What is the Kunming Declaration on Biodiversity Conservation and Should Businesses be Interested?

We discuss China’s position on biodiversity conservation and impact on business activity in light of the international adoption of the Kunming Declaration at the first part of the COP15 virtual conference. The declaration may have felt rushed, but negotiations on more concrete proposals will take place in 2022, culminating in the second part of COP15 in April-May. Meanwhile, ‘ecological civilization’ continues to be a buzzword, showing up in President Xi Jinping’s speeches, and a likely indicator that some industries and economic activities may be boosted or curtailed, if the Chinese government follows through with sustainable development initiatives.

On October 13, 2021, the Kunming Declaration was adopted by over 100 countries at the first part of the ongoing 15th meeting of the Conference of the Parties (COP15) to the United Nations Convention on Biological Diversity (CBD).

Originally scheduled for October 15-28, 2020, the first part of the COP15 was postponed several times due to the COVID-19 pandemic. It finally began virtually on October 11, 2021 and will conclude on October 24 (the second part is expected to be a face-to-face meeting in Kunming from April 25 to May 8, 2022).

Dozens of ambassadors and world leaders were present at the virtual meeting, including Chinese President Xi Jinping, French President Emmanuel Macron, Russian President Vladimir Putin, UN Secretary General António Guterres, and Great Britain’s Prince Charles.

The Kunming Declaration, or the Declaration from the High-Level Segment of the UN Biodiversity Conference 2020) Part, is the main outcome of the conference.

The declaration demonstrates global commitment to an ambitious and transformative “post-2020 global biodiversity framework”, which will provide a strategic vision and a global roadmap for the conservation, protection, restoration, and sustainable management of biodiversity and ecosystems for the next decade.

Under the theme of “Ecological Civilization: Building a Shared Future for All Life on Earth”, the Kunming Declaration addresses key elements needed for a successful post-2020 framework: the mainstreaming of biodiversity across all decision-making; phasing out and redirection of harmful subsidies; enhancing the rule of law; and increasing financial, technological, and capacity-building support to developing countries, among others.

The post-2020 global biodiversity framework is due to be finalized and adopted at the second part of the COP15 in May 2022, after more formal negotiations in January 2022.

What are the commitments under the Kunming Declaration?

The Kunming Declaration outlines general targets for the restoration and protection of biodiversity. The document lists 17 commitments for member countries, urging both international collaboration on a number of issues and increased efforts at a domestic level.

Below are some of the commitments outlined in the document.

Biodiversity protection

• Developing and implementing a global biodiversity framework to reverse the course of biodiversity degradation and be on a “path of recovery” by 2030.
• Develop and implement an “Implementation Plan and Capacity Building Action Plan for the Cartagena Protocol on Biosafety” – an international agreement signed in 2003 that aims to protect biodiversity from the risks posed by biotechnology, such as genetically modified organisms (GMO).
• Adopting the ecosystem approach to increase resilience and help humans adapt to the adverse effects of biodiversity loss and climate change.
• Reduce negative effects of human activity on marine and coastal biodiversity.

Policy and regulatory

• Integrate conservation and biodiversity into government decision-making for matters, such as poverty alleviation, economic policies, regulations, and other government policies.
• Increase effectiveness of
• Increase coverage of area-based conservation and management to protect species and genetic diversity.
• Enhance both international and national environmental laws and strengthen enforcement of laws.
• Strengthen measures for developing and regulating biotechnology to ensure equitable distribution of its benefits while minimizing their environmental impact.

Financial

• Reform, eliminate, or phase out financial incentives that are harmful to biodiversity.
• Provide financial tools to developing countries to help them fulfil the commitments of the Convention.

Community involvement

• Enable participation of indigenous and local communities, as well as all relevant stakeholders, in the development and implementation of a biodiversity framework.
• Develop educational tools to improve communication and public awareness.

How effective is the Kunming Declaration expected to be?

The Kunming Declaration does not hold members to any tangible or measurable biodiversity targets, leading some to cast doubt over how effective the document will be in inspiring real action.

Many of the commitments outlined in the Kunming Declaration are basically a continuation of the 2011-2020 Strategic Plan for Biodiversity and the Aichi Biodiversity Targets, which also included commitments to reducing incentives for activities that threaten biodiversity, integration of biodiversity with other government policies, and increasing resilience against climate change.

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The Aichi Biodiversity Targets included some relatively concrete goals, such as specific reductions targets and commitments to increasing the area of protected land and sea, although they were also criticized for being too vague and difficult to measure. In fact, reports detailing the results of the Aichi Biodiversity Targets show that many of the goals were missed, indicating that the document had limited impact on the behavior and ambitions of its signatories.

Meanwhile, in the Kunming Declaration – the “30 by 30” goal, is a proposed commitment to protect 30 percent of land by 2030. The declaration does not expressly commit to this goal, stating only: “Noting the call of many countries to protect and conserve 30 percent of land and sea areas through well-connected systems of protected areas and other effective area-based conservation measures by 2030”.

The Aichi Biodiversity Targets, by contrast, committed to the conservation of 17 percent of terrestrial land and inland water and 10 percent of coastal and marine areas.

Although the effectiveness of the Kunming Declaration in its current form is up for debate, the document is yet to be finalized and will undergo further deliberation at part two of the COP15 next year.

What should foreign investors make of China’s biodiversity conservation plans

The Kunming Declaration was adopted as a document of political will rather than a binding international document. Analysts predict that there won’t likely be any direct and immediate changes to the environment and practices of doing business. Maintaining stable economic growth is still the highest priority for Chinese government.

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However, under China’s concept of “ecological civilization” and its endeavor to play a bigger role in global environmental governance, it can be expected that China will take the issue seriously and more measures supporting biodiversity will be developed in the future.

For example, among others, the Kunming Declaration mentioned that “[the signed parties will] work with ministries of finance and economy, and other relevant ministries, to reform incentive structures, eliminating, phasing out or reforming subsidies and other incentives that are harmful to biodiversity, while protecting people in vulnerable situations, to mobilize additional financial resources from all sources, and align all financial flows in support of the conservation and sustainable use of biodiversity”. It may lead to a thorough assessment and revision of China’s incentive policies to stick to this principle, which could be a variable for investors if their businesses rely heavily on the incentives and subsidies or if they are engaged in a polluting business activity directly or indirectly.

As for supporting measures to protect biodiversity, on October 12, this year, Xi Jinping pledged RMB 1.5 billion (US$232 billion) to support biodiversity in developing countries. He also announced the establishment of China’s first five national parks (one in the Tibetan Plateau, one for giant pandas in Sichuan, one for Siberian tigers and Amur leopards in northwestern China, one for the tropical rainforest in Hainan, and one to protect subtropical forest in Mount Wuyi in Fujian). “The combined protected area [of these parks] is 230,000 square kilometers, covering nearly 30 percent of [China’s] land area,” he said.

Enterprises that can contribute to the conservation and sustainable use of biodiversity may be able to take advantage of emerging opportunities, such as enterprises focusing on digital sequence information of genetic resources, ecosystem restoration, clean energy, and sustainable food production, etc.

Dezan Shira & Associates has helped environment and cleantech investors across China, ASEAN, and India. From pre-investment studies and strategy development to setup and helping with requisite compliances, the firm has tailored its services to help foreign companies enter this emerging industry in Asia.

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