How innovative financing can help protect the black rhino population

  • The illegal wildlife trade is actually the fourth world’s greatest crime estimated between 7 and 23 billion dollars per year.
  • Creating long-term financing solutions for species conservation and engaging people through livelihood development is key to increasing conservation efforts.
  • Known as the “Rhino Bond,” the Wildlife Conservation Bond (WCB) is a five-year, $150 million sustainability bond that will help protect and increase black rhino populations in two protected areas in South Africa.
  • What’s special is that the Rhino Bond is a financial instrument that channels investments to achieve specific conservation outcomes – measured in this case by increased black rhino populations.

When asked about illegal activities around the world, the areas most people would consider include drugs, human trafficking and weapons. What may not immediately come to mind is the illegal trade in wildlife and wildlife products – but it is actually the fourth world’s greatest crime estimated between 7 and 23 billion dollars per year, often managed by sophisticated, international and well-organized criminal networks.

The cost of conservation efforts is rising

Most of the wildlife trade is legal and by no means always a problem, but when combined with industrial-scale illegal activities and the general decline of species on earth, global animal populations decline by almost 70% in 50 yearswe face the prospect of living in a world without some of its most iconic species.

Rhino populations, in particular, are under immense pressure, with their numbers in the wild rising from 70,000 in 1970 to only about 27,000 todayand it is reported that 96% of black rhinos were poached between 1972 and 1996. Driven by demand for rhino horn, which has reached unprecedented levels, driving up prices and poaching levels, with the value of horns reaching up to USD 60,000 per kg. The resulting illegal trade is pushing rhinos towards a tipping point, where deaths will begin to exceed births.

Due to these pressures, the costs of conservation efforts to protect rhino populations are rising. Many protected areas face funding shortfalls, with traditional funding sources becoming insufficient to keep pace with such a sophisticated and large-scale criminal operation. Conservation officials are struggling to raise the funds needed for the day-to-day management and protection of rhinos, let alone what might be needed to sustain their efforts over the long term.

Unfortunately, this reflects the broader challenge of biodiversity conservation. According to the 2020 “Financing Nature: Closing the Global Biodiversity Financing Gap” report by the Paulson Institute et al, there is an annual financing gap to conserve biodiversity and ecosystems estimated between $598 billion to $824 billion per year over the next decade.

Biodiversity loss and climate change are occurring at an unprecedented rate, threatening the very survival of humanity. Nature is in crisis, but there is hope. Investing in nature can not only increase our resilience to socioeconomic and environmental shocks, but also help societies thrive.

There is a strong recognition within the Forum that the future must be net zero and positive for nature. The Nature Action Agenda initiative, within the Platform to Accelerate Nature-Based Solutions, is an inclusive, multi-stakeholder movement that catalyzes economic action to halt biodiversity loss by 2030.

Vibrant and thriving natural ecosystems are the foundation of human well-being and prosperity. The future of nature and business report found that nature-positive transitions in key sectors are good for the economy and could generate up to $10.1 trillion in annual business value and create 395 million jobs by 2030.

To support these transitions, the Nature-Based Solutions Acceleration Platform has brought together a community of Nature Champions promoting the sustainable management of the planet for the good of the economy and society. The Nature Action Agenda also recently launched the 100 million farmers initiative, which will drive the transition of the food and agricultural system to a regenerative model, as well as the BiodiverCities initiative by 2030 to create a model of urban development in harmony with nature.

Contact us if you would like to collaborate in these efforts or join one of our communities.

Changing the conservation funding model

It is a complex problem that combines high demand and organized crime at the global level, with poverty, corruption, inadequate enforcement and political instability at the local level. Creating long-term financing solutions for species conservation and engaging people through livelihood development will depend on how the way conservation is financed evolves.

Beginning to solve this problem requires an approach that can be targeted and scalable; that combines investment opportunities and measurable improvements. And one such solution now exists – the “Rhino Bond”, which seeks to directly link rhino conservation outcomes to investor payouts and investment success.

The World Bank (International Bank for Reconstruction and Development, IBRD) recently priced the Wildlife Conservation Bond (WCB) in support of South Africa’s efforts to conserve endangered species through a partnership with Credit Suisse as sole structurer of the bond.

Rhino populations are concentrated in Africa, and they are even more concentrated in South Africa which holds an estimate 79% of Africa’s rhino population. They are considered an umbrella species that plays a crucial role in forming entire ecosystems upon which countless other animals depend.

Also known as the “Rhino Bond,” the WCB is a five-year, $150 million sustainability bond that will help protect and increase black rhino populations in two protected areas in North Africa. South : Addo Elephant National Park and Great Fish River Nature Reserve. Proceeds from the bond will support the financing of World Bank sustainable development projects and programs globally, a number of which focus on biodiversity. Instead of going to investors, WCB coupon payments, $10 million, will go to the two protected areas to fund rhino conservation.

It is hoped that the surety:

  • Securing and developing critically endangered rhinoceros populations
  • Protecting biodiversity and supporting improvements in planetary health
  • Change conservation funding strategies and increase opportunities for investment in conservation activities.

Measuring success by the number of black rhino populations

What’s special is that the Rhino Bond is a financial instrument that channels investments to achieve specific conservation outcomes – measured in this case by increased black rhino populations. It includes a potential Global Environment Facility (GEF) performance payment based on any rate of rhino population growth. Importantly, the model is anchored in measurements and evidence, which encourages stakeholders to analyze and understand conservation issues, define progress and focus on outcomes, thereby shifting the focus from outcomes to short term to long-term impacts.

Through the WCB, private sector investments can go directly to funding activities to protect and grow a critically endangered species, with additional potential benefits of directly contributing to biodiversity and creating benefits. for local communities through the creation of conservation-related jobs in a rural and underserved region of South Africa. This further reinforces a shift in mindset for communities that have rich natural capital resources on their doorstep, which is critical to the long-term success of currently threatened species.

The WCB model provides a new blueprint for how conservation is financed and has the potential to be a key tool for implementing the post-2020 Global Biodiversity Framework. Excitingly, there is potential for the model to be replicated and scaled to meet other conservation and climate actions and development goals around the world, for example elephants, and even specific protected areas themselves. same.


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