policy recommendations
for the G7

ADB Institute


Biodiversity Protection Through Reward, Technology Transfer, and Improving Governance

Biodiversity supports the water bodies, food systems, medicinal plants, thereby sustaining the livelihood of billions of people. According to World Economic Forum’s 2020 Global Risks Report, around one million species are threatened to extinction in the next ten years. Approximately $44 trillion of economic value generation (over 50% of global GDP) is moderately or highly dependent on nature and its services (WEF 2020). The same report further indicates that switching to a nature-based economy could generate 400 million jobs and a business of US$ 10 trillion per year by 2030.

Biodiversity loss means the extinction of plant and water species from land and water, which could greatly impair the livelihood of millions and the global economy. Human behaviour and lack of recognition of the importance of biodiversity for a sustainable future have resulted in biodiversity loss in both land and water. Living Planet Index shows that biodiversity declined by more than 70% between 1970 and 2020. According to the IUCN red list of threatened species, 40,000 species from the total assessed species of 142,577 are threatened to extinction. It is estimated that around 25% of the marine species live in a coral reef, which covers only 250,000 square kilometres of ocean and provides livelihoods to millions is under threat (Burke et al. 2012). Between 1990 to 2020, 420 million hectares of forest have been lost through human activities (FAO and UNEP 2020). Though deforestation has declined to 10 million hectares per year between 2015-2020 compared to 16 million hectares per year in the 1990s, it is still a significant threat to the species in the forest and planet earth (FAO and UNEP 2020).

The Convention on International Trade in Endangered Species (CITES) 36,000 species of plant and animal has been included with different level of protection (CITES 2020). However, the number of endangered species traded rose from 61,241 to 1,299,284 in 2015, which marginally declined to 1,163245 in 2018.

Therefore, the G7 has to uplift the game of conserving biodiversity and ecology to save only one planet. With this end in view, it is recommended that the G7 announce that “biodiversity conservation will be included as one of the central pillars of trade and development through reward mechanism” at its Elmau Summit. As G7 has the resources, technology, market power to reward and punish countries, communities, and individuals that protect and conserve biodiversity and natural capital in the global north and south, G7 is the right platform to take leadership and initiative towards this agenda. Those communities and individuals who protect and conserve biodiversity and natural capital should receive preferential treatment in trade, investment, and grants/aids, while the countries, communities, and individuals responsible for the destruction of biodiversity and ecology should be treated contrarily. Finally, develop capacity and governance in the global south on biodiversity and nature conservation.

Financing a Green Future: The Energy Transition Mechanism (ETM) and the Green Impact Fund for Technology (GIFT)

The G7 should consider (i) an Energy Transition Mechanism (ETM) and (ii) a Green Impact Fund for Technology (GIFT) to accelerate the transition from fossil fuels to low-carbon technologies in developing countries.  ETM is a scalable, collaborative initiative led by the Asian Development Bank (ADB) in partnership with developing countries that will leverage a market-based approach to accelerate the transition from fossil fuels to clean energy. It funds early retirement of coal power plants in developing countries using the proceeds from ETM purchased coal plants for low-carbon technologies. Pilots of ETM have been launched in Indonesia, the Philippines and Viet Nam. GIFT would reward emission reductions achieved in specified developing countries with any patented green technology whose monopoly privileges in this “GIFT Zone” are waived. To prepare for GIFT initiative, the G7 should immediately fund a pilot project featuring a single reward pool to be split among preselected green innovators in proportion to the emission reductions they achieve with their respective innovations, affordably priced, in a self-selected region of the GIFT Zone over a 2-year period. With preparation and assessment, a meaningful pilot could be completed for €35 million per annum over four years. These proposals complement to each other. ETM stimulates demand and GIFT reduces the cost to implement low-carbon technologies.

Food-Climate Nexus: Need for an International Small Holder Farmers Agribusiness Consortium

Climate change against the backdrop of rising population, increasing inequality, and natural resource depletion threatens global food and nutritional security. To make the situation worse, 1.3 billion tons of food (one-third of total production or food sufficient to feed around 33% of the global population) is wasted every year (FAO, 2011). Further, the ongoing pandemic has exposed the vulnerability of fragile supply chains. Therefore, feeding an estimated global population of 10 billion by 2050 and achieving food and nutritional security along the continuum of availability, accessibility, and acceptability requires a shared commitment and coordinated action among policymakers. This policy brief points to the agriculture- climate nexus with the underlying water-soil-energy linkages, implying that farming is a cause and consequence of climate change. This brief further highlights the vulnerability of the smallholder farmers that constitute around 85% of the production units worldwide and are particularly vulnerable to climate change. They have the biggest stake in climate-centered food security. 

The global institutional architecture that exists for promoting agriculture development, such as the Consultative Group on International Agriculture Research (CGIAR); Food and Agriculture Organization of the United Nations (FAO); and the International Fund for Agriculture Development (FAO), to name a few, have done a commendable job in developing high yielding crop varieties and livestock breeds and promoting good agriculture practices that set global benchmarks for yields, quality, nutrition, and related parameters. These institutional efforts have helped the developing and developed countries accelerate their agriculture growth rates and, more importantly, expand the aggregate food production to feed the growing population. Yet, the smallholder farmers with micro land holdings of two hectares or less and the family-owned farms that are now at the receiving end of the climate change risks have not benefited much from the work of the global institutions. Now that they are exposed to more serious consequences of climate change patterns, a sharper institutional focus on the smallholder farmers is imperative to the future of food and nutritional security. 

 Raising the capacity and resilience of the smallholder farmers through linkage to the global value chain would determine the climate-resilient character of global agriculture, including cropping systems, livestock farming, fishery, agro-forestry, and allied activities that harvest food from nature. With this end in view, it is recommended that the G7 announce the formation of an “International Small Holder Farmers’ Agribusiness Consortium” at its Elmau Summit. The Consortium may be funded out of the resources likely to be allocated by the G7 for the wider program of managing climate change (both mitigation and adaptation). More importantly, the proposed organization must be designed strategically to operate on the principle of Trusteeship. The spirit of Trusteeship should engender a sense of trust among the global community of smallholder farmers that there is that support and commitment from the research and development; agriculture education and extension; access to credit, and above all, the agribusiness trade for both inputs and farm output across the world, to appreciate the role and relevance of smallholders to the emerging paradigm of food security and enable them to collectivize and co-create institutions at the national and sub-national levels to protect and advance their interests. 

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