Scaling Up Nature-Based Solutions

In Southeast Asia, the loss of forest cover, the drainage of wetlands and the decline in biodiversity underscore the pressing need for enhanced conservation efforts. The region’s vulnerability to rising sea levels and extreme weather events further highlights the importance of integrating a new plan of action into broader climate strategies. 

This plan goes by the name of nature-based solutions (NBS). These actions are increasingly recognized as vital tools in addressing the twin crises of climate change and biodiversity loss. Defined broadly, NBS encompass actions that protect, sustainably manage and restore natural ecosystems, providing not only environmental benefits but also socioeconomic advantages. These solutions are critical in building climate resilience, with ecosystems like forests, wetlands and oceans playing key roles in carbon sequestration and temperature regulation. 

The Nature Solutions Finance Hub: A Vision for the Future 

To address this key issue, a new mechanism was needed. In December 2023 at COP28 in Dubai, the Nature Solutions Finance Hub was inaugurated by the Asian Development Bank (ADB) and the OPEC Fund. The hub is a platform that combines innovative finance approaches with policy support, capacity building and the development of bankable NBS projects. The overarching objective is to catalyze at least US$5 billion in capital flows into NBS projects across Asia and the Pacific, with a minimum of 15 percent sourced from the private sector. 

In April 2024, the Nature Solutions Finance Hub held its first Partners Forum, which underscored the urgency of mobilizing finance for nature-based solutions across Asia and the Pacific. Hosted by the OPEC Fund at its Headquarters in Vienna, with key partners including the ADB, the event was more than a mere meeting; it was a clarion call for collective action to bridge the substantial financing gap in NBS and to promote sustainable development across the region. 

During the Forum, OPEC Fund President Abdulhamid Alkhalifa emphasized the hub’s role in mobilizing the much-needed funding for NBS, calling the method an effective way to tackle two key issues, mitigating climate change and conserving biodiversity, at the same time. He also stressed the need for overcoming policy barriers, scaling up investment and stressed the OPEC Fund’s full commitment to mobilizing resources and fostering collaboration to advance NBS initiatives. 

Key Takeaways from the Forum 

Several key speakers at the Partners Forum provided valuable insights and guidance on the way forward: 

•  OPEC Fund Vice President Shaimaa Al-Sheiby emphasized the pivotal role of NBS in addressing global challenges such as climate change and biodiversity loss. She underscored the importance of concerted efforts and knowledge sharing for the effective implementation of NBS. Al-Sheiby also highlighted the establishment of a South-South hub, designed to foster collaboration and deliver benefits to marginalized communities. The OPEC Fund’s role in providing Technical Assistance (TA) was particularly noted, with strong relationships with the Arab Coordination Group (ACG) and the International Fund for Agricultural Development (IFAD) seen as critical to advancing NBS initiatives. She reaffirmed the OPEC Fund’s commitment to sustainable development through NBS and called for additional collaboration and investment to ensure a resilient future. 
• Anouj Mehta, Country Director of the Thailand Resident Mission at ADB, stressed the urgent need for innovative financial instruments and highlighted the critical role of governments in scaling up finance for NBS. Mehta pointed out the imperative of catalyzing at least US$5 billion by 2030 from both public and private sources into NBS projects. He addressed the challenges of balancing private and public capital while transitioning towards scalable initiatives, emphasizing the importance of strong governmental and institutional support. 
• Warren Evans, ADB Special Senior Advisor on Climate Change, highlighted the need to move from words to deeds. He advocated for working at scale rather than focusing on small, isolated initiatives. Evans emphasized the importance of leveraging innovative financial instruments and ensuring that the hub supports two to three exemplary NBS projects that can serve as showcase for the hub’s effectiveness. These projects, he argued, would be critical in demonstrating the practical viability and impact of NBS initiatives. 
   

Challenges and Opportunities 

While the potential benefits of NBS are immense, several challenges limit their widespread adoption. These include a lack of national and regional focus, insufficient scalable projects and weaknesses in project preparation. Moreover, there is a notable gap in knowledge regarding innovative finance approaches that could attract private capital to NBS initiatives. To address these challenges the Nature Solutions Finance Hub aims to act as an incubator for high-impact projects, providing the necessary support to bring them to financial closure. By pooling global resources and leveraging ADB’s expertise the hub seeks to create a conducive environment for NBS to thrive, thereby ensuring that nature conservation efforts are both impactful and sustainable. 

A Call to Action 

The hub represents a bold step forward in the global effort to combat climate change and biodiversity loss. By bringing together a diverse range of stakeholders and focusing on innovative finance mechanisms, the hub aims to unlock the potential of NBS at scale. As the hub moves forward, the continued collaboration and commitment of partners will be crucial in turning vision into reality. 

With the stakes higher than ever, the work of the Nature Solutions Finance Hub is not just timely – it is essential. The outcomes of the April 2024 Partners Forum make it clear that while challenges remain, the path forward is filled with opportunity. In order to ensure there is a sustainable and resilient future for all, now is the time for governments, financial institutions and private sector players to rally behind nature-based solutions. 

In their own words... 

“The future will no longer be about fuels. The future will be about the technology we use to harness the inputs from the environment – sun, wind, geothermal and hydropower. Innovation is how to use this technology and how to make the grid more interconnected, flexible and balanced. It is about how to make a decentralized system work in an orderly way.”  - Francesco La Camera, Director-General, International Renewable Energy Agency 

“A century ago people were asking whether everybody would have access to electricity – and now most countries have achieved universal access to electricity. So we believe it’s achievable to have universal access to clean cooking solutions just as it’s possible to have universal access to electricity in Africa, Asia and worldwide. Of course it’s achievable.” - Kandeh Yumkella, Former UN Under- Secretary General 

“We’re dealing with a ‘Rubik’s Cube’ situation where we need to look at things from the point of view not only of the environment, but also the economy. The social aspects and socio-economic considerations also have to be taken into account. We have to take an approach thinking about the intended and unintended consequences of policy action. The social license for governments to act is critical.” - Jo Tyndall, Director, OECD Environment Directorate 

“The fight against climate change will be lost or won in the Global South. So now is the time for action.” - Francis Elisha, Africa Director, Rocky Mountain Institute 

“Financing nature-based solutions and more generally speaking, financing nature, requires a complete change of mindset. We need to look at how our economies are damaging nature, while bearing in mind that about half our global GDP depends on nature.” - Mathilde Bord- Laurans, Head of Climate Change and Nature, French Development Agency 

“If you’re going to attract more finance, you need to think about outcomes in nature and how they can be valued, too. If you look at the stocks of biodiversity in the world, they tend to be often in the Global South. These are quite complex territories and risk is high – but the risk of not addressing the challenges is going to be even higher.” - Giles Davies, Founder and Chairman, Conservation Capital