ADB’s Kanda Brings $50 Million to a $1.3 Trillion Nature Gap

Asian Development Bank President Masato Kanda wants nature financed like a port or a power line. Kanda made the case in a statement issued in Yerevan, Armenia, on 27 October, as ADB unveiled three new nature finance initiatives at the 17th Conference of the Parties (COP17) to the Convention on Biological Diversity.

ADB’s new Biodiversity and Nature Theme Bond raised about $50 million, according to the bank’s release. In the same release, ADB estimates the world faces a $1.3 trillion annual shortfall in financing to protect and restore nature.

What ADB put on the table

ADB announced three instruments at COP17, according to its 27 October statement.

The first is a joint report from the MDBs on how they track nature finance and fold biodiversity into their investment strategies and results frameworks. ADB led the work as 2026 chair of the MDB Nature Heads Group. The bank said the report draws on the MDB Common Principles for Tracking Nature Finance, a Common Nature Taxonomy and a Guide on Results Metrics. ADB also coordinates the Joint MDB Pavilion in Yerevan, where eight development banks are presenting their nature work. It is supporting Armenia’s COP17 presidency through technical assistance that runs to 2028, according to its COP17 event page.

The second is the Nature Bond Incubator. ADB said it will give governments and companies technical advice on project development, bond structuring and investor engagement, so conservation and restoration projects can attract private capital. The incubator sits inside the ADB-led Nature Solutions Finance Hub, which ADB says aims to generate at least $5 billion in nature financing by 2030.

The third is the bond itself. ADB described it as a three-year issue of about $50 million, arranged by Crédit Agricole CIB, and its second biodiversity bond since 2024. Proceeds will go to projects in ecosystem conservation and restoration, nature-based solutions in agriculture and water management, coastal resilience and urban development, the bank said.

Kanda framed the push in household terms. “Nature sustains our economies, yet the world is investing far too little to protect it,” he said. “The consequences are felt in fishing communities, on farms, and in homes where water supplies are under threat,” he added in the release.

The scale problem in ADB nature finance

Set against ADB’s own estimate of the global shortfall, the new bond covers less than one-hundredth of one percent of a single year’s gap. The Nature Solutions Finance Hub target, $5 billion by 2030, equals about 0.4% of one year’s $1.3 trillion shortfall.

ADB’s October 2024 release shows its debut biodiversity and nature bond raised A$150 million, then equivalent to US$100 million, over a 10-year tenor. The new issue is half that size and runs three years. Japan’s Dai-ichi Life bought the entire issue, and Crédit Agricole CIB arranged it, according to that release.

The CBD Secretariat’s 26 October conference release said ADB was due to report about $800 million in ADB-supported biodiversity and nature bonds. That total equals Thailand’s $750 million sovereign bond, which ADB supported, plus ADB’s own $50 million issue.

Thailand sets the template

Thailand gave Asia and the Pacific its first sovereign sustainability-linked bond with a nature target. ADB’s 2 October release says the 15-year bond, issued on 17 September, raised 25 billion baht, or about $750 million.

The bond ties Thailand’s borrowing to two targets, according to ADB. The first holds net greenhouse gas emissions below 152 million tonnes of carbon dioxide equivalent by 2035. The second commits Thailand to conserving and managing at least 30% of the country’s land and inland water protected areas by 2030. Investors bid for 2.8 times the planned 15 billion baht, ADB reported.

ADB helped choose the indicators and reviewed the bond framework, the bank said. “This landmark transaction demonstrates how capital markets can help deliver mitigation and biodiversity outcomes,” ADB Country Director for Thailand Aaron Batten said in the release. Batten tied the deal to ADB’s commitment to mobilise $30 billion through capital markets by 2030. ADB said in its COP17 release that the new incubator builds on its Thailand support.

Governments are behind on their own promise

Under Target 19 of the Kunming-Montreal Global Biodiversity Framework, adopted in 2022, countries agreed to mobilise at least $200 billion a year for biodiversity by 2030, including at least $20 billion a year in international finance by 2025, according to the CBD’s target guidance.

That 2025 milestone was likely not achieved, the CBD’s global stocktaking report found, as Carbon Brief reported on 15 October. Carbon Brief cited an OECD report estimating international public finance for biodiversity at about $16.1 billion a year on average between 2023 and 2025, nearly $4 billion short of the 2025 goal.

Carbon Brief reported, citing Global Environment Facility data, that the Global Biodiversity Framework Fund received $387.2 million in signed commitments between August 2023 and 30 June 2026. The CBD Secretariat said a further $60.13 million was pledged to the fund during COP17’s first week.

CBD Executive Secretary Astrid Schomaker made the comparison in the Secretariat’s 26 October release.

Lim Li Ching of the Third World Network said the shortfall should not push governments toward private finance. “This failure should not be used as an excuse to pivot to the private sector or market-based mechanisms,” she told Carbon Brief, referring to developed countries missing their finance obligations.

“COP 17 is enabling a total mobilization of more than $1.8 billion from all sources,” COP17 President Hambardzum Matevosyan said in the CBD Secretariat’s 26 October release. The largest single item in the first week was the Species Recovery Alliance, through which nine philanthropic organisations committed $500 million over five years, including $100 million from the Bezos Earth Fund, the Secretariat said. France’s development agency AFD said ahead of the summit it would keep nature financing at €800 million a year despite budget constraints, after a record €1.3 billion in 2025.

About 140 finance and environment ministers and deputy ministers were due at the high-level segment on 27 and 28 October, according to the Secretariat. “Nature is what makes economies possible,” UN Environment Programme Executive Director Inger Andersen said in the same release.

The Pacific’s reef exposure

ADB’s COP17 release rests its case on the region’s reefs. Asia and the Pacific holds 75% of the world’s coral reefs and 17 of its 36 biodiversity hotspots, and its ecosystems supply food, fresh water and livelihoods to more than 4.7 billion people, the bank said.

ADB’s December 2023 report on financing coral reef protection found more than 85% of the region’s remaining reefs under threat, against roughly 75% globally. More than 150 million people in Asia and the Pacific live on or near coral reefs, according to the same report.

ADB counts Papua New Guinea among the six Coral Triangle Initiative countries, alongside Solomon Islands and Timor-Leste in the Pacific. The bank describes the Coral Triangle as the world’s most biologically diverse reef system, holding more than 75% of known coral species. ADB has been a founding partner of the Coral Triangle Initiative since 2009, its 2024 bond release states.

ADB’s Asia-Pacific Climate Report 2026, released on 21 October, says the region’s coastlines generate $7 trillion in annual economic output. Annual coastal flood damage, about $27 billion today, could reach $172 billion to $199 billion by 2050 without adaptation, the report estimates. For atoll nations, annual flood damage could reach 30% to 60% of GDP by 2100 under a high-emissions scenario, ADB said. More than 400 million people in the region live within 10 kilometres of the sea, the report found.

The same report estimates that $9 billion to $19 billion a year in coastal protection could avoid $178 billion to $360 billion in flood damage annually. Both ends of that range imply about $19 to $20 of avoided damage for every dollar spent. International adaptation finance to the region’s coastal economies rose from about $5 billion in 2015 to an average of $11.4 billion a year in 2022-2023, ADB said, and a large gap remains.

None of the three instruments in ADB’s COP17 release names a Pacific island country. The one sovereign deal it cites is Thailand’s. A week earlier, ADB launched a separate Pacific Approach 2026-2030 covering 12 Pacific island countries. ADB’s active portfolio in those countries reached $1.9 billion across 80 projects at the end of 2025, up from $454 million across 35 projects at the end of 2015, according to the bank. PNG and Fiji are not among the 12.

Southeast Asia has its own ocean commitment: ADB said on 19 September it would mobilise up to $6 billion through 2030 under a new ASEAN Blue Economy Initiative covering fisheries, aquaculture, coastal resilience and marine pollution, DevelopmentAid reported.

What the instruments mean for Pacific business

For Pacific treasuries, Thailand’s bond shows a sovereign raising $750 million with a protected-area target written into the terms. ADB’s Climate Report 2025 said scaling nature finance depends on upgrading what it called the “operating system” of governance, policy and data.

For Pacific companies, the incubator is open to businesses as well as governments, ADB said, and its new bond names coastal resilience and water management among eligible uses.

ADB’s own research points to instruments built for reef economies. Its December 2023 coral reef report examined parametric insurance, catastrophe bonds and blue carbon credits as ways to fund the protection and repair of damaged reefs, and studied the first insurance policy taken out on a reef, in Mexico. The report covered Fiji and Solomon Islands among its focus countries.

For investors, ADB said the joint MDB tracking report and Common Nature Taxonomy aim to improve accountability and give a clearer picture of how development finance supports nature protection and restoration.

ADB’s 2025 Climate Report found that about 75% of the region’s economic output, around $21 trillion, comes from sectors moderately or heavily dependent on nature, and that less than 1% of global financial assets supports nature-positive investment.

COP17 closes on 30 October with decisions on the Yerevan Pathway through 2030, according to the CBD Secretariat. ADB’s Nature Solutions Finance Hub has until 2030 to reach $5 billion.