TWN Info Service on Biodiversity and Traditional Knowledge (Jan23/02)
9 January 2023
Third World Network

CBD COP15: Failure to establish a dedicated Global Biodiversity Fund despite call by more than 70 developing countries

Kathmandu, 9 January (Prerna Bomzan) – The 15th meeting of the Conference of Parties (COP15) to the Convention on Biological Diversity (CBD) failed to establish a dedicated Global Biodiversity Fund. This had been the demand of more than 70 developing countries during the course of heated negotiations on the crucial agenda of financial resources.

The CBD’s COP15 met in Montreal, Canada, from 7 to 19 December, in conjunction with the meetings of Parties to its Protocols – the Cartagena Protocol on Biosafety (COPMOP10), and the Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilization (COPMOP4).

The finance decision under COP agenda item 12A on “Resource Mobilization” was furthermore adopted amidst controversy as part of a package, despite objections raised by the Democratic Republic of Congo (DRC), since the dedicated Global Biodiversity Fund was not part of the key outcomes of COP 15. (See ‘New implementation framework for Biodiversity Convention adopted’, 28 December 2022.)

[A new, dedicated Global Biodiversity Fund was first proposed by a like-minded group of developing countries on biodiversity and development (LMG) in March 2022 in Geneva when in-person negotiations resumed. The other key demand of the LMG was for developed countries to commit to a goal of mobilizing and providing at least USD100 billion annually initially and rising to USD 700 billion annually by 2030 and beyond, which was also not met in Montreal.

The LMG initially included the African Group, Antigua and Barbuda, Argentina, Bolivia, Brazil, Cuba, the Dominican Republic, Ecuador, Guatemala, India, Pakistan and Venezuela. By COP 15, Haiti, Indonesia, Malaysia, Paraguay and the Philippines joined the LMG – led by Brazil – which further evolved into a broad coalition of more than 70 developing countries firmly supporting the demand for a new, dedicated Global Biodiversity Fund under the authority of the COP in accordance with Article 21 of the CBD.]

The final decision (CBD/COP/15/L.29) on “Resource Mobilization” contains instead a limited “Global Biodiversity Framework Fund (GBF Fund)”, in the form of a “Special Trust Fund to support the implementation of the Global Biodiversity Framework”. Paragraphs 29-39 of the decision elaborate on the GBF Fund.

Paragraph 30 reads, “Requests the Global Environment Facility to establish, in 2023, and until 2030 unless the Conference of the Parties decides otherwise, a Special Trust Fund to support the implementation of the Global Biodiversity Framework (“GBF Fund”), to complement existing support and scale up financing to ensure its timely implementation, taking into account the need for adequacy, predictability, and the timely flow of funds”.

Paragraph 31 reads, “Requests the Global Environmental Facility to prepare a decision to be considered by the Council on the approval of a GBF Fund, with its own equitable governing body, to be dedicated exclusively to supporting the implementation of the goals and targets of the post-2020 global biodiversity framework”.

The adopted GBF Fund is therefore under the authority of the Global Environment Facility (GEF), which is actually an interim financial arrangement (Article 39 of the CBD), while the long overdue mandate is to create a financial mechanism under the authority and guidance of the COP (Article 21 of the CBD).

Moreover, the GEF, as experienced by developing countries, is substantially under- resourced and coupled with other focal areas in its portfolio such as climate change. Hence, GEF resources are clearly not commensurate with the biodiversity financing gap estimated to be around USD 700 billion per year. In addition, access to GEF is another fundamental issue, among other structural concerns.

The adopted GBF Fund primarily reflects the proposal by Colombia, Chile, Costa Rica, Mexico and Peru that were calling for a dedicated biodiversity Trust Fund under the GEF, which Colombia had tabled at COP15. According to some delegates involved in the negotiations, the LMG saw this proposal as countering the consistent call for the Global Biodiversity Fund since March 2022 in Geneva, now supported by more than 70 developing countries on record.

The GBF Fund under the GEF, therefore, falls far short of a new, dedicated Global Biodiversity Fund demanded under the authority of the COP, serving as the financial mechanism of the CBD (in line with Article 2) and complementing existing financial arrangements such as the GEF.

The Global Biodiversity Fund fight: From Geneva to Montreal

Negotiations on resource mobilization had been difficult and highly contentious since in-person meetings resumed in March 2022 in Geneva. The Global Biodiversity Fund was first proposed then by the LMG, in its joint statement delivered by Gabon. (See ‘Fraught negotiations at resumed in-person CBD meetings, 5 April 2022.)

The resumed third meeting of the Subsidiary Body on Implementation (SBI-3) adopted Recommendation SBI-3/6 that contained the Global Biodiversity Fund under “Additional elements on resource mobilization” in square brackets (not agreed/unresolved). This document captured ideas expressed by Parties with regard to resource mobilization for the post-2020 GBF. These issues were considered as placeholders to allow them to be further discussed in preparation for and during COP15.

The first element paragraph read, “Decides to establish the Global Biodiversity Fund and designate the Global Biodiversity Fund as an operating entity of the financial mechanism of the Convention, in accordance with Article 21 of the Convention, with arrangements to be concluded between the Conference of the Parties and the Fund at the sixteenth meeting of the Conference of the Parties to ensure that it is accountable to and functions under the guidance of the Conference of the Parties to support projects, programmes, policies and other activities in developing country Parties, in accordance with the terms of reference as agreed upon under annex II”.

Annex II in brackets contained very comprehensive terms of reference for the Global Biodiversity Fund.

Further, the Global Biodiversity Fund was also referenced in brackets specifically under Target 19.1 and Goal D contained in Recommendation WG2020-3/1, adopted by the third meeting of the Open Ended Working Group (OEWG-3) on the post-2020 GBF, which met in parallel to SBI-3 in Geneva.

The joint statement of the LMG delivered by Gabon that partly responded to the state of play on resource mobilization contained a firm call for the Global Biodiversity Fund.

Paragraph 10 of the LMG’s joint statement read, “The current architecture for global biodiversity financing should be transformed. A more robust and effective financial mechanism under the COP for the implementation of Article 20 and 21 is urgently needed as a crucial element for the post-2020 GBF to complement and not supersede existing financial support arrangements, such as the GEF. This financial mechanism should ensure that new, additional, and adequate financial resources are provided by developed country Parties to developing country Parties pursuant to Article 20. This mechanism should include agreement on the establishment of a new Global Biodiversity Fund to complement the GEF for the pooling and disbursement of biodiversity-related financing under Article 20 to support the implementation of the post-2020 GBF up to 2030 and beyond. This will strengthen global cooperation on biodiversity”.

Similarly, at OEWG-4 in Nairobi in June 2022, the Global Biodiversity Fund was in brackets under Target 19.1 and Section H contained in the adopted Recommendation WG2020-4/1. Discussions on resource mobilization remained contentious, with the added element of attempts to dismantle the principle of common but differentiated responsibilities  by several developed countries. (See ‘Stark North-South divisions in resource mobilization discussions’, 4 July 2022.)

Moving towards COP15, the summary of the informal consultations on resource mobilization (CBD/COP/15/INF/22), which were held inter-sessionally in June, October and November 2022, also captured the Global Biodiversity Fund, showing the consistent call by the proponent LMG.

Paragraph 13 of the summary read, “Some stressed the need for a new instrument to ensure that future funding is predictable, stable, independent, self-sustaining, and dedicated to biodiversity. Some participants supported a “second-generation fund” or a Global Biodiversity Fund as a new instrument that could specifically address the challenges experienced with accessing existing funds, learning from any shortcomings identified of the GEF and the Global Climate Fund and building on best practices…”

The summary also reveals challenges of the GEF, specifically in paragraph 12: “Issues with current funding mechanisms were discussed and there was a broad recognition that Parties may face challenges working with the Global Environment Facility (GEF) and that these need to be addressed. Challenges mentioned included scale, access, capacity, speed, overheads and that the GEF is overburdened with different environmental agendas, as well as the gaps in funding. The need to learn from what does or does not currently work was stressed, in order to avoid repeating similar challenges in future….”.

This clearly points out the shortcomings of the limited GBF Fund under the GEF that was finally adopted at COP15.

During the COP15 stock taking plenary session on 10 December, the joint statement by the LMG delivered by Brazil reiterated their demand for the Global Biodiversity Fund, urging the COP Presidency to “fulfill a mandate as old as our Convention [CBD] and establish a funding mechanism that is dedicated to biodiversity, complementing the resource mobilization landscape”.

This would be a “second generation fund”, in the sense that it would draw on lessons learned from the successes and limitations of existing funds, with a view to ensure timely, direct and needs-based access by developing countries, making the CBD “future-ready”. (See TWN update ‘Developing countries in show of unity, call for new biodiversity fund’ 12 December 2022.)

According to those familiar with the negotiations, developed countries, led by the European Union (EU), Norway, Switzerland, the United Kingdom (UK), Canada, Australia, New Zealand, Japan, Iceland, had opposed any text reflecting their obligations under Article 20 (on financial resources) which clearly spells out the financial obligations of the developed countries to developing countries guided by the fundamental principle of common but differentiated responsibilities. They were also blocking the new Global Biodiversity Fund, taking a hardline position to maintain the status quo of exploring the existing financial landscape for resources from “all sources” as well as reforming existing instruments if necessary, such as the GEF.

The negotiating texts on resource mobilization evolved into four iterations throughout COP15 that was entirely conducted in a Contact Group led by Co-Chairs Ines Verleye (Belgium) and Shonisani Munzhedzi (South Africa).

The first non-paper of 10 December was based on Recommendation SBI-3/6 adopted in Geneva. The section on “successor to the current strategy of resource mobilization” had two options containing four paragraphs each (either to adopt it at COP15 along with the GBF or to adopt the GBF first and then revise the strategy at COP16), and on “additional elements for resource mobilization” containing the Global Biodiversity Fund.

The suggested text to replace those sections contained new sections on “short-term action: COP15 to adopt language to facilitate immediate availability of resources over the next two years” and “building longer-term resource mobilization – commensurate with the 2050 Vision of the GBF”.

The latter “longer-term” section contained three options with the third option C reading, “[decides to establish a dedicated global instrument for biodiversity financing to ensure the adequate mobilization of resources from all sources commensurate with the ambition of the GBF, and to develop proposals to operationalize the instrument;]”.

The Global Biodiversity Fund was listed in the Appendix “Possible elements of a global instrument on biodiversity finance” along with payment for ecosystem services schemes, global benefit sharing mechanism (x% of retail sales on biodiversity products), 1% of GDP goal, compensation for biodiversity loss.

Further, Annex 2 “Terms of Reference for the <intergovernmental process> on Resource Mobilization” contained paragraph 3 under the “longer-term” section which read:

 “<The global instrument on biodiversity finance shall:

(a)               not duplicate but complement existing instruments, funds, and frameworks;

(b)               contribute to reduce the fragmentation of the global biodiversity finance landscape and to mobilize more dedicated, accessible, predictable, and adequate international biodiversity finance;

(c)               support the transition from short-term project-based support to long-term sustained finance;

(d)               contribute to diversify funding mechanisms and to enlarging the public and private donor basis by supporting, both on the revenue and the expenditure side, the development and use of innovative financing mechanisms and instruments;

(e)               strengthen (innovative) partnerships;

(f)                contribute to use funds strategically and to improve their efficiency, by using international finance to leverage domestic finance, by using public finance to leverage private finance; and by supporting the creation of synergies in financing across environmental objectives.> (with footnote 6 reading: Only with option C)”.

The second iteration of the non-paper of 13 December contained a more elaborated draft decision text containing new sections, in particular, “strategy for resource mobilization (phase I)” and “review of the strategy for resource mobilization”, among others.

The former contained a new paragraph 13 encouraging the GEF to improve its operations “… including, through the establishment of a Global Biodiversity Framework Trust Fund as elaborated in Annex IV of this decision ...” in the form a clean text without square brackets.

Annex IV contained “Elements of a reform of the Global Environmental Facility in the context of a stepwise approach to the resource mobilization strategy for the GBF” in the form of a draft decision text to establish the proposed Trust Fund.

It is learnt that the introduction of this language on the Trust Fund under the GEF was based on a proposal by Colombia (for Chile, Costa Rica, Mexico and Peru) to contribute to “bridging positions on the proposal to establish a new fund”.

The LMG clearly saw this as biased and prejudging the Trust Fund as an outcome.

On the other hand, the Global Biodiversity Fund was only captured under the new section “review of the strategy for resource mobilization”, specifically in paragraph 27 which was in brackets, reading, “[Also decides to establish a dedicated global biodiversity fund to ensure the adequate mobilization of resources from all sources commensurate with the ambition of the GBF, and to develop proposals to operationalize it;]”.

This meant that the Global Biodiversity Fund was no longer an option in the strategy to be adopted at COP15 but only for later consideration when the strategy would be reviewed.

Annex II renamed as “Terms of Reference for the Advisory Committee on Resource Mobilization” still contained the section on “building longer-term resource mobilization, commensurate with the 2520 Vision of the GBF” which captured “global instrument on biodiversity finance” in brackets from the previous iteration.

According to delegates involved in the negotiations in the evening of 13 December, discussions on the revised text involved extreme views with the developed countries, which refused to show any level of high ambition on their legal obligations to provide “new and additional” resources, commensurate with an ambitious GBF as demanded from developing countries, who carry a heavier burden hosting most of the biodiversity of the world. Developed countries were only open to explore and strengthen the “current financial landscape” with “existing instruments” and with resources from “all sources”.

In particular, the broader LMG led by the African Group pushed for references to the amounts of USD 100 billion and USD 700 billion as a quantum in the text.

While the majority of the developing countries led by the LMG tried to keep the Global Biodiversity Fund as a clear option on the table, the developed countries maintained their rigid stance on the “total lack of ambition and genuine engagement” relating to commitments on resources. As a result, all developing countries engaged in the negotiations decided to “walk out” in the early hours of 14 December, capturing media attention on the contentious negotiations.

On 15 December, the COP Presidency’s letter on the status of progress in negotiations and the mode of work going forward contained ministerial consultations on the outstanding issues. Ministers Jeanne d’Arc Mujawamariya (Rwanda) and Jochen Flashbarth (Germany) were invited to lead consultations on the decision on resource mobilization and related decisions of the GBF (Goal D, Targets 18 and 19.1).

The third iteration of the non-paper of 16 December continued to retain paragraph 27 on the Global Biodiversity Fund in brackets with additional sub-brackets: “[Also] decides to establish a dedicated global biodiversity fund to ensure the adequate mobilization of resources [from all sources] commensurate with the ambition of the GBF, and to develop proposals to operationalize it [at its sixteenth meeting];]”.

This paragraph 27 appeared twice in the related section on “review of the strategy for resource mobilization”.

Moreover, the revised Annex II “Terms of Reference for the Advisory Committee on Resource Mobilization” contained a new specific section on “Global instruments for biodiversity finance” containing four paragraphs in brackets, paragraph 4 reading as, “[The Advisory Committee on Resource Mobilization will prepare the institutional arrangements, modalities, structure, governance, and terms of reference for the Global Biodiversity Fund, for adoption at the sixteenth meeting of the Conference of the Parties;]”.

At the same time, the alternative proposal (by Colombia) of the Trust Fund was also retained in brackets, spelt out as a “Global Biodiversity Framework [DSI Benefit-sharing] Trust Fund” in related paragraphs.

The final fourth iteration of the non-paper of 17 December saw the text on the Global Biodiversity Fund more or less intact, with paragraph 27 appearing as new paragraph 41 reading as, “… decides to establish a dedicated global biodiversity fund to ensure the adequate mobilization of resources [from all sources] commensurate with the ambition of the GBF, and to develop proposals to operationalize it [at its sixteenth meeting];]”. This same text was also reproduced as paragraph 45.

The text under Annex II “Terms of Reference for the Advisory Committee on Resource Mobilization” containing the specific section on “Global instruments for biodiversity finance” also remained unchanged from the previous iteration.

On 18 December morning, the COP Presidency’s text was released containing a new “Global Biodiversity Fund” section. However this fund was now under the authority of the GEF, elaborated by paragraphs 29-38.

Basically, the term Global Biodiversity Fund proposed by the LMG was co-opted to rename the alternative Trust Fund proposal (by Colombia) under the GEF.

The bracketed paragraph 41 referencing the establishment of the Global Biodiversity Fund was dropped from the text. Furthermore, the text under Annex II now contained the section “Global instrument for biodiversity finance” with only two reduced paragraphs, with the previous paragraph 4 on the Global Biodiversity Fund removed as well.

Sources told TWN that besides eliminating the Global Biodiversity Fund from the text, including co-opting of its name, the Presidency’s text reflected more of what the developed countries pushed for in the negotiations, mainly escaping from their CBD Article 20 obligations on financial resources guided by the principle of common but differentiated responsibilities, and shifting the burden to developing countries by stressing domestic resource mobilization and private sector financing.

In order to regain some balance in the text and to keep the option of the establishment of a new, dedicated Global Biodiversity Fund clearly on the table, the LMG made a last-ditch compromise which was reflected in the final decision (CBD/COP/15/L.29) adopted.

Specifically, paragraphs 30-32 replaced the co-opted name of the Global Biodiversity Fund with the “Global Biodiversity Framework Fund” and added a sunset clause, “… and until 2030 unless the Conference of the Parties decides otherwise, ...” to the GBF. In addition, the text contained in Annex II “Terms of Reference for the Advisory Committee on Resource Mobilization” under the section “Global instrument for biodiversity finance” now keeps the Global Biodiversity Fund for further consideration.

Meanwhile, in the financial resources target of the GBF, Parties could only agree to increase resources from developed countries to developing countries, to at least US$ 20 billion per year by 2025, and to at least US$ 30 billion per year by 2030, far short of the LMG demand of at least US$ 100 billion annually, +