BIOFIN in Chile seeks to transform finances to manage biodiversity through the design of a financial strategy which mobilise, optimise and reallocate public and private resources to implement the National Biodiversity Strategy (NBSAP) 2016-2030. This goal will be reached through the strengthening of the capacities on biodiversity planning, the development of information baselines about expenditures on biodiversity and costs of the NBS, the estimate of financing requirements, and the design of pilot projects which can locally test economic instruments or mechanisms to manage biodiversity. BIOFIN Chile has its own dynamic website - Learn more there https://biofinchile.cl
Prioritised Finance Solutions
- Contributions to the national biodiversity compensation system (offset)
- Clean Production Agreements including biodiversity concerns
- Optimization of sub-national investment through green infrastructure projects
- Climate Green Fund to finance priorities of the National Biodiversity Strategy
The Law Nr. 20.417, which created the Ministry on Environment and its staff, improved the capacities of the institutions with respect to biodiversity. However, this is a recent institution. This, added to the small budgets compared to those allocated to productive development policies, whose practices affect biodiversity, shape a complex setting to mitigate damage and loss trends of the natural capital. Some barriers to finance biodiversity management are: institutional weaknesses; lack of technical capacities, of regulations on biodiversity protection, and of methodologies; minor implementation and diversification of economic instruments; among others.
Chile doesn’t have an environmental classifier meeting international standards, appropriate to analyze expenditures associated to biodiversity. This information is scattered among the different public services and its classification does not follow biodiversity criteria. There aren’t measurements for the private sector either. The analysis made by BIOFIN Chile with respect to the budget of the central government for the period 2010-2014 states that the expenditure on biodiversity reaches an average of 0.0295% of the GDP. This is 0.12% of the public budget.
The economic resources needed to implement the National Biodiversity Strategy (NBSAP) 2016-2030 totalize USD 943,993,620 (based on USD prize in 2015). The annual average is USD 72,614,894, which is equivalent to approximately 0.025 of the GDP for the year 2019. This quantity is additional to the State’s current expenditure. It is concluded that there is a significant gap between the public expenditure and its trend (Business As Usual), and the required resources to finance the National Biodiversity Strategy, which contains the national priorities for the management of biodiversity aligned with Aichi Goals.
Biodiversity financing requires changing the current logic of Business As Usual (BAU), directing the abundant economic assets available in the national economy and its public budgets to create an enabling environment, which would allow the protection and management of Chile’s natural capital and its eco-systemic services. There are resources, but those must be properly directed. This means reducing and/or eliminating institutional, politic (and behavioural), market, regulative and financial barriers which obstruct its financing.
The financial strategy for the NBS favours collaborative management among public services, the civil society and the private sector, in order to optimize, reallocate and combine various economic instruments which allow enhancing the investment on biodiversity. This is accompanied by a political strategy which contributes to the institutionalization of results, beyond the end of the project, drawn from the collaboration of public services participating in the project committees (Directive and Technical); and a range of communicational and political milestones with public and private actors. Currently, work is focused on contributions to the Compensation System and to add biodiversity concerns to Clean Production Agreements with the private sector.