Closing the gap Financing and resourcing of protected and conserved areas in Eastern and Southern Africa INTERNATIONAL UNION FOR CONSERVATION OF NATURE - BIOPAMA PROGRAMME Financing and resourcing of protected and conserved areas in Eastern and Southern Africa Closing the gap Financing and resourcing of protected and conserved areas in Eastern and Southern Africa I Closing the gap The designation of geographical entities in this book, and the presentation of the material, do not imply the expression of any opinion whatsoever on the part of IUCN [**or other participating organisations] concerning the legal status of any country, territory, or area, or of its authorities, or concerning the delimitation of its frontiers or boundaries. The views expressed in this publication do not necessarily reflect those of the European Union, the African, Caribbean and Pacific (ACP) Group of States, IUCN or other participating organisations. IUCN is pleased to acknowledge the support for this publication produced under the Biodiversity and Protected Areas Management (BIOPAMA) Programme, an initiative of the African, Caribbean and Pacific (ACP) Group of States financed by the 11th European Development Fund (EDF) of the European Union. BIOPAMA is jointly implemented by the International Union for Conservation of Nature and the Joint Research Centre of the European Commission. IUCN acknowledges Conservation Capital for providing substantive content to this report. Published by: IUCN Regional Office for Eastern and Southern Africa, in collaboration with the Biodiversity and Protected Areas Management (BIOPAMA) Programme Copyright: © 2020 IUCN, International Union for Conservation of Nature and Natural Resources Reproduction of this publication for educational or other non-commercial purposes is authorised without prior written permission from the copyright holder provided the source is fully acknowledged. Reproduction of this publication for resale or other commercial purposes is prohibited without prior written permission of the copyright holder. Citation: IUCN ESARO (2020). Closing the gap. The financing and resourcing of protected and conserved areas in Eastern and Southern Africa. Nairobi, Kenya: IUCN ESARO; BIOPAMA. Cover photo: Micheile Henderson - Unsplash Layout by: Penrose CDB Available from: IUCN, International Union for Conservation of Nature The Biodiversity and Protected Areas Management (BIOPAMA) Programme Rue Mauverney 28 1196 Gland, Switzerland [email protected] www.iucn.org/resources/publications www.biopama.org II Financing and resourcing of protected and conserved areas in Eastern and Southern Africa Table of contents Executive summary IV Glossary and list of acronyms IX 1. Introduction 1 2. Methodology 3 3. The funding gap in Eastern and Southern Africa 8 3.1 The global biodiversity funding gap 9 3.2 The need to increase the protected area estate and related funding 9 3.3 Protected and conserved areas in Eastern and Southern Africa 10 3.4 Downgrading, downsizing, and degazettement of protected areas in Eastern 12 and Southern Africa 3.5 Protected area expansion in Eastern and Southern Africa 14 3.6 Protected area expenditures and revenue flow 15 3.7 Eastern and Southern Africa’s biodiversity financing and resourcing 16 challenge 4. Traditional sources of finance for protected areas 20 4.1 Government support 21 4.2 Donor support 22 4.3 Nature-based tourism 25 4.4 Utilisation 28 5. Maximising self-generated revenue through nature-based tourism 32 5.1 The nature-based tourism market 33 5.2 The benefits of nature-based tourism 35 5.3 Opportunities for further development of nature-based tourism in ESA 37 6. Emerging sources of finance for protected areas 41 6.1 Conservation Trust Funds 42 6.2 Debt for Nature Swaps 44 6.3 Payment for Ecosystem Services 47 6.4 Mitigation measures / Biodiversity offsets 50 6.5. Collaborative management / Public-Private Partnerships 52 7. New sources of finance for protected areas 56 7.1 Outcomes-based financing mechanisms 57 7.2 Green and blue bonds 57 7.3 Tax incentives 58 7.4 Project Finance for Permanence 59 7.5 Other 60 8. Conclusion 62 Bibliography XII Annexes XXII Conservation Trust Funds XXIII Debt for Nature Swaps XXIV Payment for Ecosystem Services XXIV Photo: Photo caption III Closing the gap |Executive summary Photo: Ukhahlamba Drakensberg Park - IUCN IV Financing and resourcing of protected and conserved areas in Eastern and Southern Africa The funding gap Many protected areas in the Eastern and Southern African region have significant economic potential and can optimise their economic potential if revenue generating Africa’s protected and conserved areas play a vital role in models are designed properly. While not all areas have the sustaining human well-being, protecting biodiversity and inherent values and potential as some of the more iconic providing valuable ecosystem services upon which people, and accessible landscapes, the vast majority of protected wildlife and economies depend. However, these natural areas can do more to develop internal revenue sources and assets are not adequately funded, putting them and the increase revenue. services they provide at risk. Global and regional studies have been done on the financial gap and all conclude that Nature-based tourism in particular represents a significant a significant gap exists for the funding and resourcing of opportunity to develop and maximise revenue streams for protected areas (PAs). conservation and to generate benefits for communities. The Eastern and Southern African region is well placed Perhaps the most striking example of this financing gap to maximise tourism related revenues for conservation, in the Eastern and Southern African region is a recent including developing products and services that serve assessment of the annual cost of managing protected areas different market segments and optimising existing and new that support lions. This study assessed more than 282 state- concession agreements. An enabling policy environment owned protected areas and concluded that available funding and factors such as appropriate infrastructure, ease of only satisfied 10-20% of management needs. In total, the access, and safety and security, alongside inherent values funding gap for Africa’s PAs with lions was estimated at such as large intact landscape and charismatic wildlife are approximately USD 1.5 billion per annum (Lindsey, P.A., et prerequisites for the successful development of nature- al., 2018). tourism. While PAs with lions are more expensive to manage In addition to the traditional sources of funding, there are and budget requirements differ from protected area to also various other financing options, either already in use protected area, the outcome of this study provides a stark or in development across the Eastern and Southern Africa reminder of the sheer size of the annual conservation region. These include emerging finance mechanisms such financing gap in Africa. Personal communications with a as Debt for Nature Swaps (DNS) and biodiversity offsets as range of conservation actors (governments, PA agencies, well as more creative mechanisms such as outcomes-based private individuals, community associations and non- financing, green or blue bonds and tax incentives. There is profit organisations) during the development of this report significant opportunity to scale these mechanisms across confirmed that conservation work is largely underfunded the region. and severely limits conservation management. In addition, despite the clear lack of resources for the Reducing the funding gap adequate management of the existing protected areas, there is a need to increase the PA estate to adequately conserve From this report it is evident that most protected and Africa’s biological diversity and ecosystem services. This is putting additional pressure on the already stretched conserved areas in Eastern and Southern Africa face a budgets of those that traditionally fund conservation work significant funding gap and that there is a need to increase (such as governments, donor agencies and conservation self-generated revenues and develop innovative finance organisations). This is especially true in developing regions, mechanisms. where conservation funding currently competes with other Key recommendations in this regard include: development objectives, such as infrastructure, education and public health. • Understand the gap: In order to develop and implement effective strategies to address the protected area funding gap, governments and conservation Sources of funding management agencies and managers must first understand the gap by conducting an assessment for individual protected areas and the entire protected area Traditional sources of funding for conservation include system; government and donor support as well as self-generated revenue, such as for example fees collected from nature- • Develop and execute associated plans and strategies: based tourism or the utilization of wildlife through hunting Strategies to address the gap must be developed and and wildlife ranching. implemented based on actual needs, including practical While governments and donors provide significant funding business or tourism development plans for individual or for conservation, it is clear that these sources alone are clusters of protected areas; inadequate to bridge the funding gap. Protected areas are therefore increasingly underperforming and will become more dependent on self-generated revenue. V Closing the gap • Encourage the development