New global biodiversity fund launches with Canada, UK pledges

Less than a year after 190 countries reached a Paris Agreement-style accord on how to protect the world’s natural habitats, a new fund was launched to finance the developing world’s biodiversity needs, with Canada and the United Kingdom providing the first pledges, though falling short of the minimum amount to make the fund operational. Member countries ratified the creation of the Global Biodiversity Framework Fund at the seventh Global Environment Facility, or GEF, Assembly in Vancouver on Thursday as wildfires raged in British Columbia and smoke blanketed the city, underscoring ongoing threats from climate change to the natural world. Canada also hosted the COP 15 talks in December that produced the 23-target agreement known as the Kunming-Montreal Global Biodiversity Framework, which calls on signatories to conserve 30% of their lands and waters by 2030. Meeting those targets will require environmental development financing, and Canada led the charge with a pledge of CA$200 million (US$147 million). The U.K. gave £10 million ($12.6 million) as a “down payment,” while Japan signaled a money was forthcoming. The numbers exceed expectations for a fund approved just two months ago by the GEF Council, but falls short of the $200 million necessary to operationalize in the World Bank. GEF chief executive Carlos Manuel Rodríguez cautioned that fervor to create the fund may mean donor countries are still working out budgets. “We were able to put the fund in place even before the donor nations go through their internal domestic fiscal processes — they need to go to congresses and ministers of finance,” Rodríguez told Devex at a press conference. Donors will have to reach deeper into national treasuries, however, to stay on track with the financing targets in the Kunming-Montreal Global Biodiversity Framework, which call for $20 billion by 2025. “Next year we will be in a capitalization mode,” said Rodríguez, Costa Rica’s former environment minister. Rodríguez has the wind at his back as he stumps for the new biodiversity fund. Since taking over 32-year-old GEF in 2020, he has secured a record $5.33 billion in donations for its current 2022-2026 budget cycle, including some $2 billion allocated to biodiversity. Now he must turn that fundraising prowess to the new biodiversity-specific fund as he canvasses other top GEF donors such as Germany, Sweden, and the United States on a tight timeline — Rodríguez wants the first funding out the door by June so that there is evidence of on-the-ground impact by the next biodiversity conference, COP 16, later in 2024. “It’s going to be difficult given the fiscal pressures that countries face, but it’s very clear that if we want to achieve the incredibly ambitious targets in the framework, then countries are going to need support,” Convention of Biological Diversity Executive Secretary David Cooper told Devex. “There’s an understanding among donors that this is what’s needed. We’re going to need a significant amount of money quite quickly.” Speed is among Rodríguez’s hallmarks as GEF seeks to streamline the funding process to 12 months, down from 18-24 months, without losing key safeguards against corruption and mismanagement. For starters, the new fund will operate with a one-step application, doing away with the project identification form, or PIF, currently required to access GEF funding. Such maneuvers are designed to avoid the pitfalls of similar money pots such as the Green Climate Fund, criticized for bogging down projects in bureaucracy. “We live in a financial ecosystem that is highly fragmented, heavily intermediated and isn’t delivering the money at the speed or to the people where it’s needed when it’s needed,” World Bank Global Director for Environment, Natural Resources and Blue Economy Valerie Hickey told Devex. “The paperwork has to be streamlined and simplified. We have paperwork under the existing GEF family of funds and other specialized environmental agencies that are highly obtuse, even for someone like me. We can’t be adding onerous asks of countries, particularly small islands and least developed countries, who are the people and the places where this money is most needed and can have the greatest impact.” Civil servants from multiple recipient countries told Devex that easier applications across the environmental funding arena would be a welcome relief as they struggle to keep up with a time- and money-intensive schedule of global meetings and conferences as well as lengthy applications to fund conservation projects. With the new fund, they may get their wish. “We are testing new processes and approaches that will eventually trickle up into the big funds that we have at the GEF,” Rodríguez said. The multilateral institutions involved may also change. Under the existing model, recipient countries are allocated a set amount and 18 agencies are accredited to access that funding for in-country projects and programs. Historically, the U.N. Development Programme, U.N. Environment Programme, and U.N. Food and Agriculture Organization have dominated, accounting for nearly 70% of programming in the current GEF funding cycle. However, under the new biodiversity fund, international financial institutions are expected to receive 25% of the funding. That means players such as the World Bank — where GEF is housed—, the Asian Development Bank, and the Inter-American Development Bank, among others, will shoulder a larger share of biodiversity financing. The new fund marks a change from business-as-usual at GEF in other ways. Philanthropies and the private sector are invited to contribute, though none made pledges on the day of the fund’s ratification. Rodríguez is also keen to see nonstate actors take a larger role. To that end, another 20% of the biodiversity fund will likely be allocated to indigenous peoples, whose traditional land and water management practices are often at the forefront of biodiversity solutions, although how much will be routed through implementing agencies versus allocated directly to indigenous communities without intermediaries remains to be seen. “Indigenous communities, with their generations of land stewardship and fire management expertise, hold the key to preventing catastrophic wildfires and other environmental contingencies,” said Colombian indigenous leader Darío José Mejía Montalvo, chair of the U.N. Permanent Forum on Indigenous Issues, in a statement. “Despite their unparalleled understanding, they continue to be underfunded and overlooked.” With the clock ticking to get the fund off the ground, the environmental and human rights advocacy group Avaaz was less impressed with the results on the fund’s opening day. “Surely donors can come up with the paltry $40 million needed to operationalize the Global Biodiversity Framework Fund today,” Avaaz campaign director Oscar Soria said in a statement.