Target 18. Reduce harmful incentives by at least $500 billion per year
Identify by 2025, and eliminate, phase out or reform incentives, including subsidies, harmful for biodiversity, in a proportionate, just, fair, effective and equitable way, while substantially and progressively reducing them by at least $500 billion per year by 2030, starting with the most harmful incentives, and scale up positive incentives for the conservation and sustainable use of biodiversity.
Incentives, including subsidies, harmful to biodiversity are an important underlying driver of biodiversity loss. Substantial and widespread changes to subsidies and other incentives that are harmful to biodiversity are required to ensure sustainability. Eliminating, phasing out or reforming harmful incentives is a critical and necessary step that would also generate net socioeconomic benefits. The creation or further development of positive incentives for the conservation and sustainable use of biodiversity would also help reach the 2050 Vision for biodiversity by providing financial resources or other motives to encourage actors to undertake actions that would benefit biodiversity.
Article 11 of the Convention calls, on Parties to adopt, as far as possible and as appropriate, economically and socially sound measures that act as incentives for the conservation and sustainable use of biodiversity. The COP has recognized since its fifth meeting that implementing Article 11 needs to include action on those measures that generate incentives harmful for biodiversity; estimates indicate that harmful subsidies generate significant damage to biodiversity and that the amounts spent on these are substantially higher that those spent on positive incentive measures. Target 18 is therefore key to correct this unbalance and progressively align the incentives of economic agents with the objectives of the Convention.
This target has two main components. The first is the elimination, phasing out or reform of incentives, including subsidies, that are harmful to biodiversity. The second is the scaling up of positive incentives for the conservation and sustainable use of biodiversity. The target further identifies several elements to accomplish this:
- Identify – In most countries there will be various incentives, including subsidies, in place with varied impacts on biodiversity. Further, the harmful effects of some incentive measures may or may not be readily apparent and detectable. As such, the first element of this target calls for the identification of incentives that are harmful to biodiversity by 2025. However, this identification step should not preclude immediate action on the elimination, phasing out or reform of harmful incentives where possible.
- Eliminate, phase out or reform – The target calls for the substantial and progressive elimination, phasing out or reforming of harmful subsidies reaching $500 billion per year by 2030. Both the elimination or phasing out of harmful incentives requires Parties to end support for such incentives. For some types of incentives, it may be possible to eliminate them outright. However, for most incentives a more scaled or gradual approach may be required as different sectors or groups in society have come to depend on them. In some cases, it may not be possible eliminate or phase out harmful incentives as they are deemed important for other societal objectives. In these cases, incentives harmful to biodiversity should be reformed so that their negative impacts are reduced as much as possible.
- Incentives, including subsidies, harmful for biodiversity – Harmful incentives generally emanate from policies or programmes that induce unsustainable behaviour harmful to biodiversity, often as unanticipated and unintended side effects of policies or programmes designed to achieve other objectives. Types of possibly harmful incentives include production subsidies and consumer subsidies, while policies and laws governing resource use, such as land tenure systems and environmental resource management, can also have harmful effects.
- In a proportionate, just, fair, effective and equitable way – Different countries have different amounts and types of incentives, including subsidies, that are harmful to biodiversity. Some of these harmful incentives may be deemed necessary in order to reach other societal objectives. The reduction, elimination or phasing out of incentives should take these points into account.
- Most harmful incentives – The target prioritizes acting on those incentives with the most harmful effects. Past studies have shown that these are not necessarily the ones with the highest financial outlays.
- Scale up positive incentives – Positive incentives are economic, legal or institutional measures designed to encourage activities beneficial to biodiversity. Positive incentives can include such things as public or grant-aided land purchases or conservation easements.
- Actions to reach Target 18 should take into account all of the considerations for implementation identified in section C of the Kunming-Montreal Global Biodiversity Framework.
- Progress towards this target would help to reach goals A, B and D of the Kunming-Montreal Global Biodiversity Framework and would also help to make progress towards targets 5, 7, 9, 10, 16 and 19. Conversely, progress towards targets 14, 15, 20, 21, 22 and 23 would support progress towards this target.
- This target addresses issues previously addressed under Aichi Biodiversity Target 3.
- Elements of Target 8 are also addressed in the targets of the Sustainable Development Goals, including targets 12.c and 14.6.
- What incentives, including subsidies, harmful to biodiversity exist in the country? How are they affecting biodiversity? Which are particularly harmful?
- What are the opportunities and constraints to eliminating, reforming or phasing out harmful incentives? What are the potential ecological, economic, and social costs and benefits of addressing harmful incentives?
- What biodiversity-related problems could be addressed with the help of biodiversity-positive incentives? How could incentives be used to address the main threats to biodiversity? How could incentives encourage actions in support of biodiversity?
- Who are the stakeholders that may be affected? How can they be involved and their needs addressed? What are the trade-offs to consider? Are there stakeholders who could also act as champions for the removal, phase out, or reform of harmful incentives?
- What additional resources (financial, human and technical) will be required to reach the national target that is set? How can additional resources be raised? What are the possible sources for these resources?
The monitoring framework for the Kunming-Montreal Global Biodiversity Framework identifies the following indicators for this target:
- 18.1 Positive incentives in place to promote biodiversity conservation and sustainable use
- 18.2 Value of subsidies and other incentives harmful to biodiversity that have been eliminated, phased out or reformed
- Value of subsidies and other incentives harmful to biodiversity, that are redirected, repurposed or eliminated
- Number of countries with biodiversity-relevant taxes
- Number of countries with biodiversity-relevant charges and fees
- Number of countries with biodiversity-relevant tradable permit schemes
- Trends in potentially environmentally harmful elements of government support to agriculture (producer support estimate)
- Trends in the number and value of government fossil fuel support measures
- Amount of fossil-fuel subsidies per unit of GDP (production and consumption)
- OECD (2022): Identifying and assessing subsidies and other incentives harmful to biodiversity: A comparative review of existing national-level assessments and insights for good practice. OECD environment working papers 206.
- OECD (2021): Tracking Economic Instruments and Finance for Biodiversity.
- Resource Mobilization: Progress in achieving the milestones for the full implementation of Aichi Biodiversity Target 3 (CBD/SBI/2/INF/15).
- World Bank 2017: The Sunken Billions Revisited. Progress and Challenges in Global Marine Fisheries.
Tools and guidance
Note from the Secretariat: This guidance material provides an overview of the target by briefly introducing key terms, highlighting some of the implications for national target setting, and providing key points and guiding questions for consideration as part of national target-setting exercises. It also identifies the adopted indicators to monitor progress and resources that could assist with national target setting and implementation. This material should be considered a work in progress, and it will be periodically updated with inputs from Parties and partner organizations in the light of experiences with its use. This information is meant to serve as a resource that Parties and others may wish to consider as they implement the Global Biodiversity Framework. It does not replace or qualify decision 15/4 or 15/5.