Goal 15: Life on Land

SDG_15_sdfinance

View Goal 15 Targets

Sustaining life on land means preserving and restoring terrestrial biodiversity and ecosystems such as forests, wetlands, grasslands, drylands and mountains by halting deforestation, fragmentation and overgrazing and reversing desertification and land degradation. Terrestrial ecosystems–comprising roughly 30 percent of the planet’s surface–provide us with sources of water, food, fuel, shelter and medicine, help mitigate carbon emissions and help us to adapt to the impact of changing climate. For example, more than 1.6 billion people directly depend on forest biodiversity and ecosystem services for their livelihoods, which also underpin the health and resilience of all our economies and societies.

Progress in preserving and sustainably using the Earth’s terrestrial biodiversity and ecosystems has been slow. Although areas that are under protection or under sustainable management have increased, pressure on biodiversity and ecosystems, such as habitat loss, degradation, poaching and wildlife trafficking and pollution, has increased exponentially.  We are losing species at a rate at least 1,000 times fasterthan the natural rate. We have lost over 130 million hectares of rainforests since 1990 and we lose dozens of species every day, pushing the Earth’s ecological system towards its limit. Between 1998 and 2013, about 20 percent of cultivated land showed persistent and declining trends in productivity, placing the lives of 1 billion people under threat.

The economic costs of ongoing biodiversity loss and ecosystem degradation are high. For example, insects and other pollen-carriers are estimated to be worth more than US$200 billion per year to the global food economy. Recent surveys suggest, however, that significant declines are occurring in many insect populations. More than 12 million hectares of land are lost to drought and desertification each year, which, if managed more sustainably, could produce 20 million tons of grain, enough to feed 40 million people for one year.

Financing Life on Land

The earth’s soil provides over US$16 trillion worth of ecosystem services each year. Three quarters of the top global commercial prescription drugs contain components derived from plants. However, ecosystems and biodiversity values are not internalized by markets, nor are the costs of biodiversity and ecosystem loss reflected in prices. Similarly, public budgets often overlook the economic potential and negative risks associated with underfunding biodiversity and conservation. Average biodiversity expenditures as a share of total government expenditures range from as low as 0.16 percent to just 1.8 percent, according to the Biodiversity Finance Initiative (BIOFIN).   

Much greater investments are needed to maintain, protect, and restore our Earth’s valuable biodiversity and ecosystem services. For example, achieving sustainable forest management on a global scale would cost US$70-US$160 billion per year. An additional US$150-US$440 billion per year is required to halt the loss of biodiversity by the middle of this century. To fill this financing gap, countries need to mobilize a mix of public and private, domestic and international resources. At the same time, they need to be provided with adequate incentives and support to join global efforts to conserve our shared natural resources.

These investments can be primarily achieved with increased public budgets, reforms featuring green taxes and the phasing out of harmful subsidies, and Official Development Assistance (ODA). ODA can play an important role in catalysing and crowding in private investments in conservation, which make up only a small share of financial markets. Success in attracting private capital to conservation, including through green bonds and impact investment vehicles, could help transform the financing landscape for SDG 15.

Mechanisms and strategies are numerous. Debt-for-nature swaps, where a creditor forgoes receiving a portion of its debt repayments on the condition that they are invested in ecological projects, can be revamped. Pricing mechanisms—such as payments for ecosystem services—provide incentives for communities to preserve and manage natural assets and can be multiplied and scaled up. Ecological fiscal transfers can introduce conservation indices (e.g. the size/quality of protected areas) as part of the fiscal allocation formula to reward investments in conservation.

Financing Solutions Related to SDG 15

The solutions listed below provide a wide range of finance options to increase the resources that can help sustain our terrestrial legacy. These solutions do not however constitute an exhaustive or comprehensive list of financing options for SDG 15. For a more comprehensive set of solutions, please visit the BIOFIN catalogue.

  • Biodiversity Offsets

    Measurable conservation outcomes resulting from actions that compensate for significant residual adverse biodiversity impacts arising from development projects.

  • Bioprospecting

    Systematic search for biochemical and genetic information in nature in order to develop commercially-valuable products and applications.

  • Crowdfunding

    Approach for projects, organizations, entrepreneurs, and startups to raise money for their causes from multiple individual donors or investors.

  • Debt for Nature Swaps

    Agreement that reduces a developing country’s debt stock or service in exchange for a commitment to protect nature.

  • Disaster Risk Insurance

    Disaster risk insurance schemes cover—against a premium—the costs incurred by the insured entity from extreme weather and natural disasters.

  • Ecological Fiscal Transfers

    Integrating ecological services means making conservation indices (e.g. size/quality of protected areas) part of the fiscal allocation formula to reward investments in conservation.

  • Enterprise Challenge Funds

    Funding instrument that distributes grants (or concessional finance) to profit-seeking projects on a competitive basis.

  • Green Bonds

    Bonds where proceeds are invested exclusively in projects that generate climate or other environmental benefits.

  • Impact Investment

    Investments made with the intention to generate a measurable social and environmental impact alongside a financial return.

  • Lotteries

    Governments and civil society groups use lotteries as a means of raising funds for benevolent purposes such as education, health, preservation of historic sites and nature conservation.

  • Payments for Ecosystem Services

    Payments for ecosystem services (PES) occur when a beneficiary or user of an ecosystem service makes a direct or indirect payment to the provider of that service.

  • Social and Development Impact Bonds (Results-Based Financing)

    A public-private partnership that allows private (impact) investors to upfront capital for public projects that deliver social and environmental outcomes in exchange for a financial interest.

  • Taxes on Fuel

    The sale tax any individual or firm who purchases fuel for his/her automobile or home heating pays. Fuel taxes can reduce the consumption of fossil fuels and greenhouse gas emissions while generating public revenues.

  • Taxes on Pesticides and Chemical Fertilizers

    Taxes on certain pesticides and chemical fertilizers can mobilize fiscal revenues while mitigating the negative effects associated with pesticide/fertilizers application and promoting sustainable agriculture practices.

  • Taxes on Renewable Natural Capital (water; timber)

    Any fee, charge or tax charged on the extraction and/or use of renewable natural capital (e.g. timber or water).

  • Voluntary Standards (finance)

    Standards applicable to the financial sector that capture good practices and encourage the achievement and monitoring of social and environmental outcomes.

Latest blogs

  • Impact investment to close the SDG funding gap

    A look at the current state of development funding shows a stark contrast between the price tag to eliminate poverty and protect the planet by 2030, and the actual financial resources that are available. Impact investing can close this gap.Read more 

  • What does ‘risk-informed’ development finance really look like?

    How to tackle various forms of risk – from extreme weather events to commodity price shocks, disease outbreaks and over-indebtedness – was high on the agenda of the 2017 Financing for Development (FfD) Forum at the UN. it is unsurprising there is renewed interest in financial instruments and innovations designed to reduce vulnerability to risk – and to help countries cope when crises occur.Read more 

  • Not just more, but better – effective financing of the SDGs

    Bankrolling sustainable development cannot happen through global financing agendas alone, but should instead be built from a bottom-up, holistic and context-driven approach. As countries strive to manage increasingly complex financing flows at the national level, as domestic public and private resources increase, and as the sources of external resources diversify, we need urgent and targeted solutions.Read more 

  • Dollars and 'sense': Paying for our planet

    As it is the International Year of Sustainable Tourism, it is worth noting the role biodiversity and ecosystems play as the backbone of tourism in many places, and the crucial role that the tourism sector can play in conserving biodiversity. This is undeniably a nexus to pursue, particularly for financing effective conservation. Read more 

  • To leave no one behind, Least Developed Countries need new financing tools

    Current domestic resources and ODA combined will be insufficient to finance the 2030 Agenda. Against this background, the 48 Least Developed Countries’ abilities to harness and make effective use of a broader suite of financing instruments to fund their sustainable development becomes a development imperative.Read more 

More blog posts