How to Fund Biodiversity and Fight ‘Biopiracy’
As negotiators from 196 countries prepare to gather at COP16 in Cali, Colombia this October, a critical challenge looms large: how to bridge the staggering $200 billion annual funding gap for biodiversity protection and restoration. Addressing this gap will be at the top of the agenda, with discussions focusing on innovative ways to secure the necessary funds.
Emerging Funding Proposals
Various proposals have been put forward, ranging from donations by wealthy nations to the creation of impact funds or bonds that deploy private capital. Another intriguing proposal is the development of an international market for biodiversity credits—tradable instruments representing a unit of protected or restored nature, similar to carbon credits.
However, the most ambitious initiative under consideration is the establishment of a global system to collect and share a fraction of the trillions of dollars in revenue generated by some of the world’s largest corporations. Companies in sectors such as pharmaceuticals, biotechnology, and agriculture would be asked to contribute to a fund that compensates the countries from which their resources are derived. These funds would then be used to protect and restore natural ecosystems.
“It’s a new paradigm,” said Siva Thambisetty, associate professor of law at the London School of Economics. “We have seen these resources as abundant, replenishable, and ‘free’ for far too long, and that’s changing.”
The Changing Landscape of Genetic Resource Utilization
Over the past decade, technological advancements have revolutionized how companies utilize the world’s genetic resources—whether they are microbes, plants, or animals. Historically, researchers would physically collect samples of genetic material, such as the sap of Malaysia’s trees or the orchids of Cameroon, to be studied or commercialized. This process has been governed by international agreements like the 1992 United Nations Convention on Biological Diversity and the 2010 Nagoya Protocol, which set out rules for access to and benefit-sharing from these resources.
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Today, however, researchers often take a digital fingerprint of a genetic resource, upload it to a database, and use it in labs far from the resource’s country of origin. This shift has exposed a significant regulatory gap: there is no global rule on how countries should be compensated for the “digital sequence information” (DSI) derived from their genetic resources. This loophole has been dubbed “biopiracy” by some developing nations.
“Suddenly there is this corpus of online data, which is very hard to trace back to an origin, and a company—without any mal-intent—is pulling down that data and using it to derive commercial value,” said Glen Gowers, chief executive of Basecamp Research, a biological data company. “Digital sequence information is all about capturing that digital flow of value from biodiversity to biotech.”
The Path to COP16
At COP15 in Montreal, parties to the UN Convention on Biological Diversity agreed to create a new financial mechanism to address the issue of DSI. The upcoming COP16 will be critical in deciding how this mechanism will function. Delegates will debate which industrial sectors should be targeted, how payments should be triggered, and who will oversee and benefit from the fund. They will also discuss whether companies that rely on DSI should contribute a portion of their overall revenue or just a share of the profits derived from DSI-based products.
Proposals for contributions range from 0.1% to 1% of revenue, with the UN estimating that this could generate between $1 billion and $10 billion per year for nature—potentially one of the largest global contributions to biodiversity finance. Some African countries are proposing an even more ambitious target of 1% of all global retail sales, which could single-handedly close the $200 billion annual funding gap. “It’s a cent on the dollar to save life on earth,” said Pierre du Plessis, a technical advisor to the African group of negotiators.
Anticipated Challenges
Despite the promising potential, significant resistance is expected. Countries like Japan and Switzerland have expressed opposition to a mandatory mechanism, and pharmaceutical giant GSK has warned of potential “negative implications for public health.”
Nevertheless, the tide may be turning. “New accountability mechanisms are coming into place,” Thambisetty said. “The direction of travel is that biodiversity is not free.” The era of unfettered access to the world’s natural resources could soon be coming to an end, as the global community grapples with the urgent need to protect and restore the planet’s biodiversity.
As COP16 approaches, the world will be watching closely to see whether these new ideas and proposals can gain the traction needed to secure a sustainable future for the planet’s most vulnerable ecosystems.
Article information source By Natasha White
