Nature-Based Solutions in Latin America and the Caribbean: Financing Mechanisms for Replication

The document argues that public and philanthropic funding are insufficient to meet the needs of nature-based solutions (NBS) in Latin America and the Caribbean, necessitating the use of private sector green finance. It proposes five specific financial strategies—green bonds, land-based financing, blended loans, insurance policies, and endowments—to increase the resilience of infrastructure and drive economic growth. To scale these solutions, the paper recommends integrating NBS into infrastructure planning, using 'green-gray' hybrid investment models to lower risk, establishing clear performance metrics to provide proof of concept, and monetizing co-benefits like carbon sequestration.

• Nature-based solutions (NBS) are presented as a cost-effective method to foster inclusive economic growth and protect communities and infrastructure from climate change impacts in Latin America and the Caribbean, where annual infrastructure needs are estimated between $179 billion and $313 billion.
• There is a significant investment gap for NBS that cannot be filled by public and philanthropic sources alone, requiring the mobilization of private sector green finance through five specific strategies: green bonds, land-based financing strategies, blended market-rate and concessional loans, insurance policies, and endowments.
• To increase investor acceptance and reduce transaction costs, the paper suggests a 'green-gray approach' that integrates NBS into traditional infrastructure investment models alongside gray infrastructure to meet minimum investment thresholds.
• The financial viability of NBS can be improved by monetizing co-benefits, specifically through the forest product market for timber or the carbon offset market for carbon sequestration.
• Scaling NBS requires overcoming uncertainties in performance metrics; the document calls for upfront capital to promote public disclosure of findings and long-term data collection to provide the proof of concept investors require.

APA

World Resources Institute (2021). Nature-Based Solutions in Latin America and the Caribbean: Financing Mechanisms for Replication. https://www.wri.org/research/nature-based-solutions-latin-america-and-caribbean-financing-mechanisms-replication

Chicago

World Resources Institute. Nature-Based Solutions in Latin America and the Caribbean: Financing Mechanisms for Replication. 2021. https://www.wri.org/research/nature-based-solutions-latin-america-and-caribbean-financing-mechanisms-replication.

Wikipedia

{{cite report |author=World Resources Institute |title=Nature-Based Solutions in Latin America and the Caribbean: Financing Mechanisms for Replication |date=12 October 2021 |url=https://www.wri.org/research/nature-based-solutions-latin-america-and-caribbean-financing-mechanisms-replication |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{worldresourcesinstitute2021naturebased, author = {{World Resources Institute}}, title = {{Nature-Based Solutions in Latin America and the Caribbean: Financing Mechanisms for Replication}}, institution = {World Resources Institute}, year = {2021}, month = oct, url = {https://www.wri.org/research/nature-based-solutions-latin-america-and-caribbean-financing-mechanisms-replication}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }