The Covid19 pandemic is a systemic global phenomenon that is having a profound impact on the economy, health (obviously), nature and our social lives. Over the course of the last several weeks, CFA members participated in two online discussions creating the CFA Online Discussion Series. The aim of the Series is to bring together members and partners to better gauge the challenges and opportunities brought on by the crisis, specifically with regards to conservation finance.
In the first discussion, we primarily examined the impact of Covid-19 on Conservation Trust Funds. Key speakers included Karen Price (CAFÉ) and Zdenka Piskulich (RedLAC), James Money-Kyrle (The Good Economy), Thierry Renaud (MAVA Foundation), Constance Corbier-Barthaux (FFEM), and Melissa Moye (WWF).
In the recently concluded second discussion, held on May 11, we broke the session into two sections – the first focused on reviewing how the range of conservation finance mechanisms were being affected by the coronavirus including a rapid online survey. We will share the main conclusions below and we will provide a more detailed analysis shortly. As well, we heard from Simon Zadek (Vivid Economics) who discussed how conservation targets might be integrated into debt relief mechanisms in light of expected sovereign debt challenges.
As noted above, valuable information was generated through an interactive survey administered during the discussion on which finance instruments were assessed by members in terms of their relation to Covid19. A few conclusions of this survey are provided below.
First – almost all conservation finance mechanisms are perceived as being negatively impacted by the Covid19 pandemic. This is not surprising as this is an unprecedented system-wide phenomenon that is depressing the global economy and the economy of almost every business sector. Since governments rely on sales taxes and individual and business income taxes for budgets and to pay back sovereign debt, most governments are under severe financial stress.
Second – Finance mechanisms related to tourism are being especially hit hard. Tourism has virtually stopped globally. This is especially problematic for certain protected areas and countries that have come to heavily rely on nature-based tourism for financing conservation and for jobs.
Third – Four types of finance mechanisms stand out as being potentially positively impacted and could present interesting opportunities in the future. These are:
Sustainable Finance Strategies
Blended Finance (which includes Debt Conversion)
Public Private Partnerships
Mainstreaming Biodiversity in Development.
For background on these mechanisms see the CFA white paper: Conservation Finance: A Framework.The CFA will organize the next set of discussions on these types of mechanisms and provide a technical note that includes additional resources – look for more information next week. Please visit the Online Discussion Series page on the CFA website for a detailed review of the previous two discussions. We want to thank all the speakers as well as the participants for contributing to such interesting and insightful debate and conversation.
Author: David Meyers, Executive Director, Conservation Finance Alliance
Date: May 2020