(Bloomberg) -- This year’s biodiversity talks — known as COP16 — were dubbed at the outset as a chance to implement protections. At the midpoint, they’ve become a “COP of encouragement,” Astrid Schomaker, executive secretary of the United Nations Convention on Biological Diversity, said in a stocktake press conference on Friday.
Still, she assured reporters at the United Nations Biodiversity Conference in Cali, Colombia, that progress is being made. Susana Muhamad, Colombia’s environment minister and COP16 president, described the negotiations as “constructive.” But progress remains painstakingly slow on a number of fronts.
“We still have a lot of ground to cover before we can reach consensus, and things may also go wrong because some of the differences in opinions between parties are actually quite fundamental,” said the European Union’s lead negotiator Hugo Schally.
Financing ecosystem protection
Mobilizing more funds to protect nature is proving to be “one of the most difficult issues” with “very different” views among countries, Muhamad said. Since Monday, country negotiators have split off into groups to work through the wording of a draft text on how to raise and distribute more money.
One point of contention is how, exactly, to close the multi-billion-dollar biodiversity finance gap. Developed countries are pushing to include all sources of finance, including private capital, said Tom Picken, director of forests and finance at the Rainforest Action Network and an observer to the negotiations. Developing countries, meanwhile, are pushing for an emphasis on grants because already heavy debt burdens mean that taking on more liabilities is infeasible. “Tensions are palpable,” said Picken.
The second issue is how to channel the funds raised. Brazil and African nations are pushing for a new, dedicated fund overseen by the UN conference of parties. The European Union and other developed countries want to work with what exists — the Washington, DC-based Global Environment Facility’s Global Biodiversity Framework Fund — and to make it more efficient. Another option is to defer a decision to the next summit in 2026.
“Countries remain far apart in their positions on the best way forward,” Bernadette Fischler Hooper, head of global advocacy at WWF International, said in a statement on Friday morning.
Combatting ‘biopiracy’
Progress on a mechanism for sharing the proceeds with host countries from companies’ use of digitized genetic resources has also been slow. Whether the instrument will be binding and who might be exempt — for example, academic researchers or smaller companies — are key flashpoints, Nithin Ramakrishnan, senior researcher at Third World Network and an observer to those negotiations, said on Thursday.
Setting national plans
Meanwhile, of 196 countries that signed the 2022 pact to halt and reverse nature loss by 2030, just 34 and the EU met the Monday deadline to submit national plans for how they’ll meet its goals. For bankers present, the lack of national plans is a major shortcoming.
“We're at the point where countries haven't identified where their priorities are,” said Abyd Karmali, managing director of climate finance at Bank of America. As a result, “private capital doesn't have a good roadmap into where it could be deploying capital.”
“The private sector acts with direction from governments,” said Thomas Viegas, nature strategy lead at Aviva. Currently “there’s little to go on,” he said.
Biodiversity credits
Perhaps the hottest topic of the week is biodiversity credits, tradeable instruments akin to carbon credits that represent a unit of biodiversity uplift instead of a ton of reduced emissions. The market for credits is under $1 million, according to data compiled by BloombergNEF. But there have been more side events on the topic than any other. Meeting rooms have been overflowing, but there’s a fierce debate over the concept of trading credits to protect nature.
Standards groups have presented integrity principles, but nonprofits have been strongly resistant to what they see as a “false solution.” In side meetings, meanwhile, businesses have been rallying demand for credits they’re already marketing.
For Oliver Withers, head of nature at Standard Chartered, the level of contention in the nature finance space is unhelpful. “We lack consensus from this community,” he said. Financial institutions are pressed to “put their heads above the parapet and do innovative things, but then parts of this community will accuse us of doing the wrong thing. We need to remove greenwashing risk as a reason for not doing deals,” he said.
The latest reports suggest that Brazil’s President Lula won’t be attending the summit due to health issues, contrary to earlier indications. Muhamad said that this is the largest biodiversity COP on record with over 20,000 delegates registered to attend the formal summit in the so-called “blue zone” and more than 40,000 people attending the informal “green zone” gathering.
(Adds quote fromHugo Schally in paragraph 3.)
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