27 May 2021
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3 min read
Far more investment is needed in restoring nature to hit climate goals, according to the UN | Credit: iStock
Fourfold rise in investment needed for efforts restore the natural world while also mitigating greenhouse gases and climate impacts, UN warns
As much as $8.1tr global investment in protecting, conserving and restoring the natural world is required over the next 30 years in order to tackle the interlinked climate, biodiversity and land degradation crises, with annual finance needing to triple by 2030, according to the UN-led study.
In a major stock-take of the finance needed to restore biodiversity while also enhancing the ability of nature to store carbon and mitigate the impacts of the changing climate released today, it estimates annual investments in nature-based solutions will need to reach $536bn per year by 2050.
That means annual investments would need to triple by the end of the decade and increase fourfold by 2050 from current levels, which stood at around $133bn a year in 2018, of which private finance made up only a fraction at $18bn, it said.
The report therefore stresses the need to rapidly accelerate capital flows towards so-called nature-based solutions by making nature central to public and private sector decision-making, noting that nature only currently only accounts for 2.5 per cent of projected economic stimulus spending in the wake of the Covid-19 crisis.
But structural transformations are urgently needed to close the estimated $4.1tr gap in finance needed between now and 2050, it warns. In addition to focusing pandemic-recovery investments on environmental sustainability, it calls for a shift away from harmful agricultural and fossil fuel subsidies towards instead creating new economic and regulatory incentives to invest in nature.
UNEP executive director Inger Andersen said the findings should act as a "wake-up call" for governments, financial institutions and businesses to invest in nature, such as through reforestation, regenerative agriculture and restoration of the world's oceans.
Biodiversity loss alone is already costing the global economy as much as 10 per cent of its output every year, Andersen warned, as she called on global governments to seize the opportunities of the crucial COP15 and COP26 summits on biodiversity and climate change respectively to drive ambitious action and investment towards tackling these interlinked planetary crises.
"If we do not sufficiently finance nature-based solutions, we will impact the capacities of countries to make progress on other vital areas such as education, health and employment," she warned. "If we do not save nature now, we will not be able to achieve sustainable development."
The UN Environment Programme (UNEP) produced the study alongside the World Economic Forum and the Economics of Land Degradation (ELD) Initiative hosted by the German Federal Ministry for Economic Cooperation and Development and UK consultancy Vivid Economics.
It comes amid growing interest in nature-based solutions to climate change and reversing biodiversity loss in the corporate world, awareness of the supply chain risks businesses face from environmental degradation grows, and more firms seek to decarbonise in line with net zero goals.
The management, conservation and restoration of forests alone is likely to require around $203bn in total annual expenditure globally, the equivalent of just over $25 per year for every citizen on the planet in 2021, it states.
Yet such by coupling investments in restoration with conservation measures, it estimates the area of the planet covered by forest and sustainable food production could increase by around 300 million hectares by 2050 compared to today.
At present, however, private sector investment only makes up 14 per cent of the global total finance towards nature-based solutions, and scaling up this investment is one of the central challenges of the next few years, according to the UN.
It said investors, developers, market infrastructure makers, customers and beneficiaries would all have key roles to play in creating a credible market for nature-based solutions to access new sources of revenue, while helping to improve cost efficiencies for companies.
"While investments in nature-based solutions cannot be a substitute for deep decarbonisation of all sectors of the economy, they can contribute to the required pace and scale of climate change mitigation and adaptation," the UN said.
The findings emerged as a host of leading experts, business leaders, environmental organisations came together to discuss the challenges and opportunities of marrying climate action with reversing nature loss at BusinessGreen's inaugural Net Zero Nature summit today.
