Boosting Biodiversity: Can Credits Bridge Southeast Asia’s Nature Financing Gap?

A New Market for Nature

The race to protect our planet’s remaining natural ecosystems is more urgent than ever. Forests are disappearing, coral reefs are under stress, and wildlife populations are plummeting. In response, over 190 countries adopted the Kunming-Montreal Global Biodiversity Framework (GBF), a bold global agreement to halt biodiversity loss by 2030 and achieve harmony with nature by 2050.

The GBF includes 23 global targets, from protecting 30% of land and seas to scaling up finance and eliminating harmful subsidies. One figure underscores the challenge: the estimated annual biodiversity financing gap stands at US$700 billion. Public funds alone are not enough to bridge this.

For Southeast Asian countries already facing economic pressures, new financing solutions are essential. Indonesia, the Philippines, and Thailand are now exploring one promising option: biodiversity credits.

What Are Biodiversity Credits?

Biodiversity credits aim to capture the value of nature, not for its extractable resources, but for its integrity, richness, and resilience.

According to the Biodiversity Credit Alliance, these credits represent measurable, verifiable positive outcomes for biodiversity—whether by restoring a forest (uplift), protecting a vulnerable ecosystem from harm (avoided loss), or maintaining an intact habitat (maintenance). These credits can be traded, often to corporations seeking to meet sustainability goals or offset environmental impacts.

While inspired by carbon markets, biodiversity credits are inherently more complex. Nature’s diversity cannot be distilled into a single unit like carbon tones. Every ecosystem and species is unique, making standardization difficult, but not impossible.

Done right, biodiversity credits could channel private investment toward conservation. But the path is still being shaped.

Piloting the Concept – Lessons from Jambi

In February 2025, representatives from Indonesia, Thailand, and the Philippines gathered in Jambi, Indonesia, for a regional workshop organized by UNDP’s Biodiversity Finance Initiative (BIOFIN). The workshop examined how biodiversity credits could be designed, priced, and piloted in Southeast Asia.

Participants—from governments, NGOs, academia, and finance—analyzed global and local case studies, including Colombia’s Habitat Banks, Australia’s Nature Repair Market, and Indonesia’s Bujang Raba Forest credit initiative led by KKI WARSI using the Plan Vivo Standard.

Each country brought distinct experiences:

• The Philippines has emerging systems like the Carbon Accounting, Verification and Certification System (CAVCS), though a national carbon registry is still in development.
• Thailand has operated carbon markets since 2014 and is now piloting integrated carbon-biodiversity models.
• Indonesia is exploring a pilot in the Harapan Forest with REKI (Restorasi Ekosistem Indonesia), one of the country’s oldest ecosystem restoration projects.

Beyond technical details, the workshop emphasized shared learning and trust-building. The conclusion: interest is high, but the path is complex.

Photo: Jowell Angelo Banda of the Philippines’ National Economic and Development Authority supposes that the concept of biodiversity credits can leverage private investments to bridge the biodiversity financing gap and support conservation initiatives across ecosystems.

Key Challenges Identified

Five critical hurdles stand in the way of scaling biodiversity credit markets:

1. Policy and Legal Gaps
   None of the three countries has dedicated laws for biodiversity credits. Existing legal frameworks are often tied to carbon markets or broader environmental regulations. Legal clarity is essential.
2. Methodological Ambiguity
   Standardizing biodiversity metrics is a major challenge. Countries must choose between adapting international standards like Verra and Plan Vivo, developing local methodologies, or aiming for ASEAN-level harmonization.
3. Market Skepticism
   Concerns persist over greenwashing—where companies use credits for image-building rather than real impact. Ensuring transparency, scientific rigor, and community inclusion is key.
4. High Costs of Implementation
   Biodiversity credit projects can cost between US$30,000 and US$1.5 million, putting them out of reach for many local organizations. Accessible financing mechanisms are needed.
5. Institutional Capacity
   Limited enforcement, stakeholder coordination, and engagement with Indigenous Peoples and Local Communities (IPLCs) could undermine credibility and effectiveness.

Despite these challenges, countries are moving forward. Each left the workshop with plans to develop national proposals—early steps in a longer journey.

The Road Ahead

Southeast Asia is home to some of the world’s most biodiverse ecosystems. The region also faces mounting threats. Biodiversity credits, while not a cure-all, offer a new way to mobilize resources and incentivize stewardship.

As Jowell Banda from the Philippines’ National Economic and Development Authority noted, “By integrating biodiversity credits into conservation strategies, countries can create sustainable financing mechanisms that incentivize ecosystem protection and resilience.”

Thailand is considering Doi Tung as a pilot site, learning from Indonesia’s fire prevention strategies in Harapan. For Indonesia’s Bappenas, the credits are part of a broader ambition to secure its position as a biodiversity leader. “We must conserve and uplift our ecosystems,” said Adi Indarto, “so we can remain a biodiversity powerhouse.”

Each country will now refine its policy frameworks, test pilots, and explore regional coordination. If successful, biodiversity credits could not only unlock new finance but also transform how we value and protect nature.

Southeast Asia may become the testing ground that shows the world what’s possible.

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