Ecological Fiscal Transfers (EFT) in Malaysia: Incentivizing and Encouraging Subnational Governments to Conserve Biodiversity in Terrestrial and Marine Ecosystems

With the mainstreaming of biodiversity into plans and policies, Malaysia increasingly recognised nature’s role in economic development and social wellbeing. The domain of biodiversity management today is more than conservation and protection. It encompasses sustainable use, threat reduction, access and sharing the benefits from biological resources, among others.

The ecological fiscal transfer (EFT) mechanism was in part supported by UNDP’s Biodiversity Finance Initiative (BIOFIN) and took several years of preparatory work, being announced by the Ministry of Finance for the first time in the 2019 National Budget. EFT allocates national funds to local governments based on conservation needs and past performance. This encourages states to prioritize conservation and effective management of protected areas (PAs), while compensating for lost economic opportunities.

USD 177.73 million has been transferred to state governments for the protection and expansion of forest reserves and PAs, enabling the creation of 350,000 hectares.

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Results-based budgeting in the Pak Kret City Municipality, Thailand: Integrating biodiversity targets into local government budgets

Pak Kret City Municipality is located on the Chao Phraya River plain in Thailand, an area with fertile soil for agriculture. The subdistrict is home to 63 native durian varieties, a flavorful tropical fruit. However, unplanned urban expansion, pollution, and climate change have threatened urban biodiversity and agricultural activities in Pak Kret. Its proximity to Bangkok, only 20 kilometers away, intensifies these pressures.

Amid this situation, Pak Kret City Municipality, with support from the Biodiversity Finance Initiative (BIOFIN) of the United Nations Development Programme (UNDP), adopted results-based budgeting: an approach that integrates biodiversity targets into government budgets, thereby increasing nature-positive investments.

As a result, Pak Kret invested USD 11 million (THB 372 million) — 17% of its total budget — in biodiversity in 2025, reflecting priority concerns to protect its distinctive durian variety, expand green spaces, and enhance air quality, water, and waste management systems.

Sri Lanka’s National Sustainable Tourism Certification scheme: Promoting sustainable experiences, supporting conservation, and catalyzing biodiversity finance

Habitat degradation, pollution, and over-exploitation have threatened Sri Lanka’s rich biodiversity, which contains high levels of endemism. Moreover, an economic crisis that began in 2019 made it challenging to increase public funding for biodiversity. The COVID-19 pandemic aggravated this situation and added pressure to the livelihoods of those dependent on tourism.

While unplanned tourism expansion can be detrimental to biodiversity, the sector is also a source of opportunities for long-term conservation and local income generation. The Sri Lanka Tourism Development Authority (SLTDA), the United Nations Development Programme (UNDP)’s Biodiversity Finance Initiative (BIOFIN), and other partners developed a National Sustainable Tourism Certification scheme to promote biodiversity conservation and support economic recovery.

As of June 2025, 37 hotels, one destination, and 204 small and medium enterprises were certified. BIOFIN estimates that this initiative has catalyzed USD 4.026 million in investments for biodiversity.

Connectivity Conservation Initiative for Fresh Drinking Water (Konitsa, Greece)

The solution aims at maintaining ecological connectivity in the long-term by allowing the free movement for the endangered carnivores wolf and brown bear among their habitats considering climate change adaptation objectives. The conservation of ecological corridors between their habitats is essential to sustain biodiversity in a changing climate condition and to ensure the resilience of ecological services. In this framework, the proposed solution address the challenge of securing fresh water supply across corridors that can support basic needs of wildlife species. In addition, this solution is based on the documentation of traditional knowledge on sustainable water management engaging local communities and maintaining traditional building techniques related to cultural heritage.

From World Hertiage to Conservation

Jiuzhaigou National Nature Reserve, also a key national scenic area, was inscribed on the World Heritage List in 1992. Named after the nine Tibetan villages within its boundaries, Jiuzhaigou boasts not only abundant flora and fauna but also its “Six Wonders”: alpine lake clusters, waterfalls, colorful forests, snow-capped peaks, blue ice formations, and Tibetan cultural charm, attracting countless visitors worldwide.

Remarkably, Jiuzhaigou has avoided ecological crises despite tourism development, achieving a win-win balance between economic benefits and environmental conservation. It stands as a successful model of implementing the principle “protection comes first, while tourism serves as the optimal development approach.”

Ceasing Harmful Coastal Construction Subsidies to Protect Biodiversity in the Surroundings of the Mrigadayavan Palace, Thailand

The Mrigadayavan Palace, built in 1924 between the beach towns of Cha-Am and Hua Hin, was the summer house of King Vajiravudh, who ruled until 1925. To prevent coastal erosion and protect this cultural landmark, The Marine Department of Thailand (Ministry of Transport) constructed groins, seawalls, and jetties along the beach near the palace. These rigid structures cost USD 8.4 million in subsidies.

National experts, partners, and the Biodiversity Finance Initiative (BIOFIN) of the United Nations Development Programme (UNDP) measured the impact of subsidies on ecosystems in Thailand. After the team found that rigid coastal structures had accelerated erosion instead of preventing it, they presented these results to the Department of Marine and Coastal Resources (Ministry of Natural Resources and Environment).

As a result, the Thai cabinet ceased subsidies for coastal rigid structures near the palace. Existing structures were replaced with nature-based solutions, restoring the ecosystem and protecting cultural heritage.

Green Credit and Loans in Ecuador: Supporting small entrepreneurs, empowering vulnerable groups, and using an automated software to assess social and environmental risks

Ecuador is one of the world’s 17 megadiverse countries, with rich fauna and flora. However, economic reliance on non-renewable resources and unsustainable agricultural practices have threatened its biodiversity. Sustainable entrepreneurship offers an alternative to align economic activities with environmental protection. Yet, low-income women, youth, and other vulnerable groups face barriers in accessing credit to start small businesses.

Amid this situation, the National Corporation of Popular and Solidarity Finance (CONAFIPS) of Ecuador, with support from the United Nations Development Programme (UNDP)’s Biodiversity Finance Initiative (BIOFIN), developed a Social and Environmental Risk Management System (SARAS) tool: a free and automated software that enables credit unions to screen loan applications against social and sustainability criteria.

As of August 2024, credit unions approved USD 804 million in green credit using SARAS, fostering a nature-positive economy, conserving biodiversity, and supporting women and the youth.

Diverse Culture Based on the Satoyama Initiative of Shuanglianpi Pond (Yilan, Taiwan)

The Shuanglianpi Settlement, located in the mountains of Yilan, is named after Shuanglianpi Pond. Known for once hosting a third of Taiwan’s native aquatic plant species, the area was designated as the “Yilan County Shuanglianpi WildlifeRefuge” in 2003 to protect its freshwater plants.

This designation and land expropriation led to longstanding conflicts among residents, public

sectors, and externalgroups. In 2018, the Yilan Branch of the Forestry and Nature Conservation Agency began interviewing local elders and residents, uncovering a shared memory: the damaged century- old irrigation canal. Most residents expressed support for restoring the canal torebuild relationships, foster communication, and establish a partnership basedon mutual support. To advance sustainable development, the Branch invited local partners to join resilience

assessment workshops (RAWs) in 2022 to identify priorities and formedan interdepartmental platform for ongoing adaptive co-management of Shuanglianpi.

Integrated river restoration and community stewardship to protect the Critically Endangered Tradouw Redfin

This Solution applies integrated river restoration and community stewardship to reduce key threats to the Critically Endangered Tradouw Redfin in the Huis River, South Africa. It combines invasive alien plant clearing, targeted riparian restoration, water-saving measures and community awareness to improve habitat quality and river resilience.

The approach addresses habitat degradation, invasive vegetation, water pressure and limited local awareness. By restoring riparian structure and coordinating action through a multi-agency Tradouw Redfin Working Group, the project improved river health indicators, restored critical habitat and strengthened long-term protection for the species through a formal Species Action Plan.

The +Mujeres +Natura (+Women +Nature) Programme: Empowering women through access to nature-positive finance and participation in decision-making for biodiversity

Women have a fundamental role in biodiversity conservation in Costa Rica and globally. However, gender-based barriers limit their access to biodiversity-related financial mechanisms, such as payments for environmental services and credit for sustainable agriculture and bio-businesses.

In 2020, the Ministry of Environment and Energy of Costa Rica (MINAE) and the Biodiversity Finance Imitative (BIOFIN) of the United Nations Development Programme (UNDP) launched the umbrella programme +Women +Nature to promote gender equality in biodiversity. Central to this initiative are three mechanisms to increase women’s access to finance, including two credit lines and one payment for environmental services scheme.

These mechanisms have strengthened women’s agency in conservation through USD 6,979,050 in credit lines and 530 payment for environmental services contracts, contributing to biodiversity conservation and inclusive economic development in Costa Rica.

World-First Jaguar-Protection Insurance in Misiones, Argentina: Protecting wildlife and supporting livestock farmers

The jaguar (yaguareté) is the largest feline in the Americas and a national symbol in Argentina, yet fewer than 250 remain nationwide, about 90 in Misiones. Habitat loss and declining prey have increased jaguar predation on livestock and pets, harming farmer’s income and driving retaliatory killings. To transform conflict into coexistence, the Government of Misiones, UNDP (BIOFIN and IRFF), the insurer Río Uruguay Seguros, and the NGO Aves Argentinas developed the world’s first jaguar-protection insurance.

Purchased by the province of Misiones and offered free of charge to residents, the insurance provides prompt compensation to producers for verified jaguar predation. Launched in April 2025, the scheme verified five claims in its pilot phase in Comandante Andresito and has since expanded to other municipalities affected by human–jaguar conflict. By protecting rural livelihoods, the insurance discourages retaliation and protects the jaguar.

Building community-led restoration capacity through an operational indigenous plant nursery

This Solution centres on establishing an operational indigenous plant nursery as part of an active restoration programme in the Grootvadersbosch landscape, South Africa. The nursery is used not only to propagate locally appropriate indigenous plants, but also as a practical training hub for community members involved in restoration.

The approach addresses key challenges including invasive alien plants, degraded riparian and forest-edge habitats, limited local restoration skills, and shortages of suitable planting material. By integrating training with hands-on nursery work and field implementation, the project has produced thousands of indigenous plants, restored degraded sites, and built lasting restoration capacity within the local community.

Restoration of Wetland Habitats in Tara National Park through Innovative Technologies

The project aimed to restore the Crveni Potok peat bog in Tara National Park (~25,000 hectares of forests), threatened by climate-induced water insecurity. Tara National Park is known recognized for its rich and valuable ecosystems, including sensitive peat bogs serving as refuges for boreal species. Notable bogs like Crveni Potok are endangered due to altered water regimes, directly affecting peat forming moss species from the Sphagnum genus.

The project introduced fog catchers for peatland restoration at Crveni Potok, as a nature-based solution ensuring proper water management despite changing climates. This approach aimed to be a replicable model for peatland restoration in Serbia and elsewhere. Key actions included implementing fog catchers, use of data loggers to monitor wetland habitats, translocation of Sphagnum mosses from ex-situ to in-situ at a 30m2 pilot site and raising awareness about the ecological significance of peatlands.