SDG 15 – Life on Land

How KfW is committed to biodiversity

Nature is both the origin and habitat of people, animals and plants. Healthy, diverse ecosystems provide us with air, water and raw materials of all types. They form the basis of our existence and are a prerequisite for economic development. This is why the SDGs are not just directed at people; the relationship between people, animals and nature must be symbiotic to ensure quality of life for all. It is now known that the two SDGs, Life on Land (SDG 15) and Life Below Water (SDG 14), are considered particularly important levers. They act as a catalyst – or vice versa, as an obstacle – for the remaining SDGs and are therefore considered the key to achieving the Sustainable Development Goals as a whole.

Keeping nature intact to the greatest extent possible or restoring it is also very important for food security, for example, because birds and insects are needed for pollination of plants. But it’s not just the pollinators that are disappearing; farmland diversity is also declining. Nine species, including rice, maize and wheat, now dominate global agriculture. However, diversity in farmland is important; it can make agriculture more resilient to pests and help to develop new varieties that may be better able to cope with the changing conditions caused by climate change.

Nature also plays a decisive role in climate protection. Forests, peatlands and soils are natural carbon sinks that can help to effectively reduce carbon dioxide in the atmosphere. According to calculations by the Intergovernmental Panel on Climate Change and the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPCC and IPBES), plants and oceans naturally absorb around half of the carbon emitted by humans. When forests are cleared, not only are species and ecosystem services lost, but vast amounts of climate-damaging greenhouse gases are also released. Preserving biodiversity, protecting endangered animal species and terrestrial ecosystems, and no longer destroying forests, but managing them sustainably, therefore also have a vital benefit for the climate.

After all, nature is important for our health – the coronavirus pandemic clearly demonstrated that. The outbreak of the pandemic was also a consequence of the global exploitation of nature. Around 70% of all emerging infectious diseases like Ebola, Zika and influenza are zoonoses (diseases that are transmitted from animal to human and vice versa). According to IPBES figures, there are still around 1.7 million unidentified viruses in mammals and birds, of which a significant proportion could be transmissible to humans. As more intact ecosystems are destroyed, there are more opportunities for closer contact with these pathogens, which increases the likelihood of transmission.

Biodiversity is therefore vital (to survival) in many respects and must be preserved as a matter of urgency. At the moment, however, the opposite is true. Species loss is accelerating rapidly; today it is at least 100 times faster than it would be without human intervention. Experts are already speaking of a new mass extinction. Between 1970 and 2018, the world's population of wild animals – mammals, birds, fish, amphibians and reptiles – decreased by 69% on average. And this loss continues unabated. According to IPBES projections, of an estimated eight million species, one million face extinction in the coming decades.

KfW is committed to reversing this trend, in line with the 2030 Agenda and the new “Global Biodiversity Framework”. Conserving nature and protecting biodiversity is an issue of central importance for the future for humanity. Specifically, three inter-related crises need to be resolved all at once: limiting climate change to a tolerable level, combating hunger and achieving security of food supply, preventing and containing pandemics, and preserving biodiversity.

An increasing number of animal and plant species are dying out. The International Union for Conservation of Nature (IUCN) Red List indicates that over 41,000 species worldwide are currently critically endangered. Without decisive action, this is the beginning of a species loss on a global scale.

This makes it necessary to create and protect conservation areas, especially in “biodiversity hotspots” which are primarily found in developing countries and emerging economies. However, as these are countries like the Democratic Republic of Congo, Namibia, Madagascar, Ecuador and Laos, there is still a significant financial shortfall. Earmarking more protected areas – currently only around 17% of rural areas are protected, with some protection only existing on paper – and protecting the existing areas effectively and equitably, requires additional funds which are sufficiently secure so that their use can be planned.

KfW is working on this. It supports a range of nature conservation funds such as the Caucasus Nature Fund and the Community Conservation Fund of Namibia as well as several environmental foundations and international NGOs to identify new areas and to better manage existing conservation areas, for example in West Africa. This enables them to protect flora and fauna effectively while simultaneously ensuring that local people are sufficiently involved in using conservation areas.

KfW has declared its intentions to involve more private investors than previously. It can thus use the limited development cooperation funds to open up new sources of financing for conservation. It was for this reason that KfW on behalf of the German Federal Government set up the Legacy Landscapes Fund (LLF), which began its work in spring 2021. The fund supports areas in developing countries in which biodiversity is high but financial resources are scarce. This will make it possible to safeguard a good amount of the biodiversity that is vital for all of humankind. Its goal by 2030 is to fund at least 30 sites for 15 years or more so that protected areas can do their job properly and truly protect nature. The fund’s special feature is that, in addition to public donors, private actors such as charitable trusts and companies are also involved. This ensures that more funds can be mobilised for conservation than would otherwise have been the case. Currently, the fund has around EUR 295 million at its disposal from public and private sources, which now also include France and Norway. Further grants are in the pipeline.

At the end of 2022, the LLF's funding portfolio comprised seven protected areas on three continents with a total area of around 73,000 square kilometres; a further seven areas with an area of over 300,000 square kilometres are in the planning stage.

In total, KfW finances terrestrial nature conservation areas in 51 countries on behalf of the German Federal Government, with a total area of more than 1.5 million square kilometres - an area as large as France, Spain and Sweden combined. Its activities focus on Latin America and Africa.

Forests perform many important ecological tasks. As the “lungs of the planet” they supply oxygen, regulate the climate, protect against erosion, store drinking water, produce valuable raw materials, food and medicinal products, cushion the effects of storms and enable endangered species to survive. In rural parts of many developing countries, the forest is also an important economic factor that enables people there to survive.

People have been transforming forested areas for millennia, usually for agricultural purposes. In the recent past, however, this practice has taken on extremely dangerous proportions, not least in relation to climate change, because forests play a key role in limiting global warming. About 30% of human greenhouse gas emissions are absorbed and stored by ecosystems, especially forests, oceans and peatlands. Forests are therefore particularly important carbon sinks, but in recent years the deforestation rate has been estimated at 10 million hectares annually.

As the originator of the concept of sustainability over 300 years ago (the term originally came from the German forestry industry), Germany is particularly involved in forest conservation. This takes various forms. On the one hand, there are nature conservation areas which are highly important in fighting deforestation and conserving biodiversity. However, the interests of people and local users must not be forgotten in the process. Nature conservation can only work in the long term when both people and nature benefit in equal measure. It is about conserving forests and managing them sustainably. KfW contributes to the protection of over 100 million hectares of forest and has a diverse portfolio of almost EUR 3 billion (as of the end of 2022), covering various types of projects.

It also promotes the REDD approach (Reducing Emissions from Deforestation and Degradation), for example. The principle here is that climate and development funding is only provided if partner countries can demonstrate that they have reduced greenhouse gas emissions through sustainable use and combating deforestation.

KfW also promotes sustainable management of existing forests, especially in Asia and Latin America. For example, the Indonesian-German forest programmes were developed to address the problem of deforestation and slash-and-burn clearance. These programmes aim to develop and implement sustainable forest management methods and protect natural habitats. In Paraguay, KfW also promotes the management of such protected areas with the involvement of the local population.

Another important aim of KfW is to restore degraded tree-rich landscapes and forests which have been cleared. One concept in this area is “ Forest and Landscape Restoration” (FLR). It combines the ecological functions of the forest with its productive use, from which the local population benefits, e.g. through higher incomes.

Alongside forest and nature conservation, new economic practices are needed to avoid further endangering natural resources. Agriculture in particular is considered a threat to biodiversity conservation. The practice of clearing more and more forests for agricultural land is no longer sustainable. Currently, up to 80% of global deforestation of tropical rain forests is due to agriculture; resource depletion for timber extraction or mining and land speculation are also significant drivers.

In addition to forests, other valuable ecosystems such as wetlands and savannahs are also being destroyed. And with them, an important part of biodiversity is disappearing. To reverse this trend, agriculture in particular, but also the general economy, must undergo a transformation towards more sustainable forms of production, taking into account the finite nature of natural resources. Consumption patterns – especially in the Global North – also need to change in order to reduce the pressure for land expansion. This requires incentives and capital.

KfW sees itself as a driving force in this regard; it is supporting this change in land use and agriculture with targeted programmes. For example, it promotes sustainable and agroecological cultivation and production methods in India, as various cultivation systems such as agroforestry systems or mixed crops contain significantly greater plant and animal diversity than monocultures. Soil and erosion control also supports the preservation of biodiversity and ecosystem functions at landscape level.

The eco.business Fund was established in 2014 on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ) as a particularly innovative example. Through green credit lines, it promotes economic activity which contributes to the sustainable use of raw materials and the preservation of biodiversity. It started its work in Latin America and the Caribbean, where it focuses on four areas: agriculture, forestry, eco-tourism, fisheries and aquaculture. It was so successful there that in late 2019 it was able to expand to include Africa. Since its founding, the fund has contributed, among other things, to the sustainable use of more than 900,000 hectares of land.

Germany is strongly committed to the conservation of biological diversity and is now one of the world's largest donors through KfW, among others. It takes care to include indigenous peoples and local communities (IPLC), as their livelihoods depend heavily on nature. At the same time, they are often also particularly good “guardians” of nature. This involvement is done, for example, through active participation in local decisions or through complaint mechanisms so that they can contact someone if their concerns are not sufficiently taken into account.

In 2023, the commitment volume for KfW projects that contribute to achieving SDG 15 was more than EUR 925 million. This can be used, among other things, to protect, sustainably manage and restore forests and to support agricultural resource management measures that help to use agricultural land more sustainably. KfW cooperates not only with partner countries in this work, but also with major nature conservation organisations like the International Union for Conservation of Nature (IUCN) and with non-governmental organisations like the World Wide Fund for Nature (WWF) and the Frankfurt Zoological Society (ZGF). They all jointly pursue the goal of protecting and preserving natural habitats as extensively as possible.

“Our rights should be respected”

Indigenous populations are safeguarding a large part of the essential biodiversity on Earth but very often have no land titles. The Secretary-General of the Asia Indigenous Peoples Pact, Joan Carling from the Philippines, says her peoples should finally be recognized as partners.

A large herd of wild animals run across a barren meadow

„Madidi National Park in Bolivien – Preserving biodiversity “

Bolivia is one of the 15 countries with the greatest biodiversity. But this biodiversity is under threat - not least due to the rapidly increasing rate of deforestation. Learn in this film how the Legacy Landscapes Fund (LLF) enables nature conservation in Bolivia's Madidi National Park.

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