Why the Natural Capital Lab?
Although it represents only 16% of the planet’s land, Latin America and the Caribbean (LAC) holds 40% of the world’s biological diversity and contains seven of the world’s 25 biodiversity hotspots, six of the 17 “megadiverse” countries, 11 of the 14 terrestrial biomes, and the second largest reef system worldwide. More than 30% of the earth’s available freshwater and almost 50% of the world’s tropical forests are found in the region and LAC possesses a vast array of terrestrial, freshwater, coastal, and marine ecosystems containing some of the richest collections of birds, mammals, plants, amphibians, and landscapes on the planet. This unique source of capital -- natural capital -- generates important life-supporting benefits for people called ecosystem services.
However, natural resources are under threat. A recent study by WWF showed that South and Central America have lost 89% of their populations of mammals, birds, fish, reptiles, and amphibians. Global Forest Watch data shows that 4 of the top 10 countries for tropical tree cover loss in 2017 were in Latin America. Mangrove deforestation rates are 3-5 times higher globally than terrestrial forests. In our oceans, 90% of fish stocks are either fully fished or over-fished, and plastic pollution has been detected in all major marine environments. Chemical and air pollution continues to advance, with the WHO estimating that 90% of the world’s population lives with toxic air.
McKinsey and company estimates that $300 billion to $400 billion is needed each year to preserve and restore ecosystems, but conservation projects receive just $52 billion, mostly from public and philanthropic sources. This shortfall in funding can be partially addressed through mobilization of private investment – by supporting private actors that are sustainably leveraging natural capital, facilitating private investment in conservation and restoration projects, and fostering private innovation in sustainability solutions. It can also be addressed by helping all actors – the public sector, corporates, entrepreneurs, and civil society begin to quantify the value of natural capital in economic terms.
As countries seek to reach their commitments under the Convention on Biological Diversity, the Paris Climate Accord, and Sustainable Development Goals 14 and 15, the sustainable use of natural capital will become vitally important to the achievement of these national commitments, national development strategies, and local livelihoods.
There is a major opportunity to catalyze innovative ways to efficiently and sustainable put LAC’s natural capital ecosystem services at the service of the region.