addition to public subsidies that can negatively impact nature in the agriculture,fisheries and energy sectors.This provides a better overview of how much public money works against the Sustainable Development Goals and the Rio

128、Conventions.Expanded scope of activities included in private finance flows to NbS:The SFN 2023 analysis has expanded the scope of activities to include private finance flows to biodiversity credits and private investments by farmers into conservation agriculture.3The State of Finance for Nature(SFN)

129、report series explores the potential for nature to contribute to tackling global crises.The report focuses on current levels of NbS implementation and finance and how much finance for NbS is needed to reach specific Rio targets limit climate change to 1.5C,protect 30 per cent of land and sea by 2030

130、(30 x30 target)and reach land degradation neutrality(LDN)by 2030.The NbS finance gap is the difference between current finance flows and the Rio-aligned scenario NbS finance needs.The analysis aims to inform policymakers,businesses and financial institutions about what the actual disbursement amount

131、s are to NbS and how much additional finance is needed for NbS.Calculating finance flows to NbS is challenging.The methodology,assumptions and data sources used in this report series are continuously improved but remain a“work in progress”.New to this edition are:Investment needs estimated by NbS,so

132、urce(public vs private)and region:Investment needs modelling is undertaken to understand how much finance should go to different types of NbS to meet climate and biodiversity targets most cost effectively.Investment needs are disaggregated by region and by source(public or private),indicating where

133、finance needs to be prioritised.Extended scenario analysis:As the analysis of current finance flows to NbS and investment needs has in previous editions estimated a large finance gap,a new scenario reflecting the(lower)probability of policy implementation and market trends is introduced in Chapter 4

134、.The forecasted policy trajectory scenario is based on the Inevitable Policy Response Forecast Policy Scenario(FPS)+Nature scenario developed by UN-backed Principles for Responsible Investment(UN PRI)for use by investors.3 Conservation agriculture involves the application of three principles:no or m

135、inimum mechanical soil disturbance,biomass mulch soil cover and crop species diversification in conjunction with complementary agricultural practices of integrated crop and production management(Kassam et al.2018).1.2.3.4.5.|Photo by Geranimo on UnsplashHow much finance is driving negative impacts o

136、n nature?2Chapter 28Finance flows to economic activities that harm nature are very large and continue to grow.While there is widespread recognition of the large scale of nature-negative finance flows globally,there are few estimates of the volume of these finance flows due to lack of data and agreed

137、 methodologies.This chapter provides estimates of finance flows from public and private sources that damage nature and affect livelihoods and vulnerable populations.This includes a review of data and estimates of environmentally harmful public subsidies.Despite committing through the Rio Conventions

138、 to reduce emissions and tackle biodiversity loss and land degradation,governments continue to support unsustainable agriculture,forestry,fishery and fossil fuels production and consumption through environmentally harmful subsidies.In addition,for the first time,private finance flows with direct neg

139、ative impacts on nature have been quantified.Many economic activities are based on inaccurately valued and priced natural capital,and incentives for protection and sustainable use are often lacking.As a result,natural capital continues to be severely depleted.Tracked nature-negative public finance f

140、lows are estimated at US$1.7 trillion in 2022,a 55 per cent increase from 2021 levels(Figure 2.1)and more than 10 times greater than public finance flows to NbS(US$165 billion).This increase is despite documented inefficiencies and negative impacts on nature and climate of environmentally harmful su

141、bsidies and despite commitments to reform and repurpose environmentally harmful subsidies under the Rio and other Conventions.This estimate includes measured public subsidies for nature-negative activities in 2022 in four sectors:Agriculture price incentives in and fiscal transfers to the agricultur

142、e sector.Fossil fuels consumption subsidies across oil,electricity,gas and coal contributing to climate change,land conversion and pollution.There is an important conceptual distinction between NbS and nature-negative.Nature-negative finance flows are not the negative equivalent of positive finance

143、flows to NbS.NbS are activities using nature to tackle climate and biodiversity loss while the estimation of nature-negative flows from private sources considers sectors and activities with a negative impact on nature,not just those that are nature based.As a result of these conceptual differences,a

144、 net finance flow to NbS cannot be derived.Annual finance flows from public and private sources that have direct negative impact on nature are estimated at almost US$7 trillion per year.The combined impact of public and private nature-negative finance flows is enormously destructive and undermines p

145、otential increases in finance for NbS.This chapter identifies the sources and volumes of these nature-negative finance flows so that they can be better understood and reformed.Fisheries support for fishing capacity to develop beyond the maximum sustainable yield of fish stocks.Forestry support for l

146、ogging and timber products that incentivises harvest above sustainable rates.In 2022,roughly 90 per cent of tracked negative public flows were directed towards energy(US$1.16 trillion or 69 per cent)and agriculture(US$0.35 trillion or 20 per cent).2.1.Public nature-negative finance44 Full details of

147、 data and methodology are in the technical annex.Chapter 29Figure 2.1.Environmentally harmful subsidies,$trillion(2023 US$)2021-1.090.350.560.020.161.160.020.160.35AgricultureFossil FuelsFisheriesForestry-1.692022Sources:FAO,UNDP and UNEP(2021),IEA(2023),OECD(2020,2022e),Environmental Markets Lab(20

148、18),Skerritt and Sumaila(2021),WB(2021),Koplow and Steenblik(2022).5 Country-level results have not yet been released for 2022 by the OECD/IEA.However the IEA preliminary assessment notes that in 2022 many fossil fuel exporters kept domestic prices lower than international benchmarks,which is counte

149、d as a subsidy.The IEA(2023)data used here is the preliminary estimate for 2022 fossil fuel subsidies,and it may be updated later in 2023.IEA data focuses on consumer subsidies.Globally,fossil fuel subsidies to consumers doubled from US$563 billion in 2021 to US$1.16 trillion in 2022(Figures 2.1 and

150、 2.2)based on IEA data.5 This dramatic increase is primarily driven by subsidies to protect consumers from high fossil fuel prices due to the Russian invasion of Ukraine.In addition to this increase in fossil fuel consumption subsidies,IEA has estimated extra spending of US$500 billion to lower ener

151、gy costs in 2022,with roughly US$350 billion of that amount spent in Europe(IEA 2023).This is more than the additional spend in other advanced economies,emerging markets and developing economies combined.Similarly,gas and electricity subsidies have doubled due to policies to shield consumers from hi

152、gh fossil fuel prices and are concentrated in emerging markets and developing economies(IEA 2023).Figure 2.2 indicates that fossil fuel subsidies to consumers are highly variable over time.The doubling of subsidies between 2021 and 2022 should be seen in the context of the very high fossil fuel pric

153、es resulting from the Russian invasion of Ukraine and the consequent global energy crisis.Nevertheless,evidence suggests that governments continue to prioritise the shielding of consumers over phasing out subsidies in the context of high and volatile fossil fuel prices.This wedge between market and

154、consumer prices for fossil fuels slows a much-needed reduction in consumption and production of fossil fuels and,thereby the transition to renewable energy while absorbing scarce public money(IEA 2023).Chapter 210Figure 2.2.Environmentally harmful subsidies to fossil fuels,$billion(2023 US$)62420102

155、011201220132014201520162017201820192020202120226637977526734783904776174702305631163OilNatural gasElectricityCoalSource:IEA(2023)The Production Gap Report(UNEP 2023c)estimates that fossil fuel production will be much higher than production levels consistent with limiting climate change to 1.5C for c

156、oal(460 per cent),oil(29 per cent),and gas(82 per cent).This disconnect between governments climate and nature pledges and fossil fuel production and associated subsidies is a major driver of the persistence of very large nature-negative finance flows.Environmentally harmful subsidies to agriculture

157、 are estimated at over US$345 billion,reflecting that agriculture receives the highest level of support of the land-use sectors considered.6 An analysis of data covering 54 countries estimated total support to the agricultural sector of US$817 billion per year between 2019 and 2021,mostly via suppor

158、t to producers(71 per cent).In contrast,budget support for public goods and services,which are key to the development of NbS-based infrastructure and services,received only 13 per cent of total support to the agriculture sector(OECD 2022e).Based on current trends,support to producers could reach alm

159、ost US$1.8 trillion by 2030,channelling limited public funds away from social spending and investment into NbS(UNEP,UNDP and FAO 2021).In addition to absorbing limited fiscal resources,poorly designed subsidies can incentivise behaviours harmful to nature.Price incentives for certain products(e.g.be

160、ef,rice,milk)using different fiscal subsidies(e.g.coupled subsidies,which are linked to the use of inputs,such as fertilisers,or to the volume of production of outputs)are known to have a potential negative impact on nature.A World Bank(2023)analysis has recently demonstrated the causal link between

161、 agricultural subsidies and global deforestation,estimating that agricultural price supports are responsible for the annual loss of 2.2 million hectares of forest.6 Note that the estimates for subsidies to agriculture,forestry and fishing are for 2021;2022 data was not available at the time of analy

162、sis.Chapter 211Box 2.Note on public nature-negative financeNature-negative activity is defined here as“any activity with a direct negative impact on nature”including a negative impact on biodiversity,land quality or climate change interconnected with the societal repercussions for the most disadvant

163、aged.7 SFN estimates of public nature-negative finance flows differ from some other studies due to differences in scope and methods(Figure 2.3).Taking these differences into account,estimates across studies are likely to be consistent.This report focuses on estimates of targeted subsidies in the agr

164、iculture,forestry,fishery and fossil fuels sectors.The Dasgupta Review,for example,looks more broadly at explicit and implicit subsidies and captures undercharging for environmental costs and general consumption taxes(Dasgupta 2021).Similarly,the inclusion of implicit subsidies leads to large differ

165、ences in estimates of fossil fuel subsidies with the estimate used here of US$1.4 trillion consistent with IEA(2023)and IISD(2023),while the International Monetary Fund,which includes implicit subsidies,estimates them at US$7 trillion in 2022.7 Definition based on Deutz et al.(2020):Nature-negative

166、financial flows refer to financial flows for activities that could potentially have a negative effect on nature.Financial flows in the form of subsidies are those that induce production or consumption activities that exacerbate nature loss.Figure 2.3.Comparing public environmentally-harmful subsidy

167、estimatesUS$5-7 trillionDasguptaReviewUS$1.8 trillionEarthtrackBteamUS$1.5-1.9trillionSFN 2023Based on IMF fossil fuel subsidies estimates that captures both explicit and implicit subsidiesAlso includes support to sectors like transport and construction,for which illustrative estimates are built fro

168、m a handful of projects/geographiesBased on explicit subsidies for which global datasets exist across agriculture,fishing,forestry and fossil fuelsChapter 2122.2.Private nature-negative financePrivate finance flows to activities with direct negative impacts on nature were estimated to be at least US

169、$5 trillion in 2022.This is 140 times greater than current private finance flows to NbS.Nature-negative private finance flows were identified across most economic sectors.The five industries receiving the most financing were construction and engineering,electric utilities These estimates of nature-n

170、egative private finance flows are likely to be underestimated as the methodology focuses on direct impacts only.Indirect impacts such as supply chain and finance sector exposure to nature-negative activities were not included.Sector focus:Industrials finance activities with high nature-negative impa

171、cts(US$1.4 trillion),thereby contributing to air and soil pollution and the clearing of natural habitats.Basic materials:Metals and mining is a key industry for the climate transition but is also investing US$224 billion a year with substantial nature-negative impacts,including degradation and fragm

172、entation of habitats.Energy:High levels of finance(US$517 billion)continue to flow to oil,gas and coal production,which have negative impacts on climate,nature and people,including on human health.Consumer non-cyclicals:While direct finance flows to this sector are a relatively small share(8 per cen

173、t)of total nature-negative finance,food,agriculture,forestry and fishing generate large nature-negative impacts.Figure 2.4.Nature-negative private finance by sector,$billion(2023 US$)Construction and Engineering,570Electric Utilities and IPPs,445Oil and Gas,390Real Estate Operations,424Food and Toba

174、cco,295Pharmaceuticals,150Healthcare Equipment and Supplies,46Semiconductor Equipment,93Communications and Networking,72Computers,Phones and Household Electronics,10Electronic Equipment and Parts,9Beverages,73Personal and Household Products and Services,33Residential and Commercial REITs,81Homebuild

175、ing and Construction Supplies,154Hotels and Entertainment Services,72Textiles and Apparel,61Household Goods,42Leisure Products,21Speciality Retailers,10Automobiles and Auto Parts,140Coal,42Renewable Energy,29Uranium,3Oil and Gas Related Equipment and Services,53Natural Gas Utilities,40Multiline Util

176、ities,17Water and Related Utilities,88Chemicals,227Paper and Forest Products,37Containers and Packaging,37Construction Materials,33Metals and Mining,224Machinery,Tools,Heavy Vehicles,Trains and Ships,243Transport Infrastructure,154Aerospace and Defense,111Freight and Logistics Services,106Diversifie

177、d Industrial Goods Wholesale,25Passenger Transportation Services,192Industrials,1400Utilities,589Basic Materials558Energy,517ConsumerCyclicals.501ConsumerNon-Cyclicals,402Healthcare,196Technology,186Real Estate,505Sources:ENCORE,Refinitivand independent power producers,real estate operations,oil and

178、 gas,and food and tobacco(Figure 2.4).These industries received 43 per cent of nature-negative financial flows but represented only 16 per cent of total private investment flows.Therefore,actions to address impacts on nature and climate by these industries would have a disproportionate effect on pre

179、venting and reversing nature-negative impacts.Chapter 213In the agriculture,forestry,fishing and food sectors and value chains,downstream activities,such as manufacturing,retail and distribution,which have typically been thought to have lighter direct nature impacts,received most of the private inve

180、stments(83 per cent)compared to upstream activities.8 Conversely,upstream activities related to primary production of raw materials potentially drove the largest direct impacts but were a much smaller share of finance flows(17 per cent).These findings indicate that there is scope for greater investm

181、ent in sustainable production modes in upstream activities in these sectors as well as for prevention and mitigation of nature-negative impacts and risks to livelihoods security.8 Only direct impacts from downstream activities have been captured.Indirect nature impacts from downstream activities in

182、supply chains have not been quantified.For example,water pollution as a direct result of manufacturing would be captured but not deforestation from commodity production in the manufacturers supply chain.9ENCORE Exploring Natural Capital Opportunities,Risks and Exposure is a web-based tool which asse

183、sses nature-related risks.2.3.Methodology,data and limitationsPublic nature,negative-finance flows were estimated using existing research and data on environmentally harmful subsidies in agriculture(FAO,UNDP and UNEP 2021;OECD 2022a),fossil fuels(IEA database),fisheries(Sumaila et al.2019;Skerritt a

184、nd Sumaila 2021)and forestry(Koplow and Steenblik 2022).Where 2022 data was not available,the most recent estimate was used as a proxy and converted to 2023 USD.Further details on methodology and data sources can be found in the technical annex.Nature-negative-finance flows from private sources were

185、 estimated based on the following methodology:Data was collected on corporate loans,bonds and equity proceeds in 2022 with coverage of approximately US$14.5 trillion as classified by the Refinitiv Business Classifications(TRBC)economic sectors and activities.Two approaches were used to estimate sect

186、or-level and activity-level flows,which returned similar outcomes,thereby providing more confidence in how sectors with direct nature-negative impacts were identified.ENCORE9 tool was used to calculate the share of production processes with high or very high impacts on nature within each subindustry

187、.All industry activities were reviewed and tagged as nature-negative based on literature and expert insights.Aggregate negative finance flows across tagged sub-industries and activities.The estimates are approximate due to challenges in tracking nature-negative finance flows.First,there are signific

188、ant gaps in the data,particularly the absence of comprehensive and detailed private finance flow data and inadequate sector-level granularity on nature-negative activities and impacts.Consolidated private finance data exists at a high granularity level but is frequently not publicly available.Data o

189、n public finance flows(e.g.OECD and IMF COFOG)tend not to provide breakdowns of sector-level spending to isolate nature-negative expenditures.Estimation of environmentally harmful subsidies is available only for some sectors,leading to an underestimate of nature-negative public finance.Second,the ab

190、sence of a widely accepted classification system or green taxonomies at the sector level prevents easy identification of nature-negative,positive or neutral,and NbS activities and spending.While several national or regional taxonomies have been or are being developed to help identify green activitie

191、s(e.g.EU Green Taxonomy,Common Framework of Sustainable Finance Taxonomies for Latin America and the Caribbean),they tend to focus on climate mitigation and adaptation rather than NbS or nature.Finally,there is not yet widespread application of tools and frameworks to assess the scope of activities

192、affecting nature.Economic sectors that have a negative impact on climate can be identified based on their emissions intensity.However,measuring effects on nature is more complex.While there is an increasing number of high-quality frameworks and tools to measure nature impacts,dependencies and risks,

193、application of these is nascent.Chapter 2142.4.Concluding remarksThis analysis underscores the urgent need to reduce and re-orient finance flows that negatively impact nature and society.In addition to enhancing capital flows to NbS activities and assets,strategies to achieve nature-positive outcome

194、s need to transform existing economic structures and activities that drive nature-negative impacts and exacerbate poverty,hunger and gender inequalities.Given the magnitude of government support that harms nature,economic activity will continue to do so unless environmentally harmful subsidies are r

195、eformed and repurposed so that subsidies support activities that benefit nature.There is a wealth of evidence and knowledge on how to tackle environmentally harmful fiscal policies.What is needed is political will.The imperative of subsidy reform needs to transcend partisan politics to feature in th

196、e agendas of all political parties.This analysis indicates that private finance flows that harm nature are orders of magnitude greater than private finance to NbS.While voluntary actions by businesses and financial institutions are important,they have been and are likely to remain insufficient.There

197、fore,governments need to regulate and provide incentives to ensure alignment of private finance with nature-positive activities and outcomes.On the positive side,the next chapter analyses volumes and channels of current finance flows to NbS from both public and private sources.|Photo by Justin Kauff

198、man on UnsplashHow much finance is directed to NbS3Chapter 316This chapter provides an overview of current finance flows to NbS from public and private sources.It is critical to quantify finance flows to NbS via different channels,for example,public funding of protected areas,payments for ecosystems

199、 services and sustainable supply chains,to understand what funds are being disbursed for NbS.10This analysis estimates that total annual finance flows to NbS in 2022 were roughly US$200 billion(Figure 3.1).As in previous editions,public finance remains the main source of finance at 82 per cent(US$16

200、5 billion)of total NbS finance flows.Over 71 per cent(US$117 billion)of public finance for NbS is directed to biodiversity and landscape protection and to sustainable agriculture,forestry and fishing.Private finance for NbS remains modest at US$35 billion(18 per cent of total finance flows to NbS).M

201、ore than half(57 per cent)of private NbS finance is channelled through biodiversity offsets and credits and sustainable supply chains.3.1.Current finance flows to nature-based solutions10 This analysis only includes expected and actual disbursements,rather than commitments,to ensure estimates are ba

202、sed on real finance flows.Figure 3.1.Public and private finance flows to NbS in 2022,$billion(2023 US$)Protection of biodiversity and landscapes,75.9Sustainable agriculture,forestry and fishing,41.5Water resources,and wastewater management,16.2Pollution abatement,15.4Biodiversity offsets and credits

203、,11.7Sustainable supply chains,8.6Impact investing,4.6Philanthopy,NGO and other,1 3.9PES,3.5Carbon markets,1.5Farmers investments,1.5Environmental policy and other,13.5ODA,2.2Public Finance Flows,165Private FinanceFlows,35Note:1.The“other”grouped with philanthropy and conservation NGOs is private fi

204、nance mobilised through the Global Environment Facility(GEF),Green Climate Fund(GCF)and Development Assistance Committee(DAC).Sources:OECD(2023e);IMF(2021);OECD(2023a;2023b;2023c;2023d;2023e)(ODA,Philanthropy,private finance mobilised by ODA);Financial reports from five NGOs:CI(2022),RSPB(2022),TNC(

205、2022),WCS(2022)and WWF(2022);FAO(2018b;2018c);Rainforest Alliance(2022a;2022b);RTRS(2022);Solidaridad(2019);De Jong(2019);GIIN(2020);Capital for Climate NbS Funds(2023);Impact Yield(2023);Partnership for Forests(2023);Ecosystem Marketplace(2022);Kassam et al.(2019)Chapter 317Total traceable finance

206、flows to NbS in 2022 increased by 11 per cent(US$20 billion)relative to 2021 levels.This increase is largely attributable to a US$17 billion increase in public funding of NbS,almost half through increased funding(US$9 billion)for sustainable agriculture,forestry and fishing(Figure 3.2).This was driv

207、en by post COVID-19“Build Back Better”spending and targeted conservation spending by the US Department of Agriculture.In fact,76 per cent of finance flows for sustainable agriculture,forestry and fishing comes from China,the US,Canada,Japan and Turkey.It is thus not surprising that significant incre

208、ases in any of these countries are reflected in global estimates.As noted earlier,the largest share of public NbS finance(US$76 billion or 46 per cent)goes toward protection of biodiversity and landscapes.This has grown by 7 per cent from US$71 billion to US$76 billion since SFN 2022.More than half

209、of finance for NbS to tackle biodiversity loss originates in four countries(US,France,Italy and Germany)the global increase is related to increased spending in the US on wildlife conservation and in the EU under the EU biodiversity strategy to 2030.China also has significant expenditure on biodivers

210、ity,with roughly US$35 billion spent since 2017(China,Ministry of Foreign Affairs 2020).3.2.Current public finance to nature-based solutionsFigure 3.2.Breakdown in public finance flows to NbS,$billion(2023 US$)Protection ofbiodiversity andlandscape70.975.9SFN 2022SFN 202315.516.214.713.52.22.212.315

211、.432.241.5Sustainableagriculture,forestry andfishingWastewater managementPollutionabatementEnvironmentalpolicy and otherODANote:An additional nine countries were included in SFN 2023.Therefore SFN 2022 numbers were revised to include those nine countries for comparison.Sources:United States of Ameri

212、ca,Fish and Wildlife Service(2022);European Commission(2023);China,Ministry of Foreign Affairs(2020);United States of America,Department of Agriculture(2022a and 2022b);FAO,UNDP and UNEP(2021);IEA(2023);OECD(2020;2023a;2023c;2023e);Environmental Markets Lab(2018);Skerritt and Sumaila(2021);Interpol(

213、2020);WB(2021)Chapter 318Box 3.Official Development Assistance funding for NbS and biodiversitySFN estimates for public development finance to NbS delivered via Official Development Assistance(ODA)differ from estimates of biodiversity-related ODA from some other studies(OECD 2022b;TNC 2023)due to di

214、fferences in scope and methodology,despite using the same data source(OECD Creditor Reporting System).Table 3.1 summarises key differences.On scope,the OECD estimates development finance that is marked for biodiversity at the source.SFN tracks public development finance to NbS.As there are no marker

215、s for NbS,the SFN analysis applies scaling factors.These scaling factors represent the percentage of investment in the sector that can be confidently considered as NbS.11 A further adjustment is made for uncertainty to reflect the level of confidence in identifying NbS related expenditures.SFN aggre

216、gates the scaled value of expenditures on biodiversity and additional sub-sectors,for example,forestry and fishing,and the mitigation of the impacts of fuelwood and mineral exploitation.ODA estimates also differ due to what is being measured.For all finance flows,including ODA,SFN measures actual an

217、d expected disbursements.While OECD CRS data provides both commitment and disbursement level data,studies on biodiversity finance in the OECD(2022b)and TNC(Deutz et al.2020)focus on commitments.Table 3.1.Comparing SFN and OECD analysis of NbS and biodiversity in ODAUS$2 billion,2021 priceDevelopment

218、 financetargeting NbSSFN 2023OECDUS$10 billion(2011-20 average),2020 priceDevelopment finance for biodiversity-related objectivesODA disbursement to public sectorODA commitments with Rio MarkersEstimates development finance going to NbSEstimates development finance marked at source for biodiversityP

219、er cent share of relevant sectors,using scaling factorsTotal flows to biodiversity related markersSource:OECD(2022b).11 See technical annex for detail on scaling factorsChapter 319Box 4.Finance for biodiversity protection Despite global commitments for protection of biodiversity,a large financing ga

220、p remains:SFN 2023 and related biodiversity finance analyses estimate current public biodiversity finance between US$80-120 billionUS$100-200 billion is the current biodiversity funding gap annually for the 30 x30 biodiversity target190 countries have committed to the 30 x30 target(50 in 2021,and re

221、st in 2022),establishing more ambitious targets and higher financing needs for the futureFigure 3.3.Funding for biodiversity protection as a share of national budgets(by region)Note:1.Average share across all countries for which data was available;2.Middle eastern and reforming economies;3.US,China,

222、Italy,France and Germany.Sources:Mongabay(2016);Seidl et al.(2020);Nature Based Solutions Initiative(2022);BIOFIN(2022).75%of global biodiversity spendingNorth America0.1%0.1%Latin AmericaLatin America2.3%Africa0.1%Europe0.2%MEA and REF20.3%5of the most biodiverse countries spent on average 100m in

223、20215countries including Brazil,Croatia,Denmark,Hungary and South Africa recorded a decline in biodiversity spending between 2020-21 20Asia0.3%OceaniaChapter 320Flows of private finance into NbS are estimated at US$35 billion in 2022,equivalent to 18 per cent of total finance for NbS globally.Privat

224、e NbS finance flows have increased by US$3 billion(10 per cent)since SFN 2022 due to growth in biodiversity offset markets,sustainable supply chains and impact investment.Figure 3.4 provides a breakdown of the NbS finance channels for which there is data.Over half(57 per cent)of private finance flow

225、s were via biodiversity offsets and credits12 and sustainable supply chains.While small in absolute numbers,the fastest growth was seen in philanthropy(39 per cent increase from US$0.96 billion to US$1.34 billion driven by support for 30 x30)and private finance mobilised by ODA(31 per cent increase

226、from US$0.55 billion to US$0.72 billion)via blended finance deals,for example,blue bonds and rhino bonds.133.3.Current private finance to nature-based solutions12 Biodiversity offsets represent compensation for negative impacts on biodiversity.13 Blue bond-A debt instrument issued by governments,dev

227、elopment banks or others to raise capital from impact investors to finance marine and ocean-based projects that have positive environmental,economic and climate benefits(WB 2018).Rhino bond-The worlds first Wildlife Conservation Bond,which was issued by the World Bank to help increase the population

228、 of the endangered Black Rhino species in South Africa(WB 2022b).Figure 3.4.Private finance flows to NbS,by channel,$billion(2023 US$)03540453025201510535.311.78.64.63.51.91.51.51.30.7TotalBiodiversityoffsets andcreditsSustainable supply chainsImpact InvesingPESConservation NGOsCarbon MarketsFarmers

229、 investmentsPhilanthropyPrivate finance mobilised by DAC,GEF,GCFSources:OECD(2023b;2023d;2023f);CI(2022);RSPB(2022);TNC(2023);WCS(2023);WWF(2022);FAO(2018b;2018c);Rainforest Alliance(2022a;2022b);RTRS(2022);RSPO(2022);Solidaridad(2019);De Jong(2019);GIIN(2020);Capital for Climate(2023);Impact Yield(

230、2023);Partnership for Forests(2023);Ecosystem marketplace(2021);Kassam et al.(2018);Bennett et al.(2017);Hamrick(2017).Chapter 321This report estimates that roughly US$11.7 billion was invested in biodiversity offsets in 2022.14 Mandatory biodiversity offsetting schemes,such as Biodiversity Net Gain

231、 in the UK(Natural England 2022)or the New South Wales(NSW)Biodiversity Offset Scheme in Australia,are emerging as a key regulatory requirement.This estimate is likely to be an underestimate as only a subset of schemes provides accurate reporting.More than 100 countries have policies on biodiversity

232、 offsetting(Biodiversity Consultancy 2016).In the US,the Clean Water Act compensatory mitigation requirements stimulated the creation of mitigation banking programmes that annually issue more than one million water and stream credits.Mitigation banking is expected to grow by 13 per cent per year ove

233、r the next five years(Facts and Factors 2022).Private investment in sustainable supply chains provides the second largest finance flow at US$8.6 billion in 2022.Sustainable supply chain certification is a major market with a third of cocoa and half of coffee production under some sustainability cert

234、ification,and demand is increasing(Centre for Promotion of Imports 2020).Direct investment of farmers into conservation agriculture provides a further US$1.5 billion per annum,bringing total finance flows to sustainable agriculture to US$10.1 billion per annum.While a significant share of total priv

235、ate finance to NbS,private finance to sustainable agriculture is only a fraction of the value of agricultural commodity markets of US$4 trillion annually(US$1.3 trillion is traded globally;Taskforce on Nature Markets 2022).This small share stands in stark contrast to the evident need and potential o

236、f transforming food systems.In the mitigation hierarchy,biodiversity offsets are defined as a last resort mechanism,which comes after avoiding,minimising and rehabilitating(Kujala et al.2022).However,there are concerns that biodiversity offsets do not provide“net biodiversity gains”and that they can

237、 provide disincentives to reduce the footprint of economic activities on nature(Hahn et al.2022).This analysis includes biodiversity offsets,with the rationale that,in their absence,there would be a greater loss of biodiversity.Mandatory offsetting schemes help to ensure that biodiversity loss is le

238、ss than it would be if these schemes were not in place.Finance flows to sustainable supply chains are estimated based on volume and value of certified forest and agricultural and seafood products.Investment into certified forest products is the largest source of finance for sustainable supply chains

239、 at US$3.26 billion(almost 40 per cent).The certified forest products market is valued at roughly US$220 billion(UNDP 2020).FSC is a major player in 2017,12 per cent of global wood production was sourced from FSC certified forests(FSC 2018).The second largest market absorbing investment is certified

240、 organic agricultural goods at US$2.9 billion per year,roughly one-third of total investment in certified products globally.Biodiversity offsets and creditsSustainable supply chains and conservation agriculture14 This estimate is based on a subset of biodiversity offset flows included in the Forest

241、Trends 2016 survey of four major mitigation banking programs and 103 compensation funds programs.Chapter 322Figure 3.5.Private finance flows to sustainable supply chains,$billion(2023 US$)3.262.901.600.500.240.030.02Certified forestry products1Certified organic agricultural goods2Certified seafood1R

242、ainforest Alliance certified coffeeCertified palm oil1RTRS certified soyRainforest Alliance certified cocoaNote:1.Estimate has not been updated since SFN 2022 due to a lack of data.2.Certified agricultural good reflects the organic agriculture market based on Statista(2022).Sources:Rainforest Allian

243、ce(2022a;2022b);RTRS(2022);Solidaridad(2019);De Jong(2019);UNDP(2020);Deutz et al.(2020);Naphade(2020);Statista(2022);FAO(2018a;2018b);Allied Market Search(2021);Expert Market Search(2022);Research and Market(2022).Investment trends in markets for coffee,palm oil,soy and cocoa are important as produ

244、ction of these commodities can significantly contribute to deforestation.Figure 3.5 illustrates that finance flows to certified deforestation-free coffee,palm oil,soy and cacao together are relatively low at US$790 million in 2022,less than 10 per cent of annual investment in sustainable supply chai

245、ns.The volume of annual investment is also small relative to the value of the certified market,which is small relative to global production volumes and value.Box 5 provides some key statistics on the sustainable market size relative to wider commodity markets.The share of commodity markets that is c

246、ertified varies from 1 per cent for soybeans to 68 per cent for Rainforest Alliance coffee and cacao.Increasing pressure on producers to reduce impacts on deforestation,for example,via the EU Deforestation Regulation,has increased efforts to avoid deforestation and to document this avoidance via cer

247、tification.For example,the Roundtable for Sustainable Palm Oil certification has gained traction,increasing the area certified by 66 per cent between 2017 and 2022(Roundtable for Responsible Soy RSPO 2022).Nevertheless,far higher levels of investment into credibly certified deforestation and convers

248、ion-free production and away from activities that finance deforestation is urgently needed,in tandem with enabling public policies.Chapter 323Box 5.Sustainable and certified commodity markets The size of the certified forest products market is estimated at US$220 billion.About 5 per cent of the seaf

249、ood market is certified as Marine Stewardship Council(MSC),with an estimated market size of US$5 billion.The market size of Rainforest Alliance certified coffee and cocoa was estimated at US$40 billion and$1.5 billion respectively.Certified production represent about 6-8 per cent of global productio

250、n volumes.About 5 per cent of global palm oil production volume is certified under RSPO,with a market value estimated at US$15.8 billion in 2019.About 1 per cent of global soybean production volumes was certified under the RTRS in 2022.The sustainable soybean market was estimated at around US$2.2 bi

251、llion.Sources:UNDP(2020);Naphade(2020);Rainforest Alliance(2022a;2022b);Netherlands,Ministry of Foreign Affairs(2021);Bermudez et al.(2022).For the first time,this edition estimates private finance flows to NbS via farmer investment in conservation agriculture.Farmer use of their own profit to inves

252、t in conservation practices15 is distinct from sustainable supply chain finance,which is based on downstream corporate investment in supply chains.No publicly available data sets exist on farmer investment into conservation agriculture.This analysis uses a bottom-up approach based on annual growth i

253、n areas under conservation agriculture,average capex per hectare and the share of total agricultural investment from farmer retained profits(see technical annex for details).The results indicate that US$3.9-4.2 billion is invested annually into conservation agriculture.Of this total,US$1.4-1.6 billi

254、on is financed by farmer retained profit.Figure 3.6 highlights countries with high levels of farmer investment in conservation agriculture.Together,the US,Australia and Argentina account for over half of private investment into conservation agriculture.Farmer private investment in conservation agric

255、ulture15 These investments are like the economic decisions of households/individuals on climate finance that are tracked in the Climate Policy Initiative Global Landscape of Climate Finance reports.Households and individuals accounted for about 20 per cent of total private climate finance in 2019/20

256、20(CPI 2021).Chapter 324Figure 3.6.Farmer private investment in conservation agriculture by regionUSA28%17%14%11%9%AustraliaArgentinaChinaCanadaUS$1.4-1.6 billionBoliviaKazakhstanUruguayUnited KingdomOtherBrazilNote:Only conservation agriculture on cropland is considered here as global data on the e

257、xtent of broader regenerative practices are not publicly available.Sources:Kassam et al.(2019);Wilkinson(2020);Elwin et al.(2023).Obstacles to equal participation in agri-food systems impedes productivity and contributes to wage disparities.For example,women in agriculture often receive lower wages

258、and have lower productivity than men,primarily due to discriminatory social norms that restrict women from some agricultural activities and technologies.They have limited access to assets and resources like irrigation,livestock and land ownership,finance and technology.In many countries,land ownersh

259、ip and legal protection are limited for vulnerable groups,which has consequences for access to technical support,critical financing for inputs and access to markets.Addressing social and gender disparities in agri-food systems is essential to advance not only social and gender equality but also to p

260、romote global food security and nature and climate-positive economic growth.Women and Indigenous Peoples hold valuable ancestral knowledge about such matters as crop diversity and regenerative practices.For example,closing the gender gap in farm productivity and wage disparity could boost global GDP

261、 by 1 per cent(almost US$1 trillion)and reduce global food insecurity by 2 per cent,benefitting 45 million people(FAO 2023).Providing financial support and credit access to rural women and other marginalised groups can support the transformation of the agri-food system into one that is more producti

262、ve,regenerative and equitable.Tackling social and gender inequity in agricultureChapter 325SFN tracks finance flows from major public and private sources to NbS categories.Ideally,with complete and detailed data,finance flows would be tracked across all sources,instruments and use of proceeds by eco

263、systems and NbS type.However,due to limited data and granularity,SFN looks at financial flows across sources and categories of finance as well as NbS types,as illustrated in Figure 3.7.16Most governments and companies do not yet report financial data using NbS or nature tags.However,the UN Statistic

264、al Division and the OECD are exploring how to better capture environmental spending in national expenditure data(United Nations Statistics Division UNSD 2022;OECD 2023e).Joint UNEPUniversity of Oxford work 3.4.Methodology,data and limitationsFigure 3.7.Mapping sources and categories of finance to Nb

265、SGovernmentProtection of biodiversity and landscapeProtected areas/avoided conversionProtected areasAvoided deforestationAvoided peatland conversionAvoided mangrove conversionAvoided grassland conversionAvoided seagrass conversionReforestationRestoration of peatlandRestoration of mangroveRestoration

266、 of saltmarshesRestoration of seagrassAgroforestry-silvoarableAgroforestry-silvopastureCover cropsGrazing-optimal intensityRestorationOther1Sustainable land managementSustainable agriculture,forestry and fishingWater resources and wastewater managementPollution abatementEnvironmental policy and othe

267、rOfficial Development AssistanceBiodiversity offsets and creditsSustainable supply chainsImpact investingCarbon marketsPhilanthropy,NGO and otherPayments for ecosystem services(PES)Farmers investments into conservation agricultureState-owned financial institutionsDevelopment finance institutions(DFI

268、s)Business and corporationsPrivate financial institutionseNGOs and philanthropyFarmers,households and individualsSpecialised fundsSources of financeFinance Flow Categories in SFNNbS categoriesNbSPublic fundsProtectionPrivate capitalOtherRestorationSustainable land managementNote:1.The“other”category

269、 captures activities that directly support NbS implementation,such as technical assistance and environmental policy development.16 The flows depicted by the arrows are illustrative but not exhaustive;that is,there are links between types of finance flows and types of NbS that may not be indicated.on

270、 the Sustainable Budgeting Approach also aims to provide more granular data on public finance flows that are relevant for nature and have positive,negative or neutral impacts on natural capital.These efforts may allow future SFN reports to disaggregate NbS financial flows in greater detail.Chapter 3

271、26SFN 2023 calculates a“best estimate”of NbS finance flows in 2022:When 2022 data was unavailable,data from previous years was used as a proxy.In the absence of NbS-tagged financial datasets,SFN 2023 combined finance flow data with informed assumptions about NbS relevance to estimate NbS finance flo

272、ws.17 The risk of double counting when finance flows are included in multiple categories within data sets was minimised by triangulating data between sources and definitions.Changes in estimates over time are real changes and are presented in 2023 USD.When there were changes in scope,methodology or

273、data in SFN 2023,estimates in SFN 2022 were recalculated on the same basis so they remain comparable.Public funding for NbS from governments and public financial institutions was estimated based on domestic expenditures across five governmental budget lines,the largest of which was protection of bio

274、diversity and landscapes as well as sustainable agriculture,forestry and fishing.The situation is more complex for data on private finance flows to NbS.Due to the format of available data,private finance flows to NbS were estimated based on finance flows from businesses and corporations,private fina

275、ncial institutions,specialised funds,eNGOs and philanthropy,and farmers,households and individuals.Data sources are listed in the annex.When tracking investments into NbS,it is critical to recognize gender dimensions,including womens contributions.National statistics should be moving towards gender-

276、disaggregated data at the sector level,including participation rates,access to resources,decision-making power and the impacts of nature-based solutions on different genders.It also helps in tracking progress and identifying areas that require specific interventions.While there has been increased fi

277、nance flowing to NbS,these flows are vastly overshadowed by the nature-negative finance flows(chapter 2).Finance flows to NbS are less than three per cent of the volume of nature-negative finance flows.The contrast is starker for private NbS finance flows,which are less than one per cent of private

278、nature-negative finance flows.Unless nature-negative finance is tackled and redirected,increases in NbS finance will have only marginal impacts.The next chapter looks at how NbS can contribute to meeting global goals around climate,biodiversity and land degradation and the associated investment need

279、s.Current finance flows are compared to investment needs to estimate the finance gap that is preventing achievement of the Rio targets.17 See technical annex for assumptions and adjustment factorsThis chapter has documented the volume and channels of finance flows to NbS.Total finance flows to NbS h

280、ave been estimated at US$200 billion in 2022.Public finance remains the main source,with 82 per cent(US$165 billion)of the total flow.ODA flows have stagnated,and the share of ODA going to nature remains small(1 per cent in total finance flow to NbS).Private finance to NbS has remained low.The large

281、st component,biodiversity offsets,is driven by regulatory requirements,which can be effective in generating the needed change in business and finance.While sustainable supply chains provide significant private finance to NbS,the share of organic products and deforestation and conversion-free product

282、s in agricultural production remains very small,indicating that many unrealised opportunities remain.3.5.Concluding remarks|Photo by Matt Howard on UnsplashHow much investment in NbS is needed to reach Rio Targets4Chapter 428This chapter estimates how much investment in NbS is needed to use the pote

283、ntial of ecosystems(the Agriculture,Forestry and Other Land Use contribution)to reach Rio Convention targets to limit global warming to below 1.5C,halt biodiversity loss by ensuring that 30 per cent of land and sea is protected by 2030 and reach land degradation neutrality by 2030.Investment needs a

284、re calculated for different types of NbS,suggesting how much money needs to be invested and where.Further granular analysis by region provides information on the different needs and opportunities for protected areas18 and other protection-related NbS,19 ecosystem restoration20 and sustainable land m

285、anagement.21 Based on modelling of potential financial returns of NbS,this report estimates the likely relative share of public and private finance for NbS over time.Investment needs are compared to current finance flows to estimate the gap between current finance and what is needed.Note that invest

286、ment in NbS needs to enhance gender equality,reduce poverty,increase resilience and empower marginalised communities.Although not explicitly analysed in SFN 2023,urban-NbS will become increasingly important as currently 56 per cent of the global population lives in urban areas and the urban populati

287、on is forecast to,which will double by 2050(WB 2023b).Figure 4.1 depicts the additional finance needed for NbS each year from 20252050.This analysis assumes that current finance flows are committed to current projects and that future projects required to meet Rio Convention targets will require addi

288、tional finance.18 A protected area is a clearly defined geographical space that is recognised,dedicated and managed through legal or other effective means to achieve the long-term conservation of nature with associated ecosystem services and cultural values(UNEP WCMC 2016).19 Protection-related NbS

289、refers to NbS activities that avoid conversion and degradation of ecosystems.20 The UN Decade on Ecosystem Restoration frames restoration as activities to prevent,halt and reverse degradation.Restoration is based on a continuum of practices for rehabilitation and ecological restoration and includes

290、ecosystem management(WB 2022a).21 Sustainable land management in this report uses the WOCAT definition that has been agreed upon by governments through the IPCC Special Report on Climate Change and Land(WOCAT 2023):“The use of land resources,including soils,water,animals and plants,for the productio

291、n of goods to meet changing human needs,while simultaneously ensuring the long-term productive potential of these resources and the maintenance of their environmental functions”(WOCAT 2023).SLM in chapter 4 includes both conservation and regenerative agricultural practices.Annual financial flows to

292、NbS need to more than double by 2025(from US$200 billion to US$436 billion)and nearly triple to US$542 billion by 2030 to reach climate,biodiversity and land degradation targets.4.1.Annual investment needs and opportunitiesFigure 4.1.Additional annual investment needs to reach Rio targets,$billion(2

293、023 US$)7375424362022202520302050Current,200ReforestationRestoration of seagrassRestoration of saltmarshesRestoration of mangrovesRestoration of peatlandsAgroforestry-silvoarableAgroforestry-silvopastureCover cropsGrazing-optimal intensityAvoided mangrove conversionAvoided seagrass conversionProtect

294、ed areasAvoided peatland conversionAvoided grassland conversionAvoided deforestationProtectionSustainableLandManagementRestorationChapter 429The 16 NbS included in the analysis are grouped into three NbS types or categories sustainable land management,restoration and protection(Figure 4.1).While thi

295、s pragmatic grouping of NbS supports analysis and the development of policy recommendations,the distinction between restoration,protection and SLM is admittedly artificial,as there is significant overlap between categories.The five NbS treated as restoration(reforestation,restoration of peatlands,ma

296、ngroves,seagrass and saltmarshes)are those NbS that have the primary objective of restoration.However,some NbS classified here as SLM have restorative functions,for example,cover crops and improved grazing improve soil fertility and reduce erosion.Restoration can also occur in areas under protection

297、.Sustainable land management investment needs are based on the potential expansion of agroforestry(silvopastoral and silvoarable),covers crops and optimal grazing intensity practices.Its relative contribution to achieving environmental targets increases over time.Annual investment opportunities in S

298、LM increased fourfold from US$63 billion in 2025 to US$241 billion by 2050.The share of finance for SLM also increases over time relative to restoration and protection,with 27 per cent of additional NbS finance going to SLM in 2025,increasing to 45 per cent by 2050.As many NbS based on SLM generate

299、financial revenues,SLM provides an important opportunity for private investment and is thereby critical to scale NbS finance.Due to their relatively high cost,restoration NbS potentially require the highest levels of investment at US$125 billion per year by 2025 and over US$177 billion per year by 2

300、030.Three of the five types of NbS that will absorb the most finance are based on restoration:reforestation,seagrass and peatland restoration.Restoration can be costly due to high levels of inputs and the high opportunity costs of switching land use.For example,the costs of transitioning from cropla

301、nd to forest include the foregone financial returns from using the land for crop production.As a result,restoration may absorb over half of NbS finance each year until 2030.Of the additional US$342 billion needed annually by 2030 for NbS,protection-related NbS(including protected areas and avoided c

302、onversion of forests and other ecosystems)absorb US$66 billion(roughly 20 per cent of additional NbS finance).Additional finance for protection-related NbS needs to increase quickly from US$48 billion in 2025 to US$66 billion in 2030 as countries implement the 30 x30 target.Finance for protection-re

303、lated NbS includes the establishment of new protected areas and avoided conversion of key ecosystems,for example,avoided deforestation and degradation of peatlands and mangroves.Finance for protection is likely to remain roughly constant after 2030 once the 30 x30 target has been met.Quantifying the

304、 financial value of investment needed in NbS indicates the NbS that are likely to absorb most of the financing.To understand the physical scale of implementation of different types of NbS,Figure 4.2 provides an overview of the cumulative additional areas needed for protection,sustainable land manage

305、ment and restoration and how that evolves over time.Figure 4.2.Cumulative additional land area by NbS 20252050,Rio-aligned,Mha20003000400001000202520302035204020452050ProtectionSustainable Land ManagementRestorationChapter 430Protection-related NbS represent roughly 80 per cent of additional land ar

306、ea needed for NbS by 2030 while absorbing only 20 per cent of additional NbS finance due to its cost-effectiveness.Per hectare costs are significantly lower for protection than for restoration,which is,on average,six times more costly(Cook-Patton et al.2021).Protection is preferred if possible becau

307、se restoration is not consistently able to return ecosystems to their full function(Holl and Brancalion 2020)and may not yield the same biodiversity benefits as protection.Figure 4.3 The area under sustainable land management can expand significantly from 80 million hectares in 2025 to 335 million h

308、ectares by 2030 and 1.4 billion hectares by 2050.This expansion is based on improving the management of unsustainably managed lands and seas for food and commodity production.Converting areas of livestock production to optimal grazing is essential to ensure production of livestock products that mini

309、mises loss of biodiversity and GHG emissions due to ecosystem conversion.The area under improved grazing can potentially expand by a further 40 million hectares in 2025,reaching over 150 million hectares by 2030 and almost 600 million hectares by 2050.The area under agroforestry can potentially incr

310、ease from 27.5 million hectares in 2025 to 113 million hectares by 2030 and over 450 million hectares by 2050.The planting of trees in crop and livestock production systems supports the transition of food systems to more resilient diverse systems with livelihood,biodiversity and climate benefits.Cov

311、er crops provide a cost-effective means to indicates that to meet the 30 x30 target,land and seascape protection(including avoided conversion of forests,mangroves,peatlands and seagrass ecosystems)needs to rapidly increase to roughly 900 million hectares by 2025 and to 1.9 trillion hectares by 2030.

312、Figure 4.3 illustrates that protected areas are the dominant form of protection-related NbS,with avoided deforestation of a smaller but increasing importance after 2030.Once 30 per cent of land and seascapes are protected by 2030,further expansion of areas to be protected may slow.reduce soil erosio

313、n and promote soil fertility and biodiversity the 14 million hectares under cover crops by 2025 can expand to 65 million hectares by 2030 and 340 million hectares by 2050.While absorbing over half of annual NbS finance by 2030,the cumulative area under restoration(roughly 370 million hectares)is onl

314、y 9 per cent of total NbS area by 2050.Restoration NbS includes reforestation and peatland and mangrove restoration(saltmarsh and seagrass areas are very small).Figure 4.3 illustrates the dominance of reforestation in the restoration portfolio.Over time,the area dedicated to NbS restoration increase

315、s,while protection stabilises.This can be due to expected declines in the cost of restoration associated with higher carbon prices for reforestation and better technology.Restoration will be the“optimal”solution in some areas in the future due to,for example,its high carbon capture benefits.Figure 4

316、.3.Cumulative additional area by NbS category 20252050,Rio-aligned,MhaProtectionSustainable Land ManagementRestoration050020252030203520402045205020252030203520402045205020252030203520402045205015001000200025000500150010002000250005001500100020002500Protected areasAvoided deforestationAvoided grassl

317、and conversionAvoided peatland conversionGrazing-optimal intensityCover cropsReforestationRestoration of peatlandsAgroforestry-silvoarableAgroforestry-silvopastureAvoided mangrove conversionAvoided seagrass conversionRestoration of mangrovesNote:The land required for protected areas in this chart re

318、presents the estimated additional land required to meet 30 x30 targets and so does not include land currently under protection.Chapter 431Together,SLM and restoration NbS will cover 1.7 billion hectares by 2050.Restoration may also occur in protected areas,a potential overlap not currently modelled.

319、In short,this analysis provides very conservative estimates of investment opportunities for restoration NbS.Nevertheless,it is likely that the area dedicated to ecosystem restoration NbS will be smaller than protection NbS given the large difference in costs.As MAgPIE models the most cost-effective

320、land use given specific economic,environmental and policy constraints,lower cost protection and SLM are prioritised.Protection is prioritised by treating the 30 x30 target as an input into the model,which then optimises food production and carbon sequestration subject to a set of variables(populatio

321、n growth and diets,carbon price,etc).It is possible that the relative benefits of restoration are underestimated here.In Africa,NbS opportunities are predominantly protection-related and,therefore,financing needs appear to be relatively low.Baseline land use particularly high rates of deforestation

322、provides significant opportunities for cost-effective avoided deforestation through protection.Moreover,restoration is particularly high cost in Africa relative to protection due to the high opportunity cost of land driven by relatively rapid population and GDP growth.Under alternative scenarios,NbS

323、 finance needs in Africa may be higher given the high mitigation potential assessed in other studies(Roe et al.2021).To better target finance flows,the analysis looks at the regional distribution of investment opportunities.As noted,MAgPIE seeks the lowest cost land-use pathway that satisfies econom

324、ic,demographic and policy constraints.It optimises land use to satisfy multiple constraints,including urban growth,population growth,demand for food and materials and increasing carbon prices.It also accounts for existing commitments(NDCs,30 x30),baseline land use,opportunity costs and deforestation

325、 rate.While a range of factors helps to explain regional differences,three factors are particularly important:national commitments,baseline land use and the opportunity cost of land.4.2.Nature-based solutions finance needs by regionFigure 4.4.Additional NbS investment needs per year by region,Rio-al

326、igned,$billion(2023 US$)Middle East and Reforming EconomiesOceaniaNorth AmericaEuropeAfricaAsiaLatin America5412261524192521351174110716720320502030Chapter 432Modelling suggests that investment needs are likely to be greatest in Asia with an additional US$167 billion per year needed per year by 2030

327、,rising to US$203 billion per year by 2050(Figure 4.4).The Middle East and Reforming Economies and Latin America also absorb relatively high levels of NbS finance.With Rio alignment,NbS finance need is greatest in developing and emerging economies.Regions where NbS opportunities are predominantly pr

328、otection-related have a relatively low finance need.Cumulative additional investment needs are relatively high in Asia,at US$1,037 billion by 2030(Table 4.1).This is driven by ambitious restoration commitments in NDCs of some Asian countries.China has committed to plant 70 billion trees by 2030(WEF

329、2022c),and Indias NDC commits to expand forested land by 30 million hectares by 2030(Carbon Brief 2022).Table 4.1.Cumulative NbS investment needs by regionLargest NbS by land areaCumulative finance need by 2030(US$billion),Rio-alignedKey factsAgroforestryUS$30 billion investment required for agricul

330、ture NbSPotential of agriculture NbS recognised in Australias NDC,including soil organic carbon as a key mitigation measure(Rose et al.2022)71OceaniaAgroforestryUS$180 billion investment required for agricultural NbSRussia and Kazakhstan have highest crop and grassland carbon sequestration potential

331、(Rose et al.2022)323Middle East and Reforming EconomiesAsiaReforestationAgroforestryUS$430 billion for 170Mha of reforestation by 2050Consistent with reforestation ambition in Asia,e.g.Chinas commitment to plant 70 billion trees by 2030(WEF 2022)and Indias NDC committing to expand forested land by 3

332、0Mha by 2030(Carbon Brief 2022)1,037ReforestationUS$60 billion investment needed to reforest 100Mha by 2050Requires significant scale-up from current commitments,e.g.Brazilian commitment to reforest and restore 18Mha by 2030(Simpkins et al.2022)238Latin AmericaAvoided deforestationProtected areasInv

333、estment required is primarily into low-cost protected areas and avoided deforestationNbS expansion is constrained due to competition from urban expansion and conventional agriculture128AfricaAgroforestryUS$40 billion investment required for agriculture NbSAligns with EU Soil Strategy for 2030 and proposed EU Soil Health Law(European Commission 2022)111EuropeProtected areasAgroforestryUS$40 billion